What Business Strategy Does and what Management Accounting is Pursuing: A Logistic Regression Analysis
Joy Lynn R. Legaspi
International Journal of Economics & Business Administration (IJEBA), 2020, vol. VIII, issue 1, 124-133
Purpose: The aim of this study is to determine whether the time period of business operation, business size, and management accounting tools are predictive of business strategy, customer intimacy, and operational excellence or product leadership. Design/Methodology/Approach: Multiple logistic regression assessed the relative importance of each factor to each category from 400 participants of SMEs. Findings: The evidence suggests that managing customers’ relationship, product or service cost information, and budgeting are aligned factors for the companies that adopt customer intimacy strategy whereas, budgeting and product or service cost information are the factors for operational excellence strategy. However, product or service cost information provides direct relationship in which the factor increases the likelihood of a positive answer than budgeting and managing customers’ relationship in which the factors decrease it, although all of the three factors are significant for the company that adopts product leadership strategy. The findings proved that product or service cost information was useful to all types of customer value proposition and the appropriateness of management accounting information system depends upon the strategies and managerial business assumptions. Practical Implications: The implementation of strategy is crucial because it requires decision making that needs to be aligned to the company’s goals and strive to deliver positive impact to target customers. Originality/Value: This study provides an indication of the appropriate category, and the positive and negative contributions of different factors for each strategy.
Keywords: Customer intimacy; management accounting; operational excellence; product leadeship; small-medium-sized enterprises. (search for similar items in EconPapers)
JEL-codes: M40 M41 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:ers:ijebaa:v:viii:y:2020:i:1:p:124-133
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