Determinants and impact of strategy-driven manufacturing accounting techniques on organisational competitiveness: a structural equation modelling approach

Abstract

Purpose This study aims to investigate contextual factors affecting the deployment of strategy-driven manufacturing accounting techniques (SMAT), as well as the impact of SMAT usage on organisational competitiveness. Seven major SMAT were investigated, namely, benchmarking, integrated performance measurement, environmental management accounting, strategic costing, strategic pricing, strategic investment and life cycle costing. Design/methodology/approach By using multi-informant strategy, structured questionnaire was used to gather survey data from 129 senior accounting, finance and production personnel of publicly quoted manufacturing companies in Nigeria. Data was analysed using structural equation modelling and propensity score matching. Findings Result shows that the usage rate of the SMAT is generally moderate. Market orientation and deliberate strategy formulation are notable determinants of SMAT usage. The inability of competition intensity and perceived environmental uncertainty to notably affect SMAT usage suggests that external environmental pressure to use SMAT is weak. Practical implications Although the impact of SMAT usage on organisational competitiveness is positive and statistically significant, it is conceivable that the impact of SMAT could have been more assuming SMAT recorded extensive usage. Thus, the lack of competitiveness of manufacturing companies in Nigeria may not be unconnected to the superficial usage of SMAT. Originality/value The study contributes to knowledge in three ways. First, it extends studies on the contingency theory that contextual factors influence the adoption of management accounting innovations. Second, it exposes the contextual factors affecting the adoption of SMAT in a developing country. Third, it provides evidence on the value relevance of management accounting innovation in enhancing organisational competitiveness.

Determinants and impact of production planning and control accounting techniques on competitiveness of manufacturing companies: a structural equation modelling approach

“…First, it is conceivable that deploying PPC may resolve some of the Nigerian manufacturing sector’s problems relating to production management. PPC usage may help address some challenges confronting manufacturing companies, particularly problems relating to reactive production pricing, poor product quality, production wastage, lack of long-term strategic plans in product design, and reluctance to utilise modern technology (Oyewo et al , 2024). Second, since PPC adoption encourages organisations to adopt forward-looking product costing (Phan et al , 2014), PPC usage should help manufacturing companies in Nigeria focus on long-term production plans and strategy formulation in product costing and pricing.…”