The impact of management accounting, product structure, product mix algorithm, and planning horizon on manufacturing performance

Lea, Bih‐Ru; Fredendall, Lawrence D.

doi:10.1016/s0925-5273(02)00253-0

Cited by 70 publications

(44 citation statements)

References 16 publications

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“…By stochastic simulation, Lea and Fredendall (2002) focus on how the management accounting system and the methodology to determine the product mix impact on (short-and long-term) performance for different shop characterizations, that is shops with flat and deep product structure. With respect to the type of management accounting system, they examine the case of traditional costing systems, activity-based costing systems, and throughput accounting.…”

Section: Management Accounting Systemsmentioning

confidence: 99%

“…In a nutshell, they consider four input variables for their simulated product mix decisions: the type of the accounting system, the product structure, the product mix algorithm, and the planning horizon. Lea and Fredendall (2002) also consider uncertainty in the environment through stochastic processes. They provide some interesting results: they show that activity-based costing systems are more sensitive to environmental uncertainty than traditional costing systems.…”

Section: Management Accounting Systemsmentioning

confidence: 99%

“…This results holds irrespective of whether financial or non-financial measures are deployed for the determination of performance. Lea and Fredendall (2002) narrowly define scenarios in which shop manageability (in terms of reduced bottleneck shiftiness) increases for flat and deep product structures. This is particularly the case for scenarios in which the TOCh product mix algorithm is deployed.…”

Section: Management Accounting Systemsmentioning

confidence: 99%

See 2 more Smart Citations

Simulation-based research in management accounting and control: an illustrative overview

Leitner

Wall

2015

J Manag Control

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In this article, we provide an overview of applications of simulation as a research method in the domain of management accounting and control (MAC). According to different perspectives on management control systems, we report on simulation-based research efforts related to (1) management accounting systems, (2) organizational control mechanisms for managerial decision-making, and (3) strategy development and implementation. We find that-though not always labeled as "MAC"-simulation-based research provides valuable findings for the domain of MAC, and allows for shedding new light on conventional wisdom. For example, simulation-based research suggests that when evaluating the (in-)accuracy of management accounting systems, the mechanisms incorporated in management control systems, as well as the broader organizational context, like the organizational structure, has to be considered. We come to the conclusion that simulation-based research within the domain of MAC could, for example, contribute (i) to a deeper understanding of the interactions between the micro-and the macro-layer of organizations as well as (ii) to the emergent properties of management control systems.

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Section: Management Accounting Systemsmentioning

confidence: 99%

Section: Management Accounting Systemsmentioning

confidence: 99%

Section: Management Accounting Systemsmentioning

confidence: 99%

See 1 more Smart Citation

Simulation-based research in management accounting and control: an illustrative overview

Leitner

Wall

2015

J Manag Control

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“…By analysing how different types of management accounting systems and product mix methods interact in different conditions of planning horizons and product structures, Lea and Fredendall (2002) concluded that different configurations of the variables lead to different recommendations, with no same and best product mix method for every situation. The authors mention that the TOC heuristic, in combination with any accounting system, reduces bottleneck shiftiness, perhaps because it tries to fully utilise the bottleneck and allows idle time on non-bottlenecks to ensure -due to the variability in operations -that the bottleneck is fully utilised.…”

Section: Authorsmentioning

confidence: 99%

When less is better: Insights from the product mix dilemma from the Theory of Constraints perspective

Souza

Sobreiro

Nagano

et al. 2013

International Journal of Production Research

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Perhaps due to its origins in a production scheduling software called Optimised Production Technology (OPT), plus the idea of focusing on system constraints, many believe that the Theory of Constraints (TOC) has a vocation for optimal solutions. Those who assess TOC according to this perspective indicate that it guarantees an optimal solution only in certain circumstances. In opposition to this view and founded on a numeric example of a production mix problem, this paper shows, by means of TOC assumptions, why the TOC should not be compared to methods intended to seek optimal or the best solutions, but rather sufficiently good solutions, possible in non-deterministic environments. Moreover, we extend the range of relevant literature on product mix decision by introducing a heuristic based on the uniquely identified work that aims at achieving feasible solutions according to the TOC point of view. The heuristic proposed is tested on 100 production mix problems and the results are compared with the responses obtained with the use of Integer Linear Programming. The results show that the heuristic gives good results on average, but performance falls sharply in some situations.

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“…Dentro dos aspectos gerenciais Lea e Fredendall (2002) observam que, quando o cálculo do custo do produto está incorreto, sempre que a demanda for maior que a capacidade produtiva da empresa é possível que a decisão de mix de produtos resulte na produção daqueles menos rentáveis, enquanto que os mais rentáveis podem ser demandados, mas não produzidos.…”

Section: Martins E (2010) Menciona Que a Contabilidade De Custos Naunclassified

Integração do método do custeio variável à demonstração financeira de resultados: um estudo de caso em uma indústria de médio porte.

Silva¹

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This research deals with the conflicting differences among the diverse costing methods presented by the literature in management accounting and production management, focusing on the question of the understanding conflicts which are created between the "accounting world" and the "production management world" since the figures presented and analyzed by both are usually disparate. Such conflicts may sometimes drive to a poor management, with reflex many times in inadequate short term decision making. The research has as main objective to integrate the management method of variable costing to the financial statement without impairing the aggregated results. It is proposed for it the utilization of a hybrid model of analysis that presents at the same time the results determined from management criteria of direct costing and the results determined from the financial accounting, based on absorption costing. As secondary objectives it pursues to evidence the theoretical aspects that define the conflicts and limits which permeate the costing topic when put under the management accounting and the financial accounting perspectives and to raise specialized literature about costing methods, identifying their main differences. Thus, it is performed a general revision on the literature related to systems, methods and tools for costing and economic production management, aiming at providing a general framework that delineates the mentioned context, including, but not limiting to, the questions that permeate the subject. The research is constructed and based on a case study with qualitative approach, where it seeks to capture, besides the numeric differences question, the nuances of managing and understanding the results experienced by a real company. It provides an integrated view of the costing process that enlightens both the management decision making and the impacts caused in final aggregated results from financial accounting.

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The impact of management accounting, product structure, product mix algorithm, and planning horizon on manufacturing performance

Cited by 70 publications

References 16 publications

Simulation-based research in management accounting and control: an illustrative overview

Simulation-based research in management accounting and control: an illustrative overview

When less is better: Insights from the product mix dilemma from the Theory of Constraints perspective

Integração do método do custeio variável à demonstração financeira de resultados: um estudo de caso em uma indústria de médio porte.

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