The integration of Management Accounting Practices as an innovative strategy towards sustaining small businesses operating in eThekwini metropolitan, South Africa

Abstract

The adoption of Management Accounting Practices (MAPs) has been acclaimed for providing positive administrative and strategic influence on large organizations, and are understood to play an integral part in decision-making. However, SMEs are operating in a turbulent environment, they are now challenged to effectively utilize the embedded MAPs to strengthen their strategic business approaches to maintain their sustainability and survival. Therefore, this study seeks to explore the challenges of integrating the adopted MAPs as an innovative strategy towards sustaining small businesses. The research sample consisted of 120 manufacturing SMEs operating in eThekwini metropolitan South Africa. A nonprobability convenience sampling technique and a quantitative questionnaire were utilized to identify and collect the data from the sampled population. The results of the study indicated that amongst other critical factors, lack of education and training of owner/manager and shortage of skills were the contributory factors influencing the integration of MAPs as an innovative strategy towards SMEs’ sustainability. The study results further revealed that there are a variety of other challenges hindering SMEs from utilizing MAPs as an innovative strategic tool and those were the enterprise age and years in operation, lack of government business incubation and technology adoption. These contributory factors were identified as necessary aspects that SMEs needed to align and iron out before integrating MAPs as an innovative strategic tool.

Innovative management accounting practices for sustainability of manufacturing small and medium enterprises

“…Enterprises may be able to show justification for adapting regulatory regime changes swerving over the globe for sustainability Various countries 59 Wouters et al (2016) Overview of research published in the innovation and operations management on 15 methods of cost management in new product development. The top three methods are: modular design, component communality and product platforms whereas target costing was the most used practice in management accounting 60 Msomi et al (2020) Manufacturing SMEs managers are clearly aware of strategic impacts and benefits of integrating contemporary MAPs as an innovative strategy for sustainability but due to economic challenges associated with its integration, they opt for traditional MAPs South Africa…”

“…From an environmental viewpoint, SMEs are known to be irresponsible, owing to their limited knowledge of MAPs (Ramli & Ismail, 2013;Mat et al, 2018, Ngibe & Bingwa, 2020. As a result, there may be a need for regulatory agencies to be careful when designing frameworks and regulations to ensure that such policies promote benefits for SMEs' involvement in environmental and social sustainability (Jamil et al, 2015;Nair & Nian, 2017:182).…”

Sustainable Entrepreneurship Education: A Systematic Bibliometric Literature Review

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