Strategic Management Accounting Assignment: Impact of top management team characteristics and financial performance
1. Reflections on the selected peer reviewed journal article based on the assignment topic. What went well, what did not go to plan, how did you addressed any difficulties, and what had you learnt from it.
2. 2. Reflections on the research experience. What was enjoyable, what was difficult, what insights had you gained, and any issues, challenges you experienced.
3. Reflections on what you had learned from the individual assignment, including the relevance of budgeting as a management technique to businesses today. What insights had you gained and what had you learnt from it.
Reflections about selected peer-reviewed journal article based on the assignment topics
The research has been done on the data extracted from 94 enterprises. The annual financial statements and the questionnaires were used for the review. The analysis helped me appreciate the requirements for the implementation of strategic management tools in the organizations. The organizations that had displayed poor performance in the past had extensively used strategic management techniques to improve their performances (Pavlatos&Kostakis 2018). Research indicated that the top management played a vital role for implementation of strategic management practices. The research was first performed only on one factor and then the strategic management accounting techniques were included.
Intending to answer the questions for the assignment, this article selection has been apt and the research went on well. I have learned how to select the portions from the article for answering the various questions.
The points that went well were the interpretation of the statistical results in this paper. The points that did not go well were that since every human is different, their characteristics and working style is also different. Hence I am unable to appreciate as to how the same professional qualification held by two individuals in the top management can lead to varying results. The reason I have found is that every human’s skill is varying and hence the response and reaction is also different. Thus using the same yardstick for all the top managers is somehow not very convincing.
Reflections on the research experience
This research paper has helped me understand that the top management selection is the most vital element for the success of the organization. Strategic management helps in the integration of the vision and mission of the organization into breakable and achievable objectives for implementation by the sub-teams. Hence these tools are to be used not only by the CEO and the Board of Directors but also by the marketing managers (Pavlatos&Kostakis 2018).
The implementation of strategic management tools in the organization improves the level of communication between the managers that are deemed to be essential for the improvement of the company performance (Mitchell 2014).
In the past, the top management was responsible for the designing of the management control systems. It was more of a top-down approach of management accounting where the CEO and Board of Directors carry out the entire management accounting process formulation and implementation. The Chief Marketing Officer also plays a significant role in the strategy implementation. Apart from this, level of creativity of the managers is also analyzed which is known as the Role Theory. This is an additional parameter for the analysis of the top management team for strategic management. Thus, this paper links the financial knowledge from the annual report, the financial ratios, and the actions taken by the top management for the implementation of the strategic management accounting practices.
Overall it was an enjoyable experience as I have learned how the strategic management practices have evolved. There was not much difficulty faced in doing the assignment.
I have always wondered why the interviews of the top managers are displayed on the media. This research paper has shown me their significance in the company as to how they are contributing towards the company success.
Reflections on what was learned from the individual assignment
The entire process is explained in this paper. The role of the managers is to collect the information from the operations of the company that is vital for cost control and helps in comparison with the cost of the competitors. Customer profitability analysis is performed by gathering the financial and non-financial data that support the strategy of the company (Sedevich-Fons 2018). The strategic management accounting practices of the company are dependent upon external factors like market forces, government policies, global business trend, etc. The effectiveness of the different strategic management practices helps in the appraisal of how the management accounting practices align vertically and horizontally with the strategy and facilitate the company performance (Mitchell 2014). There could be multiple designs of strategy in an organization at different levels depending upon the size of the organization and the level of complexity involved.
The annual reports are used for the calculation of the financial ratios. A company having poor financial performance will make use of the strategic management tools more extensively.
As the use of strategic management tools helps in improving the company performance, the increased use of these tools was done by the companies that had a history of poor performance. The top managers formulate the strategies in such companies (Spires, Wallin & Young 2012). The companies that are affected by the economic crisis are more likely to use newer techniques to revive from it.
This research also favors that the top managers with the educational background have better knowledge and understanding of these tools that help in the implementation of the organization strategy. The level of creativity of the top managers is tested by the adoption of innovative tools that help in decision making and goal implementation. In the current times, the management accounting techniques have evolved as it has to provide additional information to know the reason behind the crisis. The role of the top management in strategy formulation has assumed more importance in the current times.
The limitation of this paper is that the results are based on the samples selected and hence it might not hold for the other areas. The important theory I have learned from this research paper is that the decision-making process and management control is influenced by the top management characteristics. The integration of the strategies of the company with the professional competence of the top management is established in this research paper. Thus, the selection of top management is vital for the organization and this has also increased the significance of the professional courses. Managers with a professional background are likely to fare better in managing the company and leading it through tough times.
I have learned that the current day management accounting practices are relevant and have changed from the routine cash inflow outflow type to a larger strategy formulation and decision making analysis. The high level of significance of the top management is also understood by this assignment and thus I have some valuable lessons on the skills that are required to be one among the top management team.
I have always wondered as to why some big corporate have suddenly introduces a new product line or discontinued an existing one. I have also wondered the intention behind a few advertising strategies. This paper has helped me understand how strategies are practically implemented by these actions to change the products and marketing as per the changing customer trends.
Mitchell, S.W. 2014, An Exploratory Study of Priority Based Budgeting: Identification of Public Values and Public Priorities through Citizen Engagement in Government Budgeting Decisions, Lawrence Technological University.
Pavlatos, O&Kostakis, X. 2018, The impact of top management team characteristics and historical financial performance on strategic management accounting, Journal of Accounting & Organizational Change, vol. 14, no. 4, pp. 455-472.
Sedevich-Fons, L 2018, ‘Linking strategic management accounting and quality management systems’, Business Process Management Journal, vol. 24, no. 6, pp. 1302-1320.
Spires, E.E, Wallin, D.E,& Young, R.A 2012, ‘Aggregation in Budgeting: An Experiment’, Journal of Management Accounting Research, vol. 24, pp. 177-199.