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The effect of accounting information systems on the performance of Mexican micro, small and medium-sized family firms: An exploratory study for the hospitality sector
Abstract
This study analyses how the implementation of accounting and financial information and management control systems affect the performance of family and non-family micro, small and medium-sized enterprises (MSMEs) in the hospitality sector in Quintana Roo State (Mexico). The authors carried out a cross-sectional study with a sample of 122 family and non-family tourism MSMEs (composed of 72 family and 50 non-family firms). A survey was used to collect the data. The results show that managers of family firms in the hospitality sector use less accounting and financial information in their decisions than those of non-family firms. The findings also imply that hospitality family firms maintain less formalized management control systems than non-family firms in terms of the timeliness, aggregation and integration of economic and financial information in the decision making process.
... The objective of an AIS is to direct an organization to achieve its designated objectives (Davila et al., 2009). Information and planning systems are useful for the management as instruments for the achievement of corporate objectives (Esparza-Aguilar et al., 2016). AIS design is a method for enhancing organizational performance (Chenhall et al., 2011;Soudani, 2012). ...
... AIS design is a method for enhancing organizational performance (Chenhall et al., 2011;Soudani, 2012). An AIS is part of MCS which is highly important for corporate performance, since accounting information is used in the resource planning and resource allocation phases to analyze, measure and evaluate any alternatives in decision-making process (Davila and Foster, 2005;Esparza-Aguilar et al., 2016). Manager's measure, which is based on accounting information, will influence corporate performance (Lucas, 1975). ...
... In addition, accounting information utilization may reduce asymmetry of information with creditors. Therefore, good accounting information quality may enhance the probability of obtaining funds from creditors, thus influencing corporate performance (Esparza-Aguilar et al., 2016). ...
Purpose
This study provides empirical evidences on the relationship between business strategy and micro, small and medium enterprises (MSMEs) performance. Additionally, the study aims to explore the role of innovation and accounting information systems (AISs) in the strategy performance linkage among MSMEs in Indonesia.
Design/methodology/approach
A questionnaire-based survey was conducted, which produced 102 valid responses. Surveys were distributed to MSME owners throughout Solo, Yogyakarta and Semarang, Indonesia. Data were analyzed by using structural equation model with partial least squares.
Findings
The result shows that business strategy has indirect impacts on MSMEs' performance. Both innovation and AIS positively mediate the relationship between business strategy and MSMEs’ performance.
Research limitations/implications
The performance variable was measured based on the owners' perception. This makes the results not to be reflective of the real performance situation.
Practical implications
Alignment between strategy and innovation plays a vital role in improving the performance of MSMEs. The differentiation strategy that focuses on product uniqueness and quality requires innovation to add value to the product and the customer. The innovation process is at high risk of failure, so MSMEs owners need accurate calculations in decision making. AISs are part of management control to reduce risk by identifying standards and directing organizational goals.
Originality/value
This study considers the contingency factors in the relationship between strategy and performance by providing innovation variables and AIS.
... Competitiveness at enterprise level is understood as the company's ability to be more productive and obtain higher profits (Mill an-Garc ıa and G omez-D ıaz, 2018). The studies on this topic come from the economy discipline and focus on achieving competitiveness trough diverse indicators, such as economic and financial profitability (Camis on et al., 2016;Moreno and S anchez, 2016;Moreno 2017;Rodr ıguez, 2013;Petri c, 2003;Soler et al., 2017); accounting management (Esparza et al., 2015;K€ oroglu et al., 2014); internationalization (Andreu et al., 2017(Andreu et al., , 2018; market orientation (Banki et al., 2016;Debski, 2017;Di eguez-Soto et al., 2017;Getz and Nilsson, 2004;Querol et al., 2012;Maravi c et al., 2016) and price (Soler and G emar, 2016;Mandi c and Jurun, 2018). ...
... Comparatives studies between FB and non-FB indicate that FBs are less competitive based on productivity, labor costs, accounting management and economic and financial profitability ( An efficiency accounting management has a positive relation with the performance of businesses and with the number of stars in accommodation establishments (K€ oroglu et al., 2014). It means a disadvantage for smaller FB due to the lack of economic capital, which can be related to the poor implementation of accounting and financial information in the decisionmaking process (Esparza et al., 2015). ...
... Camis on et al., 2016;Esparza et al., 2015;K€ oroglu et al., 2014;Moreno and S anchez, 2016;Moreno, 2017;Rodr ıguez, 2013), except for the wine tourism FB(Soler et al., 2017). Also, FB has less benefit orientation, reduced self-financing capacity, limited new investments and greater financial dependence, so they are more vulnerable to economic risks(Camis on et al., 2016;Moreno and S anchez, 2016). ...
Purpose
The purpose of this study is to analyze the current state of knowledge of family businesses in tourism through a systematic review of international academic literature with an emphasis on Latin America.
Design/methodology/approach
The paper opted for a systematic review involving analyzing international academic documents, articles, dissertations and papers that presented both theoretical and empirical research results. The search was conducted from January to April 2019 on online databases and search engines.
Findings
Studies are concentrated in strategic planning and competitiveness. Most of them are published since 2014 by Ibero-American countries. Some features are coincident among the varied geographical contexts, as the importance of generational succession planning; search for family welfare throughout the business; and the existence of own capacities and resources. Besides, the owner's objectives and gender involvement differ in the research results of developed countries and emerging economies; some implications for Latin America are analyzed.
Originality/value
The family business has international economic relevance, especially in tourism. Still, the studies in this field are few, even when tourism implies processes and interactions that can influence the development of the companies that integrate their industry. In this way, a compilation of the recent works is carried out, in order to identify how the complex family dynamics with tourism are integrated into the studies, main contributions to the field and knowledge gaps.
... Microenterprises may have a single owner-manager or up to 10 employees (DOF, 2009;European Commission, 2005). Generally, these businesses run short of resources, notably both financial and human capital (Berrone et al., 2014;Dyt and Halabi, 2007;Esparza et al., 2016). Its administration is likely to be rather intuitive, guided by the expertise and knowledge of the owner-manager (Liberman-Yaconi et al., 2010). ...
... Many of these firms are managed without a business plan and are run intuitively, guided by common sense and the personal experience of their owners-managers (Agyapong and Muntaka, 2012;Halabi et al., 2010;Masurel and Smit, 2000). As a result, they often struggle to compete against the bigger, more-resourced, professionally managed businesses, leading to a rather large mortality rate among microbusinesses during their first three years of operation (Esparza et al., 2016;Liberman-Yaconi et al., 2010). ...
... Some authors have noted this and have pointed out the importance of studying separately for micro and small businesses, in such a way that specific applications, processes and recommendations can be drawn for them (Alattar et al., 2009;Berrone et al., 2014;Dyt and Halabi, 2007;Liberman-Yaconi et al., 2010;Shields and Shelleman, 2016;Sian and Roberts, 2009). The challenge is compounded by the lack of systematic and reliable data on SMEs and more so on microenterprises (Dyt and Halabi, 2007;Esparza et al., 2016;Gorton, 1999;Halabi et al., 2010;Pejic-Bach, 2003;Shields and Shelleman, 2016) and its assumed simplicity (Liberman-Yaconi et al., 2010). Furthermore, Armitage et al. (2016), Berrone et al. (2014), Gorton (1999) and Lavia and Hiebl (2015) emphasized the need for further research on small firms in developing countries as opportunity areas for future research. ...
Purpose
The purpose of this paper is to explore if and how micro and small firms apply management accounting (MA) techniques.
Design/methodology/approach
The study is based on 36 semistructured interviews with micro and small firm owners/managers in Mexico. Content analysis is used to identify how these enterprises use MA tools.
Findings
Micro and small firms consistently use MA tools. Most of them have some sort of planning, set objectives, have a costing system – even if budgeting is unusual – and use one or two metrics to monitor performance.
Research limitations/implications
This is exploratory research with a limited and nonrandom sample. Only a limited number of MA tools were studied.
Practical implications
Micro and small firms’ use of MA tools. This is arguably important because these enterprises use these techniques in a way that is different from the traditional approach used in bigger corporations. A relevant implication emerging from the findings, as a contribution to practice would be the need to include MA for micro and small businesses in formal training and textbooks.
Originality/value
On top of providing and assessing empirical evidence on a debate that has been so far largely theoretical, and on the back of the relative weight of micro and small enterprises in any given economy, this paper aims at reinforcing awareness on the need to further the study of the decision-making process in such firms.
... The research of the social dimension promotes understanding of the organizational dimension, in particular, of the family-owned business (Montaño, 2007). Nevertheless, there are certain divergences in their behavior, mainly due to the interaction of the family, in aspects such as in the business itself, ownership, and management ( Jorissen, Laveren, Martens & Reheul, 2005;Chrisman, Chua & Sharma, 2005;Fitzgerald, Haynes, Schrank & Danes, 2010;Chrisman, Sharma, Steier & Chua, 2013;Esparza, García & Duréndez, 2016). Both internal and external particular characteristics generate different behaviors toward the development of CSR practices. ...
... Family-owned businesses manage their firm in different ways, and these forms of management are mainly determined by the interaction of the family in aspects such as the business, ownership, and management ( Jorissen et al., 2005;Chrisman, Chua & Sharma, 2005;Fitzgerald et al., 2010;Chrisman, Sharma, Steier & Chua, 2013;Aoi, Asaba, Kubota & Takehara, 2015;Esparza et al., 2016). These characteristics indicate that this type of businesses also possesses different behaviors toward the development of CSR practices (Martín & Aroca, 2016;Lamb, Butler & Roundy, 2017). ...
... This variable shows the natural logarithm of the average number of business employees during the studied period. The number of employees has been extensively used as a size measurement in these types of research studies, such as Daily and Dollinger (1993) and Esparza, García and Duréndez (2016). ...
The aim of this article was to determine whether the strategic orientation of family-owned businesses influences Corporate Social Responsibility (CSR) practices. For this purpose, a questionnaire
was administered to a sample of 245 family-owned businesses in the southern part of the southeastern Mexican state of Quintana Roo. Variables attributed to CSR measurements were environment, society,
employees, and customers, as well as business-level strategies of prospector, analyzer, defender, and reactor as defined by Miles and Snow. Results showed that family-owned businesses with a strategic
orientation as prospector and analyzer have higher development levels of CSR practices, reactor businesses demonstrated lower development levels of CSR practices. Prospector and analyzer businesses tend to be product developers and innovators in their respective markets.
... The economic impacts of ICTs are particularly crucial, given that the tourism and hospitality industry is a for-profit sector operating to achieve economic outcomes. These outcomes encompass revenue and profit increases (e.g., Hua et al., 2020;Qian and Zhang, 2023), frequency of visits (e.g., Jiang and McCabe, 2021;Liu and Shi, 2019), and improvements in productivity, time-saving, and cost-effectiveness (e.g., Esparza-Aguilar et al., 2016;Melián-González and Bulchand-Gidumal, 2016). These outcomes are manifestations of diverse functions at the property, corporate, and destination levels of the tourism and hospitality industry, thereby comprehensively scrutinizing the relevant stakeholders for further evaluation. ...
... The study also indicated that IT can enhance employees' productivity, as they can focus more on customer interactions when routine tasks are automated. Esparza-Aguilar, García-Pérez-de-Lema, and Duréndez (2016) found that the use of a management control system positively impacts the performance of family and non-family SMEs in the hospitality industry by improving internal processes. The literature also highlighted that ICTs can increase operational efficiency by saving time. ...
Recognizing the pivotal role of information and communication technologies (ICTs) in generating economic benefits within the tourism and hospitality industry, this research aimed to develop a comprehensive understanding of the economic impacts of ICTs through a systematic review of the literature published on this topic since 2000. Synthesizing the information shared in 60 articles, this research presents the methodological approaches and identifies that the economic impacts of ICTs can be categorized into performance (financial and operational), operational efficiency (e.g., cost reduction and operation time saving), and market (e.g., popularity and reputation). Furthermore, this research discusses potential directions for future studies examining the economic impacts of ICTs. The present research contributes to the literature by synthesizing knowledge on the economic impacts of ICTs in the tourism and hospitality industry. The findings also serve as a valuable reference for industry practitioners seeking to navigate the extensive body of knowledge in this field.
... In this context, technology is shown to be crucial for the implementation of an overall performance measurement system [66], reducing information asymmetries and agency costs [128]. Specifically, Kang et al. [129] show how the Sustainability Balanced Scorecard (SBSC) is used as a systematic tool for business management to assess the performance of the hotel industry and ensure the achievement of business goals and vision. ...
... In the SBSC, the business is divided into five dimensions: financial, customer, internal business, learning and growth, and nonmarket perspective. In spite of the fact that the resource limitation affecting FB [49] requires strict management practices [66], managers of FB-particularly MSMEs [130] in the H&T industry-seem to use less accounting and financial information than their nonfamily-business counterparts [128]. 113 owner-managers of SMEs tourism firms from from the tourism and hospitality industry in the Austrian Chamber of Commerceʹs database of ownermanager led firms; 13 face-toface interviews with these respondents Entrepreneurial orientation, financial resource, environmental uncertainty, performance Six different configuritons, which can be grouped grouped into high or low environmental uncertainty settings and highlight the relevance of multidimensional Entrepreneurial Orientation (EO), financial endowment, and personal and professional networks to high firm performance Small and medium companies INTERNA-TIONAL JOURNAL OF HOSPITAL-ITY & TOUR-ISM ADMIN-ISTRATION 8 Karatepe, OM 2009 ...
Family businesses are of particular economic relevance in the international hospitality and tourism industry. However, there are few studies that address their specific characteristics and objectives. The aim of this study is to produce a bibliometric overview that reveals the structure underpinning the analysis of the tourism family business in the business and management research field. The study also reveals the evolution of this research over time, as well as the most relevant related concepts and study gaps. Through a keyword co-occurrence analysis and a systematic review of 129 studies on tourism family businesses published between 1997 and 2020, the main contributions were organized into four thematic clusters, which include specific theoretical approaches. The clusters are Entrepreneurship, Marketing Orientation and Innovation Performance; Capabilities and Competitiveness; Sustainability; and Strategy and Economic Performance. On the basis of these results, this study introduces an integrative framework for tourism family business research, clarifying the rich diversity of research paths that seek to explain tourism business competitiveness, and identifying potential directions for future research aimed at further developing the field.
... Although management accounting systems have been extensively studied in large companies and manufacturing companies, studies involving small and medium-sized hotel companies are relatively rare (Sooraboyen and Poorundersing, 2008;Alvarez et al., 2014;Esparza-Aguilar et al., 2016;Vicente and Ivanov, 2017;Cengiz et al., 2019). Furthermore, as pointed out by several scholars (Burgess, 2002;Ismail &King, 2006, Bello andSensini, 2020;Campos et al., 2019), the results obtained for larger companies and those belonging to different sectors may not be significant. ...
... However, most of these studies focused mainly on hotel businesses in developed economies. Studies on this issue in emerging economies are relatively rare (Cengiz et al., 2019;Esparza-Aguilar et al., 2016;Vicente and Ivanov, 2017). ...
This paper focuses on hotel SMEs in Buenos Aires province to assess the spread of management accounting systems and their impact on business performance. We have selected companies with a stratified method to have a more meaningful sample based on an economic criterion. The data were collected through the use of a questionnaire organized into three sections. We used a quantitative approach to analyze MAP systems' influence on the user and non-user companies' performance. The results highlighted positive and statistically significant relationships between most management accounting tools and hotel business performance, suggesting that MAP users perform better than non-users. Finally, companies that already use management accounting techniques have shown a strong interest in the new Strategic Management Accounting (SMA) tools, even if they consider budgeting techniques fundamental. On the other hand, MAP non-adopting companies strongly focus on traditional management accounting tools, such as cost accounting systems and budgeting.
... As such, it was very critical to supply timely, faithful and accurate financial information (Lestari et al., 2021). In this regard, information and planning systems was pondered as a helpful instrument for the achievement of organizational goals (Esparza-Aguilar et al., 2016). Based on the perspectives of Lutfi et al. (2022), ...
The current research aims to unveil the interconnection between effectiveness of digital accounting information system (EDAIS) and sustainable business model innovation (SBMI). In particular, the study investigates the mediating function of digital business ecosystem (DBE) between EDAIS and SBMI. In this regard, this study confirms and establishes the relationships between EDAIS, DBE, and SBMI by using a sequential exploratory strategy that combines literature review and qualitative interviews, together with a quantitative survey of 723 small and medium enterprises (SMEs). The results analysis indicated that EDAIS had a positive impact on SBMI. Furthermore, it was shown that DBE had a role in partially mediating the relationship between EDAIS and SBMI. Therefore, it is recommended that practitioners adopt digital transformation and harness national policies, in order to improve their company's use of digital technology in accounting. Additionally, policymakers and practitioners can use this investigation to enhance their comprehension of the governance of DBE and to elucidate strategies, procedures, and management for DBE in order to establish and attain SBMI in the digital environment.
... However, there are still gaps in research regarding the implementation of AIS in Medan culinary MSMEs (Esparza-Aguilar, 2016;Lestari, 2019). Previous research often focuses more on general factors influencing information technology adoption without investigating in depth the unique context of culinary MSMEs. ...
Culinary Micro, Small and Medium Enterprises (MSMEs) are an important sector in the Indonesian economy. In Medan, this sector has developed significantly, encouraging many entrepreneurs to set up culinary businesses. However, many of them still have difficulty managing their finances effectively. This can hinder the growth and development of their business. The implementation of an Accounting Information System (AIS) can help culinary MSMEs manage their finances effectively. This research aims to analyze the influence of educational factors, business experience and business scale on the implementation of AIS in culinary MSMEs in Medan. The research method used is analysisliterature. The research results show that the factors of education, business experience, and business scale have a positive influence on the implementation of AIS in culinary MSMEs in Medan.
... This kind of research will be incredibly precious when connected with developing AIS research in Indonesia. The reason for choosing Indonesia is because looking at comparative data regarding the use of AIS/IT in several countries in the world shows that developed countries such as the USA or other developed countries have adopted and integrated AIS well in their business practices (Al-Hattami, 2021;Esparza-Aguilar et al., 2016). However, in Indonesia, despite the increase in the use of information technology in the accounting field, the level of AIS adoption is still considered low, especially among small and medium enterprises (Meiryani et al., 2019). ...
... This kind of research will be incredibly precious when connected with developing AIS research in Indonesia. The reason for choosing Indonesia is because looking at comparative data regarding the use of AIS/IT in several countries in the world shows that developed countries such as the USA or other developed countries have adopted and integrated AIS well in their business practices (Al-Hattami, 2021;Esparza-Aguilar et al., 2016). However, in Indonesia, despite the increase in the use of information technology in the accounting field, the level of AIS adoption is still considered low, especially among small and medium enterprises (Meiryani et al., 2019). ...
... The findings revealed a highly favorable response to financial reports among computerized accounting systems firms (McChlery et al., 2005). Utilizing financial statements, cash flow information, and interim financial reports has a substantial and beneficial influence on the success of a family business (Esparza-Aguilar et al., 2016). There exists a noteworthy association between the extent and regularity of financial reporting and the assessment of small and medium-sized enterprises growth and performance (McMahon, 2001). ...
The viability of Small and Medium Enterprises is heavily reliant on effectively managed firm finance management. Utilizing technology and information through an Accounting Information System is beneficial for businesses as it aids in the management of financial transactions, financial reporting, and financial decision-making. This article employs the Systematic Literature Review research methodology, utilizing several papers indexed by Scopus from 2015 to 2024. Researchers investigate the characteristics that facilitate the adoption of Accounting Information Systems in Small and Medium Enterprises (SMEs) and their influence on corporate performance to ensure the long-term viability of SMEs in the face of business challenges and advancements. An Accounting Information System is crucial for assessing the progress of SME businesses and obtaining assistance from internal and external stakeholders. This is particularly important given the significant influence that Small and Medium Enterprises have on the national economy
... Los pocos estudios disponibles que han abordado a EF mexicanas MIPYMES, desde una perspectiva financiera concluyen que las EF veracruzanas utilizan en menor medida la contabilidad de costos en comparación con las ENF (García Pérez de Lema, Martín Hernández, y Martínez García, 2006); en las EF turísticas del estado de Quintana Roo el efecto familiar influye de manera positiva en la rentabilidad de las empresas, a pesar de que estas no suelen utilizar información financiera para su toma de decisiones (Esparza-Aguilar et al., 2010) y el uso de información financiera tiene un efecto positivo en el desempeño financiero de las EF (Esparza-Aguilar et al., 2016). Sin embargo, el número de publicaciones aún es incipiente si se considera que México cuenta con 4.8 millones de unidades económicas (INEGI, 2019) y alrededor del 83% de estas son de tipo familiar (Belausteguigoitia Ruiz et al., 2021;San Martín Reyna y Durán Encalada, 2017), por lo cual, el presente estudio tiene como objetivo comparar indicadores de desempeño financiero entre EF y ENF, privadas en México. ...
A pesar de la importancia de las empresas familiares (EF) en la economía mexicana, por su número y empleos generados, su estudio sigue siendo limitado especialmente cuando se trata de empresas que no cotizan en el mercado bursátil. Con la intención de contribuir a su entendimiento el objetivo del presente estudio es comparar variables de desempeño financiero entre EF y empresas no familiares (ENF) privadas, en México. El método de investigación utiliza pruebas de contraste no paramétrico para analizar la información de3,170 empresas, a partir de la Encuesta Nacional de Financiamiento de las Empresas (ENAFIN). Con el sustento de la teoría de agencia, los resultados muestran diferencias estadísticamente significativas en ingresos, egresos, utilidades netas, activos y gastos financieros. Los hallazgos señalan que las EF medianas superan en ingresos, activos y costo de financiamiento a las ENF. La originalidad del análisis reside en la mayor muestra empleada, hasta donde tenemos conocimiento, en este tipo de estudios en México. La falta de consenso para identificar las EF, así como su grado de heterogeneidad pueden ser limitaciones importantes del estudio. Ante la falta de estadísticas oficiales sobre las características de las EF, los resultados ofrecidos pueden ser utilizados por distintos agentes económicos interesados en su comportamiento.
... In the study conducted by lavia and Hiebl (2015), it was established that small and medium sized firms which used management accounting registered improved performance and long-term development. Additionally, the application of management accounting tools has also been documented to improve rate of Interest (ROI) in microenterprises while Esparza (2016) found that the application and use of cash flow-related tools had an impact on performance. As a result, it is expected that those microenterprises, small and medium firms which use management accounting tools have improved performance. ...
The current study sought to explore and understand how te use of management accounting techniques in microenterprises affects those entities. Precisely, the study focused on examining how the application of management accounting tools affects microenterprises. The research methodology employed in this study involved collecting data from journals, articles, publications, and relevant empirical studies. The collected data was analyzed through common themes generated from the project documentation. The results of the study depicted that management accounting practices such as cost system analysis, budgeting and providing accounting information improved the performance of microenterprises. Besides, these tools were evidently supported as essential elements in decision making as far micro enterprises are concerned. The study recommends that microenterprises should focus on budgeting, cost system analysis and using accounting information as their key drivers in decision making. Besides, the study proposed further research to be done with empirical studies to gauge whether the conclusions drawn will be the same.
... In the literature, several relationships between the information provided by the MAS and other business variables have been studied. In some studies, information dimensions are used as dependent variablesBouwens and Abernethy, 2000;Chiou, 2011;Ern, Abdullah and Yau, 2016;Ghorbel, 2019), in other studies as independent variables(Chang, Chang and Paper, 2003;Agbejule, 2005;Mollanazari and Abdolkarimi, 2012;Esparza-Aguilar, García-Pérez-De-Lema and Duréndez, 2016), and in some other studies, they are both dependent and independent variables(Soobaroyen and Poorundersing, 2008;Etemadi et al., 2009;Hammad, Jusoh and Ghozali, 2013;Ismail, Isa and Mia, 2018;Ghasemi et al., 2019;Hariyati, Tjahjadi and Soewarno, 2019). ...
Purpose
The purpose of this paper is to explore the impact of the characteristics and roles of management accounting systems (MAS) on today’s business organizations and their management, systems, procedures, people, performance and competitive environments.
Design/methodology/approach
A survey-based methodology was utilized in this research to gather organizational information relevant to the different facets of the MAS and their operational and strategic practices impact on organizations operating under increasingly uncertain and competitive environments. A structural equation modeling approach was utilized to uncover relevant relationships and associations among relevant variables.
Findings
The findings of this exploratory research revealed a direct influence of MAS on the managerial and organizational performance through the managers’ performance. The results also suggest that MAS is directly influenced by users’ training, and satisfaction, task uncertainty and decentralization of decisions. It was also indirectly influenced by top management support. In addition, the findings also revealed a direct influence of the decentralization of decisions on the managers’ and on organizational performance.
Research limitations/implications
While this study addressed important issues that have practical management value, it is limited to a sample from one country. Future studies in different businesses and cultural settings are needed to enhance the theoretical and practical contributions of the findings and conclusions of this study.
Practical implications
The issues explored in this study are very much relevant to the utilization and design of MAS and their increasing tactical and strategic roles in the management of today’s business organizations. The findings of this study have relevant practical value for managers as they attempt to cope with increasingly competitive environments through the deployment of their existing capabilities and best practices. In this context, the accounting management system has practical utilities that facilitate the control and management of the operations and strategies of the organization.
Originality/value
This research offers practicing management an integrated approach, as they aspire to utilize their organizational MAS to increase the efficiency and effectiveness of their organizations. Integrating the different aspects of management accounting information systems, given their impact on the different aspects of the organization, is needed for the establishment of theoretical research models aiming at the enhancement of the competitive performance of today’s organizations. This study also offers to executives of small and medium enterprises (SMEs) a new multidimensional instrument for assessing the effectiveness of their management information systems, which can help to improve their benchmarking processes.
... In definitiva, le specificità delle imprese familiari influenzano l'adozione degli strumenti di controllo. Le teorie della stewardship e del SEW aiutano a spiegare le ragioni che inducono la prevalenza delle imprese familiari ad adottare sistemi di controllo meno formali rispetto alle imprese non familiari (Broccardo et al. 2016;Esparza-Aguilar et al. 2016;Jorissen et al. 2005). ...
Management Control in Family Business. A Literature Review
In the last few years the relevance of family firms in the global economy has foster the scientific debate on this field. The specific characteristics of these business make the analysis of management control tools used by family firms particularly interesting. Given the growing attention to this topic, through a systematic literature review, this paper intends to outline the main issues on the use of management control and management accounting tools in family businesses. The results show three main streams of literature: 1) the element that differentiate the management control choices of family firms from non-family firms; 2) the influence of the leadership style on the use of formal or informal management control tools; 3) the development of management control system in particular stages of the family firm’s life, such as professionalization of the business, and generational succession.
The whole analysis reveals that there is an open space for the scholars interested in the development of managerial studies aimed at offering new contributions to family businesses, to identify management control tools able to adapt to the specific characteristics and context of this type of organization.
Keywords: family business, family firms, management control, management ac-counting, literature review
... Logistic information integration also foster timely information interchange which is essential in handling changes within the organizational processes to meet up to the customer requirement (Ketikidis, Koh, Dimitriadis, Gunasekaran & Kehajova, 2008;Voronkova, Kurochkina, Firova & Bikezina, 2017). Accordingly, logistic information integration capability plays a crucial role in enhancing morbidity of goods and services, which relies on logistics capability information processing ( Zhu et al., 2018), information linkages ( Maiga et al., 2015;Bhattacharya & O'Hara, 2018;Nikolova-Jahn et al., 2018), information flexibility (Han, 2016;Chen et al., 2017;Han et al., 2017), information control systems ( Esparza-Aguilar et al., 2016;Ahmad & Mohamed, 2017), information technology ( Wang et al., 2015). Moreover, information integration capabilities of a firm may ensures unhindered access to documents that can be used to improve operational efficiency of the organization (Gunasekaran, Papadopoulos, Dubey, Wamba, Childe, Hazen & Akter, 2017b). ...
Firms may improve their performance by integrating their logistic capabilities in their daily operations. However, the valence/attributes of logistic capabilities used by the firms could potentially affect the overall relationships between logistic capabilities and firm performance. Therefore, this study determined the influence of the valence of logistic information integration capability and firm performance of manufacturing firms in Kenya. The study adopted explanatory research design. The target population comprised of 750 manufacturing firms registered under Kenya Association of Manufacturers from where a sample size of 442 firms were selected using stratified and simple random sampling approaches. The study demonstrated that each valence of logistic information integration capability has a significant effect on performance. Therefore, whenever firms aim at optimizing logistic information integration capabilities, the firms must pay more attention to each valence. Therefore, exploring avenues of improving each valence, logistic information integration capability firms may eventually improve the overall performance of the manufacturing firms.
... Las empresas familiares en todo el mundo tienen ciertas características en su comportamiento, principalmente por la interacción de la familia en aspectos como la empresa, la propiedad y la gestión (Fitzgerald, Haynes, Schrank y Danes, 2010;Chrisman, Sharma, Steier y Chua, 2013;Esparza, García y Duréndez, 2016). Estas características, tanto internas como externas, influyen en que dichas empresas difieran en comportamientos relacionados con el desarrollo de prácticas de RSE y, por consiguiente, en la obtención de ventaja competitiva (Habbershon, Williams y MacMillan, 2003;Vilanova, Lozano y Arenas, 2009;Hammann, Habisch y Pechlaner, 2009;Sweeny, 2009). ...
The aim of this paper is to identify the effects of Corporate Social Responsibility (CSR) practices developed by family MSMEs on competitive success and innovation. A survey was directly applied to the managers/ owners of a sample of 245 family business in the southern state of Quintana Roo, Mexico. A theoretical model has been proposed with hypotheses to be tested, and it has been validated with a structural equation model (SEM). The results obtained show that CSR practices developed by family MSMEs have a positive and statistically significant effect on competitive success and innovation. In terms of innovation and competitive success, CRS has a positive effect, but not a significant one.
... Las empresas familiares en todo el mundo tienen ciertas características en su comportamiento, principalmente por la interacción de la familia en aspectos como la empresa, la propiedad y la gestión (Fitzgerald, Haynes, Schrank y Danes, 2010;Chrisman, Sharma, Steier y Chua, 2013;Esparza, García y Duréndez, 2016). Estas características, tanto internas como externas, influyen en que dichas empresas difieran en comportamientos relacionados con el desarrollo de prácticas de RSE y, por consiguiente, en la obtención de ventaja competitiva (Habbershon, Williams y MacMillan, 2003;Vilanova, Lozano y Arenas, 2009;Hammann, Habisch y Pechlaner, 2009;Sweeny, 2009). ...
El objetivo del presente trabajo es identificar los efectos que tienen las prácticas de Responsabilidad Social Empresarial (RSE) desarrolladas por mipymes familiares en el éxito competitivo y la innovación. Para esto, se ha utilizado una muestra de 245 empresas familiares en el sur del estado de Quintana Roo, México, a través de la aplicación de un cuestionario a los gerentes/propietarios. Se ha propuesto un modelo teórico con las hipótesis a contrastar, y se ha validado con un modelo de ecuaciones estructurales (SEM por sus siglas en inglés). Los resultados obtenidos muestran que las prácticas de RSE desarrolladas por las mipymes familiares tienen un efecto positivo y estadísticamente significativo en el éxito competitivo y en la innovación. En cuanto a la innovación y su efecto en el éxito competitivo, fue positivo, pero no significativo.
This study analyses the short-term market effect of CrowdStrike IT outage in the 100 largest worldwide listed hotel companies. Using an event study methodology, the paper analyses how hotel companies are penalized by the market to the biggest IT disruption in history. Our results evidence a statistically significant negative reaction around the event date. This result is explained by the adverse impact caused by IT failures in the hotel’s business operations (reservation, payment, technical systems) and supply chain processes, which result in financial losses. We also observe a highest negative stock market reaction for hotel companies located in Western countries and for hotels with a low cyber risk rating. Finally, this study identifies hotel-specific characteristics that drive value during an IT outage. The research evidence that larger and more profitable hotel companies, with lower leverage and higher cyber risk ratings are more resilient to the adverse effects of IT outages.
Academic researchers have recently recognised the impact of family firms’ idiosyncrasies and characteristics on financial accounting practices, and identified distinctions between family and non-family businesses. However, this issue still needs appropriate systematisation and discussion. It is important to understand how family businesses’ features shape financial accounting phenomena, but the most authoritative review on the topic dates back more than 10 years. We therefore conducted a systematic review of 133 articles on financial accounting in family firms published in peer-reviewed journals up to 2023. We aimed to assess what scholars have explored so far on this topic, interpreting findings using three levels of analysis: family, business, and individual. The novelty of our paper comes from using this framework to create a thematic map that provides a comprehensive overview of the current research on this topic and developing an extensive research agenda for future studies. The article also provides practical implications for family firm managers, practitioners, and regulators by clarifying the influence of characteristics of family businesses on accounting practices.
The purpose of this study is to examine the mediator role of Accounting Information Systems (AIS) between organizational Culture (OC) and Organizational Performance (OP) in Small and Medium Enterprises (SMEs). This study surveyed SMEs employees in Iraq, which were selected using the convenience sample technique. The data were tested for validity and reliability, and finally, 212 valid questionnaires were analyzed using Smart-PLS. The results indicated that the AIS mediated the relationship between OC and OP, while OC and AIS significantly impacted OP. This study also found a significant impact of OC on AIS. The SME managers and owners should pay more attention to the importance of AIS and develop the culture that will lead to implementing the AIS to enhance OP. Overall, the study enriches the body of knowledge and extant literature by examining the OC, AIS and OP among SMEs in developing countries, particularly Iraq.
Micro, Small, and Medium Enterprises (MSMEs) play a significant role in the national economic growth. This has made the performance of MSMEs a concern for many parties, including the government, which necessitates efforts to continuously maintain and enhance their performance. The performance of MSMEs is greatly determined by how they design, implement, and manage their business strategies. Designing appropriate business strategies can provide support for MSMEs in achieving superior and sustainable performance over the long term. Business strategies that focus on growth and competitive advantage often require innovation in their implementation. To help identify the necessary resources in the implementation of business strategies, Accounting Information Systems (AIS) are also required. The objective of this research is to test the relationship between business strategies and the performance of micro-enterprises through innovation and AIS in MSMEs. The research population consists of MSMEs in the food and beverage sector in the city of Malang. The data analysis tool used is Structural Equation Modelling (SEM).
Small enterprises are exposed to new challenges in examining the impact of creative accounting on their financial statements, particularly when assessing ‘going concerned’ conditions and increasing the risk of fraud. The article aims to identify accounting errors and fraud risks made by accounting adjustments, thus distorting the true and fair presentation of financial statements. We aim to explore the risks of creative accounting based on the relationship between profit creation (EBT) and cash flow (CF) by applying the CFEBT risk triangle method. We analyze small enterprises operating mainly in the trade, processing, and construction industry to achieve this. The detected risks of accounting records were subsequently compared and evaluated in the selected branches of activities. Our research findings confirmed that M-score values were primarily negative for the monitored industries of small enterprises. The resulting values point to applying creative accounting methods – earning management, which pursues, in particular, tax optimization, and, on the other hand, the fulfilment of profitability criteria. A more profound analysis of selected accounting items and financial indicators confirmed more substantial differences between the trade and construction industries. Differences between the branches were found in one-half of the financial indicators and most of the 14 accounting items monitored. The accounting risks ascertained may be used as a tool for reducing the information asymmetry between authors of accounting records and users of reported accounting data and information. The detection and evaluation of risks of accounting errors and errors beyond the economic substance of reported data may considerably improve the quality of decision-making of internal and external users and is also used by persons authorized to conduct the administration and Corporate Governance for increasing the efficiency of enterprises’ internal control systems.
Small businesses contribute to society on many fronts: job creation, tax revenues, functional products and services, charitable donations, technological developments, and social contributions to communities. Given these contributions, and small firms’ limited resources, it is important to understand what strategic management practices (SMPs) – activities engaged to develop and implement strategy – positively impact small firm performance. Small business leaders may apply various combinations of SMPs to achieve performance objectives. Here, we apply Fuzzy set Qualitative Comparative Analysis (fsQCA) to explore how various combinations of six different SMPs – entrepreneurial orientation (EO), strategic planning, goal setting, total quality management (TQM), social capital, and small business owners’ analysis of financial ratios – affect performance. From a sample of U.S. printing companies, we found four different configurations of SMPs related to higher small business performance.
Purpose
The purpose of this paper is to identify the CSR practices developed by Mexican family and non-family MSMEs. The study also aims to compare the CSR practices carried out by family and non-family businesses in a country with an emergent economy.
Design/methodology/approach
The paper opted for an exploratory study using a sample of 384 businesses was selected in the southern state of Quintana Roo, Mexico, distributed in 245 family and 139 non-family businesses and a questionnaire was applied directly to the managers/owners.
Findings
The results show that family MSMEs develop CSR practices to a higher extent than non-family ones, mainly on environment and societal dimensions. In addition, CSR practices in family-owned enterprises develop to a higher extent when the manager/owner has more years of experience in the business, has a higher university education and the size of the business is larger.
Research limitations/implications
The study was developed exclusively with a MSMEs sample with a scope only on the southern part of Quintana Roo, Mexico; the shortage of business databases and the stratification of businesses based exclusively on the number of employees. This work presents information that contributes to the state of the art, broadening the existing literature related to CSR in businesses of a country with an emergent economy and an environment where the tourism and commercial sectors predominate.
Practical implications
This paper provides information to government institutions for the establishment of public policies targeted for an increase of CSR activities by businesses in the area. Manager and/or owners can understand the importance of implementing CSR activities within the business as a competitive strategy. It is also important for universities, professors/researchers and for all interested parties.
Originality/value
This paper provides theoretical and empirical evidence about CSR practices carried out among family and non-family MSMEs in an emergent economy.
Does owner management necessarily eliminate the agency costs of ownership? Drawing on agency literature and on the economic theory of the household, we argue that private ownership and owner management expose privately held, owner-managed firms to agency threats ignored by Jensen's and Meckling's (1976) agency model. Private ownership and owner management not only reduce the effectiveness of external control mechanisms, they also expose firms to a "self-control" problem created by incentives that cause owners to take actions which "harm themselves as well as those around them" (Jensen 1994, p. 43). Thus, shareholders have incentive to invest resources in curbing both managerialand owner opportunism. We extend this thesis to the domain of the family firm. After developing hypotheses which describe how family dynamics and, specifically, altruism, exacerbate agency problems experienced by these privately held, owner-managed firms, we use data obtained from a large-scale survey of family businesses to field test our hypotheses and find evidence which suggests support for our proposed theory. Finally, we discuss the implications of our theory for research on family and other types of privately held, owner-managed firms.
During the years of Lithuanian economic independence, much emphasis is laid on financial accounting and auditing, whereas management accounting has been languishing in the background.
This paper investigates the role and development of management accounting and the usefulness of its information perceived by managers. The management accounting system is characterized in terms of information. These characteristics are: scope, timeliness, the level of aggregation, and information which assists integration.
Empirical support for the relationship between the features of management information and its perceived usefulness is provided using data gathered from questionnaires and interviews. The search for usefulness of management accounting information was guided by the accounting research literature. The goal has been to determine what features of information are recognized by managers and accountants as useful.
The results of analysis have shown that all interviewed managers perceived management accounting (economic and non-economic) information as useful. However, the level of their scores has been higher than that of accountants.
There had been no comprehensive study involving the evaluation of usefulness of accounting information by Lithuanian managers. The present study has been undertaken to learn more about how Lithuanian managers perceive the usefulness of management accounting information. This was the principal objective of this research. Since managers’satisfaction with the accounting system could be highly biased, the next objective was to determine whether accountants perceived the same features of information as useful. The third objective of this study was to review the possibilities for the development of management accounting systems.
Thus, the purpose of this paper was to examine the perception of usefulness of accounting information by its suppliers and users.
The paper proceeds as follows. We describe management accounting, its role and development. We provide a framework for the survey based on a review of the extensive literature on research published by foreign management accounting journals during the period 1980-2005, including Accounting, Organizations and Society. The Accounting Review, Contemporary Accounting Research, Journal of Accounting and Economics, Journal of Management Accounting Research, Strategic Finance, Business and Finance History. Cost Accounting Magazine, Management Accounting Quarterly. A survey and its statistical analysis are presented. The final section contains conclusions.
Using an agency-theoretic lens and insights drawn from the behavioral economics and family business literatures, we developed hypotheses concerning the effect of dispersion of ownership on the use of debt by private family-owned and family-managed firms. A field study of 1,464 family firms was conducted. Results suggest that, during periods of market growth, the relationship between the use of debt and the dispersion of ownership among directors at family firms can be graphed as a U-shaped curve.
Innovation facilitates how SMEs respond to market changes and maintain their competitive advantage. This paper analyses the relationship between the degree of innovation (measured as innovation in products, processes and administration systems) and performance among 1,091 Spanish manufacturing SMEs. The results show that innovation positively impacts SMEs performance in low and high technology industries. Innovation was more important to achieving a competitive advantage to high technology firms than low technology firms. These results support innovation as being important to a firm's sustainable competitive advantage.
This study focuses on the relationship between the design of the management accounting system, management style and the effects on organisational performance. This paper analyses the links between these variables based on a contingency approach. It contributes to the existing literature by providing additional evidence on the relationships between these variables within the public healthcare sector. The study distinguishes between innovative vs. traditional management accounting system designs and proactive vs. reactive management style. Data is collected from CEOs in public hospitals. A two-fold analysis involving interviews and a questionnaire was adopted thus enabling a systematic and comprehensive analysis.
The concept of alignment or fit between information technology (IT) and business strategy has been discussed for many years, and strategic alignment is deemed crucial in increasing firm performance. Yet few attempts have been made to investigate the factors that influence alignment, especially in the context of small and medium sized firms (SMEs). This issue is important because results from previous studies suggest that many firms struggle to achieve alignment. Therefore, this study sought to identify different levels of alignment and then investigated the factors that influence alignment. In particular, it focused on the alignment between the requirements for accounting information (AIS requirements) and the capacity of accounting systems (AIS capacity) to generate the information, in the specific context of manufacturing SMEs in Malaysia. Using a mail questionnaire, data from 214 firms was collected on nineteen accounting information characteristics for both requirements and capacity. The fit between these two sets was explored using the moderation approach and evidence was gained that AIS alignment in some firms was high. Cluster analysis was used to find two sets of groups which could be considered more aligned and less aligned. The study then investigated some factors that might be associated with a small firm's level of AIS alignment. Findings from the study suggest that AIS alignment was related to the firm's: level of IT maturity; level of owner/manager's accounting and IT knowledge; use of expertise from government agencies and accounting firms; and existence of internal IT staff.
Purpose
This study aims to examine the availability and effectiveness of management accounting systems (MAS) for functional managers located in an African developing country (Mauritius).
Design/methodology/approach
Based on the MAS dimensions defined by Chenhall and Morris, a contingency‐based “intervening” model is proposed whereby available MAS play a significant intervening role between task uncertainty (TU) and decentralization (DEC) on managerial performance. Using survey data from production and marketing managers in manufacturing companies and regression‐path analysis, the MAS dimensions (scope, aggregation, integration, and timeliness) are collectively analyzed in relation to the situational variables and managerial performance.
Findings
A significant positive relationship was observed between all MAS characteristics and managerial performance. However, only DEC proved to be a contextual variable of interest, in that DEC policies appear effective only via the availability of broader scope, timely, highly aggregated and highly integrated MAS. The absence of findings for TU is suggestive of an “uncertainty paradox,” previously referred to in the literature, and is indicative of the need to re‐consider TU as an element of “technology” rather than “uncertainty.”
Research limitations/implications
This study focused only on manufacturing companies and its findings may not be applicable to other organizational contexts, e.g. service enterprises.
Originality/value
This study focuses on actual availability of MAS as perceived by users in manufacturing companies rather than on studies which rely on accountants' perceptions, on hypothetical “usefulness” perceptions of MAS or on the sole use of the scope dimension.
Using social networks, we examined the founder’s influence on key strategic behaviors in Mexican family business. First, we drew on a sample of 42 Mexican family businesses and 201 managers to show how founder centrality affects the top management group (TMG) members’ cohesiveness. TMG members’ cohesiveness was examined in terms of the firm’s culture, its strategic vision, and strategic goals. Second, we examined how founder centrality and top management member group cohesiveness are related to performance in terms of financial, social and family-oriented objectives. Significant relationships were found between a founder’s centrality and the TMGs strategic behavior. Further, significant results connect different aspects of the founder’s centrality and the TMGs strategic behavior to financial, social and family-oriented objectives.
We rely on a unique data set to estimate the impact of disclosure standards and auditor-related characteristics on ownership concentration in 190 privatized firms from 31 countries. Accounting transparency can help alleviate the agency conflict between minority investors and controlling shareholders, which is evident in the extent of ownership concentration, since the expropriation of corporate resources hinges on these private benefits remaining hidden. After controlling for other country-level and firm-level determinants, we find weak (no) evidence that extensive disclosure standards (auditor choice) reduce ownership concentration. In contrast, we report strong, robust evidence that ownership concentration is lower in countries with securities laws that specify a lower burden of proof in civil and criminal litigation against auditors, consistent with Ball's [2001] predictions. Collectively, our research implies that minority investors worldwide value legal institutions that discipline auditors in the event of financial reporting failure over both the presence of a Big 5 auditor and better disclosure standards. Re-estimating our regressions on a broad sample of western European public firms provides similar evidence on all of our predictions. Copyright University of Chicago on behalf of the Institute of Professional Accounting, 2006.
Sumario: La preparación de los sucesores -- La organización y su preparación para la sucesión -- El desarrollo de las relaciones entre la familia y la empresa -- Retirarse: prepararse y hacerlo -- Sucesión de segunda a tercera generación -- La sucesión cuando la propiedad está repartida en dos partes iguales -- Casos empresariales
The scale of family company activity in the United Kingdom was measured with regard to several family firm definitions. This study confirms that family companies are a numerically important group of businesses. Policy makers and practitioners must, however, be aware that the scale of family firm activity in any developed economy is highly sensitive to the family firm definition selected. Within a bivariate as well as multivariate statistical framework, marked demographic differences were identified between family and non-family companies with regard to several family firm definitions. We suggest that bivariate studies comparing the management practices and performance of family and non-family firms may have identified ‘demographic sample’ differences rather than ‘real’ differences. Implications for future research exploring the management and performance of family and non-family firms are discussed.
Thesis (Ph. D.)--University of Minnesota, 1980. Includes bibliographical references (p. 91-94). Photocopy.
Adopting management accounting systems are important events in the life of young and growing companies. Using a sample of 78 startup companies, we document cross-sectional differences in the adoption of operating budgets as well as seven other management accounting systems. We find that our proxies for agency costs, perceived benefits and costs, company scale, and top management style explain cross-sectional differences in the time-to-adoption of budgets. In particular, the presence of venture capital, CEO experience, presence of a financial manager, number of employees, and the CEO beliefs about management planning systems are associated with this adoption decision. We further investigate the effect of hiring a financial manager as an endogenous variable. In the first stage of a two-stage model, we find that CEO experience, the presence of venture capital funds, CEO beliefs about management accounting systems, and number of employees are associated with crosssectional variation in this hiring decision. When treating this decision as endogenous, time-to-hiring a financial manager is unrelated to operating budget adoption. The paper also examines the association between the time-to-adoption of operating budgets and company performance. We find a significant increase in the number of employees of the company around the adoption of operating budgets; moreover, faster adoption of operating budgets is associated with faster growing companies. We extend the findings to additional management accounting systems including: cash budgets, variance analysis, operating expense approval policies, capital expenditure approval policies, product profitability, customer profitability, and customer acquisition costs. The influence of industry (biotechnology, information technology, or non-tech) is examined in each stage of the research.
This paper investigates whether the financial reporting practices of family firms differ from non-family firms. Results indicate family firms have lower absolute discretionary accruals, report fewer small positive earnings surprises compared to non-family firms, have more informative earnings and have less earnings restatements relative to non-family firms. Overall, the findings indicate that the financial reporting practices of family firms are of better quality than those of non-family firms. Better quality financial reporting practices in family firms is consistent with a long-run investment horizon, reputation concerns and better monitoring of managers, and is indicative of less opportunistic rent extraction.
The primary objective of this study is to test a theoretical framework relating four major corporate governance attributes with the extent of voluntary disclosure provided by listed firms in Hong Kong. These corporate governance attributes are the proportion of independent directors to total number of directors on the board, the existence of a voluntary audit committee, the existence of dominant personalities (CEO/Chairman duality), and the percentage of family members on the board. Using a weighted relative disclosure index for measuring voluntary disclosure, the results indicate that the existence of an audit committee is significantly and positively related to the extent of voluntary disclosure, while the percentage of family members on the board is negatively related to the extent of voluntary disclosure. The study provides empirical evidence to policy makers and regulators in East Asia for implementing the two new board governance requirements on audit committee and family control.
Purpose
The purpose of the paper is to explore the use of “old” and “new” performance measurement (PM) techniques in a joint venture (JV) set up by two partners, a global hotel chain and a Portuguese company.
Design/methodology/approach
The empirical data upon which this paper is based was collected through a prolonged contact with the specific organizational context. Qualitative or semi‐structured interviewing is the main source of information.
Findings
The paper finds that budgeting and budgetary control practices have been the cornerstone of the PM activity at the JV, where few “new” management accounting techniques are used. Yet, changes were made to the way the “old” PM techniques are drawn on and they have been supplemented with rolling forecasts prepared at the hotel level. The objectives are to encourage local managers to become more forward‐looking and to broaden the knowledge of the global partner about the future operating activities of the JV. Simultaneously, local adaptations of PM practices introduced by this partner are occurring.
Research limitations/implications
The lack of interviews with people from headquarters and area management of the global hotel chain has to be seen as a limitation of the present study. To minimize the risk of bias, a triangulation of data was pursued by interviewing multiple people at the JV and at the Portuguese partner, and by discussing preliminary findings on several occasions.
Originality/value
The present study provides insights on how PM practices have evolved over time in a globalized organization, enriching our understanding of those practices in the context of hotel management.
This paper explores financial management techniques of family businesses. We surveyed family businesses to understand the extent to which they use capital budgeting techniques, risk adjustment techniques, and working capital management techniques. We found that more established, larger family businesses that have either an outside board of directors or a nonfamily member in the financial decision-making role are more likely than their smaller counterparts to employ sophisticated financial management techniques.
Drawing on data based on the entire population of Spanish newspapers over 27 years (1966-93), this study shows that firm performance and business risk are much stronger predictors of chief executive tenure when a firm's owners and its executive have family ties and that the organizational consequences of CEO dismissal are more favorable when the replaced CEO is a member of the family owning the firm. The study also demonstrates that executives operating under weakly relational (less ambiguous) contracts are held more accountable for firm performance and business risk outcomes, even under nonfamily contracting.
Historically, as a former British colony, Malta has had its accounting and auditing practices highly influenced by UK regulation. However, in the last decade, departures have steadily been occurring from a UK-based regulatory framework to one increasingly influenced both by international standards and European Union requirements. One such departure relates to the retention of the statutory audit requirement for all Maltese companies, despite its earlier abolishment for small companies in the UK. This study evaluates the relevance of a mandatory annual statutory audit requirement for owner-managed companies as perceived by two interest groups: the owner-manager and the auditor. It also considers possible alternatives to such a requirement. Results indicate that for Maltese owner-managed companies, the statutory audit fulfils two important roles: it bears relevance to outside third parties, and it has a positive effect on the owner-manager and staff.
This article consists of two parts. The first part reports findings from a survey of the issues facing top executives in 272 Canadian family firms. Results show that succession is their No. 1 concern, thus supporting the predominant focus of family business researchers on succession issues. Results also show that concern about relationships with nonfamily managers is a close second in importance. The second part of the article uses Agency Theory to explain why relationships with nonfamily managers are so important. Empirical results show that both the extent and the criticality of a firm's dependence on nonfamily managers are statistically significant determinants of the importance. This study implies that relationships with nonfamily managers is a neglected research topic and points to a new direction for research in family business management.
It has been proposed that we are entering a “4th era” for the application and management of IS/IT within organisations. Where previously the focus has been on the search for strategic information systems (SIS), the concern of IS/IT within organisations is now the development and deployment of “IS capability”. This conceptual approach follows the development of the resource-based theory of the firm and competence/capabilities based perspectives on strategic management. The “4th era” perspective presents the information systems planner with a difficulty. If firms are perceived as collections of organisational capabilities through which they deliver their goods and services, then the conventional information systems planning toolkit does not support this conceptualisation. An information systems planning toolkit built upon concepts of organisational capability and the deployment of IS/IT within them is required. This paper begins to address this gap by proposing a set of such tools. These tools are derived from two exploratory case studies and applied in an exemplar third case study. Possibilities for future research in the areas of organisational learning, management cognitions and strategic information systems planning exercises are discussed.
This paper uses a survey to identify the extent to which Australian manufacturing firms have adopted certain traditional and recently-developed management accounting practices, the benefits received from those practices and the intentions to emphasise certain management accounting practices in the future. The findings indicate that, overall, the rates of adoption of traditional management accounting practices were higher than recently-developed techniques. However, newer techniques, such as activity-based costing, were more widely adopted than found in prior surveys. Also, the benefits obtained from traditional management accounting techniques were higher than those of newer techniques. The evidence suggests that the majority of large Australian firms have adopted a range of management accounting techniques that emphasise non-financial information, and take a more strategic focus.
Agency theory argues that firm performance will be greater when firm ownership and firm control are closely linked. This study examines that premise by comparing the performance of firms that are family-owned and family-managed with a group that is professionally managed. Previous research on the relation between firm governance and performance has focused primarily on the largest firms, ignoring the more prevalent organizational form -- the family owned and operated firms. A survey was administered to a sample of smaller manufacturing firms in Indiana. The 186 responding firms were then categorized as family owned and managed or professionally managed (however owned). The survey examined hypotheses related to firm size, firm age and growth strategies of the family firms vs. the professionally managed firms. Also examined were firm performance and the use of internal control procedures. Differences in structure, process and strategy were found between the two groups. There is some evidence of better performance for the family firm. Each firm of governance has associated costs; these costs need further examination.
The research regarding the characteristics of family firm governance are mixed, with some studies suggesting the presence of benefits of concentrated ownership and others suggesting increased conflict among family employees.To better understand the functioning of family businesses, both the positive and negative aspects of family firm governance must be explored. Initially, the background information on the characteristics of public firms is discussed, as is the agency of private owner-managed firms.The agency issues of these firms are then compared and contrasted to the agency issues at controlling-owner family firms.Both the negative aspects and the positive aspects of parental altruism are discussed.The impact of the stage of ownership is also examined, including the effects of sibling ownership and cousin consortium. Based on this information, several propositions are presented.The main thesis focuses upon the distinctive governing characteristics of family firms--i.e., family firms are a combination of the characteristics of private ownership, owner-management, and altruism. The implications of the propositions are discussed, limitations, and areas for future research are presented. (AKP)
Purpose
To examine differences between family and non‐family SMEs in business goals, management practices and performance as they grow.
Design/methodology/approach
The study was based on 233 small non‐family and 362 small family firms. Medium firms comprised 305 family and 341 non‐family firms. Chi‐square tests and t ‐tests were used to investigate the hypotheses formulated.
Findings
Small family firms were less likely to pursue growth compared with similar non‐family firms. Although medium family proprietors desired growth, their actual growth was lower than similar non‐family firms. Management practices were less formal in family firms and the gap between family and non‐family firms in this area widened with growth. Small family firms achieved greater profits than their non‐family counterparts, although this disparity disappeared at the medium level. Exports were low for both firms at the small level. However, medium family firms were less likely than similar non‐family firms to export.
Research limitations/implications
Firms in the various size groups examined were independent of one another. A longitudinal investigation of family and non‐family firms as they progress through various growth stages should complement the findings.
Practical implications
The findings should assist policies makers, advisers, owners and management in designing policies and programs, providing advice and managing the two ownership types. Informal management procedures and the associated flexibility may enhance performance of small family firms but may impede their performance at larger sizes.
Originality/value
The paper demonstrates that the relationship between goals, strategies and performance varies between family and non‐family firms and the variations change with firm size.
The authors present empirical evidence of how family ownership and control affect the demand for audit quality measured by audit firm size in a sample of small private firms. The results indicate that family-held or family-controlled firms are less likely to use Big 4 auditors than non-family firms and that an increase in family ownership decreases the likelihood of a Big 4 audit. The results imply that the less concentrated family ownership is, the more need there is for outside control mechanisms because of higher agency costs. The results imply that family influence increases firms’ incentives to employ Big 4 audit firms, thereby increasing the credibility of their financial statements vis-à-vis outside stakeholders.
This article analyzes the impact of not controlling for "demographic sample" differences on research results in the area of comparative family/nonfamily business research. Using different statistical methods with and without control for "demographic sample" differences, the results show that controlling for these firm demographics in a bivariate as well as a multivariate framework is very important to discover "real" differences between family and nonfamily firms. We found "real" differences for export, budgeting, variable reward systems, profitability and gender, educational degree, and tenure of the CEO. Strategy, networking, long-term planning and control systems, perceived environmental uncertainty, growth, and management training, classified by prior empirical research as different between family and nonfamily firms, do not differ.
Fast-growth family firms were surveyed about their business and strategic planning practices. Of the 65 fast-growth family firms surveyed, the majority prepare written formal plans. The business plans are in sufficient detail to enable the business to tie planning to actual performance and to adjust management compensation accordingly. The majority of the firms regularly share information with employees regarding comparisons between actual company performance results and goals or planned performance. Further, the majority of the firms describe their business strategy as a high quality producer strategy rather than as a low-cost or time-based strategy. Further, when bringing new products to market, these fast-growth family firms adopt a first mover or early follower strategy. Implications of these findings for growth-oriented family firms are presented.
Advanced management accounting techniques were developed to provide information appropriate for decision making in changing internal and external environments. However, studies in the US and UK demonstrated that firms are slow to adopt such techniques. To examine whether and why this reluctance exists, manufacturers’ adoption and utilization of advanced accounting techniques, plus perceived barriers to adoption, were examined. Data were collected from 165 New Zealand manufacturing sites, selected as representative of organizations facing major structural reform and environmental change, hence likely candidates for accounting system rejuvenation. Adoption, utilization, combinations of techniques, trends, perceived benefits, and barriers to adoption are discussed.
Do businesses tend to be born as family firms or do they become family firms at a later stage in their development? The question has important implications for family business studies. In this article we examine this question using data extracted from survey responses of small business clients of the Small Business Development Center (SBDC) program in the United States. The results suggest that most family firms are born that way but that a significant number of firms do arrive there through time. The relationship between age and family involvement appears to be concave—the rate of increase in family involvement slows as family firms become older and at some point family involvement may even decline.
This article describes an explanatory study of the impact of financial reporting practices upon business growth and performance outcomes amongst small and medium-sized enterprises (SMEs) engaged in manufacturing in Australia. The study is able to establish some statistically significant bivariate associations between the extent and frequency of financial reporting undertaken and certain measures of SME growth and performance. However, the state of financial reporting practices becomes subsumed by other important influences in multivariate analysis. Management is a complex activity affected by a myriad of interacting internal and external factors, and must inevitably be undertaken in an holistic manner in SMEs. Particular practices make a contribution to the whole task without necessarily standing out as all-embracing solutions to problems generally encountered. Thus, it is argued that improved financial reporting should be realistically viewed as simply part of a broader competence in financial management which, taken together with other functional capabilities, is likely to lead to more effective and efficient management of SMEs and significantly improve their prospects.
Organizational culture is an important strategic resource that family firms can use to gain a competitive advantage. Drawing upon the resource-based view (RBV) of the firm, this study examines the association between four dimensions of organizational culture in family vs. non-family businesses and entrepreneurship. Using data from 536 U.S. manufacturing companies, the results show a nonlinear association between the cultural dimension of individualism and entrepreneurship. Further, there are positive linear relationships between entrepreneurship and an external orientation, an organizational cultural orientation toward decentralization, and a long- versus short-term orientation. With the exception of an external orientation, each of these dimensions is significantly more influential upon entrepreneurship in family firms when compared with non-family firms.
This paper presents a framework for organizational analysis. The empirically derived approach does not emerge from the observation of actual organizations, but from the ordering, through multivariate techniques, of criteria that organizational theorists and researchers use to evaluate the performance of organizations.
In a two-stage study, organizational theorists and researchers were impaneled to make judgments about the similarity of commonly used effectiveness criteria. The model derived from the second group closely replicated the first, and in convergence suggested that three value dimensions (control-flexibility, internal-external, and means-ends) underlie conceptualizations of organizational effectiveness.
When these value dimensions are juxtaposed, a spatial model emerges. The model serves a number of important functions. It organizes the organizational effectiveness literature, indicates which concepts are most central to the construct of organizational effectiveness, makes clear the values in which the concepts are embedded, demonstrates that the effectiveness literature and the general literature on organizational analysis are analogues of one another, and provides an overarching framework to guide subsequent efforts at organizational assessment.
Theoretical and empirical research regarding the impact of corporate ownership on the behaviour and performance of firms have typically focused on consequences stemming from the separation of ownership and control. While large scale business enterprise characterized by such a separation is dominant in the US, Japan and the UK, firms in which ownership and control is coupled in the hands of individuals and their families are apparent in many other large developed economies and are dominant in most emerging markets. This paper examines consequences regarding the generation and allocation of financial resources stemming from the coupling of ownership and control among Hong Kong based firms. In doing so, we join insights from the economics literature regarding the incentive and risk bearing consequences of coupled ownership and control with the extant management, sociology and history literatures regarding Chinese family business groups and develop and six hypotheses pertaining to patterns in the allocation of financial resources. Results indicate that coupled ownership and control is positively related with dividend payout levels and financial liquidity while it is negatively related to investments in capital expenditures. Consistent with these results, we also find that coupled ownership and control is positively related to short-term (accounting) profitability.
textlessptextgreaterThis paper examines the effect of structural decentralization, perceived environmental uncertainty, and organizational interdependence on Management Accounting Systems [MAS] design. MAS design was defined in terms of the perceived usefulness of several information characteristics which may be associated with an MAS. These characteristics were scope, timeliness, level of aggregation, and information which assists integration. In addition to examining the direct effects of contextual variables, the study sought to determine how the independent variables interacted. Hypotheses were generated for both direct and indirect effects of contextual variables and were tested using data collected from 68 managers. The findings indicated that: 1) Decentralization was associated with a preference for aggregated and integrated information; perceived environmental uncertainty with broad scope and timely information; organizational interdependence with broad scope, aggregated, and integrated information. 2) The effects of perceived environmental uncertainty and organizational interdependence were, in part, indirect through their association with decentralization.textless/ptextgreater
Managers in the hotel industry, compared to their counterpart in manufacturing industries, face more uncertain and complex work environment because of the hotel industry's unique service characteristics. Hotel industry managers’ budgetary participation and their use of information technology for communication may assist them in facing the uncertain and complex work environment and perform their jobs better.This paper reports the results of a study, which investigated the role of hotel managers’ use of information technology for communication (ITC) in the relationship between the managers’ perceived performance and their budgetary participation. To assess the relationship, data were collected from 74 department managers using a mailed questionnaire. The results indicate that the department managers’ perceived performance in the hotels was positively associated with the interaction of their use of the ITC and budgetary participation. Implications of the results are discussed in the paper.
This study adopts a configurational approach that captures possible variables (strategy, structure, leadership and decision-making styles) and their relationships with management accounting systems (MAS) from an organizational life-cycle perspective. Using Miller and Friesen's life-cycle model and , a set of hypotheses were tested with data from mail survey and field studies of firms in the clothing and footwear industry. Results indicated that MAS formality changed to complement organizational characteristics across life-cycle stages. In uncovering how and why MAS formality changed during organizational development, our results indicate that it is growth firms that pay particular attention to increasing the formality of their MAS. Furthermore, between stages, it is the selection of management accounting tools that dominates the presentation of information in explaining the different MAS life-cycle stage designs. While based on cross-sectional data, the homogeneity of organizational configurations at each life-cycle stage does suggest that these results imply a longitudinal development of MAS.
Simons' `levers of control' framework indicates that an interactive use of management control systems (MCS) contributes to fostering successful product innovation. However, his work is ambiguous in not specifying whether the relationship between interactive controls and innovation is a mediating or a moderating relationship. This paper examines the relationships among variables embedded in Simons' framework of levers of control, explicitly distinguishing the different types of effects involved and testing their significance. The results of the survey-based research do not support the postulate that an interactive use of MCS favours innovation. They suggest this may be the case only in low-innovating firms, while the effect is in the opposite direction in high-innovating firms. No evidence is found either in favour of an indirect effect of the interactive use of MCS on performance acting through innovation. In contrast, the proposition that the impact of innovation on performance is moderated by the style of use of MCS is supported, with results indicating that the explanatory power of a model that regresses performance on innovation is significantly enhanced by the inclusion of this moderating effect.
The purpose of this study is to investigate whether firms’ auditor choice relates to national culture. We construct a novel measure of secretiveness based on Hofstede [Hofstede, G., 1980. Culture’s Consequences: International Differences in Work Related Values. Sage Publications, Beverly Hills, CA] cultural factors. Using a very large sample of firms from 37 countries and controlling for a number of firm- and country-level factors, we find that firms in “more secretive” countries are less likely to hire a Big 4 auditor. We also document that the relation between secrecy dimension of national culture and auditor choice is mitigated by the firms’ degree of internationalization. These results establish a link between national culture and financial reporting quality through the firm’s choice of auditor.
Contingency-based research has a long tradition in the study of management control systems (MCS). Researchers have attempted to explain the effectiveness of MCS by examining designs that best suit the nature of the environment, technology, size, structure, strategy and national culture. In recent years, contingency-based research has maintained its popularity with studies including these variables but redefining them in contemporary terms. This paper provides a critical review of findings from contingency-based studies over the past 20 years, deriving a series of propositions relating MCS to organizational context. The paper examines issues related to the purpose of MCS, the elements of MCS, the meaning and measurement of contextual variables, and issues concerning theory development. A final section considers the possibility that contingency-based ideas could encompass insights from a variety of theories to help understand MCS within its organizational context.
In this study we investigate use of management accounting systems by general managers and department managers in luxury hotels. We also investigate general managers’ emphasis on financial and non-financial performance indicators while they evaluate their department managers’ performance. In addition, managers’ satisfaction with details and availability of their hotel's management accounting system (MAS) is assessed. The results indicate that general managers and department managers make equal use of MAS for both short and long-term decisions. However, a detail analysis of the data by manager groups indicates that general managers differ from department managers with respect to their use of MAS for making decisions. Furthermore, general managers, compared to department managers, are found to be more satisfied with the frequency in which MAS is available to them. On the issue of department managers’ performance evaluations by general managers, the results reveal that general managers put more emphasis on financial than on non-financial performance indicators. The department managers in the study were in charge of food and beverage and room departments. The sample is rather small; only 35 managers from one region in Australia participated in the study. Therefore, any generalisation of the results requires caution.
Despite the numerical and economic significance of family businesses to Australia, they are not extensively researched. This paper reports some of the results from a nationwide study of Australian family-owned businesses that sought to ascertain and understand their management and control practices. In particular, the paper assesses the organizational transitions of Australian family firms in terms of their dominant control practices. These control measures are evaluated according to Ouchi’s classification of market, bureaucratic, and clan controls. The salience of these different forms of control serves to identify distinctive patterns that define periods of organizational passage (life cycles).
Given the debate in both the professional and scholarly literature on the effectiveness of management accounting systems in the contemporary business environment, there is a need to understand more about the impact of activity-based costing (ABC). In this paper, we show that the choice of a management accounting system, such as ABC, may have a significant impact on firm value. Specifically, for a sample of U.K. firms, we show that firms adopting activity-based costing techniques outperform matched non-ABC firms by approximately 27 percent over the three years beginning on January 1 of the year in which the ABC techniques are first implemented. This result is robust to different matching criteria and for both accounting and market-based measures of performance. Further analysis suggests that ABC adds to firm value through better cost controls and asset utilization, coupled with greater use of financial leverage.
El objeto de este trabajo es verificar, en el contexto de las ayudas financieras a la innovación a la Pyme, la existencia de un posible sesgo de motivación y de selección administrativa. Para ello se realiza un estudio empírico con una muestra de 532 Pymes de la Región de Murcia. En cuanto al sesgo de motivación, los resultados ponen de manifiesto que las empresas que solicitan a la Administración una ayuda financiera se caracterizan por ser las empresas de mayor tamaño, con una estrategia más orientada a la innovación y pertenecer al sector industrial. En cuanto al sesgo de selección administrativa, los resultados muestran que la probabilidad de que una empresa obtenga una ayuda financiera aumenta si la empresa posee una buena posición tecnológica y si pertenece al sector industrial. Los resultados obtenidos en este estudio empírico sugieren una serie de recomendaciones a los gestores públicos con el objetivo de mejorar el diseño de las políticas de ayudas a las Pyme