Exploring 40 Years of Research on Management
Accountants’ Roles: What do we know and what do
we need to know?
Name: Pieter Post Student number: S2378124
Track: Msc. Accountancy & Msc. Controlling Supervisor: W. G. de Munnik
Date: 21-01-2019 Word count: 11721
Abstract
This study explores the evolution of the management accountants as the profession was, and arguably still is, undergoing some major changes. Therefore, the roles that management accountants take on developed as well, which yielded 40 years of literature on this topic. A semi-structured literature review is conducted in order to obtain a comprehensive overview of
the diversity of evidence on management accountant’s roles and change. Management accountant’s roles are a complex issue because they are subject to influences from many origins. The aim is to capture the complex nature and to categorize previous findings. The
categorization and subsequent analysis are used to create a number of interrelated propositions that can serve as a basis for future research on the topic. The main conclusion was that there is an extensive list of variables involved with the construction of management accountants’ roles; however, the extant literature has not been able to capture this accurately. The dichotomy and stereotyping of the bean-counter and business partner have been used as
the most common approach, despite its shortcomings. The results of this research project suggest a continuum approach that more accurately reflects the versatility of management
accounting. This continuum is then used to provide recommendations on the topic of hybridization, and the debates between a transition and an expansion of roles and being or
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Table of Contents
1. Introduction ... 3 2. Methodology ... 6 2.1 Method... 6 2.2 Selection ... 6 3. Analysis ... 9 3.1 Overview ... 103.1.1 Roles, functions, tasks, and activities ... 10
3.1.2 Role attributes and change drivers... 15
3.2 Categorization ... 19 3.2.1 Theories. ... 19 3.2.2 Contextual dimensions. ... 22 3.2.3 Individual variables. ... 27 4. Discussion ... 33 4.1 Continuum ... 33 4.2 Dimensions ... 35 4.2.1 Professional/Occupational dimension ... 35 4.2.2 Organizational dimension ... 36 4.2.3 Individual Dimension ... 37 4.3 Hybridization ... 39 5. Concluding Remarks ... 42 6. References ... 44
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1. Introduction
On January 26th, 2017, Wim Nusselder wrote an article in which he referred to management accountants and auditors as being part of the whistle-blowers guild (Accountant.nl). He describes their job as being responsible for finding and reporting (potential) errors. This image represents a wrongful oversimplification of the present-day role of the management accountant (MA). The actual occupation of the MA comprises activities far more diverse and interesting than merely finding and reporting errors. Even though the article references a somewhat outdated version of the MA, it is nevertheless relevant for two reasons. First, because it underlines the ambiguity regarding the MA profession and second because it is an example of how there has been increasing media coverage regarding management accounting. The aforementioned traditional version of the MA is most commonly known as the bean-counter. It is defined by Granlund and Lukka (1997) as “the type of persons who aim to write accurate and correct financial history and thereby attempt to respond to the formal
information needs, whose personal communication is typically directed into the accounting function only and whose communication to the outside of the accounting function
concentrates on written reports.” Historically speaking this was the typical version of the MA; however, the profession has been subject to some major developments over the past decades. Management accounting change has been said to be caused by changing demands in the external competitive environment of organizations (Baines and Langfield-Smith; 2003), a change in rules and routines in organizations (Burns and Scapens; 2000) and the increasing level of globalization and technological development (Burns and Vaivio; 2001). These changes have resulted in the emergence of new management accounting techniques and systems. In turn, this has also led to the reconstruction of the management accounting
function, which scholars have now separated in a multitude of different MA roles (Goretzki et al., 2013; Baldvinsdottir et al., 2009; Byrne and Pierce, 2007). Defining these MA roles is not merely a matter of black and white; there are many factors influential in the construction of MAs. As a result, there has been a need for new theories regarding management accounting. Normative theories that have resulted in advancing management accounting theory include role theory (Kahn, 1964), contingency theory (Otley, 1980) and institutional theory (Goretzki et al., 2013). Malmi and Granlund (2009) deduced that even though these theories have been applied to management accounting, there still is a need for scholars to contribute to theory shaping management accounting specifically. Otley (1980) denoted that contingency theory
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might offer an interesting and fruitful platform for the development of management
accounting theories. Chenhall (2003) advanced this by stating that individual attributes may be relevant in determining the compatibility between individual and organizational factors. If compatibility between individual and organizational factors is an issue, this could also suggest that individual roles of MAs may be contingent on circumstances. As stated above the
development of management accounting functions and management accounting, in general, have been subject to change recently, which may also have implications on individual roles of MAs. According to Byrne and Pierce (2007), research on the contemporary roles of MAs is still fragmented and incomplete. The evolution of the traditional bean-counter role towards a new ‘business partner’ role has generally been acknowledged in management accounting literature (Baldvinsdottir et al., 2009; Granlund and Lukka., 1997; Järvenpää., 2007). There are potentially multiple perspectives that could be valid approaches for explaining role change; however, one trend seems to be prevalent. Several articles concur in sticking to a ‘macro perspective’, for example, institutional theory (Goretzki, 2013), culture (Granlund and Lukka, 1998) or contingency theory (Chenhall, 2003). These articles all approach the role change on a country, organization or profession level, whilst paying minimal attention to how individual MAs can be the cause of role change. Relatedly there is the concept of identity, which more recently has been associated with MA roles. According to Ibarra and Barbulescu (2010), identity may give various distinct meanings to an individual, suggesting that identity may be context-dependent. Goretzki et al. (2013) referred to the interaction between role and identity as one’s role looking outward, where one’s identity looks inward. In sum, MA literature contains a multitude of factors, concepts, and perspectives that partake in the construction of MA roles. There is, however, yet to be one approach that fully captures the multidimensional nature of management accounting, and thereby serving as the foundation for assessing MA roles. This indicates the absence of an adequate overview of the multiplicity of MA role literature. Thus, the literature, divergent and fragmented at times, provides the potential richness and relevance for conducting exploratory research on the construction of MA roles.
What do we know about the construction of management accountants’ roles and what do we need to know?
As the management accounting profession gains momentum for its divergent roles, this may also be the reason that it has become increasingly subject to change. Sathe (1983) was
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amongst the first to distinguish multiple different roles that may be suited for
controllers/MAs. His article categorizes controllers on their utility for management, hereby mentioning the ‘independent controller’ who partakes more in assisting management than in financial reporting and the ‘involved controller’ who partakes more in financial reporting than assisting management. These roles are resembled by the stereotypical bean-counter and business partner (Järvenpää, 2007). Bean-counters have been portrayed in a negative manner, which resulted in an inseparable, negative image (Friedman and Lyne, 2001). On the other hand, the business partner is referenced in several ways, although not yet clearly defined (Quinn, 2014). This suggests that the business partner is either somewhat idealistic or continuously reinvented based on new demands. Additionally, the literature describes multiple more or less the same roles by different names with matching characteristics and ascribed activities. Byrne and Pierce (2007) researched antecedents, characteristics, and consequences associated with roles of MAs and provided considerable insight on defining these roles. Their study, however, mostly focuses on how roles define MAs. Goretzki et al. (2013) rely on an institutional perspective that analyses how a new MA role becomes
embedded in an organization. Their study mainly contributes on how the MA’s individual role can change in an otherwise stable environment, after introducing a new actor. They do
however underline the significance of identity reconstruction that goes hand in hand with the role change. MAs taking on a new role may want to align this role with their personal identity. Individual attributes that are entrenched in MA identity can thus be impactful in predicting the role that suits them most. Granlund and Lukka (1997) further extended the existing research by analysing management accounting culture in Finland and comparing the results with characteristics of Finnish culture. This advanced our understanding of MA roles on the country level and gave insight on the impact of some internal, personal characteristics. Their results are however not directly generalizable to other countries and cultures. Despite research on MA role change being around for over 40 years, inconsistencies and inconclusive results are what remains. The diversity of roles and the concept of role change are universally acknowledged. Taking the variables and their respective context together should be the next step to help guide future research. In order to accomplish this, extant literature should be analysed and categorized to represent a summary of what is written to date. Thus, a literature review, with the intent to summarize previous literature and to support future literature is necessary. The remainder of this paper is structured as follows; the next chapter will contain the methodology, describing the method and selection of papers, followed by the analysis and
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categorization in chapter three, thereafter chapter four will include the discussion and composition of propositions, and finally chapter five with the conclusions and implications.
2. Methodology
2.1 Method
As discussed in the previous chapter, 40 years of research regarding MA roles and
management accounting change have not yielded conclusive results to this date. Academics have presented results that are at times conflicting and inconsistent, suggesting the need for categorization. The diversity of literature on MAs and its broad range of perspectives served as the motivation to explore this topic further. I started tentatively orienting the extant literature by entering a number of terms into Google Scholar. The search terms included ‘Management Accountant’, ‘Role’, ‘Change’ and ‘Controller’. I found ‘Identity’ to be a recurring theme in the results; therefore, I decided to add it to the query. The multitude of articles that surfaced confirmed my presumption that MA roles was a versatile topic and therefore appropriate for a literature review.
Conducting a literature review provides the opportunity to capture the diversity of MAs and their roles in organizations by using the different perspectives, settings, and methods in a complementary manner. This review will follow an inductive approach, hence the absence of hypotheses. In the remainder of this paper, I will strive to categorize the multitude of factors and characteristics of MA role (change) and provide a comprehensive overview of the findings. In the process of analysing and summarizing, I will attempt to uncover recurring trends and possibly identify salient contradicting and conflicting findings. This approach most resembles a ‘research synthesis and meta-analysis’ (Massaro and Guthrie, 2016). The aim is to explore existing literature on MA roles and the construction thereof. Comprehensively, the findings should serve as a guide for future research (Petticrew and Roberts, 2008).
2.2 Selection
According to Massaro and Guthrie (2016), a literature review can range from a ‘rapid review (no rules)’ to a ‘structured literature review (rigid rules)’. This paper can be placed
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somewhere in the middle of the continuum. Rules are stricter than that of a ‘narrative review’, however, no statistical analysis will be performed, neither is the size of the scope of the research large enough to be quantitative. The main database used for this review is Google Scholar, which offers scientific papers from multiple other databases. The results are limited to journals that are accessible through the University of Groningen. The RUG provides an overview of the qualification of journals for different disciplines. To ensure the quality of the sample of articles I chose a minimum threshold of articles to be from top or very good
journals (e.g. AAAJ, AOS, and MAR). The established topics of the review are ‘MA’, ‘Role’, ‘Change’ and ‘Identity’, thus these were the central keywords in generating articles, as well as ‘Controller’ which is used interchangeably with ‘MA’. The next step was to identify
complementary search terms to ensure the diversity of the results. These formed gradually throughout the search process, characteristics and antecedents (Byrne and Pierce, 2007) culture (Granlund and Lukka, 1997), bean-counter (Friedman and Lyne, 1997), business partner (Järvenpää, 2007) and construction (Goretzki et al., 2013). Adding these terms also helped to diminish the effect of the homonyms for the words role and controller, and the broad nature of the word management. To ensure the relevance of the papers that came up I did not continue searching after the tenth page and when the first five pages did not yield any results, I chose to stop there. Another essential step before the selection of literature was determining an appropriate starting point. Hopper (1980) was among the first to part from the notion that MAs themselves seek to avoid a role more associated with the assistance of
management. His findings contradicted the assertion that all MAs conform to the stereotypical bean-counter role. This suggests that differences between MAs and between organizations may result in different roles for MAs. The above offers an excellent base for my research, hence why I chose Hopper’s article as my starting point.
My approach to selecting which papers were suitable for further use contained a number of steps. First, I decided only to include scientific papers and to exclude columns etcetera. Then I judged the title, some titles clearly signified their irrelevance (e.g. containing homonyms). I continued by reading the abstracts to check whether the keywords were actually keywords in these papers as well. Next, I skimmed through the introductions and conclusions, which allowed me to determine whether the articles contained enough basis for comparison. I refrained from using methods like truncation or the use of ‘wild cards’ as I suspected this would lead to more deviation from the central theme than desired. Another common method that is used to find additional literature is the snowball method, which uses the bibliography
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of other selected articles. I checked the references of the articles that were relatively recent to check whether there were renowned articles missing from my sample. This resulted in the definitive sample of 38 articles, of which Table 1 provides a detailed overview. The sample contains articles written by 60 different authors, published in 21 different journals, where 25 of the articles are published in a top or very good journal.
Table 1: Literature sample overview
Year Author Title Type Journal Theory Setting 1980 Hopper Role conflicts of management
accountants and their position within organization structures
Interviews AOS Role theory, UK
1980 Otley The contingency theory of management accounting: Achievement and prognosis
Literature
Review AOS contingency theory N.A.
1983 Sathe The Controller’s Role in
Management Interviews OD Undefined
1989 Newman, Smart
& Vattinsky Occupational role dimensions: The profession of management accounting
Survey BAR British Columbia,
Canada
1997 Granlund &
Lukka From Bean-Counters to Change Agents: The Finnish Management Accounting Culture in Transition
Empirical, interview, field study
LTA Finland
1997 Friedman &
Lyne Activity-based techniques and the death of the beancounter Interviews EAR UK
1998 Granlund &
Lukka Towards increasing business orientation: Finnish management accountants in a changing cultural context Empirical, ongoing field research, semi-structured interviews MAR Finland 1998 Granlund &
Lukka It’s a Small World of Management Accounting Practices Analytical JMAR isomorphism Finland
1999 Llewellyn Narratives in accounting and
management research Literature Review AAA Narratives N.A.
2000 Ahrens &
Chapman Occupational identity of management accountants in Britain and Germany Interviews EAR UK/Germany
2001 Friedman &
Lyne The beancounter stereotype: towards a general model of stereotype generation
Public media
analysis CPA realistic conflict theory global
2003 Scheytt, Soin &
Metz Exploring notions of control across cultures: a narrative approach Narrative approach, experiment?
EAR structuration
theory Austria, France, Germany, UK
2005 Burns &
Baldvinsdottir An institutional perspective of accountants' new roles – the interplay of contradictions and praxis
Longitudinal
Case Study EAR institutional theory UK
2007 Byrne & Pierce Towards a More Comprehensive Understanding of the Roles of Management Accountants
Qualitative
(Interviews) EAR management control theory, institutional, role theory
Ireland
2007 Järvenpää Making Business Partners: A Case Study on how Management Accounting Culture was changed
Longitudinal
Case Study EAR Global
2007 Verstegen, de
Loo, Mol, Slagter & Geerkens
Classifying Controllers by Activities:
An Exploratory Study Survey JAMAR Netherlands
2008 Yazdifar,
Askarany & Askary
Management Accountants’ Role in Dependent and Independent Companies: Does Ownership Matter?
Survey JABM UK
2009 Baldvinsdottir,
Burns, Norreklit & Scapens
The image of accountants: from bean
counters to extreme accountants Linguistic Analysis AAA sociological theory Global
2009 Maas &
Matejka Balancing the Dual Responsibilities of Business Unit Controllers: Field and Survey Evidence
Survey TAR role conflict, role ambiguity, role theory
9 2010 Lambert &
Pezet The making of the management accountant – Becoming the producer of truthful knowledge
Case Study AOS France
2010 Hartmann &
Maas Why Business Unit Controllers Create Budget Slack: Involvement in Management, Social Pressure, and Machiavellianism
Experiment,
2x2 factorial BRA Netherlands
2011 Hartmann &
Maas The effects of uncertainty on the roles of controllers and budgets: an exploratory study
Survey ABR contingency theory Netherlands
2011 Weber The development of controller tasks: explaining the nature of
controllership and its changes
Framework
development JMC organization theory N.A.
2011 De Loo,
Verstegen, Swagerman
Understanding the roles of
management accountants Survey EBR Netherlands
2011 Abrahamsson,
Englund & Gerdin
Organizational identity and
management accounting change Case Study AAA Sweden
2012 Lambert &
Sponem Roles, Authority and Involvement of the Management Accounting Function: A Multiple Case-study Perspective
Multiple Case
Study EAR France, UK, Sweden,
Netherlands, Switzerland
2012 Paulsson The Role of Management Accountants in New Public Management Empirical: Survey, Interviews, and Seminar FAM NPM Sweden 2013 Goretzki, Strauss & Weber
An institutional perspective on the changes in management accountants’ professional role
Case Study MAR institutional theory Germany
2013 Windeck,
Weber & Strauss
Enrolling managers to accept the business partner: the role of boundary objects
Case Study JMG actor network
theory Germany
2013 Lambert &
Morales Dirty work and the construction of identity. An ethnographic study of management accounting practices
Case Study AOS Dirty work France
2013 Heinzelmann Occupational identities of management accountants: Situated identity regulation and work
Case Study +
Interviews PPC Austria, UK, France
2014 Kim-Keung Ho An Exploratory Exercise to Establish the Profile of a Double-hybrid Management Accountant with Justifications
Review EARs N.A.
2014 Hiller,
Mahlendorf & Weber
Management Accountants’ Occupational Prestige Within the Company: A Social Identity Theory Perspective
Survey EAR social identity theory, self-categorization Global 2015 Hyvönen, Järvinen & Pellinen
Dynamics of Creating a New Role for
Business Controllers Interviews, interpretive NJB institutional entrepreneurshipan d collective agency NYSE listed company 2018 Horton & Araujo-Wanderley
Identity conflict and the paradox of embedded agency in the management accounting profession: Adding a new piece to the theoretical jigsaw
Literature
Review MAR social identity theory, N.A.
2016 Taylor &
Scapens The role of identity and image in shaping management accounting change
Longitudinal
case study AAA social identity theory UK
2018 Rieg Tasks, interaction and role perception of management accountants: evidence from Germany
Empirical JMC role, contingency,
social identity Germany
2018 Caicedo,
Martensson & Hallstrom
The development of
the management accountant's role revisited: An example from the Swedish Social Insurance Agency
Case Study FAM Lean, NPM Sweden
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3.1 Overview
3.1.1 Roles, functions, tasks, and activities
After establishing the definitive sample of literature, the next step was to start the analytical process. As MA roles are the main topic that I wanted to explore, I decided that my analysis should start with assessing which roles the literature discussed over the last 40 years. As stated in the previous paragraph, Hopper (1980) serves as the starting point of my analysis. Working forward from there it was evident that subsequent articles did not adhere to the same roles as found in Hopper (1980). Next was Sathe (1983) who determined four roles, which are either ‘Independent’, ‘Involved’, ‘Split’ or ‘Strong’ Controllers, the most notable factor for separating these roles was the emphasis on one of two functions. The ‘independent controller’ is mainly concerned with the function described as ‘financial reporting and internal control’, whereas the ‘involved controller’ focuses on the function ‘management service’. I proceeded my analysis by checking each article for not only the roles that were referenced but also for the functions thought to be central to MA roles. Table 2 contains an overview of the roles and functions that found, roles mentioned only briefly in the literature review of the respective articles were left out for the sake of relevance.
Table 2: Roles and Functions
Year Author Role Function
1980 Hopper book-keeper, service-aid
1983 Sathe strong controller, split controller, independent
controller(policeman/umpire), involved controller
management service, financial reporting and internal control
1989 Newman, Smart
& Vattinsky middle management accountant, controller score-keeping, attention directing, problem-solving
1997 Friedman &
Lyne beancounter, business-oriented MA record-keeping, control, decision making
1998 Granlund &
Lukka historian, bean counter, watchdog, change agent, adviser/consultant, member of the management team, controller
support decision making, organizational control
2001 Friedman &
Lyne beancounter bookkeeper
2005 Burns &
Baldvinsdottir beancounter, hybrid
2007 Byrne & Pierce beancounter, number cruncher, business partner
2007 Järvenpää scorekeeper, watchdog, bean counter, business partner
2007 Verstegen, de Loo, Mol, Slagter & Geerkens
information adapters, watchmen designing and changing control systems and supporting change processes, internal reporting, external reporting, supervising and maintaining AIS, risk monitoring
2008 Yazdifar, Askarany & Askary
beancounters, business advocates, business analyst, business partner, corporate police, financial analyst, number-cruncher, scorekeeper
11 2009 Maas & Matejka BU controller, business
partner/service-aid,
watchdog/corporate policeman
local and functional
2010 Lambert & Pezet producer of truthful knowledge
2010 Hartmann &
Maas BU controller Corporate control, supporting BU managers decision making
2011 Hartmann &
Maas corporate policeman, business partner controlling, facilitating
2011 Weber beancounter, business partner technical, co-management
2011 De Loo, Verstegen, Swagerman
reporting business analyst, business
system analyst internal analysis, internal reporting, external reporting, risk management, maintaining management control systems
2012 Lambert &
Sponem discrete, safeguarding, partner, omnipotent discrete control of managerial behaviour, socialization of managers, facilitation of decision-making, centralization of power
2012 Paulsson beancounter, business partner, accountant, analyst, educator, coach
2013 Goretzki, Strauss & Weber
beancounter, reporter, navigator, business partner/innovator
2013 Windeck, Weber & Strauss
beancounter, business partner
2013 Lambert &
Morales business oriented management accountant gatekeeper
2013 Heinzelmann finance leaders, real-life
accountants, sparring partners calculating/reporting/controlling, decision-making and interaction with managers
2014 Kim-Keung Ho business oriented management accountant, functionally oriented management accountant, double hybrid management accountant
2018 Rieg beancounter, business partner strategic, operational
2018 Caicedo, Martensson & Hallstrom
beancounter, business partner helpdesk
The results in Table 2 signify the multitude of different roles that MAs take on within organizations and that scholars are not necessarily in accordance. Notions of involvement in management gradually evolve into a transition from the infamous bean-counter towards the idealized business partner (Friedman and Lyne, 1997; Granlund and Lukka, 1998a). The dichotomy of those two roles is evidently a recurring trend in the selected articles (Byrne and Pierce, 2007; Järvenpää, 2007; Weber, 2011; Windeck et al. 2013; Rieg, 2018). The functions ascribed to these roles show some variation, as in addition to the aforementioned functions of Hopper (1980) and Sathe (1983) the three functions of Simons (1954) are frequently
referenced, respectively score-keeping, attention directing and problem-solving. The apparent lack of a hard-set connection between the dichotomous roles of MAs and the functions
triggered the comparison of descriptions given for the roles. Table 3 provides an overview of how different authors described various roles.
Table 3: Role Definitions
12 Hopper (1980) Bookkeeper Bookkeeper: The bookkeeper is concerned with the implementation and
administration of financial systems to enable superiors to specify and measure the performance of subordinates. The accountant is primarily a scorer and a hierarchical attention director. He conceives organizational control and adaptation as being achieved by mechanistic management, which may provide the conceptual basis for many orthodox accounting techniques. Service-aid The service role, by contrast, identifies lower and middle management as the
major clients of accountants and satisfying such managers’ information needs for self-control as the principal task of accountants. Stress is placed on personalized and horizontal communications, education, identification and analysis of problems with peer and subordinate managers and the provision of a broad range of information.
Newman et al.
(1989) Controllers Accountants specifically charged with managing a professional accounting group, but they may also be part of the senior corporate-management team. Middle management
accountants Most important role components for middle-management accountants would be score-keeping and attention-directing activities. Further, it was hypothesized that their role would be narrowed to a traditional accounting focus rather than expanded to include problem-solving activities.
Friedman &
Lyne (1997) Bean counter An accountant who produces financial information which is regarded as of little use in efficiently running the business and, as a result, its production has become an end in itself.’
Granlund &
Lukka (1998a) Bean counters Aim to write accurate and correct financial history and thereby attempt to respond to formal information needs. For these ‘bean-counter’ people, personal communication is typically directed into the accounting function only and their communication to the outside of the accounting function concentrates on written reports.
Business-oriented
MAs/controllers Are required to have in addition to the knowledge of the principles of financial analysis-a good understanding of the business the firm is in, fluent communication skills and an ability to run change projects, too. The orientation of their actions in terms of time is more towards the future than to the past and the role played by the detailed accuracy of the figures they deal with is far from the significance this issue has for the traditional ‘bean-counter’ type of accountants-it is better to be approximately right than precisely wrong’
Friedman &
Lyne (2001) Bean counter Single-mindedly preoccupied with precision and form, methodical and conservative, and a boring joyless character has, until recently, been widely recognized as the clear stereotype of the accountant.
Burns & Baldvinsdottir (2005)
Hybrid An accountant whose multi-faceted role was primarily located within the product stream.
Byrne & Pierce
(2007) Bean counter the accountant that is characterized as being removed from operational processes is frequently depicted as the bean counter role, this dimension to the role may incorporate more statutory reporting and compliance-related tasks rather than management accounting tasks per se.
Business partner The MAs being associated with active involvement in the strategic and operational decision making processes of organizations.
Järvenpää
(2007) Business partner Being the active advisor of management and an increasing participant in decision-making.
Verstegen et al.
(2007) Watchmen Watchmen focus on maintaining accounting information systems and risk monitoring, leaving the reporting bit more aside than Sathe’s independent controller
Information adapters Acquires, analyses and manages information on the basis of organizational needs, focusing on organizational change processes.
Hartmann &
Maas (2011) Corporate policeman Controllers are agents of higher-level managers and organizational stakeholders. Their main responsibilities are to make sure all decisions made at lower levels of the organization are in the interest of the firm as a whole (by stressing operating efficiency and conservation of corporate resources) and to ensure compliance with rules and regulations and technical bookkeeping procedures.
Business advocates BU controllers are primarily focused on providing assistance to BU managers. They help develop and implement BU strategies and actively participate in running their units’ operations
Windeck et al.
(2013) Bean counter or Watchdog Routine financial analysis and reporting.
Business partner A broader responsibility of advising management and participating in decision-making.
13 Heinzelmann
(2013) Financial leaders financial leadership and encompassing the entire field of accountancy in the public, legal, and workplace arenas Real-life accountants The idealized role of real-life accountants ascribed to CIMA certified
accountants is characterized in a way similar to the business partner role. Sparring partners The conscience of companies, and as an internal consultant, an accountant
strongly involved in business processes and part of the management team.
Kim Keung Ho
(2014) Business-oriented MA/hybrid accountant
Business unit-oriented management accountants are essentially hybrid management accountants; they must have sufficient management education in other accounting disciplines and working experience in other non-accounting work domains to be competent business unit-oriented management accountants. Thus, the profile of business unit-oriented management accountants is the same as that of hybrid management accountants referred to in management accountant works
Rieg (2018) Bean counter A bean counter is seen as someone recording historic data, keeping score of past performance through “number crunching”, and acting as a financial gatekeeper or “corporate cop” to protect the financial resources from being spent by managers too easily.
Business partner Acts more actively for and with managers to support managerial decisions and should be in part responsible for decisions.
Comparing the different descriptions of roles in Table 3, several things stand out. Even though the bean-counter has widely been acknowledged, Rieg’s (2018) definition denotes a rather important position for this role, on the contrary Friedman and Lyne (1997) make this role seem trivial. Furthermore, it is apparent that Rieg’s (2018) definition resembles the ‘watchdog’, which is used interchangeably with the bean-counter by Windeck et al. (2013). Similarly, Heinzelmann’s (2013) ‘sparring partner’ is a member of the management team, which is also the case for Newman et al.’s (1989) ‘controller’. Thus, findings regarding roles and their definitions are inconsistent. Furthermore, the definitions in Table 3 seem to
reference a number of different tasks, highlighting the versatility of the profession. Consequently, a recurring classification tool for MA roles seems to be tasks and activities based. Literature uses these tasks and activities as a sensitizing tool for distinguishing roles, therefore a comprehensive overview is found in Table 4. Although this is only a sample of the many tasks mentioned, as completeness is out of the scope of this study.
Table 4: Tasks and Activities
Implementation and administration of financial systems
Hopper, 1980; Yazdifar et al., 2008; Weber, 2011; De Loo et al., 2011; Ahrens and Chapman, 2000
Satisfying managers’
information needs Hopper, 1980; Sathe, 1983; Byrne and Pierce, 2007; Verstegen et al., 2007; Maas and Matejka, 2009; Weber, 2011; Lambert and Sponem, 2012; Rieg, 2018; Newman et al., 1989
Preparing future budgets Hopper, 1980; Sathe, 1983; Byrne and Pierce, 2007; Yazdifar et al., 2008; Weber, 2011;
Paulsson, 2012
Producing budget results Hopper, 1980; Sathe, 1983; Byrne and Pierce, 2007; Yazdifar et al., 2008
Liaison with managers Hopper, 1980
Providing special reports
and investigations Hopper, 1980; Byrne and Pierce, 2007; Rieg, 2018 Pricing intercompany
14 Horizontal
communication Hopper, 1980; Newman et al., 1989; Granlund and Lukka, 1998a Hierarchical
communication Hopper, 1980; Newman et al., 1989; Granlund and Lukka, 1998a
Run Change projects Granlund and Lukka, 1998a; Burns and Baldvinsdottir, 2007; Verstegen et al., 2007; Hyvönen et al., 2015
Bookkeeping Friedman and Lyne, 2001
Strategy
formulation/implementati on
Burns and Baldvinsdottir, 2007; Yazdifar et al., 2008; Maas and Matejka, 2009; Paulsson, 2012; Rieg, 2018
Systems development Burns and Baldvinsdottir, 2005; Verstegen et al., 2007; Weber, 2011; De Loo et al., 2011
Administration Byrne and Pierce, 2007; Weber, 2011
Internal Reporting Verstegen et al., 2007; Maas and Matejka, 2009; Weber, 2011; De Loo et al., 2011; Paulsson, 2012
External Reporting Verstegen et al., 2007; Maas and Matejka, 2009; Weber, 2011; De Loo et al., 2011; Paulsson, 2012
Risk monitoring Verstegen et al., 2007; Rieg, 2018
Performance evaluation Yazdifar et al., 2008; Hyvönen et al., 2015
Cost, financial and/or
organizational control Yazdifar et al., 2008; Maas and Matejka, 2009; Weber, 2011; Lambert and Sponem, 2012; Hyvönen et al., 2015; De Loo et al., 2011
IT Yazdifar et al., 2008; De Loo et al., 2011
Representing the company’s economic situation
Weber, 2011
Internal analysis De Loo et al., 2011
Performing and interpreting business analyses
Hopper, 1980
Maintaining financial
records Newman et al., 1989 Long-term corporate
planning and strategic choice
Newman et al., 1989
Reporting information
retrospectively Friedman and Lyne, 1997; Verstegen et al., 2007; De Loo et al., 2011 Identifying problems and
suggesting solutions Newman et al., 1989 Enforcing and monitoring
compliance with procedures
Lambert and Sponem, 2012
In summary, additional to the dichotomy between bean-counters and business partners there are several other roles found in extant literature, such as the hybrid, watchman and the (sparring) partner. This diversity in roles is evident in the different description, as well as the designation of multiple names for more or less the same role. Although the found
inconsistencies may partially be attributable to semantics, MA roles clearly are versatile. In an attempt to capture the versatility of these roles, authors have used functions, and tasks and activities to serve as a stabilizing element in distinguishing roles. However, due to the change that management accounting is subject to this has not resulted in conclusive results.
Therefore, the next chapter will continue with factors relating to the developing nature of roles.
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3.1.2 Role attributes and change drivers.
The previous section outlined the diversity relating to MA roles, what is expected of them, what they actually do, and how their roles are described. This section will proceed with the analysis of how and why MA roles are subject to change. Throughout the analytical process, it was evident that the set of variables influential on MA role (change) is extensive. The
categorization of these variables included two steps. The first step was to extract variables from the articles. In order to capture variables specific to each article, the most relevant sections were results, findings, discussion, and conclusion. The second step was to find a suitable method of categorization. Byrne and Pierce (2007) used three levels of analysis in their categorization of antecedents (and characteristics) of MA roles, namely individual, internal (organizational) and external. Verstegen et al. (2007) used a similar approach, as they ascribed triggers to either the internal or external organizational environment, or being
person-related. In order to ensure the validity of the variables whilst providing a structured overview, this method appeared viable. An overview is found in Table 5.
Table 5: Factors and Levels
Author Individual Internal External
Hopper (1980) choice/ambition, traditional, unbiased,
conservative, bureaucratic decentralization, management style, turbulent markets
Otley (1980) accounting system,
organizational design environment, technology
Sathe (1983) interpersonal skills, technical competence, business judgment, cross-functional experience
structure, managerial culture, hiring/recruitment
Newman, Smart & Vattinsky (1989)
management training, accounting
skills Task structure
Friedman &
Lyne (1997) business orientation, adaptability, precise, honest, impartial, precision over content, boring, conservative, methodical
Activity-Based Techniques, position in the organization, business conditions environment, globalization, technical change, business conditions Granlund &
Lukka (1998a) use of non-financial info, participation/running change projects, critical, commercial orientation, communication skills, business knowledge, temporal orientation, cross-functional experience, trustworthiness, prudence, punctuality, accurate, behaviour
corporate culture,
decentralization, isomorphism, national culture, globalization
Granlund &
Lukka (1998b) globalization
Ahrens &
Chapman (2000) experience, objective, intuitive, status, drive economic pressure activity based costing institutions, ABC, organizational environment
Friedman &
Lyne (2001) boring, honest, rigid, irrelevant, stifling initiative/creativity, short-termism, single-minded, trustworthy
Scheytt, Soin &
16 Burns &
Baldvinsdottir (2005)
self-orientation, choice, trust, business
orientation, team player new management philosophies, strategic goals, organizational restructuring, influential groups/individuals, decentralization, perceptions, recruitment globalization, internationalization
Byrne & Pierce
(2007) choice, orientation, background, business knowledge, interpersonal and communication skills, IT skills, technical skills, monitoring skills, organizational influence, flexibility, personal qualities, approachability, commercial awareness, strength of character
size, structure, culture, technology, management support, nature and
circumstances, location in the organization, performance systems
regulation, environment
Järvenpää (2007) willingness, ability, business
orientation culture, structure, decentralization, hiring, recruitment, training, innovation, role modelling, top support
innovation, competition
Verstegen, de Loo, Mol, Slagter & Geerkens (2007)
experience, rationality/creativity,
extroverted/introverted size, ICT, position in the organization
Yazdifar, Askarany & Askary (2008)
analytical, business knowledge, team player, oral communication, IT skills, strategic thinking, leadership, change management
decentralization, ownership, isomorphism, restructuring, IT, management styles time, innovation, globalization, regulation Baldvinsdottir, Burns, Norreklit & Scapens (2009)
responsible, rational, objective,
detached, sober, attention to detail technological development, image
Maas & Matejka
(2009) involvement, behaviour, business orientation, loyalty, ambition
Lambert & Pezet
(2010) competition, self-reflection, self-discipline, pressure resistance collectivity, autonomy
Hartmann &
Maas (2010) involvement, machiavellianism, susceptibility to pressure
Hartmann &
Maas (2011) influence uncertainty uncertainty
Weber (2011) learning, knowledge (technical, systems, behavioural, economic, business) communication and IT skills, neutral, independent, ethos, creativity, adaptability interfaces De Loo, Verstegen, Swagerman (2011)
experience, age, gender,
thinker/executor size, financial status regulation
Abrahamsson, Englund & Gerdin (2011)
image/identity discrepancies practices
Lambert &
Sponem (2012) involved, independent, bureaucratic, ambition culture, structure, top management, internal client, institutional logic,
authority/empowerment
industry
Paulsson (2012) type of information, attention to group
processes, soft skills decentralization, performance management, accruals accounting
reforms, NPM
Goretzki, Strauss
& Weber (2013) reconstructing role identity, business orientation organizational orientation, an influential newcomer, proximity to operations, ERP-systems, decentralization, legitimization professional organization, institutional environment Windeck, Weber
& Strauss (2013) new business processes, strategy, IT-system, structure, resistance, management support, proximity to business, shifting power relations
17 Lambert &
Morales (2013) narratives, self-identity (discrepancies), dirty work, perceptions, business orientation
Heinzelmann
(2013) identity work, identity regulation, self-identity, the purpose of information
system emphasis professional bodies
Kim-Keung Ho
(2014) academic knowledge, knowledge of management disciplines creative holism
Hiller, Mahlendorf & Weber (2014)
prestige, identity conflict, organizational identification, professional identification, loyalty
Hyvönen, Järvinen & Pellinen (2015)
adaptability, business orientation, networking, participation in PMS/change projects, organization-specific competences, loyalty
top management support/trust/enablement, technology, collectivism, automation, outsourcing Horton & Araujo-Wanderley (2018)
identity conflict, job crafting, job discretion, involvement, behaviour
Taylor &
Scapens (2016) identity/image discrepancies, techniques, systems
Rieg (2018) qualification, position within the
department structure, ownership, size, capital market orientation, position department within the
organization
group affiliation
Caicedo, Martensson & Hallstrom (2018)
authority technology, lean
Building on the overview in Table 5, it is evident that MAs are subject to an abundance of influences, which have their effect on different levels. The role of an individual MA is therefore contingent on the external context of an organization and in turn that organizations’ internal context. The effects of the contextual variables are likely to have reciprocal effects, which indicates that MA roles are shaped by their environment. The list of personal attributes that explain MA roles is substantial and consists of factors that are either inherent to
personality or acquired skills. The personal attributes indicate that MAs are to an extent predetermined for a role, but can also choose to develop towards a role they believe suits them. In one’s self-perception, the concept of identity is central. Building on the notion of Goretzki et al. (2013) that identity reflects the role looking inwards, this aspect may
potentially be essential as a change driver on the individual level. Identity is an aspect of the individual level; however, the literature on identity is more abstract and based on concepts. In order to gain clarity on the subject, I decided to extract general definitions of several recurring concepts of the identity literature. An overview is found in Table 6.
Table 6: Identity Concepts
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Llewellyn (1999) Narratives Narratives represent the portrayal of actions and consequences based on the interpretation of participants, which is influenced by their identities Ahrens &
Chapman (2000) Occupational Identity The occupational identity reflects the general perception of characteristics of an occupation Abrahamsson,
Englund & Gerdin (2011)
organizational
image How we believe we are seen or want to be seen, by important others organizational
identity The way we perceive ourselves as an organization Identity
discrepancies The misalignment between organizational image and (desired future) external image Lambert &
Morales (2013) Identity regulation How organizational control is exercised through the orientation of these self-positionings and self-construction, in the form of discourses designed to influence individuals’ self-identity narratives
dirty work Members of an occupation create a positive image of their role and work, but that image remains vulnerable to (non- and mis-)recognition by audiences and may be undermined when tasks apparently
incompatible with their claimed identity must be done.
unclean work When people have to perform tasks they consider to be incompatible with the identity they claim, they see those ‘‘unclean tasks’’ as symbols of their misrecognition.
polluted work Activities that are theoretically consistent with the role pursued, or that should even be perceived as prestigious, but which can become demeaning in specific situations as audiences reposition them within practices reinforcing a devalued identity.
Heinzelmann
(2013) self-identity the precarious outcome of identity work comprising narratives of self identity work Identity work refers to people being engaged in forming, repairing,
maintaining, strengthening or revising the constructions that are productive of a sense of coherence and distinctiveness.
Hiller, Mahlendorf & Weber (2014)
professional
identification The extent to which an individual perceives oneness with his profession and with the prototypical characteristics ascribed to professionals in the field
organizational
identification The psychological merging of the organization and the individual
organizational-professional conflict
Conflicts between loyalty to their organization and loyalty to their profession
perceived occupational prestige
An occupational member’s belief in outsiders’ perceptions of the occupation.
Horton &
Araujo-Wanderley (2018) job crafting The physical and cognitive changes individuals make in the task or relational boundaries of their work job discretion The extent to which individuals have the freedom to alter the
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In brief, this paragraph identified a substantial number of factors that influence the roles of MAs. These factors take effect on roles on three different levels, namely the external, internal, and individual level. Thus, roles are contingent on the context of the MA and the
organization, as well as being subject to influences inherent to the MA. In addition to the static aspect found in the previous paragraph, this represents a dynamic aspect of MA roles.
3.2 Categorization
The previous paragraphs identified which factors influence the construction of MA roles. The next paragraphs will continue by discussing how these factors affect MA roles and the
connection between them.
3.2.1 Theories.
The selected literature on MA roles seems to be more conceptual than theory-based. This trend is in line with findings by Malmi and Granlund (2009) who stated that management accounting predominantly relies on theories that find their origin in other disciplines and are therefore hardly specific. Looking at Table1, there are four general theories that do however recur in the literature on MA roles. This section will outline how these theories may serve as a conceptual lens for analysing role construction.
3.2.1.1 Contingency theory.
Contingency theory finds its origin in organizational theory and is frequently related to management accounting. The central conception in contingency theory is that there is not one universal way that is best suited to run organizations (Otley, 1980). The theory describes how the context of organizations contains a substantial number of contingencies that influence whether certain choices and actions turn out successful or unsuccessful. Regarding management accounting, contingency theory is used in explaining management control systems design fit for organizations and the subsequent effects on performance (Chenhall, 2003). The contingencies relate either to internal to the organization or external to the
organization. These factors have been distinguished and consequently assigned to a number of variables, like technology, structure, external environment, culture and strategy (Chenhall, 2003). As these variables are interdependent, they should be regarded as a package. In
exploring MA roles and budgets, Hartmann and Maas discussed the effects of uncertainty as a contextual variable. The premise of their research was that uncertainty underlies all the
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aforementioned variables. Thus, uncertainty in an organization's internal and external environment leads to deviations in its contingency variables, which in turn affect business processes and decision-making. Hence why roles differ across contexts. As a result, MA roles are also dependent on certain aspects of contingency theory such as qualification, firm size, hierarchy, involvement, ownership and management style (Rieg, 2018; Byrne and Pierce, 2007). Byrne and Pierce further advocate the concept of fit between role attribute and MAs.
3.2.1.2 Institutional theory.
Institutions are defined as “a way of thought or action of some prevalence and permanence, which is embedded in the habits of a group or the customs of a people” (Hamilton, 1932). Burns and Scapens (2000) argued that institutions can potentially bring order to the collective activity of a group of individuals as habits and actions are produced and reproduced.
Routinization ensures that human activity evolves over time, which in turn allows for the institutionalization of procedures. This indicates that besides the effects of contingencies, there are also routines; the interplay reinforces the notion of both static and dynamic aspects. Furthermore, Burns and Baldvinsdottir (2005) used institutional theory to analyse MA’s new roles. They found that changing business conditions, resulting from globalization and
internationalization, created institutional contradictions that provided the conditions for change. These conditions allowed change agents to drive institutional change in praxis. Granlund and Lukka (1998b) used institutional isomorphism to explain the convergence of management accounting practices. They suggest that contextual factors such as increased global competition and transnational institutions cause the homogenization of management accounting. This would explain the diffusion of new roles for MAs. Byrne and Pierce (2007) also argued the effects of isomorphism, as legislation in subsidiaries of MNEs (coercive) and cultural norms and values (normative) affect MA roles. Goretzki et al. (2013) use institutional theory to explain how a new MA role can become embedded in an organization. They found that introducing an influential newcomer initiates institutional work, which in turn leads to MAs reconstructing their role identity to match the desired role and the legitimization of the new role. As the intra-organizational and extra-organizational environment affect each other mutually, they should be aligned accordingly, thereby allowing a new role to become
institutionalized. Hyvönen et al. (2015) describe a similar process through the concept of institutional entrepreneurship. They suggest that influential MAs can alter institutions and use their resources to ensure that role change is initiated.
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Role theory seeks to explain why organizational positions are carried out in certain ways. The essence of this theory is that every organization has focal roles and role senders. Role senders are the ones that are influential in shaping the expectations of focal roles. Role senders are in turn dependent on the organization’s characteristics, the focal roles’ personal capabilities and their mutual relationship (Kahn, 1964). Focal roles can potentially be important positions in an organization, which in this context would be the MA. The role senders are influential on the function of the focal role, therefore, management or HR can be role senders. Role theory suggests that there are multiple persons (partially) responsible for establishing the (MA) function. However, the influence of external factors should not be disregarded. As MAs become involved management, they need to carefully balance their responsibilities regarding involvement and independence (Sathe, 1983). This dual-responsibility makes MAs (Hopper, 1980) and BU controllers (Maas and Matejka, 2009) susceptible to increased levels of role conflict and role ambiguity. In turn, this may lead to MAs partaking in budget gaming, as the conflict of interest that arises may lead to MAs abusing their discretion regarding monitoring activities.
3.2.1.4 Social identity theory.
Goretzki et al. (2013) theorized that the reconstruction of role identity precedes the
institutionalization of a new role. McAdams (1999) defined identity as “the internalized and evolving story that results from a person's selective appropriation of past, present, and future.” Additionally, Ahrens and Chapman (2000) found that an MA’s role is often shaped based on its personal occupational identity, which comprises “the conscious awareness of oneself as a worker” (Skorikov and Vondracek, 2011). It has been suggested that people engage in so-called ‘identity work’, which Anderson and Snow (1987) defined as people's engagement in forming, repairing, maintaining, strengthening, or revising their identities. The above may potentially imply a reciprocal relation between one's identity and role. Lambert and Morales (2013) contributed to research on identity work by relating (self) identity narratives to the MA roles. An identity narrative functions as “a subjective sense of self-continuity as it
symbolically integrates the events of lived experience in the plot of the story a person tells about his or her life” (Ezzy; 1998). Lambert and Morales (2013) found that because of the substantial contrast in the MA roles the likelihood of a misfit between role and identity might also be larger. This, in turn, may have repercussions for the extent of identity work in which MAs partake. Ibarra and Barbulescu (2010) continued on this theory by discussing how identity work may be a critical factor in a period of work role transitions. Given the recent
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changes in management accounting roles, there may be salient relations within the subject of identity work.
3.2.2
Contextual dimensions.
This section will outline the dynamics regarding the contextual dimensions, which exists of the context relating to the internal organization and the external environment. Since variables relating to the external environment shape the internal environment, which in turn will shape the individual, the starting point will be the external environment. This section will gradually narrow down towards the individual.
3.2.2.1 External context.
The previous paragraph put forward how contingency theory aids the explanation of management accounting concepts. Since organizations are affected by contingencies this section will adhere to a number of general contingencies distinguished in extant literature (Otley, 1980), which this section will rely on to describe several of the external factors found in Table 5.
National culture.
Granlund and Lukka (1998a) compared the changing Finnish culture to the changing MA role (culture). They found compelling similarities between the bean-counter role and certain aspects of ‘Finnishness’ like prudence, withdrawal, keeping silent and low communication skills. However, they also found similarities for the new controller role like being able to draw conclusions, independence in a structure, being critical and straightforwardness. This may be the result of internationalization and Fins gradually evolving away from traditional
‘Finnishness’ as a result of a rejuvenation of MAs. Taken together, the national culture of the country the organization operates in affects MA roles. As culture is to some extent
hierarchical, national culture influences corporate culture (Järvenpää, 2007). Hence, national culture affects the MAs in organizations, as also found by Lambert and Sponem (2012).
External environment.
The institutional environment, globalization/internationalization and changing business conditions are used to discuss the external environment. In order to accomplish change, it is important to disrupt what is generally accepted. Burns and Baldvinsdottir (2005) argue that the conditions for institutional change occur through contradictions and subsequently putting new ideas into practice (praxis). Realistically, every organization is subject to institutional
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influences; changes in the management accounting function are therefore a result of several external forces. Moreover, Lambert and Sponem (2012) found that an organizations’ institutional logic was dependent on their industry, which in turn affected the design of the management accounting department. Granlund and Lukka (1998a) found that business practices were becoming increasingly internationally oriented and less dispersed.
Globalization may cause a more rapid diffusion of new (management accounting) principles, practices, and techniques. Besides, isomorphism describes how institutions become more alike across countries. Yazdifar et al. (2008) supported the effects of coercive isomorphism, as subsidiaries are under institutional pressure from parent companies. Other forms of coercive pressures are changes in regulation (de Loo et al., 2011) and government reforms (Paulsson, 2012). By aligning the internal and external environment, institutional work in one organization can diffuse through the wider institutional environment (Goretzki et al., 2013). Heinzelmann (2013) stressed the importance of an active professional community in
facilitating change, like the German ‘Controller Akademie’ (Goretzki et al., 2013).
Technology.
The turbulence of present-day business practices is partially a result of technological development. The effects of this development are also evident in management accounting. Yazdifar et al. (2008) found information technology to be the most important change driver regarding tasks and roles for MAs, signifying the need for enhanced information handling. The introduction of ERP-systems (Hyvönen et al., 2015) and Activity-Based-Techniques (Friedman and Lyne, 1997) have allowed management accounting information to be more useful. This increases the potential for management accounting to achieve a more business-oriented role. Given the high-affinity management accounting has with information systems, the possibilities for IT to be a change driver are widespread (Järvenpää, 2007). Baldvinsdottir et al. (2009) also find that over time the media have portrayed MAs as increasingly associated with system use. According to Hyvönen et al. (2015), being involved in ERP-projects
provides considerable advantages for MAs to develop towards new roles. These innovations reinforce the need for adaptability in MAs, as they risk becoming obsolete (Friedman and Lyne, 1997) or that the new tasks will be performed by for example IT-professionals (Weber, 2011). Briefly, innovation, through the rate of technical change (Friedman and Lyne, 1997) and technological development (Baldvinsdottir et al., 2009), influences MA roles.
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This section outlined how national culture, business conditions, institutions, globalization, and technology are contingencies for MA roles and role change on the external level. The next section will continue by describing how this affects the organizational context.
3.2.2.2 Internal context.
On the internal level, the relevant contingencies are structure and size, culture, technology, and strategy (Otley, 1980); this section will discuss a number of the variables relating to the internal context as found in Table 5 using these contingencies. Furthermore, Järvenpää (2007) put forward how the business orientation of management accounting consists of two elements, namely “the willingness and ability of management accounting to provide more added value to the management (decision-making and control) of the companies.” In this definition, the concept willingness refers to both the organization and the individual MA. This section will conceptualize the willingness of organizations by reflecting on how an organization can employ its resources to enable their MAs. In doing so, it uses notions of role theory, in the form of how the role sender affects the focal role. This section will discuss the organizations’ willingness; the individual level will be elaborated upon later.
Structure and size.
Järvenpää (2007) found that structural interventions precede MA role change. The two cornerstones of structural reorganizations regarding MA role change are decentralization of the MA function and involvement in management (Byrne and Pierce, 2007). Decentralizing MAs alters their responsibilities as it changes the direction of their activities from up the hierarchy to decentralized support services (Hopper, 1980). It provides MAs with the opportunity to move ‘towards the battlefield’ and away from the sidelines (Granlund and Lukka, 1998a), thereby enabling their business orientation. Physical decentralization allows for involvement in local operations and consequently in decision-making activities by changing their internal clients (Lambert and Sponem, 2012). In addition, Windeck et al. (2013) denoted that organizations with a matrix structure provided MAs with more opportunities for involvement, because of a more dynamic hierarchy. Therefore, the positioning of MAs is an antecedent of role change. This also applies to single MAs, as the head of the department is more likely to be involved in management (Rieg, 2018).
Where decentralization in itself may not always be sufficient, organizational restructuring may offer the solution. Disrupting existing cycles and shifting power bases can be tools to enable support. Structural factors can signal the opportunities and limitations of organizations,
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De Loo et al. (2011) found evidence for size and financial status as triggers for MA roles. Larger firms will likely opt for more decentralized MAs to ensure that they add value at multiple levels in the organization. Financial status may be more of an influence in
determining priorities for the MA department, by, for example highlighting cost control in times of financial distress. Byrne and Pierce (2007) further note ownership as an internal antecedent to the role of MAs. Yazdifar et al. (2008) support this, as dependent companies have to abide by the norms and values imposed by the parent company.
Corporate culture.
Byrne and Pierce (2007) found that differences in cultural values between organizations are role influences. This also argued by Järvenpää (2007), who uses cultural change interventions to describe how change is initiated. An organization may contain multiple role senders. Järvenpää (2007) put forward the role of top management support, who can participate in role modelling and attention directing. They can advocate new roles for MAs and tell stories of successful MAs, symbolizing the collective process of the role change. The desired cultural changes should be incorporated into official value statements. Windeck et al. (2013) stress the importance of management, as managers may have conflicting motives for accepting MAs new business partner role or not. They acknowledge the initial resistance that may be encountered, because of managers own work changing. The power of management can be exerted through providing management training (Newman et al., 1989) and empowerment (Lambert and Sponem, 2012). Introducing an influential newcomer (e.g. CFO) with a new vision for MAs can initiate role change (Goretzki et al., 2013). Burns and Baldvinsdottir (2005) also acknowledged a change agents’ impact through authority, conviction, and persuasion. Their influence was noticeable in hiring and recruitment as well, which finds support by Järvenpää (2007). Thus, multiple actors can initiate cultural change, which in turn drives MA role change internally. This is in line with role theory where role senders (local managers, top management) affect the focal role (MAs). Hyvönen et al. (2015) also argue that role change is a collective process. They found that a new role for controller’s forms through collective agency, which entails that managing change projects and networking raises the interest of multiple other parties, increasing the potential scope of change. Other literature also suggests the importance of collectivism in MA role change (Paulsson, 2012; Lambert and Pezet, 2010).
