Engaging facts and feelings in management accounting practices

Teemu Laine*, Petri Suomala, Natalia Saukkonen

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingConference contributionScientificpeer-review

Abstract

Purpose - This paper seeks to elaborate on how facts and feelings can be engaged in management accounting (MA) practice. The paper discusses a blueprint of new MA to be used in value and profitability management. The need for such a blueprint is defined in the following way: What does the interaction between facts and feelings mean for managing customer value and profitability, and how such interaction can be established? Such a blueprint ought to be at least widely and emotionally desirable, ergonomic and effective, durable and repairable, which have not been sufficiently addressed as design characteristics in the MA literature.

Design/methodology/approach - Besides a literature review on the processes of co-thinking and co-feeling in management accounting literature, we propose a more detailed approach for identifying the needs for accounting development and responding to them with a relation to the aforementioned challenges. In practice, we identify timely management challenges in different case environments, ranging from industrial operations to health care services. After that, we elaborate on the desired role of MA practice in responding to the identified challenges, as a basis for the proposed blueprint of new MA.

Originality/value - The paper is among the rare attempts to extend the theory and practice of management accounting with an approach that combines both analytical and emotional aspects of value and profitability management. The paper provides both a description of the needs for accounting development in different environments and an aggregate level agenda for turning such blueprint into action, i.e., the blueprint of new MA. Moreover, the paper responds to the need for better supporting managerial work by means of accounting information, with an explicit connection to the processes of value and profitability management in the companies.

Practical implications - The research gap underlying this paper is closely connected to the needs for developing management accounting practice according to the timely management challenges and recent technological advancements. After reading this paper, practitioners will be able to identify the needs for accounting development in their organizations, and translate the blueprint of new management accounting into a set of practical questions related to their own business context.

Original languageEnglish
Title of host publicationIFKAD 2015: 10TH INTERNATIONAL FORUM ON KNOWLEDGE ASSET DYNAMICS
EditorsJC Spender, G Schiuma, Albino
Pages1122-1132
Number of pages11
Publication statusPublished - 2015
MoE publication typeA4 Article in a conference publication
EventInternational Forum on Knowledge Asset Dynamics - Bari, Italy
Duration: 10 Jun 201512 Jun 2015
Conference number: 10

Conference

ConferenceInternational Forum on Knowledge Asset Dynamics
Abbreviated title IFKAD
CountryItaly
CityBari
Period10/06/201512/06/2015

Keywords

  • Management Accounting Practice
  • Value and Profitability Management
  • Facts and feelings
  • PERFORMANCE-MEASUREMENT
  • REFLECTIVE PRACTICE
  • CONTROL-SYSTEMS

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