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Management accounting in support of the strategic management process Logo cima

  Dr Graham Simons Pitcher |   Free |   CIMA |   Mar 2015 |   Thought leadership

The findings of this study, based on 14 interviews with finance professionals working in business, indicate that despite not using the term SMA, accountants can, and do, make an active contribution to the strategic management process. The range of techniques utilised may not be as extensive as previous studies into SMA have suggested. Also the degree to which accountants are able to become involved is influenced by organisational factors, the range of attributes possessed by the accountant, and the practicalities involved in enabling the accountant to perform his/her role. The closest term that defines the role of accountants when involved in the strategic management process is that of â€˜business partnering'.

Topics covered:
  • Management accounting: Business: Strategy, Advanced
  • Management accounting: Technical: Management reporting & analysis: Financial analysis, Advanced

10 Comments/Reflections

Angela Jameson

Angela Jameson Sep 2019

Dengmei Xia

Dengmei Xia Dec 2017

It is a question worth considering what a role management accounting play in the strategic management process. In my opinion, it can help company plan the future of the business scientifically, allocate resources rationally and mobilize the positive factors of business. Also, I agree with idea that organizational influences, accountant led influences and practicalities are three factors which can influence the degree to which accountants were involved in the strategic management process. Sometimes, there may be a desire by the accountant to become involved, the organisational influences and practicalities may limit the degree to which this is possible. In this background, accountants should improve their abilities as much as possible and play a more important role.
Bekithemba Hwalima

Bekithemba Hwalima May 2016

Interesting perspectives on the practical contribution of management accounting to the strategic management process. Accountants contributions are influenced by three factors, being organisational, accountant led and practicalities.
Susan Swift

Susan Swift May 2016

Useful, showing a gap between idealised and actual management ac to support strategy. 
Lack of external focus v swot analysis: track competitors position and pricing but not deeper analysis.
Financial analysis : to extent that strategy has potential to be viable, then use monitor margins reforecasting and variance analysis to signal strategic action needed
Of strategic management ac techniques available, ABC, benchmarking,customer profitability at contribution level,market position prices and products monitored, capital budgeting appraisal used
But missed out on strategic pricing: using cost plus or market pricing
Missed out on target costing/pricing
So missed opportunities available to add value...
John Orcott

John Orcott Jan 2016

The need to be pro-active and use more advanced techniques is required if the strategic management process is to be effective in most companies.