Emerald | Business Strategy Series | Table of Contents

Management control in accounting outsourcing services

Fri, 08 Mar 2013 00:00:00 +0000

Abstract

Purpose – The purpose of this paper is to provide evidence of accounting outsourcing practices in Malaysia and the management control strategies undertaken by these practising firms to mitigate inherent risks. Design /methodology/approach – This study employs survey methodology using structured questionnaires and case studies using interviews. A total of 51 companies responded to the questionnaires and two companies participated in the interview. Findings – The survey data revealed that the primary reason for engaging in accounting outsourcing was to gain quality accounting service from the experts. With regard to management control strategies, it was shown that respondents place high emphasis of behavior, output and social controls. Further investigation using case studies involving a vendor and client companies reveal that the control mechanisms involved were stated in the outsourcing contract, namely the use of Key Performance Indicators (KPIs) and penalties. Informal controls were also used in both cases to assist in solving conflicts and dissatisfaction among vendors and clients. Research limitations/implications – The identification the control strategies in the accounting outsourcing process is useful for companies to manage the inherent risks in outsourcing relationships. The knowledge on the control practices by firms involved in accounting outsourcing provides additional assurance to potentials interested in seeking accounting services in this country. Originality/value – This paper is driven by the lack of empirical evidence of accounting outsourcing practices in Malaysia and paucity of research into the role of management control in an outsourcing relationship. Despite the growth of the outsourcing industry in Malaysia, little has been done to understand the contribution of a professional service sector such as the accounting services to this industry.

Too early to execute the strategic scenario planning: hyperbolic discounting and psychological biases of Indonesian SMEs' managers

Fri, 08 Mar 2013 00:00:00 +0000

Abstract

Purpose – Using the hyperbolic discounting approach in qualitative manner, the purpose of this paper is to explore the linkage of the time preference bias towards the too early execution of strategic focused planning. The paper also investigates the role of psychological bias in explaining the early execution. Design/methodology/approach – This research use qualitative methods to explore the role of hyperbolic discounting in driving the psychological bias towards too early strategic scenario planning, and its rationalization. The authors conducted a face-to-face survey going door-to-door of the small to medium-sized enterprises (SMEs). The samples in this research are Indonesian SMEs from the northern part of Sumatra. Findings – This research found most of the SMEs' managers are time preference biased due to hyperbolic discounting. This hyperbolic discounting awoke manager's psychological bias and resulted in too early decision making. This psychological bias might be due to prospect theory, or the representative effect, or framing bias, or the adaptive bias. Research limitations/implications – The sample is only taken from Northern part of Indonesia. To have a robust generalization, the research should be conducted in the whole of Indonesia. Practical implications – This paper can be used by practitioners to understand their behaviour towards strategic decision making. Further, practitioners will know if their time preference bias will not generate better result.

Marketing Islamic banking products: Malaysian perspective

literatinetwork@emeraldinsight.com (Yusniza Kamarulzaman, Azian Madun) — Fri, 08 Mar 2013 00:00:00 +0000

Abstract

Purpose – The rapid growth of Islamic banking in Malaysia warrants banking institutions being more proactive and innovative in marketing their products. The purpose of this paper is to re-evaluate the progress and achievements of Islamic banking in Malaysia, particularly in the area of sales and marketing of Islamic banking services. Design/methodology/approach – This paper adopts a comprehensive literature review from various published sources. All related references were discovered through electronic databases, journals and books in the area of the relevant literature in Islamic finance, banking and services marketing. Findings – The driving force for the growth of Islamic banking and financing products is the corporate clients, and not the Muslim individuals. In fact, the non-Muslim individuals also use Islamic banking if they find that the service is good and meets their expectations. This paper shows evidence that the marketing activities of Islamic banking products is relatively ineffective compared to the conventional banking products in Malaysia. This paper also discusses the reasons for the ineffectiveness of marketing Islamic banking products at the micro and macro-level. Depending on religion alone is not the best strategy to attract customers. Practical implications – The products offered by the Islamic banking system have to compete with those of the conventional banking system. Hence, a continuous review of marketing strategies for Islamic banking products is crucial in every Islamic financial institution. Originality/value – This paper fulfils a need to study whether the common methods in marketing conventional banking products would be effective in the context of marketing Islamic banking products.

The effects of customer focus on new product performance

literatinetwork@emeraldinsight.com (Sany Sanuri Mohd Mokhtar) — Fri, 08 Mar 2013 00:00:00 +0000

Abstract

Purpose – The purpose of this paper is to investigate the relationship between customer focus and new product performance. Design/methodology/approach – Senior management of Malaysian manufacturing firms was the target respondent of this study. Data were collected using mail questionnaire survey approach. Findings – The results revealed that customer focus has a statistically significant association with new product performance; hence, the proposed hypothesis of the study is supported. Practical implications – The outcome of this study provides vital information from Malaysian firms' perspective on the practical relationship of customer focus on new product performance. Originality/value – This paper offers a better understanding for senior management of manufacturing firms to engage with customers in developing a new product.

Strategies used by a meatpacking company for market competition

Fri, 08 Mar 2013 00:00:00 +0000

Abstract

Purpose – This article aims to identify strategies used by a midsize meatpacking plant company located in the state of Rio Grande do Sul, Brazil, in order to remain competitive in the market. Thus, the purpose of this paper is to understand which strategies the company uses and how those have been designed according to the company managers. Design/methodology/approach – Concerning the methodology, a descriptive research was developed as a case study. The data collection was accomplished through researches on official company documents which describe its history and are used for several tasks. This information source pointed out critical events during the history of the organization which allowed the researchers to identify the strategies developed and implemented through its leaders' insight during those historical periods when the company was in crisis. Findings – Mintzberg and McHugh's model was applied to identify strategies, as well as discovering the effects they obtained by using them. It has been observed that in order to remain competitive in the market, the company used strategies classified as Deliberate-Accomplished and Emergent. Originality/value – Through this case study it has been possible to identify the strategies created and applied by the meatpacking company's managers in order to remain competitive in the market.

Investigating the mediating role of organizational politics between leadership style and followers' behavioral outcomes

literatinetwork@emeraldinsight.com (Talat Islam, Saif ur Rehman, Ishfaq Ahmed) — Fri, 08 Mar 2013 00:00:00 +0000

Abstract

Purpose – The purpose of this paper is to investigate the mediating role of perceptions of organizational politics between leadership style, on the one hand and performance, commitment and organizational citizenship behavior (OCB) on other hand. Design/methodology/approach – A multifactor questionnaire was distributed among public employees of Pakistan (n=271). They were asked about their head of department's leadership style and perception of politics in the organization. In addition to this in-role performance, commitment and OCB were also examined. The confirmatory factor analysis (CFA) was analyzed with structure equation modeling and exploratory factor analysis (EFA) were analyzed for intra structure of the leadership variables. Two models were examined: first, with the mediation role and second,without the mediation role. Findings – A partial mediation of leadership style was found with commitment and OCB. Organizational politics was found to be negatively related with the behavioral outcomes (i.e. commitment, in-role performance and OCB). Research limitations/implications – The models do not show clear results of mediation or the direct effect of politics between leadership styles on one hand and commitment, performance and OCB on other hand. Practical implications – Managers and heads of departments should know about the merits and demerits of leadership styles, as these may affect the political behavior which ultimately damages the performance, commitment and OCB. Originality/value – The findings of the present study will contribute to existing literature regarding leadership and politics.