An institutional perspective of accountants' new roles – the interplay of contradictions and praxis

Abstract

Recent years have witnessed a flurry of commentaries, mainly in the professional accounting literature, on new business-oriented roles for management accountants. Often premised on the generalisation of survey data, such work undoubtedly provides useful publicity to the underlying trends. However, to date, empirical research into the dynamics of role(s) change in actual organisations is scarce. This paper describes the emergence of new team/process-oriented roles for so-called ‘hybrid’ accountants in the manufacturing division of a multinational pharmaceuticals organisation. Adopting institutional theory, the following provides insight into role(s) change, as processes that encompass both institutional embeddedness and transformational agency. We highlight institutional contradictions that create potential openings for change, and discuss the praxis that underpin when, how and why role(s) change is carved out.

Acknowledgements

Both authors thank CIMA and ESRC for funding. Robert Scapens is warmly thanked for his helpful comments throughout the course of writing this paper – also Tony Berry, Dan Otzen and two anonymous referees.

Notes

¹ There is a myriad of such work including: Jablonsky et al. (1993), Sheridan (1994), PricewaterhouseCoopers (1997), IMA (1999), FMAC (2001), May (2001) and IFAC (2002).

² Although, in light of recent corporate scandals, such matters are certainly no less important than they were.

³ Järvenpää (2002) connects ‘business-orientation’ to Simon et al.'s (1954) ‘problem-solving’ role of accountants in which there is emphasis on managerial active duties like being advisor to the business and participating in general management activities. Mouritsen (1996) had also claimed similar roots when he distinguished between ‘involved’ and ‘independent’ roles.

⁴ Exceptions include Ahrens (1996), Jönsson (1996), Friedman and Lyne (1997), Granlund and Lukka (1998a), Brignall et al. (1999), Ahrens and Chapman (2000) and Järvenpää (2001).

⁵ There is no universal definition of an institution, nor is such debate within the scope of our paper. However, a typical view, and one that we adopt, is of ‘socially constructed, routine-reproduced programs or rule systems’ (Jepperson, 1991, p. 149).

⁶ There is some discussion in Burns and Scapens (2000) of the impetus from ‘external shocks’ or individuals' ‘idle curiosity’ but not too much discussion. In defence, however, Burns and Scapens do stress their framework as a ‘starting point’ for researching management accounting change in institutional time and space (p. 23).

⁷ Similarly, Butt's raw materials were charged on a break-even basis.

⁸ Or, as the business plan put it: ‘To be the supplier of choice – we must always remember that our customers have a choice.’

⁹ The total number of product streams across the four sites, by 1998, was 10.

¹⁰ And, reporting directly into the operation managers were the line managers and, into them, the operators.

¹¹ A term used by FM1, and adopted in our paper.

¹² Job rotation was less of an issue since involvement as a hybrid accountant immediately put the accountant into contact with many more people and with many more tasks than had previously been the case.

¹³ For their part, a sense of realisation did emerge amongst senior Finance personnel, including FM1. He conceded to more transparency and open-challenge under new organisational forms and set about reducing the cost of Finance (especially through downsizing).

¹⁴ As we came towards the end of our research, this function actually moved to one site (C) under the management of FM3.

¹⁵ It should be noted that there was surplus office space at site A, which was not the case at other operating sites. So, site A accountants also had desk space in the common finance office.

¹⁶ Suggestions were also made by more than one interviewee that FM3 possibly revelled in his local position of authority, and would unlikely welcome any developments that threatened it. However, for the record, a new finance manager was appointed (by the Finance Director) at site B in 1997, after which the physical diffusion of hybrid accountants occurred quickly under this new leadership.

¹⁷ In which the information provided by Finance (i.e. stock levels and projected profitability figures) played a big part.