Contemporary digital technologies provide new opportunities for organizing work within the finance function. In this study, we examine two digital technologies that are particularly relevant to the operation of finance functions – automation and analytics. We argue that variation in the use of these technologies is related to the interplay between firm-level digitalization strategy and the objectives of the finance function. Drawing on prior literature, we distinguish between two finance function objectives: an efficiency objective and a business partnering objective. Based on survey responses from 137 finance function professionals and complementary insights from 11 interviews, we show that the use of digital technologies within the finance function is associated with both firm-level digitalization strategy and the specific objectives of the finance function. Specifically, we find a positive interaction between an emphasis on firm digitalization strategy and an efficiency objective on the use of both automation and analytics. In contrast, digitalization strategy and a business partnering objective have positive but independent effects on the use of analytics. We also find that finance functions that simultaneously use automation and analytics have lower effectiveness, which might be a result of resource constraints. Overall, our paper adds to our understanding of the drivers and consequences of digitalization in the finance function.

In this paper, we build upon the crisis literature and theorisation of enabling design principles to examine how cost information was calculated and used in response to the COVID-19 crisis in public hospitals in New South Wales (NSW) Australia. This study analyses how various actors sought to respond to demands for cost information that was immediate, intense, and dynamic as the pandemic unfolded. In response, we observed two costing processes emerging. One focussed on the immediate pandemic funding requirements whilst the second addressed future activity-based funding requirements. The crisis created a situation in which matters present in business-as-usual costing practice became more visible. The four enabling design principles help us to theorise the complex interactions between how cost information might be constructed differently to relate to different purposes relating to both internal and global transparency.

BACKGROUND: Blunt chest injury is associated with significant adverse health outcomes. A chest injury care bundle (ChIP) was developed for patients with blunt chest injury presenting to the emergency department. ChIP implementation resulted in increased health service use, decreased unplanned Intensive Care Unit admissions and non-invasive ventilation use. In this paper, we report on the financial implications of implementing ChIP and quantify costs/savings. METHODS: This was a controlled pre-and post-test study with two intervention and two non-intervention sites. The primary outcome measure was the treatment cost of hospital admission. Costs are reported in Australian dollars (AUD). A generalised linear model (GLM) estimated patient episode treatment costs at ChIP intervention and non-intervention sites. Because healthcare cost data were positive-skewed, a gamma distribution and log-link function were applied. RESULTS: A total of 1705 patients were included in the cost analysis. The interaction (Phase x Treatment) was positive but insignificant (p = 0.45). The incremental cost per patient episode at ChIP intervention sites was estimated at $964 (95 % CI, -966 - 2895). The very wide confidence intervals reflect substantial differences in cost changes between individual sites Conclusions: The point estimate of the cost of the ChIP care bundle indicated an appreciable increase compared to standard care, but there is considerable variability between sites, rendering the finding statistically non-significant. The impact on short- and longer-term costs requires further quantification.

Purpose The authors examine how performance measurement systems (PMSs) and academic agency influence the meaning of research quality in practice. The worries are that the notion of research quality is becoming too simplistically and narrowly determined by research quality's measurable proxies and that academics, especially manager-academics, do not sufficiently realise this risk. Whilst prior literature has covered the effects of performance measurement in the university sector broadly and how PMSs are mobilised locally, there is only little understanding of whether and how PMSs affect the meaning of research quality in practice. Design/methodology/approach The study is designed as a comparative case study of two university faculties in Finland. The role of conceptual analysis plays a notable role in the study, too. Findings The authors find that manager-academics of the two examined faculties have rather similar conceptual understandings of research quality. However, there were differences in the degree of slippage between the “espoused-meaning” of research quality and “meaning-in-practice” of research quality. The authors traced these differences to how the local PMS and manager-academics’ agency relate to one another within the context of increasing global and national performance pressures. The authors developed a tentative framework for the various “styles of agency”. This suggests how the relationship between the local PMS and manager-academics’ exerted agency shapes the “degrees of freedom” of the meaning of research quality in practice. Originality/value Given that research quality lies at the heart of academic work, the authors' paper indicates that exploring the three matters – performance measurement, the agency of manager-academics and the meaning of research quality in practice – in combination is crucial for the sustainability of the academe. The authors contribute to the literature by detailing the way in which local PMS and manager-academics' agency have material impacts on what research quality means in practice. The authors conclude by highlighting the pressing need for manager-academics to exercise the agency in efforts to safeguard a broad and pluralistic understanding of research quality in practice.

This study examines how the risk of labour standards noncompliance can be rendered calculable and commensurable through a market device. We present a case study of the Cleaning Accountability Framework (CAF), an industry certification scheme, which seeks to address labour exploitation in the Australian contract cleaning industry. We pay particular attention to the central device of the certification scheme – the pricing schedule. We examine how the pricing schedule shaped the calculative space informing contracting parties during the procurement process. In doing so, the pricing schedule increased transparency around the potential risk of labour standards noncompliance. The nature of this transparency and the perceived objectivity of the pricing schedule acted to reshape the market for contract cleaning, resulting in a redistribution of accountability for labour exploitation. We also examine how the pricing schedule formed part of a wider framework of accountability, and how these mechanisms enabled strategic co-enforcement of labour standards compliance by supply chain stakeholders. Overall, our study indicates the potential for accounting practices to play a more active role in shaping how markets address modern slavery risks.

External knowledge search is critical for innovation performance and centers on a firm's absorptive capacity. This study investigates whether and how two dimensions of absorptive capacity at the top management team (TMT) level, potential absorptive capacity and realized absorptive capacity, are influenced by two design choices of the performance measurement system (PMS), broad scope PMS and PMS integration, under different conditions of environmental dynamism. Based on cross-sectional survey data from firms in innovative industries, the results of our empirical study indicate that in more dynamic environments, a broader scope PyMS is associated with higher potential absorptive capacity whereas higher PMS integration is associated with lower potential absorptive capacity. These associations are not observable in more stable environments. Moreover, broad scope PMS and PMS integration are both positively associated with realized absorptive capacity, independently of environmental dynamism. These findings highlight the relevance of PMS design choices for absorptive capacity, showing on the one hand the differences between the implications of broad scope PMS and those of PMS integration and, on the other hand, that the implications of PMS design choices for potential absorptive capacity (i.e. acquisition and assimilation of external knowledge) follow different patterns than the implications for realized absorptive capacity (i.e. the transformation and exploitation of such knowledge).

Prior research examining the consequences of specific performance measurement system (PMS) design attributes is largely focused on processes and decisions at an individual level. We extend this research by examining how PMS design attributes interact with group socio-cognitive processes to influence firm level outcomes. Specifically, we examine how the interaction between two PMS design attributes related to comprehensiveness – scope and integration – and top management team (TMT) cognitive conflict affect the achievement of innovation ambidexterity. Based on cross-sectional data collected from a survey of TMT members of 90 firms operating in innovative industries, we find that PMSs with broad scope positively interact with cognitive conflict, leading to higher innovation ambidexterity, while highly integrated PMSs negatively interact with cognitive conflict, leading to lower innovation ambidexterity. Overall, our study demonstrates the importance of disentangling the interplay of different PMS design attributes with group socio-cognitive processes for understanding how firms achieve innovation ambidexterity.

Prior research has shown that that management control practices change in response to global crises, yet we have little understanding of the behavioral consequences of these changes. The purpose of this study is to explore the behavioral effects that stem from crisis-induced changes to management control practices and the factors that intensify or diminish these effects. Using survey data from business unit managers in the Netherlands, our results show that firms tighten their budget controls in response to a negative impact of Covid-19. In turn, the tightening of budget controls is positively associated with employees' emotional exhaustion because of increased perceptions of role ambiguity and role conflict. We furthermore find that the effect of tighter budget controls on role ambiguity is mitigated when managers perceive that the budget controls are used in an enabling way prior to the crisis but heightened with increased trust in senior management. These results suggest that if firms use their budgets to help managers acquire a deeper understanding of their tasks and responsibilities, they are better able to respond to a negative shock and the accompanying tightening of budget controls, which helps mitigate the undesired behavioral response of increased role ambiguity and emotional exhaustion. Our findings also suggest that trust, which usually is beneficial to organizations, has a ‘dark’ side in that managers will push themselves harder to reciprocate the trust they have in their senior managers, which exacerbates the effect of tighter budget controls on role ambiguity and, in turn, emotional exhaustion.

Most cross-cultural studies on management control have compared Anglo-Saxon firms to Asian firms, leaving us with limited understanding of potential variations between developed Western societies. This study addresses differences and similarities in a wide variety of management control practices in Anglo-Saxon (Australia, English Canada), Germanic (Austria, non-Walloon Belgium, Germany) and Nordic firms (Denmark, Finland, Norway, Sweden). Unique data is collected through structured interviews from 584 strategic business units (SBUs). We find that management control structures in Anglo-Saxon SBUs, relative to those from Germanic and Nordic regions, are more decentralized and participative and place greater emphasis on performance-based pay. Comparing Germanic SBUs to Nordic ones, we find Germanic SBUs to rely more on individual behaviour in performance evaluation, whereas Nordic SBUs rely more on quantitative measures and value alignment in employee selection. We also observe numerous similarities in MC practices between the three cultural regions. The implications of these findings for theory development are outlined.

Despite the economic significance of private equity (PE) firms, there has been limited investigation into the control mechanisms they implement to manage relationships with their portfolio companies. Through a comparative field study, we describe the role and characteristics of controls implemented by PE firms and the contextual factors associated with the relative importance of different control mechanisms. Evidence shows that control mechanisms play an important role in directing the actions of portfolio companies and that there is significant variation between PE firms in terms of the combination of formal contracting, results, behavior, and social controls that are relied upon. We find that the primary factors associated with the choice of control combination are the equity arrangement and the perceived cognitive style of top management in the portfolio company. From our analysis, we derive a framework of four control combinations that are aligned to variations in these two factors. Our analysis also points to the potential interdependencies that arise between control mechanisms within each control combination.

BackgroundPatients are at risk of deterioration on discharge from an emergency department (ED) to a ward, particularly in the first 72 h. The implementation of a structured emergency nursing framework (HIRAID) in regional New South Wales (NSW), Australia, resulted in a 50% reduction of clinical deterioration related to emergency nursing care. To date the cost implications of this are unknown. The aim of this study was to determine any net financial benefits arising from the implementation of the HIRAID emergency nursing framework.MethodsThis retrospective cohort study was conducted between March 2018 and February 2019 across two hospitals in regional NSW, Australia. Costs associated with the implementation of HIRAID at the study sites were calculated using an estimate of initial HIRAID implementation costs (AUD) ($492,917) and ongoing HIRAID implementation costs ($134,077). Equivalent savings per annum (i.e. in less patient deterioration) were calculated using projected estimates of ED admission and patient deterioration episodes via OLS regression with confidence intervals for incremental additional deterioration costs per episode used as the basis for scenario analysis.ResultsThe HIRAID-equivalent savings per annum exceed the costs of implementation under all scenarios (Conservative, Expected and Optimistic). The estimated preliminary savings to the study sites per annum was $1,914,252 with a payback period of 75 days. Conservative projections estimated a net benefit of $1,813,760 per annum by 2022–23. The state-wide projected equivalent savings benefits of HIRAID equalled $227,585,008 per annum, by 2022–23.ConclusionsThe implementation of HIRAID reduced costs associated with resources consumed from patient deterioration episodes. The HIRAID-equivalent savings per annum to the hospital exceed the costs of implementation across a range of scenarios, and upscaling would result in significant patient and cost benefit.

AIMS: This study aimed to quantify the health economic treatment costs of clinical deterioration of patients within 72 h of admission via the emergency department. METHODS: This study was conducted between March 2018 and February 2019 in two hospitals in regional New South Wales, Australia. All patients admitted via the emergency department were screened for clinical deterioration (defined as initiation of a medical emergency team call, cardiac arrest or unplanned admission to Intensive Care Unit) within 72 h through the site clinical deterioration databases. Patient characteristics, including pre-existing conditions, diagnosis and administrative data were collected. RESULTS: 1600 patients clinically deteriorated within 72 h of hospital admission. Linked treatment cost data were available for 929 (58%) of these patients across 352 Australian Refined Diagnosis Related Groups. The average (standard deviation) treatment costs for patients who deteriorated within 72 h was $26,778 ($34,007) compared to $7727 ($12,547). The average hospital length of stay of the deterioration group was nearly 8 days longer than patients without deterioration. When controlling for length of stay and Australian Refined Diagnosis Related Group codes, the incremental cost per episode of deterioration was $14,134. CONCLUSION: Clinical deterioration within 72 h of admission is associated with increased treatment costs irrespective of diagnosis, hospital length of stay and age. Implementation of interventions known to prevent patient deterioration require evaluation.

This paper discusses several conceptual and empirical issues related to understanding combinations of management control (MC) practices. First, the paper clarifies the meaning of the two main perspectives for investigating MC combinations – MC packages and MC systems. Second, the paper considers how researchers can improve theory development concerning the effects of MC combinations by explicating the causal mechanisms through which they arise. Third, the paper discusses whether loose coupling provides an informative perspective for understanding MC combinations, particularly in relation to how organizations adapt MC practices to contextual changes. Finally, the paper comments on the main empirical approaches for investigating MC combinations. Recent studies, especially those in this special issue, are drawn upon to illustrate how these issues relate to MC research.

This study examines the influence of cultural regions on the interdependence between delegation of authority and other management control (MC) practices. In particular, we assess whether one of the central contentions of agency theory, that incentive contracting and delegation are jointly determined, holds in different cultural regions. Drawing on prior literature, we hypothesise that the MC practices that operate as a complement to delegation vary depending on societal values and preferences, and that MC practices other than incentive contracting will complement delegation in firms in non-Anglo cultural regions. Using data collected from 584 strategic business units across three Western cultural regions (Anglo, Germanic, Nordic), our results show that the interdependence between delegation and incentive contracting is confined to Anglo firms. In the Nordic and Germanic regions, we find that strategic and action planning participation operate as a complement to delegation, while delegation is also complemented by manager selection in Nordic firms. Overall, our study demonstrates that cultural values and preferences significantly influence MC interdependence, and suggests that caution needs to be taken in making cross-cultural generalisations about the complementarity of MC practices.

This study explores the decision-facilitating role of performance measurement systems (PMSs) in firms attempting to translate competence ambidexterity (i.e., the simultaneous pursuit of exploration and exploitation) into innovation ambidexterity outcomes (i.e., the achievement of both radical and incremental innovations). Drawing on paradox and organisational conflict literature, this study emphasises the role of cognitive conflict, generated by PMSs, in shaping the relationships between competence ambidexterity and innovation ambidexterity. Based on survey data from a sample of 90 Irish firms, our findings indicate that competence ambidexterity is associated with (a) the choice to have a balanced set of performance measures, and (b) the use of PMSs for frequent and intensive debate between top managers. Furthermore, the study reveals that these choices are interdependent, as they function as complements in generating cognitive conflict, which in turn drives the realisation of innovation ambidexterity outcomes. The results also show that cognitive conflict is not directly associated with the development of competence ambidexterity, but is instead generated through the conjoint action of a balanced PMS design and the use of PMSs for intensive debate. Overall, this study demonstrates the interdependent nature of choices concerning the design and use of PMSs, and the significant role of PMSs as generators of cognitive conflict in firms attempting to achieve ambidexterity.

ABSTRACT The capacity for survey-based research to advance theoretical knowledge is heavily dependent on the degree to which the measures used capture the constructs that they are intended to represent. Despite the importance of construct validity, the management accounting and control (MAC) literature tends to devote less attention to construct validity than other areas of organizational research. In this article, we discuss contemporary thinking about construct validity and examine how this compares to established practice in MAC research through a systematic review of survey studies from 1996 to 2015. Based on this review, we identify four areas where greater attention is warranted: specifying construct dimensionality, justifying the choice of the measurement model, distinguishing between causal indicators and composite indicators in formative measurement models, and being judicious in the use of single item measures. We discuss the implications of each issue and provide suggestions on how they can be addressed.

ABSTRACT This article presents an inventory of constructs measured in survey-based management accounting and control (MAC) research from 1996 to 2015. The inventory is intended to serve as a reference source for researchers to identify prior operationalizations of constructs of interest.