Strategic Cost Management and Outsourcing

The assignment requires students to read papers by Ghani et al, Holcomb and Hitt, Nielsen et al and Smith et al. Students must prepare some notes to discuss questions related to outsourcing, transaction cost theory, resource-based view, and strategic cost management. The assignment also asks students to compare CPA and CLV using the Andon et al paper and the Holm et al paper.

BFM 283 Strategic Management Accounting
Tutorial Activities
Each week you will be given essential papers to read which you will be asked to
discuss in the following weeks tutorial session.
In order to aid your evaluation each week you should consider the general questions
below and the specific questions relating to each weeks topic – each weeks
questions can be found under tutorial activities each week on BB but are also
reproduced here for ease:
List of potential questions to analyze research papers (adapted from Purugganan
and Hewitt, 2004. Weblink:
http://www.owlnet.rice.edu/~cainproj/courses/HowToReadSciArticle.pdf)
- Who are the authors? What journal is this?
- What is the terminology/what are they key terms informing this research?
- Have I taken the time to understand all the terminology?
- What specific problem does the research address? Why is it important?
- What is the sample/who are the respondents in this study?
- Which research methods are used?
- What are the main findings? Am I able to summarize them in one or two
sentences?
- Are these findings supported by persuasive evidence?
- How far can they be applied in other settings than the one(s) in which they
have been developed?
- What are the drawbacks of the research? How influential do I think they are on
the research outcomes?
- which insights does the paper provide to tackle the problem in the case at
hand?
Week 1 – The basic concepts of SMA
Research paper discussion questions
Activity
Read both the paper by Nixon and Burn and Langfield-Smith (these can be accessed
through your Talis list week1).
Prepare some notes to discuss the following questions:
1. What would be your definition of SMA?

Strategic management acounting is is the merging of strategic business objectives
with management accounting information to provide a forward looking model that
assists management in making business decisions.
2. What explanation would you give for the apparent stagnation of SMA?
Aparrent stagnation of SMA happens when the business concern conduct the
process of business making for along periode of time without proper implementation
of changes in SMA to keep at par with the canging business invironment. At this time
the SMA gets aparent ly stagnated.
3. What influence do you think organisational position and culture has on the use
of SMA?
Strategic management accounting creates a sustainable cost advantage. Companies
often use sustainable cost advantages to ensure their products are the most
competitively priced in the economic marketplace. Business owners also create a
sustainable cost advantage to avoid losing sales to substitute or inferior goods.
4. Do you perceive that there should be a greater link between management
accounting and strategic management?
Yes, i do persive that their should be a better link between SMA and management
accounting as SMA affects the dissision making of the firm at a positive note. SMA
creates a sustin able economic advantage to the firm and a greter link will enhance
this economic advantage.
5. Does the move the SMA require a different role for the management
accountant?
For a management accountant it is possible to do SMA on if he is skilled in certain
atributes. A different role will not be required the atribute required are:
 Big picture thinking
 Listening skills
 Commercial acumen
 Planning and Organizing
 Collaboration ability
 Critical/Lateral thinking.
 Execution skills.
These skills will help the management accountant to do strategic management
accounting.
Week 2 – The role of the Management Accountant
Research paper discussion questions

Activity
Read both the paper by Lambert & Sponem and Javenpaa (these can be accessed
through your Talis list week 2).
Prepare some notes to discuss the following questions:
1. How is the business partner orientation best defined?
A business stands on the loyalty and carecteristics of the associated partners. Proper
partners will add on to the profitability of the business. So the profile of the per son
who is entering into the partnership is needed to be analized that is the person's
basic attitude, beliefs, or feelings in relation to the prnership is needed to be check ed this
cchecking is termed as Business partner orientation..
2. Consider the 4 management accounting styles of Lambert and Spoonem –
how far do you agree that these styles exist? Which do you perceive to be the
most common/observable?
3. Do you agree with the assertion that authority influences whether a
management accountants role is technical or informative?
The role of management accountant is both tecnical as well informative. The keeping
of the account with reference to the theories and accounting standards prroves its
tecnicality. Where as information collection as well as presentation before the users
of accounting makes it informative as well.
4. Do you agree that culture is an important influencing factor in the management
accountants’ role?
Culture is a vital element of the business invironment. Change in culture can
positively as well negatively affect the profitability of the business. So we may
successfuly say that culture is a vital influencing factor in role of management
ccountant, that should reffered while dissision making of the firm.
5. How successful do you think the case company in Javanpaas article was at
achieving a business orientated role in management accounting?
In javanpaas article we come to know that the company has applied related
rules of management
Week 3 – Strategic Cost Management – The Value Chain
Research paper discussion questions

Activity
Read the papers by Shank and Govindarajan; Anderson and Prajogo, McDermott
and Goh (these can be accessed through your Talis list week 3).
Prepare some notes to discuss the following questions:
1. What is cost management?
Cost management is the process of planning and controlling the budget of a
business. Cost management is a form of management accounting that allows a
business to predict impending expenditures to help reduce the chance of going over
budget.
2. What does Anderson mean by structural and executional strategic cost
management?
Strategic cost management takes two forms: structural cost management, which
employs tools of organizational design, product design, and process design to build a
cost structure that is coherent with strategy; and executional cost management,
which employs various measurement and analysis tools.
3. How successful do you think the value chain is as a tool for focusing on
Strategic Cost Management?
Value chain analysis is a strategy tool used to analyze internal firm activities. Its goal
is to recognize, which activities are the most valuable (i.e. are the source of cost or
differentiation advantage) to the firm and which ones could be improved to provide
competitive advantage. So to focus on strategic cost management value chai
analisis is a important step that should be followed.
4. How might the findings of Prajogo et al help focus management accountant
attention?
The elements of the value chain differ in their association with product outcomes.
Marketing and production are related to product quality, but surprisingly while
research and development is related to product innovation, marketing is not.
Procurement is related to both product quality and product innovation. This is the
reason why the management accountant become more attentive.

Week 4 – Strategic Cost Management – Outsourcing
Research paper discussion questions
Activity
Read the papers by Ghani et al, Holcomb and Hitt, Nielsen et al and Smith et al
(these can be accessed through your Talis list week 4).
Prepare some notes to discuss the following questions:
1. To what extent can outsourcing be explored through the use of theoretical
viewpoints such as Transaction cost theory and the Resource based view?
2. How do you rate the framework provided by Ghani et al in making outsourcing
decisions?
3. Are the benefits of outsourcing supported by the research of smith et al?
4. What is role of management accounting in outsourcing purported by Smith et
al?
Week 5 – Strategic Revenue management
Research paper discussion questions
Activity
Read the papers by Andon et al, Holm et al and Kimes and Chase (these can be
accessed through your Talis list week 5).
Prepare some notes to discuss the following questions:
1. To what extent is the use of SRM restricted to service organisations?

2. What methods can be used to manage price and duration?
3. How can SRM evolve? Should there be a greater focus on technology or
competitors?
4. Utilising the Andon et al paper and the Holm et al paper compare CPA and
CLV
Week 6 – Cost Management
Research paper discussion questions
Activity
Read the papers by Mouritsen et al, Jacks & Jones and Woods et al (these can be
accessed through your Talis list week 6).
Prepare some notes to discuss the following questions:
1. To what extent does the research conducted by Mouritsen et al support the
use of target costing and functional analysis?
2. Can target costing be used successfully in a variety of organisational types?
3. How useful is Electronics company’s approach to using target costing?
Week 7 – Total Quality Management
Research paper discussion questions
Activity
Read the papers by Talib et al and Cockrell and Meyer (these can be accessed
through your Talis list week 7).
Prepare some notes to discuss the following questions:

1. To what extent do you perceive that TQM has a positive impact on the
organisations ability to create or add value in their management of the supply
(Value) chain?
2. How important is the management accountant to the success of TQM
initiatives?
To what extent do you agree with the conclusions made by Talib et al?
Week 8 – Multi-Dimensional Performance Measures
Research paper discussion questions
Activity
Read the papers by Wiersma, Hoque and Norreklit(these can be accessed through
your Talis list week 8).
Prepare some notes to discuss the following questions:
1. What purposes do managers use the BSC for according to Wiersma?
2. What conclusions can be drawn from Hoques evaluation of the use of the
scorecard to date?
3. To what extent do you agree with the cause and effect relationships of the
BSC?