Managerial Accounting: Analysis of Innovation in Canon and Apple

This report delves into the critical role of managerial accounting within the innovation processes of two major tech companies, Canon Inc and Apple Inc. It examines how managerial accounting components, such as decision-making, planning, and controlling, are integrated into product development. The analysis draws from a journal article comparing the firms' innovation management, highlighting how information creation and social interaction contribute to new ideas and features. The report explores specific examples, like Canon's mini copier and Apple's Macintosh computers, illustrating how team structures and information sharing facilitate innovation. Furthermore, it discusses lessons learned, emphasizing the importance of creating an environment that fosters information transmission, embraces chaos, and recognizes innovation as a human-based activity. The report concludes by highlighting the role of management accountants in influencing decision-making and understanding the impact of chaos on organizational capabilities.

Running head: MANAGERIAL ACCOUNTING
Managerial accounting
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MANAGERIAL ACCOUNTING
Table of Contents
Part B:...........................................................................................................................1
Answer to requirement 1:.............................................................................................1
Answer to requirement 2:.............................................................................................1
Answer to requirement 3:.............................................................................................1
References and Bibliography list:.................................................................................1

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Part B:
The role of the system of management accounting and accounting information
provisions in the process of innovation is evaluated in this section. Analysis of the
innovation process in the management accounting system is done by evaluating the
case of two major tech companies that is Canon Inc and Apple Inc.
Answer to requirement 1:
The journal article titled” Towards a new theory of innovation management: A
case study comparing Canon Inc and Apple Inc” compares the process of product
development at the innovative firms”. The article depicts on the process of
information creation that assisted the firms in renewing themselves. It has been
found from the analysis of article that the components of managerial accounting
have been incorporated in the development of product. Managerial accounting is the
process that is related with the analysis of financial data such as profit and costs that
helps in the process of decision making. Decision making, planning and controlling
are the components of the managerial accounting (Lorenz 2015).
The components of managerial accounting have been incorporated in the
product development process. The case of Canon Inc and Apple Inc which
conducted the process of development of product has witnessed the application of
managerial accounting components such as planning, controlling and decision
making (Guenther et al. 2015). The two case studies depict the dynamics of the
information creation process and the lessons that the management learned is also
generated.
At Canon Inc, the entire market of plan paper copier was reconceptualized for
developing the mini copier and the formation of feasibility study team that resulted in
the mini copier actualization. The feasibility team constitutes people from different
department such as product design, technical department, production, marketing and
research and development. A change in the concept was made for addressing the
issue and the new concept was emerged due to heated arguments. The
contradiction between cost and reliability was fundamentally managed by the team
by generating new ideas and features ((Nonala and Kenney 1991).
Now considering the case of development of Macintosh computers, the
components of managerial accounting such as decision making and planning was
also involved. A Macintosh group was formed for developing the product at lower
cost and making it available to public and with the help of such group it was possible
to examine the feasibility of the products. The project team comprised of the
manufacturing managers that formed an integral part and contributed considerably to
the development of Macintosh computers. From the analysis of the case of Apple Inc
and Canon Inc, it has been formed that the new features and ideas are created by
the formation of team with personnel’s from different divisions which contributed to
innovation process and information created (Nonala and Kenney 1991).
Answer to requirement 2:
Talking about the management of the system within an organization, and the
components that are associated with development and also the innovation of the

MANAGERIAL ACCOUNTING
products, it is said that management accounting is associated with the innovation
process. This paper involves the argument about the information regarding the
procedure to create products which assists in altering and also concretizing also
thereby also results in matching up the changing demands of the customers. So it
can be said that by changing the bureaucratic structures, better by moulding or
breaking, innovation in implementing several innovative techniques. One can better
understand the process of innovation when the personal working of the organization
conceptualized as creator of some information and not information processor. The
innovation in any kind of organization results in making of creative and innovative
techniques in improving the management accounting in any organization which
thereby results in product improvement (Nonala and Kenney 1991). The several
techniques and strategies are made and implemented in any organization for the
purpose of improving the products and their quality and which makes the products
unique in its own way, thereby creating product uniqueness and technological
competences.
Development of product at both Canon Inc and Apple Inc indicate that the
creation of information has been done by innovation that arose due to social
interaction. Recapitalization of the entire plain paper copier was the innovation that
contributed to the development of mini copier maintenance free. In addition to this,
the information generated by sharing of new ideas within the led also solved the
contradiction between cost and reliability. Another innovation at Canon was the
development of photo receptor, disposable apparatus and the toner fuser within the
target cost that is set (Nonala and Kenney 1991).
Development of Macintosh computers by Apple Inc was evolved because of
continuous interaction between the team that helped in generating new ideas. The
dimension of the telephone was based to the new computer which was innovated by
rethinking the features of personal computers that resulted from the transformation.
Such innovation enabled the introduction of Mac with compact look and distinct
design (Nonala and Kenney 1991).
The traditional method of command culture and control can thereby eliminated
by the freedom of security provision of innovation. There are case studies in the line
which reflects the information process which helps in the firm processing in self
renewing. The innovation process by mini copier by canon was a process in
continuation and widely spread throughout. Additionally in the meanwhile the
development of Macintosh which resulted from the creation of the innovation which is
brought about by the innovation process and also spread throughout which is
brought about by the continuous interaction in between the employees and the team
manager others in the organization for leading to the betterment of the plans and
schemes in the organization. The most primary and initial steps in any organization
is brought about by planning, controlling, decision making in the firm and then
constant interaction in between the project managers and the employees in finding
the solution of any problems in any organization (Nonala and Kenney 1991).
Answer to requirement 3:
The analysis of the article provides people with some useful insights into the
management accounting field and creation of innovation process. The components

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of management accounting such as planning, decision making and controlling. In
Apple Inc, the constant flow of information is brought by the creation of venture
capital and entrepreneurs. Japan market place is highly competitive and the constant
flow of innovation helps in supporting the growth of organization. It is essential for
the organization to create an environment that helps in transmission of information in
the ever changing and dynamic environment. The first lesson that is generated from
the article is that the environment accelerates the innovation process that is created
with the help of available resources. The second lesson that was learned from the
article is that the innovation is created in an environment due to the introduction of
chaos. Thirdly, it is ascertained that the innovation process was enhanced by the
theoretical project that contributed to the raw material. Innovation is regarded as the
human based activity that is neither dependent on deduction or induction (Nonala
and Kenney 1991). Therefore, organization places emphasis on emergence and
synthesis.
Some of the other product line was revitalized by Canon Inc in the creation of
mini copier. The powerful stimulus helped the company in prospering that created
the mini copier using the spin offs. Therefore, the new information was amplified by
the structuring of institutions and creating the information by transmitting the
information in the process of creation (Nonala and Kenney 1991).
Secondly, accountants are also provided information about the creation of
environment would help then in accelerating the process of innovation by generating
new information through creation of features and ideas. Such information is created
by introducing chaos and accountants should be able to understand the importance
of chaos (Wojtaszek 2016). Therefore, the organizations should be responsible for
processing the information with the help of their resources.
It has also been found that the creation of the human based activity
contributed to the innovation process with such activities do not basing it in either
deduction or induction. Management accountants play a considerable role in
influencing the decision making process and they should know that the components
of planning and controlling helps in generating the information. The effectiveness of
the accountants in the innovation process should be well understood by the
management accountant. They should be well acquainted with the facts that the
introduction of chaos should not be able to hinder the integrative capabilities of
organization. The role played by the chief executive officer should be well
understood by the management accountants that they do not act as facilitator and
rather act as catalyst in generating information (Chenhall and Moers 2015).

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References and Bibliography list:
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Managerial control and employee level outcomes. Journal of Business
Research, 68(2), pp.371-379.
Chen, Y., Podolski, E.J. and Veeraraghavan, M., 2015. Does managerial ability
facilitate corporate innovative success?. Journal of empirical finance, 34, pp.313-
326.
Chenhall, R.H. and Moers, F., 2015. The role of innovation in the evolution of
management accounting and its integration into management control. Accounting,
organizations and society, 47, pp.1-13.
Custódio, C., Ferreira, M.A. and Matos, P., 2017. Do general managerial skills spur
innovation?. Management Science, 65(2), pp.459-476.
Guenther, E., Jasch, C., Schmidt, M., Wagner, B. and Ilg, P., 2015. Material Flow
Cost Accounting–looking back and ahead.
Kamal, S., 2015. Historical evolution of management accounting. The cost and
management, 43(4), pp.12-19.
Lind, J., 2017. The role of accounting for managing innovation processes when
relationships matter. IMP Journal, 11(1), pp.7-24.
Lopez-Valeiras, E., Gonzalez-Sanchez, M.B. and Gomez-Conde, J., 2016. The
effects of the interactive use of management control systems on process and
organizational innovation. Review of Managerial Science, 10(3), pp.487-510.
Lorenz, E., 2015. Work organisation, forms of employee learning and labour market
structure: accounting for international differences in workplace innovation. Journal of
the Knowledge Economy, 6(2), pp.437-466.
Nguyen, T.T., Mia, L., Winata, L. and Chong, V.K., 2017. Effect of transformational-
leadership style and management control system on managerial
performance. Journal of Business Research, 70, pp.202-213.
Nonala, I. and Kenney, M., 1991. Towards a new theory of innovation management:
A case study comparing Canon, Inc. and Apple Computer, Inc. Journal of
Engineering and Technology Management, 8(1), pp.67-83.
Weygandt, J.J., Kieso, D.E., Kimmel, P.D. and Aly, I.M., 2018. Managerial
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Wojtaszek, H., 2016. Role of managerial accounting in the innovative
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