The Effects of Management Accounting and Control Systems Accounting Essay

This study investigates the effects of management accounting and control systems and organizational learning on business process agility and competitive advantage. Many industries previously considered as relatively stable have changed into rapidly aggressive and turbulent environments. These environmental changes are triggered by changes in consumer preference, competitors' actions, regulatory or legal, economic shifts, and technological advancements, which create more uncertain and unpredictable environments for firms. Researchers have proposed many alternatives as guidance to firms when facing these challenges. Recently, some researchers propose that firms must develop dynamic capabilities to renew, reconfigure, and adapt existing firm-specific resources in response to the fast changing environment (Teece et al., 1997; Eisenhardt & Martin, 2000; Teece, 2007). Since building dynamic capabilities requires internal processes and efforts rather than acquisitions from market transactions, they are the most unique and difficult-to-imitate assets that firm can use to achieve and sustain a competitive advantage (Teece, 2007).
One of the predominant focuses in dynamic capability perspective is the notion of "agility". Characterised by the capabilities to quickly sense and response to changes, agility has been recognized in information systems (IS) literature as a "higher-order" capability of firms (Raschke, 2007). An agile firm is argued as capable to deal with rapidly evolving situations, survive unexpected threats and succeed in competitive environments (Lu & Ramamurthy, 2011). Therefore, the understanding on how agility can be developed is crucial for firms. However, despite growing interest in agility, most studies remain theoretical and conceptual and call for more empirical research to examine this perspective (Raschke, 2007). As a result, research into how firms build agility as a dynamic capability remains scant.