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Competition and the performance of strategic business units ‐ A study of the South African beverage industry

C.M. Ambe (Department of Accounting, Technikon Northern Gauteng )
K. Sartorius (School of Accountancy, Wits University)

Meditari Accountancy Research

ISSN: 1022-2529

Article publication date: 1 April 2002

512

Abstract

Historically, South Africa’s apartheid policies had a negative effect on the financial performance of the South African beverage industry. This effect was characterised by the non‐participation of South African companies in the global market and the presence of foreign enterprises in the domestic market. From 1994, South African industries have been increasingly exposed to new opportunities and forces. Globalisation, deregulation, changing manufacturing systems and the entry of foreign competitors in the 1990s exposed the local industry to competitive challenges in the domestic and the global market. This study examined the impact of changing levels of competition on the performance of strategic business units and the mediating role of management accounting in the South African beverage industry. The methodology employed to investigate this relationship comprised both a survey and a case study. The results indicate a positive correlation between the level of competition and the performance of business units. The results furthermore indicate that enterprises can utilise a management accounting system (MAS) as a strategic response to competition. The increased use of MAS will, in turn, improve the performance of an enterprise. Enterprises that do not respond positively to competition will not survive.

Keywords

Citation

Ambe, C.M. and Sartorius, K. (2002), "Competition and the performance of strategic business units ‐ A study of the South African beverage industry", Meditari Accountancy Research, Vol. 10 No. 1, pp. 1-23. https://doi.org/10.1108/10222529200200001

Publisher

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MCB UP Ltd

Copyright © 2002, MCB UP Limited

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