Sociological Approaches to Organizational Learning: Applications to Process Innovations in Management Accounting Systems ^☆

Advances in Management Accounting, Forthcoming 2014. First submission October 2012; Revised submission May 2013; Accepted October 2013. This paper introduces our book titled, An Organizational Learning Approach to Process Innovations: The Extent and Scope of Diffusion and Adoption in Management Accounting Systems, Emerald Studies in Managerial and Financial Accounting, Volume 24, 2012 (Sisaye & Birnberg, 2012). We are very grateful for the continued editorial assistance and support that we have received from the editors: Marc J. Epstein and John Y. Lee over the years. We have benefited from the comments of the two external reviewers in preparing the manuscript for publication. The authors assume full responsibility for the final product.

Abstract

Purpose

The paper extends the organizational learning framework: Structural-Functional (SF)-single-loop or Conflictual-Radical (CR)-double-loop learning to the management accounting literature. The sociological approach of organizational learning is utilized to understand those contingent factors that can explain why management accounting innovations succeed or fail in organizations.

Approach

We view learning as enhancing an organization’s strategic competitive advantage by making it better able to adopt and diffuse innovation in respond to changes in its environment in order to manage improved performance. The success of management accounting innovations is contingent upon whether its learning process involves SF-single-loop or CR-double-loop learning to adopt and diffuse process innovation.

Findings

The paper suggests that the learning strategy that the organization chooses is the reason why some management accounting innovations are more successfully adopted than others and why some innovations are easily diffused in some organizations but not in others. We propose that the sociological approaches to learning provide an alternative framework with which to better understand the adoption and diffusion of process innovations in management accounting systems.

Originality

It has become evident that management accounting researchers need to pay particular attention to an organization’s approach to adoption and diffusion of innovation strategies, particularly when they are designing and implementing process innovation programs for an organization. According to Schulz (2001), there are two interrelated stages of the learning that can shape the outcome of the innovation process in an organization. The first stage is related to the acquisition/production (adoption) of knowledge that results in gathering information, codification, and exploration. This is followed by the second stage which is the distribution or dissemination (diffusion) processes. When these two stages – adoption and diffusion – are applied within an accounting context, they address issues that are commonly associated with the successes and/or failures of management accounting innovations.

Research limitations/implications

Although innovation involves learning, the nature of the learning process does not completely describe the manner in which an innovation affects the organization. Accordingly, we suggest that the two interrelated organizational sociological dimensions of innovations processes, namely, (1) the adoption and diffusion theories of Rogers (1971 and 1995), to approach organizational learning, and (2) the SF (single loop) and CR (double loop) approaches to learning be used simultaneously to describe management accounting innovations.

Practical implications

When an innovation is implemented, it initially can be introduced as an incremental change, one that can be limited in both in its scope and its breadth of administrative changes. This means that situations which are most likely to benefit from its initiation can serve as the prototype for its adoption by the organization. If successful, this can be followed by systemic accounting innovations to instituting broader administrative changes within the existing accounting reporting and control systems.

Citation

Sisaye, S. and Birnberg, J.G. (2014), "Sociological Approaches to Organizational Learning: Applications to Process Innovations in Management Accounting Systems ^☆

Advances in Management Accounting, Forthcoming 2014. First submission October 2012; Revised submission May 2013; Accepted October 2013. This paper introduces our book titled, An Organizational Learning Approach to Process Innovations: The Extent and Scope of Diffusion and Adoption in Management Accounting Systems, Emerald Studies in Managerial and Financial Accounting, Volume 24, 2012 (Sisaye & Birnberg, 2012). We are very grateful for the continued editorial assistance and support that we have received from the editors: Marc J. Epstein and John Y. Lee over the years. We have benefited from the comments of the two external reviewers in preparing the manuscript for publication. The authors assume full responsibility for the final product.

", Advances in Management Accounting (Advances in Management Accounting, Vol. 23), Emerald Group Publishing Limited, Leeds, pp. 1-43. https://doi.org/10.1108/S1474-787120140000023001