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Accounting for quality and improved organizational performance has recently received attention in management control research. However, the extent to which process innovation changes have been integrated into management control research is limited. This paper contributes to that integration by drawing from institutional adaptive theory of organizational change and process innovation strategies. The paper utilizes a 2 by 2 contingency table that uses two factors: environmental conditions and organizational change/learning strategies, to build a process innovation framework. A combination of these two factors yields four process innovation strategies: mechanistic, organic, organizational development (OD) and organizational transformation (OT).

The four process innovation typologies are applied to characterize innovations in accounting such as activity based costing (ABC). ABC has been discussed as a multi-phased innovation process that provides an environment where both the initiation and the implementation of accounting change can occur. Technical innovation can be successfully initiated as organic innovation that unfolds in a decentralized organization and requires radical change and double loop learning. Implementation occurs best as a mechanistic innovation in a hierarchical organization and involving incremental change and single loop learning. The paper concludes that if ABC is integrated into an OD or OT intervention strategy, the technical and administrative innovation aspects of ABC can be utilized to manage the organization’s operating activities.

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.

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.

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.

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.

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.

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.

The purpose of this paper is to examine the mediating effect of intellectual capital (IC), management accounting information systems, internal process performance and customer performance (CP) on the relationship of strategies with financial performance (FP).

The population in this research was medium and large manufacturing company business units in Java. The business unit as the unit of analysis in this research is part of the organization that: is responsible for the production and marketing of a product or set of products; is formed by product type; has its own competitors which are different from competitors of other business units or divisions within a parent company; and has a manager who is responsible and has authority over the planning and implementation of strategies to achieve the specified profit target.

An innovation strategy that includes product innovation, process innovation and technology has an impact on FP if there is a good internal process performance, reliable management accounting information system and good CP. The internal process performance, which includes operations management processes, customer management processes, innovation processes and regulatory and social processes, optimizes the relationship of the strategy with FP. In this study, IC does not affect CP and internal process performance, nor does the management accounting information system affect FP. However, information systems affect FP through internal process performance and CP.

The originalities of this study are: the use of the continuous innovation strategy in an integrated manner between product innovation and process and information technology – this has never been conducted by other researchers, especially in Indonesia; the use of IC, management accounting information systems, internal process performance and CP as mediating variables; the use of an integrative approach by including variables of IC, management accounting information systems and non-FP as contextual variables related to contingency approaches that have never been conducted in previous research; the modeling of new related concepts with the one developed in the balanced scorecard; and using single mediating and multiple mediating on the influence of sustainable innovation strategies on FP.

The purpose of this paper is to develop a contingency framework that allows researchers to classify and study management accounting innovation within the context of the literature on the sociology of diffusion and adoption.

The process of innovation in organizations involves two stages: the stages of diffusion and adoption along two dimensions of extent: technical and administrative, and scope: autonomous and systemic. A combination of these two dimensions yields four types of accounting innovations: mechanistic, organic, organizational development, and organizational transformation. Management accounting innovations has been studied using these four innovation typologies.

The paper suggests that management accounting researchers pay particular attention to an organization's approach to diffusion and adoption strategies of innovation, particularly, the extent and scope dimensions when designing and implementing process innovation programs.

The innovation contingency framework developed in this paper facilitates the analysis of two important research questions. First, why have some innovations been readily accepted while other, apparently similar proposed innovations have not? Second, why has a particular innovation succeeded in some firms and failed in others?

The subject of accounting innovations and change are important to managers. Accounting innovations as administrative and technical innovations are intertwined in performance evaluation as well as compensation systems. Accordingly, they are resisted.

The paper's contribution is in the advancement of sociological theories in behavioral managerial accounting. The paper develops a process innovation framework that integrates organizational sociological research in process innovations, particularly in diffusion research.

Analyze the importance of sustainable innovation strategy applied in manufacturing companies in Indonesia which affects the company's financial performance through several mediating variables.

The population in this research was medium and large manufacturing company business units in East Java. Business units are part of a company considered as the profit center. The business unit as the unit of analysis in this research is part of the organization that: (1) is responsible for the production and marketing of a product or set of products; (2) is formed by product type; (3) has its own competitors which are different from competitors of other business units or divisions within a parent company; (4) has a manager who is responsible and has authority over the planning and implementation of strategies to achieve the specified profit target.

Innovation strategy has a significant effect on financial performance. Human capital does not significantly mediate the relationship between innovation strategy and financial performance. Capital performance and internal performance do not mediate the relationship between innovation strategy and financial performance. Management accounting information system does not mediate the relationship between innovation strategy and financial performance. Internal process performance mediates the relationship between innovation strategy and financial performance. Management accounting information system and internal process performance mediate the relationship between innovation strategy and financial performance.

The difference in findings confirms that this research needs to be conducted. On the other hand, there is no research that has comprehensively tested the mediating effects of Human Capital and Management Accounting Information System in the relationship between Innovation Strategy and Internal Process Performance and the Impact on Corporate Financial Performance. The originality of this research can be seen in the use of contingency theory which narrows the gap between the industrial organization (I/O) paradigm and the resource-based view (RBV) regarding competitive advantage and performance. Specifically, this research introduces innovation strategy, human capital, management accounting information system, and internal business process performance as the contingency factors that affect financial performance. Second, empirically, this research tries to reduce the gap in empirical research by offering new research model and new research establishment at the level of strategic business units (SBU) in manufacturing companies in East Java. This research is expected to be useful for policy decision making, especially for managers who want to improve strategic business unit's financial performance.

The purpose of this paper is to apply the organizational learning framework to the management accounting literature to better understand why management accounting innovations succeed or fail in organizations.

A theoretical framework integrating diffusion and organization learning theories is developed. Diffusion theory is used to describe the process whereby the innovation is implemented. Argyris' and Argyris and Schon's theory of organizational learning is used to describe the type of learning – single loop or double loop – required by the innovation. Finally, the works of Attewell, and of Schulz relating to organizational learning, and of Rogers and of Sandberg relating to adoption and diffusion theories, were utilized to identify and understand the potential pitfalls faced by managements implementing an accounting innovation.

The paper advances the notion that an organization's approach to learning and innovation should be of interest to management accounting researchers. The single‐loop (incremental/organizational development (OD)) and the double‐loop (radical/organizational transformation (OT)) learning influences the adoption (stage one) and diffusion (stage two) strategies that are appropriate for the design and implementation of management accounting innovations.

The paper makes an important contribution to the behavioral accounting literature by integrating sociological diffusion and organizational learning behavior literatures and relating them to management accounting research.

This paper develops and tests a descriptive model of management accounting system choice through an empirical analysis of the adoption of innovative cost accounting systems in not-for-profit hospitals. The logistic regression analysis indicates that management accounting system design is impacted by organi zational objectives, technological complexity, and other features of the organizational control system. Descriptive statistics indicate limited use of management accounting techniques common in manufacturing firms, such as standard costing and variance analysis. A cross-lagged model suggests that implementation of an innovative management accounting system may be causally linked to decreasing operating costs.

The mechanistic-organic assumptions of SF address those organizational factors related to structural arrangements, contextual factors, job-task work activities, and human resources management policies. Organizations adopt structures and procedures in search of legitimacy and institutionalization (Riebero & Scapens, 2006, p. 96). Structures manifest themselves in centralized (mechanistic) and/or decentralized (organic) forms. These structures can be loose or tightly controlled; they can involve independent or interdependent tasks. These conditions have a direct impact on the operation of management information and control systems that will, in turn, impact organizational learning and process innovations, which, ultimately, affects organizational performance.

Wonders whether companies actually have employees best interests at heart across physical, mental and spiritual spheres. Posits that most organizations ignore their workforce – not even, in many cases, describing workers as assets! Describes many studies to back up this claim in theis work based on the 2002 Employment Research Unit Annual Conference, in Cardiff, Wales.

The paper provides a research framework for analyzing CSR issues and suggests knowledge gaps that can be addressed by managerial accounting researchers.

The paper draws on frameworks introduced by Epstein (2008), Aguinis and Glavas (2012), and Hahn, Figge, Pinkse, and Preuss (2010).

Despite the potential tension between managing corporate social responsibility (CSR) performance and corporate financial performance, researchers have generally established a positive relationship between the two. However, the underlying mechanisms or processes linking CSR efforts to financial performance are not well understood. Managerial accounting researchers can help fill the knowledge gap on linkages between processes, performance measures, and incentives in achieving CSR goals. A particularly important area of potential research is how firms motivate creativity, both individually and collectively, to integrate CSR initiatives into firm processes.

The paper provides a framework for researchers starting out at the intersection of management accounting and CSR.