Literature review on Innovative Control Systems to Drive Strategic Renewal
In the 1970s, the world recession caused by the oil crises created opportunity for US to produce the higher costs and lower quality products for worldwide demand. However, Japanese manufacturers implemented the Toyota production system and entered into the market with low priced and high quality products at the same time and brought the concepts of continuous improvement, customer orientation and employee empowerment (Albright and Lam, 2006; Nyamori et al., 2001). In 1980s, privatisation and deregulation affected the competition in service industry and the organisations started focus on management accounting (Drury, 2004).
Moreover, globalisation increase the competition in the market followed by the innovation of technology caused the production process shifted from labour intensive to capital intensive (Kaplan, 1989). Furthermore, development of technology also changed the management accounting systems and the way of collecting and processing the data (Islam and Kantor, 2005; Jackson and Starovic, 2004; Yazdifar and Tsamenyi, 2005).
Development in manufacturing and technologies of processing information kept bringing the uncertainty to the international industry in 1990s (Abdel-Kader and Luther, 2006). Besides that, in the last 3 decades, the growing knowledge-based economy caused the management accounting to be more focused on non-financial measurement of intellectual capital (Tayles et al., 2006). The main reason caused the transformation of management accounting is actually the competitiveness as it indirectly drives the innovation of other reasons while the other factors can help the companies to attain competitiveness.
2 Due to those reasons, the importance of financial performance such as profitability declined and the organisations are more focused on long-term strategy (Gupta and Gunasekaran, 2005). Toyota production system (Lean Production), which...