Strategic Benefits of Integrating the Managerial Accounting Function With Supply Chain Management

• Date: 01 March 2016
• Author: Carol E. Vann
• DOI: http://doi.org/10.1002/jcaf.22138
• Published date: 01 March 2016

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© 2016 Wiley Periodicals, Inc.

Published online in Wiley Online Library (wileyonlinelibrary.com).

DOI 10.1002/jcaf.22138

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Strategic Benefits of Integrating

the Managerial Accounting Function

With Supply Chain Management

Carol E. Vann

INTRODUCTION

In the past,

companies focused

on their internal

processes of their

company to meet

their strategic goals

and to control costs.

Although suppliers

and customers played

important roles in

the company’s suc-

cess or failure by

providing the materi-

als or services needed

for its products

and by purchas-

ing the final prod-

uct, private information was

not readily shared between

the company, suppliers, and

customers. However, as the

business environment became

more uncertain due to rapidly

changing technologies and

increased global competition,

these business models began

to be less effective. The con-

cept of supply chains where

suppliers and customers are

viewed as partners became

popular in order to deal with

challenges presented by the

evolving business environment

and to remain competitive and

profitable. In this new busi-

ness model, the internal value

chain was expanded to include

entities outside the company.

These entities (companies and

individuals) began to pursue

relationships with each other

whereby they shared

information and

ideas in order to

better meet the needs

of the customers.

Establishing

partnerships with

the members of the

supply chain from

the initial supplier

of materials and/or

services through the

final consumer has,

in most cases, led to

more timely product

development, effi-

ciency and quality

improvements, more

effective cost control,

and performance gains for the

respective companies. Eventu-

ally, companies incorporated

the managerial accounting

function with supply chain

management (SCM) to achieve

even greater efficiency and

profitability.

Supply chain management

decisions, however, are not

always beneficial for the com-

pany in the long term if they

The importance of supply chain management has

increased over time as a result of more intense

global competition, shorter product life, and rap-

idly changing technologies. This study examines

recent academic research to offer practitioners

insight into the benefits of incorporating three-

dimensional concurrent engineering and strategic

cost management into the design of their supply

chain. It has been shown that this integration can

enable companies to achieve their strategic goals

of improving their organization’s operational and

financial performance, reducing costs, increasing

customer value and satisfaction, and maintaining

a competitive advantage in the marketplace.

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