Article review of “organisational learning capability on the organisational use of SMA practices”

Article review of “organisational learning capability on the organisational use of SMA practices”

 

How to present this article in Harvard reference format?

Baird, K., Su, S. & Nuhu, N., 2024. The influence of organisational learning capability on the organisational use of SMA practices: The mediating role of employee creativity and empowerment. Accounting & Finance, 64(3), pp.2321–2343. https://doi.org/10.1111/acfi.13217

  

What are the key research issues the article wants to address?

The article addresses the following key research issues:

1.    Role of Organisational Learning Capability in Use of SMA Practices: The study aims to examine how organisational learning capability influences the organisational use of strategic management accounting (SMA) practices, extending the SMA and organisational learning literature.

2.    Mediating Role of Employee Behavioural Factors: It investigates the mediating roles of two individual employee-related behavioural factors – employee empowerment of SMA practices and employee creativity – in the relationship between organisational learning capability and the organisational use of SMA practices.

3.    Cross-Level Model Linking Organisational and Individual Factors: The study responds to calls for contingency-based research to develop models linking organisational-level variables (organisational learning capability) with individual outcomes (employee empowerment and creativity), which in turn affect organisational outcomes (use of SMA practices).

4.    Mechanisms of Change in SMA Adoption: It seeks to open the ‘black box’ by providing insights into the employee behavioural mechanisms through which organisational learning capability affects SMA practice use, focusing on how enhanced learning leads to empowerment and creativity among employees responsible for SMA.

These issues are addressed through surveying accountants, who are key employees involved in SMA adoption, and analyzing how their empowerment and creativity mediate the effect of organisational learning capability on SMA use in organisations.

  

Describe two main theories employed in this article.

The article primarily employs the following two main theories:

1.    Contingency Theory: The study uses contingency theory to examine the association between organisational learning capability and the organisational use of strategic management accounting (SMA) practices. Contingency theory emphasizes that organisational practices and outcomes depend on specific contextual factors and conditions. In this article, contingency theory provides a framework for understanding how organisational learning capability, as a contextual factor, influences SMA adoption and utilisation. The research also responds to calls for contingency theory to be more dynamic by exploring the mechanisms of change, specifically through employee-related mediators.

2.    Organisational Learning Theory: Organisational learning capability is central to the study, which draws on organisational learning theory to explain how organisations facilitate and enhance the acquisition, dissemination, and use of knowledge to improve performance. This theory underpins the investigation into how organisational learning capability fosters employee empowerment and creativity, which in turn affect the use of SMA practices. Organisational learning capability involves elements such as experimentation, risk-taking, dialogue, and interaction with the external environment, all of which enable knowledge development and behavioral change at the employee level.

These theories collectively support the development of a cross-level model linking organisational-level capabilities with individual employee behaviors (empowerment and creativity) that mediate the organisational use of SMA practices.

  

Highlight 2 main primary findings reported in this article.

 Two main primary findings reported in the article are:

1.    Direct and Indirect Influence of Organisational Learning Capability on the Use of SMA Practices: The study found that organisational learning capability has both a direct and an indirect effect on the organisational use of strategic management accounting (SMA) practices. The indirect effects occur through employee-related behavioral factors, specifically employee empowerment of SMA practices and employee creativity. This highlights that organisational learning capability not only directly facilitates SMA adoption but also operates through enhancing employee behaviors that support SMA implementation.

2.    Mediating Role of Employee Creativity and Empowerment: Employee creativity and empowerment significantly mediate the relationship between organisational learning capability and organisational use of SMA practices. Organisational learning capability positively influences employee creativity and empowerment, which in turn lead to higher organisational use of SMA practices. Moreover, employee empowerment of SMA practices also influences employee creativity, suggesting a sequential mediation effect where empowerment fosters creativity, ultimately improving SMA utilisation.

 

Describe 3 main claims of the article in terms of Toulmin's model of argument.

 Using Toulmin’s model of argument—which consists of Claim, Data (Evidence), and Warrant (the reasoning that connects the data to the claim)—here are three main claims from the article:

1.    Claim 1: Organisational learning capability positively influences the organisational use of SMA practices.

• Data: Survey data collected from 332 accountants in Australian organisations showed a significant association between organisational learning capability and SMA use.
• Warrant: Organisational learning capability enhances knowledge sharing, experimentation, risk-taking, communication, and participative decision making, which support the adoption and effective use of SMA practices.

2.    Claim 2: Employee empowerment of SMA practices mediates the relationship between organisational learning capability and organisational use of SMA practices.

• Data: Empirical analysis demonstrated that organisational learning capability facilitates employee empowerment (e.g., decision-making authority, collaboration, formal participation) in SMA practices, which in turn fosters greater organisational adoption of these practices.
• Warrant: Empowered employees have greater insight, authority, and motivation to adopt and implement SMA practices, thus acting as a behavioral mechanism that channels the effect of organisational learning capability into actual SMA use.

3.    Claim 3: Employee creativity also mediates the association between organisational learning capability and organisational use of SMA practices, including a sequential mediation effect via employee empowerment.

• Data: The data revealed significant positive effects of organisational learning capability on employee creativity, and employee creativity was positively associated with SMA use. Additionally, empowerment of SMA practices encourages creativity, creating a sequential pathway.
• Warrant: Creative employees generate new ideas and solutions that can enhance the strategic value of SMA practices, and when empowered, employees are more likely to express and apply their creativity to advance SMA adoption.

These claims collectively explain how organisational learning capability drives SMA use both directly and indirectly through employee behaviors, supported by the empirical findings of the study.                                                                                          

 

Describe 2 main research limitations of the study.

Two main research limitations of the study are:

1.    Sample Specificity and Generalizability: The study’s data were collected exclusively from accountants working in Australian organisations with more than 50 employees. This focus on a specific occupational group (accountants) and geographic region limits the generalizability of the findings to other employee groups, smaller organisations, or different cultural and national contexts. The study acknowledges that employees in their context refer specifically to accountants due to their involvement in SMA practices, which may not represent the broader workforce's behaviors or perspectives.

2.    Cross-sectional Research Design and Causality: The research design involved cross-sectional survey data, which restricts the ability to infer causal relationships among organisational learning capability, employee behaviours (empowerment and creativity), and organisational use of SMA practices. Although mediation analysis was conducted, the temporal ordering and causality are assumed rather than empirically demonstrated, and the possibility of reciprocal or reverse causality remains. Longitudinal or experimental studies would be needed to better establish causal mechanisms.

These limitations suggest caution in interpreting the findings and signal areas for future research to enhance robustness and applicability.