Adoption of management accounting innovations in the Kenyan Manufacturing Industry
Otieno, Ivy Achieng
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The purpose of this study was to investigate the adoption of management accounting innovations in the Kenyan manufacturing industry. The study was grounded on three objectives; to determine the techniques of management accounting innovations adopted in the Kenyan Manufacturing Industry, to determine the extent of adoption of management accounting innovations in the Kenyan Manufacturing Industry, to establish the determinant factors in the process of adopting management accounting innovations in the Kenyan Manufacturing Industry. The study adopted both descriptive and explanatory research designs while targeting all the 25 manufacturing companies registered with the NSE. Questionnaires and interview guides were used as instruments of collecting both qualitative and quantitative data. Descriptive analysis method was deployed in carrying out data analysis whereas inferential analysis; regression and correlational analyses were applied to establish the nature of relationship between the variables. The results of the findings indicate that the recently developed MAis are less often used compared to the traditional techniques. The findings also depicted that the extent of adoption for the recently developed MAis is comparatively lower than other traditional techniques such as budgeting for planning and controlling costs. The companies also experience several challenges including high costs involved in adopting MAis and insufficient information on the MAis. The results also indicated that the determinant factors in the adoption of MAl include type of information to be captured, foreseen benefits of the innovations, nature of the business, availability of resources and initial cost to be incuned on the adopted innovation. The study established that the benefits of adoption of MAis are improved organisational operation efficiency including quality information and business response, better response within the sector' business environn1ent, improved organization's accountability and enhanced timeliness in reporting. The study concluded that techniques of MAl and benefits of diffusion of MAis strongly correlate with the extent of adoption of MAis while challenges of diffusion of MAis mildly correlates with the extent of adoption of MAis. The study further established that determinant factors in the diffusion of MAis has a weak correlation with the extent of adoption of MAis. The study recommends that the management of the various organisations should support the process of diffusing the MAl while the innovators should seek to provide enough information on the innovations and also establish good interactions with the adopters of the inventions. The findings of this study enhance the understanding of adoption of MAis in the Kenyan manufacturing industry hence providing managers and policyholders with relevant information that facilitate the development of strategies, regulations, guidelines and policies in relation to adoption MAis. The results of the study also aid further research on other aspects of MAl through offering reference to other researchers while also enhancing the contingency, institutional and diffusion of innovation theories.