THE IMPACT OF AMT FIRM CHARACTERISTICS ON INNOVATIVE COSTING TECHNIQUES AND NON-FINANCIAL MEASURES OF PERFORMANCES

This chapter proposes a contingency model that examines the most relevant contingent variables for understanding the factors that explain innovative costing techniques in a sample of firms investing in advanced manufacturing technologies (AMT firms). Furthermore, the aim of this study was also to ascertain whether AMT firms use significantly innovative managerial practices (IMPs). The chapter uses material from a survey investigation and interviews with financial directors and the survey was conducted using a sample of AMT firms selected from an Italian industry. The method differs from previous studies in that it considers the relationship between a relevant contingency variable of AMT firms (i.e. the levels of integration, but also environmental uncertainty and size) and various innovative costing, a relationship that has not been previously explored. The research was developed from the relevant literature. The results indicate that there is no association between innovative costing and AMT firms in general, however the findings show that activity-based costing (ABC) is positively associated with fully integrated AMT firms. Large AMT firms have the highest percentage of innovative costing usage, such as ABC and strategic costing (SC). The relationship between AMT firms that perceive a high degree of environmental uncertainty and innovative costing was supported by the data in case of strategic dimension (target costing (TC) and life cycle costing (LCC)). Expectations of a relationship between AMT firms and IMPs, such as just-in-time (JIT), total quality management (TQM) and activity-based management (ABM), were not supported by the data. We recognise that specific research limitations might reduce their generalisation, especially the number of statistical observations.