Accounting, Organizations and Society 34 (2009) 738–754

Contents lists available at ScienceDirect

Accounting, Organizations and Society

journal homepage: www.elsevier.com/locate/aos

Short and long translations: Management accounting calculations and

innovation management
Jan Mouritsen *, Allan Hansen, Carsten Ørts Hansen
Department for Operations Management, Copenhagen Business School, Solbjerg Plads 3, DK 2000 Frederiksberg, Denmark

a r t i c l e i n f o a b s t r a c t

Management accounting calculations relate innovation to the firm through translations

where both can change. Based on examples of the management of innovation from three
firms the study shows how management accounting calculations rather than describe
the properties of innovation add perspective to them mediating between innovation con-
cerns and firm-wide concerns. This mediation happens through short and long translations.
In short translations, management accounting calculations extend or reduce innovation
activities via a single calculation. In long translations innovation activities are problema-
tised via multiple calculations. When calculations challenge each other in long translations
they problematise not only what innovation should be, but also where it should be located
in time and space. In the three examples, calculations mobilised alternative propositions
about the relevance of technical artefacts and linked this to innovation strategy and sourc-
ing strategy in the firm’s inter-organisational relations. Tensions between calculations
associated with technological, organisational and environmental entities framed consider-
ations about the value of innovation to the firm strategically differently. All this happens
because management accounting calculations are partial rather than total calculations of
firms’ affairs and value.
! 2009 Elsevier Ltd. All rights reserved.

Introduction
Management accounting calculations relate innovation
activity to the firm through two types of translations; a
short translation which helps extend or reduce innovation
activities in view of an actual or a possible performance
variance; or a long translation which develops competing
contexts for innovation and impacts firms’ innovation
strategies and sourcing arrangements. This conclusion,
which will be developed and justified later, adds weight
to theories of management accounting calculations which
see them as inscriptions that produce knowledge (Robson,
1992), create visibility (Cooper, 1992), mediate between
complementary resources (Miller & O’Leary, 2007), and
identify objects and objectives to be managed (Chua,
* Corresponding author.
E-mail addresses: jm.om@cbs.dk (J. Mouritsen),
(A. Hansen), ch.om@cbs.dk (C.Ørts Hansen).
1995; Hoskin & Macve, 1986; Miller, 2001; Preston, Coo-
per, & Coombs, 1992; Vaivio, 1999). Management account-
ing calculations are related to organisational practices
either in relation to individual managers’ localised, embed-
ded decision making (e.g., Boland & Pondy, 1983; Ahrens &
Chapman, 2004,2007), or in relation to change programs
that reach deep into the organisation to manage the labour
force and transform the firm (e.g., Ezzamel, Willmott, &
Worthington, 2004; Ezzamel, Willmott, & Worthington,
2008; Miller & O’Leary, 1994). We follow these ideas but
add one nuance suggesting that management accounting
calculations are not only mobilised by others – they also
mobilise others. In this study, this means that accounting
calculations create contexts for something, and in this re-
search this something is innovation. The research question
is: how do management accounting calculations mobilise
innovation activities?
ah.om@cbs.dk The central finding, which is based on the empirical
study of relations between management accounting

0361-3682/$ - see front matter ! 2009 Elsevier Ltd. All rights reserved.
doi:10.1016/j.aos.2009.01.006
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
calculations and innovation in three firms, is that manage-
ment accounting calculations link innovation activities to
firm-wide concerns rather than describe and represent
innovation activities. The visibility, insight and knowledge
produced by management accounting calculations rarely
concern the details of innovation practices. It rarely creates
deeper knowledge about the intricacies of innovation
activities; it typically creates insight about links between
innovation and wider organisational concerns which are
mediated via short or long translations, where length re-
flects the number of elements taken into account. In short
translations innovation activities are mobilised by a single
calculation and related to a variance from a standard or
budget which will reduce or increase innovation activities
depending on whether the deviation is positive or nega-
tive. Short translations mediate between innovation activ-
ity and the costs and revenues of the firm.
Long translations have multiple calculations that create
tensions about the role of innovation. Here, calculations
challenge each other and develop organisational tensions
and dialogues beyond innovation activities. Long transla-
tions develop new possible versions not only of preferred
types of innovation activities, but also about their location
in time and space. They develop competing propositions
about the relevance of technical artefacts and link them
to innovation strategy and sourcing strategy in the firm’s
inter-organisational relations. The tensions within long
translations mobilise technological, organisational and
environmental entities by framing considerations about
the value of innovation to the firm strategically differently.
The remainder of this paper is structured as follows:
first we analyse central discussions about the role of
accounting calculations in innovation. Here, accounting
calculations are typically not accorded a constructive role,
but an emerging literature suggests a positive link between
management accounting calculations and innovation find-
ing that management accounting calculations are abun-
dant in innovative contexts. Yet, the literature is silent on
how the calculation influences elements of innovation.
Then the research strategy and methods are presented;
drawing on aspects of actor-network theory we trace rela-
tions between proposed management accounting calcula-
tions and innovation activities. The empirical section
presents three examples of translations between manage-
ment accounting calculations and innovation manage-
ment. Then the findings are discussed and finally
conclusions are provided.
Management accounting calculations and innovation
management
Often, management accounting calculations and associ-
ated management control systems have been understood to
hinder the development of innovation. The innovation
management literature usually denies a constructive influ-
ence of management control systems on product innova-
tion (Damanpour, 1991; Dougherty & Hardy, 1996;
Gerwin & Kolodny, 1992; Leonard-Barton, 1995; Tidd, Bes-
sant, & Pavitt, 1997; Verona, 1999). Formal control systems
constrain, or at best are irrelevant in, innovation and R&D
settings (Abernethy & Brownell, 1997; Birnberg, 1988;
739
Brownell, 1985; Hayes, 1977; Rockness & Shields, 1984;
Rockness & Shields, 1988). They are obstacles to creativity
and incapable of supporting innovation (Abernethy &
Stoelwinder, 1991; Amabile, Conti, Coon, Lasenby, &
Herron, 1996; Miles & Snow, 1978; Ouchi, 1977; Ouchi,
1979; Tushman & O’Reilly, 1997). Rationalisation is seen
as incompatible with the creativity required for innovation
(Burns & Stalker, 1961; Hall, 2001; Raelin, 1985).
However, increasingly it is proposed that management
control systems enable innovation (Clark & Fujimoto,
1991; Cooper & Kleinschmidt, 1987; Cooper & Slagmulder,
2004; Davila, 2000; Davila & Wouters, 2004; Hansen &
Jönsson, 2005; Ittner & Kogut, 1995; Ziger & Maidique,
1990). Management control systems can be enabling for
corporate activities (Ahrens & Chapman, 2004, 2007), and
Simon’s ‘levers of control’ framework (1987, 1990, 1991,
1994, 1995) suggests that interactive use of management
control systems stimulates innovation (Bisbe & Otley,
2004; Widener, 2007). Here, formal management control
systems can – under certain circumstances – help firms
facing rapidly changing product or market conditions. For
example, Simons (1990, p. 141) suggests that
‘‘the prototypical prospector faces strategic uncertain-
ties owing to rapidly changing product or market condi-
tions; interactive management control systems such as
planning and budgeting are used to set agendas to
debate strategy and action plans in these rapidly chang-
ing conditions. Defenders, by contrast, use planning and
budgeting less intensively [because they] operate in a
relatively stable environment, many aspects of the busi-
ness that are important in terms of current competitive
advantage are highly controllable and managers need
only focus on strategic uncertainties – often related to
product or technological changes that could undermine
current low cost positions.”
When environments are complex and dynamic firms
have management control systems which foster dialogue
and interaction about the development of products and
markets and the innovative pressure may be accommo-
dated via interactive use of management control system
(Bisbe & Otley, 2004).
Likewise, Davila (2000, p. 402) identifies uncertainty
and product strategy as drivers of management control
systems in new product development and he adds that a
broad definition of management control systems is neces-
sary to understand their role in relation to product devel-
opment (ibid., p. 404):
‘‘The study reinforces a broader definition of manage-
ment control systems to go beyond financial measures
and also include non-financial measures. . . This finding
suggests that researching management control systems
in new product development cannot be restricted to
traditional accounting measures, but needs to encom-
pass a broader set of measures. . . As the theory pre-
dicted, uncertainty and product strategy are related to
the design and use of management control systems.”
Depending on the type of uncertainty facing managers
they will use different combinations of financial and
non-financial information. Like Simons, Davila emphasises
740 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
characteristics of the situation as drivers of management
accounting calculations. Simons and Davila forcefully argue
that management accounting calculations do not hinder
innovation. Indeed, they suggest that in innovative context
there may be many more calculations than in situations
where innovation is less prevalent. They demonstrate that
many calculations exist. Yet the analysis of how a control
agenda, such as interactive use of calculations or combina-
tion of financial and non-financial information, influences
decisions about innovation activities can be usefully ex-
tended. How does a calculation make a difference?
Robson (1992) argues that accounting calculations de-
velop visibility and create organisational time and space.
He analyses how accounting mobilises distant places and
make them parts of managers’ world. Management account-
ing calculations provide a good deal of the knowledge that is
available for management (Cooper, 1992, 1997; Law, 1996).
This knowledge is an effect of procedures of inscription, i.e.,
procedures of how traces such as receipts and statistics are
put together and ends in a calculation (e.g., Briers & Chua,
2001; Chua, 1995; Miller & Rose, 1990). Focusing more on
the procedure of making a calculation than on its correspon-
dence with an underlying reality, Robson makes the man-
agement accounting calculation one proposition about the
financial affairs of the firm. So, organisation and market
may be brought forward and made visible by calculations
of, e.g., of revenues and development in profitability (Hines,
1988; Quattrone & Hopper, 2005), and the calculations im-
pose an agenda requiring a response (Miller, 2001). These
authors emphasise that a management accounting calcula-
tion is an inscription which develops visibility by
‘‘stating what belongs to the past, and of what the
future consists, by defining what comes before and
what comes after, by building up balanced sheets, by
drawing up chronologies, it imposes its own space
and time. It defines space and its organisation, sizes
and their measures, values and standards, the stakes
and rules of the game” (Callon & Latour, 1981, p. 286).
By making things visible, the calculation prioritises
elements to be accounted for. Calculations influence
how ‘‘different spaces and different times may be pro-
duced inside the networks built to mobilise, cumulate
and recombine the world” (Latour, 1987). The calculation
is an actor. According to Latour ‘‘any thing that modif[ies]
a state of affairs by making a difference is an actor” (La-
tour, 2005, p. 71). No actor acts alone therefore the calcu-
lation is always part of a larger collective that acts
together with it. Actors are ‘‘made to act by many others”
(Latour, 2005, p. 46).
Approach and research strategy
The empirical domain is three small and medium sized
companies. We interviewed 20–25 managers in each firm
each taking between 1.5 and 3 h. We explained managers
that we were interested in their efforts to control and ac-
count for innovation. We had a semi-structured question-
naire, but often the dialogue would quickly develop its
own momentum. We did not focus on the firms as ethno-
graphic (or cultural) entities, as Yin (1994) would recom-
mend, but rather on episodes of translation between
management accounting calculations and concerns for
technology. Our interviews were reflexive (Alvesson,
2003) or analytical (Kreiner & Mouritsen, 2005) which
acknowledges that our theoretical issues, which were pre-
sented to mangers explicitly, were the introduction to data
collection. This is not a claim to have researched three firms
in their totalities; the claim is to have researched how man-
agement calculations are related to decisions about innova-
tion (technology). Management accounting calculations are
likely used for many other purposes as well.
The three firms not only claimed to be innovative and
could all be characterised as ‘HighTech’ companies. They
also all produced measurement technologies and systems
used in different industries but there were commonalities
in product technologies (such as a mechanism to receive
and record signals, a computer to manage the signals and
a screen to present the signals in a relevant form). Each
has been given a fictional name to preserve their anonym-
ity: SuitTech, HighTech and LeanTech. Through the analysis
it was possible to draw out two propositions about innova-
tion and two associated management accounting calcula-
tions in each example.
The analysis of the empirical material was organised to
identify translations between calculations and innovation
activities. Firstly, we identified propositions about causal
relationships between innovation and value creation med-
iated by calculations. We paid attention to how calculations
were accorded power to do things. Secondly, we noted how
the power attributed to calculations translated into pro-
posed effects on management of innovation activities
(reduction or extension of innovation activities). We traced
how a presentation of a calculation would propose to influ-
ence innovation activities. Thirdly, we then paid attention
to the time and space suggested to be informed by the cal-
culation and noted how changes in innovation activities
would transform into something else such as sourcing
strategies which turned out to be surprisingly important.
Last, we used Callon’s (1986) diagrammatic form to illus-
trate the movements around the calculations. His diagrams
show how entities are included in or excluded from an
explanation and they seek to identify the movement of
changing relations. Figs. 1–4, which will be presented later,
are outcomes of this analytical procedure.
Translations between management accounting
calculations and innovation activities
The empirical material was collected in three firms that all
invested in innovation and made this a priority. The concern
was not whether innovation was useful, but which innovation
should be conducted and how it should be organised. In all
firms there were many management accounting calculations
but not all were able to stand for or represent innovation. In
each of the firms certain calculations were accorded particu-
lar significance when managers accounted for innovation per-
formance. The following sections present how management
accounting calculations were mobilised to account for and
influence innovation activities.
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
Example 1: SuitTech – the role of special and customised
components in innovation
SuitTech, a small HighTech firm, produced and sold
measurement systems to R&D departments and university
laboratories whose measurement problems varied consid-
erably. Some customers measured turbulence in wind tun-
nels; others measured water-currents when designing oil-
rigs, and yet other customers measured turbulence in
flames. These different measurement situations confronted
SuitTech with demand for product innovation. Its mission
statement emphasised its ability ‘‘in providing solutions
and solving problems,” and it singled out that customers
‘‘have depended on the quality and reliability of its prod-
ucts and services to solve their problems.”
SuitTech’s measurement systems were presented as un-
ique offerings. Each product was bent tightly around the
individual customer with extreme customisation. In order
to make a unique solution with precisely customised tech-
nical functionality, sales engineers could, in cooperation
with the customer, choose from special and customised
components delivered by a broad range of suppliers or
developed and produced by SuitTech itself. Finding special
and customised components along with developing and
producing unique components internally was suggested
to be a core competence of the firm.
Mobilisation of sales performance and innovation through
specialised and customised components
To sales engineers, sales performance was an authori-
tative performance measure. The measure calculated the
actual gross revenue minus budgeted gross revenue for
each of the major technological areas quarterly. The bud-
get was set between the teams of engineers, the sales
manager and the CFO of the firm. Actual gross revenue
was an accumulated measures of all orders signed for at
given technological area in a given quarter. Thus, sales
performance was recognised in SuitTech’s accounting sys-
tem when customers signed a contract and an order was
made. Before signing the contract, customers and sales
engineers had a long and intensive dialogue about cus-
tomer needs and technical characteristics; they developed
many different propositions about the measurement
problem at hand and about its targeted performance.
Therefore, an order symbolised the end of a prolonged
process of interaction where numerous propositions were
defined and considered; the characteristics of an eventual
order could not be predicted at the outset of the process
and it was therefore its effect rather than its precondition.
The calculation, sales performance, illustrated precisely
that a long process had been ended, which was observed
by a sales engineer:
‘‘You see the results of what we do in the sales mea-
sures. A customer never makes an order before we have
had serious discussions with him or her about the mea-
surement problem. And unless we can come up with
something convincing, we do not get the order.”
Sales performance marked the end of a process of inter-
action. Together, sales engineers and customers assembled
the measurement system according to detailed require-
741
ments and specifications which were developed as part
of the process. In principle they could choose any combina-
tion of components such as optical receivers, lenses, chass-
es, lasers, etc. These could be sourced from a large network
of carefully selected suppliers. The sheer number of possi-
ble different components allowed huge flexibility in de-
sign, and made innovative solutions to the customers’
measurement problems possible:
‘‘We can easily be in situations where we need a
1.3 mm lens instead of a 1 mm lens. If we let forego
the option to choose from many different items in the
design (and only use internally produced components)
I think SuitTech will create bad customer solutions
and thereby loose competitiveness.”
Supplies of external components were used to refine
the customer’s solution and allowed SuitTech to be and
stay innovative. In SuitTech, innovation was negotiated
principally between sales engineer and customer and
when needed with the suppliers of special components.
Both were professionals and both knew the intricacies of
the technology. The process of selling, which involved
inventing the product, was time consuming. In principle,
it could go on for a long time because both sales engineer
and customer would always be able to invent or think
about new improved details. Therefore, the process of
developing an order was inspired and would not neces-
sarily stop: more time meant more detail and more quality.
How could such a process be stopped and transformed
into an order? When sales budgets were met and aspira-
tions achieved, the sales variance was modest and typically
unconnected to the process of developing and closing
orders. However, in situations where such aspirations were
not met, the sales variance transformed the network of
activities performed by sales engineers. Unfavourable
variance influenced sales engineers to redirect their efforts
from developing orders to closing orders within a short
period of time and they were thus persuaded to bracket
concerns about the products. Unfavourable variance ori-
ented them to cash flows away from leads; to budget-vari-
ances rather than to customisation; and to closing orders
more than to creating new and elegant combinations of
specialised components. Unfavourable variance recast
sales engineers’ interests and problematised the dilemmas
between SuitTech’s and customers’ needs. The sales budget
problematised the interests of the firm compared with
those of customers and suppliers. Sales performance cre-
ated the tension between customisation and closing or-
ders. It defined a strategic uncertainty about the
innovation agenda in SuitTech. When sales performance
was favourable it extended technological innovation while
when unfavourable it reduced technological innovation.
Extending translations of innovation – mobilising direct costs
Innovation was in many ways predicated on expansion
of the number of possible components that could be put
into a product. Sales performance framed sales engineers’
experimentation with complex designs that prolonged
the sales process as only ‘the best’ was tolerable. It
prevented much financial problematisation of the firm’s
innovation. A business controller noted the inferiority of
742 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
cost in accounting for the firm’s sales performance in
SuitTech:
‘‘A performance measure that is very important for our
sales engineers is sales. What I as a management
accountant miss are indicators for direct cost. We quite
often debate this. I think this omission to a large extent
comes from the way we innovate. The focus on
constructing unique measurement systems to the
individual customer and producing to order make cost
indicators less relevant... but I think that we should
start considering these things as well. It is possible to
be aware of direct costs even if we are a bunch of
innovators.”
This addition to sales performance of cost items devel-
oped a new type of tension in relation to the value of inno-
vation. The business controller contended:
‘‘It is the contribution margin and not sales that matters
when it comes to value creation. As a management
accountant I would say that it is a much more represen-
tative calculation of sales engineers’ value creation.”
The contribution margin made revenues less direct cost
visible. Such inclusion of cost in performance was pro-
posed as a more relevant concern with value creation,
but it was also challenged. The sales manager explained:
‘‘As soon as we start to use contribution margin as a per-
formance measure some would probably be tempted by
the fact that they could increase performance by reduc-
ing direct costs. That is probably good in some situation
but I think that many engineers would probably also
start to apply cheaper components and new – and less
efficient – technology in order to reduce the costs which
would be a disaster for us. We do not compete on costs.
We compete on the solution that we are able to come up
with for the customer! We sell a differentiated product –
a solution that the costumer is willing to pay for. We
should not be spending our time on reducing costs but
instead on finding the right solution.”
Sales performance motivated a strategy of tight cus-
tomisation through liberal use of externally sourced special
and customised components but lurking closely in the
background was the proposition to reduce direct costs;
through such behaviour a whole new technology strategy
that included a focus more on programmable standard
components and software would become desirable. Adapt-
able software programming and a narrower range of stan-
dard components presented an alternative to the large
variety of special components. Programmable component
development, which was an appendix to sales and not
obligatory to sales engineers, was used to create a bench-
mark for technology. The strong form of customer orienta-
tion did not favour conventional forms of planning and
control. The production manager emphasised that
‘‘Actual costs are always different from forecasts; in
particular direct costs depend upon specific measure-
ment problems that the customer has and these are
hard to forecast and there are no incentives to reduce
them for the sales engineers.”
Thus, the commitment to customisation challenged con-
trol of direct cost as well as delivery time since the supply
situation often became complex and impossible to forecast
due to the use of specialised items sourced from external
suppliers. This concern was, however, only loosely coupled
to SuitTech’s strategies as delivery time was proposed not
to be crucial to the customer.
As calculation, sales performance did not consider direct
costs. It did not propose standardisation and it did not
stress technological predictability and stability. It framed
the economics of the firm in relation to innovation activities
but it did not specify how innovation activities should be
organised because its focus was more external than internal
to innovation activities. Sales performance motivated
expansion of activities and propositions in innovation. A
sales engineer commented:
‘‘We are free to choose any special or customised com-
ponent that fulfils the customer’s need. Of course the
customer has to pay for it but we do not keep record
and set targets for these things. Reducing direct costs
is not a performance criterion. Actually, it is a bit of a
relief and it makes our job easier. It creates room for
innovation. You may say that it is critical to our
success.”
Tensions related to the omission of direct cost in the
performance measure was raised by controller who
claimed that sales engineers should mind costs and reduce
the use of the special and customised components:
‘‘I do not want to be a pessimist. I think the sales engi-
neers do a great job. But is it more the fact that they
should keep in mind that the special components costs
us actually quite a bit in terms of direct costs and time.
So why don’t we start to incorporate it in our perfor-
mance measure.”
If they had knowledge of direct cost sales engineers
would perform innovation in new ways and ask questions
about the appropriateness of special and customised com-
ponents. They would reduce the use of such components
and substitute them with programmable standard compo-
nents. The production manager explained:
‘‘There are alternatives to special components. I mean,
we can go far by programmable standard components
and by the help of software programming from our soft-
ware engineers. Programmable components can never
replace special components totally but this is another
possible technological strategy.”
Such a strategy would also affect supplier-relations the
production manager suggested:
‘‘This would also imply that we have to think about our
suppliers in a different way. Currently, we spend a lot of
resources nursing the large network of suppliers deliv-
ering customised and special components. However, if
we used programmable standard components, we
would reduce this network and the resources we con-
sume in the purchasing department significantly. It is
a strategic cost, but remember the special and custom-
ised components are beneficial to us in many ways.”
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
Sales performance privileged heterogeneity in compo-
nent selection. The visibility created by calculating costs
of special and customised components would encourage
a wholly different strategy for innovation. The alternative
would be to focus more on the components programmed
by SuitTech itself where variation was created by software
rather than by hardware:
‘‘We might challenge the way that we innovate today.
In fact, software is an alternative to the hardware deliv-
ered by suppliers.”
The tension between the two strategies was to a large
extent created by the demarcation between performance
according to sales and direct costs. Direct costs problema-
tised the use of special and customised components and
proposed to influence inter-organisational relations.
‘‘If we focus more on the components that we can pro-
gramme ourselves we might change the way that we
are innovative today. This would also affect the way
we see our suppliers. They would rather deliver a rela-
tively limited number of standard components. Now we
consider them all as one big supermarket. Lots of oppor-
tunities exist out there.”
The perspective suggested by direct costs related new
elements to the translation of innovation. It required Suit-
Tech to upgrade its internal software competences to con-
vince sales engineers about the real relevance of
standardised programmable components for customisa-
tion. This challenge was mobilised by associations made
by direct costs and contribution margin which were in
stark contrast to the ideas of components and inter-organ-
isational relationships made by sales performance.
Example 2: HighTech: the concern with technological
superiority
HighTech produced and sold measurement systems
typically to the health sector (e.g., hospitals). Like SuitTech,
also HighTech’s customers demanded high technology but
they shared industry where the measurement system had
to perform various but specific kinds of medico-technical
analyses. HighTech’s innovation aimed to develop prod-
ucts’ ability to perform all relevant medico-technical anal-
yses. Technology development pushed the boundaries of
supplied technology to the point where HighTech knew
more about possible measurement tasks than customers
or users would normally do. HighTech saw itself as a mar-
ket-driving firm where customers would buy latest tech-
nology when it was made available to them.
Mobilisations of contribution margins and innovation through
technological superiority
The product contribution margin was standard vocabu-
lary in the new product development department of High-
Tech. The contribution margin subtracted expected direct
costs from expected sales and the targets set for direct
costs as well as sales prices became a measure that coordi-
nated and motivated actions taken in each development
project. The performance measure, however, paid little
743
attention to indirect costs which was suggested to have
created a significant room for innovation. A development
engineer explained:
‘‘There is not much focus on indirect costs in our
research projects and this is fortunate because it gives
us freedom to experiment. We are not as accountable
for the resources we spend on each project as we
could be. Before I came to HighTech I worked in a
development organisation where this was always
was an issue. Here, there are many more possibilities
– and I think it is beneficial for the organisation as a
whole.”
The development engineer referred to a concern in
HighTech whether product development project managers
were to be accountable for the indirect costs of the R&D
department carried out HighTech. The concern was
whether research resources should be reflected in product
profitability or not; would it be advisable to develop a
profit margin after indirect cost or maintain the focus on
the contribution margin accounting primarily for indirect
cost? Technological innovation was important to HighTech
that had a history of high quality products. It saw itself as a
market-maker that set the de facto standards of the indus-
try. HighTech emphasised application of new technology.
The director of research and development suggested this
very clearly:
‘‘We must develop the technology. It makes no sense to
us just to copy the products from our competitors. Our
mission is to develop the new products to the market
and we have to be the leading technological firm. This
is what gives us profit.”
HighTech was committed to R&D and prided itself to be
able to see customer wants before customers were aware
of them. Product developers proposed that they knew
more about relevant uses of the measurement system than
customers and often customers simply accepted that High-
Tech’s latest product had to have better solutions than
what the customer would be able to think of. The individ-
ual product was not customised. It was standardised, but
as HighTech continuously set new standards for what a
measurement system could do, it created its own demand.
It was less a market-driven firm than a market-driving
firm, and HighTech experienced a high degree of ‘technol-
ogy elasticity’ which connected technology development
with high growth in prices and revenues. HighTech pro-
posed its extensive investment in experimentation and
R&D in their development projects as a reason for this
capability.
HighTech’s R&D organisation was separated in two: a
R&D department and a development organisation. The
R&D department carried out technology projects about
chemical fluids and electronics and was presented as a ser-
vice department for development projects. Technology
projects initiated to solve technological issues in one new
product development project could often produce knowl-
edge that could be used in a wide range of other develop-
ment projects. Individual technology projects produced
deep technological competences in chemical fluids as well
as electronics and not merely applications hereof to a
744 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
product line. The costs of R&D were not allocated to new
product development. The R&D director argued:
‘‘Many of the results we get from the technology pro-
jects are like ‘public goods.’ They can be shared by
everyone, as it is a key towards our key competitive
advantages.”
A new product development manager continued:
‘‘Often we take detours in the projects. It makes the pro-
jects much more expensive in total. But the things that
we learn provide us with the extra knowledge that is so
decisive to us if we want to keep our position on the
technological edge. Some may say that we are too care-
ful [in research] and spend too many resources in the
development projects. But we learn things that we can
use later in other projects. It is a delicate balance. But
it is a thing that I think that we are good at in
HighTech.”
HighTech’s innovation concerned learning in relation to
its technological bases in chemical fluids and electronics.
Innovation was for purposes beyond the products at hand.
The detours in technology projects created extra knowl-
edge that could be used in later projects.
New products were considered to produce additional
revenues which would by far outweigh additional direct
costs. Development engineers raised the contribution mar-
gin as a justification for complexity in product develop-
ment. Even if direct cost was part of the contributing
margin and some concern had to be mustered to manage
these costs, the contribution margin justified attention to
complex organisational development capabilities:
‘‘We are allowed to develop our key technological capa-
bilities: electronics and fluid chemicals. And cost con-
trol here is very difficult. But when it comes to direct
cost we all have a responsibility. Sometime we even
have to compromise design in order to keep direct cost
low. However, this is of less importance in regard to the
innovation lead we get from the development of our
key technological capabilities.”
Sometimes – infrequently – direct cost could compro-
mise design but generally, product innovation was driven
by experimentation with new technologies and large in-
house development projects. Concerns with efficiency in
production processes were in large part exported to sub-
contractors, as suggested by the purchasing manager:
‘‘In our contracts we promise, e.g., to pay for a number
of spools but we will only cover the direct cost and not
any profits. If we need less that the number of spools
we only have to pay for the specific and direct cost of
the items. So, the subcontractor does not suffer a direct
loss but neither does he gain any profit. For example,
we do not pay for the copper-wire of the spool. It can
be used for other customers. We will only cover the
spool.”
Product development was concerned with revenues and
production with cost. Inter-organisational relations mod-
elled this difference.
Extending translations of innovations – mobilising indirect
cost
From time to time frustration about the cost conscious-
ness of the R&D department was aired. Controllers sug-
gested that they start focusing on the resources that
product development project consumed in the R&D
department. It seemed that product development projects
initiated many activities and incurred significant costs.
One controller stated: ‘‘It is as if you can get technological
advice for free.”
One way to direct more attention towards the cost-con-
sequences of technology development was to allocate the
costs of the technology projects of the R&D department
to the new development projects of the development
department. Different types of cost drivers were suggested,
e.g., number of requests made to the R&D department, or
man hours in the R&D department traceable to individual
new product development projects. The requested labora-
tory tests, experiments, etc. were central to solve the tech-
nological problems that emerged during the new product
development projects. This would make certain costs of
R&D visible for new product development managers who
could then economise R&D activities. This would have
important consequences as a controller argued:
‘‘To include a strict focus on indirect cost in our perfor-
mance measure would be to introduce an entirely new
idea about our business. Nevertheless, I think it is cru-
cial that we do this.”
Costing would problematise technology projects and new
product development managers would ask questions about
HighTech’s knowledge banks and look for technological solu-
tions elsewhere. A development engineer commented:
‘‘Currently, we do not use suppliers much when it
comes to our technology development. But it is defi-
nitely an option that we should consider in order to
become more cost efficient in our development pro-
cesses. And if we start costing technology requests
things will change.”
In particular in the area of chemical fluids possibilities
for finding external support, and external partners were
considered to be promising while for electronics this
would be difficult. This was noteworthy, because techno-
logical development at HighTech was largely considered
a combination of capabilities in electronics and chemical
fluids.
‘‘We have unique capabilities in HighTech that combine
electronics and chemical fluids. We cannot get that
from the outside. They are too specialised.”
The possible external sourcing of innovation in fluids
suggested that relations between the two technological
areas were to be cultivated in new ways and the R&D
department’s technological capabilities would change and
perhaps even diminish. Costing technology projects would
focus too narrowly and hinder corporate-wide value crea-
tion the director of R&D argued:
‘‘I am sceptical towards the idea of costing our technol-
ogy activities. Technology development is something
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
that emerges gradually and it may involve external
partners. When we start costing one alternative [i.e.,
the internal technology requests], we should also think
about the cost of the other alternative [i.e., external
technology requests]. But I am not sure what the ‘real
costs’ for HighTech are if we start sub-contracting tech-
nology development.”
The suggested ‘real costs’ were different from account-
ing costs. In particular he was concerned whether the con-
nections between chemical fluids and electronics could be
upheld in a situation where, because of costing, the focus
would be on narrow product line effects rather than corpo-
rate-wide effects across time and space.
Example 3: LeanTech: the challenge of hardware modules and
software programs
Aiming to develop, produce and market high quality
products for audio and video transmission, LeanTech had
developed a customer base across telecommunication
companies and radio- and television stations all over the
world. The past 5 years’ sharp growth in revenues was ex-
plained by the firm’s innovation activities. All LeanTech’s
products were customised and historically one central
challenge had been to integrate software and hardware
in a connected offer to the single, individualised customer.
Through design and sales work its development- and sales-
efforts had focused on expanding markets through cus-
tomisation and a flexible product program. The resulting
growth and expansion had made LeanTech outsource a
large part of its production capacity to selected suppliers
that had invested in advanced production technology. In
this inter-organisational relation an open book arrange-
ment had provided time and cost information about the
productions processes of the subcontractors.
Mobilisation of activity-based costing and innovation through
sharing components, modularisation and digitalisation
Design for manufacturability was considered an ele-
ment in LeanTech’s competitive success and use of com-
mon component for modularisation and use digital and
software solutions to customisation problems in product
innovation made manufacturing effective. Together these
elements problematised the relationship between hard-
ware and software components in innovation activities.
An activity-based costing calculation visualised eco-
nomic effects of complexity of engineers’ design for manu-
facturability initiatives. Historically, designers had paid
attention primarily to direct cost, but the activity-based
costing calculation focused differently:
‘‘The number of set-up had grown by more than 150%
and the machines do not run full time and we had too
much waste in process time. To meet the market condi-
tions we simply have to enable the use of common
components that can be used within and across
modules.”
This imperative to use common components challenged
designers because the implication was to reduce number
of components.
745
‘‘We were confronted with very high resistance from
the development engineers when we started to talk
about preferred types. In the development department,
they have lots of technical arguments for using many
different components but with the open book, we could
show the time- and cost-consequences of using many
different components. As a result, we have been able
to make the development engineers reconsider the
design and perform some creativity in their design work
to reduce the variation of components.”
A large number of different components proposed many
set-up operations in the production process, machines had
to be stopped and the labour force had to switch manually
between types of components thus increasing time con-
sumption and cost. Information about set-up-time and
mounting costs in the production process motivated a
reduction in component selection from 15,000 to 5000
components. Focusing on process- and production-aspects
the role of engineer’s innovation was to reduce technolog-
ical features and components of the products. And in addi-
tion to sharing components yet another activity –
modularisation – was proposed as a way to improve the
manufacturability of the product. The logistics manager
explained:
‘‘By modularisation we pack more potential functional-
ities into fewer modules and thereby get a fast reaction
to customer orders and eliminate non-value-added
time. The market condition is that we have to produce
as quickly as possible, and by being production innova-
tive we can produce everything within 2–3 weeks.”
Modularisation developed a limited number of possible
product configurations which would make the production
and assembly process more predictable. In particular, the
concern with modularisation opened a new innovation
ambition where the distinction between software and
hardware gained new significance.
Historically, LeanTech was concerned with designing
and assembling analogue devices but modularisation
pushed customisation into digitalisation. Hardware and
software could be distinguished and introduce a principle
of technology development and production taking into
consideration predictability in production and creativity
in development. Software programming could provide
innovation for customers; various types of software could
be implemented on largely the same hardware platform.
Customisation could be a question of digitalisation (soft-
ware) that could quickly be configured according to cus-
tomer needs; and the development work and supplies of
software modules could be outsourced more freely to a
pool of independent software suppliers in LeanTech’s sup-
ply chain.
Activity-based costing dramatised certain conse-
quences of digital rather than analogue technology related
to design for manufacturability, as explained by the logis-
tics manager:
‘‘There is simply a potential in software that we have to
exploit. If we do this we can increase our productivity
and we can deliver very quickly. In principle, we would
be able to deliver within just a few weeks irrespective of
746 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
what the customer wants because our production is
geared towards it. It does create a set of advantages to
orient ourselves more to software; we can see that from
our accounting statements.”
Activity-based costing expanded the use of digital soft-
ware solutions and technology because it presented ana-
logue solutions as costly compared with the digital
solutions.
Translation of innovation mobilising cost of capital
Yet the activity-based costing calculation could be
challenged by its disregard for capital costs and depre-
ciation that accrued from three types of events: increase
in the average cost per unit on inventory, increase in
waiting time for critical components, and increase in R&D
costs.
Firstly, the value of inventoried components and mod-
ules increased since, although reduced in total numbers
due to digitalisation and modularisation, the average cost
per unit increased. Since all modules and components
had to be combinable with all other components and mod-
ules, they had to have more capabilities and functions. In
software, suppliers had to put new resources into pre-pro-
gramming the software of modules and in hardware a
broader variety of functions required more expensive com-
ponents. Secondly, some of the components were critical
components that could be difficult to source and unex-
pected waiting time could occur. This risk was partly re-
lated to critical components being so special that only a
small number of suppliers would be able to deliver them,
or as the logistic manager explained:
‘‘Of course the hardware modules we now produce
result in more expensive inventories and if for example
Motorola designs a new product and use some of the
same components as us it also creates extra costs in
sourcing and delays – but we are not making any calcu-
lations on those costs.”
Such increase in inventory costs and risk of waiting
time in the supply of these components, due in part to
new surprising competitors, were not taken into account
by activity-based costing, and inventory cost was suddenly
a challenge. In some situations, modularisation and digita-
lisation could increase cost.
Thirdly, it was cumbersome to make components plug-
and-play because they were changed over time and more
recent components had to integrate with older compo-
nents. For example, software applications were not only
designed by different software-programmers but also at
different periods of time by different project teams at dif-
ferent suppliers, and therefore a substantial amount of cus-
tomisation work was needed in LeanTech. One process of
additional customisation concerned the challenge of
changing needs; another was a result of the number of
changes that were made. Both increased the workload of
changes to software, as it was explained:
‘‘Often there is already a long history of patches and
bilateral interfaces resulting in spaghetti of intercon-
nected applications, which is time consuming and a
expensive to maintain. But this is a discussion whether
these costs relate to re-engineering cost of the product
portfolio or if they are development costs that also
relates to future products.”
Software tended to grow bigger and become more com-
plex because the easiest way to add a new feature or fit
two or more functionalities and packages was to add a
new code. At the same time the aging of the software pack-
ages fastened and then it became increasingly complicated
to make it work with other packages. As a consequence the
time when new software had to be developed was moved
ahead. This, together with the fact that the modularisation
had postponed the product differentiation to a point closer
to the customer, put pressure on the programmers in Lean-
Tech to add new features quickly for connecting different
software packages.
Because of postponed customisation the priority of soft-
ware work was often to make customisation work and de-
liver to the customer. Making documentation and review
of changes and new features were not prioritised. The re-
sult was that a single delivery could exist in different ver-
sions, each with subtly different structures and based on
slightly different design concepts and assumptions. To
avoid this and accumulate the specific knowledge that fu-
ture deliveries could benefit from, changes and new fea-
tures had to be studied and documented. A team of
software engineers would review the codes in different
versions and the differences recorded and then agree on
the proper structure that all future changes had to be based
on. This made LeanTech suggest that software changes
were costly and that future changes could only be designed
consistently if the programmers’ work was based on prop-
er documentation of the design and code. Not doing so
would reduce the durability of software. In other words,
the frequent changes speeded up the aging of the software
and the work to review and document became more diffi-
cult and time consuming as the size of the software in-
creased. The logistics manager explained:
‘‘Our software packages are growing bigger and this
weight gain is caused by our fragmented supply of soft-
ware from internal and external programmers. In most
of our work on software we don’t know the original
design concept and the changes we make will be incon-
sistent with the original concept; in fact they will
degrade the original concept and speed up the aging
of the software, and software that has been repeatedly
modified in this way becomes substantially more
expensive to change and update.”
Complexity increased investments in R&D activities
which increased depreciation charges by what was sug-
gested to be 50–60%.
Concerns with cost of capital and depreciation would
not only economise R&D but also encourage its substitu-
tion towards larger, standardised software packages which
in turn would impact inter-organisational relations. In-
stead of several suppliers of software the innovation
potentially could be based on market standards from major
suppliers instead of own design and programming and
externally delivered software packages. The logistics man-
ager explained:
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
‘‘We have the option to use software suppliers that offer
a broad variety of functionalities in one integrated soft-
ware package with standard interfaces. Our R&D activi-
ties should not be reinventing the wheel. By substitute
many of our current software packages with larger and
well-designed software packages we can slow the aging
of our software and minimise the modifications and
documentations work we need to make ourselves.”
By using standardised software packages with more
functionality LeanTech’s programmers could meet specific
customer needs by adding switches and create systems
that appeared to be different by various functionalities
but were only small variations on one basic software pack-
age. The software package would last longer before modi-
fications were needed and its maintenance costs would be
much lower. The perspective suggested by capital cost and
depreciation charges required LeanTech to upgrade the use
of external software suppliers to fewer, large suppliers
with standardised software packages.
Innovation, inter-organisational relations and
management accounting calculations
Short and long translations
The main observation from the empirical account is that
management accounting calculations do not calculate
innovation activities per se but they mediate it. They hardly
make the innovation more transparent because they do not
model it; rather they mediate between innovation activities
and firm-wide concerns and influence the intensity and
direction of innovation activities. Management accounting
calculations add a new perspective to innovation activities.
This happens in short translations where innovation
activities are related to revenues, contribution margins
and ABC margins, or in larger translations where innovation
activities are linked with sourcing strategies and changes in
the competencies of firms through competing calculations.
Management accounting calculations rarely become
meaningful and powerful by an appeal to their definitional
correctness but only by connections with concerns devel-
oped when they participate in mediating multiple actual
and potential intra- and inter-organisational spaces and
times. Table 1 presents and recounts the systems of innova-
tion at stake in the three examples.
Table 1 shows that the management accounting calcu-
lation speaks for much more than it describes. The surprise
arising from the three examples is that the management
accounting calculation is able to problematise not only
innovation activities but also central strategic properties
of the firm such as its boundaries and capabilities.
The short translation
The primary quality of management accounting calcula-
tions in relation to innovation activities is hardly that they
describe innovation activities and make them increasingly
transparent. Sales performance is not the same as choices
about components in SuitTech, but it extends the probabil-
ity that sales engineers will use external components. Con-
tribution margin is not the same as electronic components
747
and chemical fluids, but it extends development engineers’
experimentation in HighTech. An ABC margin is not the
same as complex components in LeanTech but it helps
sales engineers to be interested in a limited set of preferred
components.
The short translation links the innovation to the firm by
problematising when the innovation activity is in excess
and has departed from its contribution to making the firm
viable. In SuitTech, sales performance only intervenes when
there is a shortfall which happens when sales engineers in-
vest excessive time in assembling a customised product.
When sales variance is unfavourable, attention is directed
to finalise orders rather than to produce leads. There is a lim-
it to the time a sales engineer can spend combining compo-
nents into a product. Sales performance re-frames sales
engineers’ attention towards closing orders when it is in
jeopardy. Sales performance thus translates a complex ques-
tion of technology into a simple question of time.
A parallel movement can be found in HighTech where
the contribution margin justifies new technology in inno-
vation projects and thus encourages developers to experi-
ment. The contribution margin helps to explain whether
in fact R&D is able to translate into increasing prices far be-
yond the limited direct cost added from innovation. The
R&D activity has to develop a market response in demand
and in price increase. There is a constraint to innovation,
however, as the technology has to have applicability in
an existing product range. While the contribution margin
expands innovation by emphasising R&D innovation as a
general drive towards increasing prices, it also reduces
innovation by insisting that technology development, over
a time period, be integrated with technological capabilities
of existing product ranges.
In LeanTech the short ABC calculation reduces the num-
ber of components that sales people can muster and use in
a particular product thus reducing the elements in innova-
tion arrangement. The calculation also increases the use of
more powerful components thus substituting analogue
solutions by digital solutions because it presents costs of
flexibility.
These three examples of short translations illustrate
how a management accounting calculation can work on
innovation even if it does not directly represent innovation
activities. There is an indirect link between management
accounting calculations and specific innovation activities,
which starts from adding perspective and context to inno-
vation. It stipulates a context for innovation that requires it
to be profitable.
Thus, as has been proposed also by others (e.g., Ahrens &
Chapman, 2004, 2007; Boland & Pondy, 1983) management
accounting calculations do influence situated decisions and
managers do use such information in managing R&D pro-
jects (Nixon, 1998). Yet, many decisions in innovation are
interesting not only in R&D settings since their effects
spread to manufacturing and sales and therefore, manage-
ment accounting calculations help to make the effects of
innovation economic (Davila & Wouters, 2004; Hansen &
Jönsson, 2005; Jönsson & Grönlund, 1988). The usefulness
of management accounting calculations is paradoxical be-
cause they are not inherently connected to the activities
they help organise. In all examples, the calculation requires

Table 1
Translations of innovation management by management accounting calculations in three examples<!Query id="Q5" desc="Please check the column headings in Table 1." /–>.
Innovators
Dominant calculation
Short translations Reduction/extensions of
innovation
Materialisations of the
innovative practice
Long translations Innovation strategy
Inter-organisational
relations
Competing calculation
Substituting innovation
element
Alternative innovation
strategy
Alternative inter-
organisational relations
SuitTech
Sales engineers
Sales
Sales performance focuses on orders
closed and contracts signed. It omits
direct costs and extends innovation
by expanding types of available
components. Yet, when sales variance
is unfavourable it reduces innovation
and motivates closing orders quickly
Combinations of special and
customised components sourced
from anywhere
Innovation concerns product
variation vis-à-vis customer
requirements. Through different
combinations of special and
customised components sales
engineers search for distinct
solutions fulfilling individual
customer needs. Innovation adjusts
the product through combinations of
physical entities
Suppliers play a significant role in
delivering the wide range
components to be drawn in as needed
in combinative innovation
Direct costs/contribution margin
(costs of customisation)
Programmable standard components
Innovation created by software
engineers
Innovation from the inside
Arm’s length relationship with
suppliers of standard components
HighTech
Development engineers
Contribution margin
Contribution margin visualises increasing difference
between steep revenue effects and moderate direct cost
effects of new technology and justifies indirect costs of
experimentation (with electronics and chemical fluids).
It expands innovation by protecting technology
experimentation but reduces it by insisting that
technology has to fit an existing product program when
unfavourable contribution margin variance occurs
Electronics and chemical fluids mobilised in technology
development
Innovation concerns development of new products
setting industry standards and create new customer
wants. There is considerable ‘technology elasticity’ as
customers want ‘latest technology.’ Innovation embeds
technological capabilities of electronics and chemical
fluids and concerns structural adaptation of products to
new technological possibilities
Suppliers play no role in regard to developing
technological capabilities. However, suppliers play an
important role in optimising direct cost new products
Indirect costs of R&D department/gross margin (costs of
experimentation)
External technology development
Innovation created by suppliers with close relations
Innovation from the outside
Innovation through suppliers’ unique knowledge
748
LeanTech
Production engineers
ABC margin
ABC margin visualises cost of complexity of
customised designs and constrains the number
of technology choices but it increases the
power of each hardware module. It reduces
J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
innovation by stipulating hardware choices but
extends innovation by using stronger
components
Hardware modules and software programs
developed in a lean supply chain
Innovation concerns process innovation
through modularisation of hardware and
internal software design, programming and
documentation
Suppliers play an important role as suppliers of
hardware and specialised software packages
Cost of capital (costs of simplification)
Larger software packages from suppliers with
surplus functionality and standard interfaces
for configuring modules
Innovation created by increasing use of
software packages with surplus functionality
and standard interfaces
Innovation from the outside
Innovation through close relationship with
suppliers of standardised software modules
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
Calculation 1
Inter-organisational
relation
Technological artefacts
Innovation strategy
Fig. 1. Elements in the analysis of the role of management accounting calculations in long translations.
help because its tension is difficult to appreciate without
mediation: economise time (in SuitTech), develop markets
though new technology (in HighTech), and make manufac-
turable solutions (in LeanTech). The calculation connects
the innovation activity to other concerns.
A short translation relates the calculation with changes
in innovators’ conduct but it does not question the innova-
tion strategy. It is short when it economises innovation
through influencing the time, resources and orientation of
innovators. It bends the innovation to its context by presen-
tation of financial effects in revenues, in contribution mar-
gins and gross margin. A relevant management accounting
calculation is specific and therefore partial, and its mobili-
sation requires support from others such as the order man-
ager (in SuitTech), the new product development manager
(in HighTech) and the production engineers (in LeanTech).
The long translation
In addition to the short translation, there are also long
translations generated by competing calculations. These
translations become longer because they develop complex
problematisation of the role of innovation in the firm
strategic consequences beyond the firm by taken many
more entities into account. The tension between calcula-
tions is important, and it can be illustrated generally as
in Fig. 1.
Fig. 1 illustrates that the stake in innovation manage-
ment is a struggle over with technological artefacts. Each
management accounting calculation defines some rules
in this struggle which proposes not only different compo-
sitions of technological artefacts but also different innova-
tion strategies and sourcing arrangements. Specifically, the
maps of the translations show connections between man-
agement accounting calculations, technological artefacts,
innovation strategy, and (inter-) organisational relations.1
Secondly it illustrates that there are competing calculations
which propose decisions about innovation and (inter-) orga-
nisation differently. Thirdly, there are two arrows – one bold
and one dotted. The bold arrow identifies a dominant pro-
1
These elements are clearly the ones identified in our research. In
principle, there could have been others.
749
Calculation 2
Alternative
Inter-organisational
relation
Alternative
Innovation strategy
cess of translation while a dotted arrow identifies a compet-
ing calculation which requires a different settlement of
innovation and (inter-) organisation. This work on the
boundary of the firm may be central in the management of
innovation in a period of time when firms’ strategies change
much faster than they can develop their competencies (Cas-
tells, 2000; Parolini, 1999). Figs. 2–4 show the application of
Fig. 1 on the three examples.
Fig. 2 illustrates the production of tensions between the
two calculations in SuitTech (sales and direct costs) over
the amount of special components that sales engineers
can legitimately take into consideration. The two calcula-
tions guide this decision differently. Sales performance ex-
pands the number of possible components because it
makes revenue considerations more important than cost
considerations and develops innovation through combina-
tion of components arriving from an extended space. Thus,
mobilising this calculation, engineers focus on customisa-
tion of products through combination of components and
the inter-organisational relation is a large, well-assorted
and heterogeneous inventory. Adding the direct cost to
the picture makes problematisation of this relation possi-
ble. When direct cost is mobilised, managers identify a ten-
sion between resources and efforts invested in designing
an order. Innovation through combination of special com-
ponents appears to be costly, and including direct cost in
the performance measures economises innovation activi-
ties by shifting attention to programmable components
that are more readily available and whose variation can
be guaranteed by software flexibility rather than by hard-
ware components. Innovation is here to a large extent met
by software programming. Inter-organisational relations
are then proposed to be an inventory of a limited range
of standard components that can be supplied steadily
and predictably. The more standardised the set of possible
components the more amenable innovation is to control
through a form of standard cost system.
Fig. 3 illustrates that, in HighTech, the struggle is
whether a large R&D department which takes pride in
developing general knowledge and not only product spe-
cific knowledge is appropriate. The contribution margin
approach sees the costs of the R&D department as a period
costs and allows it to develop its own distinctions and
750 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754

Direct cost
Sales Performance

Broad range of
innovative suppliers Arm’s length
relationship
Special component/
standard components

Combination of physical Software programming

components

Fig. 2. Long translation between management accounting calculations, innovation, and inter-organisational relations in SuitTech.

Indirect costs
Contribution margin

Supplier only
manufacturing Suppliers invovled in
technology development
Electronics/
chemical fluids

Experimentation Product innovation

efficiency

Fig. 3. Long translation between management accounting calculations, innovation, and inter-organisational relations in HighTech.

ABC margin Capital costs

Suppliers of special hard-

and software Few suppliers of
standard software
Hardware/
software

Software design, program- Configuration of modules

mingand documentation

Fig. 4. Long translation between management accounting calculations, innovation, and inter-organisational relations in LeanTech.

concerns protecting in-house capabilities related to elec-
tronics and chemical fluids. These activities are discretion-
ary investments and only to a lesser extent associated with
product profitability calculations. A positive contribution
margin is proposed to arise from increase in price rather
than reduction in cost. The cost calculation suggested as
a way to convert the period costs of the R&D department
into a product costs, in contrast, focuses on the efficiency
R&D investments and costs and it proposes external com-
petences in electronics fluids as possible new sources of
knowledge. Thus, the allocation of the period cost to
projects proposes to develop a stronger association
between individual R&D projects and individual product
development activities. In addition it also makes directed
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
outsourcing of R&D initiatives possible and thus develops a
new inter-organisational R&D agenda.
Fig. 4 illustrates, in LeanTech, a struggle over the use
of exotic components or general standard software. The
ABC margin motivates a limited range of complex, some-
times exotic, expensive components; cost of capital and
depreciation charges, in contrast, reduce complexity of compo-
nents and draw on standard software packages. These prop-
ositions reach into the inter-organisational space because
exotic and specialised components require concerned and
intensive interaction with suppliers about the components’
performance while the use of standard software packages
requires that the firm interacts with large suppliers who
can develop the technologies of their application largely
by themselves as they define the industry standard.
The tensions arising in the three examples of proposed
transformation are minimalist. When the three examples
draw new possible calculations into play they pay atten-
tion only to those parts hereof that will make its proposi-
tions different from the existing arrangement. It is likely,
however, that if the cost strategy would gain power in Suit-
Tech and HighTech managers would also quickly concern
themselves with revenues. Rather than seeing the oppos-
ing calculations as suggestions of effective management
control systems, they are much more problematising de-
vices which challenge dominating arrangements by high-
lighting the special features they problematise.
Management accounting calculations in tension
The three examples illustrate that innovation strategy
can be an effect of management accounting calculations.
The tensions between calculations are important because
they frame decision making, risk management and strate-
gic uncertainty by adding sequences of proposed effects.
The short and long translations both create contexts for
innovation activities but there are differences. The short
translation develops immediacy between innovation activ-
ities and economic effects. In the long translation some of
the power of a calculation derives from its tensions with
other calculations over the appropriate way in which to
make innovation a productive resource for the firm. The
tension is that there is not one but at least two ways in
which choices over technological components can be
made. The calculations provide these justifications which
are inside the process of translation rather than outside
it. The management accounting calculation does not judge
the relative merits of different propositions about innova-
tion; the management accounting calculation is part of
the proposition that it mediates.
If managers do not follow the calculation, they have to
produce another calculation to make their point. In order
to combat one calculation another one is needed. Calcula-
tions play a role in the development of new propositions of
the relevance, power, effects and character innovation in
relation to firm strategies. In LeanTech the ABC calculation
is able to rally interest only because it is possible to calculate
the cost of huge inventories. The problem of heterogeneity of
components is not visible before it has been made a calcula-
tion. If someone would claim, say, that innovation should be
‘more efficient,’ another voice would immediately say ‘show
751
me what you mean’ and then the calculation has to emerge.
Mere cognitive interpretation of innovation is not collec-
tively actionable; innovation has to be inscribed and made
a calculation before it can be acted on. This is the context that
the calculation develops and makes possible. Even people
who are inside an innovation – such as the R&D Director in
HighTech – have to step out and mobilise the management
accounting calculation when they want to say something
to justify innovation. Standing out is a movement, but not
a movement from one place to another. It is a movement into
a calculation where some effects can be proposed, surveyed
and compared. Mere mental interpretation is not enough. A
calculation is stronger.
The calculation requires a network of practices and
commitments to operate; it will not operate on its own.
Any particular economic category performs differently
across the three examples. For example, in LeanTech be-
cause of cost and time calculations it is possible to propose
an integrated, lean supply chain governed from one place.
In HighTech, also because of time and cost information it is
possible to contemplate outsourcing of R&D and in Suit-
Tech again because of cost information it is possible to con-
ceive of in sourcing of many production tasks. Likewise,
indirect cost can be proposed to drive value (HighTech)
and to destroy value (LeanTech). The calculations do not
determine their impact; they gain power in interaction
with the development of the entities they engage. Even if
some parts of the accounting calculation are strengthened,
it flows over in new ways; even if, for example, ABC calcu-
lations reduced production costs in SuitTech, it opened a
new space for increased cost of capital and depreciation
charges. Therefore, calculations gain strength not because
they are inherently good or reasonable but only by their
outside found in the activities and strategies it participates
in shaping and developing. This point extends questions
about the completeness of calculations (e.g., Lawler,
1983; Simons, 1995, p. 76-7) which suggests that the con-
tribution margin is more complete than sales performance,
and ABC margin is more complete than contribution mar-
gin. But the three examples show that completeness is
not a property of the calculation. It is useful to substitute
concerns about completeness with the relational qualities
of the whole network which constitutes the power of the
calculation. Sales performance, contribution margin and
ABC margin are powerful because they can motivate ac-
tions to be performed by innovators. This translation,
rather than represent the innovation choices, creates a
context for innovation activities to occur.2
2
The management accountants in the three firms claimed that their
extensions of the calculations were more complete than other calculations.
Direct cost was added to a sales figure in SuitTech, indirect cost was added
to contribution margin in HighTech and cost of capital was added to
Activity Based Costing in LeanTech. Accountants’ proposition to add
completeness in calculation is, however, a stylistic and formalistic concern
with the mathematics of inscription. Inscription is not a copy of the world
but only a particular ordering of the revenues and costs accumulated in the
accounting system; for the inscription to work, the world of innovation
activity and management has to be added and therefore even if more
complete stylistically and formally, they can be less complete in the world
of activity and strategy. The power of the calculation derives from its
intertwinement with action.
752 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
Management accounting calculations as context for
innovation and sourcing arrangements
Research which suggests a constructive role for man-
agement accounting calculations in developing innovation
observes that managers develop dialogue about calculations
in the pursuit of innovation (e.g., Davila, 2000; Hansen &
Jönsson, 2005; Jönsson & Grönlund, 1988; Nixon, 1998; Si-
mons, 1987; Simons, 1990). The addition proposed by the
three examples is that the calculations do not only work
by moving closer to innovation and by looking more care-
fully at details of innovation practices. It may be that inter-
active use, or use of multiple financial and non-financial
calculations, focus attention to certain ways of seeing the
firm through more details and more interactions, and the
corollary probably is that managers know more about the
details of affairs and develop a unitary interpretation of
the demands of complex markets. The three examples
show, in contrast, that the important link is the movement
of innovation away from its place into diverging concerns
about the sourcing and strategy.
Like Håkansson and Lind (2004) and Miller and O’Leary
(2007, 2005) the three examples illustrate that innovation
activities are often inter-organisational and that mediating
technologies help firms enrol others in this accomplish-
ment. The calculations are involved in coordinating the
firm’s inter-organisational field by extending existing con-
figurations of actors and interests into alternative possible
configurations. As Miller and O’Leary point out, markets,
knowledge and actors are co-produced in the development
of innovation activities: markets, science and organisation
are co-produced via mediating technologies. In the three
examples, management accounting technologies mediate
the development of firm boundaries, capabilities and mar-
ket requirements.
Management accounting calculations mobilise the envi-
ronment and a variety of propositions are added that make
up not only existing environments and but also possible
ones. The three examples illustrate how the composition
of the environment is in process. It may be that Simons’
(1990, p. 142) concerned question ‘‘How do managers
identify strategic uncertainties?” can be addressed by the
three examples. The solution appears simple – change
the role of the calculation in the system of explanation
and the environment emerges as an effect of the analysis.
More particularly, this means that it is possible to contem-
plate and prepare for the environment through calcula-
tions. Perhaps this is why Simons’ (1987) prospectors use
a lot of information. They are prospectors exactly because
they have become knowledgeable about many aspects of
the environment which is then used to design and cultivate
the prospecting abilities. The tensions between calcula-
tions produce this opportunity. The three examples illus-
trate that management accounting calculation can be
mobilised to extend strategy in addition to implement
strategy. In effect management calculations can command
much more than they calculate.
Even if the calculation produces visibility, it is not pri-
marily about the contours of the objects it proposes to
manage. Rather than making a claim to increase visibility
more and more into details of organisational spaces (e.g.,
Ezzamel et al., 2004; Ezzamel et al., 2008), the manage-
ment accounting calculation may also gain by relating
the economy to other entities such as innovation and envi-
ronment. In this optic, sales performance speaks for the
firm and identifies the difference between firm, suppliers
and customers in SuitTech. Contribution margin speaks
for the role of technology in developing markets in High-
Tech. ABC margins speak to reduce the cost of production
complexity developed by innovative arrangements in
LeanTech. They all relate concerns about innovation and
inter-organisational relations to concerns of other situa-
tions and events in the firm and beyond. It transports con-
cerns about innovation by relating them to other concerns
such as production within the firm more than to the indi-
vidual concern of the innovation situation. The manage-
ment accounting calculation is strong because it helps to
develop context (see also Mouritsen, 1999).
Conclusions
A management accounting calculation does not de-
scribe or represent innovation and sourcing activities in
any detail, but it adds perspective to them and relates
them to the firm. In effect the management accounting cal-
culation is part of a relationship between economy, inno-
vation and environment. The management accounting
calculation speaks for the firm and puts pressure on inno-
vation to account for its contribution in this respect.
Based on examples from three firms, management
accounting calculations – sales performance, contribution
margin, and ABC margin – are mobilised in relation to
innovation and in turn, surprisingly, in relation to sourcing
and strategy. The management accounting calculation
works by extending or reducing the number of entities that
innovation can take into account, less by describing the
dimensions of innovation and inter-organisational design
and more by adding perspective to them. This mechanism
is stronger when a calculation is challenged by another
one. This is when there is maximum pressure on innova-
tion activities to show their strategic significance. The ten-
sions between calculations bend organisational activities
such as innovation to considerations such as growth, pro-
ductivity, profitability, and liquidity.
Management accounting calculations mediate and
mobilise innovation through short and long translations.
Short translations exist when management accounting cal-
culations encourage extension or reduction of innovation
activities when it proposes performance to be adequate or
inadequate. Long translations mobilise at least two calcula-
tions to problematise the role of innovation for corporate
purposes differently. Management accounting calculations
challenge each other and develop organisational struggles
not only about the role of innovation, but also about its
location in time and space technologically, organisationally
and environmentally. The process of developing relations
is, paradoxically, dependent on the management account-
ing calculation being partial because then it presents
tensions. The calculation can never be total.
Management accounting calculations can motivate
very long sequences of translation as they are associated
with strategic propositions about technology and the
boundaries of the firm. One of the possible effects of such
 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
translations is that the firm’s strategy for managing inno-
vation can undergo drastic reformulation. Another effect
of translation is that management accounting calculations
may create surprising effects very far from their presumed
outcomes. When new calculations come into existence
they reach into new situations that, in turn, influence the
role of the calculation.
Generally, the management accounting calculation
holds certain characteristics of innovation in place by
showing their broader justification. Sometimes the man-
agement accounting calculation shows this as a short
translation where the calculation is tightly coupled to deci-
sions regulating the innovation activity. In other situations,
however, the management accounting calculation enter-
tains a long translation though interaction with other cal-
culations where many new elements from whole systems
of innovation are taken into account. Challenging a certain
innovation system, opponents mobilise other management
accounting calculations that draw other consequences of
innovation. Innovation is thus not developed merely be-
cause of good innovative ideas; innovation has to pass
the test of management accounting calculations before it
can be heard, and the challenge is a whole system of inno-
vation and sourcing that is given corporate relevance
through the management accounting calculations. Man-
agement accounting calculations problematise the firm,
its innovation and technologies, and its boundaries.
Acknowledgements
We wish to thank participants at workshops and semi-
nars who have provided valuable comments. The two
anonymous reviewers have been very patient and support-
ive, and we extend our thanks to Anthony Hopwood, Ariela
Caglio, Angelo Ditillo, Christina Boedker, and Habib
Mahama.
References
Abernethy, M. A., & Brownell, P. (1997). Management control systems in
research and development organisations: The role of accounting,
behaviour and personnel controls. Accounting, Organisations and
Society, 22(3/4), 233–248.
Abernethy, M. A., & Stoelwinder, J. U. (1991). Budget use, task uncertainty,
system goal orientation and subunit performance: A test of the fit
hypothesis in not-for-profit hospitals. Accounting, Organisations and
Society, 16(2), 105–119.
Ahrens, T., & Chapman, C. (2004). Accounting for flexibility and efficiency:
A field study of management control systems in a restaurant chain.
Contemporary Accounting Research, 21(2), 271–302.
Ahrens, T., & Chapman, C. S. (2007). Management accounting as practice.
Accounting, Organisations and Society, 32(1/2), 1–27.
Alvesson, M. (2003). Beyond, neopositivits, romantics and localists. A
reflexive approach to interviews in organisational research. Academy
of Management Review, 28(1), 13–33.
Amabile, T. M., Conti, R., Coon, H., Lasenby, J., & Herron, M. (1996).
Assessing the work environment for creativity. Academy of
Management Journal, 39(5), 1154–1184.
Birnberg, J. G. (1988). Discussion of an empirical analysis of the
expenditure budget in research and development. Contemporary
Accounting Research, 4, 582–587.
Bisbe, J., & Otley, D. (2004). The effects of the interactive use of
management control systems on product innovation. Accounting,
Organisations and Society, 29(8), 709–737.
Boland, R. J., Jr., & Pondy, L. R. (1983). Accounting in organisations: A
union of natural and rational perspectives. Accounting, Organisations
and Society, 8(2/3), 223–234.
753
Briers, M., & Chua, W. F. (2001). The role of actor-networks and boundary
objects in management accounting change: A field study of an
implementation of activity-based costing. Accounting, Organizations
and Society, 26(3), 237–269.
Brownell, P. (1985). Budgetary systems and the control of functionally
differentiated organisational activities. Journal of Accounting Research,
23(2), 502–512.
Burns, T. G., & Stalker, M. (1961). The management of innovation. London,
UK: Tavistock.
Callon, M. (1986). Some elements of a sociology of translation:
Domestication of the scallops and the fishermen on St. Brieuc Bay.
In J. Law (Ed.), Power, action and belief. A new sociology of knowledge?
(pp 196–233). London: Routledge and Kegan Paul.
Callon, M., & Latour, B. (1981). Unscrewing the big Leviathan: How actors
macro-structure reality and sociologists help them to do so. In K.
Knorr-Cetina & A. V. Cicourel (Eds.), Advances in social theory and
methodology. Towards an integration of micro- and macro-sociologies
(pp. 277–303). London: Routledge and Kegan Paul.
Castells, M. (2000) (2nd ed.). The rise of the network society (Vol. 1).
Malden, MA, USA: Blackwell Publishers.
Chua, W. F. (1995). Experts, networks and inscriptions in the fabrication
of accounting images: A story of the representation of three public
hospitals. Accounting, Organisations and Society, 20(2/3), 111–145.
Clark, K. B., & Fujimoto, T. (1991). Product development performance.
Boston: Harvard Business School Press.
Cooper, R. (1992). Formal organisation as representation: Remote control,
displacement and abbreviation. In M. Reed & M. Hughes (Eds.),
Rethinking organisation – New directions in organisation theory and
analysis (pp. 254–272). London: Sage.
Cooper, R. (1997). The visibility of social systems. In K. Hetherington & R.
Munro (Eds.), Ideas of difference (pp. 32–41). Oxford: Blackwell
Publishers/The Sociological Review.
Cooper, R. G., & Kleinschmidt, E. J. (1987). New products: What separates
winners from losers? Journal of Product Innovation Management, 4(3),
169–184.
Cooper, R., & Slagmulder, R. (2004). Interorganisational cost management
and relational context. Accounting, Organisations and Society, 29(1),
1–26.
Damanpour, F. (1991). Organisational innovation: A metaanalysis of
effects of determinants and moderators. Academy of Management
Journal, 34(3), 555–590.
Davila, T. (2000). An empirical study on the drivers of management
control systems’ design in new product development. Accounting,
Organisations and Society, 25(4/5), 383–409.
Davila, T., & Wouters, M. (2004). Designing cost-competitive technology
products through cost management. Accounting Horisons, 18(1),
13–26.
Dougherty, D., & Hardy, C. (1996). Sustained product-innovation in large,
mature organisations: Overcoming innovation- to-organisation
problems. Academy of Management Journal, 39(5), 1120–1153.
Ezzamel, M., Willmott, H., & Worthington, F. (2004). Accounting and
management-labour relations: The politics of production in the
‘factory with a problem’. Accounting, Organisations and Society,
29(3/4), 269–302.
Ezzamel, M., Willmott, H., & Worthington, F. (2008). Manufacturing
shareholder value: The role of accounting in organisational
transformation. Accounting, Organisations and Society, 33(1/2),
107–140.
Gerwin, D., & Kolodny, H. (1992). Management of advanced manufacturing
technology: Strategy, organisation and innovation. Chichester: John
Wiley and Sons.
Håkansson, H., & Lind, J. (2004). Accounting and network coordination.
Accounting, Organisations and Society, 12(1), 41–74.
Hall, R. H. (2001). Organisations: Structures, process, and outcomes (8th ed.).
Upper Saddle River, NJ: Prentice-Hall.
Hansen, A., & Jönsson, S. (2005). Target costing and coordination –
Framing cost information sharing in new product development. In S.
Jönsson & J. Mouritsen (Eds.), Accounting in Scandinavia – The northern
lights. Liber and Copenhagen Business School Press.
Hayes, D. (1977). The contingency theory of managerial accounting. The
Accounting Review, 52(1), 22–39.
Hines, R. D. (1988). Financial accounting: In communicating reality, we
construct reality. Accounting, Organisations and Society, 13(3),
251–261.
Hoskin, K. W., & Macve, R. H. (1986). Accounting and the examination: A
genealogy of disciplinary power. Accounting, Organisations and Society,
11(2), 105–136.
Ittner, C., & Kogut, B. (1995). How control systems can support
organisation innovation. In E. H. Bowman & B. M. Kogut (Eds.),
754 J. Mouritsen et al. / Accounting, Organizations and Society 34 (2009) 738–754
Redesigning the firm (pp. 155–180). New York: Oxford University
Press.
Jönsson, S., & Grönlund, A. (1988). Life with a subcontractor: New
technology and management accounting. Accounting, Organisations
and Society, 13(5), 512–532.
Kreiner, K., & Mouritsen, J. (2005). The analytical interview – Relevance
beyond reflexivity. In S. Tengblad, R. Solli, & B. Csarniawska (Eds.), The
art of science (pp. 153–176). Malmø: Liber and Copenhagen Business
School Press.
Latour, B. (1987). Science in action. Cambridge, Mass: Harvard University
Press.
Latour, B. (2005). Reassembling the social. Oxford: Oxford University Press.
Law, J. (1996). Organising accountabilities: Ontology and the mode of
accounting. In R. Munro & J. Mouritsen (Eds.), Accountability: Power,
ethos and the technologies of managing (pp. 283–306). London:
Chapman Hall.
Lawler, E. E. III, (1983). Control systems in organisations. In M. D.
Dunnette (Ed.), Handbook of industrial and organisational psychology
(pp. 1247–1291). New York: John Wiley and Sons.
Leonard-Barton, D. (1995). Wellsprings of knowledge. Boston: Harvard
Business School Press.
Miles, R. E., & Snow, C. C. (1978). Organisational strategy, structure and
process. New York: McGraw-Hill.
Miller, P. (2001). Governing by numbers: Why calculative practices
matter. Social Research, 68(2), 379–396.
Miller, P., & O’Leary, T. (1994). Accounting, ‘economic citizenship’ and the
spatial reordering of manufacture. Accounting, Organisations and
Society, 19(1), 15–43.
Miller, P., & O’leary, T. (2005). Capital budgeting, co-ordination and
strategy: A field study of inter-firm and intra-firm mechanisms. In C.
Chapman (Ed.), Controlling strategy: management, accounting and
performance measurement. Oxford: Oxford University Press.
Miller, P., & O’Leary, T. (2007). Mediating instruments and making
markets: Capital budgeting, science and the economy. Accounting,
Organisations and Society, 32(7–8), 701–734.
Miller, P., & Rose, N. (1990). Governing economic life. Economy and
Society, 19(1), 1–31.
Mouritsen, J. (1999). The flexible firm: Strategies for a subcontractor’s
management control. Accounting, Organisations and Society, 24(1),
31–55.
Nixon, B. (1998). Research and development performance measurement:
A case study. Management Accounting Research, 9(3), 329–355.
Ouchi, W. G. (1977). The relationship between organisational structure and
organisational control. Administrative Science Quarterly, 22, 95–113.
Ouchi, W. G. (1979). A conceptual framework for the design of
organisational control mechanisms. Management Science, 25(8),
833–848.
Parolini, C. (1999). The value net. NY: John Wiley.
Preston, A. M., Cooper, D. J., & Coombs, R. W. (1992). Fabricating budgets:
A study of the production of management budgeting in the national
health service. Accounting, Organisations and Society, 17(6), 561–593.
Quattrone, P., & Hopper, T. (2005). A ‘time–space odyssey’: Management
control systems in two multinational organisations. Accounting,
Organisations and Society, 30(7–8), 735–764.
Raelin, J. A. (1985). The basis of professionals’ resistance to management
control. Human Resource Management, 24(2), 147–175.
Robson, K. (1992). Accounting numbers as inscription: Action at a
distance and the development of accounting. Accounting,
Organisations and Society, 17(7), 685–708.
Rockness, H. O., & Shields, M. D. (1984). Organisational control systems in
research and development. Accounting, Organisations and Society, 9(2),
165–177.
Rockness, H. O., & Shields, M. D. (1988). An empirical analysis of the
expenditure budget in research and development. Contemporary
Accounting Research, 4, 568–581.
Simons, R. (1987). Accounting control systems and business strategy: An
empirical analysis. Accounting, Organisations and Society, 12(4),
357–374.
Simons, R. (1990). The role of management control systems in creating
competitive advantage – New perspectives. Accounting, Organisations
and Society, 15(1/2), 127–143.
Simons, R. (1991). Strategic orientation and top management attention to
control systems. Strategic Management Journal, 12(1), 49–62.
Simons, R. (1994). How new top managers use control systems as levers
of control. Strategic Management Journal, 15(3), 169–189.
Simons, R. (1995). Levers of control – how managers use innovative control
systems to drive strategic renewal. Boston: Harvard Business School
Press.
Tidd, J., Bessant, J., & Pavitt, K. (1997). Managing innovation: Integrating
technological, market and organisational change. Chichester: John
Wiley and Sons.
Tushman, M. L., & O’Reilly, C. A. (1997). Winning through innovation: A
practical guide to leading organisational change and renewal. Boston,
MA: Harvard Business School Press.
Vaivio, J. (1999). Examining ‘the quantified customer’. Accounting,
Organisations and Society, 24(8), 689–715.
Verona, G. (1999). A resource-based view of product development.
Academy of Management Review, 24(1), 132–142.
Widener, S. K. (2007). An empirical analysis of the levers of control
framework. Accounting, Organisations and Society, 32(7/8), 757–788.
Yin, R. K. (1994). Case study research. Design and methods. Thousand Oaks:
Sage Publication.
Ziger, B., & Maidique, M. (1990). A model of new product development:
An empirical test. Management Science, 36(7), 867–883.