Use this URL to cite or link to this record in EThOS: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.619491
Title: The relationship between lean service, activity-based costing and business strategy and their impact on performance
Author: Hadid, Wael
ISNI:       0000 0004 5358 5612
Awarding Body: Brunel University
Current Institution: Brunel University
Date of Award: 2014
Availability of Full Text:
Access through EThOS:
Access through Institution:
Abstract:
Lean system has drawn the attention of researchers and practitioners since its emergence in 1950s. This has been reflected by the increasing number of companies attempting to implement its practices and the large number of researchers investigating its effectiveness and identifying important contextual factors which affect its implementation. The rising level of interest in lean system has led to the emergence of three distinctive streams of literature. The first stream of literature has focused on the effectiveness of lean system. However, this literature was limited as it mainly examined the additive impact of lean practices on operational performance in the manufacturing context. The second stream of literature has focused on the role the accounting system in the lean context. In this body of literature, there was an agreement among researchers on the superiority of activity-based costing system (ABC) over the traditional accounting system in supporting the implementation of lean practices. However, most studies in this strand of literature were either conceptual or case-based studies. The third stream of literature has focused on the fit between business strategy and lean system. However, inconclusive results were reported in relation to the suitability of lean system to firms adopting the differentiation strategy and others adopting the cost leadership strategy. The aim of this study is to develop and empirically test a conceptual model which integrates the three distinctive streams of literature to extend their focus and overcome their limitations. More specifically, the model developed in the current study highlights not only the additive impact of lean practices but also the possible synergy among those practices in improving both operational and financial performance of service firms. In addition, the model brings to light the potential intervening role of ABC in the strategy-lean association. After identifying and reviewing the relevant literature, the socio-technical system theory and contingency theory were used to develop the conceptual model and associated hypotheses. A questionnaire instrument was designed to collect empirical data which was supplemented by objective data from the Financial Analysis Made Easy database in order to empirically test the conceptual model using partial least squares structural equation modelling (PLS-SEM). The findings of this study indicated that while the technical practices of lean service improved only the operational performance of service firms, the social practices enhanced both operational and financial performance. In addition, the two sets of practices positively interacted to improve firm performance over and above the improvement achieved from each set separately. Moreover, ABC was found to have a positive association with lean practice, and consequently an indirect positive relation with firm operational performance. Finally, both the differentiation and cost leadership strategy had a direct positive relationship with lean practices. However, while ABC was found to partially mediate the differentiation-lean association, it suppressed the cost leadership-lean association leading to a case of inconsistent mediation. The current study contributes to the current literature at different levels. First, at the theoretical level, this study develops a conceptual framework which crosses different streams of literatures mainly, lean system literature, management accounting literature (with focus on ABC), and business strategy literature. Unlike previous studies, by integrating the perspective of socio-technical system theory and contingency theory, the model (i) highlights not only the additive but also the synergistic effect of lean service practices on firm performance, (ii) brings to light the direct impact of ABC and business strategy on lean service practices and the intervening role of ABC due to which the business strategy is assumed to have also an indirect influence on lean practices, and (iii) offers an alternative view on how ABC can improve firm performance by enhancing other organisational capabilities (lean practices) which are expected to improve performance . Second, at the methodological level, unlike previous studies, this study includes a large number of lean service practices and contextual variables to report more precisely on the lean-performance association. In addition, the inclusion of the financial performance dimension-measured by secondary data- in the model besides the operational performance is critical to understand the full capability of lean service in improving firm performance. Further, employing a powerful statistical technique (PLS-SEM) provides more credibility to the results reported in this study. Third, at the empirical level, this study is conducted in the UK service sector. As such, this study is one of the very few studies that have reported on lean service and examined how the adoption of ABC and a specific type of business strategy can affect its implementation using empirical survey data from this context.
Supervisor: Mansouri, A.; Gallear, D. Sponsor: Syrian Ministry of Higher Education
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID: uk.bl.ethos.619491  DOI: Not available
Keywords: Management accounting ; Interactionanalysis ; Partial least squares ; Contingency theory ; Socio-technical system theory
Share: