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This chapter summaries the key findings and results from the data collected in questionnaire survey. Besides, it also discusses about the research contributions and the limitations on this study as well as provides some recommendations for the future research.
Summaries of Findings
Nowadays, we cannot deny the contribution of small and medium enterprises (SMEs) in Malaysia. This is because SMEs are play an important role in the develop Malaysian economic. SMEs are capable of providing jobs and generating output using local resources. As mention in chapter 1, this study focuses on the strategic management accounting practices (SMA) in metal products manufacturing industry of Malaysian SMEs. The reason of choosing metal products industry is because Malaysia's basic metal industries, which include the iron & steel industries and the non-ferrous metal industries, have seen significant developments since the last three decades. This industry make a significant contribute to other sectors of the Malaysian economy, especially the construction industry, electrical/electronic industry, automotive industry, furniture industry, machinery industry, engineering fabrication industry, food and packaging industry. In addition, with the expected increase in demand from the property market, coupled with new plants coming into operation, prospects for the Malaysia steel industry remain favorable.
In this research, MAPs acted as a role in ensuring the management of an organisation is efficient and effective and improve its performance. MAPs also permit organisation to compete in the intense market place and reduce the likelihood of business failure. Therefore, it is important to promote knowledge and awareness of MAPs among SMEs in Malaysia so that organisation may benefit from the advantages that have been stated above. The first objective can be fulfilled by analyses the section B in the questionnaire. Regardless the size of an organization, majority of them still use traditional techniques which is budgeting and standard costing. However, there is show an increasing in adopting strategic MAPs such as target costing, just-in-time, performance measurement as well as total quality management (TQM).
Besides that, the second objective of this research can also be achieved via the questions of the reason of use or not use said MAPs as well as the important of the MAPs. Most of the respondents perceived product pricing is the most important in using the MAPs. While SMEs also always use said MAPs since it can save time and cost. However, majority of the SMEs still not adopted SMA in their organization. This is because they perceived that some MAPs are costly to them.
Most of the respondents also consider that there is a need to improve the current use of MAPs in their company. This can be helps the company to increase the efficiency and effectiveness of the company to compete in competitive market. Besides that, there also have respondent refuse to improve the MAPs used by it company due to their MAPs currently is in good practice, therefore, not necessary to further improve as the changing would take up a long time to actually realize them.
Moreover, this research also aims to answer the relationship between the selected contingency factors and the use / change or MAPs in metal products manufacturing industry of Malaysian SMEs. The analysis reveals that organisational strategy and ability and competencies of human resource have a significant positive relationship with the use / change of MAPs in metal products manufacturing industry of Malaysian SMEs. In simple words, we can conclude that the increase of implementation of organizational strategy and the ability and competencies of human resource, the increase the use of strategic MAPs.
This research regards the use of MAPs in metal products manufacturing industry of Malaysian SMEs. Although there is some literature explores the use of MAPs, the focus has been on large firms. Less previous research has exclusively issued the use of MAPs in SMEs especially in a developing country such as Malaysia. Therefore, this research makes a contribution by providing knowledge of MAPs in SMEs in a developing country. The research is distinct not only because it documents the use / change of MAPs in metal products manufacturing industry among SMEs in Malaysia; but also because it state the reason of use or not use of MAPs; investigates factors affecting the use of MAPs, and examines the change in MAPs.
Besides that, by reduce the research gap, this study need to understanding the recent developments of MAPs in metal products manufacturing industry of Malaysian SMEs in advance particularly in a developing country by adding new empirical evidence to the body of knowledge on the use of MAPs (Mitchell et al., 1998; Mitchell and Reid, 2000; and Nimtrakoon, 2009). Therefore, via this study,
Next, the relationship between the use / change of MAPs and selected contingency factors was examined. The findings indicate that MAPs are most influenced by factors within the organization such as organizational strategy and ability and competencies of human resource. According to Chenhall and Langfield-Smith (1998) and El-Ebaishi et al. (2003), in order to enhance understanding of potential contingency factors which explain the use of MAPs, this research has responded to the recent calls for additional contingency based research in management accounting. It extends the body of knowledge that uses contingency theory to explore the significance of contingency variables in metal products manufacturing industry of Malaysian SMEs.
The study also contributes to the increase both awareness of and understandings of the importance of MAPs within SMEs since these practices are vital ingredients in the success of any organizations. The results represent that traditional MAPs have high level of usage but the SMA also start to adopt by SMEs. Perhaps Malaysian policy makers could provide training in these techniques in universities as well as college for students in Malaysia.
In conclusion, this study presents a comprehensive survey and explanations of the use of MAPs as well as the contingency factors in metal products manufacturing industry of Malaysian SMEs and therefore makes a contribution to the awareness of management accounting in SMEs particularly in a developing economy.
Limitations of the study
There are few limitations found in this study. Firstly, the low response to the questionnaire survey potentially introduces non-response bias. Non-response bias is the bias that results when respondents differ in meaningful ways from non-respondents. This is because individuals chosen for the sample are unwilling or unable to participate in the survey. Since the implementation of good and service tax (GST), most of the firms are busy for the preparation of the upcoming GST, therefore, respondent are chosen do no answer the questionnaire. Therefore, data collection for SMEs is difficult and therefore the limitation of low response rates cannot be avoided.
Second, the range of selected contingency variables used in this study is quite small. This cannot reflect the real complex environment in operational and competitiveness of SMEs. Besides that, to avoid confusing respondents or discouraging them from responding by excessive complexity, the limited number of variables was also decided and selected.
Moreover, from the data collected from the respondents, there are possible that misinterpretation or misunderstanding of questions. The respondents maybe don’t understand the meaning of some specific terms such as computer aided design, direct numerical control and kaizen costing. This maybe not reflects the real answer from respondents. Some of the respondents are also fill in the questionnaire without seriously read the questions, therefore, this cause the data inconsistent and not significant. For example, few or the respondents are fill in the answer of less significant for all the contingency variables.
Furthermore, the results were derived from the responses of a majority of accounting executive who are likely have some biased views in the success of management accounting techniques and practices. This is why a few results of strategic management accounting practices relatively higher than in the previous study.
Lastly, most of the respondents are unwilling to answer the open-ended questions in the questionnaire survey. They are unwilling to think and write a long the answers. Therefore, they choose to no answer the question by put the symbol “n/a” Besides that, for the question that need to further explanation, respondents will bias to choose the answer with no further explanation needed. This will cause the inconsistent with the previous study.
Despite these limitations, the study provide evidences on the extent of use / change of MAPs in metal products manufacturing industry by Malaysian SMEs with additional information on the reason of use or not use the MAPs as well as the contingency factors that affected the use / change of MAPs in Malaysian SMEs. It is suggested that, this study has made an important contribution to research on the employment of MAPs and has successfully responded to the need for research into MAP usage in metal products manufacturing industry of SMEs in developing countries.
Recommendations For The Future Research
From the result of this study, there are raised few recommendations to warrant future research. First of all, the sample of small and medium firms should be separated and extended to achieve a valid set of responses. The small-sized and medium-sized of firms should be analyses separately because this may cause different result on the extent of use / change of MAPs as well as highlight the effect of contingency factors in different contexts. However, this may prove difficult as there must be the possibility that small firms without MAPs will be much less likely to complete the questionnaire or medium firms unwilling to cooperate due to the implementation of GST and thus bias the responses.
Second, it might be advantageous to focus on a sample of an industry at a single area. In this study would be concludes the same result of the use / change of certain types of MAPs at every area. In reality, the use of MAPs may be different in different area such as city and rural. The separate sample in different area will make the data more precisely.
Third, it is need to further investigate the nature of the dependence between traditional and strategic MAPs. The lower use of strategic MAPs raises the question of the conditions necessary implement these techniques effectively within smaller firms. However, a qualitative case study approach would be likely to provide additional insights instead of gleaned from a questionnaire survey approach.
Fourth, research in this area can be developed by conducting a comparative study of the Malaysian situation on adoption of MAPs against that in other developing countries in order to explore differences contingent factors.
Last but not least, it is predict that there is increase global competitiveness in the metal products industry in Malaysia at next few years. Therefore it would be expand the survey to provide a longitudinal study of the use / change of MAPs by documenting the changes over time in the adoption of specific management accounting techniques in a detailed way.