Factors promoting and hindering the adoption of management accounting tools: empirical evidence from Italian manufacturing SMEs

This paper aims to provide empirical evidence of the factors considered rele-vant in promoting the adoption of Management Accounting (MA) tools, and those able to hinder their spread in Italian manufacturing small and medium-sized enterprises (SMEs), trying to fill the gap between theory and practice. A questionnaire was sent via email, together with a cover letter, to a total popula-tion of 1,100 Italian manufacturing SMEs, which were selected from AIDA da-tabase (Bureau Van Dijk - A Moody's Analytics Company). The survey was designed to gather background information about the firm, to identify the fac-tors considered relevant in promoting the adoption of MA tools, as well as data pertaining the variables able to hinder the spread of these tools. Finally, the extent of use of MA tools by Italian SMEs has been investigated. More specifi-cally, 102 completed questionnaires were returned for a response rate of 9.2 percent. The sample is composed of family businesses, which operate in the textile, paper and wood sector, mainly located in the North of Italy. The sam-pled enterprises are mostly of medium-sized, with a mean number of employ-ees equal to 80 and a turnover of 15 mln euro. The main factors favouring the adoption of MA tools are the information and entrepreneurial needs, the ad-ministration and control managers' requests, the competition increase, the awareness on the crucial role of the control system in supporting the decision-making process, the willingness on monitoring of risks associated to decisions, the implementation of advanced information systems, the climate of sharing about cost-benefit concerning to MA tools, a favourable organizational culture and, finally, specific training on these themes. Contrary, the elements able to hinder the spread of these tools are related to the lack of interest by the entrepreneurs, the lack of knowledge regarding the potentiality of MA tools, the lack of time, the scarcity of financial and human resources, the scarce propensity to delegate in the management and control area and, finally, the high complexity of MA tools. The investigated SMEs assert to mainly use budgeting tools, analysis of finan-cial statements, benchmarking practices and customer satisfaction analysis. These instruments are used to support operational and productive decisions. Unfortunately, only some respondents attribute the strategic role to the MA tools. The respondents recognize the usefulness of MA tools contributing to the achievement of corporate objectives and to the improvement of economic and financial performance. This research attempts to restrict the distance be-tween theory and practice in MA discipline, highlighting the factors able to foster or hinder the spread of MA tools in Italian SMEs. The findings show the pivotal role of entrepreneurs and employees in promoting the implementation of MA tools to benefit the entire organization. The awareness of the im-portance of the control system by entrepreneurs is fundamental to support in-vestments in qualified human resources and specific training. The universities, industrial associations, and consultants should encourage the development of MA systems among SMEs, to make the decisional processes more rationale and based on data, instead of intuitive.