CIMA Executive report on management accounting by Graham S. Pitcher

Management accounting in support of the strategic management process

The term 'strategic management accounting' was introduced in 1981 and was defined as ‘the provision and analysis of management accounting data about a business and its competitors, for use in developing and monitoring business strategy’. Since then several attempts have been made to refine this definition and identify a set of techniques classified under the banner of strategic management accounting.


However, there has been little agreement within the academic and professional literature on the definition of strategic management accounting and the associated techniques, nor is the term widely used by practising accountants. The project seeks to investigate and enhance understanding of: 

  • The extent to which management accounting is utilised to support strategic decision making and the strategic management process within organisations. 
  • The most common aspects of strategic decision making where management accounting is seen to make a significant contribution. 
  • The management accounting tools that are utilised in a strategic context. 
  • The extent to which it is possible to define the concept of strategic management accounting within a wider definition of management accounting.  
  • The research includes quotes from finance directors about their experience in the strategic management process.

"… from a change perspective to be able to handle organisational change, as a management accountant, you need to understand what a decision’s going to do to the business, what are the new requirements that are going to come out of this and how will it change? How will this affect the information requirements? How will it affect your interpretation of what’s going to start coming through the business so that you can start commenting accurately on it?"


"Because the value that they [the accounting team] bring to our business is out there [points to outside of the office], it’s to use the skills that they’ve got to support managers in running their businesses. And the more time that they spend away from their desk, the better. "

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