The role of broad scope MAS information in linking organisational market orientation and performance

Abstract

We investigate the mediating role of information provided by management accounting system (hereafter, MAS information) in the relationships between organisations’ market orientation (MO) capability and organisational performance. The data for the study were collected from 131 general managers of medium to large manufacturing organisation in Indonesia. Partial least squares structural equation modelling (PLS-SEM) was used to test the hypotheses. Our literature review reveals that prior research on market orientation and performance ignored the role of MAS information. The results indicate that managerial use of broad scope MAS information partially mediates the relationships between organisation’s market orientation and financial, customer,internal business process and learning and growth-related performance. However, the partial mediation role played by managerial use of the scope MAS information in the relationship between an organisation’s market orientation and customer-related performance is relatively weak. By investigating the role of managerial use of broad scope MAS information in the relationship, this study contributes towards theory development. The results also contribute to practice by facilitating managers’ understanding of how their organisation’s market orientation and managerial use of MAS information can promote the organisation’s performance.