The Role of Cognitive and Affective Conflict - Essay Example

Critical Analysis of a Research Paper: The Role of Cognitive and Affective Conflict in Early Implementation of Activity-Based Cost Management This is a critical analysis of an article entitled “The Role of Cognitive and Affective Conflict in Early Implementation of Activity-Based Cost Management.” It was written by Robert H. Chenhall of Monash University, and was published in 2004. This research paper was chosen for analysis because it provides an insight into the behavioural implications introducing a new procedure in a firm’s accounting system. The analysis shall first provide a description of the paper, comment on the title and each section of the study, evaluate the usefulness of its findings for application in management accounting, and put in a time table for the completion of the critical analysis. 1. Critical Analysis of the Research Paper 1.1 Overall description/ summary of the research paper The article is an empirical study of the problems concerning the implementation of activity-based cost management (ABCM), particularly during its introductory phase, as the new system impacts on the behavioural element in the organization. Two conflicts are apparently engendered when ABCM is newly implemented – there is the cognitive conflict and the affective conflict. The study tries to discover empirical evidence, through a survey of 56 senior managers representing as many manufacturing companies that have adopted the use of ABCM in their organizations. Through the use of regression and correlation statistics, the results of the survey are expected to yield insights into the relationship between conflict constructs and the seleted ABCM implementation factors. Through this study, the researcher hopes to gain insight into how manufacturing companies may benefit, financially and operationally, from activity-based cost management, while mitigating the adverse effects and enhancing the beneficial effects of behavioural considerations attendant to the change. 1.2 Critical Analysis Title The title is somewhat long-winded, but it does convey a good idea of the topic of the research study. It conveys the subject of how employees behave when change is introduced in an organization. It also captures the interest of the business student to know more about what activity-based cost management is and why it would result in behavioural conflict. From the point of view of managers, the title immediately hints that this study could provide useful insight into best practices in the management of change, in particular regarding activity-based cost management. Abstract and Introduction The abstract is particularly well written. The dilemma addressed by the study is described in a way that could be easily understood by readers with a reasonable familiarity with business organizations. Hands-on managers and business students who intend to perform supervisory functions are benefited by the abstract’s mention of the implementation of an innovation rather than its technical design. The abstract likewise draws the difference between cognitive and affective conflict and its implications on the introduction of activity-based cost management (ABCM). In all, the abstract gives a good snapshot of the entire study. The introduction is likewise well planned out, so that it is long enough to prepare the reader to warm up to the topic and familiarize him with the problem, but not too long that it discusses the main topic too early. It does give an idea of how the findings of the study can contribute to an understanding of how behavioural factors can impact on the effectiveness of ACBM. The reader can therefore proceed in an orderly fashion since the introduction provides the manner in which the study is organized. It is also appreciated that the language used by the writer of the article is direct and not overly difficult to follow. There is a slight drawback to how the article is written, but it is something that appears to be a common style among academic articles. The first paragraph is a discussion that is littered with citations among the text that tries to convey substantial information. While this has become a common practice and is actually recommended for fear that the article’s author may be suspected of plagiarism, the persistent interruptions in the text for every sentence and half-sentence by a string of names and publication dates also creates an interruption in the thinking process of the person who is reading the paper. In some recent academic papers, the survey of literature such as that shown here in the introduction and the early part of the next section (Prior Literature and Hypothesis Development) is placed in a tabulation at the latter part of the article or dissertation, in order not to affect the development of the essence of the paper. However, this is but a comment on style and does not detract from the merits of the article. Prior Literature and Hypothesis Development This portion of the study provides a background of the important theories gathered from the collection of academic articles and the accumulated knowledge that provide basis for the article’s discussion. Early in this section, the paper mentions different behavioural aspects that have been related to ABCM. From the collection of findings of earlier studies, three hypotheses (H1a to H1d) were formulated along three factors, namely top management support, clarity of objectives, and factor of training. These are later identified as “behavioural implementation factors”. A fourth factor was identified which cannot be classified among behavioural aspects, which is financial success. What the study fails to explain in this portion, however, is why, among all the behaviour factors that have been surveyed in the study, only the three have been chosen. It is possible that these exhibited the most robust relationship, or that they had the most significant showing among the widest application industrywise, but we are not informed of this. There is therefore some need to justify, with more indepth explanations, what the variables mean and how they are applied in the study. One note about the other variables not considered as factors for hypothesis formulation is the designation “nonaccounting ownership” of the system, and attributed to Cooper et al., 1992. This factor is only vaguely and very ambiguously explained in the sentence that follows the statement where it is first mentioned, which even a moderately adept reader would fail to understand. Nonaccounting ownership was mentioned as a component of clarity of objective, which is difficult to comprehend for lack of explanation on the former. As for the financial success variable, at least the choice of this as the fourth explanatory variable was explained in the study by the fact that financial success being the factor that would most interest majority of commentators. While it is a useful piece of information as a commentary on the profit-enhancing possibilities of ABCM, the hypothesis itself has no bearing on either cognitive or affective conflict. Whatever the finding associated with this hypothesis, therefore, would not either advance nor hinder the purpose of the study, but it would be an additional embellishment that would be appreciated by the reader. After describing the variables selected, the constructs for conflict and ABCM were grounded on theoretical discussion. The generic path model was a helpful graphical representation that aided in the understanding of the study’s framework. The differences in constructs for affective and for cognitive conflict shed light on the possible bases for a divergence of findings between them. On the bases of these explanations, the next two major hypotheses (H2 and H3) were constructed with sufficient bases, that is, a thorough description of cognitive and of affective conflict were provided. Subsequently, the last two hypotheses (H4 and H5) were likewise explained, with the use of the aforementioned attention to behavioural implementation factors tested in H1a to H1c. The change in orientation of the hypotheses is noted, that is a positive association is tested for cognitive conflict and a negative association for affective conflict. The study drew these insights from pre-existing academic literature, and at this point there is no reason not to accept the hypotheses as reasonable test measures. Thus, the theoretical grounding of the study is considered satisfactory. Research Method In this section, a description of the sample for consideration, the measures used for analysis, and the manner the test instrument was administered were discussed. The sampling theory employed made certain that a representative sample of the target population was obtained, through the help of data acquired from three large professional accounting companies. From the list of organizations thus provided, eighteen large manufacturing organizations were selected which had just introduced ABCM in their systems within the last 18 months before the research date. This criterion is adequate for the firm to still be in the introductory stages of the ABCM approach, but not too recent as not to have discernible results for the purposes of the study. Suffice it to say that within the interim of a few months, there would have materialized some effects of the introduction of the innovation for them to be measurable, if they ever will be. The data gathering instrument was a survey questionnaire administered to senior managers who were considered by the researcher and the subject’s organization to be the most knowledgeable among the managers in their organization concerning the implementation of the ABCM. This qualifies them to be competent to respond to the administered questionnaire. Thus it is a necessary assumption that the senior managers accomplished the questionnaires, truthfully, with deliberation, and of course with understanding. In the course of selecting samples, it was admitted in the study that the possibility of bias is present, in the favourable attitudes the respondents had to ABCM. The study admitted that it had no direct controls for such bias; we deem therefore that this may be a material consideration when evaluating the results of the questionnaires, that there exists an inherent bias in favor of ABCM among the respondents. At least, with this uniformity in bias, the tests would need to detect with greater sensitivity variations within groups. The response rate, at about 88%, is more than satisfactory for a representative sample. The profile of the respondents was provided in the study, which is a helpful addition in regarding the subsequent results of the survey scores. The respondents did not identify their parent firms, which, while understandable because of the confidentiality condition, would preclude a grouping of responses among firms, which would have provided an interesting basis for comparison. All the same, not grouping according to companies will not necessarily detract from a proper solution to the research question, for as long as the researcher ensures that there are no undue biases created by some companies being better represented than others (because of unreturned questionnaires) and thereby skewing the representativeness of the data obtained. In the discussion of measures, the validity of the survey questionnaire was ascertained prior to administering of the instrument to the actual test respondents. This is a vital step for the gathering of reliable data through survey, and its inclusion here is a plus factor for the research. Also, the use of a 7-point Likert scale (where the response ranges from 1 to 7 depending on the degree of the respondent’s perception of the question, is appropriate because the greater number of possible responses increases the sensitivity with which the instrument records the respondents’ scores. The use of a 7-point scale, however, allows for a median answer corresponding to neither high nor low. It is thus prone to central tendency, or “the reluctance of respondents to use extreme positions” (Brace, p. 75). Thus, the study may have been better benefited by either a 6-point scale, or for greater sensitivity, an 8-point or 10-point Liker scale. Where the choices are even, then the respondent will have to decide, where he would tend to “middle,” whether he leans more towards slightly lower or slightly higher, thus increasing the chances that a significant mean score will be obtained. However, inasmuch as the scale was merely adopted from an earlier study by Jehn (1994) and Amason (1996), then it is considered acceptable for consistency and comparability with earlier studies. The summary of factors in tabular form in Table 2 (p. 30) is well appreciated, in that it facilitates comparison of mean scores among the factors. It would have been better, however, if the nomenclature for the factors were made unique for each factor, in order to weed out ambiguity and inconsistencies. For instance, Factor 1: Training should no longer be repeated, as in Factor 1: Affective Conflict, or Factor 1: Product Planning. The designation would have been clarified if, for instance, the Conflict Factors were designated “Factor A” and “Factor B,” and the ABCM Usefulness Factors were “Factor X” and “Factor Y”. With such terminology, the discussions of statistical data would be smoother for use of shorter factor or variable names. However, Table 2 is much appreciated. Results The inclusion of Table 3, Descriptive Statistics (p. 31), is likewise most helpful, as providing basis for the readers to anchor their judgment of the credibility of the study, and to arrive also at their own insights that might either agree with or diminish that of the author. As for the items in the questionnaire, the reader assumes that it likewise had been adapted, or adopted, from Jehn (1994) and Amason (1996), from which the scales have been gleaned. Whatever is diminished in terms of originality is nevertheless enhanced by consistency, comparability, and the confidence that the instruments has been used before and found satisfactory for the purpose. The structural model developed in Figure 2 (p. 32) appears to be at first overwhelming, until one realized that the factors are aligned according to their levels or natures (ABCM behavioural factors, the conflict constructs, and the ABCM usefulness factors). It is interesting to note, for instance, that no significant paths connect inward to affective conflict, and that top management support does not impact either on cognitive or on affective conflict. As one studies Figure 2 more carefully, one tends to appreciate how the different relationships drawn out facilitate in the assimilation and conceptualization of the findings, and the non-statistician is at once enlightened on the importance of the factors and how they relate to each other. The data from which the structural diagram is drawn is presented in tabular form in Table 4 (p. 33), one glance of which makes it clear how much the graphical representation (structural model, Figure 2) aids in impressing the reader with the clarity and saliency of the findings. Succeeding tables proceed to the presentation of multiple regression and correlation results pursuant to the other hypotheses formulated at the beginning of the study. The same comment may be made here, that the tabulation of results aids the reader in grasping the essence of the discussion; however, the structural diagram still presents the most comprehensible format. Discussion The discussion is constructed here as an aggregate of the analysis and conclusion portion of a research study. Again, as with other parts of this paper, the discussion appears to be particularly well organized and straightforward, allowing for facility for the reader to follow through with the discussion. It commences with a review of the objective for which the study was undertaken, in order to focus the direction of the discussion. It proceeds to a review of the theoretical basis and the method of research, before continuing on to a summary of the findings. The discussion followed through with the results of the study, drawing their meaning from the statistical jargon and interpreting them in the language of management and behavioural science. What is particularly helpful to the reader is where the discussion identifies in straightforward terms the contribution the article makes to existing literature. In general, the study support earlier literature on ABCM, although slight discrepancies are discovered which the author of the article attributes to slight differences in sampling and statistical analytical approach. In general, however, the broad findings are consistent with past studies. The novelty of the article lies in the relationship it establishes between conflict and outcomes of ABCM implementation, in the short term (introductory phase). Of the factors, top management support appears to have particularly potential implications for the practical managers and practitioners. Aside from all the significant relationships established it is interesting to note that the article found no significant effect of any of the factors (implementation, cognitive conflict or affective conflict) with financial success. This finding could provide the premise of a new research, because of the importance of financial success to the viability of any organization. It must be noted that ABCM is an innovation which, as the article mentioned at the very beginning, provides “improved information for strategic decisions such as product planning and cost management” (p. 19). If the organization fails to realize improved earnings or, more importantly (since this is a cost management strategy), lowered costs, then there may be no purpose in ABCM if it tends to exacerbate either cognitive or affective conflicts among the organization’s human elements. In such instances, it may thus be of no surprise that “while ABCM has been increasingly adopted there is evidence that, for some organizations, promised gains have not eventuated” (p. 19). Maybe, in light of the finding of no effect on financial success, the study should have been designed to separate those respondent-managers whose organizations experienced financial success after implementation, from those which did not. Or, it might be possible that financial success is not yet experienced because the ABCM system has just been recently introduced (within 18 months of the study) and therefore would not yet have reflected any particular efficiencies in the organization’s operations which may be measured by financial figures. Comparison to another article There was difficulty trying to locate another article with an empirical approach that dealt with the implementation of ABCM, much less relate it to factors pertaining to human behaviour. There is, however, an article that deals with ABCM, entitled “Application of Activity-Based Cost Management: A Descriptive Case Study” which is written by Michael T. Brandt, Steven P. Levine, and James R. Gourdoux. It was published by the American Society of Safety Engineers in its January 1999 issue. As the title implies, it is a case study which focuses on one particular company, thus it is not susceptible of yielding findings suitable for generalization. A case study focuses on the particulars, maybe unique to the organization, however it is capable of providing deep insights into the subject matter (Yin, 2009). In this study, the central topic is the implementation of ABCM itself, thus the focus is on the special attributes and requisite processes involved in ABCM and how they contribute to the improvement of decision making in the company. Aside from methodology, the article by Brandt, et al. (1999) is a slightly earlier study, preceding the article by Chenhall by five years. The context may not therefore be very different. Its attention is more closely focused on the service industry rather than the manufacturing industry to which Chenhall caters. Furthermore, like Chenhall, Brandt et al. discusses a human component of the organization in relation to ABCM, but rather than behavioural considerations, Brandt et al looks at the safety consideration. We find the article by Brandt et al more practical and applied, and it presents much data on the financial advantages of adapting ABCM. Therefore, while both studies are on the implementation of ABCM and its effect on human resources, there are substantial differences to their methodologies and their findings. We learn from this comparison that research can be very diverse and, within the conditions they were undertaken and the assumptions they make, each of these research studies can be correct. When reading research articles, it is very important not only to read the findings and conclusion, but also the methodology and framework, so that we know the constraints under which their findings are relevant. 1.3 Implications for Management Accounting The study by Chenhall (2004) has significant implications in the practical application of management accounting. As other studies support, ABCM has strong potential for enhancing decision making through the monitoring and reporting of costs based on activity. It improves the quality of information provided to management. In introducing the ABCM system, there are bound to be conflicts, but this article has demonstrated that not all conflicts impact negatively to the organization. Care should be taken to distinguish between actions that yield cognitive conflicts, and those that produce affective conflicts. A major finding is the degree to which top management support significantly affected cost management in the structural model; however, there is no relationship between top management support and the two types of conflicts. This is explained by the study by the relatively minor role top management plays in the tactical and operational implementation of ABCM. Top management deals with the strategic, the macro-considerations. For this reason, the cudgels fall on middle managers and supervisors to ensure that conflict situations are kept under control. Middle management would do well to try to comprehend the nature of the conflict construct, and how each of the ABCM implementation factors work to affect these conflicts. Finally, for this paper at least, it should be noted that a caveat tails the discussion/ conclusion portion. There is no assurance that among the companies sampled, there was uniformity of the importance of accounting innovation in their information and decision culture. This is a vital qualification of this paper. If in a good number of companies sampled, the information and decision-making functions are relatively centralized and contained in one or a few units, then there are few implications on the production function in case a change of accounting method is adapted. However, in firms where the information and decision making culture is strong, then the shift to ABCM may significantly affect production, and conflicts are more likely to be encountered. 2. Suggestions for improvements The research study can be improved by revising the sample to be more stratified, or to limit the nature of the firms depending upon their product or decision-making culture. It may also be useful to distinguish those companies which have a positive financial result and those for which the financial situation has not changed. The survey questionnaire, as already mentioned, could have been made more sensitive by using an even-numbered response Likert scale to eliminate central tendency among the respondents. Also the items in the questionnaire could be reviewed for greater relevancy to the respondents, given the context of their particular organizations. A further suggestion is to further operationalize the discussion by providing a link to real-world situations. Concepts such as “nonaccounting ownership” and other terms used in the study are not readily clear and beg to be given an operational context. On the whole, however, the paper is well organized and a sincere attempt was made to make the discussion comprehensible to the average manager. The paper should be followed up by subsequent studies linking ABCM implementation to financial success. 3. Description of the planning of your analysis of the research paper The analysis of the research study was done section by section, because this method would greatly aid the person reading this article how the discussion is situated at any point in time. It would be more difficult to jump about in the article. Also, it is an aid to us, the group, as analysts because it helps us focus on one aspect of the study at a time. Besides, discussing section crystallizes the issues as they developed, so that the issues may be measured against succeeding sections. The sources this analysis used are articles from academic and professional journals, the major article (Chenhall) from an accounting journal, the secondary article (Brandt, et al.) from an engineering journal. Books were also referred to for some issues on research theory. The timetable for the critical analysis project is shown below. Time to complete Activity Objective / End Result Date of completion Library search To choose an article for analysis Group discussion To plan how the article is to be written Writing of the text To divide the work and execute the plan Group discussion of content of first draft To coordinate the different parts and determine improvements Rewriting of the text To revise according to the improvements Group discussion of revised draft To review the final work and make refinements Presentation To deliver the report 4. Bibliography Brace, I 2008 Questionnaire Design: How to Plan, Structure, and Write Survey Material for Effective Market Research, Second Edition. Kogan Page Limited, London. Brandt, M T; Levine, S P; & Gourdoux, J R 1999 “Application of Activity-Based Cost Management: A Descriptive Cast Study”, American Society of Safety Engineers, January 1999, pp. 22-27 Chenhall, R H 2004 “The Role of Cognitive and Affective Conflict in Early Implementation of Activity-Based Cost Management.” Behavioral Research in Accounting, vol. 16, pp. 19-44 Yin, R K 2009 Case Study Research: Designs and Methods. Sage Publications. 5. Reflective Summary This project involved the critical analysis of a published research paper. In the beginning, the group felt that it was an activity that was beyond our capability to do. We regarded the academic material as a very authoritative one, and to critique it would be a challenge for us, being mindful of the fact that all comments must be supported by good reason based on solid theory. However, just at the very first step during a search for articles, we had been exposed to a great variety of written material. This has impressed upon us that the theories we learn in our course are still constantly developing, and one day, after we had gained more knowledge and much more experience, maybe we could get to write the new developments in this same field. For now, we are appreciative of what we had learned about the interface between such a specialization as activity-based cost management, and accounting innovations in general, and the human resources aspect of the organization. It is easy to separate the theories on these; however, the proof will still be in the application, where diverse fields such as accounting, human resources, finance, production, engineering, and marketing will become integrated in a single human endeavour – the creation of goods and services to satisfy human wants. In this context, the theories we have learned will provide a great deal of enlightenment for us as new, and maybe better, managers. Read More