Management Accounting With the Dissociations Between Rules and Routines: A Case Study

Abstract: This study aims to explore how management accounting is practiced with the dissociation between rules and routines. Based on the existing research, a dissociation between rules and routines may cause management issues. Simultaneously, several researchers argued that in the short term, management accounting may practice with the dissociation between rules and routines. However, it remains unclear whether management accounting could be practiced without regard for the dissociation between rules and routines as a problem for a long time. Through a case study, this study confirmed the importance of the founder’s thoughts (management philosophy), the knowledgeable actions of employees, and the limited importance of rules, even if dissociation exists. This study suggests that management accounting can be practiced with a dissociation between rules and routines, even if the dissociation has been in place for a long time. On that occasion, the top management should clarify the founder’s thoughts using a method such as a value or mission statement and form well-done ostensive routines. Simultaneously, the top management should make employees form performative routines based on management philosophy and ostensive routines. Rules can be dissociated from performative routines, but they must be based on management philosophy.

Key words: rules, ostensive routines, performative routines, dissociation, case study, Japanese small-and-medium enterprise

JEL codes: M49