Purpose – Drawing upon the resource-based view and the contingency theory, the purpose of this paper is to build and test a framework of: the interaction between market orientation (MO) and accountants’ participation in strategic decision making; and its subsequent effect on the use of management accounting systems (MASs), which, in turn, enhances firm performance.
Design/methodology/approach – The hypotheses were empirically tested using partial least squarestructural equation modeling with survey data from 171 large business firms in Vietnam. The standardized root mean squared residual value of the composite model was also examined using SmartPLS3 to test the model fit. The marker-variable technique was employed to test common method bias.
Findings – This study has two key findings: first, the use of MAS (in terms of broad scope, timeliness, aggregation, and integration) mediates the effect of MO on firm performance. Second, the degree of accountants’ participation in strategic decision making elevates the positive relationship between MO and the use of MAS.
Originality/value – This study is one of the first empirical attempts to test the contingent roles of accountants’ participation in strategic decision making and the use of MAS information in driving performance of market-oriented firms in the context of a transition market.
The traditional hypothesized relationship between market orientation (MO) and firm performance has been well established and validated in the area of marketing (e.g. Jaworski and Kohli, 1993; Narver and Slater, 1990) and strategic management (e.g. Hult and Ketchen, 2001; Morgan et al., 2009). This relationship has been proved to be positive, significant, and robust (Cano et al., 2004; Ellis, 2006; Kirca et al., 2005). In explaining this phenomenon, scholars are motivated to explore how firms possess MO and deploy this market-based asset to develop and sustain competitive advantages (Kirca et al., 2005). Then the market orientation-firm performance linkage has been unpacked and explored by various studies searching for various mediating factors connecting MO and firm performance. For example, organizational innovativeness and learning orientation are mediating factors that have been explored by scholars from the innovation and learning-based perspective (e.g. Baker and Sinkula, 1999; Deshpandé and Farley, 2004; Han et al., 1998; Keskin, 2006). Other explored mediating factors are branding orientation (O’Cass and Voola, 2011), product advantage (Langerak et al., 2004), and new products and related marketing programs creativity (Im and Workman, 2004).