Table 1: Organisational responses to environmental disturbances Rebuttal Reorientation Colonisation Evolution Design archetype (these relate to Ferreira and Otley (2009) PMS) Management processes change slightly but eventually revert back to original state Management processes change Management processes are forced to change Management processes evolve significantly in response to changed interpretive schemes Sub-systems No change Changes in response to design-archetype changes Significant changes Significant changes Interpretive schemes No change No change Forced changes led by a small group of organisational stakeholders Changes occur after debate and acceptance Adapted from Laughlin (1991) Organisational responses to external disturbances may be examined by exploring whether and how the management processes (the design archetypes) change, and also by whether and how organisational members change their ideas, beliefs and values. This framework is employed later on in this paper to consider how two organisations in different sectors responded to external accountability demand changes. Research approach Many researchers argue for the use of case studies as a research methodology in the study of accounting within organisations. A key advantage of this method is that it facilitates the discovery of anomalies in extant theories by illustrating areas of difference between actual practice and current theoretical thinking (Jensen and Rodgers, 2001; Humphrey and Scapens, 1996; Llewellyn, 1996; Eisenhardt, 1989, 1991). Carlile and Christensen (2005) argue that anomalies are valuable in theory building because the discovery of an anomaly is an enabling step to less ambiguous description and improvement in a body of theory. Indeed, productive theory-building research is almost invariably prompted or instigated by an anomaly or a paradox (Poole and Van de Ven, 1989).
extent to which any changes made within the workings of the organisation may be assessed. Our analyses of the changes to the interpretive schemes, design archetypes and sub-systems in the two case studies are summarised in Table 11. Table 11: Responses to external environmental disturbances Eurel Case Study LEA Case Study Environmental disturbances New focus on shareholder values Declining profitability New Public management Declining educational performance Interpretive schemes Original beliefs and values before disturbance Preferred means of performance measurement Did the interpretive schemes change? Individuality Creativity and innovation Initially qualitative but quantitative measures forced upon organization Managers were forced to see performance in terms of share price and profitability measures Educational Relational Both qualitative and quantitative measures Officers maintained the above values and paid “lip service” to new measures Design archetypes Did the performance management systems change? Budget-system changes New quantitative performance measures adopted Focus on short term profitability Strategies and planning changes New performance measures Focus on government requirements Sub-systems Functions changes, including use of hard data to measure performance, but resentment shown New computer systems Functions changes, including use of hard data to measure performance, but and resentment Overall pathway of change Colonization led by senior management Reorientation to meet government requirements and to
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