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David Emsley’s Innovation Theory

Why Emsley states that “innovation is generally regarded as an important research topic”?

According to Emsley (2005), “innovation is generally regarded as an important research topic.” The author refers to the idea that innovations should help organisations in the process of adaptation to the changing business environments and survive successfully in these environments. However, the process of innovation appears to be not easy for management accountants. The inability of the management accountants to implement innovations such as ABC, for example or the balanced scorecard has been criticised and called ‘accounting lag’ (Emsley, 2005).

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However, it should be noted that when this term was coined, the area of management accounting innovation had not been explored sufficiently yet. Today, the innovations in management accounting are explored extensively, so it is not difficult to determine the connection between the innovations in management accounting and the ability of a company to adapt and survive in the rapidly changing business environments.

The importance of the innovation topic only grows, considering the pace and the depth of the changes. New technologies provide management accountants with new opportunities to collect and process data. The time needed to process information and provide meaningful outcomes has decreased significantly, so it affects the process of the decision-making and thus, speeds up the process of adaptation to the changing business environments (Epstein & Lee, 2014; Suomala & Lyly-Yrjänäinen, 2012).

The importance of innovations in management accounting cannot be overestimated today because the speed of reaction to the changes determines the competitive advantage a company may gain or lose.

Why the author is emphasising on the role for Theory development?

The role of Theory development is emphasised by the author because of the lack of previous studies in this area (Emsley, 2005). Previous studies were focused on one or several innovations (two or three the most) that were explored in-depth to evaluate their value for the management accountants. Theory development proposed by the author creates a framework for evaluation of all available innovations that can be used by management accountants in the daily practice.

The importance of Theory development is in the approach of Emsley (2005) to the process of innovations’ evaluation. The author divides the theory into three main parts and explores each to support consistency of his ideas and conclusions. The first section explores innovation as a concept, providing definition and discussing innovation as an abstract entity, without including any particular details.

In this section, Emsley (2005) provides the following definition of innovation: “an idea, practice or object that is perceived as new by an individual or other unit of adoption” (p. 160). Additionally, the author explains the most important outcomes the definition has to show that the concept exploration is a necessary step prior to exploring the practical application of some innovation concept in a real company. The understanding of the concept of innovation provides sufficient background for the further understanding of the role involvement and its impact on innovativeness.

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The second section of the theory explores the roles of management accountants and their (roles) involvement in the process of implementing innovations. This section provides an understanding of the role involvement concept and its importance for the theory. Thus, the definition of role involvement is as follows: it is the “centrality of the management accountant’s job, authority and responsibility to the comptroller’s department” (Emsley, 2005, p. 162).

The contribution of the role involvement concept to the theory is explained by using examples from the previous studies in this area that, however, are not as comprehensive as the study conducted by the author and perform only the supportive role.

The third section explores the presence and the essence of the relationship that, in theory, exists between the innovativeness and role involvement. This section evaluates the interconnection of role involvement and innovativeness and explains the terms, in which role involvement should influence innovativeness to some extent. The author divides these terms to the three sub-concepts: ”

  1. knowledge about the appropriateness of innovations;
  2. acceptance of the innovations by business unit managers;
  3. incentives to innovate” (Emsley, 2005, p. 162).

As it can be noticed, the process of exploring the potential relationship between these two concepts is gradual, and it involves the reader step-by-step to facilitate the understanding of the provided ideas.

Considering the theoretical background, provided by Emsley (2005) and other researchers, it can be concluded that the importance of the role for Theory development is very high (Hopper, Northcott & Scapens, 2007; Epstein & Lee, 2014; Suomala & Lyly-Yrjänäinen, 2012). Innovations are implemented by people who have different roles in an organisation or a company, but all these roles must have a common vision and same goals to provide the organisation or the company with the required results. These roles require different innovation but similar to or the same approach to innovation adoption.

Why is the author addressing the importance to study innovativeness?

Innovativeness is one of the main concepts explored by Emsley (2005). The author presents it as all innovations to study, opposing it to the studying of a single innovation. The previous studies were focused on the very limited set of innovations or only a single one. Such an approach was less complicated, and it was easier to understand this innovation (such as ABC, for example) in terms of implementing it in the daily practices.

Today, a single innovation cannot be a game-changer for the company seeking for success. It is highly important to implement multiple innovations and develop them within a work environment as a system of interconnected new approaches to conducting internal business operations. Otherwise, the effect of these innovations would be minimal. It is the point of the author.

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Innovativeness should be studied because it provides a more comprehensive understanding of the level of innovations a management accountant embraces. This understanding allows determining what leads a management account to the use of innovations in general.

Then, it is more important to generalise innovations and not focus on the exploration of a single innovation as ABC, for example, because factors that may be important to this innovation may be irrelevant to other innovations, so certain generalisation is needed. Finally, the categorisation of innovations is needed according to Emsley (2005), “because it opens up the possibility that explanatory variables, such as role involvement, affect different innovations in different ways” (p. 161). Summing, innovativeness’ studying is a more general but more comprehensive approach to managing innovations in a company or organisation that allows the management accountants to utilise more comprehensive and modern tools in their daily practices.

What other incentives will be useful?

Emsley (2005) states that the role of “incentives” should be considered as a positive factor in the process of implementing innovations by the management accountants. It should be noted that satisfaction from work includes incentives as an integral part, along with moral satisfaction and a salary. Incentives can be different from career growth to the salary increase and other material bonuses.

However, it is necessary to realize that incentives will not be effective if innovations are inappropriate or very difficult to implement. It means that a manager accountant most probably will disregard an incentive and will not spend time negotiating some new, improved system if it is too hard to organise its implementation because of the position of the superior manager. Summing, it can be said that ‘yes’, incentives can positively influence the process of innovations’ implementation, but their influence is not that substantial. Every situation should be considered separately to see if an incentive would be potentially effective or not.

It is possible that the ‘right’ incentives in each situation can be more effective than some general approach to management accountants in a company. Thus, for example, personalized rewards should be used to help the management accountants to focus on the innovative approaches’ exploitation in work. New technologies such as smartphone applications and cloud services can facilitate access to information.

It can make the process of the data analysis much easier if an accountant is in a distant location due to family needs, for example. Such an agile approach to the work process can motivate some employees to master innovations. Another personalized incentive could be the opportunity to work less since some improved data analysis software is capable of performing operations faster and better. Finally, even an internal competition with a valuable prize can be initiated to motivate the most active management accountants to participate. Personalized incentives should be applied in the case when it is highly important to motivate the most efficient and productive employees. It should be noted that such an approach is worthy of attention by the executives.


Emsley, D. (2005). Restructuring the management accounting function: A note on the effect of role involvement on innovativeness. Management Accounting Research, 16 (2), 157-177. Web.

Epstein, M.J., & Lee, J.Y. (2014). Advances in management accounting. Bingley, UK: Emerald Group Publishing Limited.

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Hopper, T., Northcott, D., & Scapens, R. (2007). Issues in management accounting (3rd ed.). Harlow, UK: Pearson Education Limited.

Suomala, P., & Lyly-Yrjänäinen, J. (2012). Management accounting research in practice: Lessons learned from an interventionist approach. New York, NY: Routledge.

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