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Top1. Introduction
The aim of this paper is to investigate the impact of managerial planning and the use of management accounting systems (MAS) on SME performance. The performance of the company has been measured in several ways in earlier literature. Arnold et al. (2010) measured organizational performance as strategic flexibility and supply chain performance. Instead Bitichi et al. (2010) measured performance as revenue growth, profitability growth, productivity or return on investments (Arnold et al. 2015; Bitici et al. 2010). In this paper the performance is measured with one of the profitability indicators EBIT/SALES. In order to get the broad picture of the performance of the company, we build our analysis on the contingency theory framework and on the contextual factors of small firms (size, strategy, environment, and organisational structure) and we also include into our research the owner managers’ role and the effect of business partners, which can both be important factors in the profitability of a company (Drazin R & Van de Ven A., 1985; Jänkälä, 2007).
Previous studies have investigated MAS in some specific industries such as new economy firms (Granlund & Taipaleenmäki, 2004), small technology firms (Laitinen, 2001), public sector organisations (Järvenpää, 2007, 2009) or restaurant chain companies (Ahrens & Chapman, 2007). However, it can be argued that the literature on the role of the management accounting of SMEs is still scarce (Garengo et al., 2005).
Managers often prefer the management systems as imperfect but adequate for the task (Ahrens & Chapman, 2007). This reduces the need for the development of MAS. Accordingly, previous research has indicated that there are often only a few, if any, systematic management control systems (MCS) or performance management (PM) tools in SMEs (Garengo et al., 2005, 41; Granlund and Taipaleenmäki, 2005; Laitinen, 2001). Contrary to this, it has also been shown that some SMEs in some industries such as high technology firms use very sophisticated MCS (Laitinen, 2001).
The data of this study, collected from healthcare companies from Eastern Finland, has many special features. The healthcare industry is a labor intensive service business. Traditionally, healthcare companies have been small companies although during the last few decades, many big national and international companies have become involved in this business. Further, in Finland, these companies often have only a few big customers such as municipal organizations. Based on these features, the healthcare industry has its own challenges to gain growth and profitability. (Rissanen et al., 2011).