OBA, IOCM and Their Impact on Supplier Relationship Satisfaction: Inter-Organisation Cost Management and Open-Book Accounting Are Two of the Tools Being Employed by Management Accountants to Support Supply Chain Cost Information, as Well as Share and Control Cost Accounting Information

Moller, Klaus, Windolph, Melanie, Financial Management (UK)

Nowadays, supply chain optimisations usually go beyond organisational borders. To gain a competitive advantage, firms are increasingly focusing on core competencies, while outsourcing their non-core functions and activities. Consequently, organisational success has become highly dependent on the efficiency and effectiveness of their supply networks (Cooper and Slagmulder, 1999; Kulrnala et al, 2002). To address the emerging issues in supply chain cost management, management accountants needed to widen the scope of cost and management accounting. Techniques such as inter-organisational cost management (I0CM) and open-book accounting (OBA) have evolved to support the availability and effective use of supply chain (cost) information, as well as the sharing and control of relevant cost accounting information

Both IOCM and OBA are inter-firm cost management techniques that cross the organisational boundary between buyer and supplier to ensure better control of the product and supplier costs. For management accountants, these techniques are important, enabling them to expand their view on optimising costs and move the focus from their own organisation towards a more holistic view of the whole supply chain. By doing so, management accountants may avoid partial-optimal solutions in favour of an overall cost-optimal supply chain design (Cooper and Slagmulder, 1999).

While IOCM refers to firms' joint efforts to reduce costs, OBA involves the exchange and/or disclosure of cost-relevant …

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Publication information: Article title: OBA, IOCM and Their Impact on Supplier Relationship Satisfaction: Inter-Organisation Cost Management and Open-Book Accounting Are Two of the Tools Being Employed by Management Accountants to Support Supply Chain Cost Information, as Well as Share and Control Cost Accounting Information. Contributors: Moller, Klaus - Author, Windolph, Melanie - Author. Magazine title: Financial Management (UK). Publication date: October 2012. Page number: 54+. © 2009 Chartered Institute of Management Accountants (CIMA). COPYRIGHT 2012 Gale Group.

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