The Relevance of Strategic Management Accounting Essay

The Relevance of Strategic Management Accounting - Essay Example Strategic management can be defined as the process of analyzing various initiatives taken by an organization, involving the resources available to them and performance within their external environments. This is in a bid to realize the mission and vision of the company and its objectives through developing modes of approach that will allow the organization to realize these aspects of its business (Friedl, Hans-Ulrich, & Burkhard, 2005). Management accounting can be described as the use of various accounting information by managers of an organization to assist them in making proper decisions in situations that they may be faced with. Therefore, strategic management accounting can be considered to be a combination of these two ideas whereby management accounting is used to enhance the strategic decision making that takes place in an organization, in a bid to increase the chances of success in a business (Mulcaster, 2009). ... The management processes that take place here deal with handling the organization as a whole, including the various enterprises that it may be involved with. Corporate strategic management accounting involves the handling of all businesses to ensure that there is no enterprise that may be causing the organization to suffer a loss (Friedl, Hans-Ulrich, & Burkhard, 2005). This level of management accounting is handled by the top brass of the organization, and decisions are made by top officials within the organization, such as members of the board of directors with assistance of advisors familiar with the situation that they are facing. Business strategic management accounting – This level of strategic management accounting deals with businesses belonging to an organization on a personal level. This is to say that it handles the management (Mulcaster, 2009) of the various businesses that an organization may be involved with according to the particular needs and situations that t he business may be faced with. This level of strategic management accounting is also handled by top level management, but in this case management is of that particular business such as the company CEO and heads of departments (Armstrong & Greene, 2007). This level of management allows the organization to concentrate on their various enterprises in a manner that allows them to address the various problems that they may face on a one-on-one level that allows the involved parties to figure out the proper solutions needed to take care of the complications that may have arisen (Clinton & Van der Merwe, 2006). This is an essential practice in any organization as a chain is only as strong as its weakest link, and thus all the enterprises of an