How accounting engages with the process of innovation in new product development

Abstract

This study examines accounting within contexts involving innovation and New Product Development (NPD). Within the NPD process, multiple participants and heterogeneous rationales are involved and must be coordinated. The overarching research objective of this thesis is to examine the way in which accounting engages with the rationale for innovation during the practical unfolding of the NPD process.

A review of the accounting literature for this thesis reveals a gap in understanding of the role and the impacts of accounting within contexts of innovation and NPD. Previous studies have not considered in-depth the possible interplay between accounting and the mechanisms, the relationships, and the dynamics that underpin the rationale for innovation. Examining the way in which accounting engages with the desires, intentions, motivations for innovation has the potential to contribute to the literature, to offer new understandings of how accounting practices can drive and facilitate NPD processes and, within these NPD processes, innovation objectives.

An in-depth longitudinal case study of an NPD process in a manufacturing organisation was conducted to achieve the research objective of this thesis. The material collected in the field study concentrates on the unfolding NPD practices, including accounting practices, for one specific complete NPD project. The findings of this study demonstrate how accounting, interpreted by using the theoretical concept of boundary object, sustained the process for innovation. The findings also show how accounting led the professionals involved in the NPD process to make choices and compromises during the iterative unfolding of work in progress and prototypes of the new product, interpreted by using the theoretical concept of epistemic objects. Accounting challenged the process, questioned the choices and compromises achieved and opened up spaces for reflection and discussions where new possibilities for innovation emerged within the NPD process. This thesis uses the theoretical idea of ductus to explain how accounting drove the innovation process within the NPD setting.

This study contributes to existing literature on accounting within contexts of innovation and NPD. Drawing upon a novel use and application of the theoretical idea of ductus, the primary contributions of the thesis consist in examining how accounting stimulates new opportunities for innovation in shaping pragmatic and feasible solutions within the new product innovation process. This study also contributes to the specific strand of literature that portrays accounting as having the potential to bring together and mediating among multiple parties within the NPD process. In doing so, this thesis increases understanding of the enabling role of accounting in the NPD process, given its use from a variety of participants with different backgrounds. Furthermore, the thesis advances the discussion in the literature on firmness and flexibility within product innovation settings. Finally, the contributions to practice, identified and presented in this thesis, demonstrate how embracing accounting practices may contribute to the unfolding of innovation processes within organizations.