Career development in management accounting: empirical evidence

1. Introduction

The world of work is undergoing a comprehensive process of change. Influencing factors such as globalization, economization, digitalization and the structural shift towards a service and knowledge society are resulting in more complex and dynamic professional careers (Barley et al., 2017; Hirschi, 2018; Aroles et al., 2019). This “new” working world is characterized by a decrease in the continuity and stability of careers as well as an increase in their unpredictability and flexibility across most professional groups (Akkermans and Kubasch, 2017; Atanasoff and Venable, 2017). However, despite a consensus in the academic literature about the trend of previously typical traditional organizational careers (e.g. straightforward hierarchical development under organizational responsibility in only a few organizations) being replaced by a diversity of “new” career models (e.g. geographically and socially mobile, flexible and proactively self-responsible individuals; Arthur, 2014; Cortellazzo et al., 2020), empirical evidence for professional groups in the field of management and business is lacking (Alonderienė and Šimkevičiūtė, 2018; Redon, 2021).

Many of the functional areas in firms are affected by these changes and have thus received increased academic interest. Recently, management accounting (MA) has faced a particularly high degree of change; ongoing megatrends such as digitalization and academization have led to substantial changes and will continue to gain importance (Lasyoud and Alsharari, 2017; Heinzelmann, 2018; Rikhardsson and Yigitbasioglu, 2018). In addition, several changes are emerging within MA. An extensive number of publications of this topic has investigated the impact on MA at the organizational level (e.g. the changing role from bean-counters to business partners and data scientists; Oesterreich and Teuteberg, 2019; Wolf et al., 2020) and at the individual level (e.g. changes in the required competencies; Lawson, 2019; Leitner-Hanetseder et al., 2021a). Based on these considerations and in line with recent articles (Rose, 2017; Schäffer and Weber, 2017; Leitner-Hanetseder et al., 2021b), we assume that disruptive changes in MA careers are occurring.

However, in the academic discourse, careers in MA have only been treated in an unstructured way. In addition, in view of the current changes in MA, individual sub-aspects are receiving increasing scrutiny, but their effects on careers have so far been given little research attention (Lukka, 2007; Rikhardsson and Yigitbasioglu, 2018). Publications in the practice-oriented literature often rely on a normative framework without corresponding datasets (Connelly and Burrage, 2009; Rose, 2017). In summary, the state of the art largely lacks a holistic consideration of careers in MA. Moreover, theoretical conceptual contributions on careers without a focus on MA (Inkson et al., 2012; Lee Cooke and Xiao, 2014) do not allow any conclusions to be drawn about careers in this profession, which is characterized by specific features and must be examined separately. Hence, to the best of our knowledge, a holistic analysis of career models in MA and a subsequent in-depth analysis of the relevant influencing factors are largely lacking. Consequently, further empirical evidence for the field of MA is necessary. Hence, we derive the following research questions:

1. What findings does the literature provide on career development and career-relevant influencing factors in MA?

2. Which individual career-related factors influence careers in MA?

The contributions of this study are manifold. Our empirical study provides relevant insights into careers in MA for academia and business practice. The findings shed light on the under-researched question of how professional careers in MA proceed and develop. Moreover, by analysing the careers of the graduates of a department offering an MA major at a German-speaking university, spanning the past 30 years, empirical evidence of career changes in MA can be identified. Further, our results may help companies handle MA-specific issues regarding human resources (e.g. talent management, vocational training).

2. Theoretical background

3. Literature review

In line with recent articles on accounting research (Khlif and Achek, 2017; Fontenelle and Sagawa, 2021), we conducted a comprehensive literature review primarily based on a keyword search in several databases and search engines and a subsequent forwards/backwards integration. We included all articles, books and book chapters in English or German that focus on professional careers in MA without a time restriction. This brief review indicates a general dearth of research on careers in MA as well as the supposed change in careers and their influencing factors. Only a few studies deal explicitly with careers in MA (Weber, 2008; Amato, 2016; Rose, 2017). The state of the art shows great heterogeneity in terms of the general orientation and purpose of publications (e.g. academia and practice), research interests (e.g. focus on selected facets of careers), delimitations of occupational groups (e.g. conflation of MA with accounting or chief financial officers (CFOs)), theoretical background (e.g. career models) and methodology (e.g. single case and large-scale quantitative empirical studies). However, substantiated knowledge on careers in MA is lacking, as are empirical studies and conceptual considerations of career paths, path dependencies and characteristics. Indeed, several publications in the practice-oriented literature are based on normative assumptions and lack empirical considerations (Connelly and Burrage, 2009; Rose, 2017).

Schäffer and Weber (2017) postulate that traditional organizational careers in MA have ended due to digitalization, standardization and shared services. These developments are leading to a visible change in careers, with the “chimney” career common in MA (i.e. a straightforward and hierarchically ascending career in a single occupational field) in particular being replaced by new models (Schneider, 2013; Weber, 2013; Schäffer and Weber, 2017). Weber (2013) highlights that the field of MA is therefore a good foundation for rising to the top hierarchical levels of firms (e.g. CFO). For this reason, several studies analyse management accountants' rise to becoming CFOs. However, careers in the future are expected to adapt to those models common in Anglo-Saxon regions (e.g. autonomous, less straightforward and alternative development models), which are broadly classified as protean career models (Rose, 2017). In this process, management accountants, particularly CFOs, will make their own career decisions and prioritize their career progress (Connelly and Burrage, 2009; Amato, 2016).

This general transformation within MA could be resulting in significantly more diversified career paths and changed career goals up to management positions (Schneider, 2013). Lambert and Sponem (2012) find that younger management accountants are now striving to achieve subjective success criteria such as job satisfaction to give themselves higher professional mobility. Moreover, while women within the accounting and financial field tend to prefer a stable career, a high degree of flexibility in other occupations is evident due to the working environment (e.g. part-time hours; Zarei et al., 2021).

Alonderienė and Šimkevičiūtė (2018) describe a shift towards proactive and self-developed career management in MA and finance due to the changing market conditions, which is shaping protean and boundaryless career attitudes, especially among younger employees in junior positions. As a result, these individuals tend to change firms or jobs more frequently, with no dominant career paths emerging (Baker and Phillips, 1999). Using a qualitative empirical approach based on the careers of heads of MA German firms, Weber (2013) shows that career paths to this position vary greatly. Despite this great heterogeneity and diversity of career paths, Weber (2013) clusters them into four types defined solely on the content of the job description: 38% of the sample correspond to financial allrounders, 38% to MA specialists, 14% to managers with business responsibility and 10% to reporting specialists. The decision to select each cluster mostly relies on the individual preferences of employees.

However, in principle, more frequent changes of employer lead to reaching management positions more quickly (Cappelli and Hamori, 2005). Schäffer et al. (2008) show that today's CFOs change employers and industries much more frequently than previous CFOs, indicating a change to new career models. Accordingly, Weber (2008) finds significantly divergent career paths for CFOs, particularly in MA, rather than uniformly stringent development. Smith and Sheridan (2006), however, postulate that the unique characteristics of professional positions in finance and MA provide an ideal environment for maintaining a traditional organizational career. Reaching career plateaus is strongly influenced by career perceptions and associated goals and may also be the starting point for realignment. In a qualitative empirical study based on interviews in accounting, Smith-Ruig (2009) shows increased demand from employees for career path support from companies, suggesting that organizations take responsibility for career paths in line with the traditional career model.

4. Empirical study

5. Discussion and conclusions

Our literature review shows a heterogeneous picture and a substantial research gap on this topic, since only a few studies deal explicitly with careers in MA (Weber, 2008; Amato, 2016). However, the state of the art indicates the disappearance of the “chimney” career that was once typical of MA. Trends such as digitalization, globalization, standardization and individuals‘ changing understanding of careers are leading to the implementation of less straightforward or alternative career patterns (e.g. new career models). Several authors attest to the fact that MA follows the protean or boundaryless career models, as evidenced by proactive career management, subjective criteria such as job satisfaction and more frequent career changes (Amato, 2016; Schäffer and Weber, 2017). The previously stringent and vertical career development in MA seems to be giving way to successive dynamic careers with multidirectional progression although the characteristics of financial professions support the characteristics of traditional organizational careers. The key career predictors arising from the literature review include the frequency of changes in companies and industries; firm size (operationalized by the number of employees); the type, number and temporal distribution of long-term on-the-job training and the type and number of networks and mentors.

Our quantitative empirical study addresses the research gap by analysing a dataset of graduates’ careers. We find that the importance of a proactive external presentation of one's own career (e.g. on social networks) is increasing among younger graduates compared with older graduates. This finding indicates the tendency towards the adoption of new career models (e.g. proactive career management and importance of external networks), and it is supported by the breadth of current positions and occupational groups within the sample, especially among the two youngest clusters. In detail, these groups are characterized by more frequent lateral career moves and shorter retention periods per position, although these are not universal, but correspond to the qualification of university graduates.

Our qualitative interview data confirm that careers are becoming more dynamic. In particular, these new careers in MA are dominant in large and internationally oriented companies and even strengthened by the personnel supervisors responsible for MA. Accordingly, the existence of highly fluctuating jobs is considered to be natural in MA, with the traditional view of loyalty-based employment, as described in large parts of the literature, increasingly being displaced. In addition, the possibility for short (i.e. up to one year) career breaks (e.g. sabbaticals and other employment) is considered as enriching, and such breaks are increasingly promoting careers in MA. This corresponds to sideways steps under new career models. However, they remain uncommon in practice. By comparison, older graduates show a more consistent picture with regard to current positions; however, adequate longitudinal data to confirm this are unavailable. Nevertheless, this trend across clusters suggests non-vertical and flexible careers characterized by on-the-job learning and cross-organizational reorientations, as per new career models.

In summary and in line with the literature on professions in the financial sector (e.g. Weber, 2008; Smith and Sheridan, 2006), the most – and only significant – influence on hierarchical advancement is professional experience. Accordingly, in our sample, hierarchically senior positions (e.g. CFO and managing director) are filled by older graduates and classic entry-level professions (e.g. junior management accountant and tax consulting trainee) by younger graduates. The interviews show that most management accountants have at least a rudimentary idea of their next career steps in terms of hierarchical development. Interestingly, an external labour market move is often being considered beforehand. However, internal organizational forms are also subject to change, mixing functional areas and teams and thus opening up new career paths for management accountants. From an organizational perspective, matrix and project structures that lead to intra-company mobility are displacing traditional career models, even though the employer is unchanged. In line with the findings of Lambert and Sponem (2012), high mobility in the field (e.g. management accountants responsible for production with several years of experience directly in production) advances hierarchical development, since it demonstrates that management accountants can deal with the complexity and different cultures of other professions. The latter is considered as particularly essential for future career advancement owing to the coordination function of MA.

The interviews show that the career success criteria of MA are transforming. For younger management accountants, the central criterion for career success is no longer objective career goals, but increasingly subjective criteria (e.g. job satisfaction). In addition, the changing work profile, its professional challenges (e.g. due to digitalization), and one's own contribution to the company can be perceived as more fulfilling than holding a management position. To meet this changing understanding, management accountants therefore strive for more presence and visibility in the organization, which thus moves MA closer to management and leadership authority. This contradiction between traditional and new career models is rarely perceived by management accountants. Thus, objective career goals may remain, but justified at a substantive level.

Since the current generation of heads in MA largely pursues objective career goals, any generational tension in the understanding of careers must be consciously moderated. Our interviews revealed a rising tension between one's profession as a management accountant and one's role as an employee of an organization, with the profession becoming increasingly prominent among younger management accountants. In addition, the willingness to switch to other functional areas is increasing. The qualitative data explain that such an unstable career environment prevents loyalty to employers from forming. By contrast, older management accountants have higher attachment to their employer, associated with an increased willingness to accept labour market changes. Therefore, the changes in the career context are seen by management accountants as an opportunity rather than a risk.

The data indicate that graduates with managerial or staff responsibility have received further training in MA, which could be categorized as a prerequisite rather than a career-enhancing measure in the narrow sense. The interviewees mention a wide range of further qualifications. For instance, classical IFRS and other accountant examinations are considered as “classic” in MA, but not a requirement for today's career starters. Instead, our findings indicate a changing trend in competencies and thus further training. Further accounting-specific training is increasingly being replaced by either generalist training programs that offer a holistic understanding of business administration or more technical training for, say, data scientists. Thus, further training best demonstrates the interaction between the perceived change in MA and shift towards new career models. Therefore, our study helps explain career development in MA (e.g. Järvenpää, 2007).

The interviews confirm the results of the quantitative study, showing that no universal educational path in MA exists. Instead, the required skills are broadening in response to MA careers rising in dynamism and thus speaking against a “chimney” career. Indeed, further training in MA is moving more in the direction of generalists than specialists. However, still no consistent pattern towards further education has emerged. The focus of further training in MA is also shifting towards training that can be deliberately used in different firms, industries and professional fields. The need to adapt to the career environment fosters the development of key skills that can be used across organizations and professions (e.g. social skills). Thus, management accountants no longer necessarily focus on achieving a career step by using further training, but rely more on subjective criteria such as developing their role in the company. For example, after taking a junior position in MA, interdisciplinary training is becoming more important than specialist training. In particular, the interviews show that heads of MA rarely receive further training in MA and rely on less specific educational measures (e.g. training in personnel management). This is where a specialist career differs from a management career. Interestingly, international further training is not yet found among heads of MA, but to a greater extent only from the next career level (e.g. CFO).

However, the practical knowledge necessary for the tasks of a management accountant remains important, especially in large firms. Moreover, further training is increasingly being shifted from formal institutions to in-house on-the-job training. In the future, firms will be called upon to offer much more. If this trend continues, in the medium term, firms may need to align company-specific requirements with the cross-company demands of management accountants. Further, this may diverge between the management accountants in SMEs and large firms due to differences in teaching resources.

With regard to specific IT skills (e.g. Leitner-Hanetseder et al., 2021a), the general technical development and related adaptation of the curricula are also reflected in the results. The often-postulated assumption that IT skills are important for career entry after graduation (e.g. for junior positions in MA) is suggested by the explicit naming of specific IT skills in social profiles. However, the relevance for later career progression, particularly with increasing hierarchical progress (e.g. for management accountants with management responsibility), decreases significantly owing to the displacement of IT and ERP-supported routine tasks from everyday professional life (e.g. for CFOs). This is in line with our interview findings, which provide evidence that digitalization is leading to a shift towards greater analysis. Thus, logical and networked thinking as well as cross-functional business competencies are becoming more prominent and replacing the trend towards specialization. In other words, basic accounting knowledge (e.g. accountant’ examinations and accounting standards) is tending to decline or be substituted by digital skills (e.g. data literacy). Despite the volatility of careers, a basic understanding of management remains indispensable and cannot be replaced or partially covered by ERP systems. Going further, our interviewees expect IT-savvy management accountants to move closer to middle or higher management. The interview findings complement the quantitative data, showing that IT skills are most important for entry-level positions in MA. From this, we can deduce the expected career change. This will open up MA to people from outside the field to enter and enable career development towards general management. In line with Heinzelmann (2018), a change in competencies in MA due to digitalization and IT systems may thus lead to a new perspective of quality work in terms of job satisfaction. Further, our results show that career paths are influenced as well as the identity of the profession being shaped. Although a change in required competencies must not be confused with a change in careers, both indicate the implementation of new career models, in line with Arthur and Rousseau (1996) and Hall (1976, 1996).

New career models postulate an increasing importance of networks for individual career design (Arthur and Rousseau, 1996; Baruch et al., 2015). However, the quantitative sample covers mostly alumni networks. Due to the self-representation of graduates in social networks, the picture is distorted and informal networks that actually promote careers may not listed. This is confirmed by the qualitative interviews, which mainly show the relevance of informal networks to career development. The actual influence of this variable on leadership positions thus remains open in the quantitative data. Nevertheless, the data indicate a higher importance of networks among younger graduates, as they typically have more networks than older graduates despite their significantly less work experience. While the interviews confirm that the high use of networks does not correspond to having vast professional experience, the explicit use of networks for career advancement is evident in our sample. Company changes often derive exclusively from network members proactively contacting management accountants. Traditionally, these changes are justified by advancement in traditional career models (e.g. monetary incentives), although subjective career goals are increasingly decisive (e.g. taking on challenging projects). From a company perspective, vacancies are often filled by those people with whom contact already exists.

The interview data indicate that efforts to increase the visibility of careers within MA are growing rapidly. This higher visibility within the company as well as in external networks is crucial to respond to the increased pressure to adapt to the environment as well as one's own desire to change. This is justified to keep careers flexible with respect to trend-related changes (e.g. fast-moving careers), on the one hand, and subjective career goals, on the other. The interviews show that management accountants with strong communication skills use their networks to manage their careers. With advancing globalization, networks are also becoming more international, leading to new and expanded opportunities for career development. The interview data thus provide evidence that Austrian management accountants use networks explicitly for their career development.

The presented results show the continuation of traditional careers in MA, as indicated by both the quantitative data and the qualitative data. However, there are indications in the sample that career changes are afoot (e.g. the number of company moves), in line with previous findings that classic career patterns in MA will be replaced in the future (Schäffer and Weber, 2017). Thus, it is assumed that the continuation of the development described in theory and empirics can lead to changes in career paths in MA (e.g. diversified careers and career goals) as well as proactive and self-responsible career management. However, the evidence provided in this study is insufficient to conclusively support or refute a definite trend towards changing careers, particularly as we did not consider non-quantifiable factors. Thus, the results do not allow us to confirm the evidence of theory-based career models (i.e. boundaryless and protean career models).

A number of implications for corporate practice emerge from the findings. Within MA, career goals (e.g. work/life balance) are being reconsidered and management accountants are gradually moving towards new career models. However, this development only applies to MA itself and is different compared to other corporate by the departments in a firm. Although the use of traditional career models is declining, MA remains closer to the traditional organizational understanding of career than other departments due to traditional-organizational specific of MA (e.g. objective career goals), while weakening, remain more pronounced than in other areas. Sensitivity regarding this distinction is important for human resource departments, as they deal with all the employees of the company and are thereby intensely challenged, especially given the current labour market.

Regarding talent management, the different career contexts of SMEs and large firms might shift in response to the changing requirements of management accountants. The prospect of hierarchical advancement and international assignments abroad in subsidiary companies may be attractive to management accountants. Further, with regard to further qualifications, it appears important for companies to offer management accountants more generalist or IT-oriented courses in-house; educational institutes are already responding to this and adapting their portfolios. Companies must also respond to the increasing importance of networks, including the use of both formal and informal career networks for recruiting.

Our findings may also advise practitioners working with management accountants following new career models, as they highlight the need for companies to offer appropriate opportunities in MA. Personnel consultants are gaining importance by anticipating the changing career requirements of younger management accountants and preparing them in companies. Contrarily, for companies, this development is only just beginning. Since personnel consultants have a good overview of the MA labour market, they could be invited by companies to explain perceived career development. Having an awareness of career models is especially relevant for high potential talent in such a rapid changing and highly competitive international labour market. Companies must proactively address this development to remain an attractive employer for management accountants. The disproportionate adherence to traditional career models, beyond the discussed specifics of MA, appears to be disadvantageous to competition given the current development of the labour market. Thus, it seems important to anticipate the emerging trend in MA and not merely react. As personnel consultants for MA are already showing, external consultants, in particular, may help initiate this development at a broad scale.

6. Limitations and further research

Limitations of the study arise, on the one hand, from the research methodology chosen. The investigation of quantitative empirical cross-sectional data allows the status quo of careers to be depicted, but provides few conclusions about the temporal dimension and, in particular, the reconstruction or clustering of career patterns in MA. Furthermore, it was not possible to collect data on parameters such as environmental conditions and other non-quantifiable factors that underlie and influence individuals' careers. On the other hand, the limitations of the sample must be considered. The extraction of career data from social networks depends on individuals' data maintenance and could distort the results. In addition, despite a response rate of approximately 43%, the number of respondents (83) is too small to guarantee robust statistical inference. The qualitative study also faces limitations due to the explorative nature of the research design and characteristics of the sample (e.g. size and regional composition). Further interviews would lead to greater data saturation. Moreover, interviews were conducted before the Covid-19 pandemic and therefore the ongoing paradigm shift in the labour market is excluded from our data (e.g. home working and shortage of employees).

Further research is necessary to confirm our findings. Although we found new evidence on careers in MA as well as on the current state of career change, future research on this topic is needed. A follow-up study could extend the sample to include more universities with an MA major. In addition, a comparison between individual countries or areas could provide new insights. At the same time, a larger database would allow for a wider range of statistical analysis methods to be used and more detailed insights to emerge, such as a representative and anastigmatic reconstruction of career paths for certain industries or company sizes as well as a further cluster analysis of career patterns. Further investigation could be covered by a different theoretical framework (e.g. human capital theory), leading to a focused analysis of careers in MA.