Buy our book here.

online_advertising

When we teach management accounting we are constantly reminding our students that you cannot make decisions purely on the results churned out from the management accounting techniques.  Management accountants must understand how the business they work in operates, how the market works and any future trends within the industry.  The strategic consequences of decisions must be considered alongside any management accounting numeric information provided by the various systems and theory.

In October 2013 the Financial Times (FT) reported that digital advertising in the UK would pass £6bn, which will be a record high.  When companies like Facebook and Google are considering their strategies for the future they don’t just look at existing data, if they did, neither would have changed strategic direction to focus on digital advertising. Although Facebook’s shares dropped after the Initial Price offering they are now back on track because they knew that the future of advertising had to be on mobile devices. The FT confirmed that two thirds of mobile devices where smartphones adding to the impact of digital advertising.

Therefore, the key to being a good management accountant is to understand the techniques that we teach you, for example those within our text book but also to think very carefully about the strategic impact of any decisions made – as all we authors have said to you many times in the text book.

Sources:

Budden, R. (2013) Uk digital advertising spending up 17.5%. Financial Times. 7th October 2013

Annual reports of both Facebook and Google.

Enhanced by Zemanta