5
The engineering culture in German companies, the relative
small influence of equity markets, the separation of cost and
financial accounting, and other components of the German
business tradition form the second driver of differences
in management accounting practice. All of the aforemen-
tioned elements of German business tradition have helped
to keep management accountants and controllers close to
operations. Their Anglo-Saxon counterparts, however, have
tended to be more focused on the accounting and finance
departments. Today, a lot of large German companies talk
about a controlling community with several hundred control-
lers, while a similar management accounting community is
unknown in large UK or US companies. This has, of course,
important implications for the self-image and the identity of
controllers and management accountants. Would a manage-
ment accountant be insulted if he were referred to as an
accountant? Most likely not. Would a German controller be
insulted if he were called an accountant? Oh yes, that would
probably be one of the gravest insults you could possibly
throw at him.
Differences in national culture constitute the third driver and
add to the overall picture. Let me give you an example. In
an interview in the FAZ, the former CEO of Siemens, Klaus
Kleinfeld, now CEO of Alcoa, described relevant differences
between the US and Germany and pointed out that he finds
it much more difficult to get open dissent in an American
setting. In other words, the propensity to critique and to chal-
lenge things openly – a key element of a controlling culture
– seems to be different across cultures. Similar arguments
could be made for the other constituents of the controlling
mindset, namely transparency, open information exchange,
and thinking in mean-ends-relationships.
To sum up, it appears that the fundamental differences
between management accounting practice and the concept
of controlling lie in differences in the underlying cost ac-
counting, a closer link of controllers to operations and line
management, as well as a particular controlling mindset. Are
these differences sustainable or will global homogenisation
take hold? Most likely, in a globalised economy the differ-
ences in the toolbox and national business traditions will
tend to disappear over time and, indeed, they have already
disappeared to some degree. What are likely to stay are the
differences that are due to national culture and management
accounting related mindsets. Systems and tools may be-
come increasingly standardised, but day-to-day controlling
practices will likely remain different across the globe.
