Developing Management Technology via Action Research: An alternate form to demonstrate the Operational Performance in the Variable Costing

Abstract

Admitting the Action Research as a research strategy which includes the generation of empirical knowledge base, this paper makes use of such a strategy to explore the thematic use of cost information for decision-making purposes. The present study was conducted in a large department store. The problem situation which required the development of management technology presented pointed to the need to monitor the results of departments and, concomitantly, generating activity volume information. The Variable Costing and Direct Costing were considered previously available solutions in the literature. The theoretical concern was how to improve the information about contribution of cost object to the formation of income for the Costing Variable when the spending structure has a representative presence of direct/linked fixed costs? An alternative way to demonstrate the result was developed from the Variable Costing, generating a Liquid Contribution Margin (LCM) as intermediate result in the determination of income. This study contributes to both the political justification for the use of action research and in understanding management technologies as theoretical game-language that goes for managerial action.