The emergence of boundaries and accounting in supply fields: The dynamics of integration and fragmentation

This article analyses the relationship between management control and boundaries of firms and supply chains. We suggest that an inter-disciplinary and pluralistic approach to boundary setting, which investigates boundaries in an interpretive, functionalist and constructionist perspective is capable of capturing important aspects of the complex processes that construct, deconstruct and reconstruct firms and supply chains. Specifically, the article demonstrates the dynamics of boundary setting and relationship development through the study of a large hearing aid manufacturer and its relationships with suppliers and customers. We show how inter-organizational controls and boundaries gradually emerged in response to local interactions, learning and inter-dependencies between entities in the field. Accounting served both to integrate entities, which were internal and external to the focal firm as well as to fragment the focal firm. The article thus demonstrates the dynamics of integration and fragmentation within a supply chain and shows how firms and supply chains have multiple and sometimes contradictory definitions of identity and scope.