Cross-functional Interface of Marketing and Accounting: Value Chain Analysis

For competitive reasons, many business organizations are becoming more flexible in their operation and crossfunctional in design. Increased emphasis on satisfying the final consumer has led businesses to recognize that value contributions, from internal and external organizational members in the value-chain, are necessary to efficiently and effectively reach expected levels of customer satisfaction. This broadened cross-functional and networked perspective has placed greater emphasis on the role performed by all components in the value-chain. Several changes in marketing such as an emphasis on data-based marketing, a value-added focus, a market-response orientation, and accountability of marketing effort are critical components of this broadened perspective. Additionally, several changes in management accounting such as the use of activity-based-costing, focus on strategic cost management, and target-costing have come together to make this integrated perspective possible. This paper explores how integration of these trends, particularly the trends of data-based marketing and activity-based-costing, can improve customer satisfaction and lead to longterm competitive advantages.