Effect of Organizational Capital on Cost Stickiness at Indonesian Manufacturing Companies
- 10.2991/assehr.k.210531.046How to use a DOI?
- cost stickiness, cost behavior, organizational capital, intangible investment
This study analyzes the phenomenon of cost stickiness (CS) by considering the impact of the level of organizational capital (OC) on sales, general, and administration (SG&A) expenses. OC reflects technologies and business processes that allow companies to optimize resources better than other companies. Costs associated with organizational development are mostly SG&A. CS is an asymmetric cost behavior related to sales activity, caused by the resource-adjustment decisions made by management. The uncertainty of market demand influences the level of sales, such that it affects resource management and earnings performance. This research performs empirical tests on financial data of manufacturing companies listed in the Indonesian Stock Exchange (IDX) from 2010–2016. For extended CS analysis, we also use quarterly financial statement data. We find from global samples that manufacturing companies in Indonesia show anti CS behavior. In the High-OC category, using the annual data sample, the quintile (median) group showed anti-CS (CS) behavior. Meanwhile, in the Low-OC category, the annual data showed anti-CS for the quintile (median) group. In the High- (Low-) OC category, the quarterly data sample showed CS (anti-CS). This study provides insights for evaluating management behavior when managing costs and financial impacts of OC in a manufacturing company’s financial performance.
- © 2021, the Authors. Published by Atlantis Press.
- Open Access
- This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).
Cite this article
TY - CONF AU - Meriza Saguliannita AU - Christina Juliana PY - 2021 DA - 2021/05/31 TI - Effect of Organizational Capital on Cost Stickiness at Indonesian Manufacturing Companies BT - Proceedings of the Asia-Pacific Research in Social Sciences and Humanities Universitas Indonesia Conference (APRISH 2019) PB - Atlantis Press SP - 366 EP - 373 SN - 2352-5398 UR - https://doi.org/10.2991/assehr.k.210531.046 DO - 10.2991/assehr.k.210531.046 ID - Saguliannita2021 ER -