This study aims to investigate Management Innovation (MI) Practices for Sustainable Performance of Malaysian manufacturing firms. The introduction of Management Innovation (MI) practices which included Human Resource Practices, Knowledge Management Practices, and Quality Management Practices are in expanding boundary of the underpinning theories of Resource-Based View (RBV). The growing concept of MI practices has been greatly explored it's relevance in creating competitive advantage, and thus, improve performance. The study will use Rasch Measurement Model for the purpose of analysing data, and predicting the results of 30 manufacturing firms. Out of 110 items of the instrument, Rasch Analysis has improved the validity and reliability of the instrument into 79 items. The value of Person reliability is 0.95 that is within the acceptable level of consistency of the instrument. The findings show that there are 15 firms implemented all MI practices and these firms are considered at a higher level of adaptability towards world-class manufacturing firms. The cost management is on of the most barriers of the other firms to moving forward. Then, the study concludes that manufacturing firms need to explore and exploit their dimension of MI Practices that are relevant to the Sustainable Management Accounting framework. The framework will enhance the improvement of Sustainable Performance for the sake of the manufacturing firms in Malaysia.
