Abstract
This research attempts to explore the process of change and to examine in more depth the nature of the changes in management control which accompany the adoption of the new information technologies within small and medium enterprises. In particular, recognizing that management control change is a continuous organizational process (rather than an outcome), the trajectory of which is shaped by an incessant inter-play of several influences, this research intends to explore the way in which the implementation of a new integrated information system contributes to this process. To address this issue, the current research combines theoretical and empirical insights. After having reviewed the literature on the main topics and produced a theoretical understanding to illuminate the nature of the aforementioned changes, the research relies upon an illustrative case study concerning a medium-size cooperative society based in Italy. Recognising the complexity of organizational life, the field study does not aspire to isolate and define how and by how much ICT has been a driver of the management control change, but rather to explore the whole process of change in order to appreciate the diversity of interrelated influences which have shaped its trajectory and how these influences interacted with each-other. Among this inter-play of influences, the study aims then to investigate the particular role played by the two-way relationship between ICT and management control. The implementation of the new integrated information system has opened up several opportunities for the business management and in particular for the management control. However, so far, only part of these opportunities have been exploited. Furthermore, while it could be acknowledged that the new system facilitated the changes in management control both in its material and immaterial dimensions, it could not be concluded that they were the result of the implementation of the new system. Many other factors have interacted within the process of management control change. For example, of paramount importance has been the controller’s determination to enact the change. The case study analyzes these factors and the way in which they have jointly facilitated and/or hindered the management control change.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
The relatively low amount of I.V.V. profits is due to the particular form of the society. According to the Italian system cooperatives have some restrictions about their abilities to earn profits.
- 2.
The choice to implement the standard administrative package is due to the peculiarity and complexity of the Italian fiscal and economic regulation and because it isn’t a key process for the I.V.V. success. Using a standard solution makes it easier to revise the system for the changes which often occur in national regulations: it is the responsibility of the seller to update the system in order to follow the change in the law.
- 3.
Related to this, it is important to remember the particular form of the society: in a cooperative firm where more than the 90% of the employees is also partner decisions imposed by the top-management cannot be easily accepted.
- 4.
Each group comprised a few people (the biggest one, the Production Group, had 7/8 members) and it convened one/two times a week for about 3 h (from 3:00 p.m. to 6:00 p.m.) within the span of different periods on depend the particular group. For example, developing the module to manage the bill of materials (considered the crucial factor for the company success) required about 1 year of meetings. The others were more brief. For each meeting minutes were produced. This has been important because:
-
making clear and formalizing what emerged from the meetings reduced the risk of misunderstandings (some meetings had been very inflamed);
-
the minutes maintain memory of the decisions taken during the meetings (often many days passed before one group got together again: it could cause the dispersion of some information);
-
the minutes were always read by the DA which could ensure all decisions were coherent with the goals they had been originally fixed (if they were not, the next meeting would start with the re-discussion of these decision).
-
References
Anastas M (1997) The changing world of management accounting and financial management. Manag Account (USA) 79(4) October:48–51
Archer MS (1995) Realist social theory: the morphogenetic approach. Cambridge University Press, Cambridge
Barley SR, Tolbert PS (1997) Institutionalization and structuration: studying the links between action and institution. Organ Stud 18(1):93–117.
Beretta S (2001) Unlashing the integration potential of ERP systems: the role of process based performance measurement systems. Paper presented at the 3rd Workshop on Management Accounting Change, Siena, Italy, 17–19 May.
Booth P, Matolcsy Z, Wieder B (2000) Integrated information systems (ERP-systems) and accounting practices – the Australian experience. Paper presented at the 3rd European Conference on Accounting Information Systems, Munich, Germany, 27–28 March.
Burns J, Scapens RW (2000) Conceptualizing management accounting change: an institutional framework. Manag Account Res 11:3–25.
Busco C, Riccaboni A, Scapens RW (2001) Management accounting systems and organizational culture: an institutional framework for interpreting their linkages and processes of change, Quaderni senesi di Economia aziendale e di Ragioneria, Serie interventi n. 71, Università di Siena, Siena.
Caglio A (2003) Enterprise resource planning systems and accountants: towards hybridization? Eur Account Rev 12(1):123–153.
Catturi G (2000) Cultura del controllo e gestione del segnale informativo contabile, Quaderni senesi di Economia aziendale e di Ragioneria, serie interventi n. 61, Siena, Copinfax.
Catturi G (2003) L’azienda universale. Cedam, Padova.
Catturi G, Riccaboni A (2001) Economia aziendale e teoria istituzionale: affinità concettuali ed implicazioni operative per il controllo di gestione, Contabilità e Cultura Aziendale, 2.
Chapman C, Chua WF (2000) Information technology, organizational form, and accounting. Proceedings of the 2nd Conference on New Directions in Management Accounting: Innovations in Practice and Research, Brussels, Belgium, 14–16 December: 193–211.
Cooper R, Kaplan RS (1998) The promise – and peril – of integrated cost systems. Harv Bus Rev 76 July–August:109–119.
Davenport TH (1998) Putting the enterprise into the enterprise system. Harv Bus Rev 76 July–August:121–131.
Euske K, Riccaboni A (1999) Stability to profitability: managing interdependences to meet a new environment. Account Organ Soc 24:463–481.
Fahy MJ, Lynch R (1999) Enterprise Resource Planning (ERP) systems and strategic management accounting. Paper presented at the EAA 22nd Annual Congress, Bordeaux, France, 5–7 May.
Fligstein N (1990) The transformation of corporate control. Harvard University Press, Cambridge, MA.
Giddens A (1976) New rules of sociological method. Basic Books/Hutchinson, London/New York.
Giddens A (1979) Central problems in social theory. University of California Press, Berkeley, CA.
Giddens A (1984) The constitution of society. Polity press, Cambridge.
Granlund M (2001) Towards explaining stability in and around management accounting systems. Manag Account Res 12:141–166.
Granlund M, Mouritsen J (2003) Problematizing the relationship between management control and information technology, introduction to the special section on management control and new information technologies. Eur Account Rev 12(1):77–83.
Granlund M, Malmi T (2002) Moderate impact of ERPS on management accounting: a lag or permanent outcome? Manag Account Res 13:299–321.
Henson HE (1997) Back office solutions for management accounting. Manag Account (USA), pp. 47–51.
Hunton JE (2002) Blending information and communication technology with accounting research. Account Horiz 16(1):55–67.
Hyvönen T (2003) Management accounting and information systems: ERP versus BoB. Eur Account Rev 12(1):155–173.
Johnson HT, Kaplan RS (1987) Relevance lost: the rise and fall of management accounting. Harvard Business School Press, Boston, MA.
Macintosh NB, Scapens RW (1990) Structuration theory in management accounting. Account Organ Soc 15:455–477.
Maccarone P (2000) The impact of ERPs on management accounting and control systems and the changing role of controllers. Paper presented at the EAA 23rd Annual Congress, Munich, Germany, 29–31 March.
Orlikowski WJ (1992) The duality of technology: rethinking the concept of technology in organizations. Organ Sci 3(3):398–427.
Orlikowski WJ (2000) Using technology and constituting structures: a practice lens for studying technology in organizations. Organ Sci 11(4):404–428.
Otley D (1994) Management control in contemporary organizations: towards a wider framework. Manag Account Res 5:289–299.
Quattrone P, Hopper T (2000) A “time-space odyssey”: management control systems in multinational organisations. Proceedings of the 2nd Conference on New Directions in Management Accounting: Innovations in Practice and Research, Brussels, Belgium, 14–16 December:601–637.
Quattrone P, Hopper T (2001) What does organizational change mean? Speculations on a taken for granted category. Manag Account Res 12:403–435.
Riccaboni A, Merchant KA (2001) Il controllo di gestione. McGraw-Hill, Milano.
Scapens RW (1994) Never mind the gap: towards an institutional perspective on management accounting practice. Manag Account Res 5:301–321.
Scapens RW, Burns J, Baldvinsdottir G, Ezzamel M (2003) Future Direction of UK Management Accounting Practice Loc 172 (CIMA Research Series). CIMA Publishing, an imprint of Elsevier, Butterworth-Heinman, London, UK.
Scapens RW, Jazavery M (2003) ERP systems and management accounting change: opportunities or impacts? A research note. Eur Account Rev 12(1):201–233.
Sutton SG (2000) The changing face of accounting in information technology dominated world. Int J Account Inf Syst 1:1–8.
Wagle D (1998) The case for ERP systems McKinsey Q 2:130–138.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2010 Springer-Verlag Berlin Heidelberg
About this chapter
Cite this chapter
Maraghini, M.P. (2010). New Integrated Information Systems and Management Control Change in Small and Medium Enterprises. In: Taticchi, P. (eds) Business Performance Measurement and Management. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-04800-5_2
Download citation
DOI: https://doi.org/10.1007/978-3-642-04800-5_2
Published:
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-642-04799-2
Online ISBN: 978-3-642-04800-5
eBook Packages: Business and EconomicsBusiness and Management (R0)