An organization will not spend millions and incur significant disruption if a system is already in place. However, the replacement of an ERP system due to removal of vendor support, or acquisition by an organization that uses a different ERP solution and a mandated change to that solution are possible reasons for switching to different ERP software, both of which are economically defensible. In this study, we adjusted Granlund and Malmi’s model to include the success of the ERP implementation. As objective measures of ERP system success are generally not available, perceived success was used: business managers (including IT executives, management accountants, and auditors) generally are able to provide an indication of the system’s relative success (i.e. if no one can obtain the needed information to run the business, they will know this and state that the ERP system is not successful; if they can obtain in-depth reports cutting across functional areas in a real-time basis, and have real-time information on inventory and production levels, they will state that the ERP system is successful; hard metrics are not required for this assessment). If an ERP system implementation is successful, the focus of the organization changes from a functional orientation to a process orientation (Davenport, 2000; Wallace and Kremzar, 2001). Doing so requires a change in the management and accounts reporting structure; a change in the generation of reports (since all data are now obtained from a centralised database); and a requirement for communication across functional areas. Since management accountants no longer need to generate the ‘ordinary’ reports, they can provide value for the organization through the generation of forward-looking reports and improved analyses of business options. This is similar to what Caglio (2003) referred to as the ‘hybridisation’ of management accountants. Alternatively, if management accountants insist upon continuing to generate reports outside the ERP system similar to those produced automatically within the ERP system (and the ERP system would generate these reports in a more timely manner), the management accountants will not provide any additional value to that provided by the ERP system and their role will be threatened. This project examined the changes resulting from the implementation of ERP packages on the practice of management accounting. It identified what other changes should occur in the practice of management accounting as a result of the implementation of ERP packages. The results of this study are important to management accountants, not only for these two elements but also when they examine where their organization stands relative to others and relative to the improvements that could be attained from an effective ERP system.
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