The Effects of Organizational Culture and Structure on the Success of Activity-Based Costing Implementation

Zhang, Y.F. and Hoque, Z. and Isa, C.R. (2015) The Effects of Organizational Culture and Structure on the Success of Activity-Based Costing Implementation. Advances in Management Accounting, 25. pp. 229-257. ISSN 1474-7871

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Official URL: http://dx.doi.org/10.1108/S1474-787120150000025008

Abstract

Purpose - We examine the interactive effects of organizational culture and structure on the success of implementing activity-based costing (ABC) in Chinese manufacturing firms. Methodology/approach - We applied contingency theory of management accounting and used a questionnaire survey of 106 respondents. Findings - The results indicate that a formalized organizational structure significantly affects the success of implementing ABC. The organizational culture factors, outcome orientation and attention to detail, were significantly associated with the success of implementing ABC. Further, interactions between centralization and outcome orientation and formalization and innovation were associated with success in implementing ABC. Research implications/limitations While this study is constrained to Chinese manufacturing firms, its findings have ramifications for organizations in both developed and less-developed economies as the study demonstrated that organizational structure and culture interact with each other to affect the implementation success of a management accounting system. Originality/value - This paper presents the first attempt to demonstrate the interactive effect of organizational culture and structure on the success of implementing ABC in organizations.

Item Type: Article
Uncontrolled Keywords: Activity-Based Costing; China; Organizational culture; Organizational structure
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HG Finance
Divisions: Faculty of Business and Accountancy
Depositing User: Ms. Juhaida Abd Rahim
Date Deposited: 19 Sep 2018 02:12
Last Modified: 19 Sep 2018 02:12
URI: http://eprints.um.edu.my/id/eprint/19275

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