Discussion

This case study illustrates that to ensure cooperation and a complex relationship in the interorganizational field, information technology plays a central and vital role in orchestrating different relationships and boundaries. Moreover, it has a considerable effect on management accounting rules and routines. The system change showed how the rules were affected and how they caused both unintended and deliberate changes.

Losing control in Amadeus

“Open system”

- Complex systems/Net works, including third parties

- Increased system complexity - Lack of intraorganizatio nal

collaboration - Loss of management control

- Overlapping accountability, multiple accounting entries through intermediaries and associates, controlling supply chain affiliations - Accounting practices in open system led to loss of control

- Using intermediaries to facilitate distribution.

- Loss of control in the IT setup made system use highly complex, giving power to the information system supplier

- Inter-mediation:

Meeting strategy gave the ability to distribute globally, creating different power relations between the organization and information technology.

- The scheme was moving toward global competitiven ess, meeting market demands efficiently by outsourcing, competitive pricing, and profitability.

- System supplier: The airline had started to adhere to the new system, which was controlled through the extensive and complex relationship with its system supplier.

- Meeting market demands - Fight of competition - Global distribution - Managing relationships

Table 5 – Case analysis enactment in Air Greenland (Lind and Thrane’s (2010) framework)

The case study reveals the need for change and how it is facilitated by information technology.

The analysis illustrates the extensive power and position that information technology has in the interorganizational field, and how this position allows it to facilitate relationships and move boundaries far beyond the organizational sphere. The empirical study illustrates how these relationships are established or terminated as a consequence of information technology and, more specifically, how they change from one relationship into serial relationships and end as a complex network, depending on the use of technology (Lind & Thrane, 2007). To establish and analyze these relationships, Lind and Thrane’s (2007) framework and the use of the institutional perspective has been useful in identifying the relations between information technology and management accounting, and they reveal the dominant role of information technology in the organizational field. The process of going from one information system to another illustrates how technology can rapidly alter existing boundaries. This demonstrates how information technology plays an active role in the change process by orchestrating complex relationships through different information systems, and how this affects organizational practices such as management accounting.

The empirical study established changes in management accounting practices as a consequence of the shift from one information system to another. Being in a competitor-controlled environment especially emphasized the dominance of the system owner SAS and their impact on management accounting practices. A large part of the transactions in terms of the distribution of passenger seats was controlled in the SAS system, reducing the ability to use management accounting, with Air Greenland having more focus on operational excellence. Going into a closed system that was controlled by Air Greenland created an environment where stronger management accounting practices could be applied. Management could now control all

transactions and improve their practices to place more emphasis on control and efficiency.

Going into an open system created many challenges. In the closed system, the organization had established strong management accounting practices; in the open system, these had to be altered to support the new information system and its processes. The open system created an environment in which several management accounting practices became more complex and harder to control and now had to incorporate the new processes of the open external system.

It is crucial to take a longitudinal perspective on the interaction of multiple information systems and the development of management accounting practices. This clarifies the relationship between information technology and management accounting and how different information systems can create different settings for management accounting practices, thereby creating change. This case study states the significant role of information technology in the interorganizational field.

Management accounting and information technology

This study established how information technology has a significant impact on internal practices such as management accounting rules and routines. The case study further emphasizes that these changes need to be analyzed over a longer duration to fully understand their implications.

However, there has been little discussion on a more longitudinal perspective of analyzing multiple implementations and the role of information technology in more complex situations and relationships.

Studies analyzing the impact of information technology in the management accounting field have extensively focused on single system implementations and the direct impact of information technology. These studies have analyzed different practices from various perspectives such as management control and actor-network theory (Dechow & Mouritsen, 2005; Quattrone &

Hopper, 2005, 2006), management accounting and new institutional sociology (Granlund &

Malmi, 2002; Hyvönen, 2003; Scapens & Jazayeri, 2003), and management accounting and modeling (Baiman & Rajan, 2002; Nicolaou, 2008). These different perspectives have given notable insights into the direct impact of an information system in the organizational field and in establishing the fact that this impact varies.

This study extends the existing literature by going beyond the direct impact of a single system implementation to illustrating how multiple system implementations affect organizational practices from a more longitudinal perspective and how this changes interorganizational relationships. This case study illustrates how information technology is not merely a simple tool fulfilling the needs of the actors themselves. The case study establishes the dominant effect that technology has and how this can create both constraints and support for the actors. Furthermore, it examines how an information system plays a central and dominant part in the orchestration of multiple and complex relationships by moving interorganizational boundaries and being both a catalyst and an inhibitor for change. The paper thus lends support to research arguing for the significant effects of information technology on management accounting.

Network accounting and information technology

This paper supports literature that argues for the strong impact of information technology in the interorganizational field (Frances & Garney, 1996; Cuganesan & Lee, 2006; Dechow et al., 2007). It argues for more research on how change occurs and analyzing it over time with a focus on multiple implementations of information systems. This paper concurs with the findings of Frances and Garney (1996) and Cuganesan and Lee (2006) who stated that information technology plays a dominant role in the interorganizational field. This empirical study illustrates how multiple relationships are established to facilitate the vertical relationships of suppliers, buyers, and sellers as well as how horizontal relationships such as partners, competitors, and strategic alliances play a part. These relationships create the settings for new networks that change existing boundaries.

Analyzing vertical and horizontal relationships has provided the opportunity to observe and demonstrate the ever-evolving combinations of complex relationships and how this strongly affects management accounting rules and routines. It further allows an analysis of how interorganizational control is configured through information technology and how it can expand and reduce the interorganizational field. Many studies of the interorganizational field have analyzed the interdependencies between internal and external boundaries (Dekker, 2004;

Håkansson & Lind, 2006; Mouritsen & Thrane, 2006; Thrane & Hald, 2006; Thrane, 2007;

Meer-Kooistra & Scapens, 2008); this paper extends them by showing how vertical and horizontal relationships change as a result of the information technology setting. This paper

extends existing research by analyzing several information systems from a longitudinal perspective.

Literature in the management accounting and interorganizational fields has consistently focused on the relations between buyer and supplier; literature on network accounting has extensively analyzed upstream relationships in supply chains but captured only snapshots of the true changes happening therein (Caglio & Ditillo, 2008). Based on the need for further knowledge, this study emphasizes that to fully capture complex interorganizational changes, it is crucial to examine these changes over a longer duration and in more detail. This paper adds to existing literature by using an institutional perspective with a focus on multiple system implementations and the arrangement of different network settings.