I’d like to share my thoughts about the about the view “Without modern informati

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I’d like to share my thoughts about the about the view “Without modern informati

I’d like to share my thoughts about the about the view “Without modern information systems strategic management accounting would not be possible” as follow:
The implementation of information systems plays a crucial role in the achievement of comprehensive benefits in management accounting practices including internal reporting, budgeting, data collection, application of modern accounting techniques and management accounting employees’ jobs, etc. (Pervan & Dropulic, 2019). Modern information systems include several components supporting management accounting such as ERP systems, balanced scorecard or budgeting implemented with specialized software (Rom & Rohd, 2007), extended enterprise system (XES) encompassing ERP, data warehouses, executive portals (Shields, 2001, as cited in Rom & Rohde, 2007), etc.
According to Jawad (2023), the most significant role of information systems is its great efficiency in collecting and processing accounting information that allows organizations to draw up strategic plans and make strategic decisions. An ERP system is an example of information system that is considered as an effective tool in transaction processing because it enhances the supply of transaction data for strategic management accounting activities Rom & Rohde, 2007). What’s more, Fahy & Lynch (1999, as cited in Rom & Rohd, 2007) pointed out that the implementation of an ERP system results in better information and more streamlined financial processes. Similarly, financial statements are better and assets are exploited more effectively with the implementation of ERP systems (Spathis & Ananiadis, 2005).
However, the implementation of modern information systems not always leads to the significant changes in management accounting techniques. While modern information systems are expected to support the changes in management accounting, not all firms seem to adopt them due to the existence of some barriers against adoption (Chenhall & Landfield-Smith, 1988). For example, despite of the availability of ERP systems, management accounting techniques with implementation of an ERP system aren’t adopted by many companies who find no impact of ERP systems on management accounting methods (Rom & Rohd, 2007). Likewise, traditional accounting methods such as activity-based costing (ABC) and balanced scorecard are still implemented, but they are maintained outside the ERP systems and operated in separate systems (Rom & Rohde, 2007).
In conclusion, I don’t agree with the above statement as we can analyze information from any source, and information technology only acts as a catalyst that makes processes easier, and saves time. Hence, modern information systems not necessarily limit our abilities.
Question: in your opinion, what is the impact of accounting information system on decision making?

Strategic management accounting (SMA) in today’s business landscape entails gathering, examining, and deciphering both financial and non-financial information to enhance the decision-making process regarding potential opportunity costs and to meet the demand for structured information systems conducive to strategic implementation, as highlighted by Conner (1991).
Although SMA has been practiced for many years using conventional techniques with quantitative information, the introduction of management information systems (MIS) have revolutionized SMA by enabling the use of more subjective information and facilitating planning and control (Chenhall, 2003). Moreover, MIS play a critical role in supporting the development of sophisticated SMA tools, such as value chain analysis. Data interpretation into information in conjunction with these tools can help businesses identify cost-saving opportunities and assess their competitiveness.
It is imperative to acknowledge that SMA does not exclusively hinge on management information systems. This recognition stems from the understanding that the costs associated with data acquisition, analysis, and interpretation may surpass the benefits derived from timely information for managerial decision-making processes. This circumstance becomes particularly pertinent within organizational contexts characterized by ‘non-integrated’ information systems, where data lacks cross-examination, and resource constraints impede the prioritization and streamlining of processes (Pérez, 1984). In such scenarios, organizations resort to implementing strategic management accounting using both internal and external information derived from conventional tools and techniques. This ‘non-integration’ could possibly be impeded if there’s lack of communication between departments that have separate information systems (Hadid & Al-Sayed, 2021).
In conclusion, while not essential, MIS play a crucial role in contemporary organizations by facilitating data collection and analysis. The collection, evaluation, and sharing of relevant data by management information systems’ integration could enhance the efficiency of SMA practices. Consequently, the utilization of MIS augments the capabilities of SMA, empowering businesses to adapt to dynamic market landscapes and attain sustainable competitive advantages through informed and agile decision-making mechanisms.
Question: How can organizations balance the cost and benefit of MIS for SMA?

The importance of modern information systems for strategic management accounting (SMA) is underscored by the work of both Rashid et al. (2021) and Ojra et al. (2021). They argue that SMA processes heavily rely on these systems, which is reflected in the evolution of management accounting in response to technological advancements.
Ojra et al. (2021) highlight how contemporary information systems facilitate SMA practices in an unpredictable business environment. These systems allow for data integration, analysis, and communication, enhancing SMA’s effectiveness. However, they also call for further empirical studies and practical guidance for practitioners and educators to leverage these systems fully.
Abdelazim (2005) argues that SMA implementation would be complex without modern information systems, as data would be abundant yet fragmented, obstructing a comprehensive understanding of the organisation. Manual, error-prone data processing would limit complex analyses and timely information delivery. Slow, expensive, and inconsistent data dissemination would impede communication and the alignment of strategic objectives.
Question: Given SMA’s growing dependence on contemporary information technology, is there a risk of over-reliance, which might lead to practitioners losing critical thinking and strategic insight? How can this be avoided while still benefiting from the systems’ efficiency and data availability?

It is true that “SMA relates to financial and non-financial information used to support strategic decision-making within an organization. The implementation of SMA would be significantly improved with the availability of modern information systems. Modern firms generate huge amounts of data that go beyond financial transactions and include operational metrics, customer behaviours, market trends, and the machinery of numerous other variables influencing strategic planning”.

Someone could describe this as an ’information revolution’.

Question: Apart from globalization, why has the volume of data increased nowadays? Why speed is so important? What are the consequences of bad quality data?

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