Why some accounting innovations fail? A case study of a New Zealand public tertiary education institution
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Narayan, A
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Stockholm Business School, Stockholm University
Abstract
This paper examines why activity-based costing (ABC) and the balanced scorecard, two most
significant accounting innovations in recent years, failed to be successfully implemented in a
large tertiary education institution in New Zealand. The findings demonstrate that the
implementation of both systems presented significant challenges. ABC failed because it was
perceived to offer a low relative advantage, was highly complex, its implementation was not
trialled, the benefits were not visible, and there was lack of communication, inadequate
training and no change agent facilitating adoption. The balanced scorecard failed because the
institution was caught in a performance evaluation trap with bureaucratic compliance to
government requirements preventing any real improvements, adoption was symbolic to give
legitimacy but suffered from a lack of rationale or logic, and there was no real observable
influence on performance improvements. The politically imposed measures with an emphasis
on financial performance forced the institution to play the numbers game rather than deliver
‘real’ performance.
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Keywords
Accounting innovation; Activity-based costing; Balanced scorecard; Public sector; Tertiary institutions
Source
Interdisciplinary Perspectives on Accounting (IPA 2015) held at Stockholm Business School, Sweden, Stockholm, Sweden, 2015-07-08 to 2015-09-10
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Authors retain the right to place his/her publication version of the work on a personal website or institutional repository for non commercial purposes. The definitive version was published in (see Citation). The original publication is available at (see Publisher’s Version).