Technology Implementation for Accounting Information in Business
TECHNOLOGICAL IMPLEMENTATION TO SUPPORT THE ACCOUNTING INFORMATION SYSTEM IN SMALL AND MEDIUM ENTERPRISES
This era is the era of digital technology. From global organization to smaller industrial organization, digitization is dominating everywhere. As per the finance of smaller companies are concerned, apparently it may seem that, there is not much data required in the financed department of these kind of companies. However, the reality is the opposite. The requirement of data in increasing year after year and hence the data requirement is increasing day by day. With sales data, financial data is also increasing and hence, technical integration is required in the financial technology. Cloud bases services are able to provide almost unlimited memory and therefore are appropriate for bug data management from financial perspectives. In this report, description methodology is used so that all aspects of technical implementation can be covered. Along with this, mix methodology has been followed to compile both quantitative and qualitative data.
Micro-business associated with small businesses and medium sized firms are referred to as SMEs (small and medium-sized enterprises). SMEs plays a very significant role in Australian economy as they generate employment opportunity, facilitate innovation and entrepreneurship. The vast majority (over nine in ten) of Australian businesses are small businesses. They account for 33 per cent of Australia’s GDP, employ over 40 per cent of Australia’s workforce, and pay around 12 per cent of total company tax revenue (Government, 2016). The European definition of SME follows: "The category of micro, small and medium-sized enterprises (SMEs) is made up of enterprises which employ fewer than 250 persons and which have an annual turnover not exceeding 50 million euro, and/or an annual balance sheet total not exceeding 43 million euro." (Rijkers, December 2014). The SMEs also helps in various sectors like health, education, tourism, etc. Because of the minimum resources, it is unable for the SMEs to compete with large companies. Therefore, there is necessary of introducing technologies for SMEs in order to strengthening their competitiveness in the business market.
In this context, it is obvious that accounting is considered the driving tool for enterprises to help them move forward surpassing the rivalry of the competitors. The prime aim of making the Accounting Information System or AIS state-of-art is to improvement of the overall efficacy of their operational management. Along with overriding the competition, application of AIS is also suitable in terms of facing fiscal issues, trade agreements and many more. In the same sense, it can be argued that AIS is beneficial for organizations belonging to SME industry in the light of mirroring enterprise state, financial statement and relevant outcomes (Chiwamit et al. 2017). Decision-making process of organizational operations is also governed much in this complex business situation by the involvement of AIS tools. Specifically to concern, increase of sales level, facilitating strengthening of customer relationship followed by decrease of operational cost can be accessed with inclusion of AIS inside business premises. In spite of those competencies, some drawbacks are prevalent with AIS, such which is influencing the entrepreneurs to raise questions against the efficacy of inclusion of AIS in modern business practices. Accounting functions related to AIS system has to be handled carefully and this should be of fundamental importance for accountant professionals. Unless this, financial information is provided by AIS of an organization may become underused resources (Teittinen and Granlund, 2017). Specifically to mention, information related to IT return on investment capacities of an organization may be disrupted totally. Therefore, it is the utmost requirement of this situation that the organization hierarchy has to go through a thorough research analysis of different modalities of AIS system prior to implement AIS tools inside an organization.
In this current discussion, a research background is provided regarding the utility of going through this research. In addition, problems that are relevant to this research topic is delineated in this research followed by depicting clearly the aims of this research. Literature review is performed in this research by taking into account different thematic analysis approaches. Apart from that, the current research has investigated into this research topic from a broader aspect by eliciting the importance of research design and research methods that are being incorporated into this research.
The research background focuses on the impact of technology in the accounting information system of the business. The innovation of technology has improved the performance of the business organisation. The businesses and enterprises are undergoing considerable changes. Along with the operations of SMEs, the information technology has become one of the essential factors for the survival and growth of economies in general. Similarly, the information technology has connected all the aspects of life. In the information society environment, successful enterprise produce high technology goods and services to satisfy customers need. To gain all the success, SME need high quality information and they must always provide superior value, better than competitors must, when it comes to quality, price and services (Pollard, february 2006).
SMEs would require information technology system, which support decision-making, provide effective interface between users and computer technology and provide information for the managers on the day-to-day operations of the enterprises. Several studies have also added that accounting information system acts as a mechanism that facilitates the implementation of organizational strategy and increases the flexibility in the company (Dincer & Dincer, 2016). The managers of SMEs need to keep updated IT system for decision making accurately and timely. The adoption of accounting information would ensure proper accounting practices. The recent business research shows that the usage of information of IT in the business will be an important factor competitive growth of SMEs in the global and regional market.
Research problems and relevant objectives
Nowadays technology and accounting information systems are synonymous for companies belonging to both large industry as well as SME industry. In this regard, it can be stated that organization’s productivity and innovations are recognized to be exceptionally influenced by accounting information system (AIS). Therefore, tools related to accounting information system hosts a large amount of investment every year (Teittinen and Granlund, 2017). However, this technological supervision, which has to be integrated with IT infrastructure of an organization, is observed to be facing some drawbacks as well due to irrelevant or incompatible strategies being used for its implementation inside complex business activities. Thus, along with lots of benefits, some accrued operational difficulties may also arise which has to be considered in the due course of going through this research.
The problems associated with this research topic may be demonstrated herein as follows:
- What are the approaches followed by the accountants for the proper functioning of the organisation?
- What are the factors causing the technological issues, which is affecting the overall performance of the organisation?
- What is the effect of information management in accounting information system generated due to technology?
- How can the analytical tools for accounting be affected by the technology in decision-making?
- What essential measures should be undertaken to strengthening the competitiveness of SMEs?
Research aim and relevant objectives
The principal aim of the research is to demonstrate the growth in the performance of SMEs accounting system due to technology.
- To analyze the approaches followed and the common or complementary technological issues faced by the accountants of SMEs
- To find out the effects of technology in the analytical tools for accounting in decision making
- To recommend necessary measures on strengthening the competitiveness of SME participants and improving industrial competitiveness
- To determine holistic influence of technological alignment and technological infrastructure of SMEs on overall performance
Most often SMEs are recognized as micro, small and medium-sized enterprises and are known as the major economic contributors in Australia, and internationally. Despite there being no agreed definition, the commonwealth legislation has been providing special protections for SMEs. Because of the huge potential benefits to the economy, SMEs is becoming one of the main factor of attraction in business world in recent years.
SMEs is one of the business organizations that has been developing greatly by promoting economic and social development which results in creating employment opportunities, developing competitiveness and widening markets in the business world. This study shows that how effectively the adaptation of innovative technologies in the business organization will increase production, develop entrepreneurship and utilize the local resources. As we all know, new technologies have great impact on the global society and economy and generate opportunity for business to improve their efficiency and effectiveness and even help to gain the competitive advantage to SMEs.
Common themes across
The study of all the four publications provides us the overview of the role of technology in the SMEs. It gives the knowledge about the effectiveness of innovative technology, its implementation and the competitive advantage in day-to-day business operation. Similarly, SMEs plays a vital role in reducing the poverty as it provides employment opportunities to the people and also it can be adopted in any sector of the economy such as service, production or manufacturing industries. All the authors agreed that the technology helps in the promotion of performances in SMEs.
According to Jane Francis and Colleen Dodd, the use of latest technology helps the firm specially SMEs to enhance the performance by improving firms’ capabilities, resources, strategies and overall competitiveness. In addition, it ensures the SMEs to overcome the limitations such as lack of experience, limited resources or other perceived or real limitations. Parida, et al. (p. 286) pointed out that the innovation and technology management has various potential benefits of starting the innovation process. The SMEs can open innovation by collaborating with network partners as they can compensate for the lack of internal resources and competencies. The collaborations can develop new technological combination and hence can take the advantage of wider range of market opportunities. However, the main challenge that affect SMEs cross the publication is complex business environment that limits their development. Even the internal challenges of SMEs such as weak or unmanaged human resource, weak management, inappropriate technological capabilities etc. limit its growth.
The authors agrees that SMEs can be benefited from the developing competences for dealing, information thorough resources, enjoy reduced transaction costs, develop capacity for information gathering and propagation of global scale and improvement access to speedy flow of information. The SMEs therefore are responsible for technological innovations and discoveries as a result of entrepreneurial adventures of properties of SMEs. SMEs are ideal for the development, innovations and creation of talents.
Talking about the different themes, the writer has their own perception in the four publications. The main theme by Beley and Bhatarkar (p. 1-4) is representation of SMEs in socio-economic policies. SMEs development is drawing attention to modern trends businesses and usages of information technology. The long-term economic development of the country depends on how the SMEs sector is being promoted. Behind this, SMEs also revitalize and develop national economy. Furthermore, it is also considered as the key agent for the growth of socio-economic conditions due to its major role in fostering growth, jobs creating and reducing poverty.
Globalization of world economy and technological developments in the two decades of twentieth century has transformed the majority of wealth creating work from physically based to knowledge based (Beley & Bhatarkar, February 2013). It has also created the value of information technology to business organisation by contributing various new business chances. These technologies enable the progress of comprehensive work, where SMEs operate across national boundaries. Greater the use of new technology, higher the availability of improved information, quality of work, effectiveness and efficiency in performing tasks. Hence, technologies will always be one of the important factors in the development of countries, economies and enterprises. The main theme by Parida, Westerberg and Frishammar (p. 283-309) is open innovation in SMEs. The author states that SMEs depend on their ability to be innovative for gaining and nourishing competitive benefits. The open innovation activities provide access to missing knowledge, reduce the cost of development, provide possibilities for risk sharing and improve the product development process (Parida, et al., 2012). Therefore, open innovation is always a way to solve challenges along with increase in profitability. Because of the less internal resources, limited size and restricted competence base, SMEs are often forced to produce new products faster and more effectively which is challenging for SMEs. According to author, despite the challenges the SMEs can get profit from the use of open innovation due to its higher ability to respond to the external environment and less bureaucracy.
The information technology affects the variables like productivity and interorganizational coordination (Haberkamp, et al., 2010). IT impact is higher on the strategic variable of productivity, followed by interorganizational coordination, and that is lower on the costs and market. The author also pointed out that the business organisation uses IT as an operational tool. The main theme for author Francis and Collins-Dodd the export promotion programs for SMEs. Export promotion programs are provided to SMEs to help them overcome real or perceived obstacles to exporting (Francis & Collins-Dodd, October 2014). The SMEs are the major concern for government because they represent important sources of export dollars, and to succeed in this sector is very necessary for the upcoming international economic competitiveness. Using the greater number of government program expands export strategies and enhance export marketing competencies for SMEs.
Managers are indeed the important individuals of an organization that are responsible for satisfactory decision-making. In this context, Patel (2015) has arguably proposed that managers of organizations belonging to SME industry need to take significant responsibilities in ensuring success of organizations and that can be surely achieved with creating a suitable atmosphere inside the business house so that technological tools can be afforded with any hassle. In this concern, Fullerton et al. (2014) has forwarded a pronounced opinion according to which it can be stated that managers of an organization are pivotal individuals for finding technological issues followed by replacing them with the cutting-edge technologies. Along with this, ample job responsibilities have to undertaken by the managers regarding hiring of superlative team for betterment in human resource management or management of overall financial performance. Uyar et al. (2017) has supported the above comments and further argued that managers also need to focus more on strengthening competitiveness of the employees and that can be of course achieved through following a holistic approach in improving the industrial competitiveness. Indeed, technological tools such as cloud-based AIS system are approachable by the accounts managers are surely beneficial. Incorporation of such technological innovation is able to take on creating a sustainable and competitive working environment.
In fact, accounts manager has to undertake much responsibilities regarding successful implementation of Accounting information system. Various roles of accounts managers are in this regard mentionable. In this context, Fullerton et al. (2014) has opined that accounts managers has a close relationship with information system incorporated inside business premises. Accounts managers can supervise these objectives through three different ways. As for example, accounts managers can handle any critical situation regarding AIS system management as designers, auditors and, of course, system users. All these roles can be exceptional for organizations if achieved satisfactorily by accounts managers. Such deployment of roles and responsibilities in creating advocacy regarding AIS system management is also suitable for swift decision-making process.
Organizational support towards implementation of AIS
It is obvious that implementation of AIS inside companies belonging to SME industry need to cope up with technological variances. Technological supervision that can be experienced through this approach is, of course, can shape differently the organizational performance. According to the opinion of Simkin et al. (2014), organization employees may sometimes resist such changes enabled with technological intervention. However, different forces such as catalysts, motivators and facilities are able to shape potential for these changes. Leaders of organizations can be considered as potential catalysts under such circumstances who can govern in making these changes prompt. Nevertheless, as pointed out by Collier (2015), potentials for changes are generally accompanied with barriers for changes, which are further restricting the organization to enact these changes accordingly. Barriers in this context may come in different formats such as negative attitudes regarding embracing new technologies among staff or different priority perceptions regarding technology utilization. Thus, it is the responsibility of the managers to identify the change potentials along with relevant barriers so that change can be injected inside the organization.
In this context, Ismail and King (2014) has opined that in order to place technical solutions such as AIS system inside business workplace, support of a sponsorship process would be handful. This will influence the managers to act according to change requirements, which will be further supportive for advocating merits throughout the education process involved in this change management procedure. As per the viewpoint of Lavia López and Hiebl (2014), this is actually a methodical and systematic procedure that involves support and motivation for individual actions that can be aligned with required change. Organizational as well as behavioral variables have been occupied a central position in this change requirement situation. Some specific examples in this context may be stated as support of top management, resources ownership, training along with specially canned software. Previous working environment may be a barrier that also can create risk for the organization. Therefore, as opined by Turner et al. (2017), prior to technical implementation, change challenge can take place. In addition, once the technical solution is being implemented, other supportive-challenges may arise. Thus, organization hierarchy need to elicit extreme support from followers to comply with a change management process that can be further suitably handled through implementation of technical modalities such as AIS system.
Study limitation and future research direction
There are limitations in the study as this study is only based on the situation of selected journals and for sure these are not applicable for other situations in different parts of the country. The average success rate of innovative efforts tends to be much lower than desirable due to the high level of risk, lack of multidisciplinary competence base, etc. Even though prior studies have made important contributions to the literature and management practice alike, by addressing open innovation activities in the SME context, there is clearly a need for more quantitative studies that can advance our understanding regarding the effects of open innovation activities in SMEs (Parida et al. 2012). It is also recommended that viable model be developed in future studies to help understand the influence of said factors on development of goals of SMEs. Furthermore, a regression analysis was also performed, using competitiveness and productivity as dependent variables, and the other variables as independent to gain more information.
Research methodology and research design
A research design is a compilation of concrete procedures y virtue of which various variables involved in the research may be analyzed. In the present study, following of descriptive design would be of utmost efficacy. Descriptive design is suitable in this context since this design can be potentially utilized for researching collected data in a realistic manner. More specifically to say, a useful insight about the adhered problems with this research topic can be gained. Thus, current problems that are impeding the growth of evaluation of AIS systems in organizations belonging to SME industry may be assessed in this process. In addition to this, by adopting this research design, quantitative data can be collected on massive. More realistically to say, data collected through descriptive model can be investigated with approach that is more realistic so that whole research can be accomplished fruitfully. Thus, for going through an authentic research analysis, descriptive research model would be explicitly helpful for the researcher.
Research approach is a sophisticated way through which whole research matter can be explored with a holistic viewpoint. In this context, both primary and secondary data would be collected which ultimately means that it would be better to go through a mixed method. This particular approach is particularly appropriate for getting an in-depth information as well as knowledge of diverse problems that are associated with the research topic. Datasets thus involved in the research investigation can be checked thoroughly and reliably in this process. Findings reliability as well as credibility of this research may also be enhanced many folds in this way.
Data Collection Plan
Data collection is the process of collecting various information from all the reliable sources to find answers to the research problem. The research will be done by collecting primary data as well as secondary data.
The primary data includes both qualitative and quantitative data collection methods. Quantitative data analysis includes questionnaires with closed-ended questions whereas qualitative data analysis considers ensuring high level of depth of understanding. It includes interviews, questionnaires with open-ended questions, observations, case studies, etc. The secondary data are those, which has already been published in books, newspapers, journals, online portals, etc. Application of appropriate set of criteria to select secondary data to be used in the study plays an important role in terms of increasing the levels of research validity and reliability (Dudovskiy, 2018).
Ethics in the business shows how data is collected, analyzed and used. Typical definitions of ethics refer to the rightness or wrongness of behavior (Lewis, October 1985). While conducting the research, one should keep in mind that the ethical standards should be maintained and the data collected during this process should not be used or modified for any other beneficial use. Furthermore, the personal information and opinions of the participants shouldn’t be disclosed. Also, researcher can ask the participants to decide to which extend the private information can be shared with others. This will allow him/her to give their consent. In this concern, it can be stated without ambiguity since data collection has involved secondary data as well, thus, confidentiality of those data would be maintained throughout the process of research. In addition to this, it would be ensured in the due course of this research that no person being involved in survey or interview process is coaxed to join in that research.