eThesis - School of Business electronic theses

Purpose of this study is to examine management accounting change and resistance in the contexts of localization and globalization. More specifically, implementation of global management information system and standardization efforts of related local management accounting practices were investigated in a case organization. This study aims to contribute to the theoretical discussion by problematizing Cruz et al.'s (2011) findings regarding localization of global management accounting practices by including management accounting change resistance and power as explaining factor in resistance into the discussion.

Theoretical framework of this study is built on examining localization and globalization as phenomena in the context of management accounting change literature. More specifically, this study aims to critically examine Cruz et al.'s (2011) findings regarding localization and globalization of management accounting practices as well as investigating the definition of successfulness of management accounting change (Malmi, 1997). In addition, the discussion on resisting factors to management accounting change, concentrating specifically on power related issues, will be used as a foundation for the study (Markus & Pfeffer, 1983; Bariff & Galbraith, 1987; Malmi, 1997; Burns, 2000; Burns & Scapens, 2000; Granlund, 2001).

The research method is a single-company case study. Empirical data was gathered by doing 11 semi-structured interviews covering both global management and local units in the case organization in January - April 2013. Additionally, participant observation had an essential role in the empirical data collection and validation of it.

Based on the empirical evidence of this study, the findings indicate that locality is a central feature in global organizations: instead of emphasizing globalization and homogenization, locality should be emphasized. This study uncovered that in standardization efforts of global management accounting practices, the heterogenized local management accounting practices do not complement but in fact resist the homogenizing tendencies of global system. The variety, which is created by heterogenized local management accounting practices, undermines global management accounting practices. Thus, it could be argued, that the power of locality is a significant source for management accounting change resistance in the context of globalization efforts in management accounting change. In other words, local units can have power over the global unit, such as control over the resources. The findings indicate that as the locals differentiate themselves from the global, it might also mean that they somehow undermine and resist the corporate objectives by creating variety and heterogeneity. To conclude, the power of locals might work against globalization efforts; on the contrary to Cruz et al.'s (2011) view, the variety could in fact be the source of resistance.