A Framework for Assessing Cost Management System Changes: The Case of Activity-Based Costing Implementation at General Motors, 1986-1993

Abstract

An opportunity to study the technical and organizational impact of management accounting system changes has emerged with companies' adoption of activity-based costing (ABC). This paper provides a structured account of experimentation with, and adoption and adaptation of ABC in General Motors Corporation, from 1986 to 1993. From this case, the paper develops a framework for evaluating ABC implementation and hypotheses about factors that influence implementation. The search for factors that ABC implementation success is guided by information technology and organizational change literature, as well as anecdotal evidence of factors that influence ABC implementation success. Data is gathered from interviews, archival records, and direct observation and the primary method of analysis is with-in case comparison of data sources. The theory of ABC implementation that emerges is one of an evolutionary sequence of implentation stages that are influenced by socio-technical factors.