Impact of enterprise resource planning systems on management control systems and firm performance

Juha-Pekka Kallunki, Erkki K. Laitinen, Hanna Silvola

Research output: Contribution to journalArticleScientificpeer-review

93 Citations (Scopus)

Abstract

In this study, we extend existing research on enterprise resource planning systems by exploring the effects of enterprise system adoption on subsequent non-financial and financial performance of a firm. Specifically, we investigate the role of formal and informal management control systems as mechanisms which mediate the effect of enterprise resource planning systems adoption on firm performance. Our empirical analyses are based on survey data drawn from 70 Finnish business units. Overall, our findings demonstrate that formal types of management control systems act as intervening variables mediating the positive lagged effect between enterprise systems adoption and non-financial performance. Informal types of management control systems, however, do not show similar mediating effects. We also predict and find a significant relationship between non-financial and financial firm performance. These results are important because the evidence on the joint roles of enterprise systems and management control system on improving the firm performance is very limited in prior literature. Our results show that the use of enterprise systems results in improved firm performance in the long run, and that more formal than informal types of management controls help firms achieve future performance goals.
Original languageEnglish
Peer-reviewed scientific journalInternational Journal of Accounting Information Systems
Volume12
Issue number1
Pages (from-to)20-39
Number of pages20
ISSN1467-0895
DOIs
Publication statusPublished - 2011
MoE publication typeA1 Journal article - refereed

Keywords

  • 512 Business and Management

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