Measuring the Success of Activity Based Costing within the Enterprise Resource Planning Environment in Greek Companies

Abstract

Activity-based costing (ABC) is a strategic tool that can enhance all processes and functions of an organization once it is implemented successfully. This study aims to examine the ABC implementation success in Greek companies in major sectors of the economy. A web-based questionnaire was conducted between February 2020 to January 2021 and collected data from 102 companies found in major sectors of the Greek economy. ABC implementation success was assessed across five dimensions, namely, general attitude toward the implementation process, technical and technological characteristics, impact on organizational process, perceived usefulness in improving job performance, and perceive ease of use. Further, this study compared companies that fully implemented ABC to those that still practice traditional cost accounting (TCA), assessing factors that influence ABC success within Enterprise Resource Planning (ERP). Findings from this study show that a successful integration among ERP and ABC can minimize the operation costs and enhance the competitiveness of the enterprise. In particular, the findings indicated that the degree of ABC within ERP implementation success positively motivates the extent of its use, enhances user performance, increases productivity, and increases user satisfaction with the system. This study contributes to the existing literature since there has been limited research on measuring the success of ABC within ERP implementation in Greek companies. Further, it provides theoretical and practical insights about factors that might influence the success implementation of ABC within ERP that can be applied to other countries. Overall, entities with ABC implementation have improved outcomes relative to those with TCA.