Coordinating the processes of resource enrichment and capability deployment. Lessons from IT implementation at a medium-sized accounting firm

• Date: 30 September 2014
• DOI: https://doi.org/10.1108/IJAIM-07-2013-0043
• Published date: 30 September 2014
• Pages: 357-374
• Author: Gary Pan,Sayyen Teoh,Poh Sun Seow
• Subject Matter: Accounting & Finance,Accounting/accountancy,Accounting methods/systems

Coordinating the processes of

resource enrichment and

capability deployment

Lessons from IT implementation at a

medium-sized accounting rm

Gary Pan

School of Accountancy, Singapore Management University, Singapore

Sayyen Teoh

School of Business IT and Logistics, RMIT, Melbourne, Australia, and

Poh Sun Seow

School of Accountancy, Singapore Management University, Singapore

Abstract

Purpose – The purpose of this paper has been to address the research question of how are the

processes of resource enrichment and capability deployment coordinated during information

technology (IT) implementation at a small- and medium-sized accounting rm (SMAF)? Increasingly,

organizations need to respond to a wide range of IT-based opportunities and pressures. The situation is

no different in an accounting rm. Many accounting practitioners have advocated investment in IT to

improve accounting rms’ productivity. To date, there are many instances of how IT has radically

transformed the nature of accounting practice. Nevertheless, little is known about how IT capability is

developed in SMAFs. In particular, the resource enrichment process during IT capability development

has been understudied.

Design/methodology/approach – The strategy of this paper was to undertake qualitative case

research of an ERP systems upgrading project at SMAF. The case study approach is particularly

appropriate for this exploratory study because it allows the capture of organizational dynamics of the

phenomenon better (Newman and Sabherwal, 1996; Yin, 2003). Its strength also lies in its ability to

explain the phenomenon based on the interpretation of data (Klein and Myers, 1999). Next, the paper will

explain the case study approach. It approached eldwork at SMAF, with a premise that resource

enrichment and capability development exist and are identiable using an existing theoretical lens.

Accordingly, this study draws on Sirmon et al. (2007) ’s concept of resource enrichment process and

objectively studied the IT capability development process through the resource enrichment lens. At the

same time, it was recognized that resource enrichment and capability development may have their own

unique characteristics, unrelated to any theoretical models offered in the organizational literature.

Findings – The purpose of this paper has been to address the research question of how resource

enrichment process may occur during IT capability development process of an SMAF. This study used

a resource-based view of rms as its analytical lens. The study has drawn on SMAF’s sage ACCPAC

ERP solution (ACCPAC) system upgrading experience by interviewing relevant project stakeholders

and reviewing secondary data extensively. Our analysis identied two actions that were instrumental

in enriching resources in the IT capability development process: collective leadership and managing

change. Three attributes that supported the resource-enrichment process include effective governance

structure, extensive IT knowledge and business experience, and stakeholder commitment. In addition,

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/1834-7649.htm

Resource

enrichment and

capability

deployment

357

Received 6 July 2013

Revised 13 August 2013

24 August 2013

Accepted 20 September 2013

International Journal of Accounting

& Information Management

Vol. 22 No. 4, 2014

pp. 357-374

© Emerald Group Publishing Limited

1834-7649

DOI 10.1108/IJAIM-07-2013-0043

two coordinating mechanisms were put in place to enable an organization to transform existing

resource and capability: informational and IT structure.

Originality/value – From research point of view, this paper makes several theoretical contributions.

First, this study has contributed to the accounting information systems literature by examining the

transformation processes of resource and capability enrichment during IT implementation of a context

that is little known. It helps to address the call for more research into IT use and the impact of such tools

by SMAFs by Omoteso and Sangster (2011). Second, this study extends the understanding of the IT

capability development process by demonstrating how an organization developed IT capability.

Through this case, how fundamental resources can be leveraged through specic actions and strategies

undertaken have been uncovered. The empirical evidence gathered in the case of SMAF provides useful

insights into how resources and capabilities may be enabled. Third, the coordination of the resource and

capability transformation contributes to theory development as the coordination mechanisms derived

from this analysis offer an insights into how a set of enriched resources and capabilities are

synchronized during IT implementation.

Keywords Enterprise resource planning systems, Small- and medium-sized accounting rm,

IT capability development, Resource enrichment

Paper type Case study

Introduction

Increasingly, organizations have been responding to a wide range of information

technology (IT)-based opportunities and pressures (Alves, 2010;Yunis et al., 2012). The

situation is no different for an accounting rm (Omoteso and Sangster, 2011). Many

accounting practitioners have advocated IT investments to keep up with advancement

in accounting information systems. According to Lee and Arentzoff (1991), IT

investments committed by public accounting rms are an important means to improve

accounting rms’ levels of productivity. To date, there are many examples of how IT has

radically transformed the nature of accounting practice (Elliot, 1998): the use of

specialized audit software to substitute IT for labour and changed audit practices and

structure within audit teams (Razi and Madani, 2013); the use of IT as a common

platform to utilize accounting data as it allows sophisticated queries to be performed for

decision-making (Granlund and Mouritsen, 2003); the adoption of enterprise resource

planning (ERP) systems that enables accounting rms to integrate various functions to

streamline information ows across the entire business (Ferguson and Seow, 2011); and

the introduction of eXtensible Business Reporting Language (XBRL) that changes

nancial reporting process.

Nevertheless, whether a rm achieves competitive advantage depends on its

available resources and how it mobilizes these resources (Barney, 1991). The mastery of

mobilization may require a knowledge discovery process that involves “learning and

unlearning” the resources and capabilities, and the way they are synchronized. Such an

improvisation process may create a set of enriched resources and capabilities. Resource

enrichment enhances the integration between resources and capabilities. According to

Sirmon et al. (2007), the aim of a resource enrichment process is to extend and elaborate

a current capability. Capabilities can be enriched by learning new skills that extend

the repertoire of current skills or by adding a complementary resource from the resource

portfolio to the current bundle. An additional resource may have existed in the resource

portfolio for some time, or it may have been developed or acquired recently with the

purpose of enriching a particular capability.

IJAIM

22,4

358