Using Prototypes to Induce Experimentation and Knowledge Integration in the Development of Enabling Accounting Information

We investigate enabling performance measurement systems (PMS) in operations, i.e., systems that are perceived by employees as assisting with their daily work. We contrast enabling PMS with those that are primarily a control device by senior management. Previous research in accounting suggests that the development of enabling PMS requires room for experimentation by users, as well as cross-functional knowledge integration. How this can be done has received less attention. Building on the new product development literature, we investigate how prototypes can support experimentation and knowledge integration in the context of accounting. The empirical results are based on a longitudinal case study, using action research. We study the process of developing a performance measurement system for transportation costs. In this process, employees from various functions and departments had to cooperate as no single employee possessed sufficient knowledge about operations, accounting and information systems by oneself. The process consisted of several cycles of experimentation in which prototypes of the new accounting system were used as integrating devices. The prototypes were based on traditional accounting tools, such as variance analysis, and on information provided by the employees during the discussions. This process gave the employees many new insights and led to a new accounting system that was accepted by all of them. We identify several characteristics of effective experimentation and knowledge integration in accounting