Internet-based technologies, accounting processes, and management control systems

This chapter explores how Internet-based Technologies (IBTs) affect accounting processes and Management Control Systems (MCS). It covers five potentially disruptive IBTs: Cloud Computing, Big Data & Data Analytics, Artificial Intelligence, Internet of Things, and Blockchain. IBTs offer opportunities to enhance MCS through data-driven control. Data-driven control enables effective guidance of employees’ efforts by incorporating nonfinancial indicators (for example, customer sentiment) during goal setting. It also enables timely effort and goal adjustment by facilitating real-time monitoring and feedback, as well as effective goal congruence by facilitating transparent sharing of information amongst employees. Alternatively, IBT-enabled data-driven control presents several challenges for MCS, such as demotivation of employees due to ‘surveillance’ and/or tight algorithmic control over their activities. Data-driven control also poses other challenges, including issues with data governance, quality, and security, as well as biases and explainability-related issues with control models. Legal and ethical liability concerns also arise over autonomous task execution.