Institutional theory, theoretical triangulation and a case study of activity-based costing

What is it about?

This study of why and how a Portuguese telecommunications company implemented ABC is extends the institutional theory model of accounting change by Jesse Dillard by incorporating facets of labour process theory to explain resistance to it, and actor network theory to explain how ABC became a working technology. The reasons for adopting ABC were coercive (from EU regulators), mimicry (imitating practices of leading firms) and normative (advice from consultants) however all were in the name of economic efficiency. The same consultants were central as they advised all parties.

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Why is it important?

First the paper seeks to illustrate the benefits of a particular form of theoretical triangulation. Second the paper challenges institutional theory assumptions that non-economic factors drive change for in the case coercion, mimicry and normative pressures were all in the name of efficiency, albeit to gain legitimacy from regulators. Third the paper draws attention to how EU regulators (advised by epistemic communities of consultants) have recommended ABC in utility companies.