Accounting information systems (AISs) are software suites that aggregate and process a company’s financial data automatically. They can reduce the burden on human accountants by quickly and efficiently performing large amounts of menial work while also ensuring compliance with reporting standards and practices such as GAAP. As such, companies worldwide are increasingly adopting them and adjusting their organizational frameworks to accommodate automatic data collection and processing.
With that said, the degree of adoption varies significantly between different industries, depending in large part on their existing affinity for information technology. Agriculture is one of the fields where the adoption of AISs is lagging behind the overall business average, possibly due to its long history of non-reliance on information technology. The purpose of this paper is to evaluate the obstacles and barriers that impede the adoption of AISs in agriculture businesses worldwide.
Literature About AIS
Since the inception of AISs, both businesses and researchers have put substantial resources into the improvement of their understanding of how they affect operations, both currently and potentially. The immediate improvements include better efficiency and utilization of human resources as routine tasks are offloaded from accountants to machines that can perform them better. However, Engemann (2018) describes some of the further-reaching results, such as cost-saving procedures and innovative data analysis.
The speed at which software can process information compared to humans makes a wide variety of analysis methods viable as they now take dramatically less time than they would before. Through approaches such as machine learning, it is also possible to identify trends that people would not be able to find otherwise. This vast potential has not been entirely realized yet, however, and the full extent of the benefits AISs bring is currently unknown.
In less theoretical terms, the overall scientific consensus is that the usage of AISs improves the financial performance of the businesses where they are adopted. The belief is that the benefits they bring outweigh the implementation and maintenance costs, especially in the long term. Considering the advantages outlined above, it is reasonable to assume that this proposition is true, especially for more advanced and well-implemented systems. With that said, Ganyam and Ivungu (2019) outline two substantial disadvantages of the current literature. The first is the general nature of the studies, many of which do not use standardized indicators and focus on general rather than financial performance. The second issue is the focus on Europe and Asia, both of which have business cultures that are well-acquainted with the usage of technology. The effects of AISs in less technologically developed regions are unclear but would likely be worse due to higher implementation costs.
The study consisted of a literature review on the topic of AIS adoption challenges in agriculture. It was qualitative in nature due to the small body of literature on the topic and the low availability of quantifiable information. The search for information was conducted using multiple databases, such as Google Scholar, JSTOR, and Web of Science. The keywords employed in the search were “accounting information systems,” “agriculture,” “barriers,” and “adoption.” Ultimately, ten suitable articles were found based on a screening of titles and abstracts. However, seven of them proved unusable based on further text analysis, as they did not contain pertinent information for the purposes of the study. The remaining three articles underwent content analysis, the results of which are presented below. Two of them journal articles, while the third is a section in a larger book that is dedicated to information systems in agriculture.
Presentation, Analysis, and Findings
Overall, the findings suggest that the implementation of AISs can enhance the performance of agriculture businesses that adopt them. Tingey-Holoyak et al. (2021) find that, though the adoption of information systems in the industry is currently lacking, in a practical environment, the usage of one has the potential to enhance decision-making and profitability. The most significant challenge is the transfer of on-farm data to the software to improve its awareness of the ongoing situation.
Agriculture is subject to numerous external factors that are challenging to quantify, such as weather and pests. As such, Tingey-Holoyak et al. (2021) used soil moisture and climate data alongside financial information to inform irrigation decisions and optimize the farm’s performance. As a result, substantial adaptations to the traditional AIS design have been necessary, incorporating information beyond what is necessary for accounting.
This lack of alignment between AISs and the agriculture industry also emerges prominently in other studies. Per Napitupulu (2018), there is a lack of high-quality, agriculture-oriented AISs, and, consequently, there is little to no standardization. As a result, companies have to exercise personal initiative in their development and implementation, which leads to mixed results. Some businesses are choosing not to employ AISs altogether because they are aware of these issues and not willing to be subjected to them.
Per Napitupulu (2018), organizational culture also plays a prominent role in the adoption of AISs, as if it does not encourage innovation, workers will be less willing to take the steps necessary to enable effective usage of the technology. As such, even if agriculture businesses have well-developed organizational cultures, a review is still warranted if they struggle with adoption.
Finally, the lack of alignment manifests itself in terms of both current AISs being inappropriate to the agriculture industry and in cultural terms. Che et al. (2020) review the application of American AIS models to contexts in Nigeria and find that in its rural agricultural settings, these methods do not apply well. Barriers include language mismatches, differences in culture, lack of knowledge on how to apply the system in the best ways, and perceived choice limitations due to receiving a finished product coming from another context.
These issues are challenging to address, as the communities in question will not necessarily have personnel capable of adapting AISs entirely or designing them from the ground up. Che et al. (2020) also note that, due to the limited alternative exposure, application understanding, and the language barrier, it is challenging to determine such users’ reasons for adoption resistance. As such, a solution that comes from within the community would be substantially better suited to solving the issue.
Conclusion and Recommendations
Since their inception, AISs have developed dramatically and spread throughout many different industries. They have the extensive potential for the improvement of business performance, though the topic has not currently been studied adequately. More research into the applications of AISs for analysis and the financial outcomes of their usage is necessary. In terms of agriculture, specifically, the primary barrier to adoption is the lack of compatibility between traditional AISs and companies in the agriculture sector.
The software does not address the businesses’ needs, and the farms do not have the technological sophistication to accommodate it. Additionally, most AIS is based on Western paradigms and approaches, which do not necessarily apply to the rest of the world. As a result, agriculture businesses there do not receive the same benefits and are less willing to adopt the software as a result.
The first recommendation for the alleviation of this issue would be to research the specific business circumstances of agricultural companies worldwide and their relevance to AIS operations. Based on the findings, more specialized software that responds to the industry’s specific needs and can be more standardized can be developed. As a result, the need for personal initiative and innovation will be mitigated, making the software easier to adopt. The second recommendation would be to promote the local development of IT literacy and software development. Local developers will be able to take the unique needs of their communities into account better, developing fundamentally more suitable AISs as a result. Internationally proven best practices can then be integrated into it, helping those local programs achieve excellent performance.
Che, F. N., Strang, K. D., & Vajjhala, N. R. (2020). Opportunities and strategic use of agribusiness information systems. IGI Global.
Engemann, K. J. (Ed.). (2018). The Routledge companion to risk, crisis and security in business. Taylor & Francis.
Ganyam, A. I., & Ivungu, J. A. (2019). Effect of accounting information system on financial performance of firms: A review of literature. Journal of Business and Management, 21(5), 39-49.
Napitupulu, I. H. (2018). Organizational culture in management accounting information system: Survey on state-owned enterprises (SOEs) Indonesia. Global Business Review, 19(3), 556-571.
Tingey-Holyoak, J., Pisaniello, J., Buss, P., & Mayer, W. (2021). The importance of accounting-integrated information systems for realising productivity and sustainability in the agricultural sector. International Journal of Accounting Information Systems, 41. Web.