The purpose of this research is to describe the accounting software modules required by a manufacturing company in the contemporary production environment. The introduction of high- tech into the manufacturing process creates changes which render many traditional cost accounting procedures either ineffective, or irrelevant, or both ineffective and irrelevant. As a consequence, the introduction of high-tech into the production process has, in most manufacturing companies, been accompanied by a significant shift in emphasis in manufacturing management. In the recent past, the emphasis in manufacturing management was on materials inventories, ordering and production lead times, labor and material efficiency, workinprogress (WIP) levels, finished goods inventories, and so forth. The emerging emphasis in American manufacturing is on justintime (JIT) techniques. JIT production techniques emphasize the elimination of waste, which is defined as "any activity performed within a manufacturing company which does not add value to the product" (Maskell, 1986b, p. 32). Within the parameters of this definition of waste are inventories, materials handling, quality problems, queues, shop floor delays, lead times, and unnecessary clerical and accounting procedures (Maskell, 1986a). The elimination or minimization of inventories, lead times, and so forth creates a need for radical changes in traditional cost accounting procedures.
Production Management Changes & Cost Accounting
JIT is a radically different production management philosophy from that traditionally employed (Sadhwani, Sarhan, & Kiringoda, 1985). JIT demands (1) flexibility on the shop floor, and (2) flexibility in cost accounting practices (Holbrook, 1985), because many traditional characteristics of the production process must be either eliminated or altered to a significant extent. These characteristics are as follows (Maskell, 1986b):
1. WIP is eli...