Product diversity and costing system design choice: field study evidence

This study uses data collected from multiple sites to examine the implications of product diversity for costing system design choices. Product diversity is a recognized antecedent of ABC adoption. However, there is evidence that ABC is not a generic solution to costing distortions produced by product diversity. Our observations in the field indicate that the design of costing systems is not only influenced by product diversity but also by the way in which technology is used to manage diversity. Furthermore, costing systems are observed to vary in sophistication along a range of dimensions rather than between the discrete alternatives of ABC and traditional systems.