Role Of Management Control Systems Research Articles

Pengaruh Gaya Kepemimpinan terhadap Komitmen Organisasional (Sistem Pengendalian Manajemen sebagai Variabel Moderasi)

The purpose of this study is to fill the gap in the management accounting literature by integrating the role of management control systems on leadership style and organizational commitment. Data collection techniques in this study used an online survey by distributing the questionnaires to management accountants throughout Indonesia. SEM-PLS was used to test the hypothesis with a sample size of 158. The results showed that elements of formal and informal control systems, such as outcomes, actions, personnel and culture, influenced leadership behavior and the development of organizational commitment. Keywords: management control system, leadership style, initiation structure, consideration, organizational commitment.

Research on Corporate Sustainability: Review and Directions for Future Research

We review the literature on corporate sustainability and provide directions for future research. Our review focuses on three actions: measuring, managing and communicating corporate sustainability performance. Measurement is the least developed of the three and represents promising opportunities for research. Compelling evidence now exists on the role of management control systems, investor pressure and mandated disclosure in improving corporate sustainability outcomes. Research has moved beyond weighing the importance of all sustainability issues equally, with recent studies drawing distinctions between the financial materiality of different sustainability issues. Collectively, this new line of inquiry suggests that improving performance on material sustainability metrics is related to improved financial performance, helping to resolve four decades of inconclusive evidence on the relation between sustainability and financial outcomes. Finally, we review research on how disclosure mediums, accounting standards, information monitors and intermediaries shape the communication of sustainability performance. We conclude with a call for research on how to measure performance in the 21st century when corporate purpose extends beyond shareholder value maximization.

How Top Managers Use the Entrepreneurial Gap to Drive Strategic Change

Prior research provides strong evidence for the association between business strategy and the design and use of management control systems. We complement this research by examining the role of management control systems in situations of strategic change. We report the results of an in-depth longitudinal field study of Henkel, a German multinational company, from 2008 through 2013. During this period, the company declared a new strategy. To implement this strategy, senior management purposefully misaligned span of control and span of accountability – labeled the entrepreneurial gap – to stimulate individual initiative and higher levels of performance. Our description of how top managers enacted change suggests a strong relationship between management control systems, organizational structure, and cultural norms that together support desired outcomes. In addition, we provide evidence on the timing and sequencing of actions by top management. By the end of our study period, Henkel was a top performer in its various markets and was leading the German blue-chip index in stock returns.

Transformational Leadership’s Impact on Organizational Innovation: The Mediating Role of Management Control System

Contemporary organizations are made up of various tangible and intangible components. While several of these components have been subjected to a variety of scholarly studies, both individually and in relation to one another, a number of organizational components still require deeper investigation. The present study looks at the direct and indirect effects of transformational leadership (TL) on organizational innovation (OI) through management control system (MCS) as a mediating variable. This objective has been achieved through an exhaustive review of the literature on the impacts of TL and MCS on OI. The data were collected through questionnaire distribution among 400 high-level managers of seven universities in Saudi Arabia, within the period of May–July 2019. Subsequently, 264 surveys were acquired for the final analysis, indicating 66 per cent accuracy in the response rate. Furthermore, Partial least squares SmartPLS 3.0 used to assess the measurement model and the structural model. It is revealed that TL and MCS have a significant correlation with OI. However, the levels of influence of TL and MCS are quite different in terms of the influence on OI. Finally, our study proposes a few future studies for the research scholars and practitioners.

The mediating role of management control system characteristics in the adoption of management accounting techniques

PurposeThis study aims to investigate the mediating role of management control system (MCS) characteristics in the relationship between state type, reflected through societal institutions (SIs), and two sets of management accounting techniques (MATs), namely, performance measurement techniques (PMTs) and cost measurement techniques (CMTs).Design/methodology/approachStructural equation modeling was used to analyze data from a cross-sectional survey of 136 firms in the United Arab Emirates (UAE).FindingsThe findings show a direct positive impact of state-type construct on MCS characteristics, and that MCS characteristics partially mediate the reported significant relationships between state type and the use of PMTs. While the findings show a similar positive relationship between state type and CMTs, MCS characteristics do not mediate this relationship.Research limitations/implicationsAlthough these results are affected by limitations associated with the survey method used, they are useful in explaining the necessary conditions supporting the use of MATs in general and performance measurement techniques in particular.Practical implicationsThe study uses a cross-section of companies in the UAE, an attractive global investment destination, as its sample. The results can help investors better understand the choice of MATs in the UAE and its relation to MCS characteristics.Originality/valueThis study contributes to management accounting literature by determining the mediating role of MCS characteristics on the relationship between state type and the choice of two sets of MATs, whereas existing literature assumes a direct relation between the two.

The role of management control systems in the performance of higher education through good university governance

Management control systems (MCSs) encourage university management to focus on achieving the expected performance. Unfortunately research on MCS in the public sector, has been very limited especially in the universities. It has been argued that MCS affects the Performance of Higher Education albeit in a weak manner. However, there are certain other variables that influence the role of MCS on higher education performance. Good university governance (GUG) is one of them. Kim (2008) states that GUG factors determine the success of management, quality control and organisational performance. This study seeks to examine the role of GUG under the influence of MCS on Performance. A study of 70 undergraduate accounting study programs in Indonesia using structural equation model has shown that MCS does affect performance. The effect is more pronounced with GUG being a mediator between MCS and performance. This suggests that the role of GUG should be optimised to enhance the role of MCS.

THE ROLE OF MANAGEMENT CONTROL SYSTEMS IN THE PERFORMANCE OF HIGHER EDUCATION THROUGH GOOD UNIVERSITY GOVERNANCE

Management control systems (MCSs) encourage university management to focus on achieving the expected performance. Unfortunately research on MCS in the public sector, has been very limited especially in the universities. It has been argued that MCS affects the Performance of Higher Education albeit in a weak manner. However, there are certain other variables that influence the role of MCS on higher education performance. Good university governance (GUG) is one of them. Kim (2008) states that GUG factors determine the success of management, quality control and organisational performance. This study seeks to examine the role of GUG under the influence of MCS on Performance. A study of 70 undergraduate accounting study programs in Indonesia using structural equation model has shown that MCS does affect performance. The effect is more pronounced with GUG being a mediator between MCS and performance. This suggests that the role of GUG should be optimised to enhance the role of MCS.

The Role of Management Control Systems between Entrepreneurship of Middle-Level Mangers and Organizational Performance

The Role of Management Control Systems between Entrepreneurship of Middle-Level Mangers and Organizational Performance

Peran Levers of Control Terhadap Hubungan Antara Perencanaan Strategis dan Kinerja UMKM

This study investigates the role of levers-of-control (LOC) based controlling system in the strategy formulation and MSME performance relationship in Samarinda. Through a survey conducted on the leadership (controller) of MSMEs in Samarinda City, this study evidenced the role of management control systems in the strategy formulation and MSME performance relationship. Of the 49 responses of MSME leaders, processed using PLS-SEM analysis, this study provided empirical evidence that the strategy formulation had a positive relationship with MSME performance. In addition, the indirect relationship between the two (mediation) through LOC-based management system supported the mediation hypothesis that the LOC-based management control system affects the strategy formulation and MSME performance relationship. In other words, it can be concluded that the management control system can increase the strategy formulation role that leads to MSME performance betterment.

Lean Management, Competitive Advantage, and Firm Performance: The Role of Management Control Systems (Evidence from Indonesia Manufacturing Firms)

The purpose of this paper is to examine the role of management control systems (MCS) to support the implementation of lean management strategy to achieve competitive advantage and improve firm performance. Data collected using a questionnaire survey. A total of 123 managers in manufacturing firms participated in this study. Data were analyzed using structural equation models. The results show that a lean management strategy is positively and significantly related to MCS and competitive advantage; MCS has a positive and significant effect on competitive advantage and firm performance. Furthermore, these results show that MCS serves as a mediating variable to the relationship between lean management and competitive advantage, and firm performance. The results of the study show the role of lean MCS as an integral part of lean management to achieve competitive advantage and improve firm performance. This result is the initial evidence of how MCS mediates the relationship between lean management strategy, competitive advantage, and firm performance.

Levers of control, management innovation and organisational performance

Purpose This study aims to reinforce the important role of management control systems (MCSs) in managing change through adopting a unique approach to the conceptualisation of Simons’ (1995) levers of control, specifically focussing on the enabling (beliefs and interactive) and constraining (boundary and diagnostic) levers of control and empirically examining their association with management innovation and organisational performance. Design/methodology/approach A mail survey questionnaire was used to collect data, with the Dillman (2007) tailored design method used in regards to the development of questions, and the personalisation and distribution procedures. A total of 645 questionnaires were distributed to either the Financial Controller or Chief Financial Officer of manufacturing business units identified in the OneSource database. Findings The findings reveal that the use of enabling controls was directly associated with organisational performance and with three management innovation dimensions (new structures, processes and practices) with new structures positively associated with organisational performance. It was also found that the use of constraining controls was indirectly, through the extent of adoption of new management techniques, associated with organisational performance. Practical implications The findings have important implications for managers in respect to how they use controls to enhance innovation and organisational performance. Originality/value The findings highlight the importance of the use of MCS, specifically both enabling and constraining controls, in facilitating change (management innovation) and performance. Hence, the findings provide empirical evidence in support of Simons’ (1995, 2000) theoretical assertion that the levers coexist to provide benefits to organisations.

Entrepreneurial Orientation, Firm Performance, and the Moderating Role of Management Control Systems

In this paper, we consider the concept of entrepreneurial orientation (EO) as a potential determinant of performance. Although numerous authors have noted this relationship, the literature indicate...

Bridging management control systems and innovation

PurposeThe purpose of this study is to present the evolution of thinking on the role of management control systems (MCSs) in innovation, according to the development of control practices, and to provide a reflection on the achievements of the more recent literature.Design/methodology/approachThis paper assesses articles, books and book chapters that have explored MCSs in innovation, together with seminal works on management accounting and control.FindingsMoving from the traditional phase where MCSs were seen as detrimental to innovation, the literature has now reached a new consensus that attributes a positive role to control. In this recent phase, it arises from the literature that MCSs in the realm of innovation should embrace a multiplicity of controls; MCSs depend on the magnitude and innovation mode of a company; MCSs evolve over time; and that synergies and tensions are expected to arise. Adding these factors to the inherent complexity of innovation, the assertion is that qualitative approaches should be undertaken to infuse the field with more fine-grained evidence. It is also proposed that this methodological approach be used to address the following points: (1) the use of multiple controls; (2) synergies and tensions; and (3) behavioural aspects of controls in relation with innovation.Originality/valueThe paper is of value for researchers who have an interest in studying the use of MCSs in innovation and in qualitative research and proposes some areas of research that could be explored.

Family Management and Firm Performance in Family SMEs: The Mediating Roles of Management Control Systems and Technological Innovation

The aim of this research is to analyze the mediating role of the use of management control systems (MCS) and the achievement of technological innovation (TI) in the relationship between family management and firm performance in family small and medium-sized enterprises (SMEs). A questionnaire was conducted by 617 managers of family SMEs in Spain, and our model was tested using partial least squares. Our findings show that both MCS and TI play crucial mediating roles in the understanding of the relationship between family management and firm performance. As a result, family-managed firms that utilize MCS and produce TI are much more likely to generate better performance. These results encourage family managers to use formal MCS because in that way they will contribute to obtaining better firm performance, directly and indirectly through TI. We focus on private family SMEs, because these specific firms contribute significantly to the economies worldwide. This paper contributes to resolve the controversy regarding the relationship between family management and firm performance introducing MCS and TI as mediating factors.

Exploring the transformative potential of management control systems in organisational change towards sustainability

PurposeThe purpose of this paper is to examine the role of management control systems (MCS) in organisational change towards sustainability. In particular, it examines the extent to which MCS may be instrumental in transformative organisational change in this sphere.Design/methodology/approachThrough an in-depth case study of an Australian multinational corporation in the property sector, this paper explores the possibilities for MCS to influence organisational change towards a multi-bottom-line, balanced approach to social and environmental challenges facing corporations. MCS are conceptualised using Simons’ (1995) Levers of Control framework. On the question of sustainability, the approach adopted in this paper contrasts with much of the prior literature that largely takes a predominantly pragmatist approach and equates sustainability performance with financial performance. The prior literature generally reports a positive role for MCS in organisational change efforts. By contrast, drawing on the typology developed by Hopwood et al. (2005), this paper views sustainability as requiring a balancing of economic, social and environmental concerns.FindingsThe findings indicate that although MCS are not irrelevant, they do not play a transformative role in enabling deep-seated organisational change towards sustainability. The critical literature on the nature of MCS is drawn upon to explore the reasons for the observed non-role.Originality/valueThe analysis sheds light on factors that may influence the effectiveness of conventional notions of MCS in organisational change. The findings contribute to the debate regarding the suitability of continued efforts at using conventional notions of management accounting and MCS in enabling organisational change towards greater social and environmental sustainability. The paper also highlights the value of a critical examination of the usefulness of management accounting and control practices in the context of organisational change towards sustainability.

The “betrayal effect” on post-acquisition integration

PurposeThis paper aims to draw on Latour’s (1991) conceptual “performative” framework to investigate the role of management control systems (MCSs) in the establishment of post-acquisition integration. The study adopts a qualitative case study approach, where data are collected and analysed from an Australian company which had recently completed a number of acquisitions. Findings demonstrate the performative powers and effects of MCSs, which contribute to shaping customer and sales integration activities, including the forms some resistance may take. In this case, a bitter betrayal was perceived to have occurred in an early stage of the merger, and this paper argues that the use of a performative theoretical framework has enabled subsequent post-acquisition integration strategies to be rendered more visible and thus actionable.Design/methodology/approachThe study adopts a qualitative approach where data are collected and analysed from an Australian case study company which had recently completed a number of acquisitions. Research methods used include semi-structured interviews, a review of archival documents and observations to capture daily integration activities and practices of actors operating in the company.FindingsFindings demonstrate the performative powers and effects of MCSs, which structure customer and sales integration activities and make post-acquisition integration relations strategy visible and actionable.Research limitations/implicationsFindings are only on one case study, and there is a need to undertake further detailed case studies across a range of industries and timeframes, plus, where possible, revisit such studies post hoc to assess the stability of success of the integration.Practical implicationsIntegration strategy and strategic change may be constituted by non-human actants such as MCSs. Practitioners who are engaged in acquisitions and making integration decisions need to recognise that MCSs do not merely play a subordinate role to integration strategies, but rather is an important moderating variable that play an active role in their formulation, configuration and enactment.Originality/valueA performative approach is taken to provide a broader analytical framework for analysing the construction and sustaining of post‐acquisition integration relations, where there is no distinction between technical and social dimensions of action but, rather, the two are merged. This makes it possible to overcome the limitations inherent in existing theoretical frameworks. Using this approach, integration relations involve construction of a network of entities that are enrolled to support, create and sustain the integration.

THE IMPACT OF MANAGEMENT CONTROL SYSTEMS (MCS) ON ORGANIZATIONS PERFORMANCE A LITERATURE REVIEW

The impact of management control systems (MCS) on organizations performance empirical research has been the subject of numerous studies during the past decade in developed and emerging economies. In the contemporary competitive, complex and changing global business environment, firms are being challenged to adopt business models that enable them to address the strategic uncertainties and risks they face in their business environments. The main issue of this study is that management accounting researchers argue that one of the ways firms can continually rejuvenate themselves to survive and succeed in these complex and uncertain environments is to understand the role of management control systems in Formulating a business strategy in management control systems that yields a sustainable competitive advantage which in turn lead to enhance organizations performance. The purpose of this study is attempting to wading in the literature review related to The impact of management control systems on organizations performance based on 10 articles published in a wide variety of journals. 
 Discuss some methodological issues related to stage in the organizational life cycle and, finally, review the main results related to this topic and provide suggestions for future research Literatures indicate several factors that could possibly influence management control systems and organizations performance. It is worth highlighting the numerous factors as it is possible to conduct the proper orientation of influence of management control systems on performance.

Disentangling the Role of Management Control Systems for Product and Process Innovation in Different Contexts

ABSTRACTThis paper studies the relationship between the use of management control systems and different types of innovation (product and process), taking into account innovation contexts (high-tech versus low-tech sectors). We develop and test our hypotheses based on a large sample of Spanish manufacturing firms and find that input controls have a positive association only with process innovation in both innovation contexts. Behavior controls have similar effects on both types of innovation outcomes for high-tech firms, while they have stronger positive associations with process than with product innovation for low-tech firms. Output controls are equally relevant for product and process innovation in both contexts.

Top management teams’ shared leadership and ambidexterity: the role of management control systems

The study explores how top management teams’ shared leadership is related to organizational ambidexterity in public-sector organizations, theoretically and empirically considering how this relationship is contingent on the management control system. Using a sample of 85 Swedish municipal housing corporations, we find that shared leadership has a positive relationship with organizational ambidexterity in public-sector organizations. Moreover, increasing use of new public management control systems, based on combined reward and performance controls, positively moderates this relationship. The study also finds that traditional public management control systems, based on combined planning and administrative controls, do not moderate the relationship between top management teams’ shared leadership and organizational ambidexterity. Accordingly, this article contributes to the public and strategic management literature, as well as to managerial practice. Points for practitioners The article suggests that sharing leadership within top management teams can result in a balanced resource allocation in municipal corporations. To be more effective in achieving this balance, public sector managers might consider emphasizing new public management-inspired management control systems and de-emphasizing those of a more traditional type.

Role of Management Control Systems in Quality, Innovation and Organizational Performance in Portugal SMES Companies

The purpose of this research is to analyze the relationship between management control systems, total quality management (TQM) and innovation, and also the effects of management control systems in the organizational performance. The research was developed based on a conceptual model designed to analyze these dimensions. The data were obtained through an online questionnaire, sent to small and medium-sized Portuguese companies, having been conducted the study based on responses received from 287 valid questionnaires, and using a multivariate statistical analysis for the statistical development. The findings indicate that non-financial indicators provide innovation strategies of products and processes. However, the financial indicators only provide the innovation strategies of processes. It is also verified that only non-financial indicators provide equally the implementation of TQM practices. The results also show that financial indicators only provide an improvement in the financial results of the organization, while the non-financial indicators also improve its operational performance.