The Development of MCS Packages – Balancing Constituents’ Demands

Journal of Accounting & Organizational Change, Vol. 9 No. 2, 2013, pp. 155-187

Posted: 3 Feb 2015

See all articles by Erik R. Strauss

Erik R. Strauss

University of Witten/Herdecke

Pascal Nevries

University of Witten/Herdecke

Jürgen Weber

WHU - Otto Beisheim School of Management

Date Written: 2013

Abstract

Purpose – This study aims to consider how emerging management control systems (MCS) form the MCS package of start-up firms. Based on institutional theory, the authors aim to better understand reasons for introducing MCS and the reciprocity between the parts of the firm’s overall MCS package.

Design/Methodology/Approach – The authors apply a qualitative cross-sectional field study approach involving 74 interviews with key stakeholders in 20 young start-up firms with venture capital financing. Interview data are fully transcribed, analysed, checked, and triangulated.

Findings – The results uncover the main constituents of start-up firms in three different institutional fields (nascent, start-up, post start-up), which substantially impact on the introduction of new MCS and the subsequent MCS packages. The introduction of formal MCS seems to be divided into different phases.

Research Limitations/Implications – This study is subject to the limitations of case-based research. Moreover, the theoretical underpinning of institutional theory potentially underestimates the influence of agency on social behaviour and structures.

Practical Implications – The study highlights the major drivers of establishing a set of control systems through which the interests of different stakeholders are aligned. A multitude of concrete examples of managing controls are given, including reasons for their introduction and their effects.

Originality/Value – This paper sheds light on the introduction of MCS in young firms. This complements prior research, which has almost exclusively focused on MCS in more mature and established firms. Moreover, the authors deepen prior insights that are primarily focused on isolated formal components of MCS, by understanding MCS as a package.

Suggested Citation

Strauss, Erik R. and Nevries, Pascal and Weber, Jürgen, The Development of MCS Packages – Balancing Constituents’ Demands (2013). Journal of Accounting & Organizational Change, Vol. 9 No. 2, 2013, pp. 155-187, Available at SSRN: https://ssrn.com/abstract=2559247

Erik R. Strauss (Contact Author)

University of Witten/Herdecke ( email )

Alfred-Herrhausen-Straße 50
Witten, 58448
Germany
+492302926567 (Phone)
+492302926587 (Fax)

HOME PAGE: http://https://www.uni-wh.de/wirtscha

Pascal Nevries

University of Witten/Herdecke ( email )

Alfred-Herrhausen-Straße 50
Witten, 58448
Germany

Jürgen Weber

WHU - Otto Beisheim School of Management ( email )

Burgplatz 2
Vallender, 56179
Germany

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