The Impact of Society on Management Control Systems

Scandinavian Journal of Management, Vol. 33, Issue 4, pp. 253-266, 2017

Posted: 26 Sep 2017 Last revised: 26 Nov 2017

See all articles by Jan Greve

Jan Greve

Örebro University - School of Business

Christian Ax

University of Gothenburg - School of Business, Economics and Law

David S. Bedford

University of Technology Sydney (UTS)

Piotr Bednarek

Uniwersytet Ekonomiczny we Wrocławiu

Rolf Brühl

ESCP Europe Business School Berlin

Johan Dergard

Lund University

Angelo Ditillo

Bocconi University - Department of Accounting; SDA Bocconi

Andrea Dossi

SDA Bocconi; Bocconi University - Department of Accounting

Maurice Gosselin

Université Laval

Sophie Hoozée

Ghent University - Department of Accountancy and Corporate Finance

Poul Israelsen

Aalborg University - Center for Industrial Production

Otto Janscheck

University of Vienna

Daniel Johanson

Norwegian School of Economics (NHH)

Tobias Johansson

Örebro University - School of Business

Dag Øivind Madsen

University of South-Eastern Norway

Teemu Malmi

Aalto University School of Business

Carsten Rohde

Copenhagen Business School

Mikko Sandelin

Aalto University - Department of Accounting and Finance

Torkel Strömsten

Stockholm School of Economics

Thomas Toldbod

Aalborg University

Jeanette Willert

Copenhagen Business School

Date Written: September 14, 2017

Abstract

The aim of this study is to investigate whether certain configurations of management controls dominate in certain societies (socio-cultural contexts) and whether the effectiveness of a given archetype of management control systems (MCSs) varies depending on the socio-cultural setting—the society—in which it operates. The study focuses on three socio-cultural groups and the corresponding institutional contexts (an Anglo-Saxon group, a Central European group, and a Northern European group) and three MCS archetypes (delegated bureaucratic control, delegated output control, and programmable output control). We use unique data from a cross-national, interview-based survey encompassing 610 strategic business units from nine countries (seven European countries plus Canada and Australia). The idea that firms tend to adapt MCSs to the socio-cultural context does not gain empirical support in this study. No significant differences in the distribution of MCSs between the three socio-cultural groups are noted. However, we do find that programmable output control has a more positive impact on effectiveness in Anglo-Saxon cultures, while delegated output control has a more positive impact on effectiveness in Northern Europe. Taken together these findings indicate that distinct differences between societies make a particular MCS design more appropriate in a given society, but where such differences are not dramatic (as in the present case), multiple MCS designs can be found in the same society.

Keywords: societal institutions, business systems, contingency framework, bureaucratic control, output control

JEL Classification: M41

Suggested Citation

Greve, Jan and Ax, Christian and Bedford, David S. and Bednarek, Piotr and Brühl, Rolf and Dergard, Johan and Ditillo, Angelo and Dossi, Andrea and Gosselin, Maurice and Hoozée, Sophie and Israelsen, Poul and Janscheck, Otto and Johanson, Daniel and Johansson, Tobias and Madsen, Dag Øivind and Malmi, Teemu and Rohde, Carsten and Sandelin, Mikko and Strömsten, Torkel and Toldbod, Thomas and Willert, Jeanette, The Impact of Society on Management Control Systems (September 14, 2017). Scandinavian Journal of Management, Vol. 33, Issue 4, pp. 253-266, 2017, Available at SSRN: https://ssrn.com/abstract=3042465

Jan Greve (Contact Author)

Örebro University - School of Business ( email )

SE-701 82
Sweden

Christian Ax

University of Gothenburg - School of Business, Economics and Law ( email )

Vasagatan 1
Po Box 610
Goteborg, 40530
Sweden

David S. Bedford

University of Technology Sydney (UTS) ( email )

15 Broadway, Ultimo
PO Box 123
Sydney, NSW 2007
Australia

Piotr Bednarek

Uniwersytet Ekonomiczny we Wrocławiu ( email )

Komandorska 118/120
Wrocław, 53-345
Poland

Rolf Brühl

ESCP Europe Business School Berlin ( email )

Heubnerweg 8-10
Berlin, 14059
Germany

Johan Dergard

Lund University ( email )

Box 117
Lund, SC Skane S221 00
Sweden

Angelo Ditillo

Bocconi University - Department of Accounting ( email )

Via Roentgen 1
Milan, 20136
Italy

SDA Bocconi ( email )

Via Bocconi 8
Milan, Milan 20136
Italy

Andrea Dossi

SDA Bocconi ( email )

Via Bocconi 8
Milan, Milan 20136
Italy

Bocconi University - Department of Accounting

Via Roentgen 1
Milan, 20136
Italy

Maurice Gosselin

Université Laval ( email )

2214 Pavillon J-A. DeSeve
Quebec, Quebec G1K 7P4
Canada

Sophie Hoozée

Ghent University - Department of Accountancy and Corporate Finance ( email )

Sint-Pietersplein 7
Ghent, 9000
Belgium

Poul Israelsen

Aalborg University - Center for Industrial Production ( email )

Fibigerstræde 16
Aalborg, 9220
Denmark

Otto Janscheck

University of Vienna ( email )

Bruenner Strasse 72
Vienna, Vienna 1090
Austria

Daniel Johanson

Norwegian School of Economics (NHH) ( email )

Helleveien 30
Bergen, NO-5045
Norway

Tobias Johansson

Örebro University - School of Business ( email )

Örebro, SE-701 82
Sweden

Dag Øivind Madsen

University of South-Eastern Norway ( email )

Bredalsveien 14
Hønefoss, Buskerud 3511
Norway

Teemu Malmi

Aalto University School of Business ( email )

P.O. Box 21220
Aalto, 00076
Finland
+358 40 5100827 (Phone)

Carsten Rohde

Copenhagen Business School ( email )

Solbjerg Plads 3
Frederiksberg C, DK - 2000
Denmark

Mikko Sandelin

Aalto University - Department of Accounting and Finance ( email )

P.O. Box 1210
Helsinki, 00100
Finland
+358 9 4313 8457 (Phone)
+358 9 4313 8678 (Fax)

Torkel Strömsten

Stockholm School of Economics ( email )

PO Box 6501
Stockholm, 11383
Sweden

Thomas Toldbod

Aalborg University ( email )

Fredrik Bajers Vej 7E
Aalborg, DK-9220
Denmark

Jeanette Willert

Copenhagen Business School ( email )

Solbjerg Plads 3
Frederiksberg C, DK - 2000
Denmark

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