The effect of service process type, business strategy and life cycle stage on bureaucratic MCS in service organizations

The effect of service process type, business strategy and life cycle stage on bureaucratic MCS in... This study uses the survey method to investigate the influence of several contingent variables on the design of MCS in service organizations. MCS was conceptualized in terms of five dimensions: action/results controls, formal/informal controls, tight/loose controls, restricted/flexible controls, and impersonal/interpersonal controls to form a composite measure of the degree of MCS bureaucracy. The framework used in this study recognizes that the service process type, business strategy, and stage in the organizational life cycle influence the choice of MCS design within an organization. Questionnaires were administered to financial controllers of service organizations operating in Australia. Using t tests and multiple regression analysis, the results indicated that (1) mass service, mature and cost leader firms place a greater emphasis on more bureaucratic forms of MCS, compared to professional service, growth and differentiator firms, and (2) service process type, organizational life cycle stage, and business strategies have a significant influence on the design of a firm's MCS. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Management Accounting Research Elsevier

The effect of service process type, business strategy and life cycle stage on bureaucratic MCS in service organizations

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Publisher
Elsevier
Copyright
Copyright © 2005 Elsevier Ltd
ISSN
1044-5005
DOI
10.1016/j.mar.2005.04.003
Publisher site
See Article on Publisher Site

Abstract

This study uses the survey method to investigate the influence of several contingent variables on the design of MCS in service organizations. MCS was conceptualized in terms of five dimensions: action/results controls, formal/informal controls, tight/loose controls, restricted/flexible controls, and impersonal/interpersonal controls to form a composite measure of the degree of MCS bureaucracy. The framework used in this study recognizes that the service process type, business strategy, and stage in the organizational life cycle influence the choice of MCS design within an organization. Questionnaires were administered to financial controllers of service organizations operating in Australia. Using t tests and multiple regression analysis, the results indicated that (1) mass service, mature and cost leader firms place a greater emphasis on more bureaucratic forms of MCS, compared to professional service, growth and differentiator firms, and (2) service process type, organizational life cycle stage, and business strategies have a significant influence on the design of a firm's MCS.

Journal

Management Accounting ResearchElsevier

Published: Dec 1, 2005

References

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