5 -1 9 1 -0 3 0
REV: MARCH 29, 2018
TEACHING NOTE
Automation Consulting Services
Teaching Objectives
1. To serve as a vehicle for the instructor to present an overview or summary of concepts covered
in a course on performance measurement and control systems.
2. To allow students to integrate and use the Levers of Control analytic framework to prepare a
set of recommendations for installing management control systems in a small but growing firm.
Case Synopsis
This case illustrates the management control challenges that are associated with rapid growth and
geographic expansion. The case is situated at an off-site Executive Committee Retreat. The three
founding partners of a technical consulting firm are grappling with several difficult questions and
problems: 1) the tension between local office autonomy, entrepreneurship, and the need for a unified
firm strategy; 2) the increasing need for standardized ways to monitor rising costs, capacity utilization,
and new business development; and 3) the evolving role of the Executive Committee and of formal
systems as the partnership continues to grow.
Assignment Question
1. How should the ACS founders deal with the problems they have identified? Be as specific
as possible in making recommendations for each of the four offices.
Case Background and Theory
For background reading that describes the concepts and theory illustrated in this case, see Robert
Simons Strategy Execution series available through Harvard Business School Publishing at
hbsp.harvard.edu/strategyexecution. Each module in the Strategy Execution series is designed so that
it can be used individually. Taken together, however, the modules form a complete course, building
on each other to teach the implementation of strategy through performance management and control
systems. Modules 1 - 4 set out the foundations for strategy implementation. Modules 5 - 10 provide
, 191-030 Teaching Note—Automation Consulting Services
quantitative tools for performance measurement and control. Modules 11 - 15 illustrate the use of these
techniques by managers to achieve profit goals and strategies.
In particular, this case illustrates concepts described in the following modules which can be
assigned with the case:
• Strategy Execution Module 15: Using the Levers of Control to Implement Strategy (HBS No.
117-115) available at https://cb.hbsp.harvard.edu/cbmp/product/117115-PDF-ENG.
This case allows students to consider if and how to implement one or more of the following types
of formal control systems covered in an MBA course on performance measurement and control
systems.
Internal Control Systems The plan of organization, procedures, and policies designed to (1)
safeguard assets from theft or accidental loss and (2) ensure reliable accounting records and financial
information systems. These controls rely on standard operating procedures and compliance audits to
ensure segregation of duties, adequate documentation, written authorizations, physical security, and
reliable management information systems.
Beliefs Systems Explicit set of shared beliefs that define basic values, purpose, and direction
including (1) how value is created; (2) level of desired performance; and (3) human relationships.
Beliefs systems are created to provide momentum and guidance to opportunity-seeking behaviors.
Beliefs systems are embodied in mission statements, vision statements, credos, and Statements of
Purpose.
Boundary Systems Formally stated limits and rules which must be respected. These systems allow
individual creativity within defined limits of freedom. Boundary systems are implemented through
clear rules, limits, and proscriptions in codes of business conduct, strategic planning systems, and asset
acquisition systems.
Diagnostic Control Systems Feedback systems used to monitor organizational outcomes and correct
deviations from preset standards of performance. Common diagnostic controls systems include profit
plans and budgets, goals and objectives systems, project monitoring systems, brand revenue
monitoring systems, and strategic planning systems. These systems (1) allow effective resource
allocation, (2) define goals, (3) provide motivation, (4) establish guidelines for corrective action, (5)
allow ex post evaluation, and (6) free top management attention.
Interactive Control Systems Control systems that managers use to regularly and personally involve
themselves in the decision activities of subordinates. Examples of systems that can be used interactively
include profit planning systems, project management systems, and brand revenue systems. Managers
make a (diagnostic) system interactive by:
1. ensuring that data generated by the system is an important and recurring agenda to discuss
with subordinates;
2. ensuring that the system is a focus of regular attention by operating managers throughout the
organization;
3. participating in face-to-face meetings with subordinates; and,
4. continually challenging and debating data, assumptions, and action plans.
2
REV: MARCH 29, 2018
TEACHING NOTE
Automation Consulting Services
Teaching Objectives
1. To serve as a vehicle for the instructor to present an overview or summary of concepts covered
in a course on performance measurement and control systems.
2. To allow students to integrate and use the Levers of Control analytic framework to prepare a
set of recommendations for installing management control systems in a small but growing firm.
Case Synopsis
This case illustrates the management control challenges that are associated with rapid growth and
geographic expansion. The case is situated at an off-site Executive Committee Retreat. The three
founding partners of a technical consulting firm are grappling with several difficult questions and
problems: 1) the tension between local office autonomy, entrepreneurship, and the need for a unified
firm strategy; 2) the increasing need for standardized ways to monitor rising costs, capacity utilization,
and new business development; and 3) the evolving role of the Executive Committee and of formal
systems as the partnership continues to grow.
Assignment Question
1. How should the ACS founders deal with the problems they have identified? Be as specific
as possible in making recommendations for each of the four offices.
Case Background and Theory
For background reading that describes the concepts and theory illustrated in this case, see Robert
Simons Strategy Execution series available through Harvard Business School Publishing at
hbsp.harvard.edu/strategyexecution. Each module in the Strategy Execution series is designed so that
it can be used individually. Taken together, however, the modules form a complete course, building
on each other to teach the implementation of strategy through performance management and control
systems. Modules 1 - 4 set out the foundations for strategy implementation. Modules 5 - 10 provide
, 191-030 Teaching Note—Automation Consulting Services
quantitative tools for performance measurement and control. Modules 11 - 15 illustrate the use of these
techniques by managers to achieve profit goals and strategies.
In particular, this case illustrates concepts described in the following modules which can be
assigned with the case:
• Strategy Execution Module 15: Using the Levers of Control to Implement Strategy (HBS No.
117-115) available at https://cb.hbsp.harvard.edu/cbmp/product/117115-PDF-ENG.
This case allows students to consider if and how to implement one or more of the following types
of formal control systems covered in an MBA course on performance measurement and control
systems.
Internal Control Systems The plan of organization, procedures, and policies designed to (1)
safeguard assets from theft or accidental loss and (2) ensure reliable accounting records and financial
information systems. These controls rely on standard operating procedures and compliance audits to
ensure segregation of duties, adequate documentation, written authorizations, physical security, and
reliable management information systems.
Beliefs Systems Explicit set of shared beliefs that define basic values, purpose, and direction
including (1) how value is created; (2) level of desired performance; and (3) human relationships.
Beliefs systems are created to provide momentum and guidance to opportunity-seeking behaviors.
Beliefs systems are embodied in mission statements, vision statements, credos, and Statements of
Purpose.
Boundary Systems Formally stated limits and rules which must be respected. These systems allow
individual creativity within defined limits of freedom. Boundary systems are implemented through
clear rules, limits, and proscriptions in codes of business conduct, strategic planning systems, and asset
acquisition systems.
Diagnostic Control Systems Feedback systems used to monitor organizational outcomes and correct
deviations from preset standards of performance. Common diagnostic controls systems include profit
plans and budgets, goals and objectives systems, project monitoring systems, brand revenue
monitoring systems, and strategic planning systems. These systems (1) allow effective resource
allocation, (2) define goals, (3) provide motivation, (4) establish guidelines for corrective action, (5)
allow ex post evaluation, and (6) free top management attention.
Interactive Control Systems Control systems that managers use to regularly and personally involve
themselves in the decision activities of subordinates. Examples of systems that can be used interactively
include profit planning systems, project management systems, and brand revenue systems. Managers
make a (diagnostic) system interactive by:
1. ensuring that data generated by the system is an important and recurring agenda to discuss
with subordinates;
2. ensuring that the system is a focus of regular attention by operating managers throughout the
organization;
3. participating in face-to-face meetings with subordinates; and,
4. continually challenging and debating data, assumptions, and action plans.
2
