Aantekeningen / Notes
-
Research in Management Control (RMC)
(EBM082A05)
Lecturers: Semester 2A year 2022/2023
- Prof. dr. E.P. Jansen
- Prof. dr.ir. P.M.G. van Veen-Dirks RC
Index
Lecture 1 – Introduction to management control .................................................................................. 2
Introduction management control ...................................................................................................... 2
Hall (2010) – Management accounting information and how it is used by managers ....................... 5
Ferreira & Otley (2009) – performance management systems .......................................................... 5
Malmi & Brown (2008) – Management control packages .................................................................. 7
Lecture 2 – Introduction to management control research.................................................................... 8
Case study: An architect ...................................................................................................................... 8
A conceptual framework of organizational control - (William Ouchi 1979) ....................................... 8
Merchant & van der Stede (2012) ....................................................................................................... 9
Malmi and Granlund about MA theory ............................................................................................. 11
Reviewing the literature .................................................................................................................... 14
Tutorial 1 – Strategy and management control .................................................................................... 15
Paper Nörreklit .................................................................................................................................. 15
Paper Choi, Hecht and Tayler ............................................................................................................ 17
Paper Van der Kolk, Van Veen-Dirks, Ter Bogt .................................................................................. 19
Tutorial 2 – Performance measurement, motivation, and management control – NO INFO .............. 24
Tutorial 3 – Control and culture ............................................................................................................ 24
Paper Jansen, E. P., Merchant, K. A. & Van der Stede, W. A. (2009),............................................... 26
Malmi, T. et al (2020), ....................................................................................................................... 29
Tutorial 4 – the management accountant / controller ......................................................................... 31
Tutorial 5 –Q & A – NO INFO ................................................................................................................. 35
Notes 2021/2022 ................................................................................................................................... 36
2021/2022 - Tutorial 2 – Performance measurement and management control ............................ 36
Paper Speklé, R. F., & Verbeeten, F. H. (2014). ............................................................................. 36
Paper Englund, H & Gerdin, J. (2015). ........................................................................................... 37
Guest Lecture - UMCG ........................................................................................................................... 38
1
,Lecture 1 – Introduction to management control
Lecturer: P. van Veen-Dirks
Literature:
- Hall, M. (2010). Accounting information and managerial work. Accounting, Organizations and
Society, 35(3), 301-315.click
- Ferreira, A., & Otley, D. (2009). The design and use of performance management systems: An
extended framework for analysis. Management Accounting Research, 20(4), 263-282. click
- Malmi, T., & Brown, D. A. (2008). Management control systems as a package—Opportunities,
challenges and research directions. Management Accounting Research, 19(4), 287-300. click
Introduction management control
Management control problems
- A new Police commissioner gives the police force one clear simple goal: cut crime
- An Oil & Gas company decides to redevelop a part of an existing oil field. A large part is
outsourced to companies that collaborate in a consortium. However, there are many delays
and budget overruns …
- A university decides to make diversity and inclusion more important. As a program director
you are confronted with the challenge to implement this in your program.
- A bank has to implement new IFRS regulation. The finance & control department is
confronted with the challenge to implement this.
Definition of management control
Broad definition management control
- (Malmi & Brown, 2008):
o Those systems, rules, practices, values and other activities management put in place
in order to direct employee behaviour [..]
- (Merchant & van der Stede, 2012):
o Management Control includes all the devices or systems managers use to ensure that
the behaviors and decisions of their employees are consistent with the organization’s
objectives and strategies.
Both definitions are about: implementing strategy
M&vdS (2012): is about objectives and strategy; that is what differ from M&B, 2008; that is why I like
the definitions of M&vdS.
Which systems are included in management control?
Which practices and systems are included in management control?
Managers
- Delicate
- Want to be in control (they use systems)
Systems
- Soft controls (on behaviour)
- BSC (balanced scorecard)
- Performance evaluation
Management control
- Broader than management accounting
- Serval categories in the course
Action control: speed bump (example) use correct action
Performance control: giving training, pressure at the top.
2
,Action controls is more about
proceduress or rules, action is the
object of control
Personnel and cultural control is about
complaining
Object of control framework it is about
Merchant & van der Stede
Cell depends on which
production: mass or individual
production.
Where would you position the following departments:
- A: A sales department High, Imperfect (cell 1)
- B: A production plant High, High (cell2)
- C: An R&D department normally cell 4 low, imperfect (cell 3)
- D: A finance & Control department Low, perfect (cell 4)
It is not always the same
Which cell which controls (Mechant & van der Stede)
Cell 1: Action & result control
Cell 2: Result control
Cell 3: Action control
Cell 4: personnel & Culture control
It is difficult to talk about result control if you can not measure the results correct on an easy way.
Framework very similar as framework of Ouchi in paper of management accounting, Ouchi talk about
clan control.
Contingent approach to management control
Characteristics of a management control system:
- The result of a good management control system is that the firm is better able to achieve its
goal
- The most appropriate system usually depends upon certain contingent variables
-
Which contingent variables should be taken into account for the design and use of the MCS?
Contingency theory variables:
- Strategy - Size
- Culture (organizational or country) - Structure
- Technology - location
3
, Introduction to the course
You will learn to understand the various ways in which management control systems can support (or
undermine) decision making and control within organisations
You will learn how the organisational and environmental context influences the effectiveness of
particular instruments, models or systems.
- … Paying attention to behavioural and ethical considerations
- And emphasizing the relation between theory and practice
- Useful when you have to develop a solution for a particular
organisation (‘evidence-based management’)
The main objective of the course is:..
To enlarge your knowledge of management control and to develop an overview of the
dominant themes, theories, and methods in management control research.
Themes:
- Management control concepts
- Theory versus practice
- Strategy and management control
- Performance measurement
- Culture and management control
- The role of the management accountant
4
-
Research in Management Control (RMC)
(EBM082A05)
Lecturers: Semester 2A year 2022/2023
- Prof. dr. E.P. Jansen
- Prof. dr.ir. P.M.G. van Veen-Dirks RC
Index
Lecture 1 – Introduction to management control .................................................................................. 2
Introduction management control ...................................................................................................... 2
Hall (2010) – Management accounting information and how it is used by managers ....................... 5
Ferreira & Otley (2009) – performance management systems .......................................................... 5
Malmi & Brown (2008) – Management control packages .................................................................. 7
Lecture 2 – Introduction to management control research.................................................................... 8
Case study: An architect ...................................................................................................................... 8
A conceptual framework of organizational control - (William Ouchi 1979) ....................................... 8
Merchant & van der Stede (2012) ....................................................................................................... 9
Malmi and Granlund about MA theory ............................................................................................. 11
Reviewing the literature .................................................................................................................... 14
Tutorial 1 – Strategy and management control .................................................................................... 15
Paper Nörreklit .................................................................................................................................. 15
Paper Choi, Hecht and Tayler ............................................................................................................ 17
Paper Van der Kolk, Van Veen-Dirks, Ter Bogt .................................................................................. 19
Tutorial 2 – Performance measurement, motivation, and management control – NO INFO .............. 24
Tutorial 3 – Control and culture ............................................................................................................ 24
Paper Jansen, E. P., Merchant, K. A. & Van der Stede, W. A. (2009),............................................... 26
Malmi, T. et al (2020), ....................................................................................................................... 29
Tutorial 4 – the management accountant / controller ......................................................................... 31
Tutorial 5 –Q & A – NO INFO ................................................................................................................. 35
Notes 2021/2022 ................................................................................................................................... 36
2021/2022 - Tutorial 2 – Performance measurement and management control ............................ 36
Paper Speklé, R. F., & Verbeeten, F. H. (2014). ............................................................................. 36
Paper Englund, H & Gerdin, J. (2015). ........................................................................................... 37
Guest Lecture - UMCG ........................................................................................................................... 38
1
,Lecture 1 – Introduction to management control
Lecturer: P. van Veen-Dirks
Literature:
- Hall, M. (2010). Accounting information and managerial work. Accounting, Organizations and
Society, 35(3), 301-315.click
- Ferreira, A., & Otley, D. (2009). The design and use of performance management systems: An
extended framework for analysis. Management Accounting Research, 20(4), 263-282. click
- Malmi, T., & Brown, D. A. (2008). Management control systems as a package—Opportunities,
challenges and research directions. Management Accounting Research, 19(4), 287-300. click
Introduction management control
Management control problems
- A new Police commissioner gives the police force one clear simple goal: cut crime
- An Oil & Gas company decides to redevelop a part of an existing oil field. A large part is
outsourced to companies that collaborate in a consortium. However, there are many delays
and budget overruns …
- A university decides to make diversity and inclusion more important. As a program director
you are confronted with the challenge to implement this in your program.
- A bank has to implement new IFRS regulation. The finance & control department is
confronted with the challenge to implement this.
Definition of management control
Broad definition management control
- (Malmi & Brown, 2008):
o Those systems, rules, practices, values and other activities management put in place
in order to direct employee behaviour [..]
- (Merchant & van der Stede, 2012):
o Management Control includes all the devices or systems managers use to ensure that
the behaviors and decisions of their employees are consistent with the organization’s
objectives and strategies.
Both definitions are about: implementing strategy
M&vdS (2012): is about objectives and strategy; that is what differ from M&B, 2008; that is why I like
the definitions of M&vdS.
Which systems are included in management control?
Which practices and systems are included in management control?
Managers
- Delicate
- Want to be in control (they use systems)
Systems
- Soft controls (on behaviour)
- BSC (balanced scorecard)
- Performance evaluation
Management control
- Broader than management accounting
- Serval categories in the course
Action control: speed bump (example) use correct action
Performance control: giving training, pressure at the top.
2
,Action controls is more about
proceduress or rules, action is the
object of control
Personnel and cultural control is about
complaining
Object of control framework it is about
Merchant & van der Stede
Cell depends on which
production: mass or individual
production.
Where would you position the following departments:
- A: A sales department High, Imperfect (cell 1)
- B: A production plant High, High (cell2)
- C: An R&D department normally cell 4 low, imperfect (cell 3)
- D: A finance & Control department Low, perfect (cell 4)
It is not always the same
Which cell which controls (Mechant & van der Stede)
Cell 1: Action & result control
Cell 2: Result control
Cell 3: Action control
Cell 4: personnel & Culture control
It is difficult to talk about result control if you can not measure the results correct on an easy way.
Framework very similar as framework of Ouchi in paper of management accounting, Ouchi talk about
clan control.
Contingent approach to management control
Characteristics of a management control system:
- The result of a good management control system is that the firm is better able to achieve its
goal
- The most appropriate system usually depends upon certain contingent variables
-
Which contingent variables should be taken into account for the design and use of the MCS?
Contingency theory variables:
- Strategy - Size
- Culture (organizational or country) - Structure
- Technology - location
3
, Introduction to the course
You will learn to understand the various ways in which management control systems can support (or
undermine) decision making and control within organisations
You will learn how the organisational and environmental context influences the effectiveness of
particular instruments, models or systems.
- … Paying attention to behavioural and ethical considerations
- And emphasizing the relation between theory and practice
- Useful when you have to develop a solution for a particular
organisation (‘evidence-based management’)
The main objective of the course is:..
To enlarge your knowledge of management control and to develop an overview of the
dominant themes, theories, and methods in management control research.
Themes:
- Management control concepts
- Theory versus practice
- Strategy and management control
- Performance measurement
- Culture and management control
- The role of the management accountant
4
