Obstacles for enabling control
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Journal Title
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School of Business |
Master's thesis
Authors
Date
2021
Department
Major/Subject
Mcode
Degree programme
Accounting
Language
en
Pages
91+3
Series
Abstract
The purpose of this paper is to study what makes performance measurement systems enabling and which factors affect the nature of control in these systems. This research adds to the field of management accounting as it focuses on people and their perspectives on performance measurement. This paper studies accounting as an organizational phenomenon that is embedded in a social system and focuses on finding the linkages between management accounting and the social world. The theoretical framework is constructed around the theory of enabling control. Control system qualities are evaluated according to four characteristics: Repair, internal transparency, global transparency, and flexibility. The development process is analyzed for utilization of experience, experimentation, and professionalism that describe an enabling development process. The chosen case company is a large privately-owned Finnish company that operates in the business services industry providing financial administration outsourcing, ICT software and solutions, and consulting. The company has introduced a new PMS in the organization recently. This paper studies this one control system which gives a narrow enough scope to study the nature of control. Interestingly, the PMS studied has a feature of having all employees in the organization participate in PMS development. The study is conducted as qualitative research using interviews as the main data source. The data is collected from all levels and operations in the case company. This research is a descriptive and explanatory single case study. Findings indicate that the split between enabling and coercive control is not black and white. The research also shows that the nature of control can’t only be determined based on objective qualities of a control system, nor the development it. The study highlights the effects of organizational context on the nature of control, such as the effects of leadership, organizational culture, knowledge sharing, and employee skills. Research reveals possible obstacles for enabling control to be implemented: Patriarchal and hierarchical organization culture, lack of understanding PMS development and simultaneous use of both enabling and coercive control systems are obstacles for enabling control.Description
Thesis advisor
Vaivio, JuhaniKeywords
enabling control, coercive control, formalization, performance measurement systems, PMS, PM participation