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Management Control Systems: A Review E. Strauß and C. Zecher

Appendix

Appendix A: Review protocol

Review Protocol

Review motivation

In recent years, the field of management accounting and control has experienced a new dynamic in terms of proposing various new analytical conceptualizations of MCS. However, different attempts to improve conceptualizations of MCS and to overcome existing inconsistencies have not (yet) been successful. Rather, the field of MCS research is still characterized by its fragmented status. The fact that the literature has not yet provided a review of past research on conceptualizations of MCS contributes to the fragmented view of the field.Therefore, the purpose of this paper is to illustrate and to evaluate analytical conceptualizations of MCS that have been developed in the academic literature.

Research questions

How are MCS defined in the literature and in which regards are those definitions similar/different?What constitutes a continuum of conceptualizations of MCS?Which purposes do MCS have to fulfill?Which types of MCS have been developed?Which frameworks of MCS have been developed and in which regards are those frameworks similar/different?Which textbooks are used for teaching MCS and how do these textbooks approach MCS?

Sample Our sample consists of textbooks about MCS as well as of published papers aimed at making a contribution to the conceptualization of MCS.

Search strategy

Relevant papers and textbooks are identified in a three-stage process:1. E-Mail survey among accounting academics with the use of

Hasselback’s Accounting Faculty Directory2. Syllabi search with the Internet search engine Google on websites of

universities and colleges in English-speaking countries; using the keywords “syllabus”, “management control systems” and “site:.edu”

3. Search for papers in the online database EBSCO/Business Source Complete; using the keywords “MCS”, “management control system”, “management control”, “control system”, “performance measurement system”, “management accounting and control system”, and “organizational control”

Criteria for the inclusion of textbooks

The textbook has been nominated by the survey The textbook has been recommended in a syllabus The textbook covers the individual, corporate organization, i.e. it is not

restricted to non-profit organizations, multi-national companies or management control in inter-firm relationships

The textbook has a definite and explicit focus on MCS, e.g. by having the term “management control systems” in its title, by dedicating a significant part of the text to the depiction of MCS, or by covering MCS in a comprehensive and detailed manner

The textbook provides a distinct approach or conceptualization of MCS that the textbooks’ authors have been developed, i.e. it goes beyond the sheer presentation of other researchers’ work

Appendix A: Review protocol (cont’d)

Criteria for the exclusion of textbooks

The textbook is neither mentioned in the survey nor recommended in a syllabus

The textbook covers MCS only in specific contexts, such as in non-profit organizations or cross-cultural settings

The textbook covers MCS only marginally, e.g. its actual focus is on another topic such as management accounting

The textbook provides solely a review of conceptualizations that researchers other than the authors have been developed

Criteria for the inclusion of papers

The paper has a definite and explicit focus on MCS, e.g. by containing either the term “management control” or “organizational control” in its title

The paper focuses on the individual, corporate organization, i.e. it is not restricted to non-profit organizations, multi-national companies or management control in inter-firm relationships

The paper is primarily conceptual in nature but can contain an empirical part

The paper makes an own contribution to the conceptualization of MCS, i.e. it goes beyond the sheer presentation of other researchers’ work

The paper is published in an academic journal or primarily addressed towards the scientific community

Criteria for the exclusion of papers

The paper primarily illustrated or applied an MCS framework without making a theoretical contribution

The paper focuses on specific control systems or control devices, e.g. accounting information systems

The paper covers MCS only in specific contexts, such as in non-profit organizations or cross-cultural settings

The paper is published in a practitioner-oriented journal or primarily addressed towards practitioners

The paper provides solely a review of conceptualizations that researchers other than the authors have been developed


Appendix B: Studies making a relevant contribution to the conceptualization of MCS

Author(s) Year Title Journal/source Method/focus Contribution to the conceptualization of MCS

Amigoni 1978 Planning Management Control Systems JBFA Normative

Discusses the degree of complexity and the degree of turbulence as independent variables relevant for designing MCS; describes distinctive features of MCS; connects control tools to independent variables and features of MCS.

Baiman 1982 Agency Research in Managerial Accounting: A Survey

JAL Analytical-internal logic

Links decision making with control; distinguishes between belief revision, motivation, and allocation as three different uses of MCS information.

Berry, Coad, Harris, Otley, and Stringer

2009 Emerging Themes in Management Control: A Review of Recent Literature

The BritishAccounting

ReviewReview

Build on the review by Otley et al. (1994) and cover the following emerging themes: decision making for strategic control, performance management for strategic control, control models for performance management and measurement, management control and new forms of organisation, control and risk, culture and control, and practice and theory.

Broadbent and Laughlin 2009 Performance Management Systems: A Conceptual Model MAR Normative

Develop a conceptual model of performance management systems (PMS) with an emphasis on the underlying factors that influence the nature of any PMS. Extension of Otley (1999), and Ferreira and Otley (2005, 2009).

Chenhall 2003Management Control Systems Design Within Its Organizational Context: Findings from Contingency-Based Research and Directions for the Future

AOS Review

Critically reviews findings from contingency-based studies and derives a series of propositions relating MCS to organizational context. Delianates the terms MCS, MAS, MIS, and AIS.

Cunningham 1992 Management Control and Accounting Systems under a Competitive Strategy AAAJ Empirical case Provides a definition of MCS.

Daft and Macintosh 1984 The Nature and Use of Formal Control Systems for Management Control and Strategy Implementation

JoM Empirical case

Identify six components or subsystems that comprise management control: 1) Strategic plan; 2) long-range plan; 3) annual operating budget; periodic statistical reports; 5) performance appraisal; 6) policies and procedures.

Appendix B: Studies making a relevant contribution to the conceptualization of MCS (cont’d)


Eilon 1961 Problems in Studying Management ControlInternational

Journal of Production Research

NormativeProvides a definition of MCS; proposes a cybernetic (instead of a functional) approach towards the study of MCS.

Evans III, Lewis, and Patton

1986 An Economic Modeling Approach to Contingency Theory and Management Control

AOS Analytical-internal logic

Illustrate two economic models of MCS and analyze how they are affected by contingency variables.

Ferreira and Otley 2005 The Design and Use of Performance Management Systems: An Extended Framework for Analysis MAR Normative,

empirical case

Development of the performance management and control framwork (PMC) as a research tool that combines the approaches by Simons (1995) and Otley (1999). The paper has been published first on SSRN (Ferreira & Otley, 2005).

Fisher 1998Contingency Theory, Management Control Systems and Firm Outcomes: Past Results and Future Directions

BRIA ReviewIdentifies contingent control variables, defines boundaries of MCS, reviews prior research on contingency theory and MCS.

Flamholtz 1979 Toward a Psycho-Technical Systems Paradigm of Organizational Measurement

DecisionSciences Normative

Regards measurement in an organizational context as a "psycho-technical system" since a technology is intended to influence behavior, including management decisions.

Flamholtz 1983Accounting, Budgeting and Control Systems in Their Organizational Context: Theoretical and Empirical Perspectives

AOS Normative, empirical case

Concludes that an accounting systems cannot be studied in isolation as it is embedded in the organization's MCS; thus propagates a broader approach towards the study of MCS.

Flamholtz, Das, and Tsui 1985 Toward an Integrative Framework of Organizational Control AOS Normative

Develop an integrative organizational control consisting of a core control system embedded in the context of organizational structure, organizational culture and the external environment.

Fleming 1972 The Spectrum of Management ControlSAM Advanced

Management Journal

Normative

Illustrates various describtions and theories of control along a "spectrum of management control"; Differentiates between principles of control, the control feedback process, information sciences and control, and behavioral sciences and control.



Herath 2007 A Framework for Management Control Research JMD Normative

Development of the organizational MCS is based on four components: (1) organizational structure and strategy, (2) corporate culture; (3) management information systems, and (4) core control package.

Langfield-Smith 1997Management Control Systems and Strategy: A Critical Review

AOS ReviewConcludes that the relationship between strategy and MCS is not well understood, in spite of the numerous studies conducted in this area.

Lebas and Weigenstein 1986Management Control: The Roles of Rules, Markets and Culture

JMS Normative

Differentiate between markets, rules and culture as three underlying approaches of MCS and discuss those in terms of Hofstede's work-related values characterization.

Lowe 1971On the Idea of a Management Control System: Integrating Accounting and Management Control

JMS NormativeProvides a defintion of MCS; stresses the fact that MCS have to ensure that actions are in accordance with the firm's objectives.

Machin 1979A Contingent Methodology for Management Control

JMS Empirical fieldExamines the design and usage of a MCS from a contingency perspective; puts an emphasis on informational purposes of MCS.

Malmi and Brown 2008Management Control Systems as a Package - Opportunities, Challenges and Research Directions

MAR NormativeDevelopment of the MCS package that involves cultural controls, planning, cybernetic controls, reward and compensation, and administrative controls.

Modell 1995A Three-Dimensional Approach to Management Control Systems

JBM Normative

Develops eight archetypal MCS by positioning the formal MCS along the feedback/feed-forward, the financial/non-financial and the formal/informal dimensions of control.



Morris III 1986Management Control and Decision Support Systems: An Overview

Industrial Management

Normative

Provides a definition and classification of control systems and outlines problems that occur during the design, development and implementation of decision support systems.

Murr, Bracey, and Hill 1980How to Improve Your Organization's Management Controls

Management Review

NormativeProvide a definition of MCS; identify which kinds of controls fit with which organizational characteristics

Otley 1994Management Control in Contemporary Organizations: Towards a Wider Framework

MAR Normative

Argues that the traditional approach towards MCS developed in the 1960s emphasized accounting-based controls which is are too restrictive in a contemporary setting. Instead, a holistic approach towards the study of MCS is suggested.

Otley 1999Performance Management: A Framework for Management Control Systems Research

MAR Normative

Development of the performance management frame-work consists of five questions that address (1) key objectives, (2) strategies and plans, (3) required level of performance, (4) rewards, and (5) information flows.

Otley and Berry 1980 Control, Organisation and Accounting AOS NormativeDistinguish different forms of control under different conditions and the recognize the interaction of control with the social community.

Otley, Broadbent, and Berry

1995Research in Management Control: An Overview of Its Development

BJM ReviewPoint out that the work by Anthony (1965) led to an emphasis of accounting-based frameworks and advocate a broader understanding of MCS.

Ouchi 1977The Relationship between Organizational Structure and Organizational Control

AQS Empirical fieldDifferentiates between behavior control and output control.

Ouchi 1979A Conceptual Framework for the Design of Organizational Control Mechanisms

MS NormativeDescribes market, bureaucratic, and clan as three different control mechanisms.



Simons 1987Accounting Control Systems and Business Strategy: An Empirical Analysis

AOS Empirical fieldExamines the link between strategy and MCS which will later become a key feature of Simons' 'levers of control' framework.

Simons 1990The Role of Management Control Systems in Creating Competitive Advantage: New

AOS Empirical caseExamines how MCS are used in the process of strategy formulation; introduces the notion of interactive

Simons 1991Strategic Orientation and Top Management Attention to Control Systems

SMJ Empirical caseExamines the differences between diagnostic and interactive control systems.

Simons 1994How New Top Managers Use Control Systems as Levers of Strategic Renewal

SMJ Empirical case Introduces the 'levers of control' framework.

Speklé 2001Explaining Management Control Structure Variety: A Transaction Cost Economics Perspective

AOS NormativePresents a transaction cost economics approach for the development of MCS archetypes.

Vosselman 2002Towards Horizontal Archetypes of Management Control: A Transaction Cost Economics Perspective

MAR NormativeExplains the adoption and design of horizontal MCS by following a transaction cost economics approach.

Whitley 1999Firms, Institutions and Management Control: The Comparative Analysis of Coordination and Control Systems

AOS Normative

Distinguishes between four characteristics of control systems ((1) the extent to which control is exercised overwhelmingly through formal rules and procedures, (2) the degree of control exercised over how unit activities are carried out, (3) the influence and involvement of unit members in exercising control, and (4) the scope of the information used by the control system in evaluating performance and deciding rewards and sanctions), and four types of control systems ((1) bureaucratic, (2) output, (3) delegated, and (4) patriarchal).


Appendix C: Approaches to studying management control

Most reviews on MCS research draw on different approaches towards the study of

management control to organize the various studies conducted in this area. Error:

Reference source not found provides an overview of the approaches covered by different

reviews. It should be noted that only those approaches were selected that have

particularly inspired empirical management control researchers. While many more

possible perspectives towards management control exist, these are deemed to be of minor

importance. As the table indicates, the selection of perspectives differs considerably

across the reviews. For instance, Hofstede (1978) focuses solely on the cybernetic

philosophy, while Merchant and Otley (2007) cover six1 bodies of MCS-related literature.

In total, we identified nine empirically applied approaches towards management control

which will be briefly discussed in this section.

1 In fact, Merchant and Otley (2007) discuss seven approaches since systems theory is separated into a systemic and a systematic approach. However, to our knowledge, Merchant and Otley (2007) are the only authors that make this distinction. Therefore, we decided to subsume both approaches under the category systems theory.


Approaches towards management control

Cybernetics Systems theory

Contingency theory

Agency theory

Internal control

Risk management

Radical perspective

Psychological/behavioral research

Sociological research

Bedeian and Giglioni 1974 AMJ x

Hofstede 1978 AMR x

Merchant and Simons 1986 JAL x x x x x

Parker 1986 Monograph x x x x

Otley, Broadbent, and Berry 1995 BJM x x x x

Sisaye 1998 BRA x x x

Chenhall 2003 AOS x x x x

Merchant and Otley 2007 Article in edited volume

x x x x x x

Author(s) Year Source

Approaches towards management control (own illustration)

Management Control Systems: A Review Strauß & Zecher

As the number of reviews including this approach indicates, cybernetics2 is a popular

theory in management control research. In fact, the cybernetic idea is prevalent in the earliest

discussions of management control (Bedeian and Giglioni 1974). Among others, this first

category of approaches is concerned with communication and control processes in social

systems (Merchant and Otley 2007). The cybernetic philosophy is based on the following

assumptions:

“1. There is a standard, corresponding to effective and efficient accomplishment of the organization’s objectives.

2. Actual accomplishment can be measured. […]

3. When standard and measurement are compared and variance information is fed back, this information can be used to intervene in the process so as to eliminate unwanted differences between measurement and standard for the next round.” (Hofstede 1978, pp. 451-452)

Particularly, a control process can have one or more feedback loops (Merchant and Otley

2007; Merchant and Simons 1986). In addition to the feedback function described by

Hofstede (1978), controls in cybernetic models are also recognized to have a feed forward

function, such as extrapolating figures before measures are taken (Merchant and Otley 2007;

Parker 1986). Essentially, the cybernetic approach implies that the management control

process is comparable to processes in the natural sciences, such as physics (Merchant and

Simons 1986; Parker 1986). Regarding the limitations of cybernetics, Hofstede (1978)

criticizes that the assumptions for applying this model are rarely justified in organizational

practice. Further, the cybernetic approach seems more applicable for routine processes, e.g.

for industrial production. Above all, Hofstede (1978) is of the opinion that management

control process, in which people are involved, cannot be compared to machine-like processes.

In particular, the cybernetic approach neglects issues of motivating employees and creating a

sense of shared values in the organization. Issues of negotiation, power, and judgment in

decision making are also neglected. As a suggestion, researchers should differentiate between

organizational processes that are cybernetic and those that are more political in nature

(Hofstede 1978).

2 Parker (1986) discusses the cybernetic approach under the term ‘structural control model’.


The field of systems theory is difficult to delineate from cybernetics. Merchant and

Otley (2007) propose that cybernetics are concerned with closed systems, while systems

theory assumes an open point of view (Otley et al. 1995). As Parker (1986) noted:

“Thus social organizations came to be viewed as open systems, open to external environmental influence as well as internal factors, receiving inputs and transforming them into outputs, engaged in a process of continuous adjustment to environmental changes and regulating their activities with a view to achieving a state of dynamic equilibrium […].” (p. 147)

In fact, systems theory is cybernetic in nature with some important differences to the

cybernetic philosophy. First, systems theory requires the study of entire organizations rather

than a selection of certain parts, since organizational systems consist of several, interrelated

subsystems. Second, control is perceived as a dynamic instead of a static mechanism between

people and activities (Parker 1986).

Furthermore, within systems theory, Merchant and Otley (2007) differentiate between

the systemic and the systematic approach. Whereas the systemic approach is concerned with

the whole control of the organization and its activities, the systematic approach prevails in

accounting controls (Merchant and Otley 2007).

Rooted in organizational theory, contingency theory gained popularity in the early

1960s and – applied to management control – was used to explain how the effectiveness of

MCS depends on the specification of certain contextual variables (Chenhall 2003). In other

words, contingency theory claims that ‘no size fits it all’ (Merchant and Otley 2007; Parker

1986).3 Organizations were perceived as open social systems with distinct features (Sisaye

1998). The context-specific factors encompass, for instance, environmental uncertainty,

competition, technology, organizational structure, size, strategy and culture. The vast majority

of contingency-based studies analyze survey data (Chenhall 2003; Merchant and Simons

1986; Sisaye 1998). However, it was not until the early 1980s that contingency theory became

a popular approach in MCS research (Chenhall 2003). Though many studies with a

3 In fact, different forms of fit can be assumed such as the congruence and contingency fit. For further reading, the articles by Gerdin and Greve (2004, 2008) are recommended.


contingency approach have been conducted, a common shortcoming is their lack of advice for

designing effective MCS (Merchant and Otley 2007; Merchant and Simons 1986).

Agency theory has its foundations in microeconomic theory and basically applies

these principles to issues in management control (Merchant and Otley 2007; Merchant and

Simons 1986). Relying on the basic assumptions of asymmetric information and self-

interested individuals, agency theory is concerned with the optimal design of incentive

contracts between principals and agents. Thus, an agency relationship implies that a principal

delegates a task to an agent. Consequently, organizations form the aggregates of all principal-

agent-relationships across hierarchies. By developing agency models, researchers examine

how agency costs can be minimized under different conditions to ensure that the agent acts

appropriately in the principal’s interests. Among the variables specified in such models are

the risk preferences of the two actors, the cost of monitoring the agent’s behavior, and the

degree of information asymmetry. While some empirical research based on agency theory has

been conducted, most studies are analytical in nature. A commonly cited criticism of those

studies refers to their unrealistic assumptions, in addition to their disregard of contextual

factors. Nevertheless, some valuable insights have been generated concerning the design of

reward and compensation systems (Chenhall 2003; Merchant and Otley 2007; Merchant and

Simons 1986).

The following two categories, internal control and risk management, are rather fields

of study than distinct theories. Internal control, as a term originating from auditing, focuses

on an organization’s compliance with laws and regulations. Risk management is a broad term

that also addresses issues such as insurance and hedging strategies. However, both bodies

note, this body of literature are rather practice-oriented and less prevalent in research related

to management accounting and control (Merchant and Otley 2007).

Radical perspectives encompass critical, interpretive, and anthropological

approaches.4 They are characterized by the recognition of two distinct aspects of

4 For an illustration of approaches categorized as radical perspectives, and its application, see Chua et al. (1989).


organizational activities. The first refers to the perception of the environment. While the

environment has been seen as a determinant to which the organization has to adapt, radical

theorists recognize that organizations can also influence their environment. The second

feature concerns the political dimension of organizational activities and particularly the

exercise of power. In this regard, radical theorists have revealed that MCS are embedded in a

complex political environment (Otley et al. 1995).

Regarding psychological or behavioral research in control, it “[...] is concerned with

the cognitive variability and cognitive limitations of individuals” (Merchant and Simons

1986, p. 189). Thus, behavioral research aims at explaining why individuals make decisions

inconsistent with expectations originating from rational economics. Thereby, aspects such as

selective perception and limitations in cognitive abilities are examined (Chenhall 2003). The

first study about behavioral issues of MCS was published in the early 1950s, but behavioral

management control research did not gain momentum until the 1970s (Otley et al. 1995;

Parker 1986). As a result of this body of literature, our understanding of cognitive processes

deepened and suggestions were made on how information processes and decision settings

could be improved. A major strength of behavioral approaches is their interdisciplinarity,

particularly their strong theoretical foundation in psychology (Merchant and Simons 1986).

While earlier studies focused on individual decision-making and neglected the link to

organizational performance, more recent research extended this approach to examine effects

on group as well as on organizational performance (Sisaye 1998).

The term sociological research is not used in a consistent manner. Merchant and

Simons (1986) employ the term “small sample sociological research” to describe case study

research as a contrast to large sample sociological research that draws on contingency theory.

While this distinguishes research methods rather than particular perspectives on management

control, studies in this category are characterized by a rich depiction of an organization’s

MCS and the relevant contextual variables. By conducting case studies, researchers try to

understand how and why a phenomenon emerges or how an MCS operates in a specific

organizational setting (Merchant and Simons 1986; Chenhall 2003).


In contrast, according to Sisaye (1998), sociology views organizations as “rational

purposive social systems” (p. 12) with their ultimate objective being utility maximization.

The latter is achieved when MCS are designed according to the rational choice model, when

resources are allocated and services provided in an effective manner (Sisaye 1998).

To conclude, the illustrations of these approaches towards management control have

indicated the diversity of MCS research as well as the difficulty to compare studies conducted

under different paradigms. In fact, it is even difficult to compare studies conducted under the

same paradigm due to the different understandings and interpretations of the approaches.

Thus, for analyzing research on MCS, the assumptions and the characteristics of the

underlying perspective should be kept in mind.


Appendix D: Rationales given for the selection of MCS textbooks

(a) Merchant and Van der Stede (2003)

“It is very comprehensive and has great cases.”

“Comprehensive coverage and real-world contexts.”

“Comprehensive coverage, up-to-date, well written.”

“[It] is broad and international.”

“I like it because of the depth of cases.”

“I selected the Merchant & Van der Stede book because it covered control systems more broadly than the other texts. This text also had more well-written cases. […] Also other texts really seem more cost accounting related and they seem more focused on calculating costs, etc. as the main teaching point.”

“A well-written, and well-received book on managerial control systems. This book has a behavior orientation using the framework of actions controls, results controls, and people controls. This book includes cases.”

“Merchant and Van der Stede because it is up to date, not too expensive and has reasonable set of cases.”

“No 2 [after Anthony and Govindarajan 2007], brought in the newer nuances and concepts and a bit of easier approach for the students.”

“Merchant gives an appealing framework that is both systematic and exhaustive regarding management controls. The book contains many real life cases. It can be considered the standard work on modern management control systems.”

“What I like about this book is that it has a broader definition of MCS. As the authors explain, they recognize that management controls can sometimes serve other purpose than performance measurement, such as compliance to organizational policies and laws. To me this is much more realistic, because in practice, people can't always separate controls between management controls and internal control.”

“My first choice would be the Merchant and Van der Stede […] (strong emphasis on motivation and reward systems, but incomplete, especially on operations -- good for executive teaching).”

“3. Merchant-Van der Stede. I like this book for its breadth but disagree with its approach.”

“First, in my opinion, Merchant et al is written in a modern context. Secondly, merchant's view of MCS systems - everything a manager does to ensure that stragegies and plans are carried out, correspond to my owen. (perhaps, I should say that I have been influenced by Merchant).”

“Merchant & Van der Stede provide a broad overview of controls, but do not include all accounting supporting decision making into controls like some of the scholars do (e.g. Chenhall 2003).”


“I liked because he had a view of MCS that coincided with mine.”

(b) Anthony and Govindarajan (2007)

“[I] like the large number, wide variety, and generally high quality of the cases in the Anthony & Govindarajan book.”

“While I was teaching the MCS course from the mid 70s to the mid 90s I was using Robert Anthony's text ... the co-authors kept changing over the years, and I never found any really compelling competitors in the field ... Bob Anthony and the folks at HBS really defined the discipline, wrote about it interestingly, and came up with the cases, both new and classic […].”

“It had reasonable text and good cases.”

“The first one being the earliest one to appear in the market and satisfied many of the things I was looking for. It has good cases, a pretty good mix of theory and quantitative approach.”

“Anthony is the godfather of management control. This book still is the basis of any more in-depth study of management control systems.”

“This book provides more in-depth coverage of management control systems and may be a book for master level course.”

“[It] is the ‘original’ and keeps the subject area somewhat ‘anchored’.”

“This book is an evolution of Anthony seminal work from 1965. While it is in my opinion slightly outdated, it is still very popular. What is nice about this book is its structure which makes it a good textbook for undergrad courses. My main reserve however with it is its narrow definition of MCS which hasn't evolved since the 1960s. It ignores compliance-related controls and it separates management controls from strategic and operational controls. While this distinction was useful as a starting point, it is difficult to use in practice.”

“1. It is comprehensive regarding the controllership function. 2. The flow of the controllership material is logical, easy to follow by graduate students. 3. Many of the cases in the book are excellent materials for learning. They are Harvard Business School cases. However, some of the cases in the book are too complicated and too long. 4. The book provides many relevant examples from industry to illustrate key points. 5. The case analyses the publisher provides to adopters are very good.”

“[…] it has good aspects but seems a bit outdated.”

“Anthony's book is just augmented with strategy considerations.”

“Nice context and cases.”

“I have great confidence in the experience, intelligence and wisdom of (the late) Bob Anthony [...].”

“I like the topic coverage.”

“Anthony has been around for a long time and is getting a little tired even though he has used a joint author.”


(c) Simons (2000)

“I believe that accounting typically covers operational, diagnostic controls and that students should consider the broader spectrum. I think Simons introduces that broader perspective. Accounting takes a narrow focus. Management tends to ignore control thinking that accounting is going to cover it. There is a need to look at the broad spectrum of organizational control.”

“The focus on the four ‘levers of control’ is useful to me...though students have not found it as compelling.”

“Great model. Frames the issues very well. Very good cases.”

“Modern techniques, levers of control discussion, well-written, real-world contexts.”

“The Simons text is the one I use in our Management Control Course. While it is not perfect it does have a very good coverage of the major MCS issues. It is a well organized book and really helps students understand MCS as a holistic area of study (not just something which can be understood from an accounting point of view).”

“Simons’ book is explicitly built around strategy implementation.”

“Simons combines strategy formation with strategy implementation and thus provides a contemporary view on management control systems that good one step further than Merchant by focusing on innovation.”

“I hesitated before putting this book on my list, because it has many flaws as a textbook. For example, it does not have a user friendly structure for use in a class room and it presents well-known concepts such as cost variances in a new way, which is just confusing. Also, the four levels however could do with more precise definitions, because the levers of control framework can be sometimes confusing. However, it does have interesting ideas on MCS. The interactive use of controls is one of them.”

“This is the book that corresponds most closely with my philosophy.”

“Simons Levers of Control is simple enough and easy to explain to managerial audience. It has also generated quite a lot research.”

“Relevant.”

(d) Other textbooks

“Because I rarely use textbooks, especially if management control. If the latter I will refer to Macintosh small book because it is insightful and refreshingly non-mainstream; then Emmanuel, Otley & [Merchant] particularly because the cases are good.”

“Many cases in this book [Allen et al. 2004] offer a very practical view on management control systems. I thought it is pretty good supplemental materials. This book [Horngren et al. 2008a] integrates the concept of management control systems into each chapter of the book.”

“Macintosh is strong conceptually and stimulating.”


“[Merchant and Van der Stede 2003, Hopper et al. 2007, Emmanuel et al. 1990:] Comprehensive coverage, up-to-date, well written.”

“I like [Emmanuel et al. 1990] because of the broad theoretical treatment of the area.”

“All of these textbooks [Zimmerman 2008, Atkinson et al. 2007, Maher et al. 2007] emphasize the importance of linking the firm's strategy to the decisions that are supported by the managerial accounting system from production decisions to customers to employee performance plans and programs.”

“Only this text [Horngren et al. 2008a] does a good job of covering MCS from an accounting prospective.”

“It [Horngren et al. 2008a] is comprehensive, up to date, and has excellent problems.”

“I believe it [Horngren et al. 2008a] does a good comprehensive job, covering many areas of Cost/Management Accounting.”

“I do not exactly teach a course on MCS. I do teach a management accounting course that includes as a minor component management control issues. For that course, I use a textbook by Horngren, Datar and Foster titled 'Cost accounting: a managerial emphasis', which is similar to many other books on the subject.”

“The only book I know is Ron Hilton’s, so I really can't rank.”

“2. Zimmerman. This is not a straight MCS book but has a control / incentive flavor. I use the 3-legged stool idea all the time.”

(e) General comments

“My only comments are that in recent years cost texts have begun to sound too much like management texts, rather than accounting texts. Further, problems and cases fail to capture to full complexity of real world situations.”

“This is a difficult question to answer since there are many different definitions of management control. Therefore how a book user defines management control will have a major influence on the rating.”

“Keep in mind that in the U.S. accounting academicians tend to use the term ‘managerial (or management) accounting’ to include what most accounting academicians in Europe call ‘management control’.”

“Other than the Harvard case book on Management control Systems, I can think of few others. Could it be that the topic is larger than is found in one textbook or one discipline? That is my view.”

“MCS are all or nothing.”

“You have set yourself a difficult task. Anglo-Saxon researchers have tended to use management control to indicate a broader approach to control than just management accounting. However, there has never been clear boundaries amongst them (The Management Control Workshop members in the early 1980s debating amongst themselves to find a definition of management control without ever achieving a


consensus) - though they managed to work well together after. Systems theory and cybernetics was originally an important source but later work drifted more into philosophy and sociology and saw control as power. Another problem was where to draw boundaries, e.g. between planning, strategy, operations and control - we found it difficult to justify any boundaries but we still tended to keep more to aspects of control and not develop an all embracing control theory that included say marketing, operations etc. Sorry - but you may never find a common management control definition amongst Anglo-Saxon scholars - perhaps it is a boundary object albeit a useful one. It produced lots of interesting work - do you need a definition? Is it dangerous?”

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