Document Type

Working Paper

Abstract

Current body of knowledge primarily focuses on variations in and determinants of management control systems at organizational level and, to some extent, at Strategic Business Unit (SBU) level. This study proposes that the level of analysis be extended to Responsibility Center (RC) level. Further, the extant studies focus on limited contingent variables like size, top management style, strategy, structure, etc. This paper makes a departure by extending the control system determinants at RC level to also include its own environmental variables in terms of its product market characteristics, client characteristics, and profitability of unit and project. The study is set in the software industry wherein activities are homogenous across divisions and RCs; but operate in different environments which provides ideal research site for study of intra-organizational control variations. An online survey was conducted on two of the leading Indian software firms at the levels of Project Manager and Project Lead. The survey confirmed the hypotheses that control variations at RC level can be explained through strategic determinants specific to their environments. In summary, this study explored the variations in and determinants of control systems at RC level. These variations and determinants are extendable to organizational and SBU levels also. Â

Publication Date

1-4-2011

Publisher

Indian Institute of Management Bangalore

Relation

IIMB Working Paper-330

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