Interdependency of Culture, Strategy and Management Control Systems in an R&D Context

Abstract: Organisational culture, strategy and management control systems have all been subjects of much discussion and many books and papers have been written on these topics. What is less well-established is how they interact with and influence one another, the investigation of which is the purpose of this thesis. Based on previous research, the authors develop a theoretical model based on aspects of organisational culture, strategy formulations and management control systems. This model is tested within the R & D department of Sandvik Coromant AB, a part of the Sandvik AB Group. This is conducted by means of deep interviews with key managers, as well as through a survey targeted at non-managerial personnel. The authors also review internal documentation. To complement more conventional methods, they investigate how material culture and materialities influence uphold and prohibit cultural development. The findings indicate clear correlations between organisational culture, strategy and management control systems. This is also reflected and conserved in materialities and changes thereof. Due to the esteemed age of our case company, many cultural practices can be traced over a long period of time, being both the root cause of their present success, but potentially also a stumbling block for future organisational development. The findings also indicate that some strands within the culture of the case company may be at odds with one another, possibly resulting in interference with business operations. The theoretical model, which is best viewed as preliminary, could serve as point of departure for future research. It could be tested within additional organisations, resulting in a broader scope and a more generally applicable model. It could also be expanded to include market conditions and surrounding culture, regional or national, in order to add additional depth. Finally, the importance of leaders in shaping, changing and upholding organisational culture could be further explored, particularly in regards to the active use of materialities.