The role and use of management control systems in integrating multinational organizations in a family business setting: Exploratory case study on the role of technocratic & socio-ideological controls
Abstract: This paper answers recent calls for more research on the role and use of management control systems (MCS) in integrating multinational organizations (MNO). In contrast to the case of publicly owned firms, this topic has not yet been investigated in a family business (FB) setting. By conducting an exploratory single case study on a German manufacturing company, this paper shows how FB managers use holistic MCS based on the combination of technocratic and socio-ideological control in order to manage three tensions arising in the course of MNO integration as outlined by Busco et al. (2008): vertical vs. lateral relations; standardization vs. differentiation of practices; centralization vs. decentralization. Hereby, the importance of socio-ideological control both in terms of its self- reliance as control type and its interplay with technocratic control represents a particular point of difference between the use of MCS in FBs and non-family firms. Furthermore, we could identify a fourth tension that is unique to FBs: informal family culture vs. the need for formalization.
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