Management control systems in a hybrid organization facing financial problems

University essay from Handelshögskolan i Stockholm/Institutionen för redovisning och finansiering

Abstract: This thesis aims to further increase the knowledge regarding hybrid organizations and their use of management control systems MCS). Unlike previous research, the aim is to examine a shorter time span and to add insight to the specific use of MCSs and the effect of hybridity when facing an internal financial crisis. The study is conducted by looking at one type of organization that is subject to multiple institutional logics: an elite sports organization. Based on Malmi & Brown's MCS-package (2008), a theoretical framework has been designed in order to examine the use of in-crisis control systems. Combining this framework with Pache & Santos' (2010) theories regarding organizational responses when facing competing institutional demands, the thesis finds that sports has been heavily prioritized ahead of business. This has played out by an unequal treatment of the two different organizational units where the sports unit's MCSs were almost untouched whereas the business unit had to make heavy cutbacks. The paper's conclusion, as previous research suggests, is that non-profit organizations merely see financials as a mean and are prone to put non-financial goals ahead of financials. Adding on to previous research, this has been found to be true also when examining a shorter time period.

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