The effect of service process type, business strategy and life cycle stage on bureaucratic MCS in service organizations

Sofiah Md Auzair, Kim Langfield-Smith

Research output: Contribution to journalArticle

95 Citations (Scopus)

Abstract

This study uses the survey method to investigate the influence of several contingent variables on the design of MCS in service organizations. MCS was conceptualized in terms of five dimensions: action/results controls, formal/informal controls, tight/loose controls, restricted/flexible controls, and impersonal/interpersonal controls to form a composite measure of the degree of MCS bureaucracy. The framework used in this study recognizes that the service process type, business strategy, and stage in the organizational life cycle influence the choice of MCS design within an organization. Questionnaires were administered to financial controllers of service organizations operating in Australia. Using t tests and multiple regression analysis, the results indicated that (1) mass service, mature and cost leader firms place a greater emphasis on more bureaucratic forms of MCS, compared to professional service, growth and differentiator firms, and (2) service process type, organizational life cycle stage, and business strategies have a significant influence on the design of a firm's MCS.

Original languageEnglish
Pages (from-to)399-421
Number of pages23
JournalManagement Accounting Research
Volume16
Issue number4
DOIs
Publication statusPublished - Dec 2005

Fingerprint

Business strategy
Life cycle
Service organization
Service process
Bureaucracy
Controller
Professional services
Multiple regression analysis
Questionnaire
Costs
Formal control
T-test

Keywords

  • Life cycle
  • MCS
  • Service organizations
  • Strategy

ASJC Scopus subject areas

  • Accounting
  • Information Systems and Management
  • Finance

Cite this

The effect of service process type, business strategy and life cycle stage on bureaucratic MCS in service organizations. / Md Auzair, Sofiah; Langfield-Smith, Kim.

In: Management Accounting Research, Vol. 16, No. 4, 12.2005, p. 399-421.

Research output: Contribution to journalArticle

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