Linkages between the Elements of Management Control Systems in a Non-Profit Organization

25 Pages Posted: 18 Aug 2011

See all articles by Marko Järvenpää

Marko Järvenpää

University of Jyväskylä - School of Business and Economics

Aapo Ilmari Länsiluoto

Seinäjoki Business School

Date Written: August 17, 2011

Abstract

This qualitative case study examines the emergence of MCS package. We apply the MCS package framework of [Malmi, T. and Brown, D.A. (2008) Management control systems as a package-Opportunities, challenges and research directions, Management Accounting Research, Vol. 19, Iss. 4, pp. 287-300] and investigate the linkages between different control elements of MCS package. The control elements of MCS package, particularly governance structures and cybernetic systems became often overlapping and redundant. All the control elements remained in the MCS package when they were once constructed. Even tough a large number of cybernetic controls (i.e. balanced scorecard, budgets, quality management system; EFQM) were applied, only one non-financial measure was crucial at the time. Also informal control system outperformed two official cybernetic control elements used. Different control elements of MCS package were linked to each other causing complexity and challenges to manage MCS package as a one coherent system. This might be a challenge if ownership and governance structures are unclear.

Keywords: management control systems, package, control elements, redundancy

JEL Classification: M41

Suggested Citation

Järvenpää, Marko and Länsiluoto, Aapo Ilmari, Linkages between the Elements of Management Control Systems in a Non-Profit Organization (August 17, 2011). Available at SSRN: https://ssrn.com/abstract=1911135 or http://dx.doi.org/10.2139/ssrn.1911135

Marko Järvenpää

University of Jyväskylä - School of Business and Economics ( email )

University of Jyväskylä
PO Box 35
FIN 40351, FIN-40014
Finland

Aapo Ilmari Länsiluoto (Contact Author)

Seinäjoki Business School ( email )

Seinäjoki, 60100
Finland

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