The Management Control Systems of Growth Stage Firms and Their Impacts on the firms’ Dynamic Capabilities and Performance, According to Life-Cycle Stages

Posted: 8 Mar 2018

See all articles by Sung‐min Kim

Sung‐min Kim

Korea University

Jay Kang

San Francisco State University

Date Written: March 2, 2018

Abstract

Our questions are: [1] Do small and medium-size manufacturing enterprises adopt their management control systems (less-bureaucratic versus more-bureaucratic MCS) according to their life cycle stages (growth and maturity stages)? [2] Does the less-bureaucratic MCS in growth-stage firms favorably impact their organizational dynamic capabilities (market orientation, entrepreneurship, innovativeness, and absorptive capability) and their performances? The primary sources of data are the questionnaire responses from TMTs of 192 KOSDAQ–listed manufacturers and their financial disclosures. Our findings are: [1] KOSDAQ–listed firms on growth-stage utilize less-bureaucratic MCS, while those on maturity-stage more-bureaucratic MCS. We support Auzair & Langfield-Smith(2005) study of Australian service firms.

[2] The MCS of those firms on growth-stage exercises significantly positive impact on dynamic capabilities except entrepreneurship. In turn, all dynamic capabilities of theirs, except potential absorptive capability, impact their financial and non-financial performances positively. The MCS of growth stage firms impacts their performance indirectly. We support Henri (2006b) and Widener (2007) study of North-American large firms.

Keywords: MCS, Corporate life-cycle, Dynamic capabilities, Performances

Suggested Citation

Kim, Sung‐min and Kang, Jay, The Management Control Systems of Growth Stage Firms and Their Impacts on the firms’ Dynamic Capabilities and Performance, According to Life-Cycle Stages (March 2, 2018). XVII International Business & Economy Conference (IBEC) - San Francisco 2018, Available at SSRN: https://ssrn.com/abstract=3132943

Sung‐min Kim (Contact Author)

Korea University

No Address Available
Korea, Republic of (South Korea)

Jay Kang

San Francisco State University ( email )

1600 Holloway Avenue
San Francisco, CA 94132
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
368
PlumX Metrics