MANAGEMENT CONTROL-SYSTEMS AND STRATEGY - A CRITICAL-REVIEW

This paper reviews research that studies the relationship between mana gement control systems (MCS) and business strategy. Empirical research studies that use contingency approaches and case study applications a re examined focusing on specific aspects of MCS and their relationship with strategy. These aspects include cost control orientation, perfor mance evaluation and reward systems, the effect of resource sharing, t he role of MCS in influencing strategic change and the choice of inter active and diagnostic controls. More contemporary approaches to the re lationship between performance measurement systems and strategy are al so considered It is concluded that our knowledge of the relationship b etween MCS and strategy is limited, providing considerable scope for f urther research. A series of future research questions is presented. ( C) 1997 Elsevier Science Ltd.