This study examines management control (MC) combinations that are effective in different strategic contexts through two related approaches – MC as a package and MC as a system. First, this study identifies how a set of MC practices combine (i.e. MC packages) to achieve effective control outcomes for firms operating in defender and prospector strategic contexts by applying fuzzy set qualitative comparative analysis (fsQCA). Using data from a survey of top managers the analysis reveals that there are multiple ways by which firms can effectively combine MC practices in a given strategic context. Furthermore, the analysis shows that not all MC practices found to be relevant in isolation are relevant when examined simultaneously as a package. Second, based on a comparison of effective MC packages this study examines interdependencies between MC practices (i.e. MC systems). Results show that in defender firms a diagnostic control use of accounting and mechanistic structural controls act as complements, while mechanistic structural controls and measure diversity act as substitutes. In prospector firms an interactive control use of accounting and organic structural controls are found to have complementary effects. These results indicate that the effectiveness of accounting control and structural control choices are determined not only by their fit with strategic context but also by how they fit with each other. This study also demonstrates how an understanding of MC packages can provide guidance for theory development and empirical analysis of MC systems.

This study examines the influence of cultural regions on the interdependence between delegation of authority and other management control (MC) practices. In particular, we assess whether one of the central contentions of agency theory, that incentive contracting and delegation are jointly determined, holds in different cultural regions. Drawing on prior literature, we hypothesise that the MC practices that operate as a complement to delegation vary depending on societal values and preferences, and that MC practices other than incentive contracting will complement delegation in firms in non-Anglo cultural regions. Using data collected from 584 strategic business units across three Western cultural regions (Anglo, Germanic, Nordic), our results show that the interdependence between delegation and incentive contracting is confined to Anglo firms. In the Nordic and Germanic regions, we find that strategic and action planning participation operate as a complement to delegation, while delegation is also complemented by manager selection in Nordic firms. Overall, our study demonstrates that cultural values and preferences significantly influence MC interdependence, and suggests that caution needs to be taken in making cross-cultural generalisations about the complementarity of MC practices.