Management Control Systems Report: Analysis and Implications

This report provides an in-depth analysis of management control systems and their impact on organizational culture, specifically focusing on the role of flexibility. It examines how a flexible culture influences various aspects of management, including belief systems, interactive control, diagnostic control, and boundary systems. The report discusses how these systems contribute to organizational innovation, decision-making, and strategic direction. It highlights the importance of employee engagement and the distribution of decision-making power within a flexible organizational structure. The report also references the works of Alvesson & Sveningsson (2015) and Heinicke, Guenther, & Widener (2016) to support its arguments, and emphasizes how flexible cultures enable organizations to respond effectively to market demands and enhance employee morale. The report concludes by illustrating how management control systems facilitate feedback and continuous improvement within an organization.

Running Head: MANAGEMENT CONTROL SYSTEMS 1
Management Control Systems
Name:
Institution:

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Introduction
An organization with a flexible culture is in a position to perform other innovations, have
a wide-range of decision-making, and is in a place to change its strategic direction to develop its
businesses (Heinicke, Guenther, & Widener, 2016). Flexibility in an organization has influenced
the use of the four levers of control as below;
Belief system reflects the vision, mission, and the ethics of a commercial enterprise to
understand the goals of a firm (Alvesson, & Sveningsson, 2015). Flexibility in the climate and
culture of a firm leads to change in the values and beliefs of employees, which focuses on what
workers worship may it be innovation or risk-taking. Thus, flexibility leads to a great future
culture that motivates employees to behave differently.
Interactive control creates a significant conversation across the organization and enhances
exchange at all levels, and focuses on a single issue but not turning a blind eye to other problems.
With flexibility, management layers are reduced, making the employees self-reliant. This
distributes the power of decision making to the workers. Thus, the responsiveness of a firm is
enhanced.
Boundary systems give a clear view of what the organization is not supposed to do. It
helps reduce the time spent in researching in new opportunities that will never be pursued by the
firm. However, with a flexible organizational culture, the team contribute their expertise to the
achievement of a given goal or process of an organization. The employees are called upon to
innovate, thus meet the market demand and improve their morale by becoming more invested in
the job they perform.

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Diagnostic control focuses on the power of feedback to identify if a system is in control
or not and is steadily reviewed in formal meetings. A flexible organization structure enables
employer and employees to obtain feedback about their performance in a manner that is
constructive and helpful. Where the system is out of control, an action is put in place to resolve
it.

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References
Alvesson, M., & Sveningsson, S. (2015). Changing organizational culture: Cultural change
work in progress. Routledge.
Heinicke, A., Guenther, T. W., & Widener, S. K. (2016). An examination of the relationship
between the extent of a flexible culture and the levers of control system: The key role of
beliefs control. Management Accounting Research, 33, 25-41.