Management for Professionals

Transcription

1 Management for Professionals For further volumes:

2 ThiS is a FM Blank Page

3 Erik Jannesson Fredrik Nilsson Birger Rapp Editors Strategy, Control and Competitive Advantage Case Study Evidence

4 Editors Erik Jannesson Department of Management and Engineering Linköping University Linköping Sweden Fredrik Nilsson Department of Business Studies Uppsala University Uppsala Sweden Birger Rapp Institute for Management of Innovation and Technology, Gothenburg Ljusterö Sweden ISSN ISSN X (electronic) ISBN ISBN (ebook) DOI / Springer Heidelberg New York Dordrecht London Library of Congress Control Number: # Springer-Verlag Berlin Heidelberg 2014 This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. Exempted from this legal reservation are brief excerpts in connection with reviews or scholarly analysis or material supplied specifically for the purpose of being entered and executed on a computer system, for exclusive use by the purchaser of the work. Duplication of this publication or parts thereof is permitted only under the provisions of the Copyright Law of the Publisher s location, in its current version, and permission for use must always be obtained from Springer. Permissions for use may be obtained through RightsLink at the Copyright Clearance Center. Violations are liable to prosecution under the respective Copyright Law. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. While the advice and information in this book are believed to be true and accurate at the date of publication, neither the authors nor the editors nor the publisher can accept any legal responsibility for any errors or omissions that may be made. The publisher makes no warranty, express or implied, with respect to the material contained herein. Printed on acid-free paper Springer is part of Springer ScienceþBusiness Media (

5 Preface For quite some time, the area known as strategy and management control has been of considerable interest to researchers and practitioners. Somewhat simplified, this subject concerns how the control systems of firms should be designed and used in order to formulate and implement strategies that contribute to competitive advantage and sustained high performance. Since each firm is unique, strategies and control systems must also be unique. Firms that succeed in establishing control and formulating strategies that are internally consistent, while also appropriate to the environment in which the firm operates, are more competitive than those where this is not the case. Substantial research resources have long been devoted to identifying interrelationships in this area. Many articles, book chapters and entire books replete with valuable knowledge on the subject have been published. However, there is also an abundance of ambiguous and contradictory findings, not least because many studies explore these relationships at a single point in time. It is also common for the research design to cover only one strategic level (corporate, business or functional level). In addition, almost all studies focus on a limited part of a control system, despite the existence of several control systems which should be interrelated and thus affect each other. There is thus a great need for research with a holistic point of departure, that is, research on the relationship between strategy, control and competitive advantage over extended periods and at several strategic levels, while also taking into account the existence of several control systems in a single firm. This book reports on research with precisely this orientation. With one exception, the studies presented in the book are based on research conducted in doctoral thesis projects. Without a doubt, these studies are unique in both extent and focus, and they provide highly valuable contributions to the research area of strategy and management control. They represent a considerable effort in regard to resources and involvement over an extended period. Moreover, all the firms and organizations presented are interesting and exciting, each with a fascinating history. The reader is given an in-depth look into how changes in the environment lead to adjustments in strategies and control systems. It is also clear how difficult and challenging it is to implement these changes and why such efforts are not always successful. But perhaps most importantly, the book conveys in-depth knowledge and understanding of how strategies and control systems affect competitive advantage and performance. v

6 vi Preface This book is a consolidation of the research mentioned above, but it is not an ending. We will continue with research on strategies, control systems and competitive advantage. We are therefore interested in your feedback on the content of the book and naturally on any points that are unclear and on any omissions. Information on how to reach us can be found in the Introduction to the book. Finally, we wish to thank the authors of the respective chapters for fruitful collaboration. In addition, we are deeply grateful to Associate Professor Adri de Ridder, who prepared the financial data presented in the Appendix. We wish to thank the Jan Wallander and Tom Hedelius Foundation, as well as the Tore Browaldh foundation, for providing part of the financing for this book project. Financial support was also received from the Institute for Management of Innovation and Technology (IMIT) and the Swedish Research School of Management and Information Technology (MIT). Our thanks go to Dick Wathen and Donald MacQueen (Chap. 9) for their assistance in editing the language of the manuscript. Linköping Uppsala Ljusterö May 2013 Erik Jannesson Fredrik Nilsson Birger Rapp

7 Contents 1 Introduction to the Cases: Theories, Concepts and Models... 1 Erik Jannesson, Fredrik Nilsson, and Birger Rapp 2 Driving Strategic Change at Saab AB: The Use of New Control Practices Erik Jannesson 3 How Management Control Affects the Implementation of Strategies in a Decentralized Organization: Focus on Formal and Informal Control in the Case of Atlas Copco Klas Sundberg 4 Success Through Consistent Strategy: How Does Scania s Management Control Matter? Nils-Göran Olve 5 Changing Strategies and Control Systems at a German Insurance Company Susanna Poth 6 Strategy, Management Control and Organizational Design: Empirical Illustrations from SCA Packaging Katarzyna Cieslak 7 Linking Strategy and Inter-organizational Relationships: The Case of Volvo and Scania Zita Ambrutytė 8 The Role of IT Systems in the Strategy Process: The Case of Electrolux Fredrik Nilsson and Jan Lindvall 9 Funding, Strategies and Management Control Systems: Empirical Evidence from Two Chamber Orchestras Fredrik Nilsson and Anna-Karin Stockenstrand vii

8 viii Contents 10 Conclusions and Implications Erik Jannesson, Fredrik Nilsson, and Birger Rapp Appendix: Choices of Method Index

9 About the Authors Zita Ambrutytė is currently a management consultant in the Mergers and Acquisitions sector as well as on investment-related Lithuanian governmental projects. She is also a Visiting Lecturer in Management Control and other subjects at the International Business School of Vilnius University and with the Executive Programme of the International School of Management in Vilnius, Lithuania. Katarzyna Cieslak is Acting Assistant Professor in the Department of Business Studies at Uppsala University. Her PhD thesis was on the role of controllers in organizations and the impact of organizational context on this role. Her research concerns the interplay between management control and IT in organizations, as well as issues of corporate governance, with a focus on executive compensation. Erik Jannesson is Assistant Professor in Economic Information Systems at Linköping University. His research is focused on strategic management control, in particular the relationship between strategy and management control on and between different levels in large organizations. As a researcher and consultant, he is also interested in questions regarding management control and value creation from a sustainability perspective. Jan Lindvall is Associate Professor in the Department of Business Studies at Uppsala University, where he conducts research and teaches management control related to IT. He is especially interested in how new technology, such as Enterprise Resource Planning (ERP) systems and Business Intelligence, can influence transparency, accountability and motivation in global companies. Fredrik Nilsson was appointed Professor of Business Studies, especially accounting, at Uppsala University in Previously, he was Professor of Economic Information Systems at Linköping University and Institute of Technology. His research focuses on how information systems (e.g. management control systems, financial accounting systems and production control systems) are designed and used to formulate and implement strategies. Nils-Göran Olve is Adjunct Professor at Linköping University and Guest Professor at Uppsala University. He is also a consultant and author of numerous books on management control and controllers in particular how they and new forms of IT ix

10 x About the Authors affect strategies in organizations and how control should be used to realize strategy. His books on the Balanced Scorecard have been translated into a number of languages, including English, Spanish, Japanese and Russian. Susanna Poth has worked in the insurance industry in Europe, mainly Germany, since In 2005, she deepened her practical experience in strategy as well as management and production control by taking part in the research programme on Strategy, Control and Competitive Advantage. Birger Rapp is Research Professor at the Institute for Management of Innovation and Technology (IMIT). In 2007, while Professor Emeritus of Economic Information Systems at Linköping University, he was appointed Visiting Professor at Uppsala University and at Blekinge University College. He has previously served as Dean of the Swedish Research School of Management and Information Technology, Vice President at Large of IFORS (International Federation of Operational Research Societies) and President of EURO (the Association of European Operational Research Societies). Anna-Karin Stockenstrand is Assistant Professor in the Department of Business Studies at Uppsala University. Her research concerns accountability in organizations and the long- and short-term effects on internal processes from adaptation to external demands, particularly in connection with funding. She is currently conducting research on the effects of financial reporting standards on different parts of the management control function. Klas Sundberg is Lecturer at Dalarna University. He belongs to the research profile area of Complex Systems Microdata Analysis. At Uppsala University, he earned a licentiate degree in business administration. His research focuses on strategic management, management control and accounting, but he has also published in the field of information systems.