Relationship Between Strategy Shaping and Management Control Systems

This research analyzed the interactions between strategy shaping and management control systems, having as parameter of analysis the system of levers of control recommended by Simons (1995). A multiple case study was carried out of two companies in the construction sector in Brazil. It was found that these companies use generic niche strategies to sell the properties they have built. One of these companies uses long-term planning while the other is guided by short-term perspectives and perceptions. Both companies employ various formal control tools. It was noted, however, that some of these tools exist for the purpose of meeting the requirements of standards and audits established by certifying bodies and are not being used as tools for decision making. It was thus concluded that the relationship between managerial controls and the shaping of strategy in these organizations occurs in a passive way, with the management control systems serving as guarantors of the accomplishment of organizational strategies and goals, but not being used effectively to identify opportunities or as a source for shaping new strategies