Matching Business-Level Strategic Controls to Strategy: Impact On Control System Effectiveness

Abstract

This study explores the contingent relationships between strategic control, business-level strategy, and the perceived effectiveness of the strategic control system. The findings suggest that: (1) firms demonstrating Cost-leader tendencies have more effective strategic control systems when their controls are tighter (i.e., greater degree of formalization, upper management supervision, and role specialization); and (2) firms demonstrating Differentiator tendencies have more effective strategic control systems when their controls are looser.