Timing and drivers of management control systems in joint ventures

Marcela Porporato (School of Administrative Studies, York University, Toronto, Canada)

Qualitative Research in Accounting & Management

ISSN: 1176-6093

Publication date: 2 October 2009

Abstract

Purpose

The purpose of this paper is to describe the timing of management control systems (MCS) implementations, their drivers and effect on joint venture (JV) survival.

Design/methodology/approach

This paper draws on case study data (archival data, interviews, and site visits) collected at three JVs in the automotive industry. Contingency theory is used to define Cartesian relationships.

Findings

A description of the timing and reasons for MCS implementation in JVs is provided. Initially, environment, strategy, and partner culture are considered to implement governance mechanisms and transfer prices/cost allocations for long‐term transfers of technology and corporate services. Later, structural and technological factors are considered to implement operative MCS such as budgeting, transfer prices/cost allocations of manufactured parts and performance measurement.

Research limitations/implications

All three JVs studied: belong to the automotive industry (SIC 3174); have balanced ownership (50/50); and have one partner in common (a European family‐owned business with professional management). Data are obtained mainly through site visits, five interviews, five mailed questionnaires, and public and private archival data.

Originality/value

The paper is the first to offer a descriptive model of the timing of MCS implementation in 50/50 JVs explained by the effect of contingent factors in each stage of the JV life and in JV survival.

Keywords

Citation

Porporato, M. (2009), "Timing and drivers of management control systems in joint ventures", Qualitative Research in Accounting & Management, Vol. 6 No. 4, pp. 247-274. https://doi.org/10.1108/11766090910989518

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Publisher

:

Emerald Group Publishing Limited

Copyright © 2009, Emerald Group Publishing Limited

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