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Management control matching pattern and company strategic aggressiveness: empirical test based on annual report text information

Xiangfei Zeng (School of Business, Anhui University of Technology, Maanshan, China)
Ting Zhang (School of Business, Anhui University of Technology, Maanshan, China)
Yafei Zu (School of Economics and Management, Nanjing University of Science and Technology, Nanjing, China)

Chinese Management Studies

ISSN: 1750-614X

Article publication date: 22 December 2022

47

Abstract

Purpose

This paper aims to investigate the law and logic mechanism of management control matching pattern and company strategy aggressiveness under different strategies by textual analysis, based on the empirical data of Chinese A-share listed companies during the period from 2010 to 2018. Additional analyses further investigate the moderating effect of environmental uncertainty and R&D intensity on the relationship between management control matching type and strategy aggressiveness. The conclusion can help relevant departments to develop management control theory and method system with Chinese characteristics and provide theoretical reference for the matching mode of dual control.

Design/methodology/approach

This paper uses the text analysis method. The main explanatory variables are analyzed using the computer SQL Server database software through the relevant text of the board of directors report in the company annual report. Other financial data came from the CSMAR database, excluding ST and PT and companies with missing data, and 16,902 samples were finally obtained. This paper conducted statistical analysis through Stata12.

Findings

This paper shows that the matching pattern between formal and informal control is divided into three types. They have different impacts on strategy aggressiveness. Specifically, consistent matching type II significantly positively influences the aggressiveness of offensive strategy. Consistent matching type I significantly positively influences the aggressiveness of defensive strategy. Complementary matching type I significantly positively influences the aggressiveness of analytical strategy. Additional analyses find that compared with non-high-tech companies, high-tech companies have more significant influence on the relationship between management control matching pattern and company strategic aggressiveness. And compared with other two “strategy-control” matching patterns, both environmental uncertainty and product innovation have more significant influence on the relationship between consistent matching II and offensive strategy aggressiveness.

Originality/value

To the best of the authors’ knowledge, this paper divides the formal and informal control matching patterns of management control into three categories for the first time. It examines the relationship between the formal and informal control matching of management accounting and the degree of strategy aggressiveness. The conclusion provides new empirical evidence to promote the effective implementation of development strategies for companies. It can help relevant departments to develop management control theory and method systems with Chinese characteristics and provide theoretical references for the matching mode of dual control.

Keywords

Acknowledgements

This work was supported by Natural Science Foundation of Anhui Province [Grant number 2008085MG230]; Anhui Women's Federation, Anhui Provincial Department of Education Women's theory research key project [Grant number 2022-FNYJ-008]; Humanities and Social Sciences Foundation of the Ministry of Education in China [Grant number 20YJC630245]; National Natural Science Foundation of China [Grant number 72102108].

Citation

Zeng, X., Zhang, T. and Zu, Y. (2022), "Management control matching pattern and company strategic aggressiveness: empirical test based on annual report text information", Chinese Management Studies, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/CMS-08-2021-0344

Publisher

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Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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