Management Control System and Firm performance-Resource Based View Perspective

Nasiru Aminu Ahmad, Rapiah Mohamed


The paper demonstrates how Management control system could be used by firms among developing countries to achieve better performance. Prior literature demonstrates how firms in developing countries are surrounded by resources but could not use them to their advantage. The idea that MCS in collaboration with tangible and intangible resources could boost a firm capability as it would make the resources imitable as such gives firm sustained capability. The paper is conceptual in nature as such requires empirical examination in order to determine the extent to which MCS in collaboration with resources at the disposal of firms could trigger better performance in developing countries. The relationship would be examined in light of resource-based view theory which found to be adequate enough to explain the relationship. The paper presupposes that Good MCS practice implementation among developing firms in collaboration with abandon resources at the disposal of companies would serve as a capability that could boost firms’ performance. The framework if empirically tested would add to the existing literature that focused mainly on contingency and agency theory in addressing firm performance thereby, neglecting the impact of firms’ potentials in achieving better performance. The adoption of good elements of management controls would enhance firms’ ability in assessing both their internal and external environment in order to tap from the abandon resources which could be used to achieve better performance.

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