Impact of Management Control Systems on Capabilities: Evidence from Vietnamese Enterprises

Abstract

This article aims to evaluate the impact of the management control system on enterprise capacity. The model includes four elements of the management control system: Monitoring, Legitimizing Decisions, Strategic Decision Making, and Focusing on the impact of the enterprise's capabilities including learning capabilities. training and business capacity along with 3 control variables: size, number of years of establishment, and business field of the enterprise. Research data was collected from 308 administrators and accountants in Vietnamese businesses, and then analyzed using regression analysis on SPSS 22 software. Research results show that the factors of Supervision and decision-making strategy, and Focus on interest, the size of the enterprise have a positive impact on the capacity of the enterprise. The size of an enterprise has an impact on the relationship between the management control system and the capacity of Vietnamese enterprises. Control in small businesses is doing better than medium and large businesses in terms of Monitoring and Focusing attention and large businesses have better control in terms of strategic decision-making than the remaining businesses, however, Supervisors' supervision will hurt the capacity development of large enterprises. The research results explain 60% of the impact of these factors on enterprise capabilities, serving as a basis for recommendations to promote the role of management control systems in Vietnamese enterprises.