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Research

Helena Kloosterman

Managing professionals: An examination of management control systems in professional service firms

Summary

Literature on the management of professionals has focused on maximizing the work autonomy of professionals and avoiding bureaucratic forms of control as the best way of managing professionals. However, research also indicates that PSFs make use of bureaucratic control mechanisms, suggesting that there are benefits to using these types of controls.

Using survey data from 308 professionals from a broad range of professional service firms, we explore two forms of control tightness as key attributes for the design of MCSs in professional service firms: explicit control tightness is the degree or scope of the MCS and implicit control tightness reflects the level of tolerance for deviations from the control system. We first examine the impact of the heterogeneity in the distinctive characteristics of professional service firms, on the use of both implicit and explicit forms of behavior, results, personnel, and cultural control. We then examine the impact of these control choices on individual performance both directly and indirectly through improved attitudinal outcomes.

We find that contrary to popular belief, professional service firms do not reduce their use of bureaucratic control measures in response to the PSF characteristics. Furthermore, we find little evidence of a trade-off between implicit and explicit forms of control. However, we also find little evidence that the use of bureaucratic control measures has a negative impact on individual performance.

Taken together these findings suggest that the use of bureaucratic control measures in professional service firms is less problematic than once thought, and while the use of bureaucratic control measures may not lead to significant improvements in individual performance, they also do not appear to be harmful.