A Strategic Control Model by Emphasis on the Green Approach

Document Type: Research Article


1 Alborz Campus, University of Tehran, Karaj, Iran

2 University of Tehran, Tehran, Iran

3 University of Ilam, Ilam, Iran



The research explores a strategic control model by the emphasis on the green approach based on Simons’ levers of control framework. Special consideration is paid for assessing how much green is the organization. The purpose of this paper is to design a strategic control model for Audit institute of social security organization of Iran. The data is gathered from social security organization and Audit institute of social security organization from Jan 2018-19. The research methodology is quantitative method. Five hypotheses were raised at this study. For collecting the required data a standard questionnaire was distributed among 52 managers of the organization and the collected data was analyzed with smart-PLS software. Levers of Control of Simons’ framework provide the theoretical background for strategic control. The results demonstrate that all four levers of control are positively associated with strategic control; while the strategic control, has a positive effect on latter variable actions. For investigating green approach, the questions were considered inside of each lever of control to be measured. The results suggest that the green approach is implemented at this organization and has a positive environmental impact as a result. The results suggest that all levers of control have an approximately equal impact on strategic control, while the strategic control has a positive impact on actions. So, this means that for reaching the desired outcome, we should pay enough attention to the strategic control of our organization and its construct while it is a necessity to take actions after assessments.


Andrews, K.R. (1987). The concept of corporate strategy, the University of Michigan, Irwin.

Anthony, R. (1965). Planning and Control Systems: A Framework for Analysis. Harvard University          Graduate School of Business Administration.

Anthony, R.N. and Dearden, J. (1980). Management control systems. Homewood, IL: Irwin.

Anderson, S. W. and Dekker, H. C. (2005). Management control for market transactions: the relation between transaction characteristics, incomplete contract design, and subsequent performance. Management Science, 51, 1734–1752.

Argyris, C. (1977). Organizational learning and management information systems. Accounting, Organizations and Society, 2, 113–123.

Abernethy, M. A. and Brownell, P. (1999). The role of budgets in organizations facing strategic change: an exploratory study. Accounting, Organizations and Society, 24, 189–204.

Banker, R. D. and Datar, S. M. (1989). Sensitivity, precision, and linear aggregation of signals for performance evaluation. Journal of Accounting Research, 27, 21–39.

Barclay,D., Higgins, C. and Thompson,D. (1995). The Partial Least Squares (PLS) Approach to Causal Modeling: Personal Computer Adoption and Use as an Illustration, Technology Studies, Special Issue on Research Methodology, 2(2), 285_309.

Barrett, M.E. and Fraser, L.B., UL. (1977). Conflicting roles in budgeting for operations. Harvard Business Review, 55 (4), 137_146.

Bentler, P. M. (1990). Comparative Wt indexes in structural models. Psychological Bulletin, 107, 238–246.

Bentler, P. M. (1994). A testing method for covariance structure analysis. In T. W. Anderson, K. T. Fang & I. Olkin (Eds.), Multivariate Analysis and Its Applications. Institute of Mathematical Statistics Lecture Notes-Monograph series, 24, 123-136. doi:10.1214/lnms/1215463790

Bentler, P. M. and Dudgeon, P. (1996). Covariance structure analysis: statistical practice, theory and directions. Annual Review of Psychology, 47(1), 563-592. doi:10.1146/annurev.psych.47.1.56.

Bisbe, J. and Otley, D. (2004). The Effects of the Interactive Use of Management Control Systems on Product Innovation. Accounting, Organizations and Society, 29, 709-734.

Bruining, H., Bonnet, M. and Wright, M. (2004). Management control systems and strategy change in buyouts. Management Accounting Research, 15, 155–177.

Chenhall, R. H. and Morris, D. (1995). Organic decision and communication processes and management accounting systems in entrepreneurial and conservative business organizations. Omega, 23, 485–497.

Chendhall, R. H. (2003). Management control systems design within its organizational context: findings from contingency-based research and directions for the future, Accounting, Organizations and Society, 28(2-3), 127_168.

Chenhall, R. H. (2005). Integrative strategic performance measurement systems, strategic alignment of manufacturing, learning and strategic outcomes: an exploratory study. Accounting, Organizations and Society, 30, 395–422.

Chin, W.W. (1998). The partial least squares approach to structural equation modeling. In G. A. Morcoulides (ED). Modern methods for business research. Mahwah, New Jersey: Laurence Erlbaum Associate, 295_536.

Child, J. (1973). Strategies of control and organizational behavior. Administrative Science Quarterly, 18, 1-17.

Daft, R.L. (1983). Organization theory and design. St. Paul: West.

Daft, L. R. and Macintosh, B.H. (1984). The Nature and Use of Formal Control Systems for Management Control and Strategy Implementation, Journal of Management, 10(1), 43-66.

Danneels, E. (2002). The dynamics of product innovation and firm competences. Strategic Management Journal, 23, 1095–1121.

Dent, J. (1990). Strategy, organization and control: some possibilities for accounting research. Accounting, Organizations and Society, 15, 3–25.

Duarte, p. and Raapinso, M. (2010). A PLS model to study brand preference: An application to the mobile phone market. In V. Esposito Vinzi, W. W.

Dunbar, R.L.M. (1981). Designs for organizational control. In P.C. Nystrom & W.H. Starbuck (Eds.), Handbook of organizational design, 2, 85_115. London: Oxford University Press.

Fornell, C. and D.E Larcker (1981). Evaluation Structural Equations Models with Unobservable Variables and Measurement Error. Journal of Marketing Research, 18, 39_50.

Frezatti. F., Bido. D. de S., Cruz. A.P.C. and Machado. M.J.C. (2017). Impacts of Interactive and Diagnostic Control System Use on The Innovation Process. Brazilian Administration Review (BAR), 14(3), art.3, e160087.

Hair, J. F., Black, W. C., Babin, B. J. and Anderson, R. E. (2010). Multivariate data analysis (7th ed.). Upper Saddle River, New Jersey: Prentice Hall.

Hair, J. F., Jr., Hult, G. T. M., Ringle, C. M. and Sarstedt, M. (2014). A primer on partial least squares structural equation modeling (PLS-SEM). Thousand Oaks, CA: Sage Publications, Inc.

Hair, J.F. Ringle. Ch.M. and Sarstedt, M. (2013). Editorial - Partial Least Squares Structural Equation Modeling: Rigorous Applications, Better Results and Higher Acceptance .Long Range Planning, 46 (1-2), 1_12.

Galbraith, J. (1973). Designing complex organizations. Reading, MA: Addison-Wesley Publishing Company.

Geisser, S. (1974). A predictive approach to the random effect model. Biometricka.

Giglioni, G.B. and Bedeian, A.G. (1974). A conspectus of management control theory: 1900_1972. Academy of Management Journal, 17, 292_305.

Glueck, W. F. and Jauch, L. (1984). Business policy and strategic management (4th ed.). New York: McGraw-Hill.

Hair, J. F., Jr., Black, W. C., Babin, B. J. and Anderson, R. E. (2010). Multivariate data analysis. Upper Side River: Prentice Hall.

Hax, A. C. and Majluf, N. S. (1984). Strategic management: An integrative perspective. Englewood Cliffs, NJ: Prentice-Hall.

Henseler, J., Ringle, C. M. and Sinkovics, R. R. (2009). The use of partial least squares path modeling in international marketing. In R. R. Sinkovics & P. N. Ghauri (Eds.), New challenges to international marketing (Advances in International Marketing, 20, 277-319. Bingley, UK: Emerald Group Publishing Limited.

Henri, J. (2006). Management control systems and strategy: A resource-based perspective, Accounting, Organizations and Society, 31, 529_558.

Henri, J.-F. (2004). Performance measurement and organizational effectiveness: Bridging the gap. Managerial Finance, 30(6), 93.

Henri, J.-F. (2006). Management control systems and strategy: A resource-based perspective. Accounting, Organization & Society, 31(6), 529_558.

Hofer, Ch.W. and Schendel, D. (1978). Strategy Formulation: Analytical Concepts (The West Series in Business Policy and Planning), west group.

Hopwood, A. (1987). The archaeology of accounting systems. Accounting, Organizations and Society, 12, 207–234.

Hu, L. T. and Bentler, P. M. (1999). Cutoff criteria for fit indexes in covariance structure analysis: Conventional criteria versus new alternatives. Structural Equation Modeling: A Multidisciplinary Journal, 6(1), 1-55. doi:10.1080/10705519909540118

Ishikawa, A. and Smith, C. H. (1971). A feed forward control system for organizational planning and control, 71-53. Austin: University of Texas, Bureau of Business Research.

Ittner, C. and Larcker, D. (1997). Quality strategy, strategic control systems, and organizational performance. Accounting, Organizations and Society, 22, 293–314.

Joreskog, K. G. (1969). A general approach to confirmatory maximum likelihood factor analysis. Psychometrika, 34, 183–202.

Journeault.M., De Rongé,Y. and Henri, J.F. (2016). Levers of eco-control and competitive environmental strategy, The British Accounting Review, 48 (3), 316-340. https://doi.org/10.1016/j.bar.2016.06.001.

Kaplan, R.S. and Norton, D.P. (1992). The balanced scorecard – measures that drive performance, Harvard Business Review, 70(1).

Kasurinen, T.(2002). Exploring Management Accounting Change: The Case of Balanced Scorecard Implementation, Management Accounting Research, 13(3), 323_343. DOI: 10.1006/mare.2002.0191.

Koontz, H. and Bradspies, R. W. (1972) Managing through feed forward control. A future-directed view. Business Horizons, 25_36.

Kohler, R. (1976) Die Kontrolle strategischer Plane als Betriebswirt-schaftliches Problem (The control of strategic plans as a managerial problem). Zeitschrift fuir Betriebswirtschaft, 46, 301_318.

Kline, R. B. (2011). Principles and practice of structural equation modeling. 3rd edition. New York: The Guilford Press.

Lorange, P. and Scott Morton, M.S. (1974). A framework for management control systems. Sloan Management Review, 16(1), 41_56.

Lacobucci, D. (2010). Structural equations modeling: Fit indices, sample size, and advanced topics. Journal of Consumer Psychology, 20(1), 90-98. doi:10.1016/j.jcps.2009.09.003

LangWeld-Smith, K. (1997). Management control systems and strategy: a critical review. Accounting, Organizations and Society, 22, 207–232.

Levitt, B. andMarch, J. G. (1988). Organizational learning. Annual Review of Sociology, 14, 319–340.

Kennedy, F. and Widener, S. K. (2006). A control framework: Insights from evidence on lean accounting. Working Paper. Clemson and Rice Universities.

Kruis, A. (2008). Management control systems design and effectiveness. Breukelen: Nyenrode Business University.

Kruis, A., Speklé, R.F. and Widener, S.K. (2015). The Levers of Control Framework: an exploratory analysis of balance. Management Accounting Research. DOI: 10.1016/j.mar.2015.12.002.

Lorange,P., Scott Morton,M.S. and Ghoshal, S. (1986). Strategic control systems, West Publishing Company, College & School Division, Business & Economics.

Malmi, T. and Brown, D. (2008). Management control systems as a package—Opportunities, challenges and research directions. Management Accounting Research , 19, 287_300.

Menon.A. (2018). Bringing cognition into strategic interactions: Strategic mental models and open questions, Strategic Management Journal, vol. 39, issue 1, 168_192. https://doi.org/10.1002/smj.2700.

Merchant, K. A. and Otley, D. T. (2006). A review of the literature on control and accountability. In C. Chapman, A. Hopwood, & M. Shield (Eds.), The handbook of management accounting research. Elsevier Press.

Mintzberg, H. (1979). The structuring of organizations: A synthesis of the research. Englewood Cliffs, N.J: Prentice-Hall.

Milgrom, P. and Roberts, J. (1995). Complementarities and Wt: strategy, structure and organizational change in manufacturing. Journal of Accounting and Economics, 19, 179–208.

Mohamed. R., Shu Hui. W., Abdul Rahman. I.K. and Abdul Aziz. R. (2008). Strategic Performance Measurement System and Organisation Capabilities: Using Levers of Control Framework, International Review of Business Research Papers, 4(3), 151_166.

Mohamed. R. (2010). Strategic Performance Measurement System, Organizational Capabilities and Competitive Advantage .Asian Journal of Accounting and Governance, 1, 27-50.

Mundy, J. (2010). Creating dynamic tension through a balanced use of management control systems. Accounting, Organizations and Society, 35: 499_523.

Muralidharan, R. (2004). A framework for designing strategy content controls, International Journal of Productivity and Performance Management, 53(7), 590.

Nixon, W. and Burns, J. (2005). Management control in the 21st century. Management Accounting Research, 16, 260_268.

Nunnally, J.C. (1978), Psychometric Theory. 2nd ed. McGraw-Hill, New York.

Nyamori, R. O., Perera, M. H. B. and Lawrence, S. R. (2001). “The concept of strategic change and implications for management accounting research.” Journal of Accounting Literature, 20, 62–83.

Otley, D.T. (1994). Management Control in Contemporary Organizations: Towards a Wider Framework, Management Accounting Research, 5, 289-299.

Otley, D. T. (1978). Budget use and managerial performance. Journal of Accounting Research, 16, 122–149.

Otley, D. T. (1980). The contingency theory of management accounting: achievements and prognosis. Accounting, Organizations and Society, 5, 413–428.

Otley, D. T. (1999). Performance management: a framework for management control systems research. Management Accounting Research, 10, 363–382.

Ouchi, W.G. (1977). The relationship between organizational structure and organizational control. Administrative Science Quarterly, 22, 95-112.

Pamela Muhenje, Ch.,  Nyamwange, O. and  Robert, O. (2013).  Application of Strategic Performance Measures in Small and Medium-Sized Manufacturing Enterprises in Kenya: The Use of the Balanced Scorecard Perspectives. International Journal of Management Sciences and Business Research, 2(6).

Parsons, T. (1960). Structure and process in modern societies. New York: Free Press.

Pondeville,S., Swaen,V., and De Rongé, Y. 2013. Environmental management control systems: The role of contextual and strategic factors, Management Accounting Research,24(4),  317_332. https://doi.org/10.1016/j.mar.2013.06.007.

Ringle, C. M., Sarstedt, M. and Straub, D. W. (2012). A critical look at the use of PLS-PM in MIS Quarterly. MIS Quarterly, 36(1), 3_14. Retrieved from http://misq.org/skin/frontend/default/misq/pdf/V36I1/EdCommentsV36N1.pdf.

Simons, R. (1987).Accounting control systems and business strategy: An empirical analysis, Accounting, Organizations and Society, 12(4), 357-374. DOI: 10.1016/0361-3682(87)90024-9.

Simons, R. (1990). The role of management control systems in creating competitive advantage: new perspectives, Accounting, Organizations and Society, 15(112), 127_143.

Simons, R. (1991). Strategic orientation and top management attention to control systems. Strategic Management Journal, 12, 49_62.

Simons, R. (1994). Levers of Control: How Managers Use Innovative Control Systems to Drive Strategic Renewal, Harvard business press, Business and economics.  

Simons, R. (1995).Levers of Control: How Managers Use Innovative Control Systems to Drive Strategic Renewal. Boston: Harvard Business School Press.

Simons, R. (1995). Control in an age of empowerment. Corporate governance. Boston: Harvard Business School Press.

Simons, R. (1999). Levers of control: How Managers Use Innovative Control Systems to Drive Strategic Renewal (Vol. 5). Boston, Massachusetts: Harvard Business School Press.

Simons, R. (2000). Performance Measurement & Control Systems for Implementing Strategy. USA: Prentice Hall.

Schereyogg.G. and Steinman.H. (1987). Strategic control: A new perspective. The Academy of Management Review, 12(1), 91_103.

Schermelleh-Engel, K. and Moosbrugger, H. (2003). Evaluating the fit of structural equation models: tests of significance and descriptive goodness-of-fit measures. Methods of Psychological Research Online, 8(2), 23_74. 

Schulze , M.,   Heidenreich, S. and   Spieth, P. ( 2018). The Impact of Energy Management Control Systems on Energy Efficiency in the German Manufacturing Industry, Journal of Industrial Ecology, 22(4), 813_826. https://doi.org/10.1111/jiec.12625.

Speklé, R.F., van Elten, H.J.  and Widener, S.K. (2014). Creativity and control: a paradox. Evidence from the Levers of Control Framework. Working Paper.

Steiner, G. A. (1969). Top management planning. London: MacMillan.

Ston, M. (1974). Cross-validity choice and assessment of statistical predictions. Journal of the royal statistical society. Series B (Methodological).

Schendel, D. E. and Hofer, C. W. (1979), Strategic management, 1_22. Boston-Toronto: Little, Brown.

Sugawara, H. M. and MacCallum, R. C. (1993). Effect of estimation method on incremental fit indexes for covariance structure models. Applied Psychological Measurement, 17(4), 365_377. doi:10.1177/014662169301700405

Tannenbaum, A.S. (1962). Control and organizations. New York: McGraw-Hill.

Tekavčič, M., Peljhan, D. and  Šević, Z. (2008). Levers Of Control: Analysis of Management Control Systems  In A Slovenian Company, The Journal of Applied Business Research, 24( 4), 97-112.

Todd, J. (1977). Management control systems: A key link between strategy, structure and employee performance. Organizational Dyrmmics, 65-78.

Tessier, S., and Otley, D. (2012). A Conceptual Development of Simons' Levers of Control Framework. Management Accounting Research, 23, 171-185.

Tuomela, T.-S. (2005). The interplay of different levers of control: A case study of introducing a new performance measurement system, Management Accounting Research, 16, 293–320.

Rowe, A. J., and Carlson, J. G. H. (1974). Adaptive control systems for operating management. Logistics Spectrum, Fall, 12_16.

Ringle, C. M., Sarstedt, M., and Straub, D. W. (2012). A critical look at the use of PLS-PM in MIS Quarterly. MIS Quarterly, 36(1), 3-14. 

Wang, R., Wijen, F., Pursey P.M.A.R. Heugens. (2018). Government's green grip: Multifaceted state influence on corporate environmental actions in China. Strategic Management Journal, 39(2), 403_428.

Wheelen, T. L., and Hunger, J. P. (1983). Strategic management and business policy. Reading, MA: Addison-Wesley.

Widener, S. K., Shackell, M. B. and Demers, E. A. (2006). Insights on performance measures: an investigation of relations among performance measures, delegation, incentives, and strategy. Working paper. Rice University, University of Notre Dame, and INSEAD.

Widener, S.K. (2007). An Empirical Analysis of the Levers of Control Framework. Accounting, Organizations and Society, 32, 757-788.