MCS BSNL
Content
Management control system has
become vital in telecommunication
industry
Management control is critical for the effective survival of organizations .It provides directions to
achieve ultimate objectives of the organization. This study mainly focuses to investigate the role
of enterprise systems in implementing management controls and its impact over performance.
This research has been developed as a case study and the unit of analysis is Vodafone PLC.
Vodafone PLC is a one of leading company in the telecommunication industry in UK and also it
is a listed company in the London stock exchange. Vodafone PLC is also a key player in the
Internet service provision market with high internet speeds at low cost. There is a range of
Management Control Systems[MCS] used by Vodafone PLC, such as Balance Scorecard, Justin-Time (JIT), Total Quality Management (TQM), Target Costing, and Benchmarking are being
practiced by the Vodafone PLC. In addition, they apply some MCS which are unique to the
telecommunication industry such as SAP (Enterprise Resource Planning) System, Enterprise
Risk Management (ERM) and Quality improvement terms (QIT). Author found that even though
there are series of MCS, significant weight is given to commonly used MCS like Balanced
Scorecard and TQM. On the other hand author found that the MCS lead to increased revenue,
employee productivity, employee satisfaction, and customer base. They were also found to
improve flexibility and efficiency of functions, and the quality of decision making of the Vodafone
PLC. MCS also found to be effective in reducing employee turnover, mitigating organizational
Risk, and time savings
professional essay writers.
Introduction
1.0 Research Background
In today's time of rapid technological change in telecommunication industry, through global and
domestic competition, Management control techniques are central to sustained corporate
profitability and competitiveness. Thus, management control system has become a vital in
telecommunication industry.
Management Control Systems (MCS) is process which influences the behavior of organizational
resources to implement organizational strategies. According to Anthony (2007), defined
Management Control as the process by which managers influences other members of the
organization to implement the organization's strategies. Management controls are only one of
the tools which managers use in implementing desired strategies. However strategies get
implemented through management controls, organizational structure, human resources.
This research developed as a case study. The unit of analysis is Vodafone PLC which is a one
of leading company in the telecommunication industry in UK and also it is a listed company in
the London stock exchange. Vodafone PLC is also a key player in the Internet service provision
market with high internet speeds at low cost. Vodafone is the world's largest mobile
telecommunication network company, based on revenue, and has a market value of about
£71.2 billion (November 2009). In 31 countries Vodafone PLC is being operated and further 40
countries.
The present study captured Management Control Systems in Vodafone PLC & identifies
relationship between management Control System & their Impact to Organizational
performances.
1.1 Research Problem
The research problem being addressed to identify Management Control Systems (MCS) and its
association with performance, Case Study evidence from the leading company in
telecommunication industry, with reference to the introduction to this chapter. This research is in
favours of the following issues.
1. What are management control systems in Vodafone PLC?
2. What is relationship between management control system and organization performances?
1.2 Research Objectives
Author expected to achieve the following objectives through the proposed research as
described in the above research issues.
1. To analyze and review the practice management control system telecommunication industry.
Case study based on Vodafone PLC
2. To observe that the degree of which applicability of theoretical management control
techniques in practical. That is Reconciliation management control techniques theory with
practical applicability.
3. Identify Significant of commonly used Management Control Systems over latest Management
Control Systems
4. To observe the relationship between management control system and their impact to
organization Performances.
1.3 Ethical Issues
Some ethical issues might be involved when carry out this research. These issues are related to
the characteristics of qualitative or field methodology which usually include long-term and close
personal involvement, interviewing and participant observation. It can be due to Truthfulness,
openness, confidentiality and fidelity. It can be further demonstrated as follows:
* Informed and Voluntary Consent: Researchers are expected to obtain informed consent from
participants. Participants are not coerced into participation and have access to relevant
information prior to the consent. This requires informing participants about the overall purpose
of the research and its main features, as well as of the risks and benefits of participation.
Consent may be given in written format, verbally and audio-taped, or videotaped.
* Able to exercise free power of choice without the Intervention of force, fraud, coercion
* The investigators' responsibility to the participants includes issues such as ensuring
confidentiality, avoidance of harm, reciprocity and feedback of results.
* Full disclosure on the purpose of the research
* Potential risks and benefits of participation
* Less of Confidentiality of Information Shared and Anonymity of Research
CHAPTER 2
Literature Review
Literature Review pertains about the theoretical aspect of Management Control Systems (MCS)
and past studies of management control systems based on various research articles.
There are various definitions on Management Control Systems (MCS) by various scholars.
Anthony, R.N, Govindarajan, V. Gupta, A.K. Grant, R.F Maciariello et al, Smith, Anthony &
Young, Chenhall Horngren et al, Teemu Malmi David A. Brown and few of definitions are as
follows:
CHAPTER 3
Methodology and Research Design
3.0 Research Methodology
The research methodology is the philosophy or the general principal which guide to research.
Research methodologies deferent from research method .Research method are the tools that
use to gather data such as questionnaire, interviews, focus Group, Observation, Experiences,
and Schedules etc. The research methodology can be categorized based on quantitative
research and Qualitative research.
in order to help you with your studies. This is
The research methodology is used for this study is case study research methodology. Case
studies emphasize detailed contextual analysis of a limited number of events or conditions and
their relationships.
The unit of analysis is Vodafone PLC, one of leading company in the telecommunication
industry in UK. Participants of the research unit were employees Group Internal Audit Division,
Group Financial Accounting and Reporting Division, Group Business Control & Compliance
Assurance, Enterprise Contact Management Division, Service Delivery & Enterprise Contact
Management Division, Human Resources & Revenue Operations Division and so forth.
The data gathered, based on Semi Structured questionnaire and over the phone interview as a
primary data collection methods and Author used Archival documentation as a secondary Data
collections Method. The data analysis is done based on statistical and systematic approaches.
Data presented using pie chart, tables, scatted diagram, Column charts, bar charts and so forth.
3.1 Data Collection Method
Data collection method based on primary data collection method and secondary data collection
method. Primary Data Consists of information gathered for some specific purposes, such as
direct observation, interviews while secondary data is consists of information that already exists
and collected for some purposes. Such as magazines, research articles and so forth. For
research purpose Author selected both primary & secondary Data collection methods
3.1.1 Over the Phone Interview
One of The primary data collection methods is semi-structured interviews conducted through
over the phone. The interviews were carried with Senior Internal Auditor, Unit Manager
Corporate Finance Group of Internal Audit Division Risk management Controller of Group of
Vodafone PLC. The interviews were specially designing to get clear understanding on key
aspects of Management control systems and their relationship to performances in Vodafone
The over the phone Interviews were carried out with Senior Internal Auditor, Unit Manager
Corporate Finance Group and Risk Management Controller those who having experience in the
industry and the sound theoretical background of Management control systems. In addition to
that an interview guide (Appendix:2)was developed and e mail to the participants before
conducting interviews was to provide the participants with an insight into the nature of the
subject matter that were to be dealt with during interview. All the interviews were recorded.
3.1.2 Questionnaires
Additional sources of the primary data collection a method was Questionnaires .Questionnaires
was distributed based on two ways. Through e mail and by hand To Group Internal Audit
Division, Group Financial Accounting and Reporting Division, Group Finance & Revenue
Operations Division. During August 2010 & September 2010.
Two type of questionnaires were developed .Namely Questionnaire A and Questionnaire B
(Appendix 1),Questionnaire A was distributed among Enterprise Contact Management Division,
focusing to identified management control systems practice by Vodafone PLC Questionnaire B
was distributed other Divisions.
The Questionnaires were email to approximately 38 Participants with and exactly 22 replies
were returned.5 Questionnaires were handed over and 5 replies were returned. Successful Rate
of respond approximately around 80% achieved.
3.1.3 Documentation Reviews
Other data collection method was Archival documentation. It's a part of secondary data
collection method .Archival data was obtained mainly referring quarterly Reports, annual reports
of last 7 years. Other documentation included organizational charts, training manuals, policy
and procedure documents, Press Releases, Dow John Analysis, and Web Site of Vodafone PLC
and Initial Public Offers.
CHAPTER 4
Data Analysis & Discussion
4.0 Introduction
This section demonstrates different Management Control systems practices by Vodafone PLC
based on the data gathered by the over the phone interviews and self-completing unstructured
questionnaires which already discussed under Chapter 3 and Relationship between
management control system and their impact over organization Performances explained under
different basis.
4.1 Management Control systems practices by Vodafone PLC
Based on over the phone interview held with different Managers, there are approximately eighty
Management control systems (MCS) of Vodafone PLC. In Vodafone PLC perspective
Management control systems (MCS) are the back born of the company. it gives competitive
advantages over other organizations. Unique management control systems practices by
Vodafone PLC are SAP Enterprise Resource Planning (ERP) System, COSO model, Enterprise
Risk Management (ERM), SMART, Quality improvement terms (QIT), Customer Service Quality
Standard (CSQS), code of business ethics (CBE) and a nondisclosure agreement (NDA) as well
as they comply with traditional management controls systems (MCS) like Balanced Scorecard,
extensive planning process, Benchmarking, Quality circles, Total Quality Management (TQM)
us by a student in order to help you with your studies. This is not an example of the work
4.2 Relationship between management control system and their impact to organization
Performances.
Practices of MCS affect organizational different section's performances. According to the over
the phone interviews and gathered data from questionnaires, in a nut shell we can MCS affect
to increase the revenue of the Vodafone PLC, increase Employee Productivity and employees
retention, Reduce employee Turnover, increase Employee Satisfaction, increase Customers
Base as well as Customer Satisfaction, mitigate organizational Risk, Time savings, Improve the
flexibility and efficiency of the functions, Improve the Quality of decision making and so forth.
Those facts are deeply discussed under these sections.
4.2.1 Customer Base
Vodafone PLC uses different Management Control systems (MCS) in serving its customers.
Few are Vodafone Enterprise Contact Management (BPO) Business Process Outsourcing
(BPO) as well as The Enterprise Solutions (ES) Unit. Based on the documentation review, The
Company also commands approximately 60% of the revenue share in the country's mobile
category, despite the aggressive competition in the market.
As far as customer base of Vodafone PLC is considered it has increased during last seven
years with aggressive competitions .The customer base has increased at decreased growth
rate. Most likely as a result of reduced consumer spending power, heightened cost of living and
competing pressures on the consumer wallet. Inelastic consumption and mitigation of revenue
growth is demonstrated through the micro-measures.
During last 7 years Vodafone PLC customer base expanded by over 5 billion. Figure:4.2.1. This
was primarily due to affordable pricing, strong distribution, radio network coverage achieved
through aggressive investments on network infrastructure and backup by strengthen
management control systems.
Year
Table 4.2.1 Customer Base & Customer Growth Rate of GSM/3G
Figure: 5.2. 1 Customer Base of Vodafone PLC
4.2.2 Revenue
The organization revenue is the main indicator of practices of sound internal management
control system. Figure: 4.2.2 and table 4.2.2 Organization revenue has increase during last 5
years at a decreasing rate. In addition to that forecasted revenue for 2011 [Table 4.2.3] also
presented with competitors.
The company was able to continue its growth momentum in all dimensions of business ranging
from market and financial performance to Network expansion and product innovation even with
the tumultuous global economy with the financial crisis in the United States .
Years
Table: 4.2.2 Revenue
Figure: 4.4.2: Revenue Growth
Time Period
Vodafone
Table 4.2.2.1: Estimated retail revenues generated (m)
4.2.3 Operational Cost
Theoretically, Sound management control systems (MCS) leads to reduction of the cost of
organizations. During Last 7 years organizational operational cost has increased. It mainly due
to some other factors. Figure 4.2.3
The company's operational cost has increased due to harsh external environments with respect
to borrowing costs and foreign exchange exposure; challenges arising from the domestic
economy were exacerbated by downstream impacts of the global financial crisis putting
pressure on foreign capital inflows.
Years
Table 4.2.3: Operational Cost
Figure 4.2.3 Operational Cost
4.2.4 Human Resources
The sound human resources management control systems of the organization can be
measured in terms of employee productivity, employee retention, staff growth and staff strength.
Vodafone is by far the mobile sector's largest employer accounting for over 70% of mobile
sector employment. Over the past decade direct employees of the company in supporting the
nation's largest telecommunications network.
The Group's dynamic and youthful workforce is the key to its continued success in adapting to
the rapidly changing technology and competitive environments. Vodafone continues to
contribute to the country's employment market.
When analyzing last 6 years the staff strengthen and staff retention in a high level, this is mainly
due to robust management control systems practice by Vodafone PLC -Figure 4.2.4 &4.2.4,such
as Few of the human resources management control systems (MCS) apply for employee are
code of business ethics (CBE) and nondisclosure agreement (NDA), Employee Share Option
Scheme (ESO), Human Resource Information System (HRIS) and The Employee Performances
Review Process (PRR).
Description
Table 4.2.4 Staff Retention, Staff strength, Staff Growth, Staff Productivity
Figure 4.2.4 Staff Retention & Staff Growth
The data is analyzed base on facts proving by the discussions had Unit Manager Corporate
Finance, Senior Internal Auditor of Group Internal Audit Division and data gathered from
questionnaires and documentation reviews, They stated that organization has various
management control systems. They committed that most of the management control systems
are aggregately affect the organizational performances. But some management control systems
are there to control various activities which do not have direct impact over organizational
performances.
This essay is an example of a student's work
Disclaimer
This essay has been submitted to us by a student in order to help you with your studies. This is
not an example of the work written by our professional essay writers.
CHAPTER 5
Summary
5.0 Summary & Conclusion
The purpose of this study was to investigate the practice of management control system
Telecommunication industry. Management control of the organization is the main key
determinate factor of organizational success. But there are no research carries out to
investigate to practice of management control systems in UK telecommunications industry. The
above back ground motivated to author to carry out this research.
To meet the Research objectives of the study, the author selected Vodafone PLC as a case
study of this research. Chapter 3 focused on the method that used to perform the case study.
Participants of the research unit were staff of the various key divisions of Vodafone PLC. Data
were gathered, based on interviews conducted over the phone and questionnaire as a primary
data collection method and used Archival documentation as a secondary Data collection
Method.
After collecting all the data ,Methodological triangulation was carried out The data analysis is
done based on systematically and statistical approaches and data presented using pie chart,
tables, scatted diagram, line chart, Column charts, bar charts and so forth.
Chapter Five includes the data analysis and discussion in line with the methodology discussed
in Chapter there and in the light of past empirical research discussed under chapter two. Data
analysis and discussion is key part of a case study research as it provides the ground for the
conclusions. In this research it provides ground to assess whether the foresaid objectives
achieved or not.
Chapter four demonstrated different Management Control systems practiced by Vodafone PLC.
It explained comply with traditional management controls systems (MCS) like Balanced
Scorecard, Quality circles and Total Quality management (TQM. In addition to that chapter four
explained relationship between management control systems and its contribution towards
customer base. , Revenue Operational Cost and so forth
5.1 Concluding Remarks
Conclusion of this research will be derived from the data analysis and discussion in the Chapter
four . Conclusion will be carried out in line with the research objectives identified in the Chapter
One.
Conclusions over first and second objectives will be discussed together. The two of objectives
were to identify and review the practice management control system in Vodafone PLC and
observe that the degree of which applicability of theoretical management control techniques in
practical. Some of management control systems (MCS) unique to each organization within the
industry. There are approximately eighty Management control systems (MCS) of Dilog Vodafone
PLC.In Vodafone perspective Management control systems (MCS) are the back born of the
company .it gives competitive advantages over other organizations. There are approximately
eighty Management control systems (MCS) of Vodafone PLC Unique management control
systems practices by dialog Vodafone PLC. are SAP Enterprise Resource Planning (ERP)
System , COSO model, Enterprise Risk as well as they comply with traditional management
controls systems (MCS) like Balanced Scorecard, extensive planning process, Benchmarking,
Quality circles, Total Quality Management (TQM),Corporate Governance ,Comply with
international standards and so forth. All those management control systems are practicing
together. We cannot segregate any divisions which use only traditional management control
systems as well unique management control .
According to the data gathered, Author remarked the combination of traditional management
Common used management control Systems and Unique Management control Systems
practices Vodafone PLC.As follows Table 5.1
Division
Table: 5.1 Usages of Common MCS and Unique MCS
The final objective is to observe the relationship between management control system and their
impact to organization Performances. Concluding final objective, There are lot management
controls are in place in Vodafone PLC and they are inter related each other and where we are
unable to isolate each management control system and distinguish their performance
accordingly.
According to data gathered, They committed that most of the management control systems are
aggregately affect the organizational performances. Where as some management control
systems affected the organizational performances over other management control systems .As
an example Balance Scorecard, Quality circles and SAP Enterprise Recourses and so on.
consistent with the data gathered from Semi structured interviews conducted by over the phone
and Documentation reviews, backed up by data gathered from distributing Questionnaires
.Author can conclude the relationship between of management Control Systems and impact
over organizational performances .As follows Figure 5.2 and Table 5.2.based on the knowledge
gathered from this case study.
This essay is an example of a student's work
Disclaimer
This essay has been submitted to us by a student in order to help you with your studies. This is
not an example of the work written by our professional essay writers.
Management Control systems
Table 5.2: Relationship between MCS and Organizational Performance
5.2 Future Research Directions
This study opens a number of opportunities for future research. Firstly methodological
improvement may be made in a similar setting by increasing the length of study and the unit of
analysis to investigate the management control techniques in telecommunication industry. Data
could be collected at lower levels and more widely across the organization. to better understand
the achievement of balanced objectives it would be interesting to also obtain the views and
perceptions of a variety of customers regarding the effectiveness of Managements Control
Systems (MCS) practices by the organizations.
A second approach to extending this study is to investigate the use of the Management Control
Systems in specific strategic decisions .That is relationship of MCS and strategy decision
makings in telecommunication industry.
Thirdly research can be conducted to whether management control can minimize the disruption
caused by strategic change over time.
Finally research could also conduct to Exploration of the nature and extent to which the role and
composition of MCS changes a company matures.
5.3 Action Plan
Activity
by
01 Sep 2010
01 Sep 2010
07 Sep 2010
07 Sep 2010
30 0ct 2010
5.4 Gantt chart
Action
6.0 References
1. Antelope Consulting (1998), Case Study of the Impact of the Changing International
Telecommunications Environment on Sri Lanka, A study by Antelope Consulting for the ITU and
the Commonwealth Telecommunications Organization.
2. Anthony, R.N. (1965) Management Planning and Control Systems: A Framework for Analysis,
Harvard Business School Press, Boston, MA.
3. Christpher D.Ittner,David F.Larcker (1996),Quality Strategy, Strategic Control systems and
organizational performances, The Wharton School,university Of Pennsylvania.Philadelphia,PA
19104-6365
4. David Brown, (1996), Multiple Objectives, Management Control Systems, and the Balanced
Scorecard: An Exploratory Case Study, University of Technology Sydney, University of
Technology Sydney, Markus Granlund, University of Technology Sydney
5. Gunawardene, P. (1999a), Interconnection: The Sri Lankan Experience, Journal of the Asia
Pacific Telecommunity, 2 (1), 16-19.
6. Govindarajan, V. & Gupta, A.K. (1985) Linking Control Systems to Business Unit Strategy:
Impact on Performance, Accounting, Organizations and Society, vol. 10,
7. Grant, R.F. (2003) Strategic planning in a turbulent environment: evidence from the oil
majors, Strategic Management Journal, vol 24, pp 491517.
8. Gray, B (1990) The enactment of management control systems: a critique of
Simons,Accounting, Organizations and Society, vol. 15, Nos 1/2, pp 145-148.
9. Gupta, A. K. & Govindarajan, V. (1984) Business Unit Strategy, Managerial Characteristics,
and Business Unit Effectiveness at Strategy Implementation, Academy of Management Journal,
Vol. 27., No.1, pp. 25-41
10. Langfield-Smith, K. (2005) What do we know about Management Control Systems
andStrategy In C.S. Chapman (ed) Controlling Strategy: Management, Accounting,
andPerformance Measurement, Oxford University Press, Oxford.
11. Samarajiva, R (2000b), The Role of Competition in Institutional Reform of
Telecommunications,
12. Simons, R. (2000) Performance Measurement and Control Systems for Implementing
Strategy, Prentice-Hall, Upper Saddle River. NJ.
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become vital in telecommunication
industry
Management control is critical for the effective survival of organizations .It provides directions to
achieve ultimate objectives of the organization. This study mainly focuses to investigate the role
of enterprise systems in implementing management controls and its impact over performance.
This research has been developed as a case study and the unit of analysis is Vodafone PLC.
Vodafone PLC is a one of leading company in the telecommunication industry in UK and also it
is a listed company in the London stock exchange. Vodafone PLC is also a key player in the
Internet service provision market with high internet speeds at low cost. There is a range of
Management Control Systems[MCS] used by Vodafone PLC, such as Balance Scorecard, Justin-Time (JIT), Total Quality Management (TQM), Target Costing, and Benchmarking are being
practiced by the Vodafone PLC. In addition, they apply some MCS which are unique to the
telecommunication industry such as SAP (Enterprise Resource Planning) System, Enterprise
Risk Management (ERM) and Quality improvement terms (QIT). Author found that even though
there are series of MCS, significant weight is given to commonly used MCS like Balanced
Scorecard and TQM. On the other hand author found that the MCS lead to increased revenue,
employee productivity, employee satisfaction, and customer base. They were also found to
improve flexibility and efficiency of functions, and the quality of decision making of the Vodafone
PLC. MCS also found to be effective in reducing employee turnover, mitigating organizational
Risk, and time savings
professional essay writers.
Introduction
1.0 Research Background
In today's time of rapid technological change in telecommunication industry, through global and
domestic competition, Management control techniques are central to sustained corporate
profitability and competitiveness. Thus, management control system has become a vital in
telecommunication industry.
Management Control Systems (MCS) is process which influences the behavior of organizational
resources to implement organizational strategies. According to Anthony (2007), defined
Management Control as the process by which managers influences other members of the
organization to implement the organization's strategies. Management controls are only one of
the tools which managers use in implementing desired strategies. However strategies get
implemented through management controls, organizational structure, human resources.
This research developed as a case study. The unit of analysis is Vodafone PLC which is a one
of leading company in the telecommunication industry in UK and also it is a listed company in
the London stock exchange. Vodafone PLC is also a key player in the Internet service provision
market with high internet speeds at low cost. Vodafone is the world's largest mobile
telecommunication network company, based on revenue, and has a market value of about
£71.2 billion (November 2009). In 31 countries Vodafone PLC is being operated and further 40
countries.
The present study captured Management Control Systems in Vodafone PLC & identifies
relationship between management Control System & their Impact to Organizational
performances.
1.1 Research Problem
The research problem being addressed to identify Management Control Systems (MCS) and its
association with performance, Case Study evidence from the leading company in
telecommunication industry, with reference to the introduction to this chapter. This research is in
favours of the following issues.
1. What are management control systems in Vodafone PLC?
2. What is relationship between management control system and organization performances?
1.2 Research Objectives
Author expected to achieve the following objectives through the proposed research as
described in the above research issues.
1. To analyze and review the practice management control system telecommunication industry.
Case study based on Vodafone PLC
2. To observe that the degree of which applicability of theoretical management control
techniques in practical. That is Reconciliation management control techniques theory with
practical applicability.
3. Identify Significant of commonly used Management Control Systems over latest Management
Control Systems
4. To observe the relationship between management control system and their impact to
organization Performances.
1.3 Ethical Issues
Some ethical issues might be involved when carry out this research. These issues are related to
the characteristics of qualitative or field methodology which usually include long-term and close
personal involvement, interviewing and participant observation. It can be due to Truthfulness,
openness, confidentiality and fidelity. It can be further demonstrated as follows:
* Informed and Voluntary Consent: Researchers are expected to obtain informed consent from
participants. Participants are not coerced into participation and have access to relevant
information prior to the consent. This requires informing participants about the overall purpose
of the research and its main features, as well as of the risks and benefits of participation.
Consent may be given in written format, verbally and audio-taped, or videotaped.
* Able to exercise free power of choice without the Intervention of force, fraud, coercion
* The investigators' responsibility to the participants includes issues such as ensuring
confidentiality, avoidance of harm, reciprocity and feedback of results.
* Full disclosure on the purpose of the research
* Potential risks and benefits of participation
* Less of Confidentiality of Information Shared and Anonymity of Research
CHAPTER 2
Literature Review
Literature Review pertains about the theoretical aspect of Management Control Systems (MCS)
and past studies of management control systems based on various research articles.
There are various definitions on Management Control Systems (MCS) by various scholars.
Anthony, R.N, Govindarajan, V. Gupta, A.K. Grant, R.F Maciariello et al, Smith, Anthony &
Young, Chenhall Horngren et al, Teemu Malmi David A. Brown and few of definitions are as
follows:
CHAPTER 3
Methodology and Research Design
3.0 Research Methodology
The research methodology is the philosophy or the general principal which guide to research.
Research methodologies deferent from research method .Research method are the tools that
use to gather data such as questionnaire, interviews, focus Group, Observation, Experiences,
and Schedules etc. The research methodology can be categorized based on quantitative
research and Qualitative research.
in order to help you with your studies. This is
The research methodology is used for this study is case study research methodology. Case
studies emphasize detailed contextual analysis of a limited number of events or conditions and
their relationships.
The unit of analysis is Vodafone PLC, one of leading company in the telecommunication
industry in UK. Participants of the research unit were employees Group Internal Audit Division,
Group Financial Accounting and Reporting Division, Group Business Control & Compliance
Assurance, Enterprise Contact Management Division, Service Delivery & Enterprise Contact
Management Division, Human Resources & Revenue Operations Division and so forth.
The data gathered, based on Semi Structured questionnaire and over the phone interview as a
primary data collection methods and Author used Archival documentation as a secondary Data
collections Method. The data analysis is done based on statistical and systematic approaches.
Data presented using pie chart, tables, scatted diagram, Column charts, bar charts and so forth.
3.1 Data Collection Method
Data collection method based on primary data collection method and secondary data collection
method. Primary Data Consists of information gathered for some specific purposes, such as
direct observation, interviews while secondary data is consists of information that already exists
and collected for some purposes. Such as magazines, research articles and so forth. For
research purpose Author selected both primary & secondary Data collection methods
3.1.1 Over the Phone Interview
One of The primary data collection methods is semi-structured interviews conducted through
over the phone. The interviews were carried with Senior Internal Auditor, Unit Manager
Corporate Finance Group of Internal Audit Division Risk management Controller of Group of
Vodafone PLC. The interviews were specially designing to get clear understanding on key
aspects of Management control systems and their relationship to performances in Vodafone
The over the phone Interviews were carried out with Senior Internal Auditor, Unit Manager
Corporate Finance Group and Risk Management Controller those who having experience in the
industry and the sound theoretical background of Management control systems. In addition to
that an interview guide (Appendix:2)was developed and e mail to the participants before
conducting interviews was to provide the participants with an insight into the nature of the
subject matter that were to be dealt with during interview. All the interviews were recorded.
3.1.2 Questionnaires
Additional sources of the primary data collection a method was Questionnaires .Questionnaires
was distributed based on two ways. Through e mail and by hand To Group Internal Audit
Division, Group Financial Accounting and Reporting Division, Group Finance & Revenue
Operations Division. During August 2010 & September 2010.
Two type of questionnaires were developed .Namely Questionnaire A and Questionnaire B
(Appendix 1),Questionnaire A was distributed among Enterprise Contact Management Division,
focusing to identified management control systems practice by Vodafone PLC Questionnaire B
was distributed other Divisions.
The Questionnaires were email to approximately 38 Participants with and exactly 22 replies
were returned.5 Questionnaires were handed over and 5 replies were returned. Successful Rate
of respond approximately around 80% achieved.
3.1.3 Documentation Reviews
Other data collection method was Archival documentation. It's a part of secondary data
collection method .Archival data was obtained mainly referring quarterly Reports, annual reports
of last 7 years. Other documentation included organizational charts, training manuals, policy
and procedure documents, Press Releases, Dow John Analysis, and Web Site of Vodafone PLC
and Initial Public Offers.
CHAPTER 4
Data Analysis & Discussion
4.0 Introduction
This section demonstrates different Management Control systems practices by Vodafone PLC
based on the data gathered by the over the phone interviews and self-completing unstructured
questionnaires which already discussed under Chapter 3 and Relationship between
management control system and their impact over organization Performances explained under
different basis.
4.1 Management Control systems practices by Vodafone PLC
Based on over the phone interview held with different Managers, there are approximately eighty
Management control systems (MCS) of Vodafone PLC. In Vodafone PLC perspective
Management control systems (MCS) are the back born of the company. it gives competitive
advantages over other organizations. Unique management control systems practices by
Vodafone PLC are SAP Enterprise Resource Planning (ERP) System, COSO model, Enterprise
Risk Management (ERM), SMART, Quality improvement terms (QIT), Customer Service Quality
Standard (CSQS), code of business ethics (CBE) and a nondisclosure agreement (NDA) as well
as they comply with traditional management controls systems (MCS) like Balanced Scorecard,
extensive planning process, Benchmarking, Quality circles, Total Quality Management (TQM)
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4.2 Relationship between management control system and their impact to organization
Performances.
Practices of MCS affect organizational different section's performances. According to the over
the phone interviews and gathered data from questionnaires, in a nut shell we can MCS affect
to increase the revenue of the Vodafone PLC, increase Employee Productivity and employees
retention, Reduce employee Turnover, increase Employee Satisfaction, increase Customers
Base as well as Customer Satisfaction, mitigate organizational Risk, Time savings, Improve the
flexibility and efficiency of the functions, Improve the Quality of decision making and so forth.
Those facts are deeply discussed under these sections.
4.2.1 Customer Base
Vodafone PLC uses different Management Control systems (MCS) in serving its customers.
Few are Vodafone Enterprise Contact Management (BPO) Business Process Outsourcing
(BPO) as well as The Enterprise Solutions (ES) Unit. Based on the documentation review, The
Company also commands approximately 60% of the revenue share in the country's mobile
category, despite the aggressive competition in the market.
As far as customer base of Vodafone PLC is considered it has increased during last seven
years with aggressive competitions .The customer base has increased at decreased growth
rate. Most likely as a result of reduced consumer spending power, heightened cost of living and
competing pressures on the consumer wallet. Inelastic consumption and mitigation of revenue
growth is demonstrated through the micro-measures.
During last 7 years Vodafone PLC customer base expanded by over 5 billion. Figure:4.2.1. This
was primarily due to affordable pricing, strong distribution, radio network coverage achieved
through aggressive investments on network infrastructure and backup by strengthen
management control systems.
Year
Table 4.2.1 Customer Base & Customer Growth Rate of GSM/3G
Figure: 5.2. 1 Customer Base of Vodafone PLC
4.2.2 Revenue
The organization revenue is the main indicator of practices of sound internal management
control system. Figure: 4.2.2 and table 4.2.2 Organization revenue has increase during last 5
years at a decreasing rate. In addition to that forecasted revenue for 2011 [Table 4.2.3] also
presented with competitors.
The company was able to continue its growth momentum in all dimensions of business ranging
from market and financial performance to Network expansion and product innovation even with
the tumultuous global economy with the financial crisis in the United States .
Years
Table: 4.2.2 Revenue
Figure: 4.4.2: Revenue Growth
Time Period
Vodafone
Table 4.2.2.1: Estimated retail revenues generated (m)
4.2.3 Operational Cost
Theoretically, Sound management control systems (MCS) leads to reduction of the cost of
organizations. During Last 7 years organizational operational cost has increased. It mainly due
to some other factors. Figure 4.2.3
The company's operational cost has increased due to harsh external environments with respect
to borrowing costs and foreign exchange exposure; challenges arising from the domestic
economy were exacerbated by downstream impacts of the global financial crisis putting
pressure on foreign capital inflows.
Years
Table 4.2.3: Operational Cost
Figure 4.2.3 Operational Cost
4.2.4 Human Resources
The sound human resources management control systems of the organization can be
measured in terms of employee productivity, employee retention, staff growth and staff strength.
Vodafone is by far the mobile sector's largest employer accounting for over 70% of mobile
sector employment. Over the past decade direct employees of the company in supporting the
nation's largest telecommunications network.
The Group's dynamic and youthful workforce is the key to its continued success in adapting to
the rapidly changing technology and competitive environments. Vodafone continues to
contribute to the country's employment market.
When analyzing last 6 years the staff strengthen and staff retention in a high level, this is mainly
due to robust management control systems practice by Vodafone PLC -Figure 4.2.4 &4.2.4,such
as Few of the human resources management control systems (MCS) apply for employee are
code of business ethics (CBE) and nondisclosure agreement (NDA), Employee Share Option
Scheme (ESO), Human Resource Information System (HRIS) and The Employee Performances
Review Process (PRR).
Description
Table 4.2.4 Staff Retention, Staff strength, Staff Growth, Staff Productivity
Figure 4.2.4 Staff Retention & Staff Growth
The data is analyzed base on facts proving by the discussions had Unit Manager Corporate
Finance, Senior Internal Auditor of Group Internal Audit Division and data gathered from
questionnaires and documentation reviews, They stated that organization has various
management control systems. They committed that most of the management control systems
are aggregately affect the organizational performances. But some management control systems
are there to control various activities which do not have direct impact over organizational
performances.
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CHAPTER 5
Summary
5.0 Summary & Conclusion
The purpose of this study was to investigate the practice of management control system
Telecommunication industry. Management control of the organization is the main key
determinate factor of organizational success. But there are no research carries out to
investigate to practice of management control systems in UK telecommunications industry. The
above back ground motivated to author to carry out this research.
To meet the Research objectives of the study, the author selected Vodafone PLC as a case
study of this research. Chapter 3 focused on the method that used to perform the case study.
Participants of the research unit were staff of the various key divisions of Vodafone PLC. Data
were gathered, based on interviews conducted over the phone and questionnaire as a primary
data collection method and used Archival documentation as a secondary Data collection
Method.
After collecting all the data ,Methodological triangulation was carried out The data analysis is
done based on systematically and statistical approaches and data presented using pie chart,
tables, scatted diagram, line chart, Column charts, bar charts and so forth.
Chapter Five includes the data analysis and discussion in line with the methodology discussed
in Chapter there and in the light of past empirical research discussed under chapter two. Data
analysis and discussion is key part of a case study research as it provides the ground for the
conclusions. In this research it provides ground to assess whether the foresaid objectives
achieved or not.
Chapter four demonstrated different Management Control systems practiced by Vodafone PLC.
It explained comply with traditional management controls systems (MCS) like Balanced
Scorecard, Quality circles and Total Quality management (TQM. In addition to that chapter four
explained relationship between management control systems and its contribution towards
customer base. , Revenue Operational Cost and so forth
5.1 Concluding Remarks
Conclusion of this research will be derived from the data analysis and discussion in the Chapter
four . Conclusion will be carried out in line with the research objectives identified in the Chapter
One.
Conclusions over first and second objectives will be discussed together. The two of objectives
were to identify and review the practice management control system in Vodafone PLC and
observe that the degree of which applicability of theoretical management control techniques in
practical. Some of management control systems (MCS) unique to each organization within the
industry. There are approximately eighty Management control systems (MCS) of Dilog Vodafone
PLC.In Vodafone perspective Management control systems (MCS) are the back born of the
company .it gives competitive advantages over other organizations. There are approximately
eighty Management control systems (MCS) of Vodafone PLC Unique management control
systems practices by dialog Vodafone PLC. are SAP Enterprise Resource Planning (ERP)
System , COSO model, Enterprise Risk as well as they comply with traditional management
controls systems (MCS) like Balanced Scorecard, extensive planning process, Benchmarking,
Quality circles, Total Quality Management (TQM),Corporate Governance ,Comply with
international standards and so forth. All those management control systems are practicing
together. We cannot segregate any divisions which use only traditional management control
systems as well unique management control .
According to the data gathered, Author remarked the combination of traditional management
Common used management control Systems and Unique Management control Systems
practices Vodafone PLC.As follows Table 5.1
Division
Table: 5.1 Usages of Common MCS and Unique MCS
The final objective is to observe the relationship between management control system and their
impact to organization Performances. Concluding final objective, There are lot management
controls are in place in Vodafone PLC and they are inter related each other and where we are
unable to isolate each management control system and distinguish their performance
accordingly.
According to data gathered, They committed that most of the management control systems are
aggregately affect the organizational performances. Where as some management control
systems affected the organizational performances over other management control systems .As
an example Balance Scorecard, Quality circles and SAP Enterprise Recourses and so on.
consistent with the data gathered from Semi structured interviews conducted by over the phone
and Documentation reviews, backed up by data gathered from distributing Questionnaires
.Author can conclude the relationship between of management Control Systems and impact
over organizational performances .As follows Figure 5.2 and Table 5.2.based on the knowledge
gathered from this case study.
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Management Control systems
Table 5.2: Relationship between MCS and Organizational Performance
5.2 Future Research Directions
This study opens a number of opportunities for future research. Firstly methodological
improvement may be made in a similar setting by increasing the length of study and the unit of
analysis to investigate the management control techniques in telecommunication industry. Data
could be collected at lower levels and more widely across the organization. to better understand
the achievement of balanced objectives it would be interesting to also obtain the views and
perceptions of a variety of customers regarding the effectiveness of Managements Control
Systems (MCS) practices by the organizations.
A second approach to extending this study is to investigate the use of the Management Control
Systems in specific strategic decisions .That is relationship of MCS and strategy decision
makings in telecommunication industry.
Thirdly research can be conducted to whether management control can minimize the disruption
caused by strategic change over time.
Finally research could also conduct to Exploration of the nature and extent to which the role and
composition of MCS changes a company matures.
5.3 Action Plan
Activity
by
01 Sep 2010
01 Sep 2010
07 Sep 2010
07 Sep 2010
30 0ct 2010
5.4 Gantt chart
Action
6.0 References
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Telecommunications Environment on Sri Lanka, A study by Antelope Consulting for the ITU and
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2. Anthony, R.N. (1965) Management Planning and Control Systems: A Framework for Analysis,
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3. Christpher D.Ittner,David F.Larcker (1996),Quality Strategy, Strategic Control systems and
organizational performances, The Wharton School,university Of Pennsylvania.Philadelphia,PA
19104-6365
4. David Brown, (1996), Multiple Objectives, Management Control Systems, and the Balanced
Scorecard: An Exploratory Case Study, University of Technology Sydney, University of
Technology Sydney, Markus Granlund, University of Technology Sydney
5. Gunawardene, P. (1999a), Interconnection: The Sri Lankan Experience, Journal of the Asia
Pacific Telecommunity, 2 (1), 16-19.
6. Govindarajan, V. & Gupta, A.K. (1985) Linking Control Systems to Business Unit Strategy:
Impact on Performance, Accounting, Organizations and Society, vol. 10,
7. Grant, R.F. (2003) Strategic planning in a turbulent environment: evidence from the oil
majors, Strategic Management Journal, vol 24, pp 491517.
8. Gray, B (1990) The enactment of management control systems: a critique of
Simons,Accounting, Organizations and Society, vol. 15, Nos 1/2, pp 145-148.
9. Gupta, A. K. & Govindarajan, V. (1984) Business Unit Strategy, Managerial Characteristics,
and Business Unit Effectiveness at Strategy Implementation, Academy of Management Journal,
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10. Langfield-Smith, K. (2005) What do we know about Management Control Systems
andStrategy In C.S. Chapman (ed) Controlling Strategy: Management, Accounting,
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11. Samarajiva, R (2000b), The Role of Competition in Institutional Reform of
Telecommunications,
12. Simons, R. (2000) Performance Measurement and Control Systems for Implementing
Strategy, Prentice-Hall, Upper Saddle River. NJ.
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