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Unit 12: Management Control for Differentiated Strategies
Sukhpreet Kaur, Lovely Professional University

Unit 12: Management Control for Notes
Differentiated Strategies

CONTENTS
Objectives

Introduction
12.1 Definition
12.2 Corporate Strategy and Control System
12.3 Business Unit Strategy and Control System

12.3.1 Mission
12.3.2 Competitive Advantage
12.4 Summary
12.5 Keywords

12.6 Review Questions
12.7 Further Readings

Objectives

After studying this unit, you will be able to:

 Discuss how to develop a strategic vision: The first direction-setting task
 Explain the establishing objectives: The second direction-setting task
 Explain strategies and two levels of strategies

Introduction

Management control systems are tools to implement strategies. Strategies differ between
organizations and controls should be tailored to the requirements of specific strategies. Different
strategies require different task priorities, different key success factors and different skills,
perspectives and behaviours.
Strategies help an organization achieve its goals.

12.1 Definition

Strategies describe the general direction in which an organization plans to move to attain its
goals. Every well-managed organization has one or more strategies, although they may not be
stated explicitly.

A firm develops its strategies by matching its core competencies with industry opportunities.
Figure 12.1 lays down schematically, the development of a firm’s strategies. First of all, an
environment scanning is made in the light of the industry in which the company is operating to
find out opportunities and threats. Next comes internal analysis of the company in the sphere of
technological know-how, manufacturing know-how, marketing know-how, distribution and
logistics know-how (major operating functions in the organization) to find out strength and

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