Management Control and Value Creation in Public Entities

Financial Accounting and Management Accounting, and Strategic and Operational Management.

Expository method to approach the theoretical contents.

Active and interrogative method for case studies and scientific articles.

The curricular unit of Management Control and Value Creation in Public Entities, attentive to the primordial and increasingly relevant role that Management Control has been assuming in recent years in Public Entities, due to the greater complexity of management and the consequent need to improve its performance and obtain better results in line with the entity’s objectives.

The aims of this curricular unit are to provide master’s students with the necessary knowledge to:

1 – Analyze the transposition of management concepts and processes (Strategic, Tactical and Operational) originally conceived in the administration of private companies to the field of administration public entities.

2 – Define the Mission, Vision, Values, ​​and Objectives of the Public Entity, considering public policies.

3 – Analyze the main principles that guide public management activity and its evaluation and control, the principles of effectiveness, efficiency and economy, effectiveness or impact, equity, responsibility (accountability).

4 – Identify the role, objectives, recipients, and diversity of instruments of a management control system in Public Entities.

5 Analyze, design, develop and implement management control and evaluation instruments in public entities, both in the strategic and intermediate/functional scope, as well as in the operational one.

6 – Encourage the critical analysis of design solutions for management control systems.

Upon completion of the Curricular Unit, the student should be able to:

Understand the strategic, intermediate/functional, and operational planning process of organizations.

Articulate, adapt and insert management control in the strategic, intermediate/functional, and operational management process, with a view to creating value in public entities.

Distinguish the objectives and processes of “CONTROL” and “ASSESSMENT”.

Know THE CONTROL AND EVALUATION INSTRUMENTS IN PUBLIC MANAGEMENT, WHETHER AT THE STRATEGIC, FUNCTIONAL AND OPERATIONAL LEVEL, Benchmarking, budget management and control, Tableau de Bord (public performance evaluation indicators) and BSC – Balanced Scorecard.

Knowing how to identify the KEY CRITERIA THAT THE PUBLIC PERFORMANCE ASSESSMENT INDICATORS MUST FOLLOW

Know PUBLIC BUDGET MANAGEMENT MODELS:

The incremental budget for the year (by nature)

Performance/functional budgets

The budget by programs/projects

Activity-based budget

The budget by responsibility centers (costs, results, investment).

Knowing and knowing how to use the BSC – BALANCED SCORECARD as a strategic management control instrument

Can know how to diagnose the existing management control and evaluation systems in the organization, and design the bases to conceive, develop and implement a management control and evaluation model suited to the needs of the public entity.

They must also be able to develop a schedule sheet that allows to support the construction of the balanced scorecard (BSC), and the tableau de bord in public entities

.

1. Public Management versus Private Management; Evolution of public management, “Managerialism, New Public Management”

 2. Planning Levels and Tools: Strategic, Intermediate/Functional and Operational.

 3. Evaluation of public management: Concepts, principles, and key criteria to which the performance evaluation indicators of the performance of good public management must comply.

 4. Public Management Control Instruments:

    4.1 Steering Techniques 

    4.2 Organization of Behavior and performance assessment: Responsibility Centers.

    4.3 Communication and Dialogue

 5. Design of management control systems.

NAO

Fundamental Bibliography

ANTHONY, Robert N., GOVINDARAJAN, Vijay – Management Control Systems,12ª Ed. , McGraw-Hill, 2006

Cardoso, A., Silva, T.F.B.d., Takagi, N., Silva, C. and Micelli, A. (2022), “A value chain development model for the public sector”, Business Process Management Journal, Vol. 28 No. 5/6, pp. 1229-1250. https://doi.org/10.1108/BPMJ-09-2021-0619

Daft, R., Management /New era of Management, 2005, 7ª Ed., Thompson/South-Western

Felício, T., Samagaio, A. & Rodrigues, R. (2021). Adoption of management control systems and performance in public sector organizations, Journal of Business Research, Volume 124, Pages 593-602. ISSN 0148-2963, https://doi.org/10.1016/j.jbusres.2020.10.069.

van Helden, J. and Reichard, C. (2019), “Management control and public sector performance management”, Baltic Journal of Management, Vol. 14 No. 1, pp. 158-176. https://doi.org/10.1108/BJM-01-2018-0021

KAPLAN, R. e NORTON, The Balanced Scorecard: translation strategy into action, Boston, Mass.: Havard Bussiness Scholl Press (FEP – 658.5-62), 1996

MERCHANT, KA E STEDE WAV – Management Control Systems, Ed. Prentice Hall, 2007)

NEVES, João C., JORDAN, H., RODRIGUES, José A. –10ª Ed., Áreas Editora, O Controlo de Gestão ao Serviços da Estratégias e dos Gestores, 2015

Complementary Bibliography

Bracci, E. and Tallaki, M. (2021), “Resilience capacities and management control systems in public sector organisations”, Journal of Accounting & Organizational Change, Vol. 17 No. 3, pp. 332-351. https://doi.org/10.1108/JAOC-10-2019-0111

Höglund, L., Mårtensson, M. and Thomson, K. (2021), “Strategic management, management control practices and public value creation: the strategic triangle in the Swedish public sector”, Accounting, Auditing & Accountability Journal, Vol. 34 No. 7, pp. 1608-1634. https://doi.org/10.1108/AAAJ-11-2019-4284

Nicolas Berland, Benjamin Dreveton. Management control system in public administration: beyond rational myths. Accounting Reform in the Public Sector: Mimicry, fad or Necessity, Réseau Cigar, p. 21-37, 2006.