The role of management control systems in the performing arts

Abstract

Summary of the thesis Over recent decades the arts sector has faced an increased focus on economic factors. Following this, there has been an increased demand for evaluation regarding economic measures. Economic measures, and the focus on commercialism and profit-based arguments, however, contains fundamental differences from the performance arts’ more intangible benefits for the larger community. Management accounting and control have thus often been regarded as detached from the range and complexity of artistic work. The primary aim of this dissertation, however, is not to address the challenges and problems with management controls in the performing arts field, but to go beyond these issues by studying the role, more specifically the design and use, of management controls within this field. By studying the role of management controls in the Norwegian performing arts sector, this dissertation not only responds to calls for research on arts organisations, but also contributes to the growing literature on management accounting and control in the popular culture and more generally to research on the role of management controls in the context they operate. The aim of the dissertation is addressed in four individual papers with different objectives, theoretical frameworks and research methods. Paper 1 analyses the role of performance measures in the Norwegian symphony orchestra field. Prior research has claimed that the coexistence of institutional logics may create tension and conflict, and the paper investigates how the role of performance measures is influenced by the multiple institutional logics in this field. The study found little conflict due to the performance measures, and the paper shows that multiple logics can be embedded in organisations in heterogeneous ways and have different implications, as a number of factors may act as filters on the way different logics shape the role of performance measures. Paper 2 is a case study of a large Norwegian festival that had faced large financial difficulties because of budget deficits, and subsequently designed and implemented a new budget system to regain financial control. The paper, hence aims to investigate the design and use of budgets under conditions unique to a festival, and sets out to add to knowledge regarding how budgets can contribute to the financial outcome of festivals, without tempering with artistic quality. Accordingly, the paper places itself into the dilemma between creativity and management control, as it questions how the budget, as a management control tool, can integrate creativity with management control. Paper 3 builds on the findings from Paper 2, and is based on survey data from 48 of the largest Norwegian festivals to investigate further the use of budgets in festivals. The study sets out from traditional budget critique and the problems related to budgeting. However, this criticism has not led organisations to reject budgets, and recent research show the overall satisfaction with budgets is good. The first aim of the paper is, hence to describe the use of budgets in Norwegian festivals. Previous research also shows that perceived environmental uncertainty influences budgeting practices, and the second aim of the paper is thus to investigate the relation between perceived environmental uncertainty and the use of budgets in Norwegian festivals. Paper 4 is a further exploration of the use of management control tools, primarily budgets, in Norwegian festivals. As Paper 3, Paper 4 also builds on the contingency theory, where the design and use of management controls is showed to be a consequence of organisation-specific characteristics. However, whereas Paper 3 builds on the contingency factor of perceived environmental uncertainty, this paper takes the outset from upper echelons theory and investigates the variation in control system design and how this is associated with the personal characteristics of festival leaders