The Mediating Role of Business Strategies between Management Control Systems Package and Firms Stability: Evidence from SMEs in Malaysia
Abstract
:1. Introduction
2. Literature Review and Hypothesis Development
2.1. MCS as a Package (MCSP)
2.2. Business Strategies
2.3. MCS Package, Business Strategies, and Firm Sustainability
3. Methodology
3.1. Research Questionnaire
3.2. Population and Sampling
3.3. Sample Size
3.4. Statistical Analysis Results
3.4.1. Measurement Model (Outer Model)
Convergent Validity
Discriminant Validity
3.4.2. The Structural Model and Hypotheses Testing
3.5. Mediation Analysis (Indirect Relationship)
3.6. The Predictive Relevance of the Theoretical Model
4. Discussion
5. Conclusions
5.1. Theoretical Contribution
5.2. Practical Contribution
6. Future Directions
Author Contributions
Funding
Conflicts of Interest
References
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States | %Age | States | %Age | States | %Age | States | %Age |
---|---|---|---|---|---|---|---|
Selangor | 19.8 | Penang | 7.4 | Kelantan | 5.1 | Terengganu | 3.2 |
Kuala Lumpur | 14.7 | Sarawak | 6.7 | Pahang | 4.1 | Perlis | 0.8 |
Johor | 10.8 | Sabah | 6.2 | Negeri Sembilan | 3.6 | Labuan | 0.3 |
Perak | 8.3 | Kedah | 5.4 | Malacca | 3.5 | Putrajaya | 0.1 |
First-Order Constructs | Second-Order Constructs | Items | Factor Loadings | AVE | CR | R2 | Cronbach’s Alpha |
---|---|---|---|---|---|---|---|
Planning | PC1 | 0.808 | 0.628 | 0.922 | 0.901 | ||
PC11 | 0.789 | ||||||
PC13 | 0.793 | ||||||
PC3 | 0.806 | ||||||
PC5 | 0.85 | ||||||
PC6 | 0.799 | ||||||
PC8 | 0.694 | ||||||
Cultural | CC1 | 0.808 | 0.613 | 0.904 | 0.873 | ||
CC11 | 0.813 | ||||||
CC15 | 0.691 | ||||||
CC3 | 0.85 | ||||||
CC5 | 0.823 | ||||||
CC7 | 0.7 | ||||||
Cybernetic | CBC1 | 0.747 | 0.554 | 0.896 | 0.866 | ||
CBC2 | 0.84 | ||||||
CBC3 | 0.85 | ||||||
CBC4 | 0.673 | ||||||
CBC5 | 0.739 | ||||||
CBC6 | 0.692 | ||||||
CBC7 | 0.645 | ||||||
Rewards and Compensation | RC1 | 0.653 | 0.596 | 0.853 | 0.767 | ||
RC3 | 0.855 | ||||||
RC4 | 0.862 | ||||||
RC6 | 0.694 | ||||||
Administrative | ADC1 | 0.846 | 0.704 | 0.922 | 0.893 | ||
ADC2 | 0.895 | ||||||
ADC5 | 0.895 | ||||||
ADC6 | 0.785 | ||||||
ADC8 | 0.764 | ||||||
MCS package | Planning | 0.808 | 0.631 | 0.894 | 0.943 | ||
Cultural | 0.852 | ||||||
Cybernetic | 0.851 | ||||||
Rewards and Compensation | 0.743 | ||||||
Administrative | 0.708 | ||||||
Cost Leadership | CL1 | 0.824 | 0.708 | 0.906 | 0.091 | 0.862 | |
CL2 | 0.842 | ||||||
CL4 | 0.854 | ||||||
CL5 | 0.845 | ||||||
Differentiation Strategy | DF1 | 0.918 | 0.509 | 0.799 | 0.017 | 0.764 | |
DF2 | 0.521 | ||||||
DF3 | 0.684 | ||||||
DF4 | 0.674 | ||||||
Firms Sustainability | FS1 | 0.866 | 0.634 | 0.896 | 0.482 | 0.858 | |
FS2 | 0.711 | ||||||
FS3 | 0.811 | ||||||
FS4 | 0.83 | ||||||
FS5 | 0.754 |
Variables | MCSP | CL | DF | FS |
---|---|---|---|---|
Management control system package (MCSP) | 0.794 | |||
Cost leadership (CL) | 0.302 | 0.841 | ||
Differentiation strategy (DS) | 0.130 | 0.482 | 0.714 | |
Firm stability (FS) | 0.482 | 0.453 | 0.546 | 0.796 |
Hypotheses | Paths | Original Sample | Sample Mean | Std. Dev. | t-Values | p-Values | Results |
---|---|---|---|---|---|---|---|
H1 | MCSP --> FS | 0.388 | 0.384 | 0.040 | 9.718 | 0.000 | Accepted |
H2 | MCSP --> DF | 0.130 | 0.134 | 0.064 | 2.025 | 0.021 | Accepted |
H3 | MCSP --> CL | 0.302 | 0.301 | 0.061 | 4.975 | 0.000 | Accepted |
H4 | DF --> FS | 0.436 | 0.442 | 0.062 | 7.078 | 0.000 | Accepted |
H5 | CL --> FS | 0.125 | 0.127 | 0.058 | 2.149 | 0.016 | Accepted |
Hypotheses | Paths | Original Sample | Sample Mean | Std. Dev. | t-Values | p-Values | Results |
---|---|---|---|---|---|---|---|
H6 | MCSP-> DF-> FS | 0.057 | 0.059 | 0.030 | 1.891 | 0.029 | Accepted |
H7 | MCSP-> CL-> FS | 0.038 | 0.038 | 0.019 | 1.962 | 0.025 | Accepted |
Total | R2 | SSO | SSE | Q2( = 1–SSE/SSO) |
---|---|---|---|---|
Cost leadership | 0.091 | 1536.000 | 1443.221 | 0.060 |
Differentiation strategy | 0.017 | 1536.000 | 1532.626 | 0.002 |
Firm sustainability | 0.482 | 1920.000 | 1396.124 | 0.273 |
© 2019 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (http://creativecommons.org/licenses/by/4.0/).
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Haseeb, M.; Lis, M.; Haouas, I.; WW Mihardjo, L. The Mediating Role of Business Strategies between Management Control Systems Package and Firms Stability: Evidence from SMEs in Malaysia. Sustainability 2019, 11, 4705. https://doi.org/10.3390/su11174705
Haseeb M, Lis M, Haouas I, WW Mihardjo L. The Mediating Role of Business Strategies between Management Control Systems Package and Firms Stability: Evidence from SMEs in Malaysia. Sustainability. 2019; 11(17):4705. https://doi.org/10.3390/su11174705
Chicago/Turabian StyleHaseeb, Muhammad, Marcin Lis, Ilham Haouas, and Leonardus WW Mihardjo. 2019. "The Mediating Role of Business Strategies between Management Control Systems Package and Firms Stability: Evidence from SMEs in Malaysia" Sustainability 11, no. 17: 4705. https://doi.org/10.3390/su11174705