Degree Name

Doctor of Philosophy (PhD thesis)


School of Accounting and Finance - Faculty of Commerce


Research and Development organisations deal with different environments, purposes, goals, and employees characteristics compared to non-Research and Development organisations. Research and Development (R&D) activity is a learning process that makes the R&D units deal with relatively uncertain conditions in conducting their tasks. The R&D activity is a non-repetitive task with a purpose to contribute new knowledge whether or not it has specific commercial objectives. Such a situation makes the goals relatively difficult to measure quantitatively and monetarily. This thesis is built on the thrust of those characteristics of R&D organisations and uses a descriptive case study research strategy to conduct an investigation into how management control systems are applied in public sector R&D organisations in Indonesia and why such practices are chosen. This thesis develops a framework that consists of four core elements of management control systems that need to be considered in setting the control function. The framework is used to explain how and why such practice was implemented. This thesis also involves the historical background of Indonesia from its colonial past to the present. The study has no intention to generalise its finding, rather it hopes to make a contribution to the body of knowledge and practice, with its consideration of the four core elements involved in setting management control systems. The four core control elements are Desired Ends, Actors, Control Implementation, and Control Tools. The Desired Ends consists of two sub-elements namely Yardstick and Direction. The Actors consists of five sub-elements; Behavioural, Motivational, Domination, Power, and Decision Space. The Control Implementation contains two sub-elements; Control Types and Timing, in which the Control Types consists of Formal and Informal types, and Timing of implementation contains three stages as Input, Process and Output. The practice of management control systems in Indonesia was found to be an archaic and centralised system. Centralisation of control was found to be placed in the central government offices in Jakarta. Such practice may be influenced by several factors including historical, political, and cultural as well as the nature of the R&D activities. In addition, the management control systems applied were found to be both formal and informal during the input, process and output stages. The control tools practiced by the controller were found to be directional, bureaucratic, and mostly emphasised the financial dimension. The use of the scientific dimension was only found to be used during a seminar presentation. This thesis contributes to the body of knowledge particularly in the area of management control systems by showing how and why such practices of management control system exist in the government sector in Indonesia. The conclusion of this thesis is that there is a need to consider the core control elements simultaneously in designing a management control systems particularly for a research and development organisation.

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