278 ACCOUNTING FOR MANAGERS
in management control seem to have followed a similar pattern, so we use the
schema suggested by Scott (1981) for categorizing developments in organization
theory as a framework for organizing this part of our review. We would argue that
systems thinking has had an important influence on the development of MCSs
andScott’sschemaisbasedonasystemsapproach,soitistothiswenowturn.
Cybernetics and systems theory
Organizational theory in general and management control research in particular
have been influenced considerably by cybernetics (the science of communication
and control (Weiner, 1948). These insights have been extended in the holistic
standpoint taken by general systems theory and the ‘soft systems’ approach
(Checkland, 1981). Its central contribution has been in thesystemicapproach it
adopts, causing attention to be paid to the overall control of the organization, in
contrast to thesystematicapproach dominant in accounting control, which has
often assumed that the multiplication of ‘controls’ will lead inexorably to overall
‘control’, a view roundly routed by Drucker (1964). Cybernetics and systems
theory have developed in such an interlinked manner that it is difficult to draw
a meaningful dividing line between them (for a fuller surveyseeOtley, 1983),
although a simple distinction would be to suggest that cybernetics is concerned
with closed systems, whereas systems theory specifically involves a more open
perspective.
The major contribution of cybernetics has been in the study of systems in which
complexity is paramount (Ashby, 1956); it attempts to explain the behaviour of
complex systems primarily in terms of relatively simple feedback mechanisms
(Wisdom, 1956). There have been a number of attempts to apply cybernetic
concepts to the issue of management control, but these have all been of a theoretical
nature, albeit based on general empirical observation. The process of generating
feedback information is fundamental to management accounting on which much
management control practice rests, although this is not usually elaborated in any
very insightful manner. However, Otley and Berry (1980) developed Tocher’s
(1970) control model and applied it to organizational control. They maintain that
effective control depends upon the existence of an adequate means of predicting the
consequences of alternative control actions. In most organizations such predictive
models reside in the minds of line managers, rather than in any more formal
form, and they argue that improvements in control practice need to focus on
improving such models. It is also argued that feedforward (anticipatory) controls
are likely to be of more importance than feedback (reactive) controls. This echoes
previous comments by authors such as Ashby (1956), who points to the biological
advantages in controlling not by error but by what gives rise to error, and Amey
(1979) who stresses the importance of anticipatory control mechanisms in business
enterprises.
Arguably the most insightful use of cybernetic ideas applied to management
practice is also one of the earliest. Vickers (1965, 1967) applied many cybernetic
ideas to management practice during the 1950s. Although developed in a primarily
closed systems context, he also started to explore the issue of regulating institutions