This chapter covers the following objectives:

  • The value of effective strategic control systems in strategy implementation.
  • The key difference between “traditional” and “contemporary” control systems.
  • The imperative for “contemporary” control systems in today’s complex and rapidly changing competitive and general environments.
  • The benefits of having the proper balance among the three levers of behavioral control: culture, rewards and incentives, and boundaries.
  • The three key participants in corporate governance: shareholders, management (led by the CEO), and the board of directors.
  • The role of corporate governance mechanisms in ensuring that the interests of managers are aligned with those of shareholders from both the United States and international perspectives.