Martine Cools

Management control in inter-organizational relationships:Lessons learnt from public-private partnerships

Public-private partnerships (PPPs) have become increasingly common. However, reported failure rates are high, underlining the challenge to effectively govern such relationships. The purpose of this paper is to empirically investigate the management control structure for different types of PPPs by adopting a comparative case study approach. The two cases under study are partnerships between municipalities and their private partners: a long-term infrastructure project and an urban regeneration project. Given the different nature of the activities and the accompanying risks, the PPP literature suggests that the cooperation in these PPPs is organized in very different ways, namely loose versus tight. We propose (1) that outcome-based control mechanisms play an important role in managing loosely organized PPP projects and (2) that behaviour and social control mechanisms play an important role in managing tightly organized PPP projects. Although our results support these propositions, our analysis also suggests that existing frameworks for private inter-organizational relationships (IORs) are insufficient for explaining governance structures in PPPs. Given the specific nature of PPP arrangements, we identify a number of socio-political risks and related management control mechanisms not typically discussed in theories of private IORs. More specifically, we conclude that conveners and project champions play an important role as political controls in the success of PPPs.

To Shift or Not To Shift? Intertemporal Income Shifting as a Response to the Risk Capital Allowance Introduction in Belgium

Abstract This study examines how firms shift profits from one period to another in response to the introduction of an allowance for corporate equity. We focus on the introduction of the risk capital allowance in Belgium by the law of 22 June 2005. We predict and find that firms with relatively low (but positive) earnings in 2006 have incentives to defer profits in 2005 and that this effect is stronger for firms with higher equity ratios. Conversely, we predict that firms that are highly profitable in 2006 and have large net operating loss carryforwards in 2005 have incentives to accelerate profits. We find that only subsets of firms react to the latter incentive, in particular firms with higher equity ratios. Our findings show that tax-related benefits motivate firms to engage in conforming tax avoidance and provide evidence of cross-sectional variations in their reaction to these incentives. These insights contribute to the literature outlining the costs and benefits of changes in tax regimes and documenting earnings management in response to tax incentives in a high book-tax-conform environment.

Characterizing supply chain visibility – a literature review

Purpose The purpose of this paper is to present a literature review that aims to provide insight into the characteristics and effectiveness of supply chain visibility (SCV), as well as to identify metrics that capture these aspects in business processes. Design/methodology/approach A systematic review of the supply chain literature is conducted to identify the characteristics and the effectiveness of SCV. The synthesis of SCV effectiveness and its metrics are based on the process-oriented approach which relates the effectiveness of SCV to improved business performance. Findings This study reveals that the characteristics of SCV can be captured in terms of the accessibility, quality, and usefulness of information. The benefits of SCV are found to extend beyond improvements to operational efficiency of business processes or to the strategic competencies of an organization. Practical implications This study underlines that clear agreements between all players involved in the SC can help to solve problems caused by information completeness (type and amount of information), and unlock the full potential of SCV projects. Originality/value By using a process-oriented approach, this review provides a comprehensive explanation of the functions of SCV, as well as its first-order effects, in terms of automational, informational, and transformational characteristics.