The shift to remote and hybrid working kickstarted by the pandemic prompted Ireland’s big four firms to rethink their management control systems, write Stefan Jooss and Michelle Carr
The COVID-19 pandemic drastically altered the way we work, pushing firms to rethink their traditional management systems. Before the pandemic, management controls were designed for an in-person, office-based environment.
However, with the sudden shift to remote and hybrid work models, firms had to quickly adapt their management control systems to ensure they could continue functioning effectively.
Our research looked at how the big four accounting firms – Deloitte, EY, KPMG and PwC – changed their management control systems during the pandemic.
This research included 42 interviews with human resource directors, audit and tax directors, and associates across these firms to understand how their management control practices evolved.
What we mean by “management controls”
When we talk about management control systems, we mean the processes, tools and practices firms use to ensure that employees are working towards their goals. These systems influence behaviour, decision-making and how resources are used.
Traditionally, management controls have been structured around four key areas:
Actions (what employees do);
Results (what they achieve);
Personnel (who they are); and
Culture (how things are done in the firm).
In the past, these controls worked well for office environments where employees could be monitored closely.
With remote and hybrid work, however, firms had to rethink these systems to ensure they could still meet client demands and support their employees.
The shift to hybrid work
During the pandemic, it became apparent that few firms had a clear idea of how to make remote and hybrid work a long-term solution.
A McKinsey survey found that nearly 70 percent of firms lacked a solid plan for implementing these new work models.
For the big four firms, this presented a significant challenge. They needed to balance client expectations with the new realities of working remotely.
Our study found that, while hybrid work presented unique challenges, it also created opportunities to rethink traditional management controls.
We found that big four firms reimagined their personnel and cultural controls to reflect the new working environment, while also making adjustments to their action and results controls. Key changes to management controls include:
Personnel and cultural controls
To maintain a strong company culture and ensure employee well-being, the big four firms had to focus more on virtual team-building activities and regular check-ins. This helped maintain connectivity among teams, even when working remotely. Training and development also shifted online, ensuring employees continued to grow professionally despite being away from the office.
Action controls
Remote work required a greater emphasis on monitoring daily activities. While the big four firms had systems in place for tracking work, they had to increase their reliance on digital tools to ensure work was being completed effectively. This meant more frequent check-ins and the use of collaboration platforms like Microsoft Teams or Zoom to keep teams connected.
Results controls
Evaluating employee performance in a hybrid work environment was a challenge. Traditionally, performance reviews were based on clear, measurable goals, but with remote work, firms had to be more flexible. We found that the big four firms started using more informal and frequent performance evaluations, focusing on ongoing feedback rather than just yearly reviews.
How these changes are shaping the future of work
The changes made to management controls during the pandemic aren’t just temporary solutions. Big four firms have been considering hybrid work as part of their long-term strategy.
At the same time, we have recently seen increasing efforts to a return to office, so time will tell whether there is longevity in hybrid work in the accounting sector. Our research found two competing perspectives to balance:
1. Client perspective
Big four firms need to maintain business continuity and meet high professional standards. Clients expect seamless service, and firms need to ensure their teams are working efficiently, even in a remote or hybrid environment.
2. Employee perspective
On the other hand, employees want flexibility, better work-life balance, and opportunities for career development. Hybrid work offers these benefits, but firms need to ensure they don’t lose the sense of connectivity and learning that comes from working in an office environment.
What this means for accountants
As accountants, you are likely seeing the effects of these changes in your own work. Here are a few practical takeaways from our study that can help you navigate this new landscape:
Adapt to hybrid working: Hybrid work may continue, so it’s essential to get comfortable with new tools and systems. Whether it’s project management software, video conferencing, or performance tracking tools, mastering these will help you stay connected and efficient.
Stay engaged with your team: Even though you may not be in the office as often, it’s important to maintain strong relationships with your colleagues. Regular check-ins, virtual meetings, and team-building activities can help create a sense of belonging, even when working remotely.
Embrace flexibility: Performance evaluations are becoming more flexible, focusing on ongoing feedback rather than just end results. Be proactive in seeking feedback from your managers and use it as an opportunity to grow and develop.
Balance client expectations and work-life balance: Clients expect the same high standards, even when you’re working remotely. However, hybrid work allows for better work-life balance, so take advantage of this flexibility while ensuring you continue to deliver top-quality service.
Looking Ahead
As firms continue to adjust to hybrid work, management control systems will keep evolving. The changes made during the pandemic have provided valuable insights into how firms can operate more flexibly while still maintaining high standards.
For accountants, this means staying adaptable, learning new skills, and finding the right balance between client demands and personal well-being.
In autumn 2024, hybrid work continues to shape the accounting sector, particularly within the big four firms.
Recent developments highlight the balance between flexibility and oversight, as seen in PwC’s implementation of employee location tracking, which may raise concerns about privacy while aiming to enhance performance management.
Meanwhile, Deloitte's expansion of office spaces signals a commitment to maintaining physical work environments, reflecting a hybrid model that values both in-office collaboration and remote work flexibility.
These shifts underscore the sector's ongoing evaluation and evolution, as firms strive to adapt to changing workforce expectations while ensuring productivity and compliance with regulatory demands.
This research by Stefan Jooss of The University of Queensland and Michelle Carr of University College Cork, has been kindly supported by funding from the Institute of Chartered Accountants Ireland Educational Trust. The authors’ gratitude also goes to the Ireland’s big four firms in Ireland for facilitating the research activities
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