Examine the use of Management Control System and Sustainable Innovation: The mediating impact of Employee Performance Evidence from supermarkets in Sri Lanka

Abstract

This thesis is on the extent to which Management Control Systems (MCS) have role in enacting Sustainable Innovation, using Employee Performance as a mediator, in the case of Sri Lankan supermarkets. A quantitative methodology is used and information on 125 employees is collected by means of structured questionnaires. The conceptual framework integrates four key MCS components: By analyzing the upbrought impacts of these Diagnostic, Interactive, Belief and Boundary Control Systems using statistical tools such as correlation and regression, this paper examines how they influence sustainable innovation. Findings indicate that all MCS components significantly influence sustainable innovation, mediated by employee performance. All four independents’ variables demonstrated positive impact on sustainability initiatives. The study establishes the role that MCS play in aligning employee behavior with organizational sustainability goals, thereby promoting supermarket industry innovation. The integration of MCS and sustainability strategies are proposed, with practical recommendations for continuous employee engagement and adaptive control mechanisms to support the pull and push of internal and external pressures. This contribution is to the field of sustainable business management and to industry practitioners.