Adding value to performance measurement by using system dynamics and multicriteria analysis

Environmental Education Performance Evaluation in a Higher Education Institution

The performance evaluation models proposed in the scientific literature to support the decision-making process in the context of sustainability in Higher Education Institutions (HEIs) present gaps with respect to the design process. In relation, to the management of environmental education in HEIs, there is an absence of decision support models. In this context, the objective of the research is to build a model for evaluating the performance of environmental education for an undergraduate course at a public university. It is a case study, with data collection through interviews with the Course Coordinator, complemented by questionnaires and documental analysis. The intervention instrument used was the Multicriteria Methodology for Decision Aiding-Constructivist (MCDA-C). The main results were explored showing the process of building a performance evaluation model, considering the singularity of the context, the flexibility in the elaboration process and interactivity with different stakeholders. Additionally, efforts were focused on the presentation of the final assessment model, demonstrating the potential of the MCDA-C methodology as a practical tool to support the decision-making process, and on the discussion of the model developed in relation to the literature reviewed. The model built allows the decision maker to understand the environmental education intertwined with the course, to assess the current situation and the desired end state, as well as the necessary actions for its management. In addition to the constructivist perspective, the model meets the Stakeholder Theory; explains the advantages, using participatory approach methodologies and performance indicators have characteristics of a functional system.

System dynamics applications in performance measurement research

Purpose

This study investigates system dynamics (SD) applications in performance measurement (PM) research and practice. A bibliometric analysis was conducted to investigate the maturity of this research area and identify opportunities for development.

Design/methodology/approach

A systematic literature review (SLR) was conducted to provide a comprehensive and rigorous review of the existing literature. The search was conducted on 10 platforms identifying 97 publications, which were evaluated using bibliometric analysis.

Findings

The analysis revealed that applications of SD are most commonly used in the PM system design phase to model organisational performance. In addition, the bibliometric results showed a highly dispersed author set, with most studies using exploratory methods, suggesting that the research is in a relatively early stage of development. The results also showed that over 50 per cent of the causal models were not validated, emphasizing an important methodological gap in this research area.

Research limitations/implications

This SLR is limited to indexed publications on 10 platforms, the search strategy was relatively precise and only available papers in English language were used for the literature review.

Practical implications

PM systems supported by SD can help managers understand and improve organisational behaviours by addressing dynamic complexities and relationship between variables. This study evaluates the maturity of this research area including information about the current development of this area and opportunities to build on existing knowledge.

Originality/value

This study identifies how SD approaches are applied to PM and highlights areas that require further research consideration. This paper is the first of two publications to result from this study and focuses on evaluating the current state of this research area.

Integrating performance measurement, system dynamics, and problem-solving methods

Purpose

Transport logistics systems in companies with additional public service roles are complex and could benefit from new approaches to performance management. Existing approaches tend to be fragmented; thus, the purpose of this paper is to integrate balanced performance measures, a dynamics model, and the problem-solving method into a new model.

Design/methodology/approach

An integrated framework is developed by reviewing literature and synthesising attributes of performance measurement systems, system dynamics and problem-solving methods. The framework is then applied to a multiple-role company’s sea transportation system. The study uses statistical methods to identify performance indicators, management interviews with document study to develop a dynamics model, and simulation methods to formulate an improvement plan.

Findings

The performance measurement design stage allowed for the identification of balanced, aligned performance indicators, while the system dynamics model illuminated the impact of the system components’ interrelationships on performance output. The problem-solving method allowed for analysis of system performance, identification of constraints and formulation of a performance improvement plan.

Practical implications

This framework can help transport logistics system stakeholders in multiple-role companies avoid silo thinking, misaligned performance objectives, local optima and short-term solutions.

Originality/value

This study contributes to the existing body of research by introducing a novel framework integrating performance measurement, system dynamics and the problem-solving method. It also addresses a theoretical gap by showing how interconnecting components of sea transportation systems affect transport logistics performance.

Integrating system dynamics and VoFI for the dynamic visualization of financial implications arising from IT and IS investments

Purpose

Despite the advantages that the VoFI approach offers compared with traditional capital budgeting methods, its application for the appraisal of information technology (IT) and information systems (IS) investments in both research and practice is not widespread to date. Given the static nature of the generic VoFI table, the method reaches its limits in its financial plan form because it is unable to investigate the dynamic behaviour of complex investment calculations. To date, there has been no attempt to address these shortcomings to advance the use of VoFI as a useful and valid capital budgeting method in finance and accounting. Therefore, the purpose of this study is to address this research gap and aim at developing a ‘dynamic’ VoFI model that integrates all input variables and target measures of a VoFI table and visualises the causal relationships among these variables.

Design/methodology/approach

The ‘dynamic’ VoFI model is developed through System Dynamics (SD) modelling to enhance the strength of the VoFI concept as an instrument for visualising the financial implications of investments in IT and IS at the corporate level. Case study research is used as a research method to study the behaviour of the developed model. The validity of the model is demonstrated by conducting simulation runs in Vensim software. In addition, probabilistic sensitivity analyses are performed to account for the impact of uncertainty on the main model variables.

Findings

The results demonstrate the usefulness of SD modelling for extending the generic VoFI concept by integrating risk analyses and providing a new strategy of data analysis and data presentation different from the typical financial plan form. Furthermore, the dynamic VoFI model enables the visualisation of interdependencies among the various variables incorporated in the VoFI financial plan, which significantly enhances the conceptual understanding of the investment and its financial consequences.

Originality/value

The integration of the VoFI concept into an SD model helps researchers and practitioners to enhance their conceptual understanding of this method. This thus increases its acceptance and popularity as a practical capital budgeting method, especially for the financial assessment of IT and IS investments. The VoFI model proposed in this paper should also enable analysts and decision makers to become more conscious of the interdependencies between the assumptions made for an appraisal and the quantitative results.

Scenario analysis and disaster preparedness for port and maritime logistics risk management

System Dynamics (SD) modelling is used to investigate the impacts of policy interventions on industry actors' preparedness to mitigate risks and to recover from disruptions along the maritime logistics and supply chain network. The model suggests a bi-directional relation between regulation and industry actors' behaviour towards Disaster Preparedness (DP) in maritime logistics networks. The model also showed that the level of DP is highly contingent on forecast accuracy, technology change, attitude to risk prevention, port activities, and port environment.

Predicting performance – a dynamic capability view

Purpose

Production planning and resource allocation are ongoing issues that organisations face on a day-to-day basis. The purpose of this paper is to address these issues by developing a dynamic performance measurement system (DPMS) to effectively re-deploy manufacturing resources, thus enhancing the decision-making process in optimising performance output. The study also explores the development of dynamic capabilities through exploitation of the organisational tacit knowledge.

Design/methodology/approach

The study was conducted using six-stage action research for developing DPMS with real-time control of independent variables on the production lines to study the impact. The DPMS was developed using a hybrid approach of discrete event simulation and system dynamics by using the historical as well as live data from the action case organisation.

Findings

Through the development of DPMS and by combining the explicit and tacit knowledge, this study demonstrated an understanding of using cause and effect analysis in manufacturing systems to predict performance. Such a DPMS creates agility in decision making and significantly enhances the decision-making process under uncertainty. The research also explored how the resources can be developed and maintained into dynamic capabilities to sustain competitive advantage.

Research limitations/implications

The present study provides a starting-point for further research in other manufacturing organisations to generalise findings.

Originality/value

The originality of the DPMS model comes from the approach used to build the cause and effect analysis by exploiting the tacit knowledge and making it dynamic by adding modelling capabilities. Originality also comes from the hybrid approach used in developing the DPMS.

Supply chain performance measures and metrics: a bibliometric study

Purpose

The purpose of this paper is to review the existing literature on supply chain performance measures and metrics (PMMs). It provides a critical evaluation of 234 articles published in past 24 years.

Design/methodology/approach

The paper examines the studies published from 1991 to 2014 by adopting the bibliometric technique of citation and co-citation analysis.

Findings

The analysis of the results indicate that the number of articles on supply chain PMMs is increasing at its fastest pace in the past few years. Furthermore, the study identifies some of the most influential articles on performance measurement and metrics. Finally, it concludes that there has been a transition from traditional to more sophisticated performance measurement system.

Research limitations/implications

This study focuses only on supply chain performance measurement and metrics and excludes research on performance management and control. Thus, researchers may explore and extend this area of research.

Originality/value

To the knowledge of the authors, this is the first study to review the literature on supply chain PMMs by using citation and co-citation analysis. The study includes 234 articles over the time of 24 years (1991-2014).

Health, safety and environmental unit performance assessment model under uncertainty (case study: steel industry)

Performance assessment is a critical objective of management systems. As a result of the non-deterministic and qualitative nature of performance indicators, assessments are likely to be influenced by evaluators' personal judgments. Furthermore, in developing countries, performance assessments by the Health, Safety and Environment (HSE) department are based solely on the number of accidents. A questionnaire is used to conduct the study in one of the largest steel production companies in Iran. With respect to health, safety, and environment, the results revealed that control of disease, fire hazards, and air pollution are of paramount importance, with coefficients of 0.057, 0.062, and 0.054, respectively. Furthermore, health and environment indicators were found to be the most common causes of poor performance. Finally, it was shown that HSE management systems can affect the majority of performance safety indicators in the short run, whereas health and environment indicators require longer periods of time. The objective of this study is to present an HSE-MS unit performance assessment model in steel industries. Moreover, we seek to answer the following question: what are the factors that affect HSE unit system in the steel industry? Also, for each factor, the extent of impact on the performance of the HSE management system in the organization is determined.

USING MULTIPLE CRITERIA DECISION ANALYSIS (MCDA) TO ASSIST IN ESTIMATING RESIDENTIAL HOUSING VALUES

Considerable literature exists regarding the complexity of the residential real estate appraisal process and the methods employed to determine initial listing prices as estimates of intrinsic market prices. Deviations in residential real estate intrinsic values occur due to a multiplicity of attributes and explanatory factors requiring consideration. We conduct a panel study using a Multiple Criteria Decision Analysis (MCDA) based framework that utilizes the skills and knowledge of a panel of residential real estate professionals (i.e. appraisers and realtors). We demonstrate how cognitive mapping and the Measuring Attractiveness by a Categorical Based Evaluation Technique (MACBETH) may assist in estimating appropriate offer/sale prices and strengthening current valuation approaches such as using comparables and/or hedonic modeling. The managerial implications of our MCDA-based framework and some avenues for future research are also presented.

SETTING RENTS IN RESIDENTIAL REAL ESTATE: A METHODOLOGICAL PROPOSAL USING MULTIPLE CRITERIA DECISION ANALYSIS

The real estate sector has been negatively affected by the recent economic recession, which has forced structural changes that impact property value and price. Recent pressures have also motivated reduced liquidity and access to credit, causing a drop in property sales and, thus, boosting the rental housing market. It is worth noting, however, that the rental housing segment is not with-out difficulties and complexity, namely in terms of legislation and rental value revaluation. In light of this reasoning, this study aims to develop a multiple criteria decision support system for calculation of residential rents. By integrating cognitive maps and the measuring attractiveness by a categorical based evaluation technique (MACBETH), we also aim to introduce simplicity and transparency in the decision making framework. The practical implications, advantages and shortfalls of our proposal are also analyzed.

A MULTIPLE CRITERIA FRAMEWORK TO EVALUATE BANK BRANCH POTENTIAL ATTRACTIVENESS

Remarkable progress has occurred over the years in the performance evaluation of bank branches. Even though financial measures are usually considered the most important in assessing branch viability, we posit that insufficient attention has been given to other factors that affect the branches’ potential profitability and attractiveness, such as: location features, trade area characteristics and facilities management. Based on the integrated use of cognitive maps and multiple criteria decision analysis, we propose a framework that adds value to the way that potential attractiveness criteria to assess bank branches are selected and to the way that the trade-offs among those criteria are obtained. This framework is the result of a process involving several directors from the five largest banks operating in Portugal, and follows a constructivist approach. Our findings suggest that the use of cognitive maps systematically identifies previously omitted criteria that may assess potential attractiveness. The use of multiple criteria techniques clarify and add transparency to the way trade-offs are dealt with. Advantages and disadvantages of the proposed framework are also discussed.