Executing strategy through comprehensive performance measurement systems

The association between the interactive and diagnostic use of financial and non-financial performance measures with individual creativity: The mediating role of perceived fairness

This study examines the associations between top management’s interactive and diagnostic use of financial and non-financial performance measures with individual manager’s (i.e. middle and lower level managers) creativity, and the mediating role of middle and lower level manager’s perceived fairness of their performance appraisal on such associations. Using data from a survey of 220 middle and lower level managers from manufacturing organisations in Australia, the structural equation model revealed direct positive associations between both the diagnostic use of financial performance measures and the interactive use of non-financial performance measures with individual creativity. Further, the positive effect of the interactive use of financial performance measures on individual creativity is positively and fully mediated by distributive, interpersonal and informational fairness, while the positive effect of the interactive use of non-financial measures is positively and partially mediated by interpersonal and informational fairness. In addition, procedural fairness positively and partially mediates the effect of the diagnostic use of financial performance measures on individual creativity, and interpersonal fairness positively and fully mediates the effect of the diagnostic use of non-financial performance measures on individual creativity. The findings contribute to the performance measurement and appraisal literature examining the interactive and diagnostic use of both financial and non-financial performance measures and extends the sparse literature on the role of perceived fairness in explaining the behavioural effect of performance measurement systems. The findings also provide implications for practice, revealing the importance of the interactive and diagnostic use of financial and non-financial performance measures, and manager’s perception of the fairness of performance appraisal processes as a mechanism through which individual manager’s creativity can be enhanced.

Performance measurement and management systems for dealing with strategies in uncertain ecosystems

Purpose

Although there is a growing research stream on Performance Measurement and Management Systems (PMMS) in Ecosystems literature, current research offers limited theoretical insights into how PMMS deal with two types of strategies in uncertain ecosystems: ecosystem-based strategy – EBS (at the focal firm level) and ecosystem strategy – ES (at the ecosystem level). This study aims at identifying how PMMS are employed to deal with different types of strategies in uncertain ecosystems.

Design/methodology/approach

The authors employed an inductive, rich multiple case approach in five focal firms with platform ecosystems. Data collection involved multiple sources of information (primary and secondary data), combing retrospective and longitudinal perspectives. Data analysis combined replication and comparison logic with coding.

Findings

This study identifies four major distinctive dimensions of Ecosystem PMMS under uncertainty: (1) Integrative Performance (considering the different ecosystem actors’ performance), (2) Interdependence Performance (mutual, yet not necessarily convergent amongst ecosystem partners), (3) Regulative Performance (paradoxical in nature, having to cope with both flexibility and stability) and finally (4) Phased Learning Performance (non-linear).

Research limitations/implications

Our primary contribution is a new framework for PMMS literature: a performance measurement and management system for dealing with strategies in ecosystems. This framework enables managing performance regarding both types of strategies (EBS and ES) and their interplay in uncertain ecosystems.

Practical implications

The ecosystem management requires focal firms to measure and manage the overall ecosystem’s performance, and it varies according to the type of strategy adopted in each case. Our framework provides dimensions that guide firms to build and implement PMMS for an ecosystem consistent with the ES. Therefore, it may improve performance, especially in uncertain business contexts.

Originality/value

The findings enrich PMMS literature in an ecosystem context related to the ES in uncertain environments.

Organizing for permanent beta: performance measurement before vs performance monitoring after release of digital services

Purpose

Due to the complexity of digital services, companies are increasingly forced to offer their services “in permanent beta”, requiring continuous fine-tuning and updating. Complexity makes it extremely difficult to predict when and where the next service disruption will occur. The authors examine what this means for performance measurement in digital service supply chains.

Design/methodology/approach

The authors use a mixed-method research design that combines a longitudinal case study of a European digital TV service provider and a system dynamics simulation analysis of that service provider's digital service supply chain.

Findings

With increased levels of complexity, traditional performance measurement methods, focused on detection of software bugs before release, become fragile or futile. The authors find that monitoring the performance of the service after release, with fast mitigation when service incidents are discovered, appears to be superior. This involves organizational change when traditional methods, like quality assurance, become less important.

Research limitations/implications

The performance of digital services needs to be monitored by combining automated data collection about the status of the service with data interpretation using human expertise. Investing in human expertise is equally important as investing in automated processes.

Originality/value

The authors draw on unique empirical data collected from a digital service provider's struggle with performance measurement of its service over a period of nine years. The authors use simulations to show the impact of complexity on staff allocation.

Key Performance Indicators Selection through an Analytic Network Process Model for Tooling and Die Industry

In the last few decades, the fast technological development has caused high competitiveness among companies, encouraging a pursuit for strategies that allow them to gain competitive advantage, such as the monitoring of performance by using key performance indicators (KPIs). However, its selection process is complex since there are several KPIs available to evaluate performance and different relationships between them. To overcome this challenge, the use of a multiple criteria decision-making model (MCDM) was proposed, namely the analytic network process (ANP) through which a reduced number of them are prioritized. To identify which KPIs are suitable for the press cast and die manufacturing industry, a literature review was made, and 58 unique KPIs were identified. Thus, to validate the proposed methodology, a case study was carried out in an automotive press molding industry. With the implementation of the proposed ANP model it was possible to identify 9 KPIs that ensure the correct molding process monitoring, while being aligned with the Balanced Scorecard criteria. The results show that the proposed model is suitable for selecting KPIs for the molding industry.

The complementarities of big data and intellectual capital on sustainable value creation; collective intelligence approach

It is evident in the literature that both intellectual capital and big data analytics create value to the organizations independently, but how threats, opportunities, capabilities and value creation for intellectual capital change with big data adoption is largely unexplored. This paper aims to develop an analytical framework for identifying challenges, opportunities, capabilities and value creation in the face of complementarity between big data and components of intellectual capital. The paper uses a Collective Intelligence approach as a theoretical background. Based on Structured Literature Review, the current study has developed an analytical framework for organizations to be used as a decision-making tool while making investment in big data and managing intellectual capital. Findings suggest that the scope of human capital has changed largely as now employees are expected much more than in the past with strong analytical, dynamic, technical and IT capabilities. Structural capital calls for new practices, routines and procedures to be adopted and old methods to unlearn whereas relational capital stresses the importance of network building and social media to create sustainable value for the society.

The role of performance measurement in aligning operations with strategy: sustaining cognitive processes of internal alignment

Purpose

This paper aims to address an important theoretical shortcoming in the conceptualization of internal alignment by investigating the cognitive processes involved in aligning operations with strategy and the role of performance measurement (PM) in sustaining these processes.

Design/methodology/approach

A theory-building study investigates the process of using PM to drive the implementation of a new strategy in a large beer manufacturer in Italy. The study uses a sensemaking perspective to theorize the findings. Data were collected through semi-structured interviews, field observations and company documents.

Findings

This study develops a theoretical model suggesting that establishing and maintaining internal alignment occurs through seeking, assembling, adjusting and finalizing the meaning of how strategic priorities inform local action. PM plays a central role in this process by providing interpretive support.

Research limitations/implications

This article advances a cognition-centred view of internal alignment that complements the behavioural aspect of the phenomenon emphasized in prior literature.

Practical implications

Using PM for aligning operations with strategy is a complex and iterative process that requires time and effort and generates temporary stability. Managers may need to complement traditional approaches to alignment with providing space for sensemaking.

Originality/value

The paper proposes a view of internal alignment as an ongoing interpretive process that is sustained by PM. This process brings about the consistency of meanings that generates strategy-consistent behaviours.

The roles of performance measurement and management in the development and implementation of business ecosystem strategies

Purpose

Performance measurement and management (PMM) systems have traditionally enabled strategy execution within and across firms. However, PMM have been criticized as overly static and deterministic and therefore inappropriate for emergent and dynamic contexts, such as those that characterize business ecosystems.The study aims to address the roles of organizational PMM practices in the development and implementation of business ecosystem strategies.

Design/methodology/approach

The authors carried out a qualitative, longitudinal study during 2016–2020 at a Japanese multinational technology corporation attempting to create an ecosystem strategy to expand its market and diversify its offering. The authors collected interview, observation and archival data, spanning the period from framing the initial strategy to establishing the ecosystem.

Findings

The process of developing and implementing the ecosystem strategy was emergent and highly iterative, rather than planned and linear, eventually requiring key decision-makers in the company to challenge some of their deeply held assumptions. PMM practices first acted as barriers to ecosystem development by promoting an excessive focus on revenue generation. Once modified, PMM helped capture, convey and reassess the ecosystem strategy. Performance targets, indicators and strategy maps were not just data gathering and reporting mechanisms but key means to express competing perspectives.

Practical implications

When developing an ecosystem strategy, managers should adopt a participatory and iterative approach, reviewing the complementary effects of various PMM tools at different points in time.

Originality/value

The study is among the first to provide an in-depth account of ecosystem strategy creation and implementation and to identify the diverse roles and effects of PMM practices in dynamic and complex contexts.

The effects of performance measurement system uses on organizational ambidexterity and firm performance

Purpose

This study aims to investigate how dynamic tensions between performance measurement system (PMS) uses enable organizations to achieve both exploitation and exploration and enhance firm performance.

Design/methodology/approach

The authors collected survey data on 153 Italian companies. Scales for each construct were validated through an exploratory factor analysis. Data on firm performance were cross-validated by using lagged accounting data. The authors tested our hypotheses using hierarchical ordinary least squares regressions, together with bootstrapping procedures for the test on mediation.

Findings

A diagnostic use of PMS has a positive association with both exploitation – e.g. reductions in total costs and lead times – and exploration, e.g. introduction of new products and extension of product ranges. The dynamic tension created by a joint diagnostic and interactive use has the strongest association with organizational ambidexterity, measured as the multiplicative interaction between exploration and exploitation.

Practical implications

If an organization or business unit is mainly pursuing exploitative goals, a mainly diagnostic use of PMS would be most suitable. If goals are both exploitative and explorative, a mix of diagnostic and interactive uses would be most effective.

Originality/value

This research helps reconcile conflicting views in the literature. The diagnostic use of PMS, far from acting as a “negative force,” appears to be necessary to guide opportunity search and to establish an appropriate scope for exploration-related activities. The authors’ focus on the uses of PMSs shows that ambidexterity is achieved through managerial capability, rather than just through the introduction of systems and structures.

Measuring coherence of performance measurement indicators in complex and changing environments

Purpose

This paper discusses and integrates the concept of complexity in the performance measurement and management (PMM) theory by providing a comprehensive framework to design and evaluate the overall coherence alignment of an indicators hierarchy in unstable and changing environment.

Design/methodology/approach

An original, comprehensive and dynamic framework has been proposed and then applied on a sample case of a large-scale retail trade (LSRT) company, starting from relevant frameworks and criteria in the scientific literature.

Findings

This research shows that organizational changes may significantly impact the coherence alignment of an organization's indicators hierarchy. In addition, it finds that even though the alignment at the operational level is obtained, its effectiveness should be evaluated in relation to the organization's strategic orientation. Indeed, without assessing the strategic alignment of an indicators system, an aligned hierarchy at the operational level could lead to ineffective results.

Research limitations/implications

This paper focuses on the topic of measuring the coherence inside an indicators hierarchy, which seems not to be addressed in the literature. Thus, it opens a new research stream, integrating the studies on performance indicators with an essential element that often causes flawed performance measures in organizations.

Practical implications

Organizations could adopt this framework to design effective PMM systems and maintain them in light of the organizational changes.

Originality/value

This study introduces different metrics to evaluate the coherence and alignment of an indicators system, being one of the few research studies to address this topic in the context of complex and changing environments.

The purposes of performance management systems and processes: a cross-functional typology

Purpose

This paper aims to organise, in a general typology, the different purposes of performance management systems and processes (PMSPs) that are discussed across the performance management literature in different functional areas.

Design/methodology/approach

The typology is developed based on a traditional review of the performance management literature from three types of functional areas, represented by operations and production management, management accounting and human resource management.

Findings

The cross-functional typology illustrates how the different types of purposes discussed in the literature can be organised in a hierarchical structure. In this way, the basic purpose of organisational value creation for PMSPs can be decomposed into two layers of sub-purposes, the first specifying the domain and the second outlining the specific managerial use of PMSPs.

Practical implications

The presented typology may help managers across different functional areas map the purposes of their PMSPs; this mapping will not only provide the basics for understanding a PMSP's potential value for an organisation but also serve as an important input for PMSP design.

Originality/value

The presented typology has a broader scope than existing typologies of purposes in research and, consequently, better interrelates and tracks the various types of purposes discussed across different functional areas. This contributes not only to our understanding of performance management as a cross-functional field but also to research on the use and design of PMSPs in organisations.

Organisational performance and the use of multiple performance measures in an emerging market

Purpose

This study is an empirical investigation of the relationship between the use of 41 multiple performance measures (MPMs), including financial performance measures (FPM), non-financial performance measures (NFPMs) and organisational performance (OP) in Libya.

Design/methodology/approach

The results are based on cross-sectional questionnaire survey data from 132 Libyan companies (response rate 61%), which were obtained just before the so-called Arab Spring.

Findings

MPMs are used by both manufacturing and non-manufacturing companies. Libyan business organisations are more likely to use FPMs than NFPMs. However, these companies still rely more heavily on FPMs. The relationships between the use of NFPMs and OP and the use of MPMs and OP are positive and highly significant. The relationship between the use of FPMs and OP is positive but not significant.

Research limitations/implications

The high power distance associated with the conservative, Libyan, Arab context will reinforce the tendency to use FPMs more than NFPMs. This may provide a performance advantage to those organisations which do adopt NFPMs.

Practical implications

Although there may be institutional barriers to the use of NFPMs in Libya, and other emerging markets, these are not insuperable and there is a payoff to their use.

Originality/value

No previous studies of emerging markets, such as the Middle East or North Africa, have looked at the relationship between OP and the adoption of such a large array of MPMs.

Knowledge assets, capabilities and performance measurement systems: a resource orchestration theory approach

Purpose

The pivotal role of knowledge management (KM) and its extensive implications have been debated in the academic literature with insufficient focus on its link to particular organizational control mechanisms such as performance measurement systems (PMS). To bridge this gap and building on resource orchestration theory, this paper aims to investigate the relationships between KM factors, PMS and corporate performance.

Design/methodology/approach

Based on a survey data set of 92 listed companies in Iran, the framework and hypotheses were tested using structural equation modeling (SEM) based on partial least squares (PLS).

Findings

The SEM-PLS results indicate that knowledge assets are significantly associated with both PMS and corporate performance while knowledge process capabilities (KPC) are not significantly associated with PMS and corporate performance. This study also shows that PMS mediates the relationship between knowledge assets and corporate performance.

Practical implications

The results suggest that the use of appropriate management control systems plays an effective role in synchronizing, aligning and orchestrating a company’s various knowledge resources, which, in turn, can lead to superior overall performance.

Originality/value

Building on a unique synthesis of resource orchestration theory and the knowledge-based view of the firm, the results of this study provide the first empirical evidence on how PMS intervenes in the relationship between knowledge resources (knowledge assets and KPC) and corporate performance.

The Role of Corporate Culture in Performance Measurement and Management Systems

Recently, there has been increasing pressure to change current performance measurement and management systems from control systems to those that support learning and continuous improvement. This change requires a specific corporate culture that supports the effective operation of performance measurement and management. This paper aims to clarify the relationship between corporate culture and performance measurement and management systems. Questionnaire survey data from Czech medium and large companies were collected and analyzed by Pearson’s chi-squared test to validate the proposed hypothesis. The research findings confirmed that performance measurement and management systems of companies that devoted sufficient energy and attention to performance-driven culture are more effectively developed. Analysis of different performance-driven culture attributes revealed which are the most important ones.

Does PMS influence the strategy pillars: OPP relationship? Evidence from HEIs in Indonesia

Purpose

This study aims to investigate whether strategy pillars have a positive direct effect on organizational productivity performance (OPP) in the Indonesian HEI (Higher Education Institutions) research setting and, if so, whether the effect is mediated by a performance management system (PMS).

Design/methodology/approach

This study used quantitative research employing partial least square structural equation modeling (PLS-SEM) to test the hypotheses. A mediation model of the research framework was developed to investigate the mediating role of PMS.

Findings

Using a sample of 182 Indonesian HEI managers, the results indicate that strategy pillars have a positive effect on OPP. Further analysis shows that PMS partially mediates the strategy pillar–OPP relationship.

Research limitations/implications

This study has limitations. Firstly, the sample size used was relatively small and this may raise the issue of generalization. Secondly, it used a Likert scale and therefore may raise the issue of judgment bias. Lastly, this study is context-specific for Indonesia and caution should be used when generalizing it to other countries.

Practical implications

To enhance the HEIs productivity performance, the HEI managers should develop strong strategy pillars for the purpose of effective strategy formulation and execution.

Social implications

This study provides a model showing how to improve the HEIs productivity performance by employing strategy pillars and a PMS. The better the performance of the HEIs, the better the quality of life of society in the era of the knowledge economy.

Originality/value

Strategy pillars have rarely been researched. This study is therefore one of the few studies on strategy pillars. This study also provides new elements related to measuring strategy pillars, PMS and OPP in the context of HEIs in Indonesia as an emerging economy.

Performance measurement and management in the public sector: state of the art and research opportunities

Purpose

Since the 1980s, performance measurement and management (PMM) has been described as an essential element of new public management (NPM) reforms. The purpose of this paper is to provide an overview of the current state of the art and future research opportunities for PMM in public sector management.

Design/methodology/approach

The paper carried out a bibliometric literature review using two main techniques named (1) performance analysis and (2) science mapping techniques. It investigated the academic research area describing the main publications' trend, the conceptual structure and its evolution from 1996 to 2019.

Findings

The results highlighted the growing relevance of PMM research in public organisations and confirmed a great interest of the business, management and accounting literature on PMM in public sector management. Furthermore, the results also described a conceptual structure of the public PMM literature analysed and its evolution being too generic to answer public organisations' needs. The results identified five main research gaps and research opportunities.

Originality/value

Although the adoption of rigorous bibliometric techniques was recognised as being useful for assessing the academic research study, the paper describes the business, management and accounting literature contributing to new theoretical and practical future opportunities.

Exploratory study

Purpose

Employee engagement recently emerged as a promising mechanism to improve organisational effectiveness and accordingly reduce the performance gap. This paper empirically demonstrates which employee engagement dimension(s) act as the strongest dimension to enhance the levels of employee engagement and consequently organisational effectiveness.

Design/methodology/approach

This study used a quantitative approach, specifically a survey design, using a questionnaire to collect data. Regression analysis was applied to predict the impact of the employee engagement dimensions on the level of employee engagement in organisations and the impact of online/social media, as part of communication, on employee engagement.

Findings

The statistical analyses indicate that the dimensions organisational strategy and implementation, organisational commitment and team commitment are significant predictors of employee engagement. On-line/social media has a negative effect on employee engagement. However, according to the results, communication in organisations can be improved, especially by using online/social media more effectively.

Research limitations/implications

This includes low response rate from some groups.

Practical implications

The importance of secondary general management tasks, particularly motivation and communication, in mobilising employees to cooperate in pursuing organisational goals, became apparent. This study reflects the adverse effect of a lack of leadership and management skills, and ineffective use of online/social media on organisational performance, as reported in academic and practitioner research. Regardless, practitioners can apply the levers of motivation, via structural dimensions of organisation, to activate psychological presence which drives employee engagement and in turn facilitates strategy implementation and consequently organisational effectiveness. Scholars can modify their research agendas by investigating the “(un)availability” of human resources to improve organisational effectiveness.

Social implications

The costs of disengaged employees are high, in terms of productivity losses and the performance gap, with adverse consequences for society.

Originality/value

Employee engagement as a driver of strategy implementation is an overlooked area of research. This study offers a better explanation of employee engagement as a mechanism to improve strategy implementation, thus reducing the performance gap, and consequently waste. Employee engagement engenders employee support to pursue organisational goals, in a coordinated system of cooperation, and is produced by the structural dimensions of organisation, the parameters within which psychological presence is activated. Psychological presence drives employee engagement which enables employees to be available to implement strategy to achieve organisational goals and thus organisational effectiveness. Engagement at a broader level than individual is significant.

The moderating role of 360-degree appraisal between engagement and innovative behaviors

Purpose

Engaged employees are a critical asset in any business. This is largely because engaged employees tend to proffer innovative solutions to complex problems in the workplace. The purpose of this paper is to examine the relationship between engagement and innovation as moderated by the use of 360-degree evaluation.

Design/methodology/approach

A survey targeting employees in Lebanon solicited their perceptions of 360-degree evaluation, engagement and innovative behaviors along with a statement as to whether their firm used 360-degree evaluations or not. Structural equation modeling (SEM) was used to test the moderating effect of 360-degree evaluations on the latent variables of engagement and three facets of innovation.

Findings

SEM results show that 360-degree evaluations serve to enhance engaged employees’ innovative work behavior. However, ideation (creation and implementation) behaviors are more strongly influenced by the presence of 360-degree evaluation as compared to their “tangible” counterpart (technology and financial resource use).

Research limitations/implications

Respondents selected for this research were randomly sampled employees in Lebanon. A stronger study strategy would be to study paired departments within organizations – one implementing 360-degree evaluation and another not implementing it.

Practical implications

Managers, seeking to engender and strengthen innovative behaviors in engaged employees, should utilize 360-degree evaluation processes. Furthermore, the 360-degree evaluations should be designed to probe both tangible (technology and financial resource use) and intangible (idea generation and implementation) facets of innovation.

Originality/value

This study yields a deeper understanding of the relationship between engagement and innovative behaviors in the workplace along with managerial insights into the design and use of 360-degree evaluation.

Translating knowledge management into performance

Purpose

This paper aims to tie together insights from the body of research on knowledge management (KM) and management accounting control systems to propose a conceptual model in which performance measurement systems (PMS) can play a role in translating knowledge resources into enhanced performance.

Design/methodology/approach

The underlying assumption of the “fit-as-mediation” approach signifies that knowledge features can play a role in the determination of the structure and implementation of particular managerial processes and this, in turn, may support information processing and lead to desirable results within organizations.

Findings

Synthesizing theory from performance measurement and the knowledge-based view of the firm, the paper’s analysis and discussions elucidate how the implementation of an overarching PMS, i.e. diversity of measurement, could translate the knowledge-related factors, i.e. knowledge resources and knowledge process capabilities, into enhanced performance. In particular, the proposed model shows that a comprehensive PMS plays an intervening role between KM and organizational performance.

Research limitations/implications

The proposed model may inspire a new research agenda to show how knowledge initiatives are managed and measured in organizations and how they are properly aligned with specific managerial processes to deliver real value.

Practical implications

Drawing upon the conceptualized associations among KM, PMS and organizational performance, this paper recommends some practical guidelines by highlighting the importance of PMS whereby organizations may reap maximum benefit from their KM initiatives.

Originality/value

This paper sheds new light on the links between KM and organizational performance, and it appears to be the first study to propose an intervening effect of PMS between KM and organizational performance.

Employee engagement: Driving strategy implementation through dimensions of organisation

Research worldwide reports low levels of employee engagement reflecting employee well-being. This observation spells dire consequences for enterprise performance, expressed as goal achievement, and attained via strategy. Strategy implementation failure adds to enterprise performance pressures, while reducing employee well-being. Research investigating employee engagement as driver of strategy implementation through dimensions of organisation is limited. This paper conceptually examines how employee engagement can be enhanced while driving strategy implementation through dimensions of organisation. The Nienaber and Martins (2015, Journal of Contemporary Management, 12(1), 401–425) survey results serve as illustration. The conclusions arrived at here show that all six factors – at individual, team/unit, and enterprise levels – can be classified according to the dimensions of organisation. Moreover, the dimensions of organisation are not necessarily mutually exclusive, but rather interrelated, and influence employee engagement in unexpected ways. The contribution of this paper stems from the promise that dimensions of organisation serve as mechanism to drive strategy implementation via employee engagement.

Comprehensive performance measurement systems design and organizational effectiveness

Purpose

The purpose of this paper is to provide empirical evidence regarding the relationship between the level of comprehensiveness of a performance measurement system (PMS) and its respective organizational effectiveness. The extant literature has highlighted that a PMS may successfully contribute to the implementation of the organizational strategy, with the balanced scorecard (BSC) serving as an exemplar of a strategy performance management tool and playing a primary role to this end. However, the reasons for the overall high rate of failure in the implementation of the BSC remain unexplained and, to date, little empirical research exists regarding the design of PMSs such as the BSC and its constituent elements.

Design/methodology/approach

Using a survey of 103 Italian managers, the paper advances a model describing a comprehensive BSC design, after identifying the key attributes from the performance management literature. Data were analyzed using cluster analysis and multiple regression analysis.

Findings

Results suggest that organizations are implementing the BSC following two different approaches, which vary from a less comprehensive to a more comprehensive design. More importantly, the BSC design explains variation across three organizational effectiveness measures: improvements in translating the organizational strategy into operational goals, understanding cause–effect relationships and enhancing internal communication among employees.

Originality/value

The paper builds on and extends the previous literature on performance management in two ways. First, via a literature review, it introduces a model describing a comprehensive BSC design, which includes 12 attributes. Second, it demonstrates that organizational effectiveness varies positively with the level of comprehensiveness of the BSC design.

Operations flow effectiveness: a systems approach to measuring flow performance

Purpose

Effective operations management systems (OMS) measurement remains a critical issue for theorists and practising managers (Neely, 2005; Bititci et al., 2012). Traditional labor efficiency measures sufficed when all that was made could be sold or when mass production systems filled warehouses with stock and the OMS had little relationship with “the consumer.” Modern manufacturing systems require a different form of flow optimization (beyond labor efficiency) measurement (Schmenner, 2015). The essential unit of measure for all OMS designs is the optimal use of time for process value adding and the flow of materials into and from the conversion process. Timely flow, therefore, satisfies the needs of multiple organizational stakeholders including cash flow (accounting), consumer reaction times (marketing) and the general steady state flow of materials (sales and supply chain). The purpose of this paper is to present the results of testing a new performance measure of operations flow effectiveness (OFE) with ten purposively selected cases.

Design/methodology/approach

The paper is theory building using ten, purposively selected, longitudinal case studies drawn from the UK high-value manufacturing (HVM) sector using a pluralist methodology of interviews, observation and secondary data.

Findings

The OFE measure provides a holistic view of material flow through the input-process-output cycles of a firm. The measure highlights OMS design weaknesses and flow inhibitors that reduce cash flow using a time-based approach to measuring OMS performance. The study validates the OFE measure and has identified six key design elements that enable high flow performance.

Originality/value

The paper tests a new process-focused flow performance measure. The measure supports a holistic approach to the manufacturing enterprise and allows different OMS designs to be evaluated so that organizational learning may be enacted to support performance improvement.

Measuring supply chain performance: a lifecycle framework and a case study

Purpose

The purpose of this paper is to provide a conceptual framework of the supply chain performance measurement system (SCPMS) lifecycle (highlighting key activities of the design, implementation, use and review phases) and to investigate how the different actors involved in the SCPMS perceive the system and can act to allow for an effective adoption.

Design/methodology/approach

The SCPMS lifecycle framework is developed grounding on performance measurement and supply chain (SC) management literature. To answer the two theory-building research questions, an in-depth case study involving seven firms across three tiers of the mass retail SC has been conducted.

Findings

The empirical evidence highlighted potential SCPMS benefits (including operational performance improvement, higher control, lower information overloading and higher SC integration) and criticalities/barriers to an effective adoption (lack of industry standards, lack of trust regarding data reliability, SCPMS as a tool of power, lack of interest in the system and the performance metrics). Several elements characterizing the SCPMS lifecycle could increase its effective adoption: engaging SC partners in the design phase; relying on a rigorous primary data collection and performance measures calculation; and actively exploiting the tool through a systematic discussion on performance and establishing incentive/disincentives plans.

Originality/value

The paper contributes to the conceptualization of SCPMSs and to clarify how to ensure an effective SCPMS adoption: apart from relationship-specific attributes, SCPMS lifecycle phases are suggested to have a key role.

The use of management control and performance measurement systems in SMEs

Purpose

The purpose of this paper is to respond to recent calls for understanding how multiple management control (MC) and performance measurement (PM) systems are used simultaneously for managing performance, particularly in the context of small- and medium-sized enterprises (SMEs).

Design/methodology/approach

Data are collected during an in-depth case study of MC and PM and management practices in a Dutch SME using multiple data sources and elicitation methods, including interviews and participant observations.

Findings

This study identifies managerial practices that enable the interplay of the four control systems – beliefs, boundaries, diagnostic and interactive – helping the organization manage organizational tensions in relation to short- and long-term focus, predictable goal achievement and search for new opportunities, internal and external focus, and control and creativity.

Research limitations/implications

This paper advances the research on integrating multiple aspects of performance management, particularly technical and social. This research is based on a single case study; future qualitative and quantitative studies could explore the interplay between the four control systems in other settings and explore the relationship between control systems and leadership style.

Practical implications

Managing performance requires active and continuous use of all four control systems. This is particularly salient in SMEs where less formal controls play a key role and where balance needs to be ensured despite the lack of managerial processes and capabilities.

Originality/value

The findings advance PM and management theory and practice in the context of SMEs.