Abstract Rooted in contingency theory, this study puts forth propositions stating (1) that superiors of business units which face higher environmental uncertainty will use a more subjective performance appraisal approach whereas superiors of business units which face lower environmental uncertainty will use a more formula-based performance evaluation approach, and (2) that a stronger fit between environmental uncertainty and performance evaluation style would be associated with higher business unit performance. Findings from 58 business units in eight Fortune 500 firms provide strong support to both sets of these propositions.

Appropriateness of accounting data in performance evaluation: an empirical examination of...

Creative Tension in the Innovation Process: How to Support the Right Capabilities

This note follows and extends Abernethy and Lillis (Accounting, Organizations and Society, 1995) by examining: (i) whether firms which maintain a customer-focused manufacturing strategy also maintain an emphasis on non-financial (operations-based) measures in their performance measurement systems; and (ii) whether such an emphasis is associated with enhanced performance for those firms. Data are obtained via questionnaire survey of a random sample of manufacturing firms in Sydney, Australia. Support is found for the hypothesized association between customer-focus strategy and the use of non-financial performance measures (and hence for Abernethy and Lillis) but not for the link to organizational performance.

Customer-focused manufacturing strategy and the use of operations-based non-financial

With increased adoption and resource spent for business performance management, it is interesting to inquire about its practice and performance. Based on the response from CFO's of the 38 leading Indian companies, we found that BPM is satisfying tactical purposes well, but lagged in strategic, top management and learning and development needs. The results compare well with Tonge et al. (2000), Malcolm (2006), Wiersma (2009), etc. When compared with Simmons (1995b) levers of control, we observe better performance on diagnosis and belief control system, while lagged as interactive control tool. Despite increasing use and importance of various non-financial measures, we observed lower satisfaction with its measurement quality and fewer linked those measures to compensation, comparable with Lingle and Schiemann (1996). Our findings are symptomatic of evolution of BPM to overcome the inadequacies of reliance on accounting-based performance measurement (RAPM) to strategic management system and more recently management learning and development tool.

How does business performance measurement perform? An empirical study with reference to leading companies in India

This paper analyzes the interaction among the step-by-step innovation, the product market competition (PMC), and the knowledge information flow in the growth process. Patents protect their holders from being imitated or copied but do not protect them against the possibility that less-efficient competitors master the diffused knowledge. The degree to which diffused knowledge should be exploited by less-efficient firms is determined by both their knowledge assimilating capacities and Research and Development (RD second, the more the flexibility on individual creativity in RD third, the knowledge information flow has a polarization effect on firms' innovative performance.

R&D Team's Competencies, Innovation, and Growth With Knowledge Information Flow

textThis study investigates the extent to which Dutch organizations use ‘new’ performance measures to deal with the perceived inadequacies of traditional accounting performance measures. In addition, the determinants of the use of these ‘new’ performance measures are documented; finally, the alignment hypothesis is tested. Using survey data from Dutch firms, I find that non-financial measures appear to be used most often in addition to more traditional performance measures; economic value measures and subjective measures appear to be used to a lesser extent. Second, the results indicate that the importance of the shareholder value goal and size are positively related to the use of economic value measures. The importance of the shareholder value goal, a growth mission, task culture and size are all positively associated with the use of non-financial measures. The (relative) use of subjective measures is negatively related to size. Finally, I find no support for the alignment hypothesis that a mismatch between the firm’s strategic and contextual characteristics and its performance measurement system adversely affect performance.

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New’ Performance Measures: Determinants of Their Use and Their Impact on Performance

This study investigates the extent to which Dutch organizations use ‘new’ performance measures to deal with the perceived inadequacies of traditional accounting performance measures. In addition, the determinants of the use of these ‘new’ performance measures are documented; finally, the alignment hypothesis is tested. Using survey data from Dutch firms, I find that non-financial measures appear to be used most often in addition to more traditional performance measures; economic value measures and subjective measures appear to be used to a lesser extent. Second, the results indicate that the importance of the shareholder value goal and size are positively related to the use of economic value measures. The importance of the shareholder value goal, a growth mission, task culture and size are all positively associated with the use of non-financial measures. The (relative) use of subjective measures is negatively related to size. Finally, I find no support for the alignment hypothesis that a mismatch between the firm’s strategic and contextual characteristics and its performance measurement system adversely affect performance.

Frank H. M. Verbeeten

Papers

New’ Performance Measures: Determinants of Their Use and Their Impact on Performance

New’ Performance Measures: Determinants of Their Use and Their Impact on Performance