The effect of performance measurement systems on firm performance: A cross-sectional and a longitudinal study

Journal of Operations Management

Volumn 32, Issue 6, 2014, Pages 313-336

  Koufteros, Xenophon ^a   Verghese, Anto ^a   Lucianetti, Lorenzo ^b  

^a TEXAS A AND M UNIVERSITY   (United States)

^b UNIVERSITY OF CHIETI   (Italy)

Author keywords

Accounting; Empirical; Financial performance; Operations management; Panel data; Performance Measurement Systems

Indexed keywords

COMPETITION; COMPUTER SUPPORTED COOPERATIVE WORK; NUCLEAR FUEL ACCOUNTING; FINANCE; INFORMATION MANAGEMENT;

EMPIRICAL; FINANCIAL PERFORMANCE; OPERATIONS MANAGEMENT; PANEL DATA; PERFORMANCE MEASUREMENT SYSTEM; ACCOUNTING; OPERATION MANAGEMENT; ORGANIZATIONAL PERFORMANCE; PERFORMANCE; SYSTEM; SYSTEM USE;

GRAPHICAL USER INTERFACES; COMPETITION;

EID: 84905594762     PISSN: 02726963     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.jom.2014.06.003     Document Type: Article

References (106)

1. B.R. Agle, R.K. Mitchell, and J.A. Sonnenfeld What matters to CEOs? An investigation of stakeholder attributes and salience, corporate performance and CEO values Acad. Manage. J. 42 5 1999 507 525
2. H. Ahn Applying the balanced scorecard concept: an experience report Long Range Plann. 34 4 2001 441 461 (Pubitemid 33023884)
3. T. Ahrens, and C.S. Chapman Accounting for flexibility and efficiency: a field study of management control systems in a restaurant chain Contemp. Account. Res. 21 2 2004 271 301 (Pubitemid 38835085)
4. R. Amit, and P.J. Schoemaker Strategic assets and organizational rent Strategic Manage. J. 14 1 1993 33 46
5. A. Baldauf, H. Reisinger, and W.C. Moncrief Examining motivations to refuse in industrial mail surveys J. Market Res. Soc. 41 3 1999 345 353
6. M.J. Benner, and F.M. Veloso ISO 9000 practices and financial performance: a technology coherence perspective J. Oper. Manage. 26 5 2008 611 629
7. S.L. Berman, A.C. Wicks, S. Kotha, and T.M. Jones Does stakeholder orientation matter? The relationship between stakeholder management models and firm financial performance Acad. Manage. J. 42 5 1999 488 506
8. J.G. Birnberg, L. Turopolec, and S.M. Young The organizational context of accounting Account. Org. Soc. 8 2 1983 111 129
9. J. Bisbe, J.M. Batista-Foguet, and R. Chenhall Defining management accounting constructs: a methodological note on the risks of conceptual misspecification Account. Org. Soc. 32 7 2007 789 820
10. J. Bisbe, and R. Malagueño Using strategic performance measurement systems for strategy formulation: does it work in dynamic environments? Manage. Account. Res. 23 4 2012 296 311
11. J. Bisbe, and D. Otley The effects of the interactive use of management control systems on product innovation Account. Org. Soci. 29 8 2004 709 737 (Pubitemid 39159524)
12. U.S. Bititci, A.S. Carrie, and L. McDevitt Integrated performance measurement systems: a development guide Int. J. Oper. Prod. Manage. 17 5 1997 522 534 (Pubitemid 39032369)
13. U.S. Bititci, and T. Turner Dynamics of performance measurement systems Int. J. Oper. Prod. Manage. 20 6 2000 692 704 (Pubitemid 39032241)
14. M. Bourne, J. Mills, M. Wilcox, A. Neely, and K. Platts Designing, implementing and updating performance measurement systems Int. J. Oper. Prod. Manage. 20 7 2000 754 771 (Pubitemid 39032231)
15. M. Bourne, A. Pavlov, M. Franco, L. Lucianetti, and M. Mura Generating organisational performance: the contributing effects of performance measurement and human resource management practices Int. J. Oper. Prod. Manage. 33 11/12 2013 1599 1622
16. G.J. Braam, and E.J. Nijssen Performance effects of using the balanced scorecard: a note on the Dutch experience Long Range Plann. 37 4 2004 335 349 (Pubitemid 39259580)
17. H.J. Bullinger, M. Kuhner, and A. Van Hoof Analyzing supply chain peformance using a balanced measurement method Int. J. Prod. Res. 40 15 2002 3533 3543 (Pubitemid 35377567)
18. L. Burney, and S.K. Widener Behavioral work outcomes of a strategic performance measurement system-based incentive plan Behav. Res. Account. 25 2 2013 115 143
19. R.H. Chenhall Integrative strategic performance measurement systems, strategic alignment of manufacturing, learning and strategic outcomes: an exploratory study Account. Org. Soc. 30 5 2005 395 422 (Pubitemid 40289728)
20. R.H. Chenhall, and K. Langfield-Smith The relationship between strategic priorities, management techniques and management accounting: an empirical investigation using a systems approach Account. Org. Soc. 23 3 1998 243 264 (Pubitemid 128340519)
21. R.H. Chenhall, and D. Morris Organic decision and communication processes and management accounting systems in entrepreneurial and conservative business organizations Omega 23 5 1995 485 497
22. A. Chia, M. Goh, and S.H. Hum Performance measurement in supply chain entities: balanced scorecard perspective Benchmark Int. J. 16 5 2009 605 620
23. F. Chirico, D.G. Sirmon, S. Sciascia, and P. Mazzola Resource orchestration in family firms: investigating how entrepreneurial orientation, generational involvement, and participative strategy affect performance Strat. Entr. J. 5 4 2011 307 326
24. J.W. Choi, G.W. Hecht, and W.B. Tayler Strategy selection, surrogation, and strategic performance measurement systems J. Account. Res. 51 1 2013 105 133
25. C.J. Corbett, M.J. Montes-Sancho, and D.A. Kirsch The financial impact of ISO 9000 certification in the United States: an empirical analysis Manage. Sci. 51 7 2005 1046 1059 (Pubitemid 41344639)
26. P.D. Cousins, B. Lawson, and B. Squire Performance measurement in strategic buyer-supplier relationships: the mediating role of socialization mechanisms Int. J. Oper. Prod. Manage. 28 3 2008 238 258
27. A.D. Crabtree, and G.K. DeBusk The effects of adopting the balanced scorecard on shareholder returns Adv. Account. 24 1 2008 8 15
28. C.W. Craighead, D. Ketchen, K.S. Dunn, and G. Hult Addressing common method variance: guidelines for survey research on information technology, operations, and supply chain management Eng. Manage. IEEE Trans. 58 3 2011 578 588
29. T.R. Crook, D.J. Ketchen, J.G. Combs, and S.Y. Todd Strategic resources and performance: a meta- analysis Strategic Manage. J. 29 11 2008 1141 1154
30. R.L. Daft, and R.H. Lengel Organizational information requirements, media richness and structural design Manage. Sci. 32 5 1986 554 571
31. S. Davis, and T. Albright An investigation of the effect of balanced scorecard implementation on financial performance Manage. Account. Res. 15 2 2004 135 153 (Pubitemid 38773451)
32. J.R. Deckop, K.K. Merriman, and S. Gupta The effects of CEO pay structure on corporate social performance J. Manage. 32 3 2006 329 342 (Pubitemid 43641723)
33. T.E. Deal, and A.A. Kennedy Corporate Cultures. Reading MA: 1982 Addison-Wesley
34. S. de Leeuw, and J.P. van den Berg Improving operational performance by influencing shopfloor behavior via performance management practices J. Oper. Manage. 29 3 2011 224 235
35. T. Donaldson, and L.E. Preston The stakeholder theory of the corporation: concept, evidence, and implications Acad. Manage. Rev. 20 1 1995 65 91
36. D. Estampe, S. Lamouri, J.L. Paris, and S. Brahim-Djelloul A framework for analysing supply chain performance evaluation models Int. J. Prod. Econ. 142 2 2013 247 258
37. L. Fitzgerald, S. Brignall, R. Silvestro, C. Voss, and J. Robert Performance Measurement in Service Businesses: Chartered Institute of Management Accountants London 1991
38. M. Franco-Santos, L. Lucianetti, and M. Bourne Contemporary performance measurement systems: a review of their consequences and a framework for research Manage. Account. Res. 23 2 2012 79 119
39. R.E. Freeman Strategic Management: A Stakeholder Approach 1984 Pitman Boston
40. J.R. Galbraith Organization design: an information processing view Interfaces 4 3 1974 28 36
41. P. Garengo, and M.K. Sharma Performance measurement system contingency factors: a cross analysis of Italian and Indian SMEs Prod. Plan. Control 25 3 2014 220 240
42. J. Grafton, A.M. Lillis, and S.K. Widener The role of performance measurement and evaluation in building organizational capabilities and performance Account. Org. Soc. 35 7 2010 689 706
43. L. Grosswiele, M. Röglinger, and B. Friedl A decision framework for the consolidation of performance measurement systems Decis. Support Syst. 54 2 2012 1016 1029
44. A. Gunasekaran, C. Patel, and E. Tirtiroglu Performance measures and metrics in a supply chain environment Int. J. Oper. Prod. Manage. 21 1/2 2001 71 87
45. A. Gunasekaran, C. Patel, and R.E. McGaughey A framework for supply chain performance measurement Int. J. Prod. Econ. 87 3 2004 333 347
46. A. Gunasekaran, and B. Kobu Performance measures and metrics in logistics and supply chain management: a review of recent literature (1995-2004) for research and applications Int. J. Prod. Res. 45 12 2007 2819 2840 (Pubitemid 46695682)
47. S. Guo, and M.W. Fraser Propensity score analysis Stat. Methods Appl. 2010
48. G. Hamel, and C.K. Prahalad Competing for the Future: Breakthrough Strategies for Seizing Control of Your Industry and Creating the Markets of Tomorrow 1994 Harvard Business School Press
49. S. Hamilton, and N.L. Chervany Evaluating information system effectiveness-Part I: Comparing evaluation approaches MIS Quart. 5 3 1981 55 69
50. M.H. Hansen, L.T. Perry, and C.S. Reese A Bayesian operationalization of the resource-based view Strategic Manage. J. 25 13 2004 1279 1295
51. D.A. Harrison, M.E. McLaughlin, and T.M. Coalter Context, cognition, and common method variance: psychometric and verbal protocol evidence Organ. Behav. Hum. Dec. 68 3 1996 246 261 (Pubitemid 126162629)
52. J.J. Heckman, H. Ichimura, and P.E. Todd Matching as an econometric evaluation estimator: Evidence from evaluating a job training programme Rev. Econ. Stud. 64 4 1997 605 654 (Pubitemid 127466391)
53. G.R. Heim, and M.E. Ketzenberg Learning and relearning effects with innovative service designs: an empirical analysis of top golf courses J. Oper. Manage. 29 5 2011 449 461
54. C.E. Helfat, S. Finkelstein, W. Mitchell, M. Peteraf, H. Singh, D. Teece, and S.G. Winter Dynamic Capabilities: Understanding Strategic Change in Organizations. Malden 2007 MA: Blackwell
55. J.F. Henri Management control systems and strategy: A resource-based perspective Account. Org. Soc. 31 6 2006 529 558
56. J.-F. Henri Organizational culture and performance measurement systems Account. Org. Soc. 31 1 2006 77 103 (Pubitemid 43231301)
57. M.A. Hitt, D.R. Ireland, D.G. Sirmon, and C.A. Trahms Strategic entrepreneurship: creating value for individuals, organizations, and society Acad. Manage. Perspect. 25 1 2011 57 75
58. G. Hofstede Culture's Consequences. Beverly Hills 1980 Sage Publications
59. T.R. Holcomb, R.M. Holmes, and B.L. Connelly Making the most of what you have: managerial ability as a source of resource value creation Strat. Manage. J. 30 5 2009 457 485
60. Z. Hoque, and W. James Linking balanced scorecard measures to size and market factors: Impact on organizational performance J. Manage. Account. Res. 12 1 2000 1 17
61. G.T.M. Hult, D.J. Ketchen, G.L. Adams, and J.A. Mena Supply chain orientation and balanced scorecard performance J. Manage. Issues 20 4 2008 526 544
62. C.D. Ittner, and D.F. Larcker Are nonfinancial measures leading indicators of financial performance? An analysis of customer satisfaction J. Account. Res. 36 1 1998 1 35 (Pubitemid 128665972)
63. C.D. Ittner, D.F. Larcker, and M.W. Meyer Subjectivity and the weighting of performance measures: evidence from a balanced scorecard Account. Rev. 78 3 2003 725 758 (Pubitemid 36989977)
64. C.D. Ittner, D.F. Larcker, and T. Randall Performance implications of strategic performance measurement in financial services firms Account. Org. Soc. 28 7 2003 715 741 (Pubitemid 37170333)
65. R.S. Kaplan, and D.P. Norton The balanced scorecard - measures that drive performance Harvard Bus. Rev. 70 1 1992 71 79
66. R.S. Kaplan, and D.P. Norton Transforming the balanced scorecard from performance measurement to strategic management: Part I Accounting Horizons 15 1 2001 87 104
67. R.S. Kaplan, and D.P. Norton Mastering the management system Harvard Bus. Rev. 86 1 2008 1 16
68. D.P. Keegan, R.G. Eiler, and C.R. Jones Are your performance measures obsolete? Manage. Account. 70 12 1989 45 50
69. D.J. Ketchen, K. Wowak, and C.W. Craighead Resource gaps and resource orchestration shortfalls in supply chain management: The case of product recalls J. Sup. Chain Manage. 50 3 2014 6 15
70. X. Koufteros Testing a model of pull production: a paradigm for manufacturing research using structural equation modeling J. Oper. Manage. 17 4 1999 467 488
71. X. Koufteros, S. Babbar, and M. Kaighobadi A paradigm for examining second-order factor models employing structural equation modeling Int. J. Prod. Econ. 120 2 2009 633 652
72. J. Lehtinen, and T. Ahola Is performance measurement suitable for an extended enterprise? Int. J. Oper. Prod. Manage. 30 2 2010 181 204
73. R.L. Lynch, and K.F. Cross Measure up!: The Essential Guide to Measuring Business Performance: Mandarin 1992
74. H. Mahama Management control systems, cooperation and performance in strategic supply relationships: a survey in the mines Manage. Account. Res. 17 3 2006 315 339 (Pubitemid 44241755)
75. N.K. Malhotra, S.S. Kim, and A. Patil Common method variance in IS research: a comparison of alternative approaches and a reanalysis of past research Manage. Sci. 52 12 2006 1865 1883 (Pubitemid 44927001)
76. J.D. Margolis, and J.P. Walsh Misery loves companies: rethinking social initiatives by business Admin. Sci. Quart. 48 2003 268 305
77. S.A. Melnyk, D.M. Stewart, and M. Swink Metrics and performance measurement in operations management: dealing with the metrics maze J. Oper. Manage. 22 3 2004 209 218
78. J. Mundy Creating dynamic tensions through a balanced use of management control systems Account. Org. Soc. 35 5 2010 499 523
79. A.D. Neely The performance measurement revolution: why now and what next? Int. J. Oper. Prod. Manage. 19 2 1999 205 228
80. A.D. Neely The evolution of performance measurement research Int. J. Oper. Prod. Manage. 25 12 2005 1264 1277
81. A.D. Neely, M. Gregory, and K. Platts Performance measurement system design: a literature review and research agenda Int. J. Oper. Prod. Manage. 15 4 1995 80 116 (Pubitemid 39046837)
82. A.D. Neely, J. Mills, K. Platts, H. Richards, M. Gregory, M. Bourne, and M. Kennerley Performance measurement system design: developing and testing a process-based approach Int. J. Oper. Prod. Manage. 20 10 2000 1119 1145 (Pubitemid 39025963)
83. A.D. Neely, C. Adams, and M. Kennerley The Performance Prism: The Scorecard for Measuring and Managing Business Success 2002 Prentice Hall Financial Times London
84. A. Pavlov, and M. Bourne Explaining the effects of performance measurement on performance: n organizational routines perspective Int. J. Oper. Prod. Manage. 31 1 2011 101 122
85. D.N. Peikes, L. Moreno, and S.M. Orzol Propensity score matching Am. Stat. 62 3 2008 222 231
86. M.E. Porter Towards a dynamic theory of strategy Strat. Manage. J. 12 2 1991 95 117
87. J.D. Rhody, and T.L.P. Tang Learning from Japanese transplants and American corporations Public Pers. Manage. 24 1 1995 19 32
88. J. Roberts Strategy and accounting in a UK conglomerate Account. Org. Soc. 15 1 1990 107 126
89. F.T. Rothaermel, and A.M. Hess Building dynamic capabilities: innovation driven by individual-, firm-, and network-level effects Organ. Sci. 18 6 2007 898 921
90. J. Sarkis, P. Gonzalez-Torre, and B. Adenso-Diaz Stakeholder pressure and the adoption of environmental practices: the mediating effect of training J. Oper. Manage. 28 2 2010 163 176
91. R. Simons Strategic orientation and top management attention to control systems Strat. Manage. J. 12 1 1991 49 62
92. R. Simons How new top managers use control systems as levers of strategic renewal Strat. Manage. J. 15 3 1994 169 189
93. R. Simons Control in an age of empowerment Harvard Bus. Rev. 73 2 1995 80 88
94. R. Simons, A. Dávila, and R.S. Kaplan Performance Measurement & Control Systems for Implementing Strategy: Text & Cases 2000 Prentice Hall Upper Saddle River NJ
95. D.G. Sirmon, M.A. Hitt, D.R. Ireland, and B.A. Gilbert Resource orchestration to create competitive advantage: breadth, depth, and life cycle effects J. Manage. 37 5 2011 1390 1412
96. D.G. Sirmon, and M.A. Hitt Managing resources: Linking unique resources, management and wealth creation in family firms Entrepreneurship Theory and Practice 27 4 2003 339 358
97. D.G. Sirmon, M.A. Hitt, and D.R. Ireland Managing firm resources in dynamic environments to create value: looking inside the black box Acad. Manage. Rev. 32 1 2007 273 292
98. G.B. Sprinkle Perspectives on experimental research in managerial accounting Account. Org. Soc. 28 2 2003 287 318
99. W.A.V. Stede, d. Chow, and C.W.T.W Lin Strategy, choice of performance measures, and performance Behav. Res. Account. 18 1 2006 185 205
100. A. Taylor, and M. Taylor Antecedents of effective performance measurement system implementation: an empirical study of UK manufacturing firms Int. J. Prod. Res. 51 18 2013 1 14
101. M.J. Tyre, and W.J. Orlikowski Windows of opportunity: temporal patterns of technological adaptation in organizations Organ. Sci. 5 1 1994 98 118
102. B. Vandenbosch An empirical analysis of the association between the use of executive support systems and perceived organizational competitiveness Account. Org. Soc. 24 1 1999 77 92
103. S.C. Voelpel, M. Leibold, and R.A. Eckhoff The tyranny of the balanced scorecard in the innovation economy J. Intellect. Cap. 7 1 2006 43 60
104. K.D. Wowak, C.W. Craighead, D.J. Ketchen, and G.T.M. Hult Supply chain knowledge and performance: a meta-analysis Decision Sci. 44 5 2013 843 875
105. S.K. Widener An empirical analysis of the levers of control framework Account. Org. Soc. 32 7 2007 757 788
106. J.L. Zimmerman Accounting for Decision Making and Control: 2000 Irwin/McGraw-Hill Boston