Performance Measurement Systems: Putting Organizational Effectiveness Ahead

Abstract:     
In the last decade a plethora of studies have been carried out in the area of new multidimensional performance measurement systems (MPMS). Notable efforts were focused on PMS design issues related for example to the proper dimensions to be considered, new area of measurement(competencies, networks and supply chain), or their role in the strategy formulation. More recently new streams of research were addressed to the critical analysis of claimed effectiveness with specific regard to the linkage with business performance, or with the management control system (MCS). This paper extends the critical stream of research on MPMS to the organizational linkages of performance and presents a new framework based on the measurement of the relations between formal organizational units as units of analysis. Specifically, this framework introduces a new dimension in the designing of MPMS because it focuses on the measurement of the relationships and not on pre-codified indicators even if systematically organized (tableau de bord, balanced scorecard, ...). In this perspective, the approach enables MPMS to be aligned with the organizational structure of MCS and increases the effectiveness of the appraisal because they are based on a shared view of the organizational functioning. The framework is supported by a case study conducted in an Italian top luxury car firm.

Number of Pages in PDF File: 14

Keywords: Performance measurement systems, KPI, BSC, Management Control

JEL Classification: M40, M41, M12

working papers series