The Balanced Scorecard: Judgmental Effects of Information Organization and Diversity

36 Pages Posted: 13 Feb 1999

See all articles by Marlys Gascho Lipe

Marlys Gascho Lipe

University of South Carolina - Department of Accounting

Steven Salterio

Queen's University - Smith School of Business

Date Written: November 17, 1998

Abstract

This paper examines the judgmental effects of the balanced scorecard. The balanced scorecard contains a large number of financial and nonfinancial performance measures divided into four categories. Based on judgment and decision making theory we examine whether the organization of the information and the diverse (common and unique) measures contained in the scorecard result in differences in managerial performance evaluation judgments. We find that relative performance evaluations are affected by organizing the measures into the balanced scorecard categories. Further, when scorecards for two divisions contain some common and some unique measures, performance evaluations are affected only by the common measures.

JEL Classification: M46

Suggested Citation

Lipe, Marlys G. and Salterio, Steven E., The Balanced Scorecard: Judgmental Effects of Information Organization and Diversity (November 17, 1998). Available at SSRN: https://ssrn.com/abstract=147132 or http://dx.doi.org/10.2139/ssrn.147132

Marlys G. Lipe

University of South Carolina - Department of Accounting ( email )

The Francis M. Hipp Building
1705 College Street
Columbia, SC 29208
United States
803 576-5552 (Phone)

Steven E. Salterio (Contact Author)

Queen's University - Smith School of Business ( email )

Kingston, Ontario K7L 3N6
Canada
613-533-6926 (Phone)

HOME PAGE: http://smith.queensu.ca/faculty_and_research/faculty_list/salterio-steven.php

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