Small and Medium Enterprises play a significant role in economic well-being of a society, but unfortunately there is lack of proper structure and system for application of performance measurement in most of the SMEs. Hence, an inconsistency amongst the performance measures can be observed. The following paper focuses upon distinctive nature of small and medium business organizations (SMEs) and proposes a framework for effective performance measurement with respect to (SMEs). This research aims to provide such a framework for performance measurement that can ensure a balance between internal and external performance measures by introducing the concept of inclusive optimal performance (IOP) as a resultant of inclusive working between internal simultaneous performance (ISP) and external simultaneous performance (ESP). The need for inclusive strategic approach to internal and external performance factors has arrived primarily because of one sided competitiveness is produced due to exclusive strategic approach to inclusive and external performance factors of organization. In order to explore the legitimacy of the depicted argument the following research is based on concept review methodology of literature review through which this research assess the extensive literature with respect to performance measurement systems within SMEs. Through the integration of the psychology-oriented constructs of the internal and external locus of control theory, this research stem the inclusive nature and working of internal and external factors of performance analogy as a basis of the proposed framework that can be applied to ensure effective performance measurement at SMEs.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.