Performance measurement design within its organisational context—Evidence from China

Abstract

a b s t r a c tThis paper presents an action research study that looks at the design of a performance measurement system in a large Chinese state-owned enterprise, focussing on how change happens. A stakeholder analytical framework is developed to bridge the gaps in westerndeveloped models when they are applied in a Chinese context. Analysis revealed the factors determining the nature of change and shaping the performance measurement system. Political constraints and the unavailability of key databases act as barriers to change, while user participation and embedding existing practice both contribute to reducing resistance and promoting continuous improvement. Reinforced by Chinese culture, these factors result in an evolutionary pattern of change. The study shows that the performance measurement system of the case company has fulfilled symbolic functions to signal strategic focus and to influence decision-making.

Public sector management accounting in emerging economies: A literature review

“…For instance, Hopper et al (2001) and Wickramasinghe and Hopper (2005) both found that management controls in Sri Lanka and Bangladesh were captured by the political parties in power and their sponsored trade union parties, and that they, rather than human resources managers, determined workers' pay, leave and promotions. Similar patterns, such as political considerations in rational measures of performance measurement, budgeting and operational decision making, are also evident in the Chinese public sector (Li & Tang, 2009).…”

The Relationships among Strategic Performance Measurement Systems, IS Strategic Alignment, and IT Infrastructure for Knowledge Management

“…SPMS promotes organizational learning through the functions of communications, dialogues, discussions and evaluations of the business strategic topics among the members of an organization. The positive effects of SPMS on the alignment of management processes with business strategy or business strategic objectives were empirically demonstrated in prior research (e.g., Ittner et al, 2003;Chenhall, 2005;Li and Tang, 2009). However, their research mostly focused on the strategic alignment itself, and did not clearly uncover and confirm the learning facilitating roles of SPMS.…”

“…SPMS, which combines financial, strategic (e.g., customers and innovations) and business processes or operating measures, is a useful tool to gauge how well a firm meets its strategic targets. Because of this combination or integration characteristic of SPMS, SPMS can enhance the understanding of the cause-effect linkages between operations and business strategy and goals, and between various aspects of the value chain including suppliers and customers (Li and Tang, 2009). SPMS, which focuses on integrating business operations or functional processes with business strategy, is defined as a system that translates competitive strategy into deliverable results and reveals ways to achieve business strategic objectives.…”

“…The adoption levels of SPMS were measured by considering the inclusion of strategic orientations in performance measures, links between business strategy and management activities, the reflection of strategic objectives in business processes, and relationships with customers and suppliers in performance evaluations (Chenhall, 2005;Li and Tang, 2009). Twelve question items, developed by Chenhall (2005), were utilized to measure the adoption degree of SPMS.…”

“…SPMS supports the active sharing or transfer of various kinds of strategic-related information among organization members, which allows the firm to identify the functional tactics or strategies (e.g., IS strategy) offering the highest potential for achieving the firm's strategic objectives and thus, aligns management processes (e.g., the processes of IS strategy development) with the achievement of the chosen strategic business goals (Li and Tang, 2009;Artz et al, 2012). Through the functions of strategic dialogues or communications and learning among the employees of a firm, which are provided by SPMS, IS strategic alignment can be successfully attained in an organization.…”