The use of multi-attribute utility theory to address trade-offs for the Balanced Scorecard.

摘要

As organizations strive to improve their productivity levels in today's competitive business environment, performance measurement systems grow in popularity as a means of assessing an organization's strategic initiatives. Kaplan and Norton's Balanced Scorecard (BSC) has been widely used by many organizations, but is lacking in its ability to indicate the adequacy of specific performance metric levels, to incorporate the business operating environment, and to address the trade-offs between different performance metrics when objectives may conflict. Multi-attribute utility theory (MAUT), a decision making technique that evaluates alternatives where attributes have conflicting objectives, is incorporated into the BSC to address this deficiency.;For this research, a Utility-based Balanced Scorecard (UBSC) is developed that incorporates multi-attribute utility theory into the BSC. The methodology for developing and implementing the UBSC is presented. The traditional four perspectives of the BSC (Financial, Customer, Learning and Growth, and Internal Business) are used in the UBSC. Techniques for weighting perspectives and performance measures and fitting utility functions to the data are developed. Also discussed is incorporating an organization's business operating environment into its UBSC.;A comparison is made between the UBSC and the BSC to examine the time and effort necessary for the development of each. The number of inputs required is used as a surrogate measure for the level of data initially required for development. To examine the resulting benefits of the UBSC and the BSC, the number and types of output are evaluated.;An experimental design is developed to evaluate three factors for UBSC models: business operating environment, distribution of performance measure weights within the perspectives, and distribution of weights across the four perspectives. The business operating environment is modeled using risk neutral utility functions for a stable environment, risk seeking functions for a growth environment, and risk averse functions for a declining environment. For the distribution of weights within and across perspectives, three levels are evaluated: equally-weighted, one high weight, and arbitrary weights.;Two comparisons are conducted. The first is to compare the Oregon Productivity Matrix (OPM) to the stable UBSC to determine if a difference exists between the two models. The second is a simulation to compare the results of the UBSC under the three business operating environments to determine if a difference exists in the output and the magnitude and direction of the difference if one exists. ANOVA is conducted on the full factorial designs for both comparisons.;A case study is presented where the UBSC is developed for an organization. A practitioner assessment is used to gain insight into the practical pros and cons of developing a UBSC in an industry setting. The anecdotal results are presented and discussed.