Performance Measures for Managerial Decision Making: Performance Measurement Synergies in Multi-Attribute Performance Measurement Systems

摘要

This research tests for correlation between corporate performance and use of financial measures, nonfinancial measures, and number of balanced scorecard categories used. Literature notes a preference for managing by nonfinancial measures because financial measures are lagging indicators, but little empirical evidence is available on the relationship between nonfinancial measures and financial performance, and few companies are found to realize the benefits of nonfinancial measurements. The balanced scorecard has been studied to find the impact of diversity of performance measures, and anecdotal improvements have been reported, but there is a paucity of empirical evidence regarding how the use of a balanced scorecard impacts organizational performance. These issues are investigated in this research with a web based survey distributed to a sample of publicly traded companies using a systematic selection process based on randomly selected numbers generated for each 3-digit NAICS category. The dependent variable is a rank of high, medium or low performance based on 12-month rolling average stock price comparisons from January 2005 to January 2009. These averages are analyzed as a percent change for each company, with performance standardized by 3-digit NAICS category to eliminate cross industry variance in performance ranking. Kruskal-Wallis one-way ANOVA is used to test for correlation. High performers show greatest utilization of both financial and nonfinancial measures, followed by medium performers, with low performers utilizing both measures the least. Nonfinancial performance measures are more correlated to firm value than financial measures with the high performersu27 mean score for nonfinancial measures being higher than for financial measures. By contrast, medium and low performers exhibit the opposite: higher mean scores for financial measures than for nonfinancial measures [p ≤ 0.05 for nonfinancial measures and p ≤ 0.1 for financial measures]. Correlation is found to be borderline significant (p = 0.06) for the number of balanced scorecard categories used with high performers utilizing the highest number of categories and low performers utilizing the lowest number of categories [p = 0.009 with inclusion of two respondents reporting no usage of balanced scorecard categories].