ŠIŠKA, Ladislav. How Strategic Priorities Are Reflected in Features of Strategic Performance Measurement System? Engineering Economics, Kaunas, Litva: Technologija - Kaunas University of Technology, 2018, vol. 29, 5 (2018), p. 591-600. ISSN 1392-2785. doi:10.5755/j01.ee.29.5.17463.
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Original name How Strategic Priorities Are Reflected in Features of Strategic Performance Measurement System?
Name in Czech Jak se strategické priority odrážejí do charakteristik systémů pro měření výkonnosti?
Authors ŠIŠKA, Ladislav (203 Czech Republic, guarantor, belonging to the institution).
Edition Engineering Economics, Kaunas, Litva, Technologija - Kaunas University of Technology, 2018, 1392-2785.
Other information
Original language English
Type of outcome Article in a journal
Field of Study 50204 Business and management
Country of publisher Lithuania
Confidentiality degree is not subject to a state or trade secret
WWW URL
Impact factor Impact factor: 0.730
RIV identification code RIV/00216224:14560/18:00105102
Organization unit Faculty of Economics and Administration
Doi http://dx.doi.org/10.5755/j01.ee.29.5.17463
UT WoS 000453577500010
Keywords in English Contingency Theory; Differentiation Strategy; Cost-leadership Strategy; Performance Measurement; Performance Measurement Systems; Management Control; Levers of Control
Tags management accounting, managerial accounting, Performanace Management, Structural Equation Modelin
Tags International impact, Reviewed
Changed by Changed by: Mgr. Daniela Marcollová, učo 111148. Changed: 4/4/2019 10:42.
Abstract
Strategic Performance Measurement Systems (SPMSs) are designed to present integrated information, which together with other controls in Management Control Systems (MCSs) helps managers to implement strategy properly and thus outperform the company’s competitors. A wide range of potential factors impacting the design and use of SPMS and MCS has been studied by proponents of the contingency theory since the 1980s who soon found strategy to be one of the most dominant contingencies. But recent reviews of contingency theory provide mixed, sometimes even conflicting evidence, partly because of inconsistent definitions of MCS and SPMS, partly because of exploring contingencies in isolation from other context factors and components. This article addresses both of these challenges. Firstly, it introduces four distinctive features of SPMS and complements them with often neglected “Beliefs” and “Boundaries” controls from the influential MCS framework “Levers of Control” devised by Simons (1995). Secondly, the resulting MCS concept is tested by PLS-SEM whether or not it is influenced by contingency factors of size, industry and especially by two opposing Porter’s generic strategic priorities – differentiation and/or cost-leadership (low prices). Surprisingly, only the former is found to be positively connected to the features of SPMS, however, the link is not direct but mediated by improvements in Boundaries and Beliefs. So the study broadens current knowledge on antecedents of SPMSs, that are applied in the medium-sized and large companies. At the same time, the study urges managers trying to implement differentiation strategy not only to establish the SPMS with all analyzed features, but concurrently to promote values and other belief controls as well as to set organizational rules and boundaries. In other words, the implementation of differentiation strategy has to be accompanied by establishment of the MCS incl. Beliefs and Boundaries, not just SPMS. Contrary to this implication, in case of low-price strategy, the detailed analysis proves that Belief and Boundary components of MCS are not very important tools for achieving cost-leadership.
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MUNI/A/1001/2016, internal MU codeName: Nástroje podnikového controllingu a jejich IT podpora
Investor: Masaryk University, Grant Agency of Masaryk University, Category A
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