Method for performance measurement of car companies from a stability-value leverage perspective

2019 ◽  
Vol 10 (1) ◽  
pp. 411-434 ◽  
Author(s):  
Wouter Beelaerts van Blokland ◽  
Sebastiaan van de Koppel ◽  
Gabriel Lodewijks ◽  
Wouter Breen
Keyword(s):  
Performance Measurement ◽  
Lean Manufacturing ◽  
Business Performance ◽  
Research Question ◽  
Company Performance ◽  
Maturity Model ◽  
Content Type ◽  
Main Research ◽  
Performance Measurement Systems ◽  
Level I

Purpose Today, most of the car manufacturers world-wide have embraced the principles of lean manufacturing on strategic and operational level. On strategic level car companies like Toyota (Womack et al., 1990) shifted 63 per cent of the value of the car towards the first, second and third tier suppliers for the co-production and co-development of cars as an effect of lean implementation. However, lean implementation was also followed by for instance Ford and GM in the USA, the latter company faced a sudden disruption in 2009 due to the break-out of the financial crisis in 2008, while Ford survived. Could this be foreseen? The exclusive use of (classic) financial performance indicators may give a false image of a company’s current and future performance. There is a need for a model to identify “the stars and the laggards’ regarding car companies by taking into account non-financial and intangible dimensions as advocated by Neely et al. (2003) regarding the third generation of business performance measurement systems. The purpose of this paper is therefor to propose a method to measure and benchmark car company performance which includes the non-financial R&D dimension as well as supply chain, value creating and employee dimensions. These dimensions are present in the value leverage model (van Blokland et al., 2012a, 2012b) which can serve as a basis for this method. The aim is to contribute to the third generation business performance measurement systems by further development of the value leverage model towards a maturity model for benchmarking car company performance. The proposed method can provide a big picture and give insight regarding company performance and direction of the performance. Design/methodology/approach Value leverage can be measured by a correlation analysis regarding three dimensions, namely, supply chain, R&D and value creation, all relative to the employee or capita which results in the average value leverage (AVL) factor. This AVL factor can be used to compose a combined relative and absolute ranking. The score regarding the AVL results in a relative ranking expressing the level of stability regarding the car companies value chain and system. For the absolute ranking the car companies receive per variable parameter a score according to their absolute performance relative to the other car companies. The relative and absolute ranking are presented on the vertical and horizontal axes forming a matrix. The matrix is the basis for the stability-value leverage maturity model for measuring and benchmarking company performance. With the proposed method, the following main research question can be answered: “How can company performance be measured and benchmarked from a stability-value leverage perspective?”. Findings With the proposed method, stability-value leverage performance can be measured. The relative ranking on the vertical axis and the absolute ranking form together a matrix which is presented by a scatterplot. A matrix with four maturity levels emerged from the analysis by introducing the average score of all the car companies together in the data set crossing the matrix vertical and horizontal. The four levels are as follows: Level I, low stability – low value leverage; Level II, low stability – high value leverage; Level III, high stability – low value leverage; and Level IV, high stability – high value leverage. Stability-value leverage performance of car companies can be measured over time which makes it possible to observe to which direction the car company migrates for instance from Level I to Level III, before and after the financial crises in 2008. The car companies BMW, Daimler, Audi, Ford and Honda are the best performing companies in stability-value leverage over the period 2000-2014, as they are situated at Level IV. With the findings, the main research question can be answered. The value leverage indicators can be used for measuring and benchmarking company performance regarding four maturity levels of stability and value leverage. The direction of performance can be observed as well. Research/limitations/implications This research is limited to the car industry. Further research is devised to test the indicators for instance on the truck manufacturing industry. Further research towards new variables is part of the ongoing research. Practical/implications With the value leverage maturity model, it is possible to inform stakeholders about stability, value leverage and value creation capability of car companies. Weak performing companies can be identified in an early stage with this method to anticipate for instance on possible discontinuation of a car company effecting in merger an acquisition processes. Social/implications With the method stakeholders such as employees, users of cars and investors can be informed about how and why car companies perform in an unstable or stable manner. Originality/value This research towards ranking and classification of car companies aligns with theories regarding lean manufacturing and maturity models, as these models are used to compare companies on their level of perfection or excellence.

Executing strategy through comprehensive performance measurement systems

2017 ◽  
Vol 37 (4) ◽  
pp. 423-443 ◽  
Author(s):  
Pietro Micheli ◽  
Matteo Mura
Keyword(s):  
Performance Measurement ◽  
Performance Indicators ◽  
Company Performance ◽  
Content Type ◽  
Cost Leadership ◽  
Measurement Systems ◽  
Comprehensive Performance ◽  
Different Types ◽  
Performance Measurement Systems

Purpose The purpose of this paper is to investigate the mediating role of comprehensive performance measurement systems (PMS) – i.e. measurement systems that comprise financial and non-financial indicators, and which also consist of indicators related to different aspects of an organisation’s operations – in the relationship between strategy and company performance. Design/methodology/approach Survey data of top managers of large European companies were collected and analysed by means of exploratory factor analyses and hierarchical regressions in order to validate the proposed hypotheses. Findings This research shows that different strategies lead to the use of different types of performance indicators. Also, it finds that the utilisation of a comprehensive PMS enables the implementation of both differentiation and cost-leadership strategies. Specifically, a comprehensive PMS positively mediates the effect of differentiation strategy on organisational and innovative performance, and of cost-leadership strategy on organisational performance. Research limitations/implications Further research could be undertaken in other contexts and consider additional factors, such as the structure, maturity and different uses of PMS, and the cost of measuring performance. Qualitative studies could examine the role of PMS in dynamic environments, as well as the evolution of PMS during strategic transitions. Practical implications Greater consideration should be given to the utilisation of different types of performance indicators when implementing and re-formulating strategy. Originality/value This study clarifies the links between strategy and performance measurement, and it is the first to identify the mediating effect of comprehensive PMS between strategy and company performance.

Governmentality and performance for the smart city

2019 ◽  
Vol 33 (1) ◽  
pp. 204-232 ◽  
Author(s):  
Daniela Argento ◽  
Giuseppe Grossi ◽  
Aki Jääskeläinen ◽  
Stefania Servalli ◽  
Petri Suomala
Keyword(s):  
Performance Measurement ◽  
Smart City ◽  
Smart Cities ◽  
Research Question ◽  
Longitudinal Case Study ◽  
Content Type ◽  
Measurement Systems ◽  
Performance Measurement Systems

Purpose The purpose of this paper is to explore the role of performance measurement systems as technologies of government in the operationalisation of smart city programmes. It answers the research question: how do the development and use of performance measurement systems support smart cities in the achievement of their goals? Design/methodology/approach This paper presents a longitudinal case study that uses an interventionist approach to investigate the possibilities and limitations of the use of performance measurement systems as technologies of government in a smart city. Interpretations are theoretically informed by the Foucauldian governmentality framework (Foucault, 2009) and by public sector performance measurement literature. Findings The findings address the benefits and criticalities confronting a smart city that introduces new performance measurement systems as a technology of government. Such technologies become problematic tools when the city network is characterised by a fragmentation of inter-departmental processes, and when forms of resistance emerge due to a lack of process owners, horizontal accountability and cooperation among involved parties. Research limitations/implications This paper is based on a case study of a single smart city, and outlines the need for both comparative and multidisciplinary analyses in order to analyse the causes and effects of smart city challenges. Originality/value This paper offers a critical understanding of the role of accounting in the smart city. The ineffectiveness of performance measurement systems is related to the multiple roles of such technologies of government, which may lead to a temporary paralysis in the achievement of smart city goals and programmes.

Performance measurement adoption and business performance

2015 ◽  
Vol 53 (1) ◽  
pp. 139-159 ◽  
Author(s):  
Nikolaos Otheitis ◽  
Martin Kunc
Keyword(s):  
Performance Measurement ◽  
Business Performance ◽  
Safety Management ◽  
Superior Performance ◽  
Unique Contribution ◽  
Shipping Industry ◽  
Total Trade ◽  
Content Type ◽  
Ship Management ◽  
Performance Measurement Systems

Purpose – Seaborne trade accounts for 90 per cent of world’s total trade activity. Ship management is a highly skilled discipline with a high degree of complexity yet it has failed to follow with the same pace the advancements of performance measurement systems (PMSs) like other industries. Business performance measurement has only recently become a relevant topic in shipping. The purpose of this paper is to evaluate the adoption of PMS in the shipping industry. Design/methodology/approach – A questionnaire was developed based on the performance measurement literature and submitted to 100 shipping companies around the world obtaining 41 usable questionnaires covering 13 countries from Europe, Asia and America. Findings – The adoption of performance measurement differs based on type of business: liquid bulk (tanker) vessels and bulk carriers or containers. Quality and safety management systems have fostered the adoption of performance measurement positively in tankers impacting decision making and the performance of shipping companies using PMS. Research limitations/implications – While the sample is representative of the situation of the industry, it represents the results of one point in time. Practical implications – The use of PMSs can be a tool to achieve superior performance but it may be fostered by, and has to be aligned with the needs of, internal and external stakeholders. Early adopters in the shipping industry are among the leaders in the industry. Originality/value – The paper is a unique contribution to performance measurement since it explores the adoption of PMSs and its impact in performance at industry level in a global industry.

Knowledge assets, capabilities and performance measurement systems: a resource orchestration theory approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kaveh Asiaei ◽  
Zabihollah Rezaee ◽  
Nick Bontis ◽  
Omid Barani ◽  
Noor Sharoja Sapiei
Keyword(s):  
Performance Measurement ◽  
Corporate Performance ◽  
Equation Modeling ◽  
Knowledge Assets ◽  
Content Type ◽  
Knowledge Resources ◽  
Measurement Systems ◽  
Resource Orchestration ◽  
Performance Measurement Systems ◽  
The Relationship

Purpose The pivotal role of knowledge management (KM) and its extensive implications have been debated in the academic literature with insufficient focus on its link to particular organizational control mechanisms such as performance measurement systems (PMS). To bridge this gap and building on resource orchestration theory, this paper aims to investigate the relationships between KM factors, PMS and corporate performance. Design/methodology/approach Based on a survey data set of 92 listed companies in Iran, the framework and hypotheses were tested using structural equation modeling (SEM) based on partial least squares (PLS). Findings The SEM-PLS results indicate that knowledge assets are significantly associated with both PMS and corporate performance while knowledge process capabilities (KPC) are not significantly associated with PMS and corporate performance. This study also shows that PMS mediates the relationship between knowledge assets and corporate performance. Practical implications The results suggest that the use of appropriate management control systems plays an effective role in synchronizing, aligning and orchestrating a company’s various knowledge resources, which, in turn, can lead to superior overall performance. Originality/value Building on a unique synthesis of resource orchestration theory and the knowledge-based view of the firm, the results of this study provide the first empirical evidence on how PMS intervenes in the relationship between knowledge resources (knowledge assets and KPC) and corporate performance.

Supplier performance measurement system use, relationship trust, and performance improvement: a dyadic perspective

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Vieri Maestrini ◽  
Andrea Stefano Patrucco ◽  
Davide Luzzini ◽  
Federico Caniato ◽  
Paolo Maccarrone
Keyword(s):  
Performance Measurement ◽  
Performance Improvement ◽  
Measurement System ◽  
Structural Equation ◽  
Performance Measurement System ◽  
Content Type ◽  
Performance Improvements ◽  
Supplier Performance ◽  
Performance Measurement Systems ◽  
The Impact

PurposeGrounding on resource orchestration theory, this paper aims to study the relationship between the way buying companies use their supplier performance measurement systems and the performance improvements obtained from suppliers, with relationship trust identified as a mediator in the previous link.Design/methodology/approachThe authors design a conceptual model and test it through structural equation modelling on a final sample of 147 buyer-supplier responses, collected by means of a dyadic survey.FindingsResults suggest that the buyer company may achieve the most by balancing a diagnostic and interactive use of the measurement system, as they are both positively related to supplier performance improvement. Furthermore, relationship trust acts as a mediator in case of the interactive use, but not for the diagnostic. This type of use negatively affects relationship trust, due to its mechanistic use in the buyer-supplier relationship.Originality/valueThe authors’ results contribute to the current academic debate about supplier performance measurement system design and use by analyzing the impact of different supplier performance measurement system uses, and highlighting their relative impact on relationship trust and supplier performance improvement. From a methodological perspective, adopting a dyadic data collection process increases the robustness of the findings.

Stakeholders and opportunities of debt settlement as a values-based banking activity in Hungary

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Zsuzsanna Győri ◽  
Borbála Benedek
Keyword(s):  
Research Question ◽  
Good Practice ◽  
Banking System ◽  
Financial Inclusion ◽  
Stressful Situation ◽  
Content Type ◽  
Main Research ◽  
The Poor ◽  
Lessons Learnt

Purpose The purpose of this paper is to discuss the stakeholders of debt settlement programmes in general and some lessons learnt from the most significant debt settlement programmes of recent years in Hungary. The study also presents a planned debt settlement programme in Hungary. The paper explores and details behaviours and motivations of different stakeholders in debt settlement in general and also with reference to a specific case study. As for its main research question, the paper seeks to identify the preconditions of a successful debt settlement programme with specially emphasis on the poor. Design/methodology/approach Data from semi-structured in-depth expert interviews, documents and former research papers were collected for identifying previous Hungarian debt settlement programmes and potential lessons learnt. After a general discussion, based on primary and secondary sources, a case study is presented to obtain a more comprehensive understanding of opportunities and challenges of debt settlement. Findings Six preconditions of successful debt settlement targeting the poor are identified. In the case study, the existence and relevance of these preconditions are tested: the main finding is that they all are important for solving the situations, so a partial solution is not sufficient. In the scope of the case study, more precisely within the planned innovative banking solution, the motivations of the bank and the coordinator NGO are identified. On the part of the bank, motivations for solving social problems (both as far as business and moral issues are concerned) are relevant, while – as for the other party – the situation of the debtor is important to understand so that opportunities of cooperation can be identified. In addition, as other stakeholders also influence the potentials of the programme, their cooperative attitude is also needed. Research limitations/implications Limitations consist in generalisation: the study presents some cases from one single country and finally it focuses only on one specific case in one specific social and economic context in Hungary. Having recognized this risk, the author opted for basing research questions on theory, documented the process in detail, and also used triangulation through applying a multiple data collection (interview, content analysis, literature review) method. Practical implications Besides presenting an academic understanding of the phenomena, the goal of the study is to contextualize and interpret the case, to help the realization of currently frozen initiatives and to promote similar future ones. Social implications Indebtedness is a stressful situation affecting families, smaller communities and broader society as well. The planned cooperation of BAGázs and MagNet tries to help people excluded from the banking system. So that a deeper debt trap can be avoided, the goal of this programme is to purchase, partially discharge and reschedule pre-accumulated debts of carefully selected people who have regular income and are willing to undertake bearable repayment. The idea is very innovative with literally no good practice to follow. The research seeks to clarify the pitfalls and opportunities to help the realization of the project and similar future ones. Originality/value A certain form of values-based banking concerns the financial inclusion of the poor, e.g. debt settlement. Nevertheless, over-indebtedness and the settlement of existing debts as well as the relevance of such issues to the financial inclusion are not emphasized enough in the literature or in practice. Besides presenting an academic understanding of the phenomena, the goal of the study is to contextualize and interpret the case, to help the realization of currently frozen initiatives and to promote similar future ones.

scholarly journals DISCOVERING PERFORMANCE MEASUREMENT SYSTEM TO EVALUATE THE EFFICIENCY OF E-BUSINESS SOLUTIONS / VEIKSMINGUMO MATAVIMO SISTEMOS PAIEŠKOS E. VERSLO NAŠUMUI ĮVERTINTI

2012 ◽  
Vol 4 (3) ◽  
pp. 216-223 ◽  
Author(s):  
Laura Uturytė-Vrubliauskienė
Keyword(s):  
Performance Measurement ◽  
Measurement System ◽  
Business Performance ◽  
Information Technologies ◽  
Economic Benefits ◽  
Performance Measurement System ◽  
Exact Nature ◽  
Organization Performance ◽  
Basic Objective ◽  
Performance Measurement Systems

Despite the significant growth of information technologies investments, evidence of their influence on organization performance remains inconclusive. Nowadays it is very important to realize whether expected economic benefits of information technologies investments are being recognized in organizations. Currently organizations can no longer afford basically to lose their money in e-business initiatives without developing and using suitable metrics to measure the effectiveness of such investments and to find out the relationship between e-business and organization performance. The study describes research aimed at determining the exact nature of such e-business performance measurement systems. The basic objective of this study is to discover performance measurement system for evaluating the efficiency of e-business solutions. Santrauka Svarbiausias šiuolaikinės organizacijos tikslas – didinti verslo vertę sėkmingai taikant konkurencingas priemones. Dėl to organizacijos yra priverstos ieškoti alternatyvių būdų, kaip spręsti verslo problemas. Dabartinėje visuomenėje, vykstant sparčiai technologijų kaitai ir globalizacijos procesui, verslas ir informacinės technologijos yra neatsiejami. Organizacijos, norėdamos tinkamai valdyti duomenis, keistis jais su partneriais ieško įvairių informacinių technologijų sprendimų. Organizacijų investicijos į informacines technologijas per pastaruosius du dešimtmečius auga labai stipriai. Tačiau sudėtinga įvertinti, kokią įtaką verslo efektyvumui turi diegiamos ir naudojamos informacinės technologijos. Todėl pasaulinės konkurencinės rinkos sąlygomis veiklos vertinimas tampa svarbia ekonomine problema. Sėkmingą verslą garantuoja informacija apie kiekvieno produkto ar vartotojo pelningumą ir atskirų padalinių veiklos efektyvumą. Mokslinio tyrimo rezultatai rodo, kad trūksta galimybių įvertinti verslo veiksmingumą. Pagrindinis šio straipsnio tikslas – veiksmingumo matavimo sistemos paieškos, leidžiančios įvertinti elektroninio verslo sprendimų našumą. Atskleidžiant poreikį kurti ir diegti tokias sistemas organizacijose, įrodant, kad veiksmingumo sistemos, taikomos šiuo metu, netinka taikyti organizacijoms, jos turi būti adaptuotos ir gebėti įvertinti informacinių technologijų įtaką veiklos našumui.

scholarly journals Framework of performance measurement practices in construction companies in Egypt

2018 ◽  
Vol 10 (2) ◽  
pp. 7-14 ◽  
Author(s):  
Krzysztof Dziekoński ◽  
Omar Hesham Mohamed Fawzy Ibrahim ◽  
Abdul-Majeed Mahamadu ◽  
Patrick Manu
Keyword(s):  
Performance Measurement ◽  
Performance Assessment ◽  
Performance Management ◽  
Construction Industry ◽  
Dominant Role ◽  
Holistic Approach ◽  
Company Performance ◽  
Construction Company ◽  
Construction Companies ◽  
Performance Measurement Systems

Abstract Construction industry is considered as one of the most important sectors in Egypt. One of the major challenges faced by the industry, however, is the unavailability of suitable performance measurement systems for assessing companies’ performance. Modern performance assessment systems adopt a more universal approach to the measurement of construction company performance as opposed to the traditional project triangle. This paper aims to examine the practice of performance measurement in the Egyptian construction industry. Results show dominant role of in-house developed performance management systems as well as the use of KPIs as a method of performance assessment. The study further reveals that the highest importance is given to measures related to the time of project delivery, quality of works, clients’ satisfaction and profitability. Hence, the traditional project triangle of project’s success is the most prevalent approach to performance evaluation in the construction industry in Egypt. However, a shift towards a more holistic approach to performance assessment in larger companies was observed.

Intellectual capital and performance measurement systems in Iran

2018 ◽  
Vol 19 (2) ◽  
pp. 294-320 ◽  
Author(s):  
Kaveh Asiaei ◽  
Ruzita Jusoh ◽  
Nick Bontis
Keyword(s):  
Performance Measurement ◽  
Organizational Performance ◽  
Intellectual Capital ◽  
Structural Model ◽  
Chief Financial Officers ◽  
Least Squares Regression ◽  
Content Type ◽  
Intellectual Assets ◽  
Performance Measurement Systems ◽  
And Performance

PurposeThe purpose of this paper is to empirically explore how the effect of intellectual capital (IC) on organizational performance is indirect and mediated through performance measurement (PM) systems.Design/methodology/approachData were collected from a survey of 128 chief financial officers of Iranian publicly listed companies. Hypotheses were tested using partial least squares regression, a structural modeling technique which is appropriate for highly complex predictive models.FindingsResults from the structural model indicate that, in general, companies with a higher level of IC place a premium on the balanced use of PM systems in a diagnostic and interactive style. Furthermore, the results provide some evidence that IC is indirectly associated with organizational performance through the intervening variable of the balanced use of interactive and diagnostic PM systems.Practical implicationsThis study sheds light on the issue of how senior management should use PM systems to take full advantage of intellectual assets which could lead to improved organizational performance.Originality/valueThis is the first study of its kind to synthesize a model which examines IC, PM systems, and organizational performance. Although the effect of different types of intangible assets on performance has been substantially examined in the literature, less effort has been devoted to understanding the role of PM systems in leveraging an organization’s IC.

Assessing performance-use preferences through an institutional logics lens

2019 ◽  
Vol 32 (1) ◽  
pp. 2-20
Author(s):  
Benard Ngoye ◽  
Vicenta Sierra ◽  
Tamyko Ysa
Keyword(s):  
Public Sector ◽  
Performance Measurement ◽  
Institutional Logics ◽  
Content Type ◽  
The Public ◽  
Measurement Systems ◽  
Cognitive Frames ◽  
Public Market ◽  
Theoretical Predictions ◽  
Performance Measurement Systems

PurposeThe purpose of this paper is to examine the influence of shared cognitive frames, in particular, that of institutional logics, on the deployment and use of performance measurement systems (PMSs) in the public sector.Design/methodology/approachUsing novel priming techniques derived from behavioral and social psychology, three institutional logics – the public, market-managerial and professional logics – are differentially surfaced in three independent experimental groups. The influence of these primed institutional logics on performance measurement use preferences are then empirically assessed using appropriate analysis of variance techniques.FindingsContrary to theoretical predictions, the paper reveals logic congruence regarding some uses of PMSs in the public sector, and divergence regarding others. Individuals applying a public logic were more likely to propose performance measurement use for strategic planning or strategic alignment; while those applying a professional logic were more likely to propose performance measurement use for learning, compared to otherwise primed individuals.Research limitations/implicationsConsidering the sample size and the novelty of the priming tools, it is feasible that other potentially significant effects may have been missed.Originality/valueThe paper addresses a gap in literature regarding the influence of shared cognitive frames on performance measurement use in public sector organizations. The paper further presents priming techniques embedded within an experimental design as an appropriate method for the micro-level study of attitudes, preferences and judgments in the public sector.

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