Measuring Organizational Performance: Identifying barriers of balanced scorecard adoption as administrative tool for performance measurement in Pakistan
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Date
2012
Authors
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Publisher
University of Management and Technology
Abstract
The prime objective of this study was to identify the status of Balanced Scorecard
(BSC) adoption in Pakistanand to what extent different organizational, environmental and
some contingency factors serve as barrier in the strategic adoption of BSC as administrative
tool to measure performance of organizations. Different organizational theories, strategic
adoption, innovation diffusion theory and general system theory were reviewed and to
develop theoretical framework these theories were considered as starting point. The literature
related to these theories aided in the development of eleven hypotheses. All organizations of
Pakistanirrespective of type, nature and location were selected to test the hypotheses. These
organizations were selected by systematic random sampling and a sample of 287 was
calculated from a sampling frame taken from Karachi Stock Exchange. After pretesting the
adapted instrument was furthermore validated through Cronbach alpha and factor analysis.
The impact of different factors as barrier was tested through correlation and regression
analysis. It was found through analysis that all four organizational factors were very strong
barriers in the adoption of BSC as compared to four environmental factors and contingency
factors. The salient nature of organizational factors supporting the resource based view in
organization for strategic decision for adoption. Specifically, it was analyzed that the
organizational complexity, slack resources, knowledge dearth, supportive domain,
environmental complexity, completion, consultancy institutions, strategic orientation and
manager's characterizes were fulfilling and following the relationship reported in literature
and were serve as barrier in the adoption of BSC. However, the factor network personality, a
part of the environmental factors, was not significant and was not a barrier. The control
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variables like manager's age, education, marital status and industry type of the organization
are not statistical significant. Through this study the factors identified as barriers for an
organization were not available in the BSC adoption literature. The managers of consultancy
institutions can view this study as benchmark because by reviewing the result they can decide
whether it is time to launch a campaign to exert the pressure for adoption of BSC or not to
propagate the significance of BSC tool by stopping further allocation of resources.
Additionally, the mangers of large organizations can also get benefits from this study by
adoption BSC to get competitive edge over competitors as this was worldwide accepted tool.
Description
Project Advisor: Dr. Tashfeen Mahmood Azhar
Keywords
MS Thesis, Balanced Scorecard, Strategic Adoption, Performance standards