TY - JOUR
T1 - A contingency model of the association between strategy, environmental uncertainty and performance measurement
T2 - Impact on organizational performance
AU - Hoque, Zahirul
PY - 2004
Y1 - 2004
N2 - From a contingency framework, this paper attempts to contribute to a stream of literature that investigates determinants and consequences of performance measures. In general, it investigates the role of the choice of performance measures on the relationship between (a) strategic priorities and performance and (b) environmental uncertainty and performance. Two hypotheses are developed concerning this general relationship, predicting, respectively, a positive relationship between business unit strategy and performance through management's choice of non-financial measures of performance (H1) and a positive relationship between environmental uncertainty and performance through management's choice of non-financial measures of performance (H2). To test these hypotheses, a path analytical model is applied to questionnaire survey data from 52 manufacturing companies. As hypothesized, the results revealed the existence of a significant and positive association between management's strategic choice and performance acting through management's high use of non-financial measures for performance evaluation. On the other hand, the study found no evidence of a significant relationship between environmental uncertainty and performance through management's use of non-financial performance measures.
AB - From a contingency framework, this paper attempts to contribute to a stream of literature that investigates determinants and consequences of performance measures. In general, it investigates the role of the choice of performance measures on the relationship between (a) strategic priorities and performance and (b) environmental uncertainty and performance. Two hypotheses are developed concerning this general relationship, predicting, respectively, a positive relationship between business unit strategy and performance through management's choice of non-financial measures of performance (H1) and a positive relationship between environmental uncertainty and performance through management's choice of non-financial measures of performance (H2). To test these hypotheses, a path analytical model is applied to questionnaire survey data from 52 manufacturing companies. As hypothesized, the results revealed the existence of a significant and positive association between management's strategic choice and performance acting through management's high use of non-financial measures for performance evaluation. On the other hand, the study found no evidence of a significant relationship between environmental uncertainty and performance through management's use of non-financial performance measures.
KW - Environment uncertainty
KW - Non-financial measures
KW - Performance measurement
KW - Strategy
U2 - 10.1016/j.ibusrev.2004.04.003
DO - 10.1016/j.ibusrev.2004.04.003
M3 - Comment/debate
SN - 0969-5931
VL - 13
SP - 485
EP - 502
JO - International Business Review
JF - International Business Review
IS - 4
ER -