Practical framework for measuring performance of international construction firms

The internationalization of construction companies has become of significant interest as the global construction market continues to be integrated into a more competitive and turbulent business environment. However, due to the complicated and multifaceted nature of international business and performance, there is as yet no consensus on how to evaluate the performance of international construction firms (ICFs). The purpose of this paper, therefore, is to develop a practical framework for measuring the performance of ICFs. Based on the balanced scorecard (BSC), a framework with detailed measures is developed, investigated, and tested using a three-step research design. In the first step, 27 measures under six dimensions (financial, market, customer, internal business processes, stakeholders, and learning and growth) are determined by literature review, interviews with academics, and seminar discussions. Subsequently, a questionnaire survey is conducted to investigate weights of these 27 performance measures. The questionnaire survey also supports the importance of measuring intangible aspects of international construction performance from the practitioner’s viewpoint. Additionally, a case study is described to test the framework’s robustness and usefulness. This is achieved by benchmarking the performance of a Chinese ICF with nine other counterparts worldwide. It is found that the framework provides an effective basis for benchmarking ICFs to effectively monitor their performance and support the development of strategies for improved competitiveness in the international arena. This paper is the first attempt to present a balanced and practically tested framework for evaluating the performance of ICFs. It contributes to the practice of performance measurement and related internationalization in the construction industry in general.

Does board gender diversity have a financial impact? Evidence using stock portfolio performance.

There is growing regulatory pressure on firms worldwide to address the under-representation of women in senior positions. Regulators have taken a variety of approaches to the issue. We investigate a jurisdiction that has issued recommendations and disclosure requirements, rather than implementing quotas. Much of the rhetoric surrounding gender diversity centres on whether diversity has a financial impact. In this paper we take an aggregate (market-level) approach and compare the performance of portfolios of firms with gender diverse boards to those without. We also investigate whether having multiple women on the board is linked to performance, and if there is a within-industry effect. Overall, we do not find evidence of an association between diversity and performance. We find some weak evidence of a negative correlation between having multiple women on the board and performance, but that in some industries diversity is positively correlated with performance.

Student self-assessment of performance : a useful learning tool for students and instructors?

Assurance of Learning is a focus for many Business Schools to meet AACSB requirements. Prior research has examined student self-assessment as a measure of learning in this context, but we propose instead that this is a useful ‘learning tool’ for students and instructors that can help improve student performance and curricula. We examined self-assessment in a third year undergraduate e-marketing course and found a positive, though weak relationship between student self-assessment and instructor ratings on intended learning goals and criteria for a written assignment. Students who self-assessed tended to perform better in the assessment item and course than those who did not self-assess. But less competent students were more inaccurate in their self-assessment, suggesting a need to enhance understanding of marking criteria and performance standards within this group. Implications for educators are discussed.

ACE research vignette 025 : Is business planning important for entrepreneurial success?

This series of research vignettes is aimed at sharing current and interesting research findings from our team of international Entrepreneurship researchers. This vignette, written by Professor Per Davidsson, takes a closer look at the value of business planning.

ACE research vignette 026 : Do Entrepreneurs’ Personal Networks Influence Small Firm Performance?

This series of research vignettes is aimed at sharing current and interesting research findings from our team of international Entrepreneurship researchers. This vignette, written by Dr. Rene Bakker, examines the evidence on the effects of a entrepreneurs’ personal networks on small firm performance, and the factors that moderate this relationship.

Relationship between CEO salaries and performance of banks in Australia and Germany

Purpose: The purpose of this paper was to examine the relationship between CEO salaries and firm performance in the banking sector. Design/methodology/approach: The data relating to a six year period (2007 - 2012) was gathered from databases and the websites of the major banks in Australia and Germany. The data was subjected to Regression and Pearson Correlation Analysis to test if there was a positive correlation between total salary including incentive bonuses against the variables indicating the performance of the firm. Findings: The tests indicate a weak relationship between the CEO salary package and the key indicators of a firm's performance in Australian banks but a strong relationship in the German banks. Research limitations/implications: This study was limited in that it only covers the major banks in Australia and Germany and may therefore not be relevant to different countries with different economic climates. Practical implications: This study provides additional evidence to support the continued debate regarding the need to have greater accountability for CEO salary packages linked to actual performance measures of firms. Originality/value: This paper adds to the literature in so far as it compares two different Countries of the banking sector in a global market

On effective accounting information systems in a dynamic business environment : the role of complementing capabilities

The global business environment is witnessing tough times, and this situation has significant implications on how organizations manage their processes and resources. Accounting information system (AIS) plays a critical role in this situation to ensure appropriate processing of financial transactions and availability to relevant information for decision-making. We suggest the need for a dynamic AIS environment for today’s turbulent business environment. This environment is possible with a dynamic AIS, complementary business intelligence systems, and technical human capability. Data collected through a field survey suggests that the dynamic AIS environment contributes to an organization’s accounting functions of processing transactions, providing information for decision making, and ensuring an appropriate control environment. These accounting processes contribute to the firm-level performance of the organization. From these outcomes, one can infer that a dynamic AIS environment contributes to organizational performance in today’s challenging business environment.

Star performers : task and contextual performance are components, but are they enough?

Identifying outstanding performers or ‘stars’ is a critical component of managing talent. However, organizational effectiveness in this area is limited by the current lack of guidance about the behaviour and characteristics of stars. We address this gap by combining a conceptual analysis with an empirical study involving 174 managers. Conceptually we examine the alignment of managers’ perceptions of outstanding performance with the well established task and contextual performance model and find this framework accounts for a core element in managers’ judgments about outstanding performers. However, a second, more qualitative approach finds that other dimensions including being self-directed, and a willingness to lead are also important. Our findings are consistent with a long-term trend toward identifying work effectiveness with highly discretionary, psychological and behavioural elements, and we consider the implications of this for the study and management of high level, individual effectiveness.

The relationship of entrepreneurial orientation, Vincentian values and economic and social performance in social enterprise

This study focuses on the managerial question “should social enterprises become more entrepreneurial?” It adapts the Covin and Slevin (1989) entrepreneurial orientation scale to measure the adoption of entrepreneurship by a social enterprise, and develops a scale that combines a Vincentian based focus to serve the poor with a propensity to take a more entrepreneurial approach toward business as a measure of a social value orientation (SVO).

Measurement as legitimacy versus legitimacy of measures : Performance evaluation of social enterprise

Purpose The purpose of this paper is to review the growing emphasis on quantifiable performance measures such as social return on investment (SROI) in third sector organisations – specifically, social enterprise – through a legitimacy theory lens. It then examines what social enterprises value (i.e. consider important) in terms of performance evaluation, using a case study approach. Design/methodology/approach Case studies involving interviews, documentary analysis, and observation, of three social enterprises at different life-cycle stages with different funding structures, were constructed to consider “what measures matter” from a practitioner's perspective. Findings Findings highlight a priority on quality outcomes and impacts in primarily qualitative terms to evaluate performance. Further, there is a noticeable lack of emphasis on financial measures other than basic access to financial resources to continue pursuing social goals. Social implications The practical challenges faced by social enterprises – many of which are small to medium sized – in evaluating performance and by implication organisational legitimacy are contrasted with measures such as SROI which are resource intensive and have inherent methodological limitations. Hence, findings suggest the limited and valuable resources of social enterprises would be better allocated towards documenting the actual outcomes and impacts as a first step, in order to evaluate social and financial performance in terms appropriate to each objective, in order to demonstrate organisational legitimacy. Originality/value Findings distinguish between processes which may hold symbolic legitimacy for select stakeholder groups, and processes which hold substantive, cognitive legitimacy for stakeholders more broadly, in the under-researched context of social enterprise.

Community night patrols in the Northern Territory : toward an improved performance and reporting framework

This Technical and Background Paper summarises the results of a Australian Government Attorney-General’s Department’s funded project. The project aimed to clarify the contribution of the community night patrol program in the Northern Territory (NT) to improving the community safety of Indigenous communities. The paper recommends an improved framework for monitoring performance and reporting. Community night patrols or similar services operate in many other areas of Australia and internationally. The paper concludes that the core business of community night patrols is (non-crisis) crime prevention not defacto policing. It also concludes that an unrecognised outcome of patrols is capturing and sharing local knowledge about community safety issues and solutions. Over time, community night patrols should focus on working with other services to reduce the need for repeat assistance to persons at risk and for risky incidents. The recently released Northern Territory Emergency Response Evaluation Report (2011) confirmed that communities and service providers surveyed largely support night patrols, but better data is required to more comprehensively assess their performance.

Do employees care about their relative income position? Behavioral evidence focusing on performance in professional team sport

Objective Do employees care about their relative (economic) position in comparison to their co-workers in an organization? And if so, does it raise or lower their performance? While the topic is widely discussed in the literature, behavioral evidence on these important questions is relatively rare. Methods This article explores the pay-performance relationship using a sports data set. The strength of analyzing such data is that sports tournaments take place in a very controlled environment that helps to isolate a relative income effect. Results Using two large unique data sets that cover 26 seasons in basketball and eight seasons in soccer (Bundesliga), we find considerable support for the idea that a relative income disadvantage is correlated with a decrease in individual performance. In addition, there does not seem to be any tolerance for income disparity based on the hope that such differences may signal that better times are ahead. Conclusions This suggests the need to consider the impact of the relative income position when designing pay-for-performance mechanisms within firms and teams.

On Presence, Collective Performance and Assumptions of Causality

The ways we assume, observe and model “presence” and its effects are the focus in this paper. Entities with selectively shared presences are the basis of any collective, and of attributions (such as “humorous”, “efficient” or “intelligent”). The subtleties of any joint presence can markedly influence potentials, perceptions and performance of the collective as demonstrated when a humorous tale is counterpoised with disciplined thought. Disciplines build on presences assumed known or knowable while fluid and interpretable presences pervade humor. Explorations in this paper allow considerations of collectives, causality and the philosophy of computing. Economics has long considered issues of collective action in ways circumscribed by assumptions about the presence of economic entities. Such entities are deemed rational but they are clearly not intelligent. To reach its potential, collective intelligence research needs more adequate considerations of alternate presences and their impacts.

Market turbulence, temporal orientation and firm performance

This study investigates the role of environmental dynamics (i.e., market turbulence) as a factor influencing an organisation’s top management temporal orientation, and the impact of temporal orientation on innovative and financial performance. Results show that firm’s operating in highly turbulent markets exhibit higher degrees of future orientation, as opposed to present orientation. Future-oriented (rather than present-oriented) firms also experience higher levels of both incremental and radical innovations, which in turn generate financial performance. The study highlights the important role of shared strategic mindset (which is contextually influenced) as a driving factor behind the firm innovative and financial performance.

A methodology for effective implementation of lean strategies and its performance evaluation in manufacturing organizations

Purpose – The purpose of this paper is to develop an effective methodology for implementing lean manufacturing strategies and a leanness evaluation metric using continuous performance measurement (CPM). Design/methodology/approach – Based on five lean principles, a systematic lean implementation methodology for manufacturing organizations has been proposed. A simplified leanness evaluation metric consisting of both efficiency and effectiveness attributes of manufacturing performance has been developed for continuous evaluation of lean implementation. A case study to validate the proposed methodology has been conducted and proposed CPM metric has been used to assess the manufacturing leanness. Findings – Proposed methodology is able to systematically identify manufacturing wastes, select appropriate lean tools, identify relevant performance indicators, achieve significant performance improvement and establish lean culture in the organization. Continuous performance measurement matrices in terms of efficiency and effectiveness are proved to be appropriate methods for continuous evaluation of lean performance. Research limitations/implications – Effectiveness of the method developed has been demonstrated by applying it in a real life assembly process. However, more tests/applications will be necessary to generalize the findings. Practical implications – Results show that applying the methods developed, managers can successfully identify and remove manufacturing wastes from their production processes. By improving process efficiency, they can optimize their resource allocations. Manufacturers now have a validated step by step methodology for successfully implementing lean strategies. Originality/value – According to the authors’ best knowledge, this is the first known study that proposed a systematic lean implementation methodology based on lean principles and continuous improvement techniques. Evaluation of performance improvement by lean strategies is a critical issue. This study develops a simplified leanness evaluation metric considering both efficiency and effectiveness attributes and integrates it with the lean implementation methodology.