The role of causal links in performance measurement models

Abstract Purpose: Several well-known managerial accounting performance measurement models rely on causal assumptions. Whilst users of the models express satisfaction and link them with improved organizational performance, academic research, of the realworld applications, shows few reliable statistical associations. This paper provides a discussion on the"problematic" of causality in a performance measurement setting. Design/methodology/approach: This is a conceptual study based on an analysis and synthesis of the literature from managerial accounting, organizational theory, strategic management and social scientific causal modelling. Findings: The analysis indicates that dynamic, complex and uncertain environments may challenge any reliance upon valid causal models. Due to cognitive limitations and judgmental biases, managers may fail to trace correct cause-and-effect understanding of the value creation in their organizations. However, even lacking this validity, causal models can support strategic learning and perform as organizational guides if they are able to mobilize managerial action. Research limitations/implications: Future research should highlight the characteristics necessary for elaboration of convincing and appealing causal models and the social process of their construction. Practical implications: Managers of organizations using causal models should be clear on the purposes of their particular models and their limitations. In particular, difficulties are observed in specifying detailed cause and effect relations and their potential for communicating and directing attention. They should therefore construct their models to suit the particular purpose envisaged. Originality/value: This paper provides an interdisciplinary and holistic view on the issue of causality in managerial accounting models.

Measuring sustained superior performance at the firm level

This paper proposes a two-dimensional Strategic Performance Measure (SPM) to evaluate the achievement of sustained superior performance. This proposal builds primarily on the fact that, under the strategic management perspective, a firm's prevalent objective is the pursuit of sustained superior performance. Three basic conceptual dimensions stem from this objective: relativity, sign dependence, and dynamism. These are the foundations of the SPM, which carries out a separate evaluation of the attained superior performance and of its sustainability over time. In contrast to existing measures of performance, the SPM provides: (i) a dynamic approach by considering the progress or regress in performance over time, and (ii) a cardinal measurement of performance differences and its changes over time. The paper also proposes an axiomatic framework that a measure of strategic performance should comply with to be theoretically and managerially sound. Finally, an empirical illustration of the Spanish banking sector during 1987-1999 is herein provided by discussing some relevant cases.

Measuring sustained superior performance at the firm level

This paper proposes a two-dimensional Strategic Performance Measure (SPM) to evaluate the achievement of sustained superior performance. This proposal builds primarily on the fact that, under the strategic management perspective, a firm's prevalent objective is the pursuit of sustained superior performance. Three basicconceptual dimensions stem from this objective: relativity, sign dependence, and dynamism. These are the foundations of the SPM, which carries out a separate evaluation of the attained superior performance and of its sustainability over time. In contrast to existing measures of performance, the SPM provides: (i) a dynamic approach by considering the progress or regress in performance over time, and (ii) a cardinal measurement of performance differences and its changes over time. The paper also proposes an axiomatic framework that ameasure of strategic performance should comply with to be theoretically and managerially sound. Finally, anempirical illustration of the Spanish banking sector during 1987-1999 is herein provided by discussing some relevant case

Bibliotecaris de recerca en un entorn virtual: noves habilitats, nous serveis

En aquest article es posen de manifest tant les noves funcions adquirides pels bibliotecaris de recerca de la UOC com les noves competències que requereix aquest perfil professional, partint de l'experiència de la Biblioteca Virtual (BV) de la UOC. En un context de creació d'unitats de bibliometria, la BV de la UOC també ha trobat la seva manera d'integrar-se dins la Universitat a través dels seus estudis bibliomètrics i altres serveis de suport a la recerca. Un grup de bibliotecaris de recerca dóna suport als investigadors des de l'inici del procés de recerca fins a l'avaluació de la seva producció científica i, d'altra banda, també dóna suport en l'anàlisi de dades bibliomètriques per a la presa de decisions estratègiques de la Universitat.

Bibliotecarios de investigación en un entorno virtual: nuevas habilidades, nuevos servicios

En aquest article es posen de manifest tant les noves funcions adquirides pels bibliotecaris de recerca de la UOC com les noves competències que requereix aquest perfil professional, partint de l'experiència de la Biblioteca Virtual (BV) de la UOC. En un context de creació d'unitats de bibliometria, la BV de la UOC també ha trobat la seva manera d'integrar-se dins la Universitat a través dels seus estudis bibliomètrics i altres serveis de suport a la recerca. Un grup de bibliotecaris de recerca dóna suport als investigadors des de l'inici del procés de recerca fins a l'avaluació de la seva producció científica i, d'altra banda, també dóna suport en l'anàlisi de dades bibliomètriques per a la presa de decisions estratègiques de la Universitat.

Research librarians in a virtual environment : new skills, new services

This paper highlights both the new functions taken on by UOC research librarians and the new skills that this professional profile requires, based on the experience of the UOC Virtual Library. By setting up a series of bibliometric units, the Library has been able to integrate itself into the University through bibliometric studies and other research support services. A group of research librarians provides support to researchers from the start of the research process to the assessment of their scientific output. They also provide support for the University's strategic decision-making through the analysis of bibliometric data.

Research librarians in a virtual environment : new skills, new services

This poster highlights both the new functions taken on by UOC research librarians and the new skills that this professional profile requires, based on the experience of the UOC Virtual Library. By setting up a series of bibliometric units, the Library has been able to integrate itself into the University through bibliometric studies and other research support services. A group of research librarians provides support to researchers from the start of the research process to the assessment of their scientific output. They also provide support for the University's strategic decision-making through the analysis of bibliometric data.

Sistema de indicadores para la gestión sostenible de un destino turístico: aplicación a la Costa Brava centro

Strategic management is based upon a performance measurement system that allows gearing decision making towards accomplishing the established objectives.In a changing economic situation, the measurement of the effects of tourism is fundamental in order to know the efficiency and sustainability of that industry and of the territory in which takes place its activity. We propose a performance measurement system for the sustainable management of a tourism destination, so it will support the adoption of public policies and their follow-up, and as an instrument that will promote the responsible participation of the stakeholders with stakes in the destination. In accordance with the guidelines of the Agenda for a sustainable and competitive European tourism, we design a system based on the identification of the axes over which hinges the success of the management of tourism destinations, taking into account the long-term sustainability of this activity. We position the performance measurement system, and especially the balanced scorecard, as a support tool for the strategic planning of destinations. To the extent that this is possible, the performance measures are selected and structured according to the patterns of the balanced scorecard. Finally, we apply the conceptual model to the central Costa Brava

Behavioral aspects of investment fund's markets: are good managers lucky or skilled?

It is generally accepted that financial markets are efficient in the long run a lthough there may be some deviations in the short run. It is also accepted that a good portfolio manager is the one who beats the market persistently along time, this type of manager could not exist if markets were perfectly efficient According to this in a pure efficient market we should find that managers know that they can not beat the market so they would undertake only pure passive management strategies. Assuming a certain degree of inefficiency in the short run, a market may show some managers who tr y to beat the market by undertaking active strategies. From Fama’s efficient markets theory we can state that these active managers may beat the market occasionally although they will not be able to enhance significantly their performance in the long run. On the other hand, in an inefficient market it would be expected to find a higher level of activity related with the higher probability of beating the market. In this paper we follow two objectives: first, we set a basis to analyse the level of efficiency in an asset invest- ment funds market by measuring performance, strategies activity and it’s persistence for a certain group of funds during the period of study. Second, we analyse individual performance persistence in order to determine the existence of skilled managers. The CAPM model is taken as theoretical background and the use of the Sharpe’s ratio as a suitable performance measure in a limited information environment leads to a group performance measurement proposal. The empiri- cal study takes quarterly data from 1999-2007 period, for the whole population of the Spanish asset investment funds market, provided by the CNMV (Comisión Nacional del Mercado de Valores). This period of study has been chosen to ensure a wide enough range of efficient market observation so it would allow us to set a proper basis to compare with the following period. As a result we develop a model that allows us to measure efficiency in a given asset mutual funds market, based on the level of strategy’s activity undertaken by managers. We also observe persistence in individual performance for a certain group of funds

Moderating effects of management control systems and innovation on performance. Simple methods for correcting the effects of measurement error for interaction effects in small samples

In the accounting literature, interaction or moderating effects are usually assessed by means of OLS regression and summated rating scales are constructed to reduce measurement error bias. Structural equation models and two-stage least squares regression could be used to completely eliminate this bias, but large samples are needed. Partial Least Squares are appropriate for small samples but do not correct measurement error bias. In this article, disattenuated regression is discussed as a small sample alternative and is illustrated on data of Bisbe and Otley (in press) that examine the interaction effect of innovation and style of use of budgets on performance. Sizeable differences emerge between OLS and disattenuated regression

Assessing the structural change of strategic mobility: determinants under hypercompetitive environments

The primary purpose of this exploratory empirical study is to examine the structural stability of a limited number of alternative explanatory factors of strategic change. On the basis of theoretical arguments and prior empirical evidence from two traditional perspectives, we propose an original empirical framework to analyse whether these potential explanatory factors have remained stable over time in a highly turbulent environment. This original question is explored in a particular setting: the population of Spanish private banks. The firms of this industry have experienced a high level of strategic mobility as a consequence of fundamental changes undergone in their environmental conditions over the last two decades (mainly changes related to the new banking and financial regulation process). Our results consistently support that the effect of most explanatory factors of strategic mobility considered did not remain stable over the whole period of analysis. From this point of view, the study sheds new light on major debates and dilemmas in the field of strategy regarding why firms change their competitive patterns over time and, hence, to what extent the "contextdependency" of alternative views of strategic change as their relative validation can vary over time for a given population. Methodologically, this research makes two major contributions to the study of potential determinants of strategic change. First, the definition and measurement of strategic change employing a new grouping method, the Model-based Cluster Method or MCLUST. Second, in order to asses the possible effect of determinants of strategic mobility we have controlled the non-observable heterogeneity using logistic regression models for panel data.

Single period Markowitz portfolio selection, performance gauging and duality: a variation on Luenberger's shortage function

Markowitz portfolio theory (1952) has induced research into the efficiency of portfolio management. This paper studies existing nonparametric efficiency measurement approaches for single period portfolio selection from a theoretical perspective and generalises currently used efficiency measures into the full mean-variance space. Therefore, we introduce the efficiency improvement possibility function (a variation on the shortage function), study its axiomatic properties in the context of Markowitz efficient frontier, and establish a link to the indirect mean-variance utility function. This framework allows distinguishing between portfolio efficiency and allocative efficiency. Furthermore, it permits retrieving information about the revealed risk aversion of investors. The efficiency improvement possibility function thus provides a more general framework for gauging the efficiency of portfolio management using nonparametric frontier envelopment methods based on quadratic optimisation.

An analysis of strategic paths through the decomposition of total factor productivity: the case of Spanish savings banks

The Spanish savings banks attracted quite a considerable amount of interest within the scientific arena, especially subsequent to the disappearance of the regulatory constraints during the second decade of the 1980s. Nonetheless, a lack of research identified with respect to mainstream paths given by strategic groups, and the analysis of the total factor productivity. Therefore, on the basis of the resource-based view of the firm and cluster analysis, we make use of changes in structure and performance ratios in order to identify the strategic groups extant in the sector. We attain a threeways division, which we link with different input-output specifications defining strategic paths. Consequently, on the basis of these three dissimilar approaches we compute and decompose a Hicks-Moorsteen total factor productivity index. Obtained results put forward an interesting interpretation under a multi-strategic approach, together with the setbacks of employing cluster analysis within a complex strategic environment. Moreover, we also propose an ex-post method of analysing the outcomes of the decomposed total factor productivity index that could be merged with non-traditional techniques of forming strategic groups, such as cognitive approaches.

Organizational configurations of strategic choices and strategic management accounting

This is the first study to adopt a configurational paradigm in an investigation of strategic management accounting (SMA) adoption. The study examines the alignment and effectiveness of strategic choice and strategic management accounting (SMA) system design configurations. Six configurations were derived empirically by deploying a cluster analysis of data collected from a sample of 193 large Slovenian companies. The first four clusters appear to provide some support for the central configurational proposition that higher levels of vertical and horizontal configurational alignments are associated with higher levels of performance. Evidence that contradicts the theory is also apparent, however, as the remaining two clusters exhibit high degrees of SMA vertical and horizontal alignment, but low performance levels. A particular contribution of the paper concerns its demonstration of the way that the configurational paradigm can be operationalised to examine management accounting phenomena and the nature of management accounting insights that can derive from applying the approach.

The Network Company in Catalonia : ICT, Productivity, Competitiveness, Salaries and Performance in Catalonia's Companies. Research report (synthesis document)

Resum en anglès del projecte de recerca L'empresa xarxa a Catalunya. TIC, productivitat, competitivitat, salaris i beneficis a l'empresa catalana té com a objectiu principal constatar que la consolidació d'un nou model estratègic, organitzatiu i d'activitat empresarial, vinculat amb la inversió i l'ús de les TIC (o empresa xarxa), modifica substancialment els patrons de comportament dels resultats empresarials, en especial la productivitat, la competitivitat, les retribucions dels treballadors i el benefici. La contrastació empírica de les hipòtesis de treball l'hem feta per mitjà de les dades d'una enquesta a una mostra representativa de 2.038 empreses catalanes. Amb la perspectiva de l'impacte de la inversió i l'ús de les TIC no s'aprecia una relació directa entre els processos d'innovació digital i els resultats de l'activitat de l'empresa catalana. En aquest sentit, hem hagut de segmentar el teixit productiu català per a buscar les organitzacions en què el procés de coinnovació tecnològica digital i organitzativa és més present i en què la intensitat de l'ús del coneixement és un recurs molt freqüent per a poder copsar impactes rellevants en els principals resultats empresarials. Això és així perquè l'economia catalana, avui, presenta una estructura productiva dual.