IDEAS home Printed from https://ideas.repec.org/a/bla/acctfi/v63y2023i4p4357-4373.html
   My bibliography  Save this article

The balanced scorecard: Do managers need a strategy map when evaluating performance?

Author

Listed:
  • Kerry A. Humphreys

Abstract

Prior research establishes a judgemental bias towards common measures when managers evaluate performance using the balanced scorecard. In an experimental study, I examine the role of a strategy map when evaluating performance in a boundary condition setting for this bias with performance measures strategically linked and both narrative strategy information and a strategy map provided. I manipulate the presence of a strategy map and find that managers who receive a strategy map develop greater strategic causal relationship knowledge when evaluating performance than managers who receive narrative strategy information only. Additional analyses indicate the bias is absent from managers' judgements in both conditions.

Suggested Citation

  • Kerry A. Humphreys, 2023. "The balanced scorecard: Do managers need a strategy map when evaluating performance?," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 63(4), pages 4357-4373, December.
    • Handle: RePEc:bla:acctfi:v:63:y:2023:i:4:p:4357-4373
    DOI: 10.1111/acfi.13097
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/acfi.13097
    Download Restriction: no
    File URL: https://libkey.io/10.1111/acfi.13097?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Birnberg, Jacob G. & Shields, Michael D., 1984. "The role of attention and memory in accounting decisions," Accounting, Organizations and Society, Elsevier, vol. 9(3-4), pages 365-382, October.
    2. Wong-On-Wing, Bernard & Guo, Lan & Li, Wei & Yang, Dan, 2007. "Reducing conflict in balanced scorecard evaluations," Accounting, Organizations and Society, Elsevier, vol. 32(4-5), pages 363-377.
    3. Ittner, Christopher D. & Larcker, David F. & Randall, Taylor, 2003. "Performance implications of strategic performance measurement in financial services firms," Accounting, Organizations and Society, Elsevier, vol. 28(7-8), pages 715-741.
    4. Hall, Matthew, 2016. "Realising the richness of psychology theory in contingency-based management accounting research," LSE Research Online Documents on Economics 64960, London School of Economics and Political Science, LSE Library.
    5. Libby, Robert & Bloomfield, Robert & Nelson, Mark W., 2002. "Experimental research in financial accounting," Accounting, Organizations and Society, Elsevier, vol. 27(8), pages 775-810, November.
    6. Hoque, Zahirul, 2014. "20 years of studies on the balanced scorecard: Trends, accomplishments, gaps and opportunities for future research," The British Accounting Review, Elsevier, vol. 46(1), pages 33-59.
    7. Kerry A. Humphreys & Ken T. Trotman, 2022. "Judgment and decision making research on CSR reporting in the COVID‐19 pandemic environment," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(1), pages 739-765, March.
    8. Anne M. Farrell & Joan Luft & Michael D. Shields, 2007. "Accuracy in Judging the Nonlinear Effects of Cost and Profit Drivers," Contemporary Accounting Research, John Wiley & Sons, vol. 24(4), pages 1139-1169, December.
    9. Steve Salterio, 2012. "Balancing the scorecard through academic accounting research: opportunity lost?," Journal of Accounting & Organizational Change, Emerald Group Publishing Limited, vol. 8(4), pages 458-474, October.
    10. Yasheng Chen & Johnny Jermias & Tota Panggabean, 2016. "The Role of Visual Attention in the Managerial Judgment of Balanced‐Scorecard Performance Evaluation: Insights from Using an Eye‐Tracking Device," Journal of Accounting Research, Wiley Blackwell, vol. 54(1), pages 113-146, March.
    11. Bonner, Sarah E., 1994. "A model of the effects of audit task complexity," Accounting, Organizations and Society, Elsevier, vol. 19(3), pages 213-234, April.
    12. Lipe, Marlys Gascho & Salterio, Steven, 2002. "A note on the judgmental effects of the balanced scorecard's information organization," Accounting, Organizations and Society, Elsevier, vol. 27(6), pages 531-540, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dalla Via, Nicola & Perego, Paolo & van Rinsum, Marcel, 2019. "How accountability type influences information search processes and decision quality," Accounting, Organizations and Society, Elsevier, vol. 75(C), pages 79-91.
    2. Geoffrey Bartlett & Eric Johnson & Philip Reckers, 2014. "Accountability and Role Effects in Balanced Scorecard Performance Evaluations When Strategy Timeline Is Specified," European Accounting Review, Taylor & Francis Journals, vol. 23(1), pages 143-165, May.
    3. Wynder, Monte, 2010. "Chemico: Evaluating performance based on the Balanced Scorecard," Journal of Accounting Education, Elsevier, vol. 28(3), pages 221-236.
    4. Borozan, Miloš & Loreta, Cannito & Riccardo, Palumbo, 2022. "Eye-tracking for the study of financial decision-making: A systematic review of the literature," Journal of Behavioral and Experimental Finance, Elsevier, vol. 35(C).
    5. Victor S. Maas & Niels Verdoorn, 2017. "The effects of performance report layout on managers’ subjective evaluation judgments," Accounting and Business Research, Taylor & Francis Journals, vol. 47(7), pages 731-751, November.
    6. Robert M. Gillenkirch & Achim Hendriks & Susanne A. Welker, 2014. "Effects of Executive Compensation Complexity on Investor Behaviour in an Experimental Stock Market," European Accounting Review, Taylor & Francis Journals, vol. 23(4), pages 625-645, December.
    7. Krumwiede, Kip R. & Swain, Monte R. & Thornock, Todd A. & Eggett, Dennis L., 2013. "The effects of task outcome feedback and broad domain evaluation experience on the use of unique scorecard measures," Advances in accounting, Elsevier, vol. 29(2), pages 205-217.
    8. Ralph Kober & Deryl Northcott, 2021. "Testing cause‐and‐effect relationships within a balanced scorecard," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 61(S1), pages 1815-1849, April.
    9. Carmona, Salvador & Iyer, Govind & Reckers, Philip M.J., 2014. "Performance evaluation bias: A comparative study on the role of financial fixation, similarity-to-self and likeability," Advances in accounting, Elsevier, vol. 30(1), pages 9-17.
    10. LIN, Zhijun & YU, Zengbiao & ZHANG, Liqun, 2014. "Performance outcomes of balanced scorecard application in hospital administration in China," China Economic Review, Elsevier, vol. 30(C), pages 1-15.
    11. Chadi Joseph Khalifeh & Prabhu Sivabalan, 2014. "An Experimental Study on the Effect of Budget Information on Balanced Scorecard Preparer Individual Learning," Australian Accounting Review, CPA Australia, vol. 24(1), pages 39-52, March.
    12. Hoque, Zahirul, 2014. "20 years of studies on the balanced scorecard: Trends, accomplishments, gaps and opportunities for future research," The British Accounting Review, Elsevier, vol. 46(1), pages 33-59.
    13. Marco Haid & Sabine Graschitz & Peter Heimerl, 2019. "Error Reports in the Light of Error Management Climate, Task Complexity and Personnel Composition," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 12(3), pages 14-23, December.
    14. Lisa-Marie Wibbeke & Maik Lachmann, 2020. "Psychology in management accounting and control research: an overview of the recent literature," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 31(3), pages 275-328, September.
    15. Rajib Narayan Sahu & Lalatendu Kesari Jena & Subhas Chandra Parida, 2014. "Performance Management System as a Predictor of Organizational Effectiveness: Insights from Indian Manufacturing Industries," Jindal Journal of Business Research, , vol. 3(1-2), pages 137-152, June.
    16. Grafton, Jennifer & Lillis, Anne M. & Widener, Sally K., 2010. "The role of performance measurement and evaluation in building organizational capabilities and performance," Accounting, Organizations and Society, Elsevier, vol. 35(7), pages 689-706, October.
    17. Francesca Francioli, 2018. "Strategic performance management systems in Italian banks. A research note," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2018(2), pages 155-178.
    18. Solomon, Ira & Trotman, Ken T., 2003. "Experimental judgment and decision research in auditing: the first 25 years of AOS," Accounting, Organizations and Society, Elsevier, vol. 28(4), pages 395-412, May.
    19. Maria José Gomes & António Sousa & Jorge Novas & Ricardo Vinícius Dias Jordão, 2021. "Environmental Sustainability in Viticulture as a Balanced Scorecard Perspective of the Wine Industry: Evidence for the Portuguese Region of Alentejo," Sustainability, MDPI, vol. 13(18), pages 1-18, September.
    20. Pérez Granero, Luis & Guillén, Manuel & Bañón-Gomis, Alexis J., 2017. "Influencia de los factores de contingencia en el desarrollo del cuadro de mando integral y su asociación con un rendimiento mejor. El caso de las empresas españolas," Revista de Contabilidad - Spanish Accounting Review, Elsevier, vol. 20(1), pages 82-94.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:acctfi:v:63:y:2023:i:4:p:4357-4373. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/aaanzea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.