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The Business Values Scorecard within BAE Systems: The evolution of a performance measurement system

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  • Jazayeri, Mostafa
  • Scapens, Robert W.

Abstract

This paper explores the evolution of a performance measurement system in BAE Systems, a UK aerospace company. In 1994, the company embarked on a culture change project, which focused the organisation on five key values: performance, people, customers, partnerships, and innovation and technology. Tracing the mechanisms used to implement these values through the culture change project, the study describes the introduction of the “Business Values Scorecard” (BVS), which provided a way of translating the five key values into a coherent set of performance measures. The paper contrasts the BVS in BAE Systems with the balanced scorecard (BSC) of Kaplan and Norton, emphasising the importance of “coherence”, rather than cause-and-effect relationships. Furthermore, the BVS was not simply designed and then implemented; instead it evolved over an extended period of time. Finally, while it reflected the strategic vision of senior managers, the BVS was used as a tool to enable strategy to emerge from within the organisation, rather than as a mechanism for cascading down the hierarchy the strategy previously established by top-level managers. However, although the profitability of the company increased significantly over the period of the culture change project, many other things were also changing; consequently, it is not possible to isolate the effects on profits of introducing the BVS. Nevertheless, the belief within BAE Systems is that the BVS has made an important contribution to the recent success of the company.

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  • Jazayeri, Mostafa & Scapens, Robert W., 2008. "The Business Values Scorecard within BAE Systems: The evolution of a performance measurement system," The British Accounting Review, Elsevier, vol. 40(1), pages 48-70.
    • Handle: RePEc:eee:bracre:v:40:y:2008:i:1:p:48-70
    DOI: 10.1016/j.bar.2007.10.007
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    References listed on IDEAS

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    2. Sutheewasinnon, Prapaipim & Hoque, Zahirul & Nyamori, Robert Ochoki, 2016. "Development of a performance management system in the Thailand public sector: Isomorphism and the role and strategies of institutional entrepreneurs," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 40(C), pages 26-44.
    3. Hald, Kim Sundtoft & Mouritsen, Jan, 2018. "The evolution of performance measurement systems in a supply chain: A longitudinal case study on the role of interorganisational factors," International Journal of Production Economics, Elsevier, vol. 205(C), pages 256-271.
    4. Mostafa Jazayeri & Danture Wickramsinghe & Tharusha Gooneratne, 2011. "Convergence versus divergence of performance measurement systems," Qualitative Research in Accounting & Management, Emerald Group Publishing Limited, vol. 8(3), pages 292-314, August.
    5. Ulf Diefenbach & Andreas Wald & Ronald Gleich, 2018. "Between cost and benefit: investigating effects of cost management control systems on cost efficiency and organisational performance," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 29(1), pages 63-89, March.
    6. Patrizia Di Tullio & Matteo La Torre & Diego Valentinetti & Michele A. Rea, 2021. "Toward performance measurement systems based on business models," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2021(suppl. 1), pages 97-122.

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