IDEAS home Printed from https://ideas.repec.org/p/gtr/gatrjs/jber166.html
   My bibliography  Save this paper

What Drives the Institutionalization of Performance Measurement Systems in Indonesian Local Government?

Author

Listed:
  • Mirna Amirya

    (Faculty of Economics and Business, Universitas Airlangga, Indonesia Author-2-Name: Shuo Seah Author-2-Workplace-Name: College of Public Administration, Huazhong University of Science and Technology, 430074, Wuhan, China & Faculty of Economics & Business, Brawijaya University, 65145, Malang, East Java, Indonesia Author-3-Name: Qiao Wang Author-3-Workplace-Name: College of Public Administration, Huazhong University of Science and Technology, 430074, Wuhan, China Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)

Abstract

Objective � The objective of this paper is to explore and understand the motivators of institutionalization of Performance Measurement Systems (PMS) in the Indonesian Local Government (ILG), particularly in the Batu municipality presenting the performance paradoxes. Performance accountability issues have been encouraging the Batu municipality to implement PMS since the beginning of the 2000s. Methodology/Technique � The theoretical framework and interpretation of this study are adopted from the institutional theory (coercive, mimetic, normative, and allomorphism) which is used to analyze the phenomenon. The researchers employ a single case study to scrutinize the motivators of institutionalization by elaborating on document analysis conducted from the interviews of 10 employees in a different range of management levels (top, middle, and lower). Findings � The results of this study reveal that exogenous (coercive, mimetic and normative) and endogenous (allomorphism) drivers encourage the institutionalization of PMS in the Batu municipality with coercive pressure as a major driver and allomorphism as a mere ceremonial driver (rather than an instrument). Novelty � The practical implications of this study can be used to improve the PMS process and the quality of performance reporting in the Batu municipality and in other local governments. This paper is also expected to fill the gap in existing literature on the implementation of PMS within a developing country (in this case, Indonesia). Type of Paper: Empirical Paper.

Suggested Citation

  • Mirna Amirya, 2019. "What Drives the Institutionalization of Performance Measurement Systems in Indonesian Local Government?," GATR Journals jber166, Global Academy of Training and Research (GATR) Enterprise.
    • Handle: RePEc:gtr:gatrjs:jber166
    as

    Download full text from publisher

    File URL: http://gatrenterprise.com/GATRJournals/pdf_files/JBER%20Vol%204(1)/3.Mirna%20Amirya.pdf
    Download Restriction: http://gatrenterprise.com/GATRJournals/online_submission.html
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Cavalluzzo, Ken S. & Ittner, Christopher D., 2004. "Implementing performance measurement innovations: evidence from government," Accounting, Organizations and Society, Elsevier, vol. 29(3-4), pages 243-267.
    2. Joanne M. Lye, 2006. "Performance Measurement in the Public Sector: A Clarification and Agenda for Research," Australian Accounting Review, CPA Australia, vol. 16(39), pages 25-33, July.
    3. Rusdi Akbar & Robyn Ann Pilcher & Brian Perrin, 2015. "Implementing performance measurement systems," Qualitative Research in Accounting & Management, Emerald Group Publishing Limited, vol. 12(1), pages 3-33, April.
    4. Scapens, Robert W., 2006. "Understanding management accounting practices: A personal journey," The British Accounting Review, Elsevier, vol. 38(1), pages 1-30.
    5. Christopher Marquis & András Tilcsik, 2016. "Institutional Equivalence: How Industry and Community Peers Influence Corporate Philanthropy," Organization Science, INFORMS, vol. 27(5), pages 1325-1341, October.
    6. Robyn Pilcher & Graeme Dean, 2009. "Consequences and Costs of Financial Reporting Compliance for Local Government," European Accounting Review, Taylor & Francis Journals, vol. 18(4), pages 725-744.
    7. Yi Ma & Mike Tayles, 2009. "On the emergence of strategic management accounting: An institutional perspective," Accounting and Business Research, Taylor & Francis Journals, vol. 39(5), pages 473-495.
    8. Lili‐Anne Kihn, 2010. "Performance outcomes in empirical management accounting research," International Journal of Productivity and Performance Management, Emerald Group Publishing Limited, vol. 59(5), pages 468-492, June.
    9. Lippi, Andrea, 2000. "One theory, many practices. Institutional allomorphism in the managerialist reorganization of Italian local governments," Scandinavian Journal of Management, Elsevier, vol. 16(4), pages 455-477, December.
    10. Otley, Dt, 1978. "Budget Use And Managerial Performance," Journal of Accounting Research, Wiley Blackwell, vol. 16(1), pages 122-149.
    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. Adam Maiga & Anders Nilsson & Fred Jacobs, 2014. "Assessing the impact of budgetary participation on budgetary outcomes: the role of information technology for enhanced communication and activity-based costing," Metrika: International Journal for Theoretical and Applied Statistics, Springer, vol. 25(1), pages 5-32, September.
    2. Walid Cheffi, 2008. "Etude Des Roles De La Comptabilite De Gestion Pour Les Managers : Le Cas D'Un Grand Groupe Automobile," Post-Print halshs-00522472, HAL.
    3. Dunk, Alan S., 2007. "Innovation budget pressure, quality of IS information, and departmental performance," The British Accounting Review, Elsevier, vol. 39(2), pages 115-124.
    4. Sofyani Hafiez, 2018. "Does Performance-Based Budgeting Have a Correlation with Performance Measurement System? Evidence from Local Government in Indonesia," Foundations of Management, Sciendo, vol. 10(1), pages 163-176, September.
    5. Marco Morelli & Francesca Lecci, 2014. "Management control systems (MCS) change and the impact of top management characteristics: the case of healthcare organisations," Metrika: International Journal for Theoretical and Applied Statistics, Springer, vol. 24(3), pages 267-298, January.
    6. Elmassri, Moataz Moamen & Harris, Elaine Pamela & Carter, David Bernard, 2016. "Accounting for strategic investment decision-making under extreme uncertainty," The British Accounting Review, Elsevier, vol. 48(2), pages 151-168.
    7. Prem Lal Joshi & Wayne G. Bremser & Ashutosh Deshmukh & Rajesh Kumar, 2011. "Diffusion of Management Accounting Practices in Gulf Cooperation Council Countries," Accounting Perspectives, John Wiley & Sons, vol. 10(1), pages 23-53, March.
    8. Nirmala Nath & Umesh Sharma, 2014. "Performance Management Systems in the Public Housing Sector: Dissemination to Diffusion," Australian Accounting Review, CPA Australia, vol. 24(1), pages 2-20, March.
    9. Abdel-Maksoud, Ahmed & Cheffi, Walid & Ghoudi, Kilani, 2016. "The mediating effect of shop-floor involvement on relations between advanced management accounting practices and operational non-financial performance indicators," The British Accounting Review, Elsevier, vol. 48(2), pages 169-184.
    10. Vasilii Erokhin & Dmitry Endovitsky & Alexey Bobryshev & Natalia Kulagina & Anna Ivolga, 2019. "Management Accounting Change as a Sustainable Economic Development Strategy during Pre-Recession and Recession Periods: Evidence from Russia," Sustainability, MDPI, vol. 11(11), pages 1-23, June.
    11. Charpentier, Claes, 1998. "Budgetary Participation in a Public Service Organization," SSE/EFI Working Paper Series in Business Administration 3, Stockholm School of Economics.
    12. Prabhu Sivabalan & Peter Booth & Teemu Malmi & David A. Brown, 2009. "An exploratory study of operational reasons to budget," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 49(4), pages 849-871, December.
    13. Francesca Francioli & Alberto Quagli, 2021. "Management accounting change and the rise of Vespa (1884-1965)," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2021(suppl. 2), pages 313-338.
    14. Sèna John-Ahyee, 2012. "La stabilité des activités des contrôleurs de gestion est-elle paradoxale?," Post-Print hal-00690976, HAL.
    15. Alexey Bobryshev & Lyubov Chaykovskaya & Vasilii Erokhin & Anna Ivolga, 2023. "Sustaining Growth or Boosting Profit: Accounting Tools under Process-Based Management in a Transition Economy," JRFM, MDPI, vol. 16(2), pages 1-14, February.
    16. Jagdish PATHAK & Abdulkadir HUSSEIN & Ram SRIRAM & S. Ejaz AHMED, 2010. "On Measuring the Criticality of Various Variables and Processes in Organization Information Systems: Proposed Methodological Procedure," Informatica Economica, Academy of Economic Studies - Bucharest, Romania, vol. 14(2), pages 5-18.
    17. repec:thr:techub:1009:y:2020:i:1:p:1-19 is not listed on IDEAS
    18. Enrico Bracci & Mouhcine Tallaki, 2013. "Socio-environmental reporting trends in the Italian local government: Thrive or wither?," FINANCIAL REPORTING, FrancoAngeli Editore, vol. 2013(2), pages 27-46.
    19. Alexander Mohr & Christian Schumacher, 2019. "The Contingent Effect of Patriotic Rhetoric on Firm Performance," Strategy Science, INFORMS, vol. 4(2), pages 94-110, June.
    20. Chong Lau & Christen Buckland, 2000. "Budget emphasis, participation, task difficulty and performance: the effect of diversity within culture," Accounting and Business Research, Taylor & Francis Journals, vol. 31(1), pages 37-55.
    21. Rozzani, Nabilah & Mohamed, Intan Salwani & Syed Yusuf, Sharifah Norzehan, 2017. "Risk management process: Profiling of islamic microfinance providers," Research in International Business and Finance, Elsevier, vol. 41(C), pages 20-27.

    More about this item

    JEL classification:

    • P47 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Performance and Prospects
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation
    • P49 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Other

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:gtr:gatrjs:jber166. 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: Prof. Dr. Abd Rahim Mohamad (email available below). General contact details of provider: http://gatrenterprise.com .

    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.