Evaluating Conflicting Performance on Driver and Outcome Measures: The Effect of Strategy Maps

47 Pages Posted: 16 Aug 2010 Last revised: 4 Jun 2012

See all articles by Christian Mastilak

Christian Mastilak

Xavier University - Department of Accountancy

Linda J. Matuszewski

Northern Illinois University

Fabienne Miller

Worcester Polytechnic Institute

Alex Woods

College of William and Mary

Date Written: March 9, 2012

Abstract

This study examines how strategy maps affect balanced scorecard (BSC) evaluators’ assessments of managerial performance when there is inconsistent performance on the driver and outcome measures. We find that, when managers achieve target levels of performance on driver but not outcome measures, strategy maps do not influence the average level of evaluators’ bonuses, evaluations, or beliefs about the reasons for the inconsistent performance pattern. However, strategy maps influence how evaluators weight their beliefs when making bonus and evaluation decisions. Specifically, evaluators with strategy maps placed less weight on their beliefs about uncontrollable factors, and more weight on their beliefs about whether the poor outcomes were due to flawed strategies and misestimated time lags. Thus, strategy maps affect how evaluators implement control over the BSC strategy. These findings are significant, because the associations between beliefs and decisions will likely be communicated during performance evaluation, and these communications will likely affect future actions taken by the manager.

Keywords: Balanced scorecard, strategy map, performance measurement

JEL Classification: M41

Suggested Citation

Mastilak, Christian and Matuszewski, Linda J. and Miller, Fabienne and Woods, Alex, Evaluating Conflicting Performance on Driver and Outcome Measures: The Effect of Strategy Maps (March 9, 2012). Available at SSRN: https://ssrn.com/abstract=1659744 or http://dx.doi.org/10.2139/ssrn.1659744

Christian Mastilak

Xavier University - Department of Accountancy ( email )

223 Smith Hall
3718 Ledgewood Drive
Cincinnati, OH 45207
United States
513-745-3290 (Phone)

Linda J. Matuszewski

Northern Illinois University ( email )

1425 W. Lincoln Hwy
Dekalb, IL 60115-2828
United States
815-753-6379 (Phone)
815-753-8515 (Fax)

Fabienne Miller

Worcester Polytechnic Institute ( email )

Worcester, MA 01609
United States
508-831-6128 (Phone)

Alex Woods (Contact Author)

College of William and Mary ( email )

P.O. Box 8795
Williamsburg, VA 23185
United States

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