How organizational culture influences performance measurement systems in SMEs

Abstract

Purpose Literature highlights the impact of culture on managerial processes in general and the performance measurement system (PMS) in particular. However, understanding how organizational culture (OC) influences the PMS remains a challenge, especially in SMEs as in these companies the studies are very limited. The purpose of this paper is to investigate how OC influences PMSs in manufacturing SMEs. Design/methodology/approach To achieve the above purpose, a case study approach has been adopted. Four manufacturing SMEs with heterogeneous OC were investigated by means of companies’ documents reviews, participant observations and semi-structured interviews. A conceptual framework based on the competing value framework proposed by Cameron and Quinn (1999) and the PMS typology proposed by Garengo (2009) has been used to investigate the impact of OC on PMS. Findings According to the results, OC has a huge impact on PMS in manufacturing SMEs. The dimensions of “internal/external focus” influence strategy formalization, monitoring of the external environment and performance review. The “flexibility/control” dimensions influence the adoption of the balanced (or unbalanced) set of performance measures a company uses. Originality/value This paper contributes to clarifying how OC influences PMSs in manufacturing SMEs. Moreover, the study of interplay between flexibility/control dimensions and internal/external dimensions supports the identification of three theoretical propositions and four PMS types related to the four different OCs identified by Cameron and Quinn (1999).

How do employees learn from performance measures? Evidence from a local government entity

“…In comparison with these findings, a search of the management and accounting literature reveals that much of the research undertaken has been searching for generic or generalisable rather than individual or organisation‐specific findings. We suggest here that the effectiveness of an individual’s learning is contextually and culturally specific (Jardioui et al ., 2019). Yet, the organisational member’s learning is specific to the formal and informal interactions and interpretations of the episodic experiences they encounter with the organisational performance measurement system.…”

“…Our review of the empirical literature in accounting that links the phenomenon of organisational learning and performance measurement reveals that it is a growing body of literature but still a sparse field of enquiry (see Kloot, 1997; Van Helden et al ., 2001; Rouse et al ., 2002; Chenhall, 2005; Henri, 2006; de Waal and Counet, 2009; Adonis, 2018; Jardioui et al ., 2019). To Neely and Bourne (2000), the challenge of the twenty‐first century is 'how do we extract the maximum value from our performance measurement data?'…”

“…Over the past 50 years, organisational learning as a research field has grown significantly (Argyris, 1977; Askim et al ., 2008; de Waal and Counet, 2009; Li et al ., 2009; Rashman et al ., 2009; Argote, 2011; Argote and Miron‐Spektor, 2011; Easterby‐Smith and Lyles, 2011; Popova‐Nowak and Cseh, 2015; Adonis, 2018; Jardioui et al ., 2019). Researchers have acknowledged the importance of linking individual, group and organisational levels of learning in an organisational setting.…”

“…For the current study, positioned in the local government sector, influences in the external environment include state and local government laws, regulations and policies, and parliamentary overseeing regulatory bodies such as offices of the federal and state Auditor‐Generals and public accounts committees (Hoque and Thiagarajah, 2015). Influences in the internal environment may include unique characteristics of the organisation such as organisational culture (Fiol and Lyles, 1985; Cook and Yanow, 1993; Jardioui et al ., 2019), structural arrangements (Fiol and Lyles, 1985) and the interactions of individuals within an organisation (Strauss and Corbin, 1990). The contribution of this objective is to identify specific influences that emerge as relevant to learning within a particular context concerning the performance measures.

Research objective 2.

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Mediating role of strategic orientations in the relationship between entrepreneurial orientation and performance of Saudi SMEs

“…Particularly in advanced countries, SMEs are regarded as the key drivers of competition, fuelling jobs and promoting financial growth (Ndubisi et al, 2020). SME strategies play a critical role in advancing the corporate mission, maintaining vision and establishing the competitive advantages of a company (Jardioui et al, 2019). These businesses do not need to devote massive marketing budgets or pursue large resources to gain competition.…”