The contingency of performance measurement systems in Moroccan public institutions and enterprises

Abstract

Purpose In the framework of contingency theory, this paper aims to study the contextual variables that influence the variety of the contents of a performance measurement system, specifically the use of non-financial indicators in Moroccan public institutions and enterprises (MPIE). Design/methodology/approach Aiming to study the factors which influence the use of financial and non-financial indicators within MPIEs, the authors attempted to identify all performance indicators used by the MPIEs in the sample. They selected 23 MPIEs with an industrial and commercial character and analyzed their reports for the period from 2010 to 2015. To evaluate the variety of performance indicators within these organizations, they used the multi-dimensional definition of performance recommended by Kaplan and Norton (1998) and used linear regressions to explain their relationship with the contextual variables. Findings Three hypotheses were developed regarding these contingency factors, predicting a positive relationship between the age, the size and the competitive environment of the organization, on one hand, and the use of non-financial indicators on the other hand. Following the study of MPIEs, the authors found that these organizations normally use financial indicators. However, the use of non-financial indicators is influenced by the age of the organization alone. Originality/value The scientific contribution of this paper is twofold: first, the authors seek to fill the gap in studies of performance measurement systems for MPIEs; second, they wish to enrich the scientific literature for underdeveloped countries which suffer from lack of data. Its managerial contribution is also dual: first, the authors aim to provide managers of MPIEs with a clearer understanding of non-financial measures that fully address the different management needs of their organizations; second, they encourage the government control using non-financial aspects alongside financial aspects.

Sustainability accounting, accountability and reporting in the public sector

“…The focus of prior studies has been primarily on developed nations and very little is known about how the public sector in developing nations manage and report their non-financial performance indicators. In line with this, Ibrahimi and Naym (2019) explored factors that influence the use of non-financial indicators in performance management systems of Moroccan Public Institutions and Enterprises (MPIE). The authors through the lens of contingency theory reveal that the use of nonfinancial indicators by the Moroccan MPIE is determined solely by the age of the organization.…”

Is quality management a competitive advantage? A study after the Spanish financial crisis in the furniture industry

“…The contingency-based perspective has been the dominant theoretical framework used in accounting research to investigate the role of management control systems in organisations (Chenhall, 2005;Ferreira & Otley, 2009;Gerdin & Greve, 2004;Henri & Wouters, 2020;Ibrahimi & Naym, 2019;Otley, 1994Otley, , 2016. Over the past forty years, it has provided insights into how different configurations and uses of control systems have resulted in a variety of different consequences (Granlund & Lukka, 2017;Otley, 2016).…”

Controllability of performance measures and managerial performance: the mediating role of fairness

“…Managers’ controllability of performance measures is considered to be a crucial component of performance evaluation processes due to the influence that controllability has on their behaviour (Bhimani et al , 2008; Burkert et al , 2011; Christensen, 2019), with our emphasis on both non-financial measures, in addition to the more common emphasis on traditional financial performance measures, enabling us to provide a more detailed insight into the impact of controllability through encapsulating a broader sphere of performance measures. While we focus on the controllability of financial measures, which most organisations focus on, the motivation for including the controllability of non-financial performance measures is supported by the literature, which levels increasing criticism towards financial measures for being too narrow in focus, too aggregated and historical in nature, and encouraging dysfunctional gaming behaviour (Burney et al , 2009; Chow and Van Der Stede, 2006; Gibbs et al , 2004; Ibrahimi and Naym, 2019; Hoque et al , 2001). Further, financial measures tend to focus on final results as opposed to ‘cause and effect’ and may ignore strategically important performance areas (Tung et al , 2011).…”

“…Alternatively, non-financial measures are considered to be broader in focus, less ambiguous, more forward-looking and better in respect to their ability to recognise the interests of organisations’ stakeholders (Doni et al , 2019; Dossi and Patelli, 2010; Khalid et al , 2019; Langfield-Smith et al , 2018). Further, non-financial measures are increasingly recognised as an integral component of an organisation’s overall control system (Ibrahimi and Naym, 2019). Hence, given organisations are increasingly broadening their performance measurement systems to include both financial and non-financial performance measures (Kwarteng and Aveh, 2018), this study will contribute to the literature by providing the first empirical examination of the impact of the controllability of both financial and non-financial measures on managers’ performance in Australian manufacturing firms.…”