Firm characteristics and balanced scorecard usage in Singaporean manufacturing firms

Ling Liu, Janek Ratnatunga and Lee Yao

International Journal of Accounting & Information Management, 2014, vol. 22, issue 3, 209-222

Abstract: Purpose - – This study aims to examine the effects of balanced scorecard (BSC) usage on performances in the context of four contingent variables in Singaporean manufacturing firms. The results show that firms are more likely to adopt BSC if they are large in size, have products at an early product lifecycle (PLC) stage, operate in highly uncertain environments or adopt differentiation strategies. However, the adoption of BSC improves performance only in firms that are large or have products at an early PLC stage. The results suggest that contingent factors in which a firm operates can exert significant effects on the results of adopting BSC. Design/methodology/approach - – Survey data are collected, then the authors check data correlations, principle components analysis, run regression analysis and ANOVA. Findings - – BSC use is positively and significantly correlated with PLC stage, external environment and performance. Size and strategy are positively correlated with BSC usage, but are not statistically significant. Higher BSC use is found in large firms with products at an early PLC stage or operating in a highly uncertain environment. Companies with a cost leadership strategy are significantly associated with BSC use. Research limitations/implications - – This study has small sample size and uses survey research method. The measurements to capture all aspects of BSC usage are non-exhausting. Future research can use different methodologies, such as field studies, case studies and lab experiments, to examine other industries than manufacturing. Practical implications - – The authors results show the positive association between BSC use and certain firm characteristics. Firms with those characteristics should get insights about the benefit of using BSC and extract the maximum benefit from their investment on the BSC use and those firms which don’t have BSC in implication may think of implementing the BSC use. Social implications - – Firms’ contingent factors affect the value of adopting BSC. With the authors research result, firms will be aware of how to extract the most value out of BSC and improve the social wealth of the manufacturing industries. Originality/value - – The authors paper is the first paper to use survey method to examine the association between BSC and firms’ contingent factors in the Singaporean manufacturing firms setting.

Keywords: Balanced scorecard; Organizational performance; Environmental uncertainty; Product lifecycle; Singaporean manufacturing firms (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijaimp:v:22:y:2014:i:3:p:209-222

DOI: 10.1108/IJAIM-05-2013-0038

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