Environmental Uncertainty, Performance Measure Variety and Perceived Performance in Icelandic Companies

The use of performance measures and performance measurement frameworks has increased significantly in recent years. The type and variety of performance measures in use has been researched in various countries and linked to different variables such as the external environment, performance measurement frameworks, and management characteristics. This paper reports the results of a study carried out at year end 2013 of the use of performance measures by Icelandic companies and the links to perceived environmental uncertainty, management satisfaction with the performance measurement system and the perceived performance of the company. The sample was the 300 largest companies in Iceland and the response rate was 27%. Compared to other studies the majority of the respondents use a surprisingly high number of different measures – both financial and non-financial. This made testing of the three hypotheses difficult. Possible explanations of the high number of performance measures in use in Icelandic companies could be the recent period of high environmental turbulence forcing them to adopt more measures focusing on a variety of performance areas. This should be researched further.