The Curvilinear Association between Performance Measurement System Design and Strategic Performance

Melanie L. Schneider; Matthias D. Mahlendorf; Utz Schäffer

The Curvilinear Association between Performance Measurement System Design and Strategic Performance

Melanie L. Schneider, Matthias D. Mahlendorf, Utz Schäffer

Department of Accounting

Research output: Contribution to conference › Paper › Research › peer-review

Abstract

This paper reconciles prior research regarding beneficial and detrimental effects of performance measurement system (PMS) design on performance by arguing for a curvilinear association. By taking the too-much-of-a-good-thing effect as a starting point, we challenge the assumption of a linear association between PMS design and performance outcomes predominantly found in prior research. Based on the example of the level of detail of reporting information, we provide empirical evidence for a curvilinear association following the functional form of an inverse u-shape between this PMS design facet and two strategic performance outcomes. We attribute this to information under- and overload at extreme values of level of detail.
Based on a sample of 59 matched dyadic survey observations of heads of administration and chief orthopaedists of German hospitals, we provide empirical support for the curvilinear association between PMS design and strategic performance outcomes. Results are robust against the inclusion of different sets of controls and an additional specification as a seemingly unrelated regression model.

Original language	English
Publication date	2017
Number of pages	26
Publication status	Published - 2017
Event	14th Annual Conference for Management Accounting Research 2017 - WHU – Otto Beisheim School of Management, Vallendar, Germany Duration: 9 Mar 2017 → 10 Mar 2017 Conference number: 14 http://www.whu-acmar.com/acmar-2017/

Conference

Conference	14th Annual Conference for Management Accounting Research 2017
Number	14
Location	WHU – Otto Beisheim School of Management
Country/Territory	Germany
City	Vallendar
Period	09/03/2017 → 10/03/2017
Internet address	http://www.whu-acmar.com/acmar-2017/

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Cite this

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title = "The Curvilinear Association between Performance Measurement System Design and Strategic Performance",

abstract = "This paper reconciles prior research regarding beneficial and detrimental effects of performance measurement system (PMS) design on performance by arguing for a curvilinear association. By taking the too-much-of-a-good-thing effect as a starting point, we challenge the assumption of a linear association between PMS design and performance outcomes predominantly found in prior research. Based on the example of the level of detail of reporting information, we provide empirical evidence for a curvilinear association following the functional form of an inverse u-shape between this PMS design facet and two strategic performance outcomes. We attribute this to information under- and overload at extreme values of level of detail. Based on a sample of 59 matched dyadic survey observations of heads of administration and chief orthopaedists of German hospitals, we provide empirical support for the curvilinear association between PMS design and strategic performance outcomes. Results are robust against the inclusion of different sets of controls and an additional specification as a seemingly unrelated regression model.",

author = "Schneider, {Melanie L.} and Mahlendorf, {Matthias D.} and Utz Sch{\"a}ffer",

year = "2017",

language = "English",

note = "14th Annual Conference for Management Accounting Research 2017 ; Conference date: 09-03-2017 Through 10-03-2017",

url = "http://www.whu-acmar.com/acmar-2017/",

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The Curvilinear Association between Performance Measurement System Design and Strategic Performance. / Schneider, Melanie L.; Mahlendorf, Matthias D.; Schäffer, Utz.
2017. Paper presented at 14th Annual Conference for Management Accounting Research 2017, Vallendar, North Rhine-Westphalia, Germany.

Research output: Contribution to conference › Paper › Research › peer-review

TY - CONF

T1 - The Curvilinear Association between Performance Measurement System Design and Strategic Performance

AU - Schneider, Melanie L.

AU - Mahlendorf, Matthias D.

AU - Schäffer, Utz

N1 - Conference code: 14

PY - 2017

Y1 - 2017

N2 - This paper reconciles prior research regarding beneficial and detrimental effects of performance measurement system (PMS) design on performance by arguing for a curvilinear association. By taking the too-much-of-a-good-thing effect as a starting point, we challenge the assumption of a linear association between PMS design and performance outcomes predominantly found in prior research. Based on the example of the level of detail of reporting information, we provide empirical evidence for a curvilinear association following the functional form of an inverse u-shape between this PMS design facet and two strategic performance outcomes. We attribute this to information under- and overload at extreme values of level of detail. Based on a sample of 59 matched dyadic survey observations of heads of administration and chief orthopaedists of German hospitals, we provide empirical support for the curvilinear association between PMS design and strategic performance outcomes. Results are robust against the inclusion of different sets of controls and an additional specification as a seemingly unrelated regression model.

AB - This paper reconciles prior research regarding beneficial and detrimental effects of performance measurement system (PMS) design on performance by arguing for a curvilinear association. By taking the too-much-of-a-good-thing effect as a starting point, we challenge the assumption of a linear association between PMS design and performance outcomes predominantly found in prior research. Based on the example of the level of detail of reporting information, we provide empirical evidence for a curvilinear association following the functional form of an inverse u-shape between this PMS design facet and two strategic performance outcomes. We attribute this to information under- and overload at extreme values of level of detail. Based on a sample of 59 matched dyadic survey observations of heads of administration and chief orthopaedists of German hospitals, we provide empirical support for the curvilinear association between PMS design and strategic performance outcomes. Results are robust against the inclusion of different sets of controls and an additional specification as a seemingly unrelated regression model.

M3 - Paper

T2 - 14th Annual Conference for Management Accounting Research 2017

Y2 - 9 March 2017 through 10 March 2017

ER -