The aim of the thesis is to examine the effects of performance measurement systems on creativity on an individual employees’ level, as well as the implications it might have on the organizations’ value creation. The thesis elaborates on the use of performance measurement system for incentivizing and control purposes, which is regarded as a possible constraint on creative freedom. Using eight semi-structured interviews and observation studies, a qualitative case study of two comparable companies was conducted. IIH Nordic and AdNuvo are both Danish companies in the digital marketing industry, but with a distinct approach to performance measurement design and incentive system. The thesis theoretically defines the relationship between the fundamentals of structure, culture, management, performance measurement systems and motivation. The empirical findings revealed a need for informality in the culture and structure, defined as a loose environment and freedom. Additionally, in both cases social norms served as a safety net against possible risk, also for the decentralized structure that both organization has adapted. Results indicated, that incentivize employees job design contributed to a high level of motivation, whereas intrinsic motivation best accommodates the creativity and is the most sufficient motivation strategy in a creative setting. In IIH Nordic, creativity was negatively affected by choices of multiple measures and targets, directing employee performance and limiting creative freedom. By contrast, AdNuvos performance measurement system was segregated from employee perspective, but also lack of evaluation and structured feedback, which suppress creative efforts. The thesis finds that an extended performance measurement system has negative impact on creative work. It is however assessed, that the measurement system should grant certainty and limits. The system should, in this perspective, be supported by an optimal level of constraints in form of performance measurement in order to frame creative performance. It will enhance creative focus and process, and hereby enhance organizational value creation.
|Educations||MSc in Accounting, Strategy and Control, (Graduate Programme) Final Thesis|
|Number of pages||224|