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Performance measures, consensus on strategy implementation, and performance: Evidence from the operational-level of organizations

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  • Ho, Joanna L.Y.
  • Wu, Anne
  • Wu, Steve Y.C.

Abstract

In this article, we examine how consensus between operational-level managers and employees on strategy implementation affects the effectiveness of performance measures and employee performance. We use field-based surveys and proprietary archival data from a Taiwanese financial services company to answer our research questions. Consistent with the predictions of person–organization fit theory, we find that consensus on the implementation of the customer-oriented strategy is positively associated with frontline employees’ performance. Our results also indicate that the incentive effect of using performance measures in performance evaluation and promotion is stronger for employees with a higher level of consensus. Our findings suggest that consensus is critical to the success of an organization’s strategy implementation and the effectiveness of performance measures.

Suggested Citation

  • Ho, Joanna L.Y. & Wu, Anne & Wu, Steve Y.C., 2014. "Performance measures, consensus on strategy implementation, and performance: Evidence from the operational-level of organizations," Accounting, Organizations and Society, Elsevier, vol. 39(1), pages 38-58.
    • Handle: RePEc:eee:aosoci:v:39:y:2014:i:1:p:38-58
    DOI: 10.1016/j.aos.2013.11.003
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    8. Cooper, Christine, 2015. "Entrepreneurs of the self: The development of management control since 1976," Accounting, Organizations and Society, Elsevier, vol. 47(C), pages 14-24.
    9. Carl Deschamps, 2019. "Stages of management control in a large public organization: from top to frontline managers," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 30(2), pages 153-184, July.
    10. Geovana Alves de Lima Fedato & Vanessa Martins Pires & Guilherme Trez, 2017. "The Future of Research in Strategy Implementation in the BRICS Context," Brazilian Business Review, Fucape Business School, vol. 14(3), pages 288-303, May.
    11. Margaret A. Abernethy & Henri C. Dekker & Jennifer Grafton, 2021. "The Influence of Performance Measurement on the Processual Dynamics of Strategic Change," Management Science, INFORMS, vol. 67(1), pages 640-659, January.
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    13. Kelly Cristiny Chinelato Sacramento & Adalberto Americo Fischmann, 2019. "Cognitive and Structural Factors: What Makes Strategy Implementation so Hard?," 2019 Papers psa1759, Job Market Papers.
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    16. Kwee Keong Choong & Sardar M. Islam, 2020. "A new approach to performance measurement using standards: a case of translating strategy to operations," Operations Management Research, Springer, vol. 13(3), pages 137-170, December.
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