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Developing a performance management system using soft systems methodology: A Chinese case study

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  • Liu, Wenbin B.
  • Meng, Wei
  • Mingers, John
  • Tang, Ning
  • Wang, Wei

Abstract

The economic crisis created major problems for a successful, hi-tech Chinese company – Tonsan. They already had in place a performance management system based around the balanced scorecard which worked successfully in times of growth and high demand. However, with the world downturn they suddenly found that their current system was not able to cope with the demands placed on it. The authors were called in and decided to design a new, strategic performance management system to overhaul all the key business processes. The approach taken to develop the PM system was based around Soft Systems Methodology (SSM), a well established systems-based approach to problem solving and organizational design. The methodology progressed from the development of key strategic objectives (using the BSC and strategy maps), through a structured decomposition of necessary organizational activities, the construction of key performance indicators, the specification of targets, to communication and future planning. It involved significant levels of participation and communication throughout the organization. The results were judged by senior management to have been very successful, and the company has grown significantly.

Suggested Citation

  • Liu, Wenbin B. & Meng, Wei & Mingers, John & Tang, Ning & Wang, Wei, 2012. "Developing a performance management system using soft systems methodology: A Chinese case study," European Journal of Operational Research, Elsevier, vol. 223(2), pages 529-540.
    • Handle: RePEc:eee:ejores:v:223:y:2012:i:2:p:529-540
    DOI: 10.1016/j.ejor.2012.06.029
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    References listed on IDEAS

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    3. Sainaghi, Ruggero & Phillips, Paul & Zavarrone, Emma, 2017. "Performance measurement in tourism firms: A content analytical meta-approach," Tourism Management, Elsevier, vol. 59(C), pages 36-56.
    4. Wang, Wei & Liu, Wenbin & Mingers, John, 2015. "A systemic method for organisational stakeholder identification and analysis using Soft Systems Methodology (SSM)," European Journal of Operational Research, Elsevier, vol. 246(2), pages 562-574.

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