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Accountability and Role Effects in Balanced Scorecard Performance Evaluations When Strategy Timeline Is Specified

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  • Geoffrey Bartlett
  • Eric Johnson
  • Philip Reckers

Abstract

This study experimentally examines if fixation on lagging financial measures (relative to leading non-financial measures) as reported in prior balanced scorecard literature is mitigated when evaluators are provided with a strategy implementation timeline (a non-manipulated variable). The experiment manipulates whether or not evaluators are subject to process accountability as well as the role to which evaluators are assigned (i.e. supervisor or subordinate). We predict and find that, in general, the provision of an implementation timeline results in evaluators placing more weight on strategically linked, leading non-financial measures within a subordinate's time span of control compared to strategically linked, lagged financial measures beyond the subordinate's controllable time horizon. However, we also find that evaluators in the role of a supervisor differentiate less between strategically linked non-financial measures that fall within the subordinate's control and strategically linked financial measures beyond the subordinate's control when held accountable compared to supervisors not held accountable. On the other hand, participants in the role of a subordinate were able to differentiate appropriately between these measures when held accountable. Our results extend prior research by considering how linking a timeline to strategy implementation may assist evaluators when assessing performance in the presence of both leading and lagging strategic measures. Further, reference to an implementation timeline may influence role and accountability effects. Implications for future research in multidimensional strategic performance evaluation are discussed.

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  • Geoffrey Bartlett & Eric Johnson & Philip Reckers, 2014. "Accountability and Role Effects in Balanced Scorecard Performance Evaluations When Strategy Timeline Is Specified," European Accounting Review, Taylor & Francis Journals, vol. 23(1), pages 143-165, May.
    • Handle: RePEc:taf:euract:v:23:y:2014:i:1:p:143-165
    DOI: 10.1080/09638180.2013.809977
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    2. Carmona, Salvador & Iyer, Govind & Reckers, Philip M.J., 2014. "Performance evaluation bias: A comparative study on the role of financial fixation, similarity-to-self and likeability," Advances in accounting, Elsevier, vol. 30(1), pages 9-17.
    3. van Rinsum, M., 2019. "Utilizing Incentives and Accountability: In Control in Control?," ERIM Inaugural Address Series Research in Management EIA 2019-078-F&A, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam..
    4. Mina Ličen & Sergeja Slapničar, 2022. "Can process accountability mitigate myopic biases? An experimental analysis," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 33(1), pages 1-26, March.
    5. Dalla Via, Nicola & Perego, Paolo & van Rinsum, Marcel, 2019. "How accountability type influences information search processes and decision quality," Accounting, Organizations and Society, Elsevier, vol. 75(C), pages 79-91.

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