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Joint selection of balanced scorecard targets and weights in a collaborative setting

Authors
Journal
Journal of Accounting and Public Policy
0278-4254
Publisher
Elsevier
Publication Date
Volume
29
Issue
1
Identifiers
DOI: 10.1016/j.jaccpubpol.2009.10.002
Keywords
  • Balanced Scorecard
  • Joint Decision Making
  • Balanced Scorecard Targets And Weights
  • Negotiation Analysis

Abstract

Abstract Information asymmetries may create problems in developing both the balanced scorecard (BSC) targets and weights. In practice, the process of assigning weights to performance measures can be challenging in terms of reaching a consensus between top management and divisional managers. In this research, we address the issues of target and weight selection using a collaborative decision-making model. Most of the previous research related to performance measurement has assumed self-interested agents. When weights are assigned subjectively, there is evidence in the literature of common-measure bias leading to BSC disagreement (conflict). We contribute to the literature by considering actor preferences in a novel approach that permits the parties jointly to determine optimal (or approximately optimal) BSC targets and weights.

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