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- Title
Dynamic Decision Making Using the Balanced Scorecard Framework.
- Authors
Humphreys, Kerry A.; Gary, Michael Shayne; Trotman, Ken T.
- Abstract
This study examines the effects that two balanced scorecard framework (BSF) elements, causal linkages between strategic objectives ("causal linkages") and time delay information ("delays") in a strategy map, have on long-term profit performance in a dynamic decision-making environment. Using a computer-based simulation task, we conduct a 3 x (4) experiment (control group; causal linkages without delays; causal linkages with delays; four simulation rounds) and find that managers presented with causal linkages without delays generate greater long-term profit compared to a control group. For managers presented with causal linkages with delays, long- term profit generation is higher than the control group, but is not significantly different from the causal linkages without delays treatment. Those managers presented with causal linkages with delays, however, demonstrate learning across the four simulation rounds. In contrast, learning is found to plateau for the causal linkages without delays treatment and is not present for the control group. We also examine the cognitive mechanism through which these two BSF elements impact performance, by measuring the accuracy of two components of managers' mental models.
- Subjects
BALANCED scorecard; DECISION making; TIME delay systems; SIMULATION methods &; models; CONTROL groups; MENTAL models theory (Communication)
- Publication
Accounting Review, 2016, Vol 91, Issue 5, p1441
- ISSN
0001-4826
- Publication type
Article
- DOI
10.2308/accr-51364