FACTORS INFLUENCING DESIGN AND OUTCOMES OF PERFORMANCE MANAGEMENT SYSTEMS

Performance Management Systems (PMS) - also termed as Business Performance Management (BPM), Corporate Performance Management (CPM) or Enterprise Performance Management (EPM) - represents an often topic of debate in academic journals. The literature consists of two highly overlapping categories of research. The first category is research on Performance Measurement, which primarily addresses the question of appropriate measurement how company proceeds towards its performance goals. The second stream of research deals with Management Control Systems (MCS) and focuses more on the purpose of performance measurement and its specific context. The aim of this article is to address the following three basic research questions that each scholar starting research in PMS has to answer. Namely these are: RQ1. How to define contemporary PMS? RQ2. What are the key factors that influence the design and outcomes of PMS? RQ3. Which methods best reflect the interdependences among factors, PMS and performance? The article reveals that despite 50 years of research, the terminological inconsistencies persist involving the definition of the term PMS itself, its subcategories and last but not least the list of factors with impact on PMS. These contingency factors are briefly introduced and the final framework mapping their relationships is presented as well. Because traditional statistical methods coping with the standalone relationship are not sufficient, the quantitative studies in the intertwined nature of contingency factors, PMS and its outcomes usually employ the technique of Structural Equation Modelling (SEM), which represents the answer to the third research question.