Description
HI, I’d like your kind support to summarize 24 articles (all uploaded) in a specific table (as below) :
JOURNAL PAPERS
No
Authors
Theoretical model & variables
Findings & contributions
Method and sample
1.
Abrahamson, 1991
Four theoretical perspectives:
1. Efficient-choice
2. Fad
3. Fashion
4. Forced-selection
When and how are technically inefficient innovations adopted and when and how are technically efficient innovations rejected?
Defines perspectives based on power, networks, politics, mimicry and performance level of firms. Processes outside and inside the organization are examined. Effectively looks at efficiency vs. fads in adoption of innovations
Conceptual paper
2.
Abrahamson & Rosenkopf, 1993
Proposes a mathematical model of bandwagons (non-adopters fear appearing different from few adopters thus adopt) to determine:
1. whether a bandwagon will occur
2. how many organizations jump on it
3. how many retain the innovation it diffuses
Data are based on “collectivities” and the idea of ambiguity in the usefulness of the innovation.
Log of proportions of adopters (that have even dropped the innovation in the meantime) are included.
Testing a bandwagon model.
3.
Ahmadjian & Robinson, 2001
Spread of downsizing as a practice:
Resistant organizations were old, large, domestically owned, with high reputation and high human capital.
As more organizations downsized thought, individual choices became less influential and, in a bandwagon process, resistant organizations imitated the majority that had adopted downsizing as a practice.
Demonstrates the safety-in-numbers effect in adoption studies. Examines the interaction between social and economic effects over time.
Defines downsizing as laying off 5% or more of a firm’s labour. Does alternative analyses with downsizing at 2% and 10%. Discrete-time event history with a panel probit model that includes time-constant and time-varying covariates.
4.
Alakent & Lee, 2009
Spread of downsizing in S. Korea:
1. Economic (+) and institutional (-) factors apply opposite pressures on organizations
2. Poor performance/productivity and poor exports increase downsizing (+) while size, domestic ownership, gov. support and unionization decrease downsizing (-)
3. Prior experience with downsizing increases likelihood of future downsizing (+)
Tests the assumptions of Ahmadjian & Robinson (2001) not longitudinally but in the harsh financial distress of a single year (1997).
Hierarchical OLS regression
Unformatted Attachment Preview
Exploring the use of the Balanced Scorecard (BSC) in
the healthcare sector of the Kingdom of Saudi Arabia:
Rhetoric and reality. Evaluate understanding the five
perspectives of the BSC. Evaluating the understanding
of linkage between the BSC and strategy of the hospital.
The reality of the implementation of BSC in KFSH
Item Type
Thesis
Authors
Al Thunaian, Saleh A.
Rights
The University of Bradford
theses are licenced under a Creative
Commons Licence.
Download date
19/02/2024 13:57:16
Link to Item
http://hdl.handle.net/10454/6290
University of Bradford eThesis
This thesis is hosted in Bradford Scholars – The University of Bradford Open Access
repository. Visit the repository for full metadata or to contact the repository team
© University of Bradford. This work is licenced for reuse under a Creative Commons
Licence.
EXPLORING THE USE OF THE BALANCED SCORECARD (BSC) IN
THE HEALTHCARE SECTOR OF THE KINGDOM OF SAUDI ARABIA:
RHETORIC AND REALITY
S. A. AL THUNAIAN
PhD
2013
EXPLORING THE USE OF THE BALANCED SCORECARD
(BSC) IN THE HEALTHCARE SECTOR OF
THE KINGDOM OF SAUDI ARABIA:
RHETORIC AND REALITY
Evaluate understanding the five perspectives of the BSC. Evaluating
the understanding of linkage between the BSC and
strategy of the hospital. The reality of the
implementation of BSC in KFSH
Saleh Abdulrahman Al Thunaian
submitted for the degree
of Doctor of Philosophy
School of Management
University of Bradford
2013
Abstract
This thesis aims to evaluate the implementation of the Balanced Scorecard
(BSC) based on a case organization; the King Faisal Specialist Hospital and Research
Centre (KFSH-RC). The study is an exploratory investigation. Understanding BSC
perspectives is important for academic comprehension and is crucial for successful
implementation. BSC at KFSH-RC includes five main perspectives: Quality of Care;
Medical Care; Employees; Financial; and Education and Research (learning and
growth). The thesis tackles two main anecdotal, practice-based arguments: BSC helps
achieve business strategy, and the implementation of BSC has often fallen short of the
assertions made about its potential for impact.
A case study with a triangulation approach is justified and pursued. This study
contributes to the literature in different ways. The application of the BSC has received
limited attention in healthcare organisations in general, and in the Middle East and
North Africa (MENA) in particular, and may be one of the first to explore such issues,
across management and professional groups, to research BSC in the healthcare
organisation in the KSA. It distinguishes between the understanding of financial and
non-financial perspectives; and the researcher has developed a conceptual framework,
which reflects the main elements of BSC implementation.
Quantitative data analysis from the case study indicates that staff members at the
KFSH possess only a shallow understanding of various BSC perspectives. The study
revealed a consistent lack of understanding of BSC by the department employees, due
to their lack of interest. The results show that performance measures following the
implementation of BSC created no significant improvement. It also confirms that even
some senior managers face difficulties understanding BSC perspectives. The
qualitative-based findings indicate that the level of understanding of BSC for clinical
services is not significantly different from that for non-clinical services; staff members
of the KFSH resist the implementation of BSC in the early stages; and there is
‘autocratic’ leadership style at the KFSH inhibited the flow of information. The power
distance and autocratic leadership style, in combination with an inadequate launch of
BSC, fail to follow the implementation steps recommended by both Kaplan and Norton
(2001a) and Kotter (1996). These organisational dynamics, it will be argued, are
understated in the original BSC methodology, a view consistent with the findings of
Woodley (2006) and may be especially so in environments with strong professional
norms such as hospitals. The implications for the study and practice of non-profit
organisations wishing to adopt methodology developed initially in a commercial
context, is considered.
Keywords: Balanced scorecard, business strategy, health services, performance
measurement, bench-marking, knowledge management, Saudi Arabia, case study
i
Acknowledgement
First, and from the bottom of my heart, I express my thanks to Almighty
ALLAH for His blessings, bestowing the abilities, assigning the time, keeping me
healthy throughout the study period, and helping me to acquire knowledge to complete
the research.
I wish to express my deep sense of gratitude and sincere thanks to Prof. Dr.
Nelarine Cornelius (Professor and Associate Dean, Research and Knowledge Transfer,
School of Management, University of Bradford, UK), for her invaluable guidance and
practical suggestions. Her constant encouragement and productive reviews throughout
the research and of the completed manuscript are hugely appreciated.
I would also like to thank the Minister of Higher Education, Dr. Khalid AlAngari (Saudi Arabia) for his support, for which 1 am extremely grateful.
I am indebted to Dr. Gassem Al-Kosaibi (General Executive Supervisor of
King Faisal Specialist Hospital (Saudi Arabia)), for granting me permission to conduct
the PhD study at KFSH-RC (Saudi Arabia) and for allowing me to utilise the facilities
of their library during the field study period.
ii
Dedication
This thesis is dedicated to my parents for their endless love, support, and
encouragement; and to my wife Aysha, whose loving support and boundless patience
made all of this possible. I also express my deep and heartfelt thanks to one and all that
were involved in my research work and helped me complete it successfully, especially
Dr. Wael Aldaya and Dr. Salah Alawadhi.
“ﺃﻫﺩﻱ ﻫﺫﻩ ﺍﻻﻁﺭﻭﺣﺔ ﺇﻟﻰ ﺃﻣﻲ ﻭﺃﺑﻲ “ﻟﺣﺑﻬﻡ ﻭﺗﺷﺟﻳﻌﻬﻡ ﻭﺩﻋﻣﻬﻡ ﺍﻟﺫﻱ ﻻ ﻧﻬﺎﻳﺔ ﻟﻪ
“ﺇﻟﻰ ﺯﻭﺟﺗﻲ ﻋﺎﺋﺷﺔ “ﻟﺣﺑﻬﺎ ﻭﺻﺑﺭﻫﺎ ﺍﻟﺫﻱ ﻻ ﺣﺩﻭﺩ ﻟﻪ ﻭﺍﻟﺫﻱ ﺟﻌﻝ ﺫﻟﻙ ﻣﻣﻛﻧﺎ
ﺻﻼﺡ ﺍﻟﻌﻭﺿﻲ: ﻭﺍﺋﻝ ﺍﻟﺩﺍﻳﺔ ﻭ ﺍﻟﺩﻛﺗﻭﺭ: ﺃﻗﺩﻡ ﻣﻥ ﺃﻋﻣﺎﻕ ﻗﻠﺑﻲ ﺷﻛﺭﻱ ﻟﻛﻝ ﻣﻥ ﺍﻟﺩﻛﺗﻭﺭ
. ﻋﻠﻰ ﻣﺳﺎﻋﺩﺗﻬﻡ ﻟﻲ ﻓﻲ ﻫﺫﻩ ﺍﻟﻣﺭﺣﻠﺔ ﺍﻷﻛﺎﺩﻳﻣﻳﺔ ﻣﻥ ﺍﻟﺑﺣﺙ
iii
List of Abbreviations
BSC
Balanced Scorecard
CASRO
Council of American Survey Research Organisations
HR
Human Resource
IPA
Institute of Public Administration
KFSH
King Faisal Specialist Hospital
KFSH-RC
King Faisal Specialist Hospital and Research Centre
KM
Knowledge Management
KMO
Kaiser-Myer-Oklin
KPI
Key Performance Indicators
KSA
Kingdom of Saudi Arabia
MCA
Medical Clinical Affairs
MENA
Middle East and North Africa
MIS
Management Information System
NPO’S
Non-profit Organisations
PSO’S
Public Sector Organisations
QUAL
Qualitative Data
QUAN
Quantitative Data
SBU
Strategic Business Unit
UAE
United Arab Emirates
iv
Table of Contents
Abstract ……………………………………………………………………………………………………………… i
Acknowledgement………………………………………………………………………………………………. ii
Dedication ………………………………………………………………………………………………………… iii
List of Abbreviations ………………………………………………………………………………………….. iv
List of Tables……………………………………………………………………………………………………… ix
Chapter 1: Introduction……………………………………………………………………………………….. 1
1.1 Background of the study……………………………………………………………………………… 1
1.2 Research problem ………………………………………………………………………………………. 5
1.3 The methodology of the study ……………………………………………………………………… 6
1.4 Research objectives ………………………………………………………………………………….. 10
1.5 Research questions …………………………………………………………………………………… 11
1.6 The scope and duration of the study ……………………………………………………………. 14
1.7 The structure of the thesis …………………………………………………………………………. 14
Chapter: 2 The literature review …………………………………………………………………………. 18
2.1 Introduction …………………………………………………………………………………………….. 18
2.2 The Balanced Scorecard definition……………………………………………………………… 21
2.2.1 The generations of BSC ………………………………………………………………………. 25
2.2.2 BSC perspectives: Kaplan and Norton’s Rationale …………………………………. 26
2.2.3 Learning and growth …………………………………………………………………………… 29
2.2.4 BSC is a strategic management tool ……………………………………………………… 31
2.2.5 BSC is a summarised performance measurement tool …………………………….. 40
2.2.6 BSC is for the private and the public sectors ………………………………………….. 42
2.2.7 BSC, culture – and criticisms ……………………………………………………………….. 48
2.2.8 BSC is a knowledge management tool ………………………………………………….. 51
2.3 Empirical studies on BSC………………………………………………………………………….. 60
2.3.1 Successful implementation ………………………………………………………………….. 60
2.3.2 Unsuccessful implementation ………………………………………………………………. 68
2.4 BSC in healthcare organisations …………………………………………………………………. 75
2.4.1 The modifications of BSC …………………………………………………………………… 76
2.4.2 The utilization of BSC in healthcare organisations …………………………………. 79
2.5 Summary and Conclusion ………………………………………………………………………….. 82
v
Chapter 3: The Conceptual Framework ……………………………………………………………….. 84
3.1 Introduction …………………………………………………………………………………………….. 85
3.2 BSC Conceptual Framework ……………………………………………………………………… 86
3.3 Understanding BSC ………………………………………………………………………………….. 88
3.3.1 Determinants of successful implementation of BSC ……………………………….. 91
3.3.2 The level of communication ………………………………………………………………… 92
3.3.3 Weighting BSC perspectives ……………………………………………………………….. 95
3.3.4 Management information systems ………………………………………………………… 97
3.3.5 Culture ……………………………………………………………………………………………. 100
3.3.6 Linkage …………………………………………………………………………………………… 111
Chapter 4: KFSH-RC in Context…………………………………………………………………………. 114
4.1 Introduction …………………………………………………………………………………………… 114
4.2 Background of KFSH ……………………………………………………………………………… 115
4.3 The strategic map of KFSH ……………………………………………………………………… 117
4.3.1 Mission, Vision, and Values ………………………………………………………………. 117
4.3. 2 Driving Forces ………………………………………………………………………………… 118
4.3.3 The Strategic priorities of KFSH ………………………………………………………… 120
4.4 The evolution of the BSC at the KFSH-RC ……………………………………………….. 122
4.4.1 Medical care perspective …………………………………………………………………… 123
4.4.2 Quality of care perspective ………………………………………………………………… 124
4.4.3 Employee perspective ……………………………………………………………………….. 125
4.4.4 Financial perspective ………………………………………………………………………… 126
4.4.5 Education and research perspective …………………………………………………….. 126
4.5 Summary and Conclusions ………………………………………………………………………. 128
Chapter 5: Research Methodology and Design……………………………………………………. 129
5.1 Introduction …………………………………………………………………………………………… 129
5.2 Research purpose, and research paradigm and philosophy …………………………… 130
5.2.1 Research purpose: …………………………………………………………………………….. 130
5.2.2 Research paradigm and philosophy ……………………………………………………. 132
5.2.3 Research methodologies: Qualitative and quantitative…………………………… 137
5.3 Research strategy – Case study …………………………………………………………………. 143
5.3.1 Reasons for applying the case study approach …………………………………….. 144
vi
5.3.2 The challenges of the case study…………………………………………………………. 145
5.4The rationale of the research philosophy and methodology…………………………… 145
5.5 The research design of this thesis ……………………………………………………………… 148
5.5.1 Methodological triangulation……………………………………………………………… 150
5.5.2 Data Triangulation ……………………………………………………………………………. 152
5.5.3Ethical considerations ………………………………………………………………………… 159
Chapter 6: Results …………………………………………………………………………………………… 161
6.1 Introduction …………………………………………………………………………………………… 161
6.2 The pilot study ……………………………………………………………………………………….. 161
6.3 Population and sample of the study …………………………………………………………. 162
6.4 Data analysis used ………………………………………………………………………………….. 169
6.4.1 Quantitative analysis …………………………………………………………………………. 169
6.4.2 Qualitative analysis …………………………………………………………………………… 171
6.5 Reliability, validity and ethical considerations …………………………………………… 173
6.5.1 Reliability………………………………………………………………………………………… 173
6.5.2 Validity …………………………………………………………………………………………… 178
6.6 Quantitative data analysis ………………………………………………………………………… 181
6.6.1 Understanding the BSC Perspectives…………………………………………………… 182
6.7 Qualitative data analysis ………………………………………………………………………….. 193
6.7.1 Semi-structured interview analysis ……………………………………………………… 193
6.7.2 Coding for thematic analysis ……………………………………………………………… 195
6.7.3 Thematic analysis of the semi-structured interviews ……………………………… 200
6.7.4 Historical Observation analysis ………………………………………………………….. 222
6.8 Summary and conclusion ………………………………………………………………………… 229
Chapter 7 – Discussion and conclusions …………………………………………………………….. 232
7.1 Introduction …………………………………………………………………………………………… 232
7.2 Hypotheses and Propositions……………………………………………………………………. 232
7.2.1 Hypotheses ………………………………………………………………………………………. 232
7.2.2 Propositions …………………………………………………………………………………….. 241
7.3 The conceptual model and the research questions …………………………………….. 256
7.4 Contributions …………………………………………………………………………………………. 259
7.5 Recommendations, gaps, and suggested further research ………………………….. 261
vii
7.5.1 Recommendations ……………………………………………………………………………. 261
7.5.2 Gaps and suggested further research …………………………………………………… 264
References……………………………………………………………………………………………………… 266
Appendix ……………………………………………………………………………………………………….. 282
viii
List of Tables
Chapter 1
Table 1. 1 The emergent, research hypotheses:……………………………………………………. 13
Chapter 2
Table 2. 1 The main objectives of each BSC perspective 2001a, and 2004 ………………. 31
Table 2. 2 Summarizes the criteria for spreading the knowledge of BSC ………………….. 54
Table 2. 3 Summarises the main reasons for failure of BSC …………………………………… 75
Chapter 3
Table 3. 1 Employees’ understanding of organisational strategy and their performance
……………………………………………………………………………………………………………………….. 86
Table 3.2 The communication channels ………………………………………………………………. 94
Table 3. 3 Ways to spread awareness of the management information system
(Proti,2002, Martinsons, 1999) …………………………………………………………………………… 98
Table 3. 4 Measures of the organizational culture ………………………………………………. 100
Chapter 4
Table 4. 1 Medical care perspectives …………………………………………………………………. 124
Table 4.2 Quality of care perspective ………………………………………………………………… 125
Table 4.3 Employees perspective………………………………………………………………………. 126
Table 4.4 Financial perspectives ……………………………………………………………………….. 126
Table 4.5 Education and research perspective ……………………………………………………. 127
Chapter 5
Table 5.1 The differences between the research design and research methodology . 130
Table 5. 2 A comparison of basic research design ……………………………………………….. 132
Table 5. 3 Differences between quantitative and qualitative methods ………………….. 139
Table 5.4 The five-point Likert scale …………………………………………………………………. 154
Chapter 6
Table 6. 1 The distribution of KFSH staff and the number of questionnaires delivered
……………………………………………………………………………………………………………………… 163
Table 6. 2 Response rates of distributed questionnaires ……………………………………… 166
ix
Table 6.3 Presents the mathematical method for calculating the response rate …….. 166
Table 6.4 The demographic specifications………………………………………………………….. 168
Table 6. 5 Labelling and coding system in SPSS software ……………………………………… 170
Table 6. 6 Phases of thematic analysis……………………………………………………………….. 172
Table 6. 7 Benefits of thematic analysis……………………………………………………………… 173
Table 6. 8 Reliability test results using Cronbach’s Alpha……………………………………… 175
Table 6. 9 Reliability analysis for strategic knowledge …………………………………………. 175
Table 6. 10 Reliability analysis for the financial perspective …………………………………. 176
Table 6. 11 Reliability analysis for the customer perspective ……………………………….. 176
Table 6. 12 Reliability analysis for the internal process perspective ………………………. 176
Table 6. 13 Reliability analysis for the Learning and growth perspective ……………….. 177
Table 6. 14 Reliability analysis for the linkages……………………………………………………. 177
Table 6. 15 Reliability analysis for employees’ understanding of the perspectives ….. 178
Table 6. 16 Construct validity using the factor analysis technique ………………………… 181
Table 6. 17 Presents the understanding of the quality of care perspective …………….. 183
Table 6. 18 Reports the difference in understanding of the quality of care perspective
between clinical and non-clinical staff……………………………………………………………….. 184
Table 6.19 Presents the understanding of the internal process perspective. ………….. 184
Table 6. 20 Reports the difference in understanding of the internal process perspective
between clinical and non-clinical staff……………………………………………………………….. 185
Table 6. 21 Presents the understanding of the learning and growth perspective. …… 186
Table 6. 22 Reports the difference in the understanding of the learning and growth
perspective between clinical and non-clinical staff ……………………………………………… 186
Table 6. 23 Presents the understanding of the medical care perspective. ……………… 187
Table 6. 24 Presents the difference in understanding of the medical care perspective
between clinical and non-clinic staff. ………………………………………………………………… 188
Table 6. 25 Presents the understanding of the financial perspective. ……………………. 188
Table 6. 26 Reports the difference in understanding of the financial perspective
between clinical and non-clinical staff……………………………………………………………….. 189
Table 6. 27 Understanding the linkage of BSC with the strategy …………………………… 190
Table 6. 28 The Pearson correlations between the BSC perspectives and the business
strategy …………………………………………………………………………………………………………. 191
Table 6. 29 Compares of top management levels understanding of BSC with lower
management levels. ………………………………………………………………………………………… 193
6. 30 present the demographic distribution of the interviewees…………………………… 194
Table 6. 31 Depicts the clusters, designated themes and emerged themes from the
semi-structured interviews ………………………………………………………………………………. 202
Table 6. 32 compare the interviwees attention between the financial and non-financial
measures. ………………………………………………………………………………………………………. 209
Table 6. 33 The communication tools that mentioned by interviewees. ………………… 215
x
Chapter 7
Table 7. 1 Examines the understanding of the BSC perspectives and the linkage ……. 233
Table 7. 2 Compares the mean Likert score values for the financial and non-financial
perspectives …………………………………………………………………………………………………… 236
Table 7. 3 Compares the mean values of the understanding of BSC perspectives by
clinical and non-clinical staff. ……………………………………………………………………………. 237
Table 7. 4 Presents the changes in the quality of care performance indicators following
BSC implementation………………………………………………………………………………………… 239
Table 7. 5 Presents the changes in the medical care performance indicators following
BSC implementation as explained in quantitative analysis in chapter 6. ………………… 240
Table 7. 6 Presents the changes in the learning and growth performance indicators
following BSC implementation as explained in quantitative analysis in chapter 6 . … 241
xi
Chapter 1: Introduction
1.1 Background of the study
Since the development of the Balanced Scorecard (BSC) of Kaplan and Norton
(1996), a substantial volume of literature has considered the importance of such tools on
company strategy. According to Kaplan and Norton (1992), the BSC includes four main
perspectives: financial, customer, learning and growth, and internal process
perspectives. Kaplan and Norton (2001b) define the financial perspective as the strategy
for growth, profitability, and risk, viewed from the perspective of the shareholder. They
consider the customer perspective as the leading indicator and an important vehicle for
companies wishing to engage more proactively with their customer’s needs. The third
BSC perspective is the internal business process. According to Kaplan and Norton
(2001b), the internal business process perspective enables managers to identify the
processes that are critical for achieving customer and shareholder objectives. Learning
and growth (or innovation) is the fourth BSC perspective, which enables a company to
create long-term growth and improvement. The learning and growth perspective is a
framework for quantitatively assessing employees’ satisfaction, productivity, and
retention. Each of the previous perspectives consists of relevant strategic goals,
indicators, and measures linked to the business strategy.
The central importance of BSC is the balance between different perspectives. Olve and
Sjostrand (2006) suggest that the idea of balance is particularly important in three areas:
the balance between financial and non-financial perspectives, the balance between
internal and external stakeholders, and the balance between short-term and long-term
perspectives.
1
BSC is considered as a multi-dimensional management tool, since it serves as a
strategic management tool, a communication management tool, a performance
management tool, and a KM tool. In addition, Kaplan and Norton (1997) suggest that
BSC can create a new business culture that helps to incorporate all management levels
in the decision making process.
One of the key contributions of BSC is that employees are motivated by a clear
organizational strategy. Employees want to understand the interaction between their
activities and the organization’s mission, vision, values, and strategy (Kaplan and
Norton, 1994). BSC allows internal and external communication to spread the KM
within the human relations. Kaplan and Norton (2001b) suggest that employees must
learn and understand the strategy before they contribute to the implementation of the
process.
Kaplan and Norton (1996) believe that BSC provides clear, understandable, and
achievable measures. They suggest that for each of the four BSC perspectives, (four as a
minimum in each and seven as the maximum) 22 independent measures on average are
needed. Kaplan and Norton (1996) claim that the number of measures does not matter,
if they are not absorbed by the company.
The extant literature suggests that the main objective of the implementation of
BSC is to improve organisational performance. To do this, companies have to facilitate
the flow of information through top-down and bottom-up channels. Information on what
are perceived to be the key success factors for the strategy needs to be communiticated
effectively to staff members at all management levels. Furthermore, the process of
learningmay enhance the understanding of the main drivers of business success.
Woodley (2006) suggests that one should highlight the importance of culture to the
2
application of BSC. Ignoring the impact of culture on BSC may inhibit the
understanding of BSC drivers, which in turn detriorates performance measures.
Kaplan and Norton (2001a) suggest that BSC looks like a knowledge management
(KM) system in that employees must be aligned to the strategy in order to create value.
Thus, KM is a dynamic mixture of human, intellectual, social, and structural capital,
which provides the fuel for creating and using knowledge. Many companies use the
BSC tool as a KM process within the organizational structure of the firm.
Kaplan and Norton (1996) assume that BSC is a useful tool for non-profit
organisations (NPOs) as well as for-profit organisations. Though developed in the
context of commercial organisations, Kaplan (2001) asserts that BSC may also be
applied to public sector organisations (PSOs) and NPOs, albeit with some amendments.
These amendments are a fundamental issue, because the nature of the strategy and
drivers in the PSOs and NPOs are often substantially different to the private sector with
its profit motive.
Studies on the implementation of BSC on company performance show mixed
results. One strand of literature shows that the implementation of BSC is useful (see for
example, Kaplan and Norton (1994), Martinsons (1999), Hoque and James (2000), and
Chi and Hung (2011)). This literature shows how companies successfully translate their
strategies into actions. Furthermore, this literature presents some evidence on how
companies balance financial and non-financial perspectives, internal and external needs,
and short-term and long-term objectives these researchers show empirically that
organisations can successfully communicate BSC principles to junior management
levels. They also claim that BSC has a great impact when deployed to drive
organisational change (Kaplan and Norton, 1996).
3
However, in another strand of literature, for example Pforsich (2005), Olve et al.
(2004), and Dent (2005), a considerable number of ‘failure’ stories are presented. In this
literature, BSC failure is attributed to many factors. Olve et al. (2004) suggest that the
failure of BSC implementation is due to poor knowledge sharing, which neglects to
facilitate learning from other units’ goals and targets. They also attribute the failure to
the fact that BSC is not linked with the incentive system. Other factors as suggested by
Pforsich (2005), Olve et al. (2004), and Dent (2005) include the following: incorrect
selection of appropriate measures; inefficient implementation by the management, or
delayed feedback or over-emphasis on financial measures. Similarly, Ho and Mckay
(2002) attribute failure to delayed feedback and an uncontrollable number of measures.
They also found that the top management level did not deploy BSC to their business
units.
Despite the controversy and contradictions within this practice paradigm, the
Saudi government made a strategic decision, encouraging for-profit and public firms to
strengthen tactical systems and improve management performance indicators though the
implementation of BSC. Thus, in the last ten years, BSC has been adopted by several
large companies in Saudi Arabia. A considerable number of private sector institutions
have applied BSC including the Saudi Ar
