Performance measurement systems uses and company performance. Analysis of a sample of italian companies

Abstract

I believe that the most appropriate way to begin this project is to remark that all the work and the effort I have put into this paper has been possible thanks to the University of Bologna, which has been responsible for providing me with all the information and tools needed to deepen in the subject. In fact, my project could be considered as a collaboration or contribution to a larger project being developed by the University of Bologna and the University of Warwick, whose principal objective is to analyse the relationship between the use of performance measurement systems (PMS) made by Italian companies and their ability to innovate. Nevertheless, in particular, the purpose of this paper is to realise which PMS tools are being used by these Italian companies, as well as which type of use they are giving to them and what kind of performance they obtain. Moreover, I will delve into the study of possible correlations between the different uses and performances in order to discern if any specific use leads to an improvement in a particular performance. In regard to the scope of this project, 153 enterprises from Italy are involved in the study. As we shall discuss below, there are a wide variety of companies in terms of sectors to which they belong, annual turnover or number of employees, among others. Concerning the method whereby all the information was collected, a questionnaire was performed. It was a scientific statistical survey with an estimated time to complete it of around 10 minutes. The questionnaire was divided into 5 sections. In the first section, there were 20 questions about the uses of performance measurement systems, as well as an introductory question in which every company had to indicate which tools of PMS they are using. The second section was focused on questions of innovation. 24 questions were asked. In the third section, a total of 17 questions referring to performance were included. The aim of fourth section was to inquire about the competitive environment with 14 different questions. Finally, a fifth section was incorporated (17 questions) in which only general information was required. Every company had to answer all the questions with a number between 1 and 7 to show disagreement (represented by the number 1) or agreement (represented by the number 7). Once all the 153 companies completed the questionnaire, a database in excel with all the information was created. I must expose that all this arduous work was done by the University of Bologna and the University of Warwick. My role in this project is to analyse the database in different ways with excel tools. To start with, I will explain some of the concepts that are going to be discussed throughout the paper. Then, I shall present all the companies in the database in terms of size, turnover, location or sector, among others. Thereupon, the PMS tools will be introduced from different points of view. The same procedure will be followed to present the different uses that the companies give to these tools. In the end, I will go in depth into the different performances achieved by the companies and the possible correlations between uses and performances within the enterprises. As will be observed later, Analytical Accounting and Budget are the most frequently used PMS tools, whereas the most popular use of the PMS tools in general is the diagnostic use. Regarding the performance of the companies, the operational performance is the most achieved. Finally, it seems that, from an overall view, we can consider that there is a meaningful correlation between uses and performances.