The interrelations of decision‐making rationales around BSC adoptions in Finnish municipalities

Abstract

Purpose

The purpose of this paper is to analyze the interrelations of the decision‐making rationales around accounting performance measurement (PM) adoptions in Finnish municipalities. Previous studies informed by new institutional sociology (NIS), have tended to assume that accounting PM adoptions occur because of either “rational” or “institutional” reasons. The accuracy of this “polar” view is empirically analyzed in this paper (as called for by Ribeiro and Scapens).

Design/methodology/approach

Survey data (199 responses, 48 per cent response rate) were analyzed with factor analyses using, for example, SPSS and LISREL programs.

Findings

The decision‐making rationales (factors) around Balanced Scorecard (BSC) adoption were labeled “mimetic”, “rational” and “normative‐experimental”. Mimetic rationale correlated negatively with the other factors.

Research limitations/implications

The data was small. Further, as case studies and LISREL diagnostics often suggest, there may be other forces involved in PM adoption related decision‐making.

Practical implications

Understanding the interplay of the various pressures may facilitate the management of PM development projects.

Originality/value

Rational and institutional rationales are opposed also in the Finnish public sector (corroborating DiMaggio and Powell), but this “polar” view needs to be amended with individual or “experimental” aspects (corroborating Granlund). Acknowledging all three rationales refines public sector PM adoption literature (Lapsley and Wright). Finally, the rationales were interrelated, i.e. able to interact or counteract in PM adoption related decision‐making.

Citation

Ilmari Rautiainen, A. (2009), "The interrelations of decision‐making rationales around BSC adoptions in Finnish municipalities", International Journal of Productivity and Performance Management, Vol. 58 No. 8, pp. 787-802. https://doi.org/10.1108/17410400911000417