Title: Business strategy–balanced scorecard measures alignment: an empirical test of its performance implications using systems approach

Authors: Ruzita Jusoh, Daing Nasir Ibrahim, Yuserrie Yuserrie

Addresses: Faculty of Business and Accountancy, University of Malaya, Kuala Lumpur 50603, Malaysia. ' School of Management, Universiti Sains Malaysia, Penang, Malaysia. ' School of Management, Universiti Sains Malaysia, Penang, Malaysia

Abstract: This study empirically examined the alignment between business strategy and the use of balanced scorecard (BSC) measures and its impact on firm performance. Alignment was conceptualised according to the systems approach as proposed by Drazin and Van de Ven who defined it as the internal consistency of multiple contingencies and multiple structural characteristics. Given the importance of non-financial performance measures in providing better indicators of performance, this study intends to address that, regardless of which business strategy firms emphasise, firms would rely on using multiple performance measures (both financial and non-financial measures) in their performance measurement system. Overall, the results indicate that the effect of alignment between business strategy and all four dimensions of BSC measures usage on non-financial performance is prominent among both high and low emphasis of business strategy. Hence, there is support found for the systems approach to fit.

Keywords: Malaysia; balanced scorecard; systems approaches; business strategies; alignment measurement; firm performance; Robert Drazin; Andrew Van-de-Ven; internal consistency; multiple contingencies; structural characteristics; non-financial performance measures; performance indicators; globalisation; business advancement.

DOI: 10.1504/JGBA.2009.031694

Journal for Global Business Advancement, 2009 Vol.2 No.4, pp.328 - 347

Published online: 19 Feb 2010 *

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