Performance measurement systems in small and medium-sized enterprises and family firms: a systematic literature review

A literature review on the impact of digitalisation on management control

Digitalisation affects management control (MC). It leads to changes in the way MC activities are organised, performed and analysed. Companies of all industries, locations and sizes have to adapt their MC to digital circumstances, starting with the understanding and delimitation of MC tasks, through the modified application of MC instruments and the consideration of behavioural aspects of MC, to the organisation of the MC function within the company. This paper presents a systematic review of the literature according to Tranfield et al. (Br J Manag 14:207–222, 2003), focusing on the impact of digitalisation on MC. A comprehensive overview of scientific literature is provided by reviewing 166 highly rated accounting journals (based on multiple international journal ratings) and analysing 116 articles from January 2000 to August 2022. Based on the MC framework developed by Guenther (J Manag Control 23:269–290, 2013), the identified studies are categorised into the following research dimensions: tasks, instruments, organisation and behavioural aspects. Multiple studies highlight the continuous development of the MC function under the impact of digitalisation, including the extension of MC tasks, the adaptation of existing MC instruments and creation of new MC instruments, positive and negative behavioural aspects of digitalisation on MC and the establishment of new MC organisation models. In addition to the qualitative content analysis, this literature review also includes an analysis of the methods applied and illustrates their changes over time. This study reveals research gaps in relation to the current MC research and presents potential starting points for future research.

Sustainable performance in tourism SMEs: a soft modeling approach

Purpose

This paper aims to present a model to incentivize sustainable performance (SUP) in small- and medium-sized tourism by strengthening inner relations to adapt to a complex environment.

Design/methodology/approach

The authors adopted the systemic approach complementing analytic, tourism, partial least squares path modeling (PLS-PM), social network analysis (SNA) and systemic approach tools as follows: frame the problem through the soft systems methodology and SNA and identify the conflicting relationships; apply PLS-PM to validate the model; and propose new interactions for small- and medium-sized enterprises conducive to SUP based on the viable system model.

Findings

Considering the results, the authors pinpointed factors and relationships managers can address to foster SUP, highlighting the need to reinforce feedback loops and reduce inconsistencies between primary operations with coordination and management mechanisms.

Research limitations/implications

This work is limited to the organizational domain. Although the results apply to the Mexican context, this could be overcome using methodological complementarity to extend the ideas to other organizations.

Practical implications

This study invites discussing methods and viewpoints for rethinking SUP because of multiple factors. This requires adopting methodological complementarity to generate alternatives and reconfiguring inner organizational interactions.

Originality/value

The model captures minimum but sufficient components advising leaders about SUP. This proposal differs from previous studies because it suggests exploiting methodological complementarity to capture the insights of key operative actors to conceive the model. Hence, the authors suggest new relations among organizational factors so managers can develop strategies for adaptability.

Sustainability in Small and Medium-Sized Enterprises: A Systematic Literature Review and Future Research Agenda

Main aim: This paper examines the main topics of research in the literature studying the topic of sustainability in small and medium-sized enterprises (SME), and aims at presenting a future research agenda. Method: We conducted a systematic literature review based on articles published between 2000 and 2020. From an initial set of 88 papers taken from WoS in the period under analysis, 42 papers were effectively analyzed. Main results: The results of an in-depth reading reveal four clusters representing the main topics of research in the field: sustainability and SMEs’ performance; green and environmental management issues; social and cultural issues and their impact on sustainability policies; values, skills, and capabilities. Key findings suggest that the following angles of research appear to be underexplored: theoretically grounded research; research using large samples; articles examining sustainability reporting; research looking into non-manufacturing sectors; work examining settings in developing countries; research undertaking international comparisons; articles exploring the complementarity between the literature on sustainability in SMEs and on family-owned businesses; and the influence of the social and cultural context on SMEs’ engagement with sustainability. Main contribution: This paper offers insights to academia, practitioners, and policy makers to help SMEs engaging with sustainability and may assist also the latter to develop strategies to improve SMEs’ social and environmental reporting. Given the current pandemic crisis, and the urgency for sustainable business practices, we expect to contribute to expanding knowledge in this field of research.

The use of non-financial performance measures for managerial compensation: evidence from SMEs

This study explores the relationship between contextual variables—strategy, perceived environmental uncertainty (PEU), and decentralization—and the use of non-financial performance measures (NFPM) for managerial compensation in small and medium enterprises (SMEs). Using questionnaire data from SMEs’ managers, we find that the use of NFPM is positively associated with PEU hostility and decentralization. Furthermore, our study shows that these results are mostly driven by CEO’s compensation (in comparison to non-CEOs compensation) and family firms (in comparison to non-family firms). Finally, our analyses reveal that the use of different types of NFPM (customer-oriented, employee-oriented and operations-oriented) is associated with distinct contextual variables. Particularly, customer-oriented NFPM are negatively related to PEU dynamism and positively related to decentralization, while operations-oriented NFPM are positively related to PEU hostility.

Is small and medium-sized beautiful? The structure and evolution of family SMEs research

Purpose

The field of scientific research on small and medium-sized family businesses has been growing exponentially and the aim of this paper is to systematize the body of knowledge to develop an agenda for the future.

Design/methodology/approach

Adopting comparative bibliometric analyses on 155 articles (from 1989 until 2018) the authors provide a systematic assessment of the scientific research about small family firms, unveiling the structure and evolution of the field. Bibliographic coupling, co-citation analysis and co-occurrence analysis are adopted to identify the most influential studies and themes.

Findings

Four clusters of research are reviewed: succession in family SMEs, performances of family SMEs, internationalization of family SMEs and organizational culture of family SMEs.

Originality/value

This paper contributes to the field of family SMEs by providing a systematic analysis of the scientific knowledge. Reviewing those clusters allows to providing avenues and reflections for future research and further practice.

Performance Measurement System: Implementation Process in SMEs

There is still a considerable interest in the topic of business performance, both in scientific community as well as in managerial praxis. Especially, the area of performance measurement system (PMS) and its implementation is forming a considerable scope for improvement. However, the research of PMS implementation in small and medium-sized enterprises (SMEs) have been underestimated. Despite the significant contribution of SMEs to economic growth, employment share or predominance of SMEs over large companies, a very small amount of theoretical and empirical researches has been carried out focusing on implementation of PMS in SMEs. This paper is addressing the readiness and successfulness of SMEs in PMS implementation. The aim of our research was to analyze the process of PMS implementation in SMEs and to identify factors that influence the success and satisfaction with implemented PMS and to identify problematic factors that cause failure, dissatisfaction and create limits to PMS application. Sample of our research consisted of 336 SMEs operating in Slovakia of various ages, sizes, and different approach to performance measurement. Based on results of our research, we created suggestions and a set of the key success factors to each phase of PMS implementation process that respect the specifics and nature of SMEs. Within each phase, we found evidence that several factors significantly raise the potential of successfulness of PMS implementation, and others, in contrary, are contributing to the unsuccessfulness.

Managerial Controls in Private Family Firms: The Influence of a Family’s Decision Premises

In most studies, the affiliation of the manager (family-affiliated or non-family affiliated) and supposedly related behavior (agent or steward) is considered the sole antecedent to explain a family business’ (non) professionalization of managerial controls. This paper, based on Luhmann’s new system theory, examines whether a family’s decision premises influence the design of managerial controls in family firms in addition to a manager’s family affiliation status. Using survey data of 135 large and medium-sized Brazilian family firms and testing the hypotheses with SEM, this study provides evidence that a family’s decision premises significantly influence the design of managerial controls in family firms. This study provides evidence that when a family’s intention to transfer the firm to next generation (TGO) is high, more formal controls, as well as controls of a more participative nature are adopted in a family firm. Moreover, the results do not indicate that the level of family involvement in management affects the design of controls in firms with high TGO. The results only showed a significant relationship between a family’s intention to control and influence (FCI) the firm and the absence of participative controls. In addition, these findings also illustrate that each single family-induced decision premise has the potential to explain family firm behavior, since each of the two premises considered in our study is related to a different design of the controls adopted by the family firm.

The Mediating Role of Business Strategies between Management Control Systems Package and Firms Stability: Evidence from SMEs in Malaysia

The aim of the current study was to ascertain the influence of a management control systems (MCS) package on a firm’s sustainability with the help of mediating variables such as differentiation and cost leadership strategy in Malaysian small and medium enterprises (SMEs). Data were collected from managers working in Malaysian SMEs. A total of 384 questionnaires was finally used for analysis using SmartPLS 3.8.2. Area cluster sampling was used for data collection, and seven out of sixteen clusters were selected randomly. These included Selangor, Johor, Kuala Lumpur, Sabah, Penang, Sarawak, and Perak because these seven states cover 73.9% of total SMEs. Structural equation modeling (SEM) was used to test the hypotheses. Confirmatory factor analysis (CFA) was also used to examine the reliability and validity, and structural model assessment was used to test the relationship between variables. Findings revealed that an MCS package had a positive influence on a firm’s sustainability, cost leadership, and differentiation strategy. Moreover, cost leadership and differentiation strategy have a significant and positive influence on a firm’s sustainability. In addition, cost leadership strategies and differentiation strategies significantly mediate between the MCS package and a firm’s sustainability. This research assesses the influence of the MCS package through cost leadership and differentiation strategy on a firm’s sustainability of Malaysian SMEs. It helps top management to focus on the MCS package and business strategies in attaining a firm’s long-term sustainability. Finally, research recommendations discuss that the present study helps future researchers and academicians.