Manufacturing strategy and performance measurement system design

Deposited with permission of the author. © 1998 Dr. Anne M. LillisThis study explores the link between strategy and the use and design of manufacturing subunit performance measures by profit centre managers. More specifically, it examines the relationship between manufacturing competitive strategy and 1. relative reliance on financial and non-financial performance measures for manufacturing management control 2. the way cost benchmarks used in financial performance measures are constituted to integrate non-financial dimensions of performance. These links between manufacturing strategy, reliance on performance measures and constitution of financial benchmarks are examined also for implications on performance measurement system effectiveness. Data were collected using a semi-structured interview in conjunction with a structured questionnaire administered to 36 profit centre managers and 12 manufacturing managers in 36 manufacturing firms in Victoria, Australia. (Open document for complete abstract