Title

Product diversification: The need for innovation and the role of the balanced scorecard

Document Type

Journal Article

Faculty

Faculty of Business and Law

School

School of Accounting, Finance and Economics

RAS ID

13097

Comments

This article was originally published as: Jarrar, N., & Smith, G. M. (2011). Product diversification: The need for innovation and the role of the balanced scorecard. Journal of Applied Management Accounting Research, 9(2), 43-60. Original article available here

Abstract

This paper tests the benefit of contemporary approaches to performance measurement systems represented by the Balanced Scorecard (BSC) to diversified organisations. Product diversification relationships, embracing both innovation and performance, were examined in a structural equation model, where the BSC is treated as an endogenous variable. We find product diversification to be significantly associated with the use of the BSC. The BSC is shown in turn to significantly associate with organisational innovation, the use of management initiatives of total quality management (TQM) and just in time (JIT) and performance.