Assessing the Existing Performance Measures, & Measurement Systems in Developing Countries: An Ethiopian Study

The global integration and rapid applicability of supply chain concepts in manufacturing industries creates both opportunities and challenges for developing countries. The developing countries are becoming more open to adapting and accepting Western business practices. One of the important issues in this context is the use of the standard performance measurement systems. In the current literature, the capability to measure the performance of manufacturing industry operations can be seen as an important prerequisite for improvement. Companies have increased the capabilities of their performance measurement systems. The manufacturing industries in developed countries have been developed and implemented successfully multi-dimensional performance measures, and measurement systems for their business success. Whereas research results and data related to developing country's state of performance measures are very minimal. With the recent global integration and economic relevance of developing countries, we investigated the level of performance measurement systems in Ethiopian. The paper presents the existing practices in performance measures, and measurement systems based on case studies on twelve companies and questionnaire survey on thirty two companies’. A survey and case study results show that manufacturing industries still largely use financial and productivity performance measures. Despite the powerful advantages of performance measurement, it has not been widely implemented in the manufacturing industry in developing countries. The current performance measurement systems have faced different challenges what they did not encounter in developed nations companies.

[1]  A. Gunasekaran,et al.  A framework for supply chain performance measurement , 2004 .

[2]  Maurice Gosselin.  An empirical study of performance measurement in manufacturing firms , 2005 .

[3]  Jennifer S. Holmes,et al.  Reforming Government Agencies Internationally: Is There a Role for the Balanced Scorecard? , 2006 .

[4]  James E. Austin,et al.  Managing in developing countries : strategic analysis and operating techniques , 1990 .

[5]  K. Msimangira,et al.  Purchasing and supply chain management practices in Botswana , 2003 .

[6]  Jung Lyu,et al.  The performance evaluation of SCOR sourcing process--The case study of Taiwan's TFT-LCD industry , 2008 .

[7]  P. Jana,et al.  An investigation into Indian apparel and textile supply chain networks , 2010 .

[8]  M. L. Singla,et al.  Apparel manufacturing: a strategy for productivity improvement , 2003 .

[9]  Shlomo Globerson,et al.  Issues in developing a performance criteria system for an organization , 1985 .

[10]  M. Sharma,et al.  An integrated BSC‐AHP approach for supply chain management evaluation , 2007 .

[11]  Marco Alberti,et al.  A framework to assess performance measurement systems in SMEs , 2010 .

[12]  Umit Bititci,et al.  Integrated performance measurement systems: a development guide , 1997 .

[13]  Warren H. Hausman,et al.  Supply Chain Performance Metrics , 2004 .

[14]  Hongwei Ding,et al.  A SCOR-Based Framework for Supply Chain Performance Management , 2006, 2006 IEEE International Conference on Service Operations and Logistics, and Informatics.

[15]  A. Gunasekaran,et al.  Performance measures and metrics in a supply chain environment , 2001 .

[17]  Alfred J. Nanni,et al.  The New Performance Challenge: Measuring Operations for World-Class Competition , 1990 .

[18]  Angappa Gunasekaran,et al.  Information systems in supply chain integration and management , 2004, Eur. J. Oper. Res..

[19]  André de Waal,et al.  Is performance management applicable in developing countries?: The case of a Tanzanian college , 2007 .

[20]  Taco Elzinga,et al.  Behavioral factors influencing performance management systems' use , 2009 .

[21]  K.K.B. Hon,et al.  Performance and Evaluation of Manufacturing Systems , 2005 .

[22]  Andy Neely,et al.  Management Learning Not Management Control: The True Role of Performance Measurement? , 2006 .

[23]  Kevin McCormack,et al.  Linking SCOR planning practices to supply chain performance: An exploratory study , 2004 .

[24]  Andy Neely,et al.  Performance measurement system design , 1995 .

[25]  Sunil K. Sheoran,et al.  A review and analysis of supply chain operations reference (SCOR) model , 2004 .

[26]  Felix T.S. Chan,et al.  Feasibility of performance measurement system for supply chain: a process‐based approach and measures , 2003 .

[27]  F. Ohemeng.  Constraints in the Implementation of Performance Management Systems in Developing Countries , 2009 .

[28]  K. Msimangira,et al.  International supply chain practices in developing countries: A study in Tanzania , 2009 .

[29]  I. Chen,et al.  Towards a theory of supply chain management: the constructs and measurements , 2004 .

[30]  Samuel H. Huang,et al.  Computer-assisted supply chain configuration based on supply chain operations reference (SCOR) model , 2005, Comput. Ind. Eng..

[31]  Lie-Chien Lin,et al.  An integrated framework for supply chain performance measurement using six-sigma metrics , 2010, Software Quality Journal.

[32]  Thomas F. Burgess,et al.  Traditional or contemporary? The prevalence of performance measurement system types , 2007 .

[33]  Hau L. Lee.  Managing supply chain inventory: Pitfalls and opportunities , 1992 .

[34]  R. V. Hoek,et al.  “Measuring the unmeasurable” ‐ measuring and improving performance in the supply chain , 1998 .

[35]  H. M. Abdelsalam,et al.  Major variables affecting the performance of the textile and clothing supply chain operations in Egypt , 2009 .

[36]  R. Bheda.  PRODUCTIVITY IN INDIAN APPAREL INDUSTRY: PARADIGMS AND PARAGONS , 2002 .

[37]  R. Kaplan,et al.  The balanced scorecard--measures that drive performance. , 2015, Harvard business review.

[38]  R. G. Norman,et al.  Productivity measurement and incentives , 1972 .

[39]  Umit Bititci,et al.  Dynamics of performance measurement systems , 2000 .

[40]  Brian H. Maskell,et al.  Performance Measurement for World Class Manufacturing: A Model for American Companies , 1991 .

[41]  David M. Currie,et al.  Implementing a performance measurement system in Croatia , 2011 .

[42]  David M. Currie,et al.  From IT to BSC: The Importance of Culture in Implementing a Performance Measurement System in Croatia , 2009 .

[43]  Zengyou He,et al.  A SCOR Reference Model of the Supply Chain Management System in an Enterprise , 2008, Int. Arab J. Inf. Technol..

[44]  A. Neely.  The performance measurement revolution: why now and what next? , 1999 .

[45]  D. Lambert,et al.  SUPPLY CHAIN METRICS. , 2001 .

[46]  Rajat Bhagwat,et al.  Performance measurement of supply chain management: A balanced scorecard approach , 2007, Comput. Ind. Eng..

[47]  D. Magder.  Egypt after the Multi-Fiber Arrangement: Global Apparel and Textile Supply Chains as a Route for Industrial Upgrading , 2005 .

[48]  R. Dorf,et al.  The Balanced Scorecard: Translating Strategy Into Action , 1997, Proceedings of the IEEE.

[49]  A. Neely.  The evolution of performance measurement research: Developments in the last decade and a research agenda for the next , 2005 .

[50]  B. Beamon.  Supply chain design and analysis:: Models and methods , 1998 .

[51]  N. Khalifa,et al.  Supply chain challenges in developing countries: Cross industry case studies , 2008, 2008 7th IEEE International Conference on Cybernetic Intelligent Systems.

[52]  Benita M. Beamon,et al.  Measuring supply chain performance , 1999 .

[53]  M. J. Naude,et al.  Supply chain management problems at South African automotive component manufacturers , 2011 .

[54]  Jonathan Lean,et al.  Improving control through effective performance measurement in SMEs , 2001 .

[55]  Christof Schulte.  10.2 Supply Chain Operations Reference-Modell , 2012 .

[56]  Charles H. Feinstein,et al.  Total Factor Productivity , 1982 .

[57]  Andy Neely,et al.  A framework of the factors affecting the evolution of performance measurement systems , 2002 .

[58]  Andy Neely,et al.  The Performance Prism: The Scorecard for Measuring and Managing Business Success , 2002 .

[59]  R. Eccles.  The performance measurement manifesto. , 1991, Harvard business review.

[60]  Stefano Tonchia,et al.  Performance measurement systems - Models, characteristics and measures , 2001 .

[61]  Stefan Tangen,et al.  Demystifying productivity and performance , 2005 .

[62]  Angappa Gunasekaran,et al.  Supply chain management: Theory and applications , 2004, Eur. J. Oper. Res..

[63]  M. Saad,et al.  An investigation of supply chain performance measurement in the Indian automotive sector , 2006 .

[64]  R. Chenhall.  Integrative strategic performance measurement systems, strategic alignment of manufacturing, learning and strategic outcomes: an exploratory study , 2005 .