Loosely coupled performance measurement systems

Introduction This chapter reports on the loosely coupled performance measurement practices of a high-performing restaurant chain (Ahrens and Chapman, 2004, 2007). Over a period of four years we observed a series of initiatives aimed at “tightening up” the performance measurement systems of the case company. However, none of these initiatives resolved the desire for what the finance director towards the end of the research period called “unambiguous performance information”. Head office managers of all grades continued to demand performance measurement systems that allowed more comprehensive and detailed control over the operational decisions of restaurant managers. Whilst it was easy to see in principle how such systems could have been implemented, successive working parties did not change them. This was not for lack of market competition, and it did not result in lower performance. Indeed, managers felt competitive pressures intensify during the research period, and still managed to increase both the market share and the profitability of the case company. What we were faced with was a high-performing company in a competitive industry that endeavoured to rectify the flaws of its performance measurement system, yet did not. We think that this case holds a lesson for those who are interested in performance measurement system implementation, because it combines high performance with a handling of performance measurement issues that would seem to violate an implicit cornerstone of much of the performance measurement literature.