Team Performance Measurement: A System to Balance Innovation and Empowerment with Control

Abstract

A current highly competitive and rapidly changing business environment requires companies to continually innovate to survive. An increasing number of companies are using teams to leverage the knowledge and experience of their employees in order to improve quality, reduce costs and ‘delight’ the customer. The growing prevalence of teams signals the need to examine the adequacy of management accounting information and its use in performance measurement and control systems.

Some research has examined the impact of team empowerment on creativity and innovation, while other research discusses the sometimes-hampering role of performance measures in team environments. This paper contributes to this research, with two major goals. First, it discusses innovation and empowerment and examines how performance measurement can both encourage and hinder team performance. The second purpose is to propose a team performance measurement system using ratios based on activity-based management that seeks to encourage innovation and empowerment while maintaining a system of control.

Citation

Kennedy, F. and Schleifer, L. (2007), "Team Performance Measurement: A System to Balance Innovation and Empowerment with Control", Lee, J.Y. and Epstein, M.J. (Ed.) Advances in Management Accounting (Advances in Management Accounting, Vol. 16), Emerald Group Publishing Limited, Leeds, pp. 261-285. https://doi.org/10.1016/S1474-7871(07)16009-3