ratings, based on t-tests at a 10% two-tailed probability
level. There is a significant difference for at least one
comparison per measurement attribute. Three features
of these results are particularly worthy of note.
First, as compared to financial measures, nonfinancial
measures are seen by the manufacturing managers as
providing the greatest encouragement for risk taking
and innovation and also are more effective at curtailing
short-termism and gamesmanship. These differences
are in line with popular belief. Compared to both financial
and nonfinancial measures, subjective measures are
seen as being the most effective at curtailing shorttermism
and gamesmanship.
Second, in contrast to popular claims, nonfinancial
measures are not seen as significantly different from
financial measures in their contribution to operational
and strategic decision making and their capacity to align
intra- and interdepartmental objectives. Surprisingly,
subjective measures are seen as being the least effective
among the three measurement types along these
dimensions (except for “strategic decisions”). A plausible
explanation for this is that the strongest weight for
performance evaluation is still being placed on financial