Apprendre à oser ®
Friday 5 November - 14:00 –16:00 (Amphi 4)
“How management practices diffuse:
the Balanced Scorecard as a rhetorical machine”
Paolo Quattrone
(Instituto de Empresa)
Professor in charge of the seminar: Martin Messner (HEC Paris)
______________________________________________________________________________________________________________________
This document cannot be used without the agreement of the author
How management practices diffuse:
the Balanced Scorecard as a rhetorical machine
Cristiano Buscoa*, Paolo Quattrone b
a
b
University of Siena, Italy
IE Business School, Madrid, Spain
*
Corresponding author: [email protected]
Abstract
Research on the diffusion of management practices in and across organizations, economies, and societies
are in the midst of a ‘rhetorical turn’, that is, focusing on discursive strategies that facilitate diffusion per se and
also that naturalize diffusion processes. Recent studies have drawn upon rhetorical theories to highlight the role
of discursive justifications utilized by managers in making adoptions appear as a rational decision, thus drawing
on the persuasive nature of rhetoric. This body of work makes a strong case for the power of discursive narrative.
We expand this argument by looking at the Balanced Scorecard as a rhetorical ‘machine’, i.e. a visual inscription
which utilizes rhetorical methods to facilitate a continuous work of knowledge ordering and innovation,
communication and translation, and organizing. This focus helps developing diffusion research in organization
science in three directions. Firstly, it adds the role of the practice itself to that played by human actors and
institutional pressures, showing how adoption occurs in a network of diffused agencies. Secondly, it highlights
how practices which diffuse are able to intersect and mediate between contrasting agencies in this network thus
favoring the persistence of organizations and institutions. Finally, it helps understanding through what
mechanisms these practices manage to present a high degree of malleability while retaining some degree of
stability.
Key words: rhetoric; diffusion; Balanced Scorecard; management practices; adoption; actor-network theory.
Introduction
Interpreting the diffusion of management practices has been on the agenda of management and
organizational scholars for some time. Drawing on rational and functionalist arguments, some have
argued that these practices diffuse for the merits they have in bringing value to organizations (see, for
example, Cooper and Kaplan 1992, Katz and Shapiro 1987, Manz and Stewart 1997). However, it has
been noted how the relationship between diffusion and the presumed benefits to organizations that
adopt is not always linear or direct and sometimes the statistical significance is weak (see, for
example, Chenhall and Langfield-Smith 1998, Itmer et al 2002, with regard to Activity Based
Costing). Furthermore, approaches based on a rational actor model give too much explanatory power
to human agents and their ability to assess benefits derivative from the adoption (e.g., Strang and
Macy 2001) and too little to other contextual factors which are thus left at the margins of the
theoretical framework. Finally, Strang and Meyer (1993) outlined a critique based on the institutional
conditions of diffusion that focus on the ‘theorized’ nature of the object of diffusion, the complexlytextured feature of the context of diffusion, and the under-specified role of temporal process in
diffusion.
A substantial body of work on diffusions processes interprets adoption as ceremonial response
to external pressures in order to show a substantial degree of rationality in how the firm is run (e.g.,
Covaleski and Dirsmith 1991, Meyer and Rowan 1977, Powell and DiMaggio 1983). This form of
rationality helps the collection of financial resources (Pfeffer and Salancick 1978) and hides or, in
some cases, promotes other uses and roles that management practices may play within organizations
(Davila et al. 2009). In this vein, adoption can be also seen as the result of fad and fashion cycles
(Abrahamson 1991, 1996, Abrahamson and Fairchild 1999, see also Parush 2008) in order to be
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recognised as legitimated players in certain organizational fields. This perspective recognizes the force
of external pressures to adhere and respond to a clear institutional context in the explanation.
Several studies attempt to overcome the dichotomy of explanations created by these two
approaches to interpreting processes of diffusion. Barley and Tolbert (1997), for example, looked at
the micro processes of structuration (Giddens 1984) where individual agencies and social structure
both contribute to shaping processes of change and diffusion through sequences phases of action.
Tolbert and Zucker (1983) integrated rational and social perspectives into a two-step model where
actors adopt a practice initially based on technical and functional criteria and, subsequently, respond to
‘institutional’ processes of conforming to normative conventions and rules (see also Westpahal et al.
1997), to the force of state actors and others in distributing resources to ‘legitimate’ agencies, and to
processes of identity and emulation (Washington and Ventresca 2004). More recently, Kennedy and
Fiss (2009) argue how “both early and later adopters are affected by logics of efficiency and
legitimacy, because they complement rather than conflict with each other” (p. 898, emphasis in
original).
A new tradition of work develops a rhetoric informed and infused theory of diffusion (e.g.,
Green 2004, Sillince 2005, Suddaby and Greenwood 2005, for a review, see: Hartelious and Browning
2008, Sillince and Suddaby 2008). This tradition builds from early empirical studies (e.g., Zbaracki
1998, Zajac and Fiss 2004) and the renewed interest in discourse institutionalism (CzarniawskaJoerges and Sevón 1996, Hardy et al. 1998) and how discourse legitimacy strategies play a role in
institutional change (Suddaby and Greenwood 2005), industrial restructuring (Vaara et al. 2006),
change (Heracleous and Barrett 2001) and in mediating amongst multiple strategic goals
(Jarzabkowski and Sillince 2007). Green (2004) proposes a rhetorical theory of diffusion which seeks
to bring human agency back in the process by showing how “managers championing the adoption of
new practices provide discursive justifications that rationalize and legitimize the new practice’s
adoption” (p. 655) thus combining issues of efficiency and rationality with those of legitimation and
conformity to social rules and bringing the micro foundations of institutions back into theoretical
explanations.
Despite the progress of this rhetorical turn, some issues are still left unexplained by these
theory-refocusing efforts. The difficulties in discerning between the economic or social nature of the
diffusion process (see Lounsbury 2001) point to a much greater complexity related to the multiplicity
of issues at stake when dealing with the rationales underpinning processes of adoption and diffusion.
Palmer et al. (1993), for instance, show how the diffusion of the multidivisional form in the US could
be linked to a combination of economic, political and social factors. The work by Shenhav (1999)
highlights the role of engineering profession, rationalities and rhetoric in the diffusion of managerial
thinking. Similarly, Hoskin and Macve (1986) find in the pedagogical foundations of managerial
thinking the driving force for its spread. In a similar vein, Oakes et al. (1998) draw upon Bourdieu’s
notion of symbolic violence to show the pedagogical function that planning and budgeting practices
play in managing Canadian museums. Yet, if one links adoption decisions to the implementation
process “organizations face the task of integrating new practices into existing operations, technologies
and political agendas” (Kennedy and Fiss 2009, p 889) thus showing how these practices show a
multifaceted nature. These various rationales and agendas may well go beyond a need to pursue
economic technical efficiency or social legitimacy to simultaneously embrace political, social and
religious issues, as illustrated by Quattrone (2004) in the case of the diffusion of accounting and
accountability in the Society of Jesus of Early Modern Italy.
These complexities not only pose problems for identifying what kind of rationales underpins
adoption decisions but also question the nature of the practice itself which thus requires theorisation.
So, if in Lounsbury (2001) and Zbaracki (1998) management practices present a significant degree of
diversity due to institutional pressures, Cools et al. (1997) show how innovations are not stable during
the process of implementation and thus the rationale, nature and contexts for their implementation
change with time (Lounsbury 2007). Going back to the work of Strang and Soule, “this may lead
researchers to ask whether we are talking of the same object which diffuses or not. In fact, we
typically know that potential adopters are brought into contact with the diffusing practice but do not
know quite what they see. [This] inability to specify what is observed produces some theoretical
fuzziness about the microprocesses involved in diffusion” (Strang and Soule 1998, p. 269).
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Beyond those already sophisticated efforts to conceptualise diffusion dynamics in steps (e.g.,
Tolbert and Zucker 1983) or by blurring the distinction between adoption and implementation (see, for
instance, Orlikowski 2000), we propose to conceptualise institutional environments as more
fragmented and populated by contrasted and competing rationalities (Friedland and Alford 1991)
which are at work at the same time. As noted by Lounsbury (2007), such reconceptualization will have
to take on board concepts such as the translation of rationales and belief systems (Bartel and Garud
2009, Latour 1987; Czarniawska and Sevon 1996) and how the emergence of practices and their
diffusion happens thanks to a heterogeneity of actors which is hidden behind an apparent veil of
homogeneity.
As done by Green (2004), this paper intends to engage with these issues related to the
complexities of the diffusion of managerial practices by drawing on rhetoric. However, rather than
emphasizing agency, discourse, persuasion and managers’ persuasive skills in the diffusion process
(see also Abrahamson 1996, Sillince 2005, Zbaracki 1998), we also want to focus on ordering and
organising abilities that rhetorical techniques have. We intend to theorise management practices as
‘rhetorical machines’ (Bolzoni 1995, Carruthers 1990, 1998), i.e. visual inscriptions (see Latour 1991,
2005) which utilize rhetorical methods to facilitate a continuous work of knowledge ordering and
innovation, communication and translation, and organizing. ‘Rhetorical machines’ provide (in
different forms such as trees, wheels, and even physical spaces) organizing and mediating platforms in
that help users to invent new organizing solutions and creating new managerial knowledge which then
become legitimated justifications in procedures that support micro interactionist work (see Orlikowsky
1992; 2000, with respect to information technologies, and the notion of “semistructure”). Drawing
upon studies in literature researching on the historical intertwining of rhetoric with the art of memory
(see Bolzoni 1995, Carruthers 1990, 1998; Yates 1966) and combining these with insights from ActorNetwork Theory (Czarniawska and Hernes 2005, Latour 2005), we further develop a rhetorical view
of the diffusion of management practices which is based on the features of the practice itself and its
role as node in linking a network of micro agencies to the formation and change of macro institutional
pressures. Rhetoric machines, we will argue, draw on visual inscriptions, on their nature of method of
knowledge ordering, of medium of communication and mediation, and, finally, on their being
performable spaces where organizing activities can happen, to assume a multifaceted nature thus
opening up the Pandora’s box (Latour 1999) of explanations for diffusion patterns.
This shift in focus helps us to contribute to the literature on diffusion of management practices
in three ways.
Firstly, we bring back a further element to understand diffusion processes, that is, the practice
itself. Rather than assuming the existence of some functional quality of the practice diffusing, we will
argue that management practices conceived as rhetorical machines allows to place management
practices at the centre of a diffused network (see McFayden et al. 2009) where human actors interplay
with other (non-human) managerial techniques and technologies which all play a role in the process
and contribute to relationally define the nature and multiple roles of these practices in organizational
settings.
Secondly, we argue that management practices diffuse also because of their ability to provide
different solutions to managerial problems and heterogeneous rationales to justify and legitimise
decisions made, allowing them to intersect different organizational communities (Bechky 2003),
create common identities, memories and culture (Oslick and Rabbins 1998). This ability contributes to
the persistence of organizations and institutions, which survive not because they homogenise people’s
behaviour but because they allow growing degrees of diversity to coexist and generate innovation
(Chang and Harrington 2009). In other words, we argue that the diffusion of managerial practices is
strictly linked to their organising properties although these properties are very fungible and do not
assume any predetermined functional teleology.
Finally, a rhetorical view of management practices helps understanding through what
mechanisms these practices present a high degree of malleability while retaining some degree of
stability, enriching our understanding the nature, functioning, and mechanisms of engagement that
various forms of “boundary objects” (see Carlile 1992, 1994, Bechky 2003, Orlikowsky 2000, Star
and Griesemer 1989) show when contributing to effective organising attempts.
We illustrate these points by drawing on the analysis of a case study on the adoption of a new
Balanced Scorecard System (BSC) in a large Oil & Gas corporation in the Middle East. We utilise this
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empirical material to show how the BSC acts as a rhetorical machine, presenting the fours salient
features described above (nature of visual inscription, method of knowledge ordering, medium of
communication and translation, and performable space). These features, we will argue, are crucial in
guaranteeing a successful adoption process.
The paper is structured as follows. Next, we illustrate the theoretical framework adopted in this
paper, where rhetoric is viewed not only as an instrument of persuasion but intrinsically as a set of
detailed practices for knowledge ordering and discovery, communication and organization. Then, we
provide an overview of the rationale inspiring the choice for case study methodology and the related
notion of research validity that informs the paper. We then focus on the illustration of the four features
of the BSC as rhetorical machine. Finally, the last section summarizes the arguments, illustrates the
limitations of the paper and describes the implications of the study for further research.
Rhetorical machines: visual inscriptions as methods of knowledge ordering and innovation,
communication and translation, and collective organising. i
Green highlights the persuasive power of rhetoric and shows how to “be rational is to make
persuasive sense. Accordingly, the more persuasive the discursive reasons supporting a managerial
practice, the more rational its adoption (2004, p. 655)”. Indeed, rhetoric is mostly known as a
technique of persuasion concerned with language and discourse (e.g., Carruthers and Espenland 1995,
Zbaraki 1998, see also Hartelious and Browing 2008) and sometimes this meaning is accompanied by
a negative connotation. The persuasive power of rhetorical techniques is common to many
communication devices and emphasises the style used in the presentation of an argument to an
auditorium. This is why, for example, some studies have considered the ethos, pathos and logos as the
most fundamental concepts in rhetorical theory that can helps organizational theorists to understand
how managers convince and persuade various kind of audiences. However, all of these features relate
to one of the various canons in which classic rhetoric was sub-divided (Carruthers 1998): the elocutio,
that is the style of the presentation of an argument.
However, the elocutio, is only one of the main distinctive parts, or canons, in which classic
rhetoric is organized. The first of these canons is the inventio (i.e. the process of figuring out and
preparing the arguments to be dealt with); the second is the dispositio (when these arguments are
arranged in a coherent form), and; the third the elocutio, which indeed concerns the style of
communication and the rhetorical instruments to appeal to an audience for effective persuasion.
Studies in the field of literature (Bolzoni 1998, Carruthers 1990, 1998) provide a useful starting
point for exploring rhetoric’s organising properties. They have linked rhetoric to the art of memory in
the context of Medieval and Early modern times, expanding earlier attempts in this direction (notably,
Yates 1966), and providing insights for understanding contemporary activities such as innovation and
creativity. Carruthers, for example, wrote:
the goal of rhetorical mnemotechnical craft was not to give students a prodigious memory
for all the information they might be asked to repeat in the examination, but to give an orator the
means of wherewithal to invent his material, both beforehand and – crucially – on the spot.
Memoria is most usefully thought of as a compositional art. The arts of memory are amongst the
arts of thinking, especially involved with fostering the qualities we now revere as ‘‘imagination”
and ‘‘creativity” (Carruthers 1998, p. 9).
Rhetorical practices were thus not only means of persuasion but also classificatory and ordering
devices to aid memory, as memory was one of the main skills that a late Medieval and Early Modern
intellectual should possess (see Findlen 1994, Grafton 2009).
These techniques were often organised as rhetorical ‘machines’ (Bolzoni 1985) and took
different graphical forms. Amongst these, one may suit the aim of this paper: the rhetorical wheel (see
Toscanella 1569, Bolzoni 1985, pp. 65-73). Orazio Toscanella, in his treatise on the Armonia di tutti i
principali retori (‘Harmony of all the main orators’, 1569), discussed the features of rhetorical wheels,
their arrangements and use. He stated that these were to be arranged:
by always putting the principal subject in the middle of the piece of paper and then putting
around it all the principal things that this man can imagine […]. With this organization, you can
proceed to an almost infinite degree because [with] each word around [the given subject] you could
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similarly make a circle by considering the things that fall upon that word […] and this great
recollection is highly useful in increasing the amount of material (1569, pp. 54-56; quoted in
Bolzoni 1996, p. 68).
The rhetorical wheel is thus a circular pictorial representation of a given topic which is divided into
subtopics then linked to each other following a specific order and method. The orator is set to define
the topic to be discussed, e.g., love, and then prepare an inventory of cards, that is, a number of pieces
of paper upon which the orator can define those various subtopics that s/he believed could define the
concept of love (e.g., passion, affect, etc.). Then s/he could take the first, say, four pieces and place
them around the main subject to be discussed. This action could have happened physically (for
example when preparing the speech) or mentally (for instance when it was delivered), by recreating
the image of the wheel in the mind of the orator thus helping remembering the speech.
As argued by Bolzoni (1995, pp. xvi-ii), rhetorical machines, including the wheel, all presented
some common features.
Firstly, they made large use of written and mental visual images which aided orators to
remember the speech to deliver. Rhetorical machines were primarily, but not exclusively, inscriptions,
i.e. ‘‘transformations through which an entity becomes materialised into a sign, an archive, a
document, a piece of paper, a trace” (Latour 1999, p. 306). These signs could take the most diverse
forms: wheels, trees, hierarchies, and logical maps. These diagrams were part of the rhetorical
paraphernalia that orators utilised to define and ‘figure out’ the arguments to be dealt with (the
inventio). They helped memorizing these arguments and prepared the ground for an effective
communication and successful engagement of the audience (Bolzoni 1998).
In a second instance, then, rhetorical machines could be seen as visually oriented classificatory
methods which helped in giving a certain order to knowledge, arguments, discourses and, finally,
speeches. With reference to hierarchical diagrams, for example, Bolzoni commented:
The diagrams, the tables, and the large schemes in the forms of trees visualise the logical
path to be taken, and hence all of the material is presented to the eye reordered and reorganised
in a clear, effective fashion that is easy to remember (1995, p. xix; emphasis in original).
These ordering methods made of analysis the key principle for the organisation of knowledge. As the
etymology of the word suggests (from the Greek analyein, to break apart), analysis always implies a
division, a word that also hides a visual character as it derives from the Latin dividere “to force apart,
cleave, distribute” (from dis- “apart”; but also duo “two” + -videre "to separate”, but also “to view”).
Analysis is therefore intrinsically a visually oriented ordering method, for one breaks things down in
order to see them better, either in the virtual space of the mind or in the concrete space of a piece of
paper (be this a medieval ledger or a contemporary performance measurement technique such as the
BSC). In this sense, visual representations and methods for knowledge ordering and organising were
inextricably linked as much as rhetoric was to the art of memory (see Yates 1966, Carruthers 1990,
1998): all emphasised the role that inscriptions and visual records ii played in organising knowledge.
However, what these practices did was more than simply representing stored memories. They
bring back to the fore “what is no longer present” (Carruthers 1990, p. 222) and thus needs to be made
present again, i.e. ‘re-presented’. Remembering was always intertwined with reconstructing the logical
relationships between the mental and written images that Early Modern intellectuals prepared in
organising their knowledge.
Following this method, the definition of the theme positioned at the centre of the wheel to be
discussed and articulated, e.g., love, is always fluid, as it depends on what (and how many) cards
surround the middle of the wheel. The definition of content always happened in the context of the
oratorical practice, when a speech was delivered and could take different routes from those originally
planned and designed and therefore give a different meaning to the subject to be discussed. The
construction of the rhetorical wheel is always a creative process which leads the wheel to change and
mutate in composition, number, order, and relationships amongst cards, depending on the contingent
knowledge problems to be solved. With respect to this creative activity, Carruthers noted:
The Latin word inventio gave rise to two separate words in modern English [and other
languages]. One is our word “invention”, meaning the “creation of something new”. […] the other
[…] is “inventory”. This word refers to the storage of many diverse materials, but not a random
storage: clothes thrown into the bottom of a closet cannot said to be “inventoried”. Inventories must
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have an order. Inventoried materials are counted and placed in locations within an overall structure
which allows any item to be retrieved easily and at once (1998, p. 11).
Inventio is thus a precondition for inventing new knowledge and develop innovative arguments. If
while delivering the speech, an unexpected question from the audience could not be answered with the
subtopics initially chosen to surround the main theme to be discussed, the orator could go back
(physically or mentally) to the inventory of cards prepared earlier and choose an appropriate topic on a
card that can replace, or be added to, the existing ones. This process then favours the construction of
an argument to be used in the answer. And if there is no card which can help, a new one can be
created. This allows the user to appropriate this method and make the practice his or her own, as
through changing the cards around the centre the abstractness of the theme to be discussed seems to
evanish and the concept becomes concrete.
Rhetorical wheels are thus, and in a third instance, media of communication which create the
conditions for a translation of the knowledge they are supposed to communicate, that is, a
‘‘displacement, drift, invention, mediation, the creation of a link that did not exist before and that to a
degree modifies the original [design]’’ (Latour 1999, p. 179; see also Czarniawska 1997). Being an art,
more than a science aiming at the acquisition of transcendental truths, memory practices were not
intended to be objective and neutral representations which aseptically communicated a given and
immutable message. As suggested by Latour, representations, images and inscriptions, ‘‘are not the
world: they only represent it in its absence” (Latour 1987, p. 247). They instead mobilised action and
allowed the user to develop an associative ability, where knowledge is created by rearranging relations
between texts and images.
This translation ability drew on the capacity to create, order, and make logical relationships
between the various cards identifying the features of the theme to be discussed. These represented loci,
i.e., spaces, where information could be stored to be then retrieved and recomposed at will, depending
on always changing purposes (i.e. the Late Medieval and Early Modern intentions which Carruthers
studied with reference to the art of memory). Rhetorical machines as knowledge ordering devices
which helped deploy logical, persuasive and therefore rational arguments (Green 2004) had thus a
crucial spatial connotation. And, indeed, the etymology of words such as ‘rationality’ ‘ratiocinations’,
and ‘reason’ reveals their spatial connotation (from Latin ratio, ‘reason’ but more importantly, at least
at that time, ‘calculation’, and ‘account’, that is, a graphical space where records can be accumulated
for inventories of all kinds). Given that words have a history (Long, 2001), it is useful to remember
that Ratio did not mean only ‘reason’ as much as the Libro della ragione (the book of reason) did not
mean ‘‘‘Book of Logic’ but ‘Ledger”’ (Murray 1978, p. 205). In the Augustinian art of memory, for
example, the word ratio acquired a broader and more practical meaning, for the rationes ‘‘are not
reasons of the sort that engage a philosopher but ‘schemes’ or ‘ordering devices’ [...]. Latin ratio
means ‘computation’ or ‘calculation’ not reason in exactly our sense of the word” (Carruthers 1998, p.
33). Dealing with rationes, with rationalities, thus implied, and still implies, dealing with schematic
images, with the development of a calculative ability that involves the reorganization of spaces as
much as calculations with numbers. iii Rhetorical wheels allowed ‘re-presentations’ designed for being
open to interpretation, appropriation and translation, beyond any stable and ultimate form of objective
and univocal truth.
We are then back to the core of the link between persuasion and rationality that Green (2004)
and others have established in interpreting rationales for management practices’ adoption.
The analysis of the rhetorical wheel has highlighted that in the definition of what persuades
and thus counts as rational, visual inscriptions play an active role favouring the formation of such
knowledge in a dynamic process of ordering and organising which makes the theme to be discussed
fluid as it is always relationally defined.
This introduces us to the fourth feature rhetorical machines have: they are performable spaces,
that is, they are instruments which are designed to elicit users’ action by offering a space where
meanings can be constructed via the use of the machine. A meaning that is shaped by a shared visually
informed and schematic rationality but unstable as it is always subject to re-definition via various
forms of rearrangements (such as the displacement of cards around the wheel). The rhetorical wheel,
for example, does not provide any stable content and value based form of knowledge and rationality (it
does not state what is ‘good’ and what is ‘bad’). It rather provides a general method for ‘figuring out’
what count as ‘rational’, ‘good’ and ‘bad’, remaining at a superficial and abstract level that makes the
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practice suitable to travel across various organizational and specific contexts (Czarniawska-Georges
and Sevón 1996, Shalin-Anderson and Djelic 2004). As argued by Lawrence et al. (2002), rhetoric
provides an instrument of interaction which makes collaborative efforts to solve complex problems
possible.
Wheels, maps and logical cause-and-effect relationships are widely utilised in managers’ daily
life to make sense of their organisational worlds (Craig, 2000; Lowy and Hood, 2004) and all of them
constitute key elements of BSCs’ graphical designs and functioning. So, what insights can we gain
from the study of rhetorical machines to understand how management practices diffuse?
If we translate the arguments above into the context of managerial practices, the study of
rhetorical machines suggests that successful practices diffuse because they provide devices through
which the rationale for their adoption can always be re-invented and adapted to micro organizational
conditions, also within the same adoption process, the same organization and, more in general, within
the same spatio-temporal framework (Carruthers, 1990). What remains constant in this process of
diffusion is the nature of visual inscription, of method of knowledge ordering, of medium of
communication and translation and of performable space that allows various local agendas to coexist
within the same diffusion process. And it is this form of rationality, meant as schematic ordering (and
not as objective and functional rationale), that is shared amongst participants and constitute the macro
legitimating discourse in which microprocesses can take place, beyond any functional and stable
rationale for adoption (be this technical efficiency or institutional legitimacy).
As much as the Early Modern intellectual had to be versed in rhetoric and the art of memory to
be recognised as a legitimated citizen of that virtual community that was the Republic of Letters
(Grafton, 2009), the contemporary manager deciding on the validity and adoptability of a given
managerial practice, needs to share with the community s/he belongs a schematic understanding of the
world, a way of doing things. The rationale for adoption is then not in the practice itself. It is not the
inscription and the message that it conveys that makes adopters believe that they are making a rational
choice, but in the practice mobilised by this inscription, in the performance that it calls for (the
“orthopraxis”, Carruthers 1999). Reasons for adoption of management practices therefore are not in a
supposedly stable ‘text’ which functionally satisfies certain organisational or social demands, but in
the variety of performances that the practice allows through its nature of visual inscription, method of
ordering and innovation and medium of communication and translation.
Details on the case study and methods
The case concerns the implementation of BSC within MEGOC iv (see Busco et al. 2007). The
insights from the MEGOC case are based on a longitudinal study conducted by one of the authors.
MEGOC is a large corporation operating in the oil and gas industry with operations in exploration,
production, refining and marketing. It employs over fifty-five thousand employees and an additional
one hundred thousand outside contractors. The company is owned by the national government and the
revenues generated constitute a large part of the GDP of that country. MEGOC is divided into seven
major divisions (or business lines): Exploration & Producing; Gas Operations; Refining, Marketing &
International; Engineering & Operations Services; Law; Finance; and Industrial Relations. These
business lines are headed up by Corporate Heads at the Senior Vice President level, and all report to
the President & CEO. In addition, support functions such as Corporate Planning, Information
Technology, Human Resources and Management Services also report directly to the company
President & CEO.
From May 2003 to December 2005 and again in 2008 empirical evidence was collected through
interviews, observations, group discussions, participations in meetings and internal workshops. At the
outset of the study, MEGOC was in the midst of implementing a series of new tools and innovative
management systems (such as the implementation of a new Enterprise Resource Planning system and
the BSC) to support the brand new strategic direction formulated by the Board. For this reason, the
first round of interviews aimed at collecting information concerning the introduction of new corporate
strategic imperatives as well as the initial wave of BSC implementations within the organization. The
research began with preliminary meetings involving managers at Corporate Planning, and employees
of those Divisions that were presented as early adopters of the BSC, i.e. Engineering & Operations
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Services, Information Technology and Human Resources, or involved in the process of diffusing the
BSC within MEGOC, such as the Internal Consulting Department. These meetings provided the
background to the company and allowed us to collect various forms of documentation on the process
of the BSC’s adoption within MEGOC.
The first round of interviews tried to explore the reasons for adoptions, as well as the conditions
and the allies supporting the diffusion of the BSC within the organization. MEGOC is a vast
organization with diverse networks and it was immediately clear that the BSC implementation did not
necessarily follow the same pattern within all the divisions and departments. Subsequent rounds of
interviews were therefore devoted to explore and understand such diversity in dealing with the BSC
implementation. Among others, the case study focused mainly on the Finance and Industrial Relations
divisions.
Overall, the study comprised 49 interviews with managers and employees operating in various
MEGOC’s divisions (see Table 1). The interviews were open-ended to allow interviewees to elaborate
on the reasons behind the adoption of the BSC. The interviews typically lasted between one and two
hours. Certain individuals were interviewed more than once in order to clarify key issues which
emerged as the study progressed. To stimulate an open dialogue and avoid bias related to potentially
controversial or sensitive issues, it was decided not to record the interviews. However, extensive notes
were taken and transcribed immediately after each meeting. Additionally, documentary material,
including company history, brochures, newsletters and other published material were collected when
possible, and triangulated with the interviews.
[INSERT TABLE 1 ABOUT HERE]
Despite the length of time spent within the organizational context, researchers need to confront
with the impossibility of fully representing and understanding the object of their inquiry. This was also
a practical impossibility in the case of MEGOC due to the vastness of the corporation. Details on the
case study thus are provided here not to illustrate how close to the real case story the researchers have
been (cf. Yin 1984) but to offer insights on how the material collected was pertinent to the issues this
paper intends to address (i.e. shedding a different light on the reasons underpinning the adoption of
management accounting techniques) and how it helped the researchers to develop their way of seeing
the case, i.e. their theorization (see, among the others, Czarniawska 1997, Etzion and Ferraro 2010,
Eisenhardt 1991, Dyer and Wilkins 1991, Barley 1990). In MEGOC, as is often the case in real
business life, the implementation of the BSC rarely followed a linear pattern and, as it will become
clearer as its description unfolds, the BSC was enacted differently by the different actors within the
corporation. Every attempt to account for that is thus unavoidably a limited and partial story.
Paraphrasing Mol (1999), the BSC represents a complex object made by “different versions, different
performances, different realities that co-exist in the present” (p. 79). It was constantly re-defined in
practice through various perfomative acts in various organizational times and spaces. Therefore,
providing case study details in Table 1, for example, does not aim to illustrate that we got close to the
object under investigation and we were thus able to explain how it evolved ‘over time’. Our aim is
more modest, that is, providing details on how we sought to reconstruct the connections between the
BSC with other different practices and systems at work (Law and Singleton 2005) in a semantic
network of relations that created multiple spaces and times the richness of which is ontologically
difficult to account for (Czarniawska 1997).
The Balanced Scorecard as a rhetorical machine
8
Various works have already highlighted the rhetorical power of accounting and how this
contributes to its diffusion (see, for instance, Aho 1985, Arrington and Schweiker, 1992, Nahapiet
1988, Nørreklit 2003, Young 2003). Specifically, Nørreklit (2003) argued that the success of the BSC
is due to the persuasive power that its proponents and the technique itself are able to exert on the user.
Very little attention, though, has been devoted to the organising properties related to the rhetorical
ability of the BSC, and this is the aspect we are going to concentrate in the reminder of the paper
following the four features of rhetorical machines that we have identified in Figure 1.
On making performance measurement attracting at MEGOC: the Balanced Scorecard as visual
inscription
At the beginning of the new Century, MEGOC was under pressure for change. Some indicators
concerning the socio-economic conditions of the Country were not as florid as they used to and there
was a diffuse feeling that a better organizational integration would have contributed better to the
nation’s wealth. Senior MEGOC’s executives began thinking about solutions. One amongst these was
about redefining the management systems of the company and the processes and instruments through
which strategy is identified, communicated and executed. There was a diffused feeling that the
corporation lacked of integration, as this statement from one of the engineers exemplifies: “…each
business line is a kingdom on its own, we know that…”.
In 2002, following the call of the national government for some action to improve the local
economy, MEGOC’s executive management board redefined the strategic direction of the company in
order “to significantly increase its contribution to the country’s revenue needs and consistently
promote the development of the local economy” (MEGOC’s mission statement). The BSC was seen as
a solution to these problems. A manager in the Industrial Relations division stated: “[the BSC] was
presented and promoted in wall-charts and flyers as a framework to communicate strategic
performance expectations and help the company translate strategies into key objectives and initiatives
that drive behavior and performance”. The idea was for the BSC to contribute to the communication
and deployment of the redefined strategy in a number of divisions of MEGOC.
We are all familiar with the visual form of the BSC. It comes with four boxes and the circle in
the middle (see Figure 2). The strategy and vision of the corporation constitute the central core of the
BSC. For MEGOC, these represented the government imperative for making the company an
organization focused on a strategy of revenue growth and local community development, and were
translated into six strategic imperatives: 1) Transform Corporate Performance; 2) Optimize the
Corporate Portfolio; 3) Maximize Revenues by Capturing Oil Growth Opportunities; 4) Protect the
Future Market for Oil; 5) Leverage the Oil and Gas Resources to expand the National Economy; 6)
Prepare the Workforce for the Future.
As a senior manager of the Information Technology division explained: “Once these
imperatives were identified by the Board in 2002, several divisions, functions and departments began
the implementation of the Balanced Scorecard”. Among the other divisions of MEGOC, Engineering
& Operations Services (E&OS) was very committed to introducing the balanced scorecard framework.
An E&OS senior engineer suggested: “We contribute to the achievement of MEGOC’s strategic
imperatives by pursuing sixteen key objectives within the different perspectives, these are our
cornerstones to fulfill management expectations”. He continued: “the Balanced Scorecard became the
hub around which the 12 month Operating Plan and the 5 year Business Plan were structured and
developed… Every initiative and action in the plan has to find its path in the Business Line Strategy
Map to contribute to one of the six corporate strategic imperatives”(see Figure 2).
[INSERT FIGURE 2 ABOUT HERE]
However, E&OS leaders found that the corporate strategic imperatives were not easy to
communicate, and to link with the Division’s operations. The E&OS BSC team leader explained:
“Employees were often unaware of what the strategy meant to their personal behavior, and how they
could help in achieving the strategic objectives of the company”. For this reason, the E&OS BSC team
decided to develop interactive training sessions relying also on an animated BSC tree to offer an
accessible and engaging illustration of the E&OS strategy: employees could track the impact of
different simulated actions on the achievement of the company strategic objectives (see Figure 3).
9
[INSERT FIGURE 3 ABOUT HERE]
The E&OS BSC team leader commented:
We developed an interactive presentation based on a Balanced Scorecard tree to offer a
simple visual metaphor that associates the four elements of a tree – i.e., its roots, trunk, crown
and fruits – with the four dimensions of our Balanced Scorecard… During the internal training
sessions we strongly emphasized the inter-dependence of the four Balanced Scorecard
dimensions, we warned participants that if the roots are weak, the trunk will be unstable, the
crown small and the fruits poor… significantly, we stimulated the participants to interact with
the Balanced Scorecard tree, and to monitor the consequences of their actions and performances
for the health of the tree.
Together with E&OS, Human Resources (HR) and Information Technology (IT) were the
first divisions to pioneer the BSC within MEGOC. The BSC was used to downplay the relevance
of well-established accounting-driven practices within MEGOC, such as budgeting and variance
analysis. The following is the remark of an IT manager responsible for a knowledge management
program labeled ‘shared values’. They were aware that what produced value was intellectual and
knowledge capital rather than physical resources:
Employees’ capabilities and motivation, information technology, customer relationships
and quality improvements represent the main ground to improve our contribution to the
Government and the community. In this context, the annual budget exercise is not sufficient
anymore to manage effectively such diverse resources at work. Financial metrics alone are
inadequate to drive the organization when so much of the value creation comes from things
other than inventory, plant or equipment – have you seen our [strategy] map? (he asked one of
the researchers conducting the interview, emphasis added)”.
The BSC was seen as the ideal instrument for the HR division to develop what an HR manager called
a “strategy-driven knowledge management system” in order to offer the “deserved strategic visibility
to fundamental but abstract concepts and initiatives such as human capital and shared values” (as
stated by an HR manager).
This need for making things visible is not uncommon when new strategies, new technologies,
and new performance measurement systems are about to be introduced in organizations. However, as
illustrated with respect to words such as ‘efficiency’ (Hansen and Mouritsen 1998), these concepts
necessitate a lot of work to leave that feature of abstractness that they present and be made concrete
enough to become working practices.
This abstractness also means that the concepts at the core of MEGOC’s vision could be
appropriated by several divisions. In a sense, the fact that they were not clear was an advantage as
managers could project into them what they believed was important for both their division and the
corporation as a whole. The process of visualization through trees, maps and the like helped as it
offered managers something concrete and, at the same time, vague enough to which they could relate
to visually imagine what the strategic imperative meant. Interestingly, for example, BSC advocates
from the HR Division found a similar interest in IT managers who, despite a strong commitment on
Enterprise Resource Planning system implementation, described the BSC: “as an interesting
framework to make the computer-based platform as strategic as possible from the very start”(an IT
manager). In a similar vein, an HR manager commented on how the BSC gained consensus within HR
as several senior managers agreed “that its introduction helped the HR function to be back on the
Company map”. It seems clear that the BSC become an interesting object to be performed within
MEGOC not because it had a univocal purpose to achieve but because it could be appropriated by
various users and for various reasons thanks to the simplicity of the visual representation and
metaphor.
10
In summation, E&OS leaders believed that providing a simple, interactive, visual metaphor (like
the BSC tree, for example) could help employees grasp the essence of the strategy more quickly, retain
more of its elements and feel more inclined to reach the goals articulated in the tree metaphor. This
playful and interactive way of communicating the strategy in a simple visual metaphor illustrated its
implications for all employees and caught their attention. Being a graphical visualization, the BSC
offered a necessarily simplified view of much more complex processes, visions, actions and targets. It
provided something to which controllers and organizational employees could relate and an easy
reference point for subsequent conversations among employees. It prompted all kinds of activities
(e.g., presentations and workshops) where the BSC was used to track the current status of strategy
implementation. The BSC’s boxes could thus mobilize discussion. They offered a starting point,
something to play with and to invent new forms of finding and solving old and new problems. They
worked as classificatory devices and provided an order through which abstract visions and strategies
are made real and could be linked to performance. This is what we explore in the following section.
Ways of engagements: The Balanced Scorecard as method of ordering and innovation
Following the Board’s decision to clarify MEGOC’s strategy in terms of the six corporate
strategic imperatives, a number of BSC implementation teams were set up in the organization both at
the division and department levels. Each team was required to identify the mission, vision and
strategic imperatives of its area, and to link them with the corporate strategic imperatives. The jargon
of the BSC rapidly spread throughout the organization. Calendars, diaries, posters were some of the
means used to diffuse the idea of MEGOC as a strategy-focused organization. Walking along
MEGOC’s corridors it was quite common to find statements that tried to communicate the BSC’s
‘spirit’ as the following, the text of which is reproduced below and was posted on several walls of a
leadership development centre:
The Balanced Scorecard will help us translate our strategic imperatives into real action.
[…] The foundations of the scorecard are the mission, the vision and the strategies. Any
participating business line develops a Strategy Map that describes the way in which objectives
are linked in line with the strategic imperatives. It helps us understand our strategy by looking at
it from four perspectives: Financial, Customer, Internal Business, and Learning and Growth. It
provides a snapshot of the way in which activities are linked to and support each other. By
studying this map, you will be able to identify where you fit into the company’s plan for
realizing its vision.
In several divisions of MEGOC the BSC(s) and the associated strategy map(s) soon became
templates used to visualize and communicate the division’s objectives, key performance indicators,
and the specific initiatives that were about to be undertaken over a certain period. Within E&OS, the
BSC and the Strategy Map were developed by the BSC team in accordance with the Division leaders.
A senior member of this team commented: “The strategy map builds on our mission statement - the
reason we exist as an organization - which is to add value to [MEGOC] through the innovative
solutions developed by our people” (see Figure 4). Strategy maps and the BSC worked together in
making things clear for those who were to deploy strategies and visions. On the one hand, the Strategy
Map envisioned the many possible ways to add value within corporate and divisional strategic
imperatives – “there are several ways our people can contribute to value creation”, (senior manager
of the E&OS division). On the other, the associated BSC was a tool to select and measure key
performance indicators across a series of different perspectives.
[INSERT FIGURE 4 ABOUT HERE]
As you can see [said a senior manager pointing to a chart on the training room wall (see
Figure 5)], our key goal is to focus on customers’ needs. […]. Like a good strategy for a
winning soccer club, our strategy map is strong up the middle: goalie – midfielder – centre
11
forward. Therefore we have these eight objectives [again, pointing at the chart] locked within
cause and effect relationships with the aim to improve productivity and achieve ‘best-in-class’
performance. Then, there are eight more supporting objectives to achieve increased revenue
growth, to protect the oil market, to optimize the Corporate portfolio, and to support the national
economy. Altogether these sixteen objectives complete the high-level view of the strategy map
of the division.
[INSERT FIGURE 5 ABOUT HERE]
The rules of the game seemed rather clear:
These are the objectives that were highlighted in the 2003 E&OS Operating Plan
presentation. Horizontally the objectives are organized according to the four balanced scorecard
perspectives; vertically they are organized by strategic imperatives. Like any good map, it has
coordinates for both longitude and latitude! […] Strategy begins to be effectively translated into
action when every individual can identify with one or more objectives that describe his/her
participation in the workplace. A deeper connection or personal line-of-sight is made when
individuals share ownership of a measure that is critical to the achievement of one of the
objectives of the division. And this is up to them…” (E&OS senior manager – emphasis added).
The existence of these co-ordinates exemplifies BSC’s nature of method: like a map, the BSC makes
an inventory of the issues at stake and offers a series of options on how to get from one place to
another although the final choice on how to move from one place to another is with the traveler. The
BSC does not concretely tell the user what to do; it simply offers a way of doing it, that is, a method. It
concentrates on how doing things rather than on what needs to be concretely done. This ‘what’ is left
to the user to find, to ‘figure out’ and to imagine on the strategy map that the BSC provides.
The BSC as a method for making abstract management concepts real: the Industrial Relation
division and the invention of ‘integration’
Within MEGOC, the Industrial Relations (IR) Division pioneered the implementation of the
BSC long before the Government’s call to redefine the Company’s overall strategy in 2002. IR is a
service division such as personnel, employee relations, training, medical and community services,
government affairs, public relations, safety and industrial security. IR leaders perceive internal
customers satisfaction as a priority:
Our vision is to be recognized as an essential contributor to [MEGOC’s] business success
by providing reliable, timely and value driven services… Service to the Company is why we
exist and our success is tied to the success of our customers, who shall see us as a single
integrated service Division, and not as five/six separate departments (IR manager).
Despite a clear understanding of the need to be customer focused, IR employees had different
opinions concerning what it meant to be an integrated division and how this could translate into
valuable services for the rest of the corporation. As argued by a manager of the IR division:
Providing customers with value added services was the mission of our Division, this was
very clear to everybody… the problem was that we had different ideas concerning how to
achieve customer satisfaction, how to streamline critical support services, about the
consequences of possible outsourcing initiatives or of the creation of shared services units… it
was difficult for us to think in terms of an integrated Division and anticipate the impact of our
decisions on the workforce, the contractors, the local community, etc…
The IR manager praised the BSC introduction for having contributed to the process of
integrating the division. He recalled that the deployment of the BSC within IR was not
12
straightforward. However, after some discussions, meetings and presentations a BSC-team led by the
divisional BSC coordinator identified four relevant themes around which the BSC should have been
constructed:
we proposed Maximize Company Potential, Quality Services, Optimize Net Direct
Expenditures, and Asset Stewardship as the key themes to be monitored to fulfil our mission
[…] we also stimulated the identification of measures-owners at the department level to make
sure that the key objectives were tight to a meaningful set of indicators linked to the critical and
integrated business processes (a member of the IR BSC-team).
These four key themes and the associated objectives were the final result of an intense process of
negotiation among the different IR departments. Thus, when the six Corporate Strategic Imperatives
were released by the Board in 2002, IR faced a new challenge of re-adjusting the existing scorecard
along the new imperatives. A member of the IR BSC team commented:
I was a bit concerned when we had to re-organize our Scorecard in light of the new
Corporate Imperatives [...] I thought that the different interests and agendas would have led to
misunderstandings and fragmentation once again […] and, indeed, there were vigorous
discussions between the BSC team and the various departments before finalizing the current
strategy map […] this is likely to happen when you run hospitals, facility management, security
and aircrafts under the same roof […]. However, and I found it truly surprising, despite the
different views concerning the possible objectives and KPIs, we experienced a different attitude
during the meetings […] most of the people acted as they knew what they had to look for, they
were in search of sounds cause-and-effect relationships to feed a reliable strategy map.
Within IR the BSC sustained the process of divisional integration while, at the same time,
enabling diversity to survive and innovation to occur. This is the case of the Facility Management
department where the perspectives of the BSC, as well as its objectives, were developed and
redesigned taking into account the specific features of the section itself. An IR manager argued,
while sketching his thoughts on a white board in his office, emphasized that: “we were among the
first group to introduce the BSC with [MEGOC] and we strongly contributed to its diffusion
across the company [...] now we feel it is time to update its contents by including new
perspectives and objectives able to capture the new areas where we have to deliver to the
Government and the Board”. As he was running out of space on the white board, he continued:
“This is the case for the Health, Safety and Environment as well as Nationalization perspectives
[...]. Have a look at our second-generation scorecard […] it is still a work-in-progress but it is
staring to reflect those new areas where we have to deliver performance no matter what”. Figure 6
reproduces what the IR manager had sketched on the white board by the end of our conversation.
[INSERT FIGURE 6 ABOUT HERE]
During the development of the case study it soon became clear that MEGOC’s employees
constantly evoked BSC’s ability to enable imagination, that is, helped making links were not clear
before.
In the case of the IR division, for instance, MEGOC’s managers would all agree that their
division needed greater integration (and the same goes for the idea of ‘optimizing processes’ we
discussed earlier). However, many of the very same people would have their own views on how
integration meant and how it could be achieved. The BSC offered a method to them for combining
each others’ views. It allowed the same notion (e.g., integration) to be declined in different forms
13
(both in terms of what it meant in practice and how it could be made effective). Within the IR division
the need to consider customer satisfaction as the key priority was unquestioned: the problem was how
to make this a real set of daily practices. BSC’s ability to offer ways to combine sameness, i.e. the
notion of integration, and diversity, i.e. the various meanings managers gave to the concept, enabled
the BSC to be appropriated by the different participants through the performative acts which it allowed
them to experience and that they were happy to execute.
BSC’s visual inscriptions thus were more than simple representations. As much as it happened
with rhetoric’s inventio, they lead people to invent new solutions, new vistas on problems. The BSC
prompted a creative process which, as we will see later, involved also those skeptical finance
controllers who initially looked at the BSC as a threat, as they found that they could ‘invent’ and play
a new role within the organization thanks to the combinatory possibilities offered by the simple visual
form and links that the BSC provided.
The BSC and the Café conversations as medium of communication and translation: on how the
rationality of maps, wheels and cause and effect relationships informs problem solving
Previous sections already illustrated how translating the corporation’s strategy and vision into a
series of BSC performance indicators prompted, and was supported, by a constant process of
mediation (Latour 2005). Mediation though, does not happen in a vacuum as for this to happen it
needs some concrete platform. And, indeed, the fact that the BSC is marketed as a medium of
communication (Kaplan and Norton 1996), and the Latin etymology of the term (from medius) reveals
that it is always ‘in the middle’ and thus, as argued in the reminder of this section, able to bridge
different organizational agencies and make sure that difference coexists within a supposedly unitary
project.
In the case of MEGOC this mediation happened thanks to links established between the process
of implementing the BSC and various other activities which MEGOC put in place to support the BSC
project. In 2003, for example, the E&OS senior vice president promoted the Café 03, that is, a method
for fostering collaborative dialogue among large groups which resulted in over seven hundred
members from across the four E&OS departments gathering within an airport hangar (see Figure 7).
[INSERT FIGURE 7 ABOUT HERE]
The following year some of the key suppliers and customers of the division, as well as several
delegates from other business areas and divisions of MEGOC, gathered together with a large number
of E&OS employees for the “Café 04 - Creating the future, one conversation at a time”. E&OS’s
senior vice president, in opening the Café 04 with his ‘clarity of sight’ address, focused on a series of
motivating questions rooted around the company’s corporate strategic imperatives and the way to
achieve them (see Figure 8):
Why must we change? What is the reason? […] What is the corporate strategic direction?
Do you know it by now or is this the first time you have heard it? What does it mean to you?
[...] What are the things that [MEGOC] must do? What are our imperatives? [...] In E&OS we
have created a map, a strategy map, to help us go where the company needs to go. Do you see
how it aligns our direction? We are good problem solvers, what new ways of thinking do we
need to learn to create the future that we want?” (E&OS senior vice president, as quoted by an
E&OS senior manager during an internal seminar; emphasis added).
The E&OS Strategy Map featured many of the slides projected during the Café 04, and represented
one of the key resources and tool characterizing the Café conversations (see Figure 8). As explained
by an E&OS senior manager the stories, speeches, presentations, and choices that characterized the
14
conversations at the Café 04 “were informed by the scorecards jargon, and were built around strategic
themes and measures that really mattered to us”.
These were increasingly perceived as the essential link between E&OS’s strategic and operating plan
and their actual outcomes. As an E&OS senior manager emphasized:
The Café conversations offered opportunities to think and be different, and the Scorecards
and Maps were employed to describe and communicate these potential future actions and
behaviors.
[INSERT FIGURE 8 ABOUT HERE]
Through the Café conversations, rather than simply presenting top management prescriptions
and easy solutions, the BSCs and the associated strategy maps informed a process of inquiry,
reflection, and exploration that aimed to reinforce the understanding of what people can do to achieve
the corporate strategic imperatives. As reported by the E&OS senior manager, at the beginning of the
Café, the E&OS Senior Vice President envisioned two possible future scenarios, which he identified
respectively as empty pockets or smiling faces. He suggested:
The future is about the choices we make today […]. What are the stories our grandchildren will tell their children? I fear those stories will be empty pockets stories, full of despair.
I dream those stories will be filled with smiling faces that reflect a flourishing economy and
prosperity. The difference between those two possible futures depends on the strategic choices
we make today. Every day, we make hundreds of choices that could lead to either of these
stories. Please look carefully at your objectives, measures, targets […] With every decision, I
challenge you to ask yourself, ‘which future am I creating—empty pockets or smiling faces?’
The choice is ours.
He continued:
We asked participants to offer their individual perspectives and listen for what was
emerging in the middle of the table. We suggested they use the tablecloths and markers to create
a shared visual space through drawing their emerging ideas. Often the co-created images were
really worth a thousand words in showing the relationships between the different perspectives.
In this sense, the BSC works differently from a simple and neutral means of communication.
Rather than diffusing a given message the BSC lets this message emerge from the conversations
happening in the Cafés. The BSC does not provide answers to the problem of performance that
MEGOC experienced. It rather prompted questions and debate about these issues and on the possible
ways to make MEGOC enact and embody the strategic imperatives which initiated the change process.
It enabled a work of identity building (Alvesson and Willmott 2002) that was continuously supported
by the shared schematic rationality that infused the Balanced Scorecard rhetoric. A procedural
rationality which could be deployed in different forms, interpreted in various ways and therefore
appropriated by the user for a multiplicity of purposes as it did not convey any specific content leaden
performance measurement message but was open to mediation and difference.
From performance measurement to performing measures: the Balanced Scorecard as performable
space
At the end of an internal workshop on the BSC a member of E&OS BSC team, pointing at a
chart reproduced on Figure 10, ended the meeting with these words:
[…] and now it is up to you, and your department leaders to find the proper objectives
and measures to make sure you can orient yourselves on the [MEGOC] strategic map, and show
how you can add value along the longitude and latitude of the company strategy map (emphasis
added).
[INSERT FIGURE 10 ABOUT HERE]
15
As we have illustrated in the previous sections, the Balanced Scorecard and of the associated
Strategy Map, despite being instruments for performance measurement, do not clearly define what is
meant by ‘performance’. Rather, as Figure 10 testifies, they offer a clear space for performing the act
of defining key performance indicators, how they relate to each other and to the overall strategy and
vision. In this sense, the BSC, rather than being a performance measurement system, is in fact
performing measurement systems, that is, creates the conditions for organizational actors to perform a
play around themes such as ‘strategy’, ‘vision’ and ‘performance’. How these abstract concepts
become real depends on the features of this performance, on the actors, on how they relate to the
inscriptions and how these inscriptions prompt reflections in one direction rather than another. This is
also a performance in which other technologies and techniques for sharing knowledge play an active
role, as the example of the Cafés illustrated earlier testifies.
The adoption of the BSC: becoming a performable practice by attracting diversity
The BSC, as much as any other managerial practice in order to become something to which
people can refer to needs to offer a possibility for engagement, a space for action. Managers in the
E&OS Division, for example, were not trying make everything clear and rigid, and they were not
forcing anybody “to fall in love with the initiative of the month” (as an E&OS senior manager
claimed). Rather, they were trying to engage potential future users who could eventually come to see
the BSC as an opportunity for action. Thus, events such as the E&OS Cafés and internal workshops
and seminars, contributed to the diffusion of the BSC in a manner which was visually and
methodologically engaging. Within the Café conversations, as well as during the internal training
sessions we had the opportunity to attend, the logic and the jargon of the BSC infused the dialogues,
and helped the groups identifying and communicating potential solutions to the challenges faced by
the Country (slow local economy development, growing unemployment rate, low average income,
etc.) and by MEGOC (processes of sustainable value creation, need for integration, etc.). Eventually, it
was the simplicity entailed by the four perspectives of the BSC, as well as the visual appeal of the
strategy map that made these two techniques performable within MEGOC. The BSC is adopted not
because it forces users in certain directions, but because it leaves the potential adopters free to enact
the space which is offered within it.
There are two instances which exemplify this enabling power of the BSC as performable space,
of how the multifaceted nature of performing measuring systems allows users’ appropriation for
disparate purposes beyond the intention of the designer. For example, the BSC was able ‘to attract’
divisions such as Human Resources and Information Technology because of its ability to make visible
and tangible abstract concepts such as ‘human capital’. Equally, IT found in the BSC a good ally in
making organizational actors recognize the relevance of a recently introduced computer-based
platform, SAP. The reasons for which HR and IT found the BSC useful were quite different from
those of the E&OS division. If one had to define a function that the BSC plays within even the same
organization, this would prove difficult: a general theory about functionality should deny the existence
of a given rationale for the BSC existence and adoption: if any, the BSC is adopted exactly because it
does not have a specific function to play within an organization and this leaves it free to play many
roles at the same time.
A further example of this ability, and possibly the most striking of all, is given by the change in
attitude of the Finance division which was originally hostile to the idea of the BSC, assuming that it
would have downplayed the role and functionality of more conventional and established techniques
for measuring performance such as, for example, budgeting. Several members of the Finance Division
perceived the BSC as an ‘operational tool’ which some business lines were eventually implementing to
measure other kinds of performances under the supervision of the Corporate Planning area. Finance, at
least initially, interpreted the BSC as a non-core initiative and, most importantly, as potentially
disrupting of the existing (accounting-driven) working practices. The skepticism of the employees of
the Finance division surfaced clearly in the interviews:
I know some business lines are implementing the Balanced Scorecard [...], but we do not
get involved with that, we don’t even have our own scorecard […] Ultimately, what is the
16
linkage between the scorecard and the budget? I do not see it, yet. Here the budget is the king…
We do not flex the budget: once it is finalized, that’s it! […] So we better concentrate on
budgeting [...]. Indeed, you can say we focus on one perspective [financial], and we are happy
to leave the other three to the rest of the company!” (Senior accountant; emphasis added).
During 2005, the ideal of better integrating the various divisions of MEGOC was still top of the
agenda. Given its initial hostility to the Balanced Scorecard, the Finance division displayed an active
role in fostering cooperation and knowledge sharing across the company. It developed a series of
workshops tailored to illustrate the importance of using financial metrics and Finance experts to
achieve effective organizational integration. In so doing, the Finance division decided to open “the
door to other divisions to describe the way we can add-value to [MEGOC’s] operations, and
contribute to the execution of the company’s overall strategic imperatives” (as stated by a Finance
manager). Several managers in the Finance division realized that they needed a boost to “regain
relevance within the company” and when the Finance division discovered the malleability of the BSC,
it discovered that it could play a role in the BSC implementation. The BSC offered them this
opportunity.
At a workshop we attended, a senior management accountant opened the meeting as follows:
It is a pleasure to be here with you this morning to give you an overview of the Finance
organization […] we all get so busy in our own operations that we do not get much chance […]
to learn what each of us has to offer towards the accomplishment of the company’s corporate
objectives. […] My colleagues and I will help you opening up the Finance black box, as some
of you have referred to us lately.
During his speech, the senior management accountant surprisingly built on the BSC language, metrics
and underlying logic to describe the reasons why Finance should be perceived as “a crucial partner in
the business”:
The vision of the Finance organization is to be recognized as a responsive and effective
business partner providing innovative financial expertise with a highly skilled, strongly
motivated and empowered staff […] I want to emphasize the word partner to you here because
this is how we want you to see our organizations […]. This makes today’s presentation
extremely important to us. If we succeed in encouraging you to call upon us for consultation,
then we can truly become your business partner in achieving the corporate strategic imperatives,
as well as the key objectives included in your scorecards, plans and budget” (Senior
management accountant).
Interviews and observations within the Finance division provided evidence that interest in the
BSC was increasing. While at the beginning of the BSC implementation process, the BSC was
considered an “operational tool” outside the scope of the Finance division, and for this reason it was
largely ignored, this was no longer the case later in the process. For example, as happened in many
divisions, the BSC was integrated (through their Enterprise resource Planning system) with the
budgeting process. A Finance manager stated: “We are currently in the process of developing our own
scorecard… we already started its implementation in some pilot departments within Finance”. He then
added: “It is time for us to foster processes of interactions with the other divisions, which are all
placing financial objectives at the top of their scorecards and strategy maps”. One of the
consequences of the BSC implementation in several operating and service division of MEGOC was an
organization-wide growing interest in the understanding of financial measures. Finance experts built
on this increasing focus on Finance to gain new relevance (and control) by fostering the introduction
of a new full costing system to be integrated with BSC. Significantly, the intertwined relationships
between the BSC and expertise offered by the Finance division were evoked as the senior management
accountant addressed the workshop’s audience as follows:
In each one of your scorecards you reach a point where operational metrics get translated
in financial terms. Well, we can be your partner with you there […] we can build with you an all
new level of cost awareness and budget preparation […]. We have a brand new ‘Full Cost
Reporting Project’ that will improve corporate and divisional performance through higher cost
17
awareness. Current cost sheets include NDEs (net direct expenses) and support service costs.
However these do not fully reflect the true costs required for each organization to function […].
This new system will help fuel your scorecards with accurate numbers, and help a better
translation of operational achievement into bottom-line results.
Within MEGOC, a number of skeptic accountants have now become BSC enthusiasts: the
participation in the enactment and in the ongoing fabrication of the technique went hand in hand with
the process of constructing the identity of those who were subject and objects of these new forms of
accounting and accountability. Importantly, from the interviews in the Finance division it was clear
that a major role was played by the new vice president of Finance, appointed in early 2005. A
management accountant noted: “He urged the Division to regain relevance within the organization
[…] with his arrival we were asked to pursue every single opportunity to act proactively as relevant
partner for the different business-lines… and he definitely made clear that the Balanced Scorecard
was one of those opportunities not to be missed”. Under the leadership of the new vice president, the
Finance division developed its own BSC by the end of 2006.
Discussion and conclusions.
Drawing on case material related to the adoption of the BSC in a Middle-East Oil and Gas
company and combining it with insights from Actor-Network Theory and studies on rhetoric, the
paper has argued that the adoption of the BSC is facilitated by its nature of method for ordering
complex thinking and making this manageable; its ability to translate this complexity into clear visual
representations; its nature of medium of communication which, in communicating a set of
performance measures, also allows a continuous mediation amongst the various parties involved in the
design of performance measurement systems, and; finally, the ability that these three aspects have in
making the BSC a practice able to transform itself, a performable playground where various
organizational rationalities can meet and negotiate. These four features make the BSC a rhetorical
machine, i.e. an instrument which facilitates a continuous work of ordering and organizing and makes
the BSC always different in different networks of relationships. This explains why, in practice, it is
difficult to find the BSC implemented in similar ways in different organizations (or even in different
divisions of the same corporation) and how, despite these differences, it though maintains a certain
degree of sameness which allows managers to refer to it as if it were a quite stable and homogeneous
technique.
The notion of rhetoric machine has also helped us to add a further dimension to those which
have been highlighted by extant studies on diffusion. Beyond the dichotomy between rationalist
responses and institutional pressures in driving the process of diffusion, and in line with more recent
contributions viewing the rationale for management ideas linked to multifaceted rationales and
networks of agencies, we have argued that it is the ability of the management practice to attract and
manage diversity that makes it succeed, i.e. to happen (in line with the Latin etymology of the word –
from succedor, i.e. to happen).
Viewing the BSC as a rhetoric machine has certainly corroborated the findings of those authors
who have drawn on the powerful idea of boundary object to explain the diffusion and success of
management practices. Thus, for instance, the BSC’s rhetorical mechanisms are able to prompt a
process of negotiation in order to find common interests amongst different political and organizational
interests (see Carlile 2004, p. 559). Analogously, as argued by Bechky (2003, pp. 326ff) they may help
in constituting a ‘common ground’ that leads to shared understandings, making meanings clearer and
thus constituting constraining factors that bind organizational actors. In other words, in line with some
new institutionalist understandings, they result in greater homogeneities of actor’s behavior and
therefore of organizations and organizational fields. However, viewing management practices as
rhetoric machines has also helped us to illustrate, thanks to the evidence provided by the MEGOC’s
case, that diffusion can happen also because of the ability of the practice to attract and manage
differences and not reconciled interests. In other words, the diversity attracted by the diffusing practice
is not tamed by the practice itself, which augments, rather than reducing, differences. Such difference
18
is thus managed and kept alive, in order to reduce resistance and permitting the institutionalization
process to happen in forms which are rather different from those which presuppose homogeneization
processes. The power of diffusing practices stays therefore in its ability to act as a facilitator of
innovation and discovery of new meanings rather than a constrainer of those. In the concrete case of
the BSC, it is the graphical space offered by the technique which justifies and presents organizing
features, which would otherwise not be needed if diversity and differences were to be suppressed by
the BSC’s implementation.
These findings have two further theoretical implications. In a first instance, they help us to
move away from the reductionist idea that diffusing practices have a stable and univocal set of
meanings, rationales and functions. In fact, the case has illustrated as, if diffusion were facilitated only
by the clarity of these meanings, functions and rationales served by the diffusing practice,
organizational actors would find it easy to stand for or against the diffusing process. Clarity would
have prompted resistance and, very likely, the failure of the diffusion and adoption process. Rather, we
have illustrated how, if meanings, rationales and functions underpinning the diffusion process are
made or left obscure (others would say “absent”, Latour, 1987) thanks to the rhetorical nature of the
diffusing practice, then a space for translation and appropriation is created and becomes the precondition to the diffusion of the technique to be adopted. The BSC as rhetorical wheel displays at its
centre a concept which is relationally defined and depends on what cards and what measures are
placed around this centre to contribute making abstract visions and strategies concrete.
In a second instance, they highlight a new dimension which has been overlooked in explaining
diffusion processes, that is, their intrinsic organizing nature and properties, for they diffuse and
succeed because they help managing difference rather than suppressing and homogenize it. In other
words, organizations are made of differences, conflicts and politics. Management practices that diffuse
contribute to their management rather than suppression and allow management and organizing to exist.
This should not surprise, as paradoxically, drawing on homogeneity, the constraining power of the
diffusion practice, and the existence of shared meanings and rationales to explain diffusion processes
would deny the need for organizing and organizations. It is only by explicitly admitting the continuous
existence and creation of diversity and difference and including these into theoretical framework
explaining the diffusion of management ideas that a need for organizing, organizations and
organization science can emerge and be imagined.
19
Table 1 – Schedule of interviews (2003-2005 and 2008)
Interviewee
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
Manager
Senior Manager
Senior Engineer
BSC team leader
BSC team member A
BSC team member B
Senior Manager
Cost Engineer
Senior Accountant
Senior Mgt. Accountant
Manager
Management Accountant
Training Manager
Cost controller
Manager A
Manager B
Manager A
Manager B
BSC team member
Senior Manager
Manager A
Manager B
Internal consultant A
Internal consultant B
Engineer
BSC Coordinator
BSC team member
MEGOC Divisions / Departments
(in alphabetic order)
Corporate planning
Corporate planning
Engineering & Operations Services
Engineering & Operations Services
Engineering & Operations Services
Engineering & Operations Services
Engineering & Operations Services
Engineering & Operations Services
Finance
Finance
Finance
Finance
Finance
Finance
Human Resources
Human Resources
Industrial Relations
Industrial Relations
Industrial Relations
Information Technology
Information Technology
Information Technology
Internal Consulting Department
Internal Consulting Department
Producing Engineering Dept.
Producing Engineering Dept.
Producing Engineering Dept.
Number
of
Interviews
3
2
2
3
2
2
2
1
2
2
2
1
2
1
2
2
2
1
2
3
2
1
2
1
1
2
1
Duration
of Interviews
(approx.)
2h; 1h; 1h40m
2h; 1h
1h40m;2h
2h; 1h; 1h40m
2h; 1h
2h; 1h30m
2h15m; 1h20m
1h30m
2h; 1h30m
2h; 1h40m
2h; 1h20m
1h
1h; 2h
1h30m
2h; 1h30m
2h; 1h10m
2h; 1h
1h30m
2h; 1h30m
2h; 1h; 1h40m
2h; 1h30m
1h45m
1h20m; 1h30m
1h40m
1h30m
2h; 1h30m
1h30m
20
Figure 1. The Balanced Scorecard as rhetorical wheel
The Balanced
Scorecard
as rhetorical
machine
Medium of
translation
Visual inscription
Method of ordering
and innovation
Performable space
Figure 2. The Balanced Scorecard at MEGOC
Figure 3. The Balanced Scorecard as rhetorical tree
Figure 4. Strategy map at MEGOC
21
Figure 5 E&OS objectives and KPIs
Figure 6. Sustaining and maintaining integration through the Scorecard
Figure 7. The Business Cafés
22
Figure 8. Café 04’s purpose
Figure 9. The Balanced Scorecard as a performing space
23
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i
This section draws and expands the work of [Author 2], 2009.
Interestingly a ‘record’, the key unit of information storing technologies, is also related to
memory, as its etymology reveals, from the Latin recordor, i.e. to remember.
ii
The word ‘calculation’, for example, originates from the Latin calculus, a synonym of ‘account’.
Making good calculations in Early Modern times meant also arranging and making meaningful relations
between accounts, spaces, and visual representations (‘numbers’ are ‘figures’ an 1586 Benedictine
accountant stated in his treatise, Pietra, 1586). Calculations, which are at the core of the logic
underpinning contemporary performance measurement systems such as the BSC, also reveal through the
etymology of the word clear visual and spatial dimensions and origins.
iii
iv
MEGOC (Middle East Gas and Oil Company) is the disguised name of the company.
28