ESSEC Working Papers,
ESSEC Research Center, ESSEC Business School

Abstract: Theories about management instruments often enter dualistic debates between structure and agency: do instruments determine the forms of collective activity (CA), or do actors shape instruments to their requirements, or are instruments and concrete activity decoupled, as some trends of new institutionalist theory assume? Attempts to overcome the dualistic opposition between structure and activity stem from diverse sources: actors’ networks theory, structuration theory, pragmatism, theory of activity, semiotics. Performance measurement and management systems can be defined as structural instruments engaged in CA. As such they constrain the activity, but they do not determine it. Reciprocally, they are modified by the way CA uses them and makes sense of them. The central thesis of this paper will be that it is impossible to study the role of performance measurement as a common language in organizations independently from the design of the CA in which it is engaged. There is a not deterministic coupling between structure (i.e. management technical tools) and CA (i.e. business processes). The transformation of CA entails a transformation in the meaning of the “performance” concept, in the type of measurement required and in the performance management practices. The relationship between performance measurement and CA is studied here in the production division of a large electricity utility in France. The research extended over several years and took place when two new management systems were simultaneously implemented: a new management accounting system and an integrated management information system (ERP), both in the purchasing process. The new management accounting system was designed by the purchasing department; the new management information system was designed by the operational departments. Whereas the coherence between both projects could have been given by their common subordination to the rebuilding of CA (the purchasing process), their disconnection from concrete CA opened the possibility of serious dissonances between them.

Both the new performance management system and the new ERP met difficulties to provide common languages, since the dimension of CA was taken for granted and consequently partly ignored in the engineering of both systems. When CA incurs radical transformations, actors’direct discursive exchanges about it, “collective activity about collective activity”, become necessary to ensure a flexible and not deterministic coupling between CA and new management systems. This reflexive and collective analysis of the process by actors themselves requires the establishment of “communities of process”, which can jointly redesign the CA and its performance measurement system. We conclude that performance measurement can be a common language as far as there is a clear and shared understanding of how CA should concretely take place and should be assigned to the different categories of actors.

Keywords: Business Process; Collective Activity; Community of Process; Management Instruments; Performance Measurement; Semiotics; Theory of Activity

JEL-codes: Z00

28 pages, May 2007

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