Prioritizing higher education balanced scorecard performance indicators using fuzzy approach in an iranian context

AuthorDr. Daryush Farid/Dr. Heydar Mirfakhredini/Mehran Nejati
PositionAssistant Professor, Department of Economics, Management and Accounting, Yazd University, Iran/Department of Economics, Management and Accounting, Yazd University, Iran/Master Student of Executive MBA, Department of Economics, Management and Accounting, Yazd University, Iran
Pages338-349

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Introduction

Nowadays, the role of human capital in economical growth and development can not be ignored. Higher education, as the most important source of educating skilled people, is an important way of forming rich human capital through providing high quality education (Karname Hagi and Akbari, 2004). According to Iran's 20-year development plan (1404 Plan), by the year 2025, Iran is a developed country which holds number one rank in the region in the areas of economics, technology and education. Therefore, for Iran, in order to reach the planed educational position in the region, it is measure its universities' performance using performance measurement systems and make improvements. One of these performance measurement systems is balanced scorecard which has been introduced by Kaplan and Norton and widely applied by various organizations during the previous years (Kaplan and Norton, 1992, 1993, 1996a, 2000). The reason for use of the balanced scorecard is to formulate

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strategy objectively in the four perspectives, considering their multidimensional effect (Epstein and Roy, 2004). Balanced scorecard (BSC) measures performance measurement within four perspectives based on several defined performance indicators. Although these indicators are inter-connected to reach to organizational vision and mission, still BSC fails to provide any relationship between the importance of each of these indicators. Therefore, this paper tries to fill this gap by studying and prioritizing the performance indicators defined in the balanced scorecard of an Iranian university.

First, this paper overviews the issues of quality in higher education. Later it reviews Balanced Scorecard and its applications in higher education. And eventually in the methodology section, it seeks to prioritize the performance indicators related to Yazd University Balanced Scorecard model.

Quality in higher education

Quality in higher education is a complex and multifaceted concept and a single appropriate definition of quality is lacking (Harvey and Green, 1993). As a consequence, consensus concerning "the best way to define and measure service quality" (Clewes, 2003, p. 71) does not as yet exist. The concerns regarding the concept of quality in higher education are clearly expressed by Barnett (1994, p. 68): "What counts as quality is contested. The different views of quality generate different methods of assessing quality and in particular alternative sets of performance indicators (PIs). However, PIs are highly limited in their informational content, and have nothing to tell us about the quality of the educational process."

The key issue is the ability of the quality concept to facilitate the perspectives of a range of stakeholders who have differing conceptions of higher education. The concern is that there will be a direct relationship between the conception of higher education being taken, the definition of quality being used and the performance indicators chosen to measure quality. The challenge is to overcome these concerns and produce a performance evaluation framework that permits the equal expression of legitimate voices, though they may conflict or compete in some ways (Tam, 2001).

The balanced scorecard

Kaplan and Norton (1996b) developed the BSC in the early 1990s. According to them, "the BSC translates an organization's mission and strategy into a comprehensive set of performance measures and provides the framework for strategic measurement and management". Traditionally, most organizations look into their corporate performance by reviewing their financial aspects. However, financial measures alone are not a balanced view of the critical success factors of any organizations, mainly because financial measurements tend to measure the past. Therefore, what if an organization knows what has happened, if there are no explanations of "Why it has happened".

The BSC are based on four key perspectives; they are the:

(i) Financial goals - How will we look to our stake holders?

(ii) Customer perspective - How must we look to our customers?

(iii) Internal processes - What internal processes must we excel at?

(iv) Learning and growth - How can the organization learn and improve? (Sanger, 1988)

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Balanced scorecard applications in higher education

The progression from monitoring to the management of quality in education requires the adoption of a system which is aimed not only at performance measurement, but also at streamlining and focusing strategy towards the objectives of the various stakeholders (Kaplan and Norton, 1996b, 2000). In order to be successful, the scorecard also needs to be rooted in the employees' internal commitment (Nørreklit, 2000) and this requires the involvement of staff (Simons, 1995) in the development of performance management decisions.

It is evident that the BSC has been widely adopted in the business sector but the education sector has not embraced the BSC concept widely as indicated by the dearth of published research on this topic (Karathanos and Karathanos, 2005). Cullen et al., (2003) proposed that BSC be used in educational institutions for reinforcement of the importance of...

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