Digitalisation and the performance measurement and management system: reinforcing empowerment

Abstract

Purpose This study explores how information and communication technologies (ICT) can contribute to empowerment in an Industry 4.0 setting. Design/methodology/approach The results are based on a case study of a Norwegian manufacturing organisation that has highly automated production and an integrated ICT platform. Data analysis was guided by the Smith and Bititci (2017) framework for performance measurement and management. Findings When powered by advanced ICT, the performance measurement system matures. The design and development of the ICT platform also reinforce the organisation's existing performance management practices. Empowerment is strengthened when automated collection, analysis and reporting of performance data free up middle managers' time so that they, together with operators, can drive continuous improvement. Research limitations/implications The findings are limited to a single case study and require further testing for transferability to other organisations. Future research should explore whether performance management practices are also reinforced by ICT in more command- and control-oriented organisations. Practical implications The paper suggests an alternative strategy of Industry 4.0 transformation for organisations committed to empowerment. Such organisations should rely on in-house, iterative ICT development and build digital competence broadly. Originality/value This article contributes to the understanding of how performance measurement and management are interrelated and evolve in the context of Industry 4.0. To the best of the authors’ knowledge, highlighting the role of middle managers in empowering operators through continuous improvement is novel in the performance measurement and management literature.

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