Research Journal of Finance and Accounting www.iiste.org ISSN 2222-1697 (Paper) ISSN 2222-2847 (Online) Vol.5, No.13, 2014 123 Understanding the Use of Balanced Scorecard in the Context of State-Owned Enterprises in Developing Countries: A Case from Ghana Samuel Nana Yaw Simpson and Francis Aboagye-Otchere Department of Accounting, University of Ghana Business School, P. O. Box LG 78, Legon, Accra Abstract This paper examines the conception, adoption and implementation of BSC from the context of a developing country and relatively less researched tier of the public sector – State-owned enterprises. The study adopts a case study approach where data was collected via semi-structured interview. Results show a BSC that emphasizes performance measurement and management and to some degree strategic management. Evidence on the extent of normalisation is mixed. Less than 50% of the interviewees on the average assert that there is collective action when it comes to the BSC. Furthermore, on the average a higher percent of the interviews took a neutral position (N) under each of the four elements that provide evidence in establishing the normalisation of the BSC. The limitation of this study are primarily those associated with case studies. This limitation instigates future studies drawing on other research strategies. At public sector level and SOEs in particular, this the findings of this study provide a first view of BSC being used in a Ghanaian state-owned enterprise Keywords: state-owned enterprises, balanced scorecard, Normalisation process theory, Ghana Introduction Performance measurement and management (PMM) have attracted the attention of virtually every organisation since the 1990s, but became prominent in the 1970s (Armstrong and Baron, 2005; Williams, 2003). In the specific case of public sector organisations, interests in PMM seem to have resurged following the impulse of reform experimentation across the globe in the late 1970s to early 1980s under labels such as new public management (NPM), public sector management (PSM), and public sector reform (PSR) (e.g. Cavalluzzo and Ittner, 2004; Fryer, et al., 2008; Hoque and Adams, 2008; Lapsley, 2008; Modell, 2009). Moreover, literature on PMM in the public sector show that PMM remains a problematic issue (see also De Vries, 2010; Modell, 2009; Propper and Wilson, 2003). This explains the burgeoning PMM innovations in the public sector through sponsored reform programmes by donor agencies and isomorphic pressures from the private sector (Brignall & Modell, 2000; De Vries, 2010; Fryer, et al., 2008; Modell, 2009). Balanced scorecard (BSC) is one of such PMM innovations in the public sector. Traditionally developed for private sector settings (Kaplan and Norton, 1992), BSC has over the years gone through several evolutions to include other perspectives such as corporate planning and strategy, external reporting (Kaplan and Norton, 1996, 2001a) and extension to the public and not-for-profit sectors (Kaplan, 2001; Kaplan and Norton, 2001b). Beyond this, there have been studies examining the application of BSC generally in the public sector and specific public sector organisations: healthcare organisations (Aidemark and Funck, 2009; Northcott and France, 2005; Dyball, Cummings and Yu, 2011), local government organisations (Chan, 2004; Kasperskaya, 2008; Greatbanks and Tapp, 2007; Northcott and Taulapapa, 2012), and central government and government departments (Griffiths, 2003; Hoque and Adams, 2011; Niven, 2005). Apart from the above studies being predominantly based on the context of developed countries, the findings are mixed. Furthermore, many of the studies fall short of providing practical insights and experiences on the implementation processes (Mcnamara and Mong, 2005; Northcott and Taulapapa, 2012; Sandhu, Baxter and Emsley, 2008) and the extent to which the BSC system becomes embedded and integrated as a routine practice normalises. Additionally, studies on the application of BSC by state-owned enterprises (SOEs) appear non- existent. Scholars argue that studies on various types of organisations particularly those in the public sector in different settings are critical to rearrange BSC to meet their different needs (Kaplan and Norton, 2001b; Kaplan, 2012; Niven, 2005), particularly those in the public sector environment. Theoretically, studies explaining adoption and implementation of any PMM framework and the BSC in particular in public sector organisations have been underpinned by both economic and institutional theories, but many of the studies have been inclined to principles of institutional theory and neo-institutional theory (see Fryer, et al., 2008; Hoque and Adams, 2011; Jacobs, 2012; Modell, 2009). Proponents argue that public sector organisations adopt and implement PMM frameworks due to regulatory and other isomorphic pressures to achieve both internal and external legitimacy. However, these postulations are limited in explaining how the adoption and implementation of public sector innovations become embedded and integrated into the day to-day activities. To that end, the current study draws on the Normalisation Process Theory (NPT) to explain how BSC was adopted, implemented, and has become embedded and integrated as a routine practice by a SOE in a