An integrated BSC-AHP approach for

supply chain management evaluation

Milind Kumar Sharma and Rajat Bhagwat

Milind Kumar Sharma is

Assistant Professor and
Rajat Bhagwat is Associate
Professor, both at the
Faculty of Engineering and
Architecture, Department of
Production and Industrial
Engineering, MBM
Engineering College, JNV
University, Jodhpur, India.

Summary
Purpose The purpose of this paper is to develop an integrated balanced scorecard (BSC) analytical
hierarchy process (AHP) approach for supply chain management (SCM) evaluation. It aims to measure
SCM performance from the following four perspectives: finance, customer, internal business process,
and learning and growth.
Design/methodology/approach The BSC is developed in the paper based on an extensive review of
literature on SCM performance measures, supported by AHP analysis.
Findings The paper develops a BSC for SCM evaluation and proposes a method to prioritize the
different performance levels in any organization using AHP methodology. It also suggests from the view
of different decision levels and overall performance measurement that is the best BSC perspective.
Practical implications The integrated BSC-AHP methodology developed in this paper provides
useful guidance for practical managers in evaluation and measuring of SCM in a balanced way.
Originality/value This paper proposes a balanced performance evaluation system for SCM. While
suggesting BSC, different SCM performance metrics have been distributed into four perspectives.
Different performance levels are highlighted and preferred BSC perspectives are suggested.
Keywords Balanced scorecard, Supply chain management, Analytical hierarchy process,
Performance measures
Paper type Research paper

1. Introduction
In recent years, a number of firms have realized the potential of supply chain management
(SCM) in day-to-day operations management. However, they often lack the insight for the
development of effective performance measures and metrics needed to achieve a fully
integrated SCM due to lack of a balanced approach and lack of clear distinction between
metrics at strategic, tactical, and operational levels (Gunasekaran et al., 2001; Hudson et al.,
2001). Therefore, it is clear that for effective SCM, measurement goals must consider the
overall scenario and the metrics to be used. These should represent a balanced approach
and should be classified at strategic, tactical, and operational levels, and include financial
and non-financial measures. Taking into account the above factors, a balanced SCM
scorecard has been developed in this paper to discuss the various measures and metrics of
SCM. Analytical hierarchy process (AHP) methodology is then integrated with balanced
scorecard (BSC) for SCM evaluation. This helps supply chains to prioritize different
performance levels and identify preferred BSC perspectives.
1.1. The BSC
The need for performance measurement systems at different levels of decision making,
either in the industry or service contexts, is undoubtedly not something new (Bititici et al.,
2005). Kaplan and Norton (1992, 1996) have proposed the BSC, as a means to evaluate
corporate performance from four different perspectives: the financial, the internal business

DOI 10.1108/13683040710820755

VOL. 11 NO. 3 2007, pp. 57-68, Q Emerald Group Publishing Limited, ISSN 1368-3047

MEASURING BUSINESS EXCELLENCE

PAGE 57

process, the customer, and the learning and growth. Their BSC is designed to complement
financial measures of past performance with their measures of the drivers of future
performance. The name of their concept reflects an intent to keep score of a set of items
that maintain a balance between short-term and long-term objectives, between financial
and non financial measures, between lagging and leading indicators, and between internal
and external performance perspectives. The early image of the BSC serving the CEO like a
control panel serves an aircraft pilot seems to have expanded to include mechanisms to alter
the course of action as well. Now, the BSC seems to serve as a control panel, pedals and
steering wheel (Malmi, 2001). Table I outlines the four perspectives included in a BSC.
Many companies are adopting the BSC as the foundation for their strategic management
system. Some managers have used it as they align their businesses to new strategies,
moving away from cost reduction and towards growth opportunities based on more
customized, value-adding products and services (Martinsons et al., 1999).
The BSC framework for supply chain management presented here in this article is
structurally similar to the BSC framework proposed by Kaplan and Norton.
The outline of the paper is as follows: Section 2 discusses performance evaluation
framework for SCM. Section 3 throws light on BSC evaluation of SCM. Section 4 and section
5 deal with AHP and AHP in SCM evaluation respectively. Section 6 presents result and
discussion. Finally, the conclusions and implications are presented in section 7.

2. Performance evaluation framework for SCM

Gunasekaran et al. (2001, 2004) claim that there is a greater need to study the measures and
metrics in the context of SCM for two reasons:
1. lack of a balanced approach; and
2. lack of clear distinction between metrics at strategic, tactical, and operational levels.
A set of performance measures and metrics in supply chain is discussed in the literature:
B

Metrics of planned order procedures. These are used to measure the performance of the
order-related activities. Some metrics are order entry method, order lead-time, and order
path.

Supply chain partnership and related metrics. These are used to assess the level of
coordination among supply chain partners. Some evaluation criteria are the level and
degree of information sharing, buyer-vendor cost initiatives, extent of mutual cooperation
leading to improved quality, and the extent of mutual assistance in problem-solving
efforts.

Production level measures and metrics. This category consists of range of product and
services, capacity utilization, and effectiveness of scheduling techniques.

Delivery link measures. These are designed to evaluate the performance of delivery and
distribution cost.

Table I The four perspectives in a balanced scorecard

Customer perspective (value-adding view)
Financial perspective (shareholders view)
Internal perspective (process-based view)
Learning and growth perspective (future view)

Source: Kaplan and Norton (1992)

PAGE 58 MEASURING BUSINESS EXCELLENCE VOL. 11 NO. 3 2007

Mission: to achieve our vision by delivering value

to our customer
Mission: to succeed financially, by delivering
value to our shareholders
Mission: to promote efficiency and effectiveness
in our business processes
Mission: to achieve our vision, by sustaining
innovation and change capabilities, through
continuous improvement and preparation for
future challenges

Customer service and satisfaction measures. The measurement is aimed to integrate the
customer specification in design, set the dimensions of quality and as the feedback for
the control process. They contain product/service flexibility, customer query time, and
post-transaction service.

Finance and logistics cost metrics: They are used to assess the financial performance of
supply chain, such as assets cost, return on investment, and total inventory cost.

Gunasekaran et al. (2001, 2004) identified and discussed the different performance
measures and metrics of the SCM with help of a framework that gives cohesive picture to
address what needs to be measured, and how it can be dealt with. The framework
developed is shown in Table II.

Table II A framework of metrics for the performance evaluation SCM

Level

Performance metrics

Strategic

Total supply chain cycle time

Total cash flow time
Customer query time
Level of customer perceived value of product
Net profit vs. productivity ratio
Rate of return on investment
Range of products and services
Variations against budget
Order lead time
Flexibility of service systems to meet particular
customer needs
Buyer-supplier partnership level
Supplier lead time against industry norms
Level of suppliers defect free deliveries
Delivery lead time
Delivery performance
Accuracy of forecasting techniques
Product development cycle time
Order entry methods
Effectiveness of delivery invoice methods
Purchase order cycle time
Planned process cycle time
Effectiveness of master production schedule
Supplier assistance in solving technical
problems
Supplier ability to respond to quality problems
Supplier cost saving initiatives
Suppliers booking in procedures
Delivery reliability
Responsiveness to urgent deliveries
Effectiveness of distribution planning schedule
Cost per operation hour
Information carrying cost
Capacity utilization
Total inventory cost as:
Incoming stock level
Work-in-progress
Scrap value
Finished goods in transit
Supplier rejection rate
Quality of delivery documentation
Efficiency of purchase order cycle time
Frequency of delivery
Driver reliability for performance
Quality of delivered goods
Achievement of defect free deliveries

Tactical

Operational

Financial

Non-financial
U
U
U
U

U
U
U
U
U

U
U
U
U
U
U
U
U
U
U
U
U
U
U
U

U
U
U
U
U
U
U

U
U
U

U
U
U
U
U
U
U

Source: Gunasekaran et al. (2001)

VOL. 11 NO. 3 2007 MEASURING BUSINESS EXCELLENCE PAGE 59

The metrics discussed in this framework are classified into strategic, tactical and operational
levels of management. The metrics are also distinguished as financial and non-financial so
that a suitable costing method based on activity analysis can be applied. A balanced
scorecard approach is discussed to evaluate these measures and metrics for SCM in the
section that follows.

3. BSC for SCM evaluation

The BSC for SCM framework presented here is developed by Bhagwat and Sharma (2007)
and structurally similar to the BSC framework at the corporate management level as
proposed by Kaplan and Norton. Gunasekaran et al. (2001) identified supply chain metrics
and proposed a framework for SCM performance evaluation. Bhagwat and Sharma (2007)
applied BSC to these metrics with the intent to evaluate SCM performance comprehensively.
Four perspectives of the BSC are applied to these discussed metrics or in other words the
different metrics are fitted into four different perspectives of BSC as shown below:
1. Performance metrics for the financial perspective:
B

customer query time;

net profit vs productivity ratio;

rate of return on investment;

variations against budget;

buyer-supplier partnership level;

delivery performance;

supplier cost saving initiatives;

delivery reliability;

cost per operation hour;

information carrying cost; and

supplier rejection rate.

2. Performance metrics for the customer perspective:

customer query time;

level of customer perceived value of product;

range of products and services;

order lead time;

flexibility of service systems to meet particular customer needs;

buyer-supplier partnership level;

delivery lead time;

delivery performance;

effectiveness of delivery invoice methods;

delivery reliability;

responsiveness to urgent deliveries;

effectiveness of distribution planning schedule;

information carrying cost;

quality of delivery documentation;

driver reliability for performance;

quality of delivered goods; and

achievement of defect free deliveries.

PAGE 60 MEASURING BUSINESS EXCELLENCE VOL. 11 NO. 3 2007

3. Performance metrics for the internal business perspective:

B

total supply chain cycle time;

total cash flow time;

flexibility of service systems to meet particular customer needs;

supplier lead time against industry norms;

level of suppliers defect free deliveries;

accuracy of forecasting techniques;

product development cycle time;

purchase order cycle time;

planned process cycle time;

effectiveness of master production schedule;

capacity utilization;

total inventory cost as: incoming stock level, work-in-progress, scrap value and
finished goods in transit;

supplier rejection rate;

efficiency of purchase order cycle time; and

frequency of delivery.

4. Performance metrics for the innovation and learning perspective:

B

supplier assistance in solving technical problems;

supplier ability to respond to quality problems;

supplier cost saving initiatives;

suppliers booking in procedures;

capacity utilization;

order entry methods;

accuracy of forecasting techniques;

product development cycle time;

flexibility of service systems to meet particular customer needs;

buyer-supplier partnership level;

range of products and services; and

level of customer perceived value of product.

Each of the four perspectives translated into corresponding metrics and measures that reflect
strategic goals and objectives. It is recommended that the perspectives should be reviewed
periodically and updated as necessary. The measures included in the given BSC should be
tracked and traced over time, and integrated explicitly into the strategic SCM process.

3.1. Measuring and evaluating financial metrics

Financial performance measures indicate whether the companys strategy, implementation
and execution are effectively contributing to the bottom line improvement of a firm. Financial
goals include achieving profitability, maintaining liquidity and solvency both short term as
well as long term, growth in sales turnover and maximizing wealth of shareholders. Financial
performance indicators are shown in the list above. In simplicity, financial goals are to
survive, succeed and prosper. Survival is measured by cash flow, success by growth in
sales and operating income and prosperity by increased market share and return on equity
and capital employed.

VOL. 11 NO. 3 2007 MEASURING BUSINESS EXCELLENCE PAGE 61

3.2. Measuring and evaluating customer perspective

How do customers see the business: The BSC demands that the management must
translate their general mission statement on customer service into specific measures that
reflect the factors that really matter to the customers. Customers generally, concern to
lead-time, quality of products and services, companys performance service and the cost
effectiveness. But on long term basis and more importantly in the era of globalization any
firms competitiveness lies on different customer-related factors are shown in the
performance metrics for the customer perspective section in the above list.
3.3. Measuring and evaluating internal business perspective
What must business excel at: the internal measures for the BSC stems from the business
process that have the greatest impact on customers satisfaction factors that affect cycle
time, quality, skill of the employees, and of course, productivity. Firms should decide what
processes and competencies they must excel at and specify measures for each of them.
Performance metrics for the internal business perspective are shown in the list above.
3.4. Measuring and evaluating innovation and learning perspective
Can we continue to improve and create value: A companys ability to innovate, improve and
learn leads directly to companys value. Innovation and continuous learning process can
bring about efficiency in the operating domain of the business. Moreover, it ensures cost
reduction and product differentiation to meet the varied requirements of the customers. As a
result, it strengthens the financial ability through earning higher profitability and greater
degree of appropriation of profit and retaining larger share of earnings to finance the
forthcoming expansion of future projects of the company under consideration. Performance
metrics for the innovation and learning perspective in a BSC includes measures as shown in
the list above.
Now the challenge before firms is to identify the most preferred BSC perspective so as to
identify the leading or lagging business area to measure business performance on
day-to-day basis. For this, in the next section AHP is integrated with the BSC for SCM
evaluation that not only prioritizes different performance levels in the organization, but also
suggests the best BSC perspective as alternative.

4. The AHP
The AHP is a multi-criteria decision-making tool developed by Saaty (1980). The AHP is a
systematic procedure for representing the elements of any problem, hierarchically. A
hierarchy is structured from the top (objectives from a managerial standpoint), through
intermediate levels (criteria/sub-criteria on which subsequent levels depend) to the lowest
level (which is usually a list of alternatives). It organizes the basic rationality by breaking
down a problem into its smaller and smaller constituent parts and then guides decision
makers through a series of pair-wise comparison judgments (which are documented and
can be re-examined) to express the relative strength or intensity of impact of the elements in
the hierarchy. These judgments are then translated into numbers. AHP uses pair-wise
comparison of the same hierarchy elements in each level (criteria or alternatives) using a
scale indicating the importance of one element over another with respect to a higher-level
element. The importance of scale between elements is shown in Table III.
The scaling process yields a relative priority or weight of elements with respect to criterion or
element of the highest level. The comparisons are performed for all the elements in a level
with respect to all the elements in the level above. The final and global weights of the
elements at the lowest level of the hierarchy are found by adding all the contributions of the
elements in a level with respect to all elements in a higher level.
The AHP includes procedures and principles used to synthesize the many judgments to
derive priorities among criteria and subsequently for alternative solutions. It is useful to note
that the numbers thus obtained are ratio scale estimates and correspond to so-called hard
numbers (Saaty, 1980). Once the pair-wise comparison of alternatives or sub-criteria is

PAGE 62 MEASURING BUSINESS EXCELLENCE VOL. 11 NO. 3 2007

Table III Scale of relative importance

Intensity of relative
importance

Definition

Explanation

1
3

Equal importance
Moderate importance of one over another

Essential or strong importance

Demonstrated importance

Extreme importance

2,4,6,8

Intermediate values between the two adjacent

judgments
If an activity has one of the above numbers compared
with a second activity, then the second activity has
the reciprocal value when compared to the first

Two activities contribute equally to the objective

Experience and judgment slightly favor one activity
over another
Experience and judgment strongly favor one activity
over another
An activity is strongly favored and its dominance is
demonstrated in practice
The evidence favoring one activity over another is of
the highest possible order of affirmation
When compromise is needed

Reciprocals of above
non-zero numbers
Source: Saaty (1980)

made with respect to an element in a higher criterion (formed as a matrix), the largest
eigenvalue (lmax) should be approximately equal to the number of elements in the
comparison matrix (n). The deviation of lmax from n is a measure of the consistency of
judgment of the decision maker. The consistency index (CI) is found using:
CI l max 2 n=n 2 1:
The consistency ratio (CR) is found by:
CR CI=RI:
RI is a random index of the same order matrix shown in Table IV.
Generally, the value of the consistency ratio should be around 10 percent or less to be
acceptable. In some cases 20 percent may be tolerated but never more (Saaty, 1980).
The AHP method has the following advantages (Abdul-Hamid, 1999).
B

A subjective decision process can be formalized owing to the hierarchy structure. This
leads to accurate decisions.

Insures consistency of the decision judgment.

Clearer understanding of the problem by dividing it into sub-problems.

The comparison may be made by teams or an iterative process until an agreement is

reached by the team members.

Sensitivity analysis may be performed by the results using computers before final
judgment is rendered.

The tedious calculations of the AHP process are no longer a problem using computers and
specialized software such as Expert Choicee software. AHP has been used in a wide range
of applications such as plant layout (Abdul-Hamid, 1999; Dweiri and Meirer, 1996), new
product screening (Calantone, 1999), part-machining grouping (Gungor and Arikan, 2000),
Table IV Random index (RI) for factors used in the decision-making process
n

10

11

12

RI

0.58

0.9

1.12

1.24

1.32

1.41

1.45

1.49

1.51

1.58

Source: Saaty (1980)

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vendor selection (Partovi et al., 1990), quality function deployment (Bergquist and
Abesysekera, 1996), software metrics evaluation (Sureshchandar and Leisten, 2006),
material selection (Dweiri and Al-oqla, 2006) and supplier selection (Percin, 2006). Use of
AHP in a problem-like IS architecture evaluation, however, is not prominent in the literature.

5. AHP in SCM evaluation

This work presents the integrated BSC-AHP approach for SCM evaluation. The AHP can be
the best tool for prioritizing and choosing the best BSC perspectives for SCM operations.
The hierarchic portrayal of a problem is as followsIn the present study, the overall performance measurement system (PMS) of SCM has been
defined by three performance criteria in the hierarchy, i.e. strategic, tactical and operational
level. At the lowest level the four BSC perspectives have been kept as alternatives. The result
of AHP will help in prioritizing the most critical perspective of the SCM evaluation.
For decomposition or structuring of the problem as a hierarchy, the first (or top) level is the
overall performance measurement system. In the second level are the three factors or
criteria, which contribute to the goal (overall PMS), in the third level (bottom level) are the four
BSC perspectives. Different BSC perspectives are the alternatives in the hierarchy to be
evaluated in terms of the criteria in the second level. The pictorial representation of the
hierarchy is as shown in Figure 1.
As discussed above, the important criteria to the overall PMS are three performance levels of
the organization as:
1. PMS at strategic level (Ps);
2. PMS at tactical level (Pt); and
3. PMS at operational level (Po).
These three performance levels have been considered so as to evaluate the SCM
performance from the overall perspective and provide SCM a comprehensive performance
measurement system.
In the AHP, elements of a problem are compared in pairs with respect to their relative impact
(weight or intensity) on a property they share in common. Pair-wise comparisons are
reduced to a matrix form. When sets of elements are compared with each other a square
Figure 1 Pictorial representation of the problem hierarchy

PAGE 64 MEASURING BUSINESS EXCELLENCE VOL. 11 NO. 3 2007

matrix is produced. The square matrix has an equal number of rows and columns together
with eigenvectors and eigenvalues. The reason for this computation is that it gives a way to
determine quantitatively the relative importance of factors. The factors with the highest
values are the ones that should be concentrated on for developing a plan of action to
achieve objective. AHP structures the problem hierarchically and a matrix is arranged to
compare the relative importance of criteria in the second level with respect to the overall
objective or focus of the first level. Similarly, matrices are also constructed for pair-wise
comparisons of each alternative in the bottom level with respect to the criteria of the second
level. These are shown in Tables V-VII and described in section 5.2. Case study
methodology was used in making the pair-wise comparisons and the following types of
questions have been noted to occur.
In comparing one element with another:
B

Which is more important or has a greater impact?

Which is more likely to happen?

Which is more preferred?

All the questions asked during the case study appeared to fall in one of these three
categories. In comparing criteria it is asked which criterion is more important? In comparing
alternatives with respect to criteria it is asked which alternative is desired?
5.1. Case study
Five supply chains from different industrial contexts and backgrounds were chosen for this
study in order to achieve a fairly generalizable set of results. These companies are selected
on the basis of their business operations as well as performance measurement related
practices. All the five companies are leading companies in their respective areas with
sizable market shares. From five cases, one company is a leading automotive company, one
is an electronic goods company, one is a food and beverage company and the other two
companies are leading fast moving consumable goods supply chains. The study comprised
open and semi-structured interviews with the senior executives. Apart from executives, key
Table V P overall performance (level 1)
Po
1 P strategic
2 P tactical
3 P operational

Weights

1.00
0.17
0.13

6.00
1.00
5.00

8.00
0.20
1.00

0.755
0.067
0.178

Notes: Max. eigenvalue 3:4134; consistency ratio 0:0913

Table VI Priorities with respect to P strategic, P tactical and P operational

BSC perspectives

P strategic

P tactical

P operational

0.227
0.326
0.234
0.213

0.212
0.205
0.224
0.359

0.345
0.149
0.350
0.156

Financial
Customer
Internal business
Innovation and learning

Table VII Priorities with respect to P overall performance

1
2
3
4

Financial perspective
Customer perspective
Internal business perspective
Innovation and learning perspective

0.247
0.286
0.254
0.213

VOL. 11 NO. 3 2007 MEASURING BUSINESS EXCELLENCE PAGE 65

functional managers as well as supervisory staff were also interviewed to obtain their
viewpoints. Interviewees were asked to compare pair-wise on a scale of 1 to 9 their
agreement with a number of criteria/alternatives. Interviews lasted from 1 to 2 hours. Criteria
and alternatives were ranked on the basis of the opinion of the majority of the interviewees.
Wherever available, the interview data was supplemented with archival data such as
department manuals, process manuals, financial reports and other performance
measurement related documents. Use of multiple-informants and use of archival data
helped us crosscheck pertinent information and verify the reliability of the data obtained.
5.2. An illustration of subjective judgments using the scale
While considering criteria and alternatives independent, the cells of the AHP matrix have
been filled in with the subjective judgments using the 1 to 9 scales and based on the
preference and perception of the criteria for the overall performance measurement. For
example in Table V, which represents the level 1 of hierarchy, when asked, With respect to
overall performance measurement, what is the importance of performance measures at
strategic level (P strategic) to performance measures at tactical level (P tactical)? If the P
strategic was strongly more important then the integer 6 was entered in the corresponding
cell; it is reciprocal, or 1/6 was automatically entered for the reverse comparison. In the same
way other cells of the matrix were also filled in. According to the majority of respondents
feedback in the case study, different ranks are entered in the table. In the bottom level, the
four BSC perspectives are to be pair-wise compared for each of the performance levels
(criteria). Priorities are synthesized from the second level down by multiplying local priorities
by the priority of their corresponding criterion in the level above and adding them for each
element in a level according to the criteria it affects. This gives the global or composite
priority of that element which is then used to weight the local priorities of elements in the level
below compared by it as criterion and so on to the bottom level.

6. Results and discussion

Clearly from Table V, P strategic is (0.755) perceived to be the most important criterion
followed by the P operational (0.178) and P tactical (0.067). It reveals that performance
measurements related to strategic level have been considered to be most important
whereas the measures at tactical levels have been rated least. It also suggests that
performance measures, which reflect the strategic performance for the long term, are
preferred. It is interesting to note that performance measures at operational level have been
preferred over the same of at tactical level. It shows that the day-to-day performance
measures have been considered to play more significant role than the same of the middle
level management. The tactical level, in general, plays a role of catalyst in background to
convert the objectives of strategic level into reality through operational level. Hence, from the
view of physical performance, the operational level performance measure may get an edge
over the tactical level. However, the performance measures related to tactical levels have
their own importance in achieving the objective.
For the criterion P strategic (Table VI) the customer perspective (0.326) is perceived as the
most important BSC perspective followed by the internal business perspective (0.234). It
shows that to survive in the present era of globalization, the companies should constantly
gauge the customers and market trends to design and deploy new strategies continuously
through internal operations. With respect to P tactical and P operational the innovation and
learning (0.359) and internal business (0.350) perspectives are perceived as the most
important BSC perspectives respectively. This result shows that at middle level
management, issues pertaining to the new ideas, product/process developments and
training etc. should be concentrated on. It will help to transform the vision of the strategic
level management by executing ideas at operational level. Operational level usually controls
the day-to-day execution in any organization. So at this level, by focusing on the internal
functional activities could be crucial for any SCM operations. To summarize, it can be seen
that internal operation is getting consistently comparable weights at strategic, tactical and
operational levels. The results are justified, as one of the major objectives of SCM is to
synchronize the internal operations with respect to operations/requirements of
suppliers/customers.

PAGE 66 MEASURING BUSINESS EXCELLENCE VOL. 11 NO. 3 2007

Finally in P overall (Table VII), the customer perspective (0.286) would be selected first
followed by the internal business perspective (0.254). It shows that for overall performance
measurement, the criteria related to customer perspective and internal business operations
should be focused most as compared to other BSC perspectives. In summary, above results
suggests prioritization of the different performance levels. It further ranks the different BSC
perspectives in SCM evaluation.

7. Conclusions and implications of the study

The integrated BSC-AHP approach, as a decision-making tool presented in the paper is
efficient in dealing with multi-criteria decision-making problems. AHP involves the process of
choosing among many alternatives based on multiple criteria and sub-criteria. The
decision-maker can perform sensitivity analysis on the selection choices and the sub-criteria
to account for variations (changes) of the pair-wise comparisons and have a high degree of
confidence in his/her judgment.
Performance evaluation of SCM is a problem facing decision-makers nowadays, especially
in the era of globalization. Results of this study give useful insights to managers to prioritize
different BSC perspectives. It gives rational to decide which decision level performance
plays the most important role in overall performance measurement. At the same time it also
ranks different BSC perspectives to prioritize them rationally in normal business operations.
The research work has contributed to important issues of SCM performance evaluation
theory and practice. The following points can be summarized:
B

This study contributes to performance evaluation of SCM. It points out the importance of
key players in the performance measurement of SCM, and the nature of roles they need to
play.

Results of case study throw light on method of prioritizing performance measurements at

different decision levels also. The approach can help firms to focus on the most critical
performance measurement levels while giving them the top priority.

A balanced performance evaluation such as, balanced scorecard not only helps
organizations in faster and wider progress monitoring of their operations but can also help
them in improving their internal and external functions of business.

BSC perspective can be important in firms specific contexts at different decision levels
and how to prioritize different perspectives from the point of view of the overall
performance measurement. It focuses on critical factors that are likely to contribute for the
successful performance measurement of SCM.

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About the authors

Milind Kumar Sharma has taught many subjects related to production and industrial
engineering and operations management. Prior to joining the JNV University, Jodhpur in 1998,
he served in industry for four years. He has been awarded research projects under the Career
Award for Young Teacher Scheme by the All India Council for Technical Education (AICTE)
and University Grants Commission (UGC), New Delhi, India. His areas of research interests
include management information system, performance measurement, supply chain
management and small business development. He has published research papers in
Production Planning and Control, Computers & Industrial Engineering, Journal of
Manufacturing Technology Management, International Journal of Globalization and Small
Business, International Journal of Enterprise Network Management, International Journal of
Productivity and Quality Management and Measuring Business Excellence. Milind Kumar
Sharma is the corresponding author and can be contacted at: milindksharma@rediffmail.com
Rajat Bhagwat is an Associate Professor in the Department of Mechanical Engineering, JNV
University, Jodhpur. He has also worked as a Research Assistant in the University of Hong
Kong, Hong Kong. His areas of research interests include information systems, simulation,
modeling and control of flexible manufacturing systems. He has working experience in
industrial projects in the areas of production, planning and control, capacity expansion, and
layout planning. He has been awarded a postdoctoral fellowship at the University of
Bordeaux, France. He has a number of publications in international journals and conferences.

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