An empirical analysis of the relationships between the interactive use of performance measurement systems , creativity and performance : the intervening role of psychological empowerment

There is considerable interest in the role of management control systems (MCS) in enhancing innovation and performance in organisations. An aspect of MCS that has attracted recent attention is the role of performance measurement systems (PMS) in organisational innovation. However, as yet, there has been little consideration given to identifying the nature of the relationship between PMS and creativity at an individual level. This study examines the effect of the interactive use of PMS on creativity and performance. Middle-level managers of large Australian manufacturing organisations were surveyed. The study identifies a key intervening variable, psychological empowerment, as being instrumental in the interactive use of PMS leading to the enhancement of creativity and performance in individuals. Psychological empowerment was also found to mediate the associations between the interactive use of PMS, creativity and performance.