Since performance measurement systems play a key role in developing strategic plans, evaluating the achievement of organizational objectives and compensating managers, one of the most critical challenges facing the corporate sector today is the choice of performance measures. Despite the increasing adoption of these performance measurement innovations, relatively few studies have examined the economic relevance of the new measures, the implementation issues arising from their adoption, or the performance consequences from their use. The author describes the emerging performance measurement practices; highlights the current research on the use and performance consequences of the new measures; discusses the research done on the disclosure of performance measures; and sets the background for further research in the area of business performance measures. The fact which makes research in the discipline of business performance measures unique is that a major, influential and widely published part of the research is sponsored by premier business schools across the world or by top management consultancy firms and organizations, in an organized manner although research in this discipline is varied and broad-based rather than in-depth or built upon others’ work. This paper is a part of major research on business performance and throws light on studies that highlight the evolution of business performance measurement; studies that compare the various performance measurement systems and models; studies on disclosure and reporting of business performance measures; studies highlighting the practices of performance measurement and so on.

The choice of performance measures is one of the most critical challenges facing the corporate sector. Performance measurement systems play a key role in developing strategic plans,evaluating the achievement of organizational objectives and compensating managers. Yet many managers feel that traditional accounting-based measurement systems no longer adequately fulfill these functions. The perceived inadequacies in traditional accounting-based performance measures have motivated a variety of performance measurement innovations ranging from “improved” financial metrics such as “economic value” measures to “balanced scorecards” of integrated financial and nonfinancial measures to measures of intellectual capital and measures for disclosure and reporting. Such innovations and trends have aroused special interest for researchers. However, despite increasing adoption of these performance measurement innovations, relatively few studies have examined the new measures’ economic relevance, the implementation issues arising from their adoption, or the performance consequences from their use. In India, we find scarcity of research in the area of Business Performance Measure.