A Qualitative Case Study on the Use of Balance Scorecard to Control Performance of a Local Government-Owned Water Supply Company in Indonesia

Abstract

This paper discusses how the Balance Scorecard is applied in a water supply companyin Indonesia. The company investigated in this study was a local government-ownedwater supply company is responsible for generating profit, as well as having a socialfunction. Performance becomes an important issue in this type of company, not justfrom the financial aspect, but also regarding non-financial performance. This researchwas a longitudinal case study. By applying ethnography, the researcher participatedin the process of controlling performance while performing the research, where thecase company modified the four perspectives of Balance Scorecard into four aspectsof performance, i.e., financial, service, operational, and human resource performanceaspects. This modified balance scorecard was used to control people in achieving theirtargeted performance. A management control system model was then used as a tool andmechanism to control performance.