Shalini.S and Dr. S. Venkatesh*
1. Shalini.S 
, Assistant Professor, Institute of Management, Kristu Jayanti University.
2. S. Venkatesh* Assistant Professor, Assistant Professor, Department of Management Studies, School of Law, Dhanalakshmi Srinivasan University, Tiruchirapalli
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Abstract
The Balanced Scorecard, often known as the BSC, is a valuable measuring and strategic management control tool that will help to achieve the desired results. The primary purpose of BSC is to teach employees about organizational plans and to support employees in putting those goals into action; nevertheless, the use of BSC for performance assessment is being influenced by a variety of issues. Balanced scorecard usage in the information technology industry is influenced by several criteria, including ease of use, usefulness, control system, and evaluation style. There is a significant gap between the elements that influence the usage of balance scorecard in the information technology industry and the employees’ profiles. The decision-making process is being considerably influenced in a favorable way by aspects such as usefulness, ease of use, control system, and evaluation style. As a result, the implementation of balanced scorecard should also be supported by developing them in such a way that they coordinate with many other control systems and assessment styles that are used in IT organizations.
Keywords: Balance Scorecard,, Decision Making, and IT Sector
Introduction
The Information Technology (IT) sector in India has established a very solid reputation and image for its superior level of standards in software development and designing abilities, service quality, and information security (Bahl, & Wali, 2013). These qualities have been acknowledged all over the world, and this recognition helps to build confidence among the sector’s stakeholders. The information technology industry is continuing its efforts to set world-class benchmarks in quality, performance, and information security (Ghodeswar, B., & Vaidyanathan, J.; 2008). This is being accomplished through a combination of provider and proactive initiatives of companies, as well as through the enhancement of overall frameworks, the generation of a higher level of awareness, the facilitation of large-scale application of standardized practices, and the improvement of employee performance. Because of this, measuring the performance of people working in the information technology industry is of the utmost importance for both making decisions and evaluating the success of IT organizations.
Techniques for performance assessment aid businesses in quantitatively measuring their performance, and these approaches enable organizations to better understand, manage, and enhance the fundamental business operations they engage in. The performance measurement system intends to integrate non-financial metrics as well, and it asks for a new performance measuring as a result of the insufficiency of heavily relying on conventional measurements of financial success. Balanced Scorecard (BSC) is a valuable assessment and strategic management control tool that was established by Kaplan and Norton. Its purpose is to obtain the results that are desired by the organization (Martinsons, M., Davison, R., & Tse, D. 1999).
The primary objective of BSC is to provide employees with information on organizational strategies and assistance in carrying out those plans. At the same time, elements related to workers as well as organizational characteristics are supporting the use of BSC for assessment of performance and personal attributes of managers, and these aspects influence the decision-making process of companies (Bentes, et al., 2012). As a result, the purpose of this research is to investigate the factors that influence the utilization of balanced scorecards in the information technology industry in the city of Bengaluru.
- To examine business strategy adopted by IT companies.
- To study balanced scorecard measures usage in IT companies.
- To study aspects persuading the implementation balanced scorecard in IT companies.
Literature Review
In recent years, the Balanced Scorecard (BSC) framework has evolved from a static performance measurement tool into a dynamic strategic management system. Research published between 2020 and 2024 emphasizes the BSC’s adaptability across various sectors, including education, healthcare, IT, and the public sector. The following synthesis outlines key developments, emerging trends, and research gaps from the latest studies.
The foundational work of BSC as a multi-dimensional performance measurement system. Recent studies by Lauras, et Al., (2010) highlight that organizations now view BSC as an integrative management framework aligning strategic objectives with measurable outcomes. BSC’s adaptability has led to sector-specific modifications such as the Healthcare Balanced Scorecard and Sustainability Balanced Scorecard (SBSC).
One of the most notable trends in recent literature is the integration of sustainability and digitalization within BSC frameworks. Sustainability Balanced Scorecards (SBSCs) extend the traditional four perspectives by adding environmental and social dimensions. Studies (Ortiz‐de‐Mandojana, N., & Bansal, P. 2016) demonstrate that incorporating sustainability metrics enhances long-term organizational resilience and stakeholder engagement. Furthermore, digital transformation has enabled organizations to integrate BSC with business intelligence and data analytics platforms, allowing real-time performance tracking and decision-making.
Research shows that BSC has been successfully implemented in diverse contexts, with particular success in healthcare and service industries. In healthcare, BSC adoption improved patient satisfaction, operational efficiency, and internal communication (Ritchie, et al., 2019). In the IT and SME sectors, however, empirical studies remain limited, though emerging evidence indicates BSC’s usefulness in aligning employee performance with strategic innovation goals (Spanò, R., et aol., 2016).
Despite its benefits, several challenges persist in BSC implementation. Studies report difficulties in linking non-financial metrics to strategic objectives, inadequate leadership commitment, and limited employee engagement (Nguyen, et al., 2020). Successful BSC adoption requires top management support, continuous feedback mechanisms, and regular review of strategic targets. Digital dashboards and data-driven monitoring tools have been identified as facilitators of BSC effectiveness. Recent studies emphasize the connection between BSC, Enterprise Risk Management (ERM), and corporate governance. Integrating risk indicators into BSC perspectives strengthens strategic alignment and improves accountability (Papalexandris, et al., 2005). This integration is particularly significant in volatile industries such as IT, where risk mitigation and performance monitoring must occur simultaneously.
Recent systematic reviews call for longitudinal studies examining BSC’s causal impact on organizational performance, especially in SMEs and IT firms. Comparative cross-country research, studies on digital BSC implementations, and exploration of the behavioral impact of BSC usage are also identified as future research needs.
Methodology
The city of Bengaluru serves as the investigation’s primary location. For the purposes of this study, employee participants from the IT industry are selected using the random sample approach. The structured questionnaire is used to collect data from three hundred employees working in the information technology sector. The percentages are calculated in order to have a better understanding of the profile of an IT industry employee. An exploratory factor analysis is being carried out in order to investigate the factors that influence the application of balance scorecard in the information technology industry. The t-test and the F-test are used to investigate the differences in the factors that influence the utilization of balance scorecards in the information technology industry and the employee profiles. In order to evaluate the impact of the factors that influence the adoption of balance scorecards in the information technology industry on decision making, a multiple regression analysis is utilized.
The study focuses on employees working in IT companies located in Bengaluru. The population includes both technical and non-technical staff exposed to performance measurement systems, including developers, testers, team leads, project managers, and HR personnel. The sampling frame will be drawn from employee rosters of selected IT firms (small, medium, and large) and verified using publicly available databases such as NASSCOM directories and LinkedIn company pages. The Sample Size Determination
Using Cochran’s formula for sample size estimation:
n0 = (z^2 * p * q) / e^2
where z = 1.96 (95% confidence level), p = 0.5, q = 0.5, and e = 0.05.
n0 = (1.96)^2 * 0.5 * 0.5 / (0.05)^2 = 384.16
Hence, the required sample size is approximately 385 respondents. Accounting for a 60% response rate, around 642 survey invitations should be sent to achieve the desired sample size. The original study’s sample size of 300 remains acceptable with a slightly larger margin of error (around 6%).
A stratified random sampling approach will be used. Employees will be categorized by company size (small, medium, large) and designation (entry-level, mid-level, managerial). Samples will be drawn proportionally from each stratum to ensure representativeness. Alternatively, if access to company lists is limited, a two-stage cluster sampling design can be applied: first selecting companies, then randomly selecting employees within them.
Inclusion and Exclusion Criteria
Include: Full-time employees with at least six months of tenure, aged 21 years and above.
Exclude: Interns, consultants, and contract staff not covered by formal performance systems.
Analysis
4.1 Respondent Profile Summary
Table 1 presents the demographic and professional profile of employees working in the IT sector, highlighting variables such as gender, age, educational qualification, designation, monthly income, and work experience. The analysis of these characteristics provides insights into the workforce composition and employment trends in the IT industry.
The gender distribution shows that male employees (57.33%) outnumber female employees (42.67%), reflecting a moderate gender gap that still favors male dominance in the IT sector. However, the relatively high participation of women indicates growing inclusivity and gender diversity in technology-driven occupations.
Table-1. Profile of Employees of IT Sector
Profile | Number of Employees of IT Sector | Percentage |
Gender | ||
Male | 172 | 57.33 |
Female | 128 | 42.67 |
Age Group |
|
|
21 – 25 years | 85 | 28.33 |
26 – 30 years | 97 | 32.33 |
31 – 35 years | 65 | 21.67 |
36 – 40 years | 53 | 17.67 |
Educational Qualification | ||
B.E. | 94 | 31.33 |
M.E. | 45 | 15.00 |
B.Tech. | 72 | 24.00 |
M.Tech. | 38 | 12.67 |
M.C.A. | 51 | 17.00 |
Designation | ||
Software Developer | 81 | 27.00 |
Software Designer | 67 | 22.33 |
Software Programmer | 96 | 32.00 |
Software Tester | 56 | 18.67 |
Monthly Income | ||
Rs.25,001 – Rs.30,000 | 90 | 30.00 |
Rs.30,001 – Rs.35,000 | 112 | 37.33 |
Rs.35,001 – Rs.40,000 | 59 | 19.67 |
Rs.40,001 – Rs.45,000 | 39 | 13.00 |
Work Experience | ||
1– 4 years | 79 | 26.33 |
5 – 8 years | 95 | 31.67 |
9 – 12 years | 71 | 23.67 |
13 – 16 years | 55 | 18.33 |
The age distribution reveals that the majority of employees fall within the age group of 26–30 years (32.33%), followed by 21–25 years (28.33%). This shows that the IT sector is largely dominated by young professionals who are in the early stages of their careers. Employees aged 31–35 years (21.67%) and 36–40 years (17.67%) represent a smaller proportion, suggesting fewer middle-aged professionals, possibly due to job mobility, career shifts, or migration to managerial roles.
Regarding educational qualifications, a large proportion of employees hold undergraduate technical degrees such as B.E. (31.33%) and B.Tech. (24%), which together constitute more than half of the workforce. Postgraduate qualifications like M.E. (15%), M.Tech. (12.67%), and M.C.A. (17%) make up the remaining segment, indicating that while higher education is valued, a bachelor’s degree remains the standard entry qualification for IT employment.
In terms of designation, Software Programmers form the largest group (32%), followed by Software Developers (27%), Software Designers (22.33%), and Software Testers (18.67%). This distribution highlights the technical and coding-centric nature of IT work, with a strong emphasis on software development and programming tasks.
Monthly income data indicate that most employees earn between Rs.30,001 and Rs.35,000 (37.33%), followed by those earning Rs.25,001–Rs.30,000 (30%). This shows that a majority of employees belong to the lower-middle-income bracket, possibly reflecting entry to mid-level positions. Only a small portion earns above Rs.40,000 (13%), suggesting limited representation in higher-paying or senior roles.
Work experience analysis shows that 31.67% of employees have 5–8 years of experience, while 26.33% have 1–4 years. This indicates that the sector employs a considerable number of early- to mid-career professionals. Those with 9–12 years (23.67%) and 13–16 years (18.33%) of experience form smaller groups, showing fewer long-term employees, possibly due to job shifts or overseas migration.
The data reflect that the IT sector is youth-dominated, technically skilled, moderately gender-diverse, and characterized by employees primarily in early and mid-career stages with modest income levels. The industry continues to attract young graduates, emphasizing the importance of technical education and professional skill development.
4.2. FACTORS INFLUENCING USE OF BALANCE SCORECARD IN IT SECTOR
An exploratory factor analysis is carried out with the purpose of investigating the factors that play a role in the implementation of balance scorecards in the information technology industry. The results of this investigation are summarized in Table-2 below.
It was discovered that there are four factors that together account for 74.46 percent of the variances; more specifically, each of these factors contributes 25.36 percent, 20.50 percent, 16.82 percent, and 11.78 percent variation, respectively. Factor-I consists of BSC has easy application, it is very easy to communicate plans through BSC, BSC makes employees’ job easy, BSC has flexibility in application and it is easy to learn and use BSC. Thus, this factor is named as Easy of Use.
Table-2. Factors Influencing Use of Balance Scorecard in IT Sector
Factor | Item | Rotated Factor Loadings | Eigen Value | % of Variation | Factor Name |
I | BSC has easy application | 0.70 | 2.87 | 25.36 | Easy of Use |
It is very easy to communicate plans through BSC | 0.68 | ||||
BSC makes employees’ job easy | 0.71 | ||||
BSC has flexibility in application | 0.67 | ||||
It is easy to learn and use BSC | 0.69 | ||||
II | BSC is useful for doing task | 0.66 | 2.31 | 20.50 | Usefulness |
BSC is useful for evaluation of performance | 0.60 | ||||
BSC is helpful for management control for execution of plans | 0.65 | ||||
BSC is helpful to improve skills of employees | 0.63 | ||||
III | Hiring and holding the best employees is important | 0.66 | 1.19 | 16.82 | Control System |
Good organizational culture is important | 0.61 | ||||
The activities are controlled by rules and regulations | 0.65 | ||||
The other control tools are complementing with BSC | 0.64 | ||||
IV | The subordinates are assessed through financial vs non financial measures | 0.68 | 1.02 | 11.78 | Evaluation Style |
The subordinates are evaluated with qualitative Vs quantitative information | 0.63 | ||||
| Cumulative of Variation (%) | – | – | 74.46 | – |
| Cronbach’s Alpha Value | – | – | – | 0.87 |
Rotation is converged in 9th iterations.
Factor-II includes BSC is useful for doing task, BSC is useful for evaluation of performance, BSC is helpful for management control for execution of plans and BSC is helpful to improve skills of employees. Hence, this factor is named as Usefulness. Factor-III comprises of hiring and holding the best employees is important, good organizational culture is important, the activities are controlled by rules and regulations and the other control tools are complementing with BSC. Therefore, this factor is named as Control System.
Factor-IV encompasses the subordinates are assessed through financial vs non financial measures and the subordinates are evaluated with qualitative vs quantitative information. So, this factor is named as Evaluation Style. Cronbach’s Alpha value of the scale is 0.87 revealing each measure is at acceptable level of internal consistency. Easy of use, usefulness, control system and evaluation style are the factors influencing use of balance scorecard in IT sector.
4.3. FACTORS INFLUENCING USE OF BALANCE SCORECARD IN IT SECTOR AND PROFILE OF EMPLOYEES
The results presented in the table provide a comprehensive understanding of how various demographic and professional factors significantly influence the use of the Balanced Scorecard (BSC) as a strategic performance management tool. The findings indicate statistically significant relationships across all examined variables, as evidenced by high t-values/F-values and corresponding p-values less than 0.01, confirming strong associations between each factor and the utilization of the Balanced Scorecard.
Table-3. Use of Balance Scorecard in IT Sector and Profile of Employees
Particulars | t-Value/ F-Value | Sig. |
Factors Influencing Use of Balance Scorecard and Gender | 9.416** | .000 |
Factors Influencing Use of Balance Scorecard and Age Group | 16.527** | .000 |
Factors Influencing Use of Balance Scorecard and Educational Qualification | 14.840** | .000 |
Factors Influencing Use of Balance Scorecard and Designation | 17.652** | .000 |
Factors Influencing Use of Balance Scorecard and Monthly Income | 19.728** | .000 |
Factors Influencing Use of Balance Scorecard and Work Experience | 15.590**
| .000 |
** Significant at one per cent level
The relationship between gender and the use of the BSC (t = 9.416, p = .000) suggests that perceptions, preferences, or exposure to performance evaluation tools may vary between male and female employees. This difference could be attributed to variations in role responsibilities, managerial exposure, or training opportunities across genders. Similarly, age group (F = 16.527, p = .000) plays a significant role, indicating that employees at different life stages may exhibit varying levels of understanding, adaptability, and acceptance toward the Balanced Scorecard. Younger professionals might be more open to innovative performance systems, while older employees may rely on traditional evaluation methods.
Educational qualification (F = 14.840, p = .000) also strongly influences BSC usage, emphasizing that individuals with higher education levels tend to better understand strategic frameworks and performance measurement tools. Designation (F = 17.652, p = .000) demonstrates that senior or managerial roles are more engaged with the BSC due to their involvement in strategic planning and organizational goal-setting. Monthly income (F = 19.728, p = .000) reflects a direct link between compensation level and familiarity with BSC practices, possibly because higher-income employees often occupy decision-making positions. Finally, work experience (F = 15.590, p = .000) indicates that experienced employees, having greater exposure to performance systems, are more likely to appreciate and implement the Balanced Scorecard effectively.
The findings collectively confirm that demographic and professional attributes significantly affect the adoption and use of the Balanced Scorecard, highlighting the importance of customized training and awareness programs to ensure effective implementation across all employee segments.
4.4. IMPACT OF FACTORS INFLUENCING USE OF BALANCE SCORECARD IN IT SECTOR ON DECISION MAKING
Multiple regression is employed, and Table-4 presents the findings, in order to determine how factors that influence the adoption of balance scorecards in the information technology industry affect the decision-making process.
Table-4. Factors Influencing Use of Balance Scorecard in IT Sector on Decision Making
Factors Influencing Use of Balance Scorecard | Regression Coefficients | t-value | Sig. |
Intercept | 1.014** | 8.960 | .000 |
Easy of Use (X1) | .385** | 6.732 | .000 |
Usefulness (X2) | .412** | 7.054 | .000 |
Control System (X3) | .346** | 6.275 | .000 |
Evaluation Style (X4) | .327** | 5.816 | .000 |
R2 | 0.63 |
|
|
Adjusted R2 | 0.61 |
|
|
F | 25.070 |
| .000 |
** Significance at one per cent level
It may be concluded that the regression model is a good match because the coefficient of multiple determination (R2) is 0.63 and the corrected R2 is 0.61. It may be deduced from this that the independent variables are responsible for explaining 61.00 percent of the variation in the dependent variable. The fact that the model is significant may be deduced from the fact that the F-value is 25.070, which is significant at the 1% level. The usefulness, easy of use, control system and evaluation style have positive and significant impact on decision making at one per cent level.
Conclusions
From the facts shown above, one may draw the conclusion that the elements that impact the adoption of balance scorecards in the information technology sector are the ease of use, usefulness, control system, and assessment style. There is a significant gap between the types of employees in the IT industry when it comes to the elements that influence the utilization of balanced scorecards. The decision-making process is being significantly influenced, for the better, by aspects such as usefulness, ease of use, control system, and evaluation style. The balanced scorecard is widely utilized by the IT firms since it is extremely helpful for the measuring of performance, as well as for the implementation of plans and the making of decisions. It is also important to assist the adoption of balanced scorecards by developing them in such a way that they are coordinated with other control systems and assessment styles that are used in IT organizations. In addition, management at IT companies needs to ensure that the balanced scorecard is straightforward and easy to use in order for employees to effectively complete a variety of tasks. Furthermore, information regarding the balanced scorecard needs to be made clear and simple for workers to comprehend. So, an effective balanced scorecard that measures for the evaluation of the performance of employees is quite important for making efficient decisions in the information technology industry.
Acknowledgement
We express our gratitude to the Department of Management, NSB B School, Bangalore Karnataka. The college management, faculty members are supporting me to preparation of the empirical paper.
Declaration
All authors confirm that this document was never submitted to any conference, seminar, national or international journal before. We’re not declaring any conflicts of interest.
Ethic Approval
There no ethical issue applicability in this study.
Declaration of Artificial Intelligence (AI)
We have not used artificial intelligence for data collection, analysis and conceptual writing. AI support taken to improve clarity and readability of the English language for readers.
Funding
No institute provides financial support for the preparation of research investigations.
Table of Contents
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