Market segmentation of non-adopters of balanced scorecard using CHAID analysis

Organisations believe that the adoption of popular management tools enables them to radically improve their performance. Balanced scorecard (BSC) is one of the popular tools that have been gaining prominence globally and are also being adopted by Indian organisations for performance improvement and strategic alignment. The research outlines the prospective market segments towards balanced scorecard implementation. A criterion-based scheme integrating chi-square automatic interaction detection algorithm (CHAID) has been utilised to separate the responding organisations into mutually exclusive segments. Among the four resultant segments, two are identified as actionable segments according to the gain index score resulting from the CHAID algorithm. The results from the study also indicate that there are significant variations in demographic characteristics among the respondent organisations grouped into actionable and non-actionable ones. With analyses of two actionable segments, variations in demographic characteristics are also manifested in this research. It has been observed that the motivations for organisations to adopt balanced scorecard and the inhibitions amongst non-adopting organisations towards balanced scorecard adoption require intense research attention.