Strategic responses to Performance Measurement in Nonprofit ...

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P3: The higher the dependency will be from one particular funder the more a
nonprofit will comply with the specific accountability expectations voiced by this
specific funder.
In line with the institutional theory one could argue that the likeliness of a decoupling
increases if the performance measurement is externally imposed. Therefore preposition 4
proposes:
P4: A decoupling is more likely if the performance measurement system is externally
imposed. The more the performance measurement is tailor-made to internal needs the
lesser the likeliness of a decoupling is.
If we look at the results of both empirical studies by Greiling then it becomes obvious that the
degree of external pressure can only partly explain why a performance measurement system is
not well advanced. Although the majority of performance measurement systems were self-
developed they were nevertheless well advanced. With respect to a more strategic or
diagnostic orientation of the performance measurement implemented one could argue, in line
with the contingency theory, that it plays a role if the nonprofit operate in a field with a low or
high intensity of competition. The higher the competitive pressure the less will be the interest
by a single nonprofit to take part in strategic benchmarking process. Therefore preposition 5
and 6 reads as follows
P5: The higher the competitive pressure the more importance is attached to the
purpose of performance measurement as strategy implementation instrument.
P6: The higher the competitive pressure the lesser a nonprofit organisation will be
interested in a strategic benchmarking process.
Preposition 6 also assumes that in a competitive environment nonprofits will pursue a closed
shop mentality against their competitors and their inclinations what works as success factor is
low. For the role of the active opposer this would mean that an area-wide cooperation of
nonprofits is less likely. Each nonprofit provider will try to gain an individual advantage. A
joint action would entail the danger of free-riding nonprofits.