An An Integrated Approach to Evaluating Performance Measurement Systems in Tanzanian SMEs: A Mixed-Method Study in The Tourism Sector

Abstract

This research examines how small and medium enterprises (SMEs) in Tanzania’s tourism sector, particularly in accommodation, use performance measurement systems. The study aimed to: 1) analyze the influence of factors like environmental uncertainty, ethnic ownership, business size, and strategic orientation on the adoption of these systems; 2) investigate the methods SMEs employ for implementation; and 3) explore the impact of these systems on organizational capabilities namely resource teaming, routine establishment, entrepreneurial spirit, and innovativeness and overall performance. A mixed-methods approach was adopted, employing semi-structured interviews and surveys, with data analysed using NVivo and Structural Equation Modelling. Findings indicate that the contextual factors significantly affect the use of performance measurement systems and, indirectly, organisational performance through enhanced capabilities. This research adds valuable insights to management accounting literature and offers practical guidance for SMEs and policymakers to foster effective business management in the tourism industry.

Keywords: Performance measurement systems; SMEs; Business management