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Performance Measurement Systems Threatened by Pandemic Opportunities in Retail: How Managers Struggled to Balance Growing Sales With Unexpectedly Inadequate Supply Chain KPIs
Abstract
Performance measurement systems such as KPIs are necessary managerial tools to set targets and monitor performances. During the outbreak of COVID-19, some companies experienced threats to traditional and consolidated business lines. The retail sector saw no decline in turnover. The aim of the chapter is to uncover and analyse the challenges imposed by COVID-19 to the retail sector as well as possible solutions implemented in order to overcome such difficulties. The chapter reports the case study of the largest retailer in Italy during the COVID-19 pandemic. Although seeing sales increase, the managers had many difficulties on the side of procurement and distribution of goods. The performance monitoring system was suddenly insufficient to manage the emergency. The solutions concerned the adjustment of the algorithms with dynamic components addition to KPIs and the conversion of some efficiency targets into effective ones. The chapter suggests insights on how performance measurement systems can be designed and developed in advance to allow more dynamism during emergencies.
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