Integrated Performance Measurement System: Prevention of Bankruptcy

The prerequisite for the success and competitiveness of businesses is their performance. Businesses, which achieve high performance in the long-term, are able to avoid negative phenomena in their life cycle, especially failure or bankruptcy. In order to ensure the performance of enterprises, it is necessary to create an effective performance measurement system. A significant contribution in this area was the introduction of the Balanced Scorecard (BSC) method. The aim of the paper was to identify key performance features and to design an integrated performance measurement system for a selected sample of construction companies. The system of performance measures was built on BSC principles. The Least absolute shrinkage and selection operator (Lasso) method was used to select financial features. The contribution of the paper is the creation of an integrated model based on the combination of data mining techniques and BSC principles. This model makes it possible to benefit from the advantages of different types of methods when identifying most important performance drivers. Linking data mining techniques with business performance measurement methods appears to be very important for achieving significant results. Findings also include the identification of key performance features for the given industry sector.