Small and medium scale enterprises (SMEs) are very important in any economy and doubly so in a developing economy such as Nigeria, more also balanced scorecard is a framework which has been widely used during the last decade for performance measurement in different disciplines. There for the study aimed to investigate whether there is any relationship between the internal business process and financial perspective of balanced scorecard on the performance of SMEs in Ilorin; to examine the relationship between the innovation and customer perspective of balanced scorecard on the performance of SMEs in Ilorin and to assess the effect of non-adoption of balanced scorecard by small and medium scale enterprises in Ilorin. The descriptive survey research design was used, model was specified and Simple random sampling was used in determining the sample size. 100 copies of questionnaires were distributed to management team of the sampled SMEs (10 each to every selected SME), out of which 91 were duly completed and returned. Data was presented by the use of frequency and percentage tables. Hypotheses were tested using regressions analysis and correlation and findings from the study revealed that financial perspective emphasize the ability to deliver maximum value to the customer at minimum cost and this sustained stakeholder value also high number of Small and Medium Scale Enterprises uses performance measures & indicators similar to those typically included within a balanced scorecard model. It was concluded that there is significance relationship between the innovation and customer’s perspective of balanced scorecard on the performance of SMEs in Ilorin and there is also a significance relationship between the internal business process and financial perspective of balanced scorecard on the performance of SMEs in Ilorin. It was recommended that the performance measures & indicators similar to those typically included within a balanced scorecard model can also be used to measure some or all of the four perspectives of balanced scorecard furthermore, there should be an awareness to management/owners of Small and Medium Scale Enterprises on usefulness in the adoption of balanced scorecard techniques.

TABLE OF CONTENTS

       pages

Title pagei

Certificationii

Attestationiii

Dedicationiv

Acknowledgementv

Table of contentsvii

Abstractx

CHAPTER ONE: INTRODUCTION

1.1 Background of the Study1

1.2 Statement of the Problem3

1.3 Research Questions4

1.4 Objectives of the Study5

1.5Hypotheses of the Study5

1.6 Justification for the Study6

1.7 Scope of the Study6

1.8 Definition of Terms7

1.9Plan of the Study7

CHAPTER TWO: LITERATURE REVIEW

2.1 Introduction8

2.2 Conceptual Issues8

2.2.1 Performance Measurement8

2.2.2 Financial Measures of Performance9

2.2.3 Non-financial Measures of Performance10

2.2.4 Balanced Score Card11

2.2.5 The BSC as a Performance Measurement System12

2.2.6 The BSC as a Strategic Management System14

2.2.7 The Four Perspectives of the BSC17

2.2.8 Benefits of Adopting the BSC19

2.2.9 Problems that may Arise in Introducing the BSC21

2.2.10 Small and Medium scale Enterprise24

2.3 Theoretical Background26

2.3.1 Agency Theory26

2.3.2 Stakeholder Theory26

2.3.3 Contingency Theory27

2.4 Empirical Evidences29

2.5 Research Gap Filled39

CHAPTER THREE: METHODOLOGY

3.1. Model Specification41

3.2 Research Design42

3.3 Population and Sample Size42

3.4 Sampling Technique42

3.5 Sources of Data43

3.5.1 Secondary Data43

3.5.2 Primary Data43

3.6 Method of Data Collection44

3.7 Method of Data Analysis44

CHAPTER FOUR: PRESENTATION, INTERPRETATION AND ANALYSIS OF DATA

4.1 Introduction46

4.2 Data Presentation and Analysis46

4.3 Analysis of Operational Variables50

4.4 Model Estimation Result and Testing of Hypotheses55

CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS

5.1 Summary60

5.2 Conclusion60

5.3 Recommendations61

5.4 Suggested Areas for Further Research62

References63

Appendix I66

Appendix II69

Appendix III78