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The impact of a firm’s internal control mechanisms on the choice of innovation mode

Abstract

A firm’s internal control mechanisms may have a significant influence on the choice of innovation mode. Therefore, based on the research on the internal control mechanisms of companies, we developed a model to explore the relationship between a firm’s internal control mechanisms and the choice of innovation mode. Using a sample of 585 Chinese firms, this study tests the proposed model. Results show that strategic control has a positive relationship with radical innovation, but a negative relationship with incremental innovation, while financial control has a negative relationship with radical innovation, but a positive relationship with incremental innovation.

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Correspondence to Xinmin Liu or Yuan Li.

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Translated from Nankai Guanli Pinglun 南开맜理评论 (Nankai Business Review), 2006(2): 64–68

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Liu, X., Li, Y., Su, Z. et al. The impact of a firm’s internal control mechanisms on the choice of innovation mode. Front. Bus. Res. China 1, 91–101 (2007). https://doi.org/10.1007/s11782-007-0006-z

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Keywords

  • strategic control
  • financial control
  • radical innovation
  • incremental innovation