The performance effects of management control instruments in different stages of new product development

Abstract

Purpose The study builds on existing research in management control (MC) and innovation management. The purpose of this study is to identify patterns in the application of MC instruments which contribute to successful innovation. The application of MC instruments can reduce potential risks and make the new product development (NPD) process more transparent and efficient. Design/methodology/approach The authors use dyadic data to determine the effect of 58 MC instruments on NPD process stage-specific performance and subsequent innovation and firm success. To provide empirical evidence of each MC instrument’s effectiveness, three importance-performance matrix analyses were conducted that assess the impact of each MC instrument. Findings The authors identify patterns in the application of MC instruments which contribute to successful innovation activities and the authors determine the impact of MC instruments on NPD performance, innovation performance and firm performance in different stages of the NPD process. Practical implications The authors provide knowledge that can be used by managers to review their actual application of MC in the NPD process and to select their instrument set. Originality/value The authors contribute to the MC literature by examining data from a cross-industry study on the effects of MC instruments during the NPD process. The authors include a comprehensive set of MC instruments and show how their effect changes between the different stages of the NPD process.