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Using performance measures conceptually in innovation control

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  • Sebastian Janssen
  • Klaus Moeller
  • Marten Schlaefke

Abstract

In recent years, companies have been changing their innovation strategies, as they have realized that original new products can offer a major competitive advantage. Therefore, many companies are focusing on a more closely managed product-innovation process, and have consequently increased their use of performance-management frameworks. By doing so, such companies hope to increase the effectiveness and efficiency of their new-product-development activities. Within the performance-management framework, the use of innovation metrics plays an important and beneficial role. For this reason, the present paper investigates the relationship between the design of innovation performance management frameworks and the actual utilization of information obtained from the implemented innovation metrics. We collected data from 133 technology-intensive companies and employed structural equation modeling for empirical analysis. This method allowed us to determine which design factors positively affect the extent to which managers conceptually use innovation metrics. In particular, we investigated how the balance, coherence, adaption, and user know-how of innovation metrics relate to their conceptual use. Our results suggest that balance and user know-how of the metrics improve conceptual use of the performance measures, whereas no effect can be observed regarding coherence and adaption of the metrics. Thus, it seems highly advisable for firms to implement a simple, comprehensible performance management framework, consisting of financial and nonfinancial performance measures. Copyright Springer Verlag 2011

Suggested Citation

  • Sebastian Janssen & Klaus Moeller & Marten Schlaefke, 2011. "Using performance measures conceptually in innovation control," Metrika: International Journal for Theoretical and Applied Statistics, Springer, vol. 22(1), pages 107-128, September.
    • Handle: RePEc:spr:metrik:v:22:y:2011:i:1:p:107-128
    DOI: 10.1007/s00187-011-0130-y
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    2. Ellen Haustein & Robert Luther & Peter Schuster, 2014. "Management control systems in innovation companies: a literature based framework," Metrika: International Journal for Theoretical and Applied Statistics, Springer, vol. 24(4), pages 343-382, February.
    3. Samir Harith & Ruth Helen Samujh, 2020. "Small Family Businesses: Innovation, Risk and Value," JRFM, MDPI, vol. 13(10), pages 1-15, October.
    4. Emmi Tervala & Teemu Laine & Tuomas Korhonen & Petri Suomala, 2017. "The role of financial control in new product development: empirical insights into project managers’ experiences," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 28(1), pages 81-106, February.
    5. Kaveh Asiaei & Nick Bontis & Omid Barani & Ruzita Jusoh, 2021. "Corporate social responsibility and sustainability performance measurement systems: implications for organizational performance," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 32(1), pages 85-126, March.
    6. Rosanna Spano & Fabrizia Sarto & Adele Caldarelli & Riccardo Vigano, 2016. "Innovation & Performance Measurement: An Adapted Balanced Scorecard," International Journal of Business and Management, Canadian Center of Science and Education, vol. 11(6), pages 194-194, May.
    7. Ilse Svensson de Jong, 2021. "When Wrong Is Right: Leaving Room for Error in Innovation Measurement," JRFM, MDPI, vol. 14(7), pages 1-14, July.
    8. Eva Lövstål & Anne-Marie Jontoft, 2017. "Tensions at the intersection of management control and innovation: a literature review," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 28(1), pages 41-79, February.
    9. Schönefeld, Carsten & Möller, Klaus & Engelhardt, Philipp, 2015. "Erfolgstreiber Innovationskennzahlen," Die Unternehmung - Swiss Journal of Business Research and Practice, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 69(3), pages 322-350.
    10. Andrea Fried, 2017. "Terminological distinctions of ‘control’: a review of the implications for management control research in the context of innovation," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 28(1), pages 5-40, February.
    11. Müller-Stewens, Benedikt & Widener, Sally K. & Möller, Klaus & Steinmann, Jan-Christoph, 2020. "The role of diagnostic and interactive control uses in innovation," Accounting, Organizations and Society, Elsevier, vol. 80(C).

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