The impact of a fi rm’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.