Innovation and control in the multinational firm: A comparison of political and contingency approaches

Authors

  • Björn Ambos,

    Corresponding author
    1. Institute for International Marketing and Management, Vienna University of Economics and Business Administration, Vienna, Austria
    • Institute for International Marketing and Management, Vienna University of Economics and Business Administration, Augasse 2–6, 1090 Vienna, Austria.
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  • Bodo B. Schlegelmilch

    1. Institute for International Marketing and Management, Vienna University of Economics and Business Administration, Vienna, Austria
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Abstract

This study focuses on control mechanisms used by multinational corporations (MNCs) to manage their extra-national R&D units. Drawing on both the literature on organizational power and contingency theory, this study develops and empirically tests a set of hypotheses aimed at explaining how headquarters control their overseas R&D units. Data collected from 134 R&D units of German MNCs serve to test the hypotheses. Results highlight the importance of the units' R&D mandate and its interdependence in explaining control mechanisms. Moreover, they indicate a relatively weak predictive power of political approaches compared to contingency approaches. Copyright © 2007 John Wiley & Sons, Ltd.

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