Managing for innovation: Managerial control and employee level outcomes

Considerable effort is made by organizations to increase long-term firm performance through innovation. Despite the emphasis on innovation as a source of renewal, relatively little is known about the effective management of human resources supporting innovation efforts. Prior research supports a negative impact of managerial control on the motivation of employees. Following on recent theoretical developments, we argue that the impact of managerial control will differ based on the type of knowledge being used. Using data from 104 members of product development teams working on new product development or current product management, our findings suggest that the use of control can have differing effects on motivation depending on the attributes of the knowledge involved. Specifically, tests of moderation indicated the negative impact of control on employee motivation is much greater when the knowledge being used is less complete (those working on the development of new products).