Top management control and knowledge creation in new product development

The purpose of this paper is to examine the role of top management control in stimulating innovation through their effect on the creation of knowledge in new product development (NPD) projects. Top management has a crucial role in stimulating innovation in companies, in particular as top managers affect knowledge creation through their interaction with project teams before and during an NPD project, which can of course affect innovation.

Through comparative case‐based research in two companies in high‐velocity industries, chosen through theoretical sampling, the authors have studied six NPD projects.

The control top management exercise over an NPD project influences the creation of knowledge in different ways, both hampering and facilitating knowledge creation. In particular, this control focuses on explicit knowledge, and not tacit knowledge, which may reduce the overall capacity for knowledge creation and ultimately innovation.

The results are considered to be generalizable within high‐velocity industries. In terms of future research the results should be tested in other industries using either case‐based research or by increasing the sample and doing survey‐type research.

The advice, or perhaps challenge, for managers is to know when to exercise control, when not to and what type of control to exercise. In particular the paper highlights the importance of managers not solely controlling projects by focusing on explicit knowledge in the project, but also by understanding that tacit knowledge is necessary in order to facilitate knowledge creation and innovation.

The paper helps clarify the relationship between top management control and knowledge creation by specially examining how and why top management control hampers or facilitates knowledge creation.