Operations management and corporate entrepreneurship: The moderating effect of operations control on the antecedents of corporate entrepreneurial activity in relation to innovation performance

Abstract

Research on the topic of corporate entrepreneurship has expanded steadily over the last few decades, in large part due to the increasingly recognized linkages between product-market and technological innovation (i.e., consequences of corporate entrepreneurial activity) and firm success. Likewise, growing evidence suggests that effective operations control is a common quality of successful firms. On the surface the two phenomena—corporate entrepreneurship and operations control—may seem to be inherently at odds. That is, corporate entrepreneurship is aimed at taking the firm in new directions, while operations control is aimed at channeling and often restricting actions. As such, it would be useful to know how operations control variables act in concert with the determinants of corporate entrepreneurial activity to promote the innovation outcomes that facilitate long-term organizational success. In this study of 177 firms operating in a wide variety of industries, we investigate the effect on innovation performance of several commonly-acknowledged antecedents of corporate entrepreneurship, as measured by the Corporate Entrepreneurship Assessment Instrument (e.g., Hornsby et al., 2008, 2002); namely, management support, work discretion/autonomy, rewards/reinforcements, time availability, and organizational boundaries. More importantly, we examine the moderating effects of operations control variables – specifically risk control and process control formality – on the relationships between the antecedents of corporate entrepreneurship and innovation performance. Results indicate that only two of the five antecedents to corporate entrepreneurship have main effects on innovation performance with moderate significance. However, each of the five antecedents significantly interacts with one or both of the operations control variables and, thereby, influences innovation performance. The implications of these results in relation to operations management and corporate entrepreneurship theory and practice are discussed.