How to Fill the Gap Between Knowledge and Innovation
Edited by Jean Bonnet, Domingo García Pérez De Lima and Howard Van Auken
Chapter 8: Innovative Culture, Management Control Systems and Performance in Young SMEs
8. Innovative culture, management control systems and performance in young SMEs Domingo García Pérez De Lema and Antonio Duréndez 8.1 INTRODUCTION Research focus on young firms within the field of entrepreneurship is a common topic, due to the relevance and potential for growth, innovation and economic force (Biga et al., 2008). The analysis of young firms’ performance, principally growth, has received substantial empirical and theoretical attention (Steffens et al., 2006). Usually, young firms should be inside the period of expansion, so these firms are characterized by their ability to identify new business opportunities (Penrose, 1959). According to the knowledge-based view of the firm young firms accumulate knowledge through a learning process which constitutes the driving force for growth in order to achieve a sustainable competitive advantage. This is seen as the source of change and dynamism in society and the economy (McQuaid, 2002; Spender and Grant, 1996). Furthermore, young firms have cognitive learning advantages in entirely new markets because of fewer systemic rigidities (Autio et al., 2000). Another characteristic of young firms is they have several objectives, such us: maintaining autonomy, high-quality innovation, new opportunity detection and solid growth (Fischer and Reuber, 2004). Analysing young firms is particularly relevant due to the high level of failure this kind of firm shows (Brown et al., 1990; Philips and Kirchhoff, 1989). Previous economic research literature confirms that bankruptcy is inversely related to the age of the company (Audretsch and Mahmood, 1994; Dunne et al., 1988; Mata and Portugal, 1994;...
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