Balancing stability and innovation in knowledge-intensive firms: the role of management control mechanisms

Knowledge-intensive firms are composed of various communities, each characterized by specialized knowledge. These communities operate as critical agents in the organizational action because the relevant processes and the variety/variability of environment and technology are too complex for a single individual to understand in their entirety. They generate new models for interpreting reality and responding to customer needs thanks to the integration of knowledge taking place within and between them. The objective of this chapter is to provide some criteria for evaluating the comparative effectiveness and efficiency of combinations of control mechanisms in the regulation of these knowledge integration processes. On the basis of the characteristics of knowledge (level of complexity and diversity), a different set of control mechanisms is proposed, with a variation in their specific features to guarantee that the resulting modes of communication and cognition can guarantee the required level innovation, without however preventing a certain level of stability.