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The complementarity of control formalization and control flexibility: The contingent effects of competitive turbulence

Author

Listed:
  • Feifei Yang

    (Asia Europe Business School, Faculty of Economics and Management, East China Normal University, Shanghai, China)

  • George A Shinkle

    (UNSW Business School, UNSW Sydney, Sydney, NSW, Australia)

  • Mirjam Goudsmit

    (Nijmegen School of Management, Radboud University, Nijmegen, The Netherlands)

Abstract

We examine how the complementarity of control formalization and control flexibility influences organizational performance across contexts of varying competitive turbulence. We build contingency arguments anchored in the efficiency logic of control theory and investigate both the restrictive and facilitative views of control formalization. Our empirical evidence is based on a survey of top executives from 536 organizations across the United States, Australia, China, and Israel. We find that control formalization and control flexibility are complementary in environments of low competitive turbulence. With increasing turbulence, the complementarity diminishes and shifts toward substitutive effects. JEL Classification: L2

Suggested Citation

  • Feifei Yang & George A Shinkle & Mirjam Goudsmit, 2022. "The complementarity of control formalization and control flexibility: The contingent effects of competitive turbulence," Australian Journal of Management, Australian School of Business, vol. 47(4), pages 773-792, November.
    • Handle: RePEc:sae:ausman:v:47:y:2022:i:4:p:773-792
    DOI: 10.1177/03128962211067648
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    More about this item

    Keywords

    Competitive turbulence; control flexibility; control formalization; control theory; organizational control;
    All these keywords.

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

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