Interactive control capability, effective organizational learning and firm perfor-mance: An empirical study of milling and metal industry in Tegal

Abstract

This study seeks to utilize the theoretical literature and empirical studies of human resource management, resourced based view and management control system to derive the concept of interactive control capabilities, in an effort to explore the role of effective organizational learning on the capabilities of technological innovation and company performance. The study places the importance of interactive control capabilities and capabilities of technological innovation as an important element of company performance. The study was conducted in the smelting and metalwork industry in Tegal, since Tegal was nicknamed the innovative Indonesian Japanese whose industries were carried out by skilled hands and simple tools. Amos 24 software was used as a multivariate analysis tool to verify the hypothesis. The research findings verify the correlation between effective organizational learning and the capabilities of technological innovation and company performance by mediating interactive control capabilities. Based on the empirical research findings, the recommendations offered are the concept of interactive control capabilities that play an important role in improving innovative capabilities and business performance. Technological innovation is one of the drivers and fundamental instruments of growth strategy. The involvement of top management which is accompanied by the exchange of interactive information will motivate the learning process in all organizations to avoid uncertainty while ensuring that the information is not manipulated by subordinates, as well as updating strategies.

Keywords

• Effectively organizational learning
• Interactive control capability
• Effective commitment
• Technological innovation capability and firm performance