Purpose – In spite of the large body of literature on success factors of enterprise resource planning (ERP) implementation, there is a need to explore its multinational dimension. The purpose of this paper is to explore the impact of the conflict between parent and subsidiary on the process of ERP implementation in a multinational enterprise (MNE).
Design/methodology/approach – Using an interpretive case study methodology, this paper analyses the theoretical frameworks of parent-subsidiary conflict and applies them to interpret an indepth case study and generate a set of managerial prescriptions.
Findings – Theoretical analysis and case evidence suggest that managing parent-subsidiary conflict is a critical success factor of ERP implementation in MNEs.
Research limitations/implications – This case relates to a diversified multinational group producing a variety of materials through subsidiaries. The data collection includes multiple sources in the company, and strong theoretical development provides a high level of generalizability. The paper shows that managers should consider the impact of conflict from the planning stages of any multinational ERP implementation.
Practical implications – A detailed set of practical managerial prescriptions is derived from case and theoretical analysis. These prescriptions provide guidance to multinational managers planning a successful global ERP rollout.
Originality/value – Although parent-subsidiary conflict is clearly a major factor in multinational ERP implementations, this topic has never been analysed in detail in the literature. This paper breaks new ground applying grounded theoretical frameworks of parent-subsidiary conflict to an implementation case, and providing managerial guidance for implementation decisions.
1. Introduction The process of enterprise resource planning (ERP) implementation is a key strategic intervention that presents an opportunity for long-term process improvement (Davenport, 1998). ERP has been a broadly researched topic in Information Systems and Operations Management journals. The main topics of recent research in ERP include ERP implementation, optimization, management, the ERP tool, supply chain management, studying the ERP concept, use of ERP in education, and analysis of the ERP industry (Schlichter and Kraemmergaard, 2010). A large body of literature has focused on determining the critical success factors of ERP implementations (Bingi et al., 1999; Chou and Chang, 2008; Dezdar and Sulaiman, 2009; Dowlatshahi, 2005; Finney and Corbett, 2007; Françoise et al., 2009; Gargeya and Brady, 2005; Ho and Lin, 2004; Huang, 2010; Loh and Koh, 2004; Malhotra and Temponi, 2010; Motwani et al., 2005; Nah and Delgado, 2006; Ngai et al., 2008; Plant and Willcocks, 2007). Critical success factors cited in the literature are remarkably consistent, and include top management support, team management and composition, organizational change management, business process reengineering, communication, project management, data migration, and user training.