The Reciprocal Influence of Parent-Subsidiary Relationships and Enterprise Systems Implementation

Cucuk Budiyanto

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Doctoral Thesis / Dissertation from the year 2016 in the subject Business economics - Information Management, grade: 4, Swinburne...

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Doctoral Thesis / Dissertation from the year 2016 in the subject Business economics - Information Management, grade: 4, Swinburne University of Technology, Melbourne (Faculty of Business and Law), course: PhD - Information Systems, language: English, abstract: This research focuses on the investigation of the reciprocal influence between the relationships of parent and subsidiary company of corporate groups and the implementation of the Enterprise Systems in subsidiary company. Pertinent to the exploration is how power differential being transpired in the relationships between a holding and subsidiary company of corporate groups during the implementation of Enterprise Systems. The literature on corporate groups indicates that the relationships between holding and subsidiary companies in the corporate groups are ingrained with power that is associated with the authority, control, and the ability to influence. The aim of this research is to investigate the key aspects of the relationship between parent and subsidiary companies in corporate groups and their impacts on organisation's Enterprise Systems adoption and implementation. This research also anticipated Enterprise Systems to be one aspect that drives the change in the relationship between parent and subsidiary company. An interpretive paradigm is the assumed philosophical stance in this research. The case study research method with embedded cases was chosen as the main research approach. Two case studies with five embedded cases were explored. The participating corporate groups were a privately-owned corporate group and a state-owned corporate group in Indonesia. Semi-structured interviews were used for data collection and qualitative content analysis technique was used in analysing the interview data. The outcome of the investigation demonstrates three aspects in the relationships between a parent and subsidiary company of corporate groups during the implementation of Enterprise Systems that may be beneficiary for practitioners and researchers interested in the use of IS/IT (particularly in developing countries). The holding company should consider the individual business requirements and the "uniqueness" of the subsidiary company in issuing directives for the implementation of Enterprise Systems in subsidiary companies. The second aspect underlines the importance of the holding company to provide strategic directives to achieve the corporate group vision while facilitating and/or enabling the achievement of the subsidiary's own business objectives. The third emphasises on the importance of the communication between corporate group members, particularly in the design and implementation of the appropriate Enterprise Systems.