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In today’s world, organizational networks often require a deep understanding of the cultural contexts in which the organization operates. While cross-cultural leadership has received enough scholarly attention, its relevance in the context of global organizations and specifically when communication takes place through electronic mediums remains an under-investigated area. This study analyzes data from a parent company and subsidiary using Actor-Network Theory and its recent application for digital innovations. Specifically, it considers how cross-cultural organizational complexities enable or disrupt ERP modifications, specifically asking what role leaders are expected to play to enhance innovation. Making the sample representative of cultural variation while also fulfilling requirements of organizational networks (inter and social networks), the study investigates parent-subsidiary relations in many geographical areas and how leadership enhances or disrupts innovation. The study employs organizational network analysis (ONA) to assess the extent to which leaders in parent and subsidiary companies are receptive to changes; the study employs organizational network analysis (ONA). This will investigate how lack of adaptability in a digital context prevents ERP innovation that can enhance productivity. By employing a technique previously used mainly by consultancies, the study aims to show how industrial and academic research methodologies can learn from each other.
A broader network theory encompasses various aspects of organizational networks, cultural differences, innovation, and how electronic leadership (e-Leadership) size up to each mentioned variable in an organizational context. This study invites respondents from an MNE that conducted a company-wide system upgrade to standardize the system in 18 international markets to streamline the organizational process to help speed up the innovation cycle of the MNE to target the consumers better. The study adopts Organizational Network Analysis adopted from industrial consulting literature to measure the organizational networks. Organizational networks, innovation, cultural difference, and e-Leadership as variables are explored in the databases to identify intersectional studies previously done even if 2 of the variables were studies in prior literature. Some interesting studies were identified, and a database of the selected literature was created in excel:
Figure 1.
Database of the selected literature was created in excel
The database was created in chronological order to keep the previous studies comparable and identify the common themes used in the literature pertaining to the variables this study aims to explore. Studies that fall in the domain of previous literature received more scholarly attention in citations. Studies that attempted to identify new avenues didn’t receive much scholarly attention.
Study Design
The MNE understudy rolled out ERP in 76 foreign markets, 40% budget variance threshold was set for all the installations. Eighteen foreign subsidiaries exceeded the threshold, abandoning the transition to the standardized Erp system. These 18 foreign markets were in Asia, Europe, and Africa. Interestingly, these 18 foreign subsidiaries also had the highest number of legacy systems, resulting in many patchworks or distributed systems in each market. These 18 Foreign subsidiaries will constitute our respondents for the study (25 respondents per market).
Table 1.
Background of the MNE, 18 Foreign Markets data being collected
One of the critical attributes of a distributed and makeshift system is to keep up with the system's full-cycle knowledge. Knowledge of the complete cycle of such distributed systems is rare among employees (Brodbeck et al., 2007). The parent company's decision for a new system in these markets was faced with mounting resistance from the subsidiaries. The failure of the initial roll-out success in these 18 markets was in agreement with the presence of subsidiaries' resistance (Bouquet & Birkinshaw, 2008). Gaur et al., 2017 presented the cultural conflict arising from the cultural differences and distance from the parent company. The parent company abandoning the system upgrade in these 18 markets, the cultural distance increased (Chen et al., 2009). In the absence of real-time reporting and monitoring, the subsidiaries operated more as decentralized units, and the de-facto culture grew roots. The data was collected after the standardized ERP was implemented in the subsidiaries where respondents work.