Management control in international joint ventures as self organising systems
- Publication Type:
- Thesis
- Issue Date:
- 2002
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The need for more dynamic views on international joint ventures' control research
has recently become a growing concern. Changes in the complexity of relationships
between organisations and their environments have led to an increase in control
problems and to a need to investigate a suitable framework of management control.
The concept of self-organising systems that has emerged with the science of
complexity produces some useful and interesting new ways to examine the behaviour
of complex systems. Therefore, extending the recent development in self-organising
systems into international joint ventures' control research is an opportunity to
explore new insights into the development of joint ventures. This study takes an
integrative approach by focusing on the integration of management control and self-organising
properties of international joint ventures. The purpose of this study is to
investigate the roles of management control systems in affecting international joint
ventures' performance, from the perspective of alliance complexity constraints. A
model of management control in international joint ventures as self-organising
systems, representing a complexity-control-outcomes framework, is developed and
tested empirically using the partial least square (FLS) approach, a distinctive
structural equation modeling (SEM) based technique.
The primary results of this study show that formal control mechanisms and control
extent have significant direct effects on management automony and the international
joint ventures' performance. Management autonomy as an intervening endogenous
construct has a significant direct effect on the international joint ventures
performance. Significant direct effects of organisational complexity on the formal
control mechanisms and control extent are found, and a significant indirect effect of
organisational complexity on the management autonomy is found. The overall results
suggest a sound link between the complexity-control framework with the control-outcome
framework, and the achievement of fit between these two frameworks is
important for superior international joint ventures' performance.
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