Abstract

Based on contingency and cultural theories, this study attempts to explore how organizational management style channeled through Taiwan’s headquarter and host culture affect the management control systems (MCSs) of foreign operations. Empirically, it draws on comparative case study approach to examine four Taiwanese IT firms. Our research findings show that, management style from headquarter had a significant effect on the organizational and evaluation processes of MCSs of European operation; reward process was deeply influenced by host culture; and planning process was interactively influenced by both. We also find that those case firms focusing on financial control had more uniform MCSs between Taiwanese and European operations than those focusing on strategic management. The results also show expatriate managers-especially with long-term assignment-had significant impact on planning, organization and evaluation processes of MCSs involving European operations.