A Study on Multinational Company’s Management Control and Coordination Mechanism towards Subsidiaries in Kulim Industrial Area

• Main Authors: Gopalan, Sanggetha, Kaliappen, Narentheren
• Format: Conference or Workshop Item
• Language: English
• Published: 2023
• Subjects: HF Commerce
• Online Access: https://repo.uum.edu.my/id/eprint/30602/1/8th%20ICSC%202023%2078-92.pdf; https://repo.uum.edu.my/id/eprint/30602/
• Institution: Universiti Utara Malaysia

This research investigates the effects of three types of controls, namely bureaucratic control, output control, and cultural control, and the coordination mechanism of multinational companies towards their subsidiaries in the Kulim industrial area. The study adopts a quantitative approach, focusing on management staff level as respondents, who were selected from foreign subsidiaries in the Kulim industrial area using judgmental sampling. The data was analysed by using SPSS version 27. The findings revealed significant correlations among the three types of controls (bureaucratic control, output control, and cultural control) concerning their impact on the control and coordination mechanism. However, the study acknowledges limitations in exclusively focusing on these three independent variables (bureaucratic control, output control, and cultural control) to represent subsidiaries of foreign headquarters located in Kulim industrial area. The study's contribution lies in providing valuable knowledge to organizations and managers, emphasizing the significance of control and coordination mechanisms. Furthermore, it offers insights for future researchers to understand the positive and negative effects of different types of controls on the overall control and coordination mechanism. Specifically, the variables of control and coordination mechanism demonstrate a positive relationship with bureaucratic control and cultural control, while output control shows a negative impact on the coordination between headquarters and subsidiaries.