The moderating effect of local environment on a foreign affiliate's global IS strategy-effectiveness relationship

Abstract

This study evaluates the moderating effects of local culture, local regulation, and local competition on a global information systems (GISs) strategy-effectiveness relationship. Cluster analyses and moderated regression analyses were used to test hypotheses in a sample of 312 foreign affiliates operating in Canada, Japan, the UK and the United States. Our findings suggested that GIS strategy was related to information systems (IS) effectiveness. This relationship was moderated by all three selected moderator variables. Our study also found that foreign affiliates that follow a globally integrative GIS strategy, but which operate in a more restrictive local environment, eventually achieve greater IS effectiveness. In addition, foreign affiliates that follow a locally responsive GIS strategy, but which operate in a more competitive and culturally different local environment, will also be able to run their IS more effectively.

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