Research On The Impact Of Subsidiary Roles On Mode Of Management Control In Group

Under the background of high speed development of market economy in our country, the collectivization gradually becomes the current mainstream of the type of enterprise. However, the connection among enterprises may not only produce great synergies through collaborative interaction and resource sharing, but also bring a series of conflicts due to the allocation of resources and market development. In particular, during enterprise rapidly change and even blindly follow, enterprise gigantism gradually highlights. The problem of internal control in group is not the power disposition of corporate governance in the individual companies, but the balance of power between the group and the subordinate enterprises. As a result, the internal control as a traditional control method has been more difficult to explain the parent-subsidiary management inefficiency. How to select effective management control mode based on the characteristics of parent-subsidiary relationship in group has been a difficult problem in the group management.On the basis of the review and analysis of the existing researches, a subsidiary-role model and the theoretical research framework have been built. Through analyzing the unit of four different-role’s of wholly-owned subsidiary attached to the electric power group by the multi-case study method, different control modes in the group are measured from the point of view of the degree of distribution of power in strategy, investment, finance, personnel, production, marketing management functions between the group and the subordinate enterprises. The conclusion shows that subsidiary roles on mode mainly affect the management control in group. The subsidiary roles would be represented by strategic importance and internal normalization, and as a result, subsidiary roles can be divided into four types including main subsidiary, emerging subsidiary, contributing subsidiary and exploiting subsidiary, which are adapt to strategy, operation, finance, strategy modes of management control, respectively. Furthermore, the conclusion shows that strategic importance and internal normalization have different impacts on the mode of management control in group, and strategic importance drives the group to act centralized management and control on subsidiary.Based on the subsidiary-role theoretical framework in multinational companies, from the characteristics of domestic group, strategic importance and internal normalization interpret the connotation of subsidiary role. Furthermore, from the perspective of the subsidiary role, based on the group power configuration, the research has explained the differentiation phenomenon of group’s internal control models and put forwarded the fit model of subsidiary role and the group’s internal control models. It provides the diversified development with the target control basis in group.