The mediating effect of organizational culture and knowledge sharing on transformational leadership and Enterprise Resource Planning systems success: An empirical study in China

Abstract

Senior leadership has been identified as a critical factor in fostering Enterprise Resource Planning (ERP) systems success, however, the specific impact mechanism of transformational leadership on ERP success is still largely unknown. Based on organizational culture theory and knowledge based view, this study developed a theoretical model to explore the mediating effect of organizational culture and knowledge sharing on transformational leadership and ERP success. Data was collected from 115 IS executives and 413 ERP end users in 115 organizations in China. Partial Least Squares (PLS) analysis results suggest that transformational leadership is directly related with all the four types of organizational culture – development culture, group culture, hierarchical culture and rational culture, and is indirectly related with knowledge sharing and ERP success. Specifically, development culture has direct impact on ERP success, while hierarchical culture, group and rational culture are indirectly related with ERP success, mediated by explicit and tacit knowledge sharing. The research findings can provide guidelines for the top executives to facilitate appropriate organizational culture, so as to foster ERP knowledge sharing and achieve business benefits with the assimilation of ERP systems.