  Raynaud and Gruson developed the theory of blowing-up an algebraic variety
$X$ along a coherent sheaf $M$ in the sense that there exists a blow-up $X'$ of
$X$ such that the "strict transform" of $M$ is flat over $X'$ and the blow-up
satisfies an universal (minimality) property. However, not much is known about
the singularities of the blow-up. In this article, we prove that if $X$ is a
normal surface singularity and $M$ is a reflexive $\mathcal{O}_{X}$-module,
then such a blow-up arises naturally from the theory of McKay correspondence.
We show that the normalization of the blow-up of Raynaud and Gruson is obtained
by a resolution of $X$ such that the full sheaf $\mathcal{M}$ associated to $M$
(i.e., the reflexive hull of the pull-back of $M$) is globally generated and
then contracting all the components of the exceptional divisor not intersecting
the first Chern class of $\mathcal{M}$. Moreover, we prove that if $X$ is
Gorenstein and $M$ is special in the sense of Wunram and Riemenschneider
(generalized in a previous work by Bobadilla and the author), then the blow-up
of Raynaud and Gruson is normal. Finally, we use the theory of matrix
factorization developed by Eisenbud, to give concrete examples of such
blow-ups.
