Human resource management and industrial relations in multinational corporations in and from China: Challenges and new insights

The purpose of this article is to provide an overview on the state of research in the field in human resource management (HRM) issues in multinational corporations (MNCs) in and from China. We integrate previous studies from multiple disciplines to articulate the contextual importance of research on this topic, and suggest overarching themes to expand the field of research. HRM research in the intercultural, interinstitutional context of MNCs in and from China has the potential to provide contextualized insights for longstanding debates in the field such as HRM standardization versus localization and convergence versus divergence and contextual factors behind these patterns. To this end, we call for future research to center on the changing cultural, institutional, technological, and globalization context in understanding HRM and industrial relations issues in these MNCs. Practically, knowledge in this area can help global managers and top management teams in multinational organizations navigate various context complexity, foster more productive coordination and cooperation across borders, and gain legitimacy and MNCs in and from China additional competitive edge in the global marketplace.     

Subsidiary staffing,cultural friction,and subsidiary performance: Evidence from Korean subsidiaries in 63 countries

Drawing from the notion of cultural friction and based on the agency theory rationalization of multinational enterprise (MNE) headquarter–subsidiary relationship, we examine the impact of cultural friction in foreign subsidiaries on subsidiary performance. We argue that cultural friction, arising due to a high presence of parent country nationals (PCNs) in culturally distant locations, has a detrimental effect on subsidiary performance. This effect is the strongest when the cultural friction is at the top management team (TMT) level and the weakest when friction is at the regular employee level. However, this relationship is contingent on factors that work as drags or lubricants for cultural friction between PCNs and host country nationals (HCNs). We identify governance mode and language differences between home and host countries as drag parameters and host country experience and subsidiary interdependence as lubricants that condition the effect of cultural friction on subsidiary performance. Empirical findings based on a longitudinal sample of 7,495 foreign subsidiary observations of 467 Korean MNEs in 63 countries during 1990–2014 provide robust support for our theoretical predictions.     

Human resource management,strategic involvement and e-HRM technology

Associated with the emergence of internet-based human resource management technology is rhetoric predicting that such technological advances (electronic human resource management technology or e-HRM) will make HRM in organizations more strategic. Yet such a prediction is contested in the literature on the role of technology in organizations. Using a large survey data-set consisting of 5665 companies that are located in 32 different countries, we use non-recursive simultaneous equation models with instrumental variables to empirically evaluate competing theoretical perspectives in this literature. We find and show that strategic HR involvement and greater e-HRM capability are both directly and reciprocally related supporting both theoretical perspectives but also showing each is not mutually exclusive. We discuss the implication of these results for human resource management theory, practice and future research.     

Human resource function strategic role and trade unions: exploring their impact on human resource management practices in Uruguayan firms

Organizations worldwide are confronted with different contextual constraints. Jackson and Schuler [1995, ‘Understanding Human Resource Management in the Context of Organizations and their Environments,' Annual Review of Psychology, 46, 237–264], in their classical review, highlight the importance of the impact of the internal and external organizational context on human resource management (HRM) practices. This paper uses data collected through a survey of firms located in Uruguay, in a context where HR function and trade unions have gone through significant changes, to determine their impact on the adoption of different HRM practices. The authors find that organizations with an HR function strategically involved and with higher degree of union presence have more person-centred HRM practices, while performance-centred HRM practices were positively influenced by HR function strategic role. However, the findings do not support the moderating role of trade union presence on the relationship between the HR function strategic role and HRM practices.     

Introduction: globalizing international human resource management

In this Introduction, we have sought to explain the rationales in putting together a ‘Special Issue’ on Globalizing International Human Resource Management (IHRM). These include, first, coverage of as wide a range of regional and national cultures as possible; second, presentation of as wide a set as perspectives as possible; and last, discussion of how these may shape both theory and practice in the field.     

Human resource practices and firm performance of multinational corporations: influences of country origin

Drawing from a cultural values perspective, we investigate the effects of country origins on HR (human resource) practices of firms from the United States, Great Britain, Japan and Hong Kong operating in Hong Kong. In general, results supported hypothesized differences in HR practices of firms from different countries. In addition, results indicated that HR practices, specifically structural training and development and retention-oriented compensation, were related to various measures of firm performance. Of further interest was the finding that country origin moderated relationships of HR practices with firm performance; in general, relationships of structural training and development and retention-oriented compensation were stronger for Hong Kong firms. Implications of the results are discussed.     

An investigation of paradigm choice in Australian international human resource management research

This paper addresses the question of whether Australian international human resource management (IHRM) research is dominated by either a universalist or contextualist paradigm. Using a systematic review approach, 82 peer reviewed papers were analysed using a basic extraction tool to record publication and research design details. The universalist/contextualist distinction decision was based on the point at which theory became evident in each publication. Results indicated an almost even split in the universalist/contextualist paradigm choice suggesting a balanced rather than dominant research preference. This finding may reflect the impact of both European and North American influences in Australian IHRM research. A second finding is a high level of papers without proposed theoretical relationships: this second finding has a number of ramifications for IHRM research and practice in Australia.     

Theoretical implications from the case of performance-based human resource management practices in Japan: management fashion,institutionalization and strategic human resource management perspectives

In Japan, a new type of human resource management (HRM) practices called ‘performance-based HRM practices’ (seika-shugi in Japanese) emerged in the 1990s, and has been adopted by many Japanese firms. In this paper, I illustrate how these type of practices emerged as a management fashion, diffused across a large number of Japanese firms, and became institutionalized in the Japanese business context; and discuss the relationship between performance-based HRM practices and firm performance. This illustration is used to develop a theoretical framework to better understand the relationship between HRM practices and firm performance by integrating theories of management fashions, institutionalization and strategic HRM. Suggestions for future research are also discussed.     

Extending strategic international human resource management research and pedagogy to the non-profit multinational

This article calls for the inclusion of multinational non-profit organizations in the research and pedagogy of strategic international human resource management. Multinational non-profit enterprise is increasingly influential, both economically and philosophically, as economic and socio-cultural boundaries become more interdependent. Yet the multinational non-profit sector has been ignored by international human resource management scholars. When research and pedagogy overlook practice, a concern exists with regard to their relevance. By outlining the international development of multinational non-profit enterprise, the article contextualizes strategic international human resource management in multinational intermediate private aid and development agencies. Analysis of a particular example, World Vision Australia, illustrates the discussion.     

Towards a hybrid model? A systematic review of human resource management research on Chinese state-owned enterprises (1993–2017)

Abstract

Over the past two decades, there has been a proliferation of research on human resource management (HRM) in Chinese state-owned enterprises (SOEs) as a result of the wide-reaching state-sector reform of the late 1980s. This article aims to provide a systematic review of literature on this topic and capture the nature of HRM in Chinese SOEs, both in research and practice. The article draws on 178 studies from 43 English academic journals over a period of 25?years (1993–2017). In analysing this literature and by taking stock of theoretical frameworks, research methods, themes and analysis of academic articles in this area, we have gained a number of insights. The study has found that the research methods used have shifted from qualitative and interpretive methodology toward quantitative and sophisticated modelling. A further insight is that there has been a relatively heavy reliance on institutional theory in the earlier studies reviewed, and since then a switch towards organizational behaviour perspectives. The level of analysis has moved from macro to micro level and thematic foci have become more diverse and complex. We highlight a number of avenues, theoretical and empirical, for future studies in this field.     

Hybridization: striking a balance between adoption and adaptation of human resource management practices in French multinational corporations and their Tunisian subsidiaries

International management research has tended to approach the transfer of human resource management (HRM) practices by examining the one-way transfer from parent companies to their subsidiaries, their adaptation to the subsidiaries’ local context and, more recently, the reverse transfer of HRM practices from subsidiaries to their headquarters. This article aims to analyse the transfer of HRM practices from headquarters to their foreign subsidiaries through the process of hybridization. Although numerous studies focus on the transfer of HRM practices between economically developed countries or from these countries to transitional economies, few have considered French multinational corporations (MNCs) operating in ex-colonized countries. This paper addresses the ways in which the HRM hybridization process is implemented in two French subsidiaries operating in Tunisia. It focuses on the dual perspectives of managerial staff at headquarters and subsidiaries as well as shop floor employees in the subsidiaries. A range of HRM practices (recruitment and selection, compensation, performance appraisal and career management) is analysed from their transfer to their reinterpretation. The results show the importance of the concept of hybridization on HRM practice transfer through a multi-level analysis of the strategies used by various stakeholders during the hybridization process. The paper also provides useful insights into the factors of hybridization that may foster or inhibit the transfer and adoption of HRM practices by foreign subsidiaries. These include the relational context, the type of practices transferred, the interests of different professional categories and their social interactions. Based on these factors, several hybridizations are identified. The study points out the specificity of the Tunisian context and shows that institutional factors have less influence on the transfer of HRM practices in ex-colonized countries than cultural factors that have a transversal influence on different HRM practices. Key cultural factors constraining the transfer include emotional relationships and interpersonal trust. Moreover, the international transfer of HRM practices from MNCs to ex-colonized transitional countries requires taking into account the post-colonialism and fascination effects.     

Environmental dynamism,human resource flexibility,and firm performance: analysis of a multi-level causal model

While strategic HRM scholars have conceptualized HR flexibility as an important source of sustainable superior firm performance in dynamic environments, the process through which HR flexibility creates value for the firm has not been empirically investigated. Based on a study of 98 manufacturing and 103 service firms from a wide array of industries in India, this paper attempts to illuminate the black box of causal linkages between environmental dynamism, flexibility of human assets, and firm level human-, operational-, and financial-outcomes by developing and testing a multi-level causal model. Evidence indicates that HR flexibility mediates the influence of environmental dynamism on firm performance and that irrespective of the nature of the industry and the degree of environmental turbulence, superior firm performance ensues when HR flexibility as actually possessed by the firm matches the environmental demands for such flexibility as perceived by the firm managers. The results also support the notion of HR value chain that postulates that HR system has direct impact on firm-level HR outcomes which are most proximal, and its effects on increasingly more distal operational- and financial-outcomes are mediated by HR outcomes. The findings of the study suggest that HR practices as a system have both direct and indirect (mediated by behavioral flexibility) effects on firm-level HR outcomes. Existence of significant direct effects signifies that HR practices play an important role as a structural mechanism in achieving superior firm performance.     

Standardize or Customize: The Interactive Effects of HRM and Environment Uncertainty on MNC Subsidiary Performance

This study examines the impact of customizing (as opposed to standardizing) human resource management (HRM) practices on subsidiary performance in multinational corporations (MNCs). We examine how this relationship is influenced by environmental uncertainty. Hypotheses were tested using data from 92 subsidiaries of a large MNC operating in 27 countries. The results showed an interactive relationship between the customization of HRM practices and subsidiary environmental uncertainty on both financial (net profit) and nonfinancial (customer satisfaction) objective measures of subsidiary performance. The results of this study provide important empirical insights for researchers and practitioners into how HRM can be best configured to drive multiple performance outcomes for MNC subsidiaries. © 2014 Wiley Periodicals, Inc.     

Antecedents and consequences of dimensions of human resource management practices in Vietnam

The purpose of this study is to extend the empirical research concerning the impact of human resource management (HRM) practices on organizational effectiveness into the context of developing and transitional economy countries. From a survey of 137 cross-sector companies, it was discovered that there are five dimensions of HRM practices currently in use in Vietnam. Variation in the application of these dimensions can be partly traced to several organizational characteristics, but most salient is the perception of management on the value of human resources. In some dimensions, this variation constitutes a source of the difference in the perceptual company performance. These findings break new ground to propose a process for implementing HRM practices in Vietnam.     

A typology of international human resource management in Japanese multinational corporations: Organizational implications

This article outlines a typology of approaches to the design of international human resource management (HRM) systems in multinational corporations based on a ten-year study of Japanese affiliates in the United States, Europe, and Asia. After outlining four different approaches based on the dimensions of parent company imprint, problem attribution, and diffusion of HRM innovations, the article discusses the implications for organizations in the areas of flexibility, organizational learning, integration and coordination, and cost. © 1998 John Wiley & Sons, Inc.     

High-investment HR values and firm performance among local firms and U.S. MNCs’ subsidiaries in South Asia: a comparative study

Grounded in institutional theory, this study investigates the differential adoption and internalization of high-investment human resource (HR) values by local companies and by subsidiaries of US firms located throughout South Asia; and the impact of these HR values on firms’ performance. In line with our predictions, results suggest that US subsidiaries have a greater rate of adoption of high-investment HR values compared to local South Asian firms. Contrary to our predictions, however, both types of firms are similar in the level of internalization of their respective HR values. Finally, while greater levels of high-investment HR value adoption is associated with firm performance across the board, this relationship tends to be stronger for US MNCs’ subsidiaries compared to local South Asian companies. Theoretical and practical implications for the transfer and diffusion of high-investment HR values in institutionally and culturally distant contexts are discussed.     

Interference among conflicting institutions and technical-economic conditions: the adoption of the Assessment Center in French,German, Italian,UK, and US multinational firms

We analyze the adoption of the Assessment Center (AC), one of the most complex human resource management techniques, in 161 British, French, German, Italian and US multinational firms both at the headquarters and in their Italian subsidiaries. Combining both quantitative analysis and qualitative accounts, we investigate how different and partially contradictory institutional influences stemming from national business systems and professions, global corporate networks and professions, and different technical-economic conditions affect the adoption of the AC. Our study shows that AC-diffusion is similar at headquarters level in all national contexts, testifying to the paramount importance of transnational institutions of Anglo-American origin for MNCs of any nationality, despite great local variation in the degree of institutionalization of the AC, which ranges from fully-fledged support in culture and the professions as, for example, in Germany, the UK and the USA, to weak or negative backing as in France and Italy. However, the study also reveals how different characteristics of the corporate field of firms with headquarters in different countries, as well as organizational size and labor market conditions, still explain adoption of the AC in their subsidiaries in Italy.     

Human resource management – a national business system perspective

Abstract

Although a sizeable body of academic literature has attempted to explain the role of national business systems in the context of human resource management (HRM), there is still little research on the extent to which institutional features explain patterns of HRM in the emerging economy of Dubai. Different institutional settings tend to generate their own organisational arrangements to manage their employees, and it is important to understand how this interplay works. From an economic perspective, Dubai is important, mainly due to its promising diversification of its economy and its political stability. From a national business system perspective, the institutional environment represents a peculiar case, because it differs from many other emerging markets with respect to the strong co-ordinating role of the state, the strong segmentation and specialisation of tasks, roles, skills and authority, especially between nationals and expatriates, and a unique employment system. Thirty-two in-depth interviews with HR managers, and extensive document reviews, reveal that these elements of the institutional environment are related strongly to specific patterns of HRM practices, including distinctive policies for national employees and expatriates. The insights generated in this study explain the particularities of HRM in Dubai from a national business system perspective.     

Human resource management in Chinese multinationals in the United Kingdom: The interplay of institutions,culture, and strategic choice

This is a study of the challenges faced by Chinese expatriate managers and their strategic responses in securing a workable degree of alignment in UK subsidiaries, against a backdrop of competing home‐country and host‐country pressures. Although much of the literature on home‐country and host‐country effects tends to either adopt a culture or an institutional approach, this study highlights the intermeshed nature of the two. In locating cultural dynamics within an institutional firmament, this study juxtaposes the effects of each and draws conclusions as to their intersection. It is founded on in‐depth interviews with home‐country and host‐country managers. The findings suggest, on the one hand, Chinese expatriate managers tended to see local regulations as an obstacle to efficiency, rather than as a means to access context‐specific complementarities. On the other hand, these managers recognized the need to fit in with established locally specific ways of doing things and in securing sufficient staff buy in to sustain operations, and played a key intermediary role between headquarters and subsidiary.