The Informal Organization of Korean Companies: Implications for Korean MNCs

Many Korean multinational corporations (MNCs) try to adapt locally by introducing hybrid international human resource management (IHRM); however, in‐depth case studies indicate a gap between espoused and actual IHRM. To resolve this challenge, and taking into account country‐of‐origin effects and institutional practices, we argue that Korean MNCs must become aware of the embeddedness of informal processes in Korean organizations. These informal organization processes complement paternalistic leadership and hierarchical communication, and without them the formal management systems of Korean MNCs are left with authoritarian centralized decision‐making processes where local employees may not feel able to participate. © 2014 Wiley Periodicals, Inc.