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BUS 432 Study Guide - Midterm Guide: Human Resource Management, Organizational Culture, Internal Consistency

Business Administration
Course Code
BUS 432
Dave Thomas
Study Guide

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Chapter 4: HRM Across Boundaries
Primary motivation for transfer of HR practices
Market Motive
Refers to the idea that the transfer of practices is seen as a means to enhance the
efficiency of the organization by sharing best practices throughout the
Based on the idea that organizations need to develop integrated network of
subunits that share expertise and knowledge with each other in order to survive
in an international competitive environment
Cultural Motives
Involve the influence that national culture has on the MNE by encouraging it to
take aspects of the national culture with it as it expands internationally.
Based on the idea that organizational culture is influenced by national culture
and this explains a desire to implement home country practices in terms of
organizational replication
Political Motives
Involve any number of organizational actors, who in order to advance their own
interest for taking legitimacy initiate the transfer of practices.
Managers throughout the organization may wish to engage in sharing practice to
enhance their legitimacy as a good corporate citizen
The ability to transfer practices involve both characteristic of organization and the
environment in which it is operating
Country of origin -> standardization
o MNEs are often influenced by the way bsn is done in the country in which
org originated
Large orgs sometimes dominated by practices of country of origin
If senior mgmt. is made up of teams from parent country more
country of origin effects
As firm internationalizes country of origin diminished

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More expats = more country of origin effects because they transfer
practices from home
Dominance effects -> standardization
o High degree of convergence towards a dominant best practices model
o Social dominance is the idea that within every complex society certain
groups are dominant over others and thus enjoy disproportional amount of
o Hierarchy of practices based on groups status countries high in hierarchy
will have practices that are likely to dominate
o Dominance effect is more important in determining local subsidiary HRM
Strategic human resource management orientation (SIHRM)
o A determinant of the level of HRM practices transfer is the extent to which
the org sees its HRM practices as a source of competitive advantage
Can take on 3 general approaches to the design of HRM systems
used in its overseas affiliates:
Adaptive - create HRM systems for foreign affiliates that reflect
the local environment, belief that HR competence is location
specific. Expect to see little to no transfer of practices from
parent to affiliate low internal consistency
o Multinational strategy
Explorative - the parent firms HRM practices are transferred to
foreign affiliate replicating home country HRM practices
o High Internal consistency, belied that HRM competence is
generalizable across locations
o Global strategy
Integrative combined overseas and parent HRM system
o Belief that practices can be adapted to fit in more than
one context
o Consistent with transnational strategy
Host country effects
o Both the level and type of practice is transferred are influence by the
institutional and cultural factors in the local context.
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