The Role of Corporate HR Functions In Multinational Corporations: The Interplay Between Corporate, Regional/National And Plant Level

The HR literature has been abundant in providing typologies of the roles of HR professionals in their organisation. These typologies are largely related to the changing nature of HRM over time, and the context in which empirical work was carried out. In this paper we focus on the context of the increasing internationalisation of firms and how this has an effect upon modern-day typologies of HR roles. We explore these roles by focusing on the way in which HRM practices come about. Especially in a MNC setting of increasing internationalisation of firms the issues of coordination, shared learning and standardisation versus leeway for adapting to the local context (customisation) are prominent. These issues present themselves both at the corporate and regional level and at the national and local (plant) level. On all these levels HR practitioners are active and find themselves amidst the interplay of both (de-)centralisation and standardisation versus customisation processes. This paper thus explores the way in which HR practices come into being and how they are implemented and coordinated. These insights help us understand further the roles of international corporate HR functions that are being identified. Our data is based on 65 interviews, which were held (as part of larger study of HR-function excellence) with HR managers, line managers and senior executives of six multinational companies in eight countries from September to December 2004. This data reveals new classifications of processes by which HR activities are developed, implemented and coordinated, both in terms of who is involved and how these processes are carried out

Does knowledge sharing pay? A multinational subsidiary perspective on knowledge outflows

Empirical studies on the impact of knowledge management on the performance of MNC subsidiaries remain elusive to date. This study examines the effect of knowledge management tools on absorptive capacity and firm performance with unique data from subsidiary units in a large German MNC – HeidelbergCement. The findings suggest that knowledge management tools unfold their performance impact through their significant influence on absorptive capacity and knowledge inflows. The key contributions to the current literature on knowledge flows in the MNC include an empirically corroborated link between deployments of knowledge management tools and their impact on the subsidiary employee’s ability and motivation to learn from internal knowledge flows in the MNC as well as their impact on subsidiary business performance

Ethics and taxation : a cross-national comparison of UK and Turkish firms

This paper investigates responses to tax related ethical issues facing busines

How Does Knowledge Transfer from Foreign Subsidiaries Affect Parent Companies' Innovative Capacity

The paper addresses reverse knowledge transfer (RKT) from foreign subsidiary to parent company. Specifically, it aims at investigating to what extent the effectiveness of such a transfer is influenced by: (i) the organizational mechanisms employed for transferring knowledge; (ii) the subsidiary’s role, its autonomy, and its relationships with the local context. The empirical analysis considers 162 transfers of best practices possessed by foreign subsidiaries and transferred back to their Italian parent companies. Results confirm that the impact of RKT on the parent company’s innovativeness is greater when: (i) person-based mechanisms are employed for transferring knowledge; (ii) subsidiaries are competence-creating; and (iii) knowledge developed by subsidiaries benefits from local external linkages.External linkages; organizational mechanisms; parent company's innovativeness; reverse knowledge transfer, subsidiary’s characteristics

The Role of Corporate HR Funcitons in MNCs: The Interplay Between Corporate, Regional/National and Plant Level

The HR literature has been abundant in providing typologies of the roles of HR professionals in their organisation. These typologies are largely related to the changing nature of HRM over time, and the context in which empirical work was carried out. In this paper we focus on the context of the increasing internationalisation of firms and how this has an effect upon modern-day typologies of HR roles. We explore these roles by focusing on the way in which HRM practices come about. Especially in a MNC setting of increasing internationalisation of firms the issues of coordination, shared learning and standardisation versus leeway for adapting to the local context (customisation) are prominent. These issues present themselves both at the corporate and regional level and at the national and local (plant) level. On all these levels HR practitioners are active and find themselves amidst the interplay of both (de-)centralisation and standardisation versus customisation processes. This paper thus explores the way in which HR practices come into being and how they are implemented and coordinated. These insights help us understand further the roles of international corporate HR functions that are being identified. Our data is based on 65 interviews, which were held (as part of larger study of HR-function excellence) with HR managers, line managers and senior executives of six multinational companies in eight countries from September to December 2004. This data reveals new classifications of processes by which HR activities are developed, implemented and coordinated, both in terms of who is involved and how these processes are carried out

Autonomy and Performance of Foreign Subsidiaries in five Transition Countries

The paper analyses the link between the autonomy according to business function and the performance of foreign subsidiaries in Slovenia, Poland, Hungary, Slovakia and Estonia. The novelty of the paper is in the deeper investigation of the multidimensionality of autonomy. Using the method of principal components, four business function factors relating to autonomy were obtained (technology, marketing, management, finance). The results supported the argument that the relationship between autonomy and performance depends on the type of autonomy. Marketing and finance are the most powerful dimensions of autonomy. Higher autonomy in marketing is negatively linked with technology upgrading, measured by productivity level, improvement of technological level of production equipment, and quality of products. The higher the financial autonomy of the subsidiaries the bigger the positive changes in all fields of performance.http://deepblue.lib.umich.edu/bitstream/2027.42/40166/3/wp780.pd

Thinking locally: Exploring the importance of a subsidiary-centered model of FDI-related spillovers in Brazil

This paper investigates FDI-related spillovers in Brazil for the period 1996-2005. In contrast to most previous recent studies, which have failed to identify any significant effects in emerging economies, we found that horizontal spillovers did arise in Brazil. However, they did not arise simply as a consequence of general FDI-mediated technology transfer from MNC headquarters, as the standard approach presumes. Nor were they associated with expected inter-industry differences in technological intensity, or with differences in domestic firms’ absorptive capability. Instead, spillovers were associated with the existence of particular kinds of localized knowledge-creation activities undertaken by subsidiaries. We discuss the theory and policy implications that emerge from these results.FDI spillovers, subsidiaries, heterogeneity, localized innovation, Brazil, productivity, innovation

Trojan Horses or Local Allies: Host-country National Managers in Developing Market Subsidiaries

We investigate a multinational corporation's (MNC) decision to appoint host-country national (HCN) managers to foreign subsidiaries based on the institutional context of and familiarity with the host country. HCN managers are commonly associated with specialized knowledge, superior responsiveness, and higher legitimacy. Yet, we argue that local familiarity of HCNs can also be perceived as risky or harmful by MNC parents. We analyze how formal and informal institutions affect the trade-off between positive effects and potential costs associated with HCN managers ("Local allies" vs. "Trojan horses"). We find that legal institutions protect foreign MNCs from potential costs, encourage the use of HCNs and reinforce their benefits. Corruption and corruption distance, however, increase perceived costs associated with HCN managers up to a point at which they outweigh their perceived benefits

Multinationals and subsidiaries: A bibliometric study on Ghoshal?s managing across borders

Some scholars? imprint an academic discipline by their contribution to the manner in which we think and research, namely by putting forward novel concepts and insights. In this paper we examine the impact of Sumantra Ghoshal?s work on the study of subsidiaries and multinational enterprises and organizational formats for foreign operations. Specifically we perform a bibliometric study focused on Bartlett and Ghoshal?s well-known book ?Managing across borders: The transnational solution? to assess its impact in international business (IB) research. We examine the entire record of publications in the top leading IB journal: Journal of International Business Studies (JIBS). Theoretically supported, Ghoshal?s work was keenly influenced by his corporate experiences and his constant questioning of the dominant theories and assumptions. Our analyses show the impact of the work on the ?transnational solution? namely on the understanding of multinationals and subsidiaries, thus being one of the most notable contributions for IB research over the past twenty years.Sumantra Ghoshal, international business research, bibliometric study, transnational solution, multinational corporations, subsidiaries

A New Nexus Between Foreign Direct Investment, Industrial and Innovation Policies

This paper deals with the interplay between foreign direct investment (FDI) and the industrial and innovation policies of host developing economies. It aims to redefine the nexus between these different, though yet strongly interconnected policy areas, by bringing the affiliates of multinational corporations already established in a host economy to the first level of analysis. It argues that host country governments should concentrate on enhancing innovativeness and development of existing foreign-owned affiliates, instead of striving to attract higher volumes of FDI inflows.Foreign Direct Investment, FDI, Foreign-owned Affiliates, Industrial Policy, Innovation Policy