| Abstract | The transfer of human resource policies and practices from headquarters to
subsidiary locations becomes increasingly important in multinational enterprises as
they develop from being exporting organisations to having stand-alone country
subsidiaries, as a step towards the globalisation of their operations. The ability to
transfer knowledge effectively across borders is a key characteristic of successful
multinational enterprises. International human resource managers need to keep
informed about the pressures of globalisation on their businesses and study local
human resource issues relevant to their firms' operations. This study attempts to
bridge the fields of international human resource management and strategic
management, by investigating how German multinational enterprises transfer human
resource policies and practices to their subsidiaries in Singapore, Thailand and
Indonesia. While western multinational enterprises operating in Asian countries face
different human resource issues from those in their home countries, existing research
has a strong focus on Anglo-Saxon experiences, which results in a lack of studies of
European and specifically, German multinationals. This study focuses on a sample of
German multinational enterprises and the internationalisation of their human
resource function.
Against this background, the research question is 'How do German multinational
companies transfer human resource policies and practices to and from their
subsidiaries in South East Asia?' The themes to be investigated emerge from the
fields of international human resource management; national, cultural and legal
differences in human resource management in selected enterprises between
Germany, Singapore, Thailand and Indonesia, and the impact of the headquarters
policies and practices of these multinational enterprises on human resource issues in
their subsidiaries.
The study investigates a number of research issues. The first is the international
human resource management approach of German multinational enterprises'
headquarters towards their subsidiaries. A second research issue deals with the key
cultural, legal and societal differences that influence the transfer of human resource
policies and practices. A third research issue analyses whether there is a general
climate of innovation and trust between headquarters and subsidiaries that facilitates
organisational change. A fourth research issue investigates how specific policies and
practices could change when applied in different countries. Finally, the roles of
headquarters people and subsidiary staff in the transfer process are studied.
This exploratory study uses qualitative methodology and is based on the analysis of
case studies. The three main cases are German Fortune Global 500 industrial
companies from different industries, namely electrical, mechanical and chemical, and
with subsidiaries in Singapore, Thailand and Indonesia. Prior theory in the literature
review and exploratory expert and pilot interviews led to the development of a
detailed interview protocol. A total of 24 in-depth interviews with human resource
directors and line managers form the backbone of data collection.
New contributions to the body of knowledge concern the incongruence between the
internationalisation of the business versus the human resource function, the link
between knowledge management and the human resource field, and the significance
of attitudinal relationships in the transfer process. Finally, cultural differences among
the transfer coalition are found to have a more significant impact on the transfer than
cultural differences of the respective workforces.
The contributions to management practice include five recommendations for
practitioners. These revolve around increasing the international experience of the
local human resource director to address the mismatch between the ever expanding
role of the local human resource director and the required, but presently lacking,
international profile to fulfil that role. For the organisation of the human resource
function in headquarters, assigning a mentor to a country or region and providing
more practical guidance, rather than policies, are examples of recommendations.
In brief, this study attempts to explain why German companies may experience
problems when they transfer human resource policies and practices to their
subsidiaries in Singapore, Thailand and Indonesia. In addition to being of interest
academically, the results of this study might assist managers of multinational
enterprises in designing better and more transferable international human resource
management policies and practices. Contributions are made concerning the feedback
routes from subsidiaries to headquarters, and finally, about the organisation of human
resource management. |
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| Keywords | human resource management, multinational companies, policies, practices, transfer, Germany, Singapore, Thailand, Indonesia |
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