The configurations of HRM bundles in MNCs by their contributions to subsidiaries’ performance and cultural dimensions

Abstract

The main goal of the paper is to determine whether the HQs of MNCs evaluate the significances of particular HRM subfunctions to their foreign subsidiaries’ performance differently depending on a specific cultural context and—as a consequence—various configurations of HRM subfunctions may be identified in different cultural contexts. The theoretical assumptions are based on a combination of the configurational and contextual perspectives through a cross-cultural lens. In the empirical research an abductive reasoning process is applied. The research sample covers 200 headquarters of MNCs. To analyze the collected data both descriptive and correlational statistical methods are used. Two patterns of configurational bundle of HRM have been identified: A and B. Pattern A tends to be more system oriented and Pattern B more centralization oriented. Pattern A covers the subsidiaries which, with comparison to their HQ, are of lower power distance, higher individualism, higher masculinity, lower uncertainty avoidance, longer time orientation, and higher indulgence. Pattern B is composed of the subsidiaries with the opposite signs of the cultural distance index. The originality of the study consists in the application of the abductive research model. Thanks to it, we were able to search and find the simplest and most probable explanations for our observations. And the value of the research itself lies in the evidence that the contextual perspective with its configurational implications in the HRM research field is useful in identifying the phenomena that are difficult to identify or unidentifiable otherwise. The findings of the present study provide some knowledge on how cultural distance (external variable) and the significance of HRM to the subsidiary’s performance results (internal variable) interact in impacting on different configurational bundles of HRM subfunctions, their centralization practices and knowledge flows in MNCs.