The contested space of multinationals: Varieties of institutionalism, varieties of capitalism

Abstract

The article argues that institutionalist theory applied to multinationals focuses on the issue of ‘institutional duality’, that is, that within multinationals, actors are pressured to conform to the expectations of their home context whilst also being subjected to the transfer of practices from the home context of the MNC itself. This institutional duality leads to conflicts that can be labelled as forms of ‘micro-politics’. The head office managers transfer practices, people and resources to subsidiaries in order to maintain control and achieve their objectives. Local subsidiaries have differential capacities to resist these transfers or to develop them in their own interests depending on their institutional context. The article distinguishes institutional contexts that produce ‘Boy Scout’ subsidiaries, doing what they are told and consequently allowing locally distinctive capabilities to be undermined and those that produce ‘subversive strategists’ which look to deepen their connection with the local context not the MNC itself. These processes are exacerbated by the demands of capital markets which impose performance requirements on MNCs and lead to continuous organizational restructuring. Head offices become stronger in their attempts to impose standards in all their subsidiaries. The consequences of these processes are that except for a few pockets of ‘subversive strategists’, multinationals produce subsidiary ‘clones’ with little ability to leverage the specific assets which the institutional context provides. As it is the subversive strategists that are best placed to be innovative, the problem for the MNC is how to manage this tension.

What do we know about cross-country comparative studies in HRM? A critical review of literature in the period of 2000-2014

“…However, Brewster, Wood and Brookes (2016) found that MNCs tended, in general, to be more cautious in departing from national norms than their local counterparts, and tended to be followers rather than leaders in terms of innovating new HRM practices. This would reflect the fact that MNCs enter particular markets because of the advantages they confer (Morgan and Kristensen 2006); hence, they would be less interested in challenging the status quo. Interestingly, those firms most aggressively driving change were those industries facing crises of competitiveness ; this would suggest that innovating in HRM might often represent a response to crisis rather than positive strategic choices to make successful firms even more so.…”

Le transfert des pratiques de flexibilisation de l’emploi dans une firme multinationale : le rôle charnière des acteurs locaux des filiales

“…ex., Bélanger et Edwards, 2006;Ferner et Tempel, 2006;Edwards, Colling et Ferner, 2007;Edwards et Bélanger, 2009) notamment dans les filiales (Bélanger et coll., 1999;Kristensen et Zeitlin, 2005;Bouquet et Birkinshaw, 2008a;Dorrenbacher et Geppert, 2009;Dorrenbacher et Gammelgaard, 2011). Dans ce contexte micropolitique où la MNC est vue comme un espace social transnational (Morgan, 2001), le processus de transfert apparaît comme une négociation sociale (Morgan et Kristensen, 2006) qui n'est pas uniquement fonction de finalités économiques mais aussi de ressources de pouvoir des acteurs et de leurs intérêts (Edwards et coll., 2007;Ferner et coll., 2012). Yahiaoui (dans Cazal et coll., 2010) explique, par exemple, le processus d'hybridation des pratiques RH transférées de la maison-mère vers les filiales tunisiennes par les différences institutionnelles et l'histoire entre les deux pays, mais aussi par la stratégie des acteurs locaux.…”

Microfoundations for learning within international joint ventures

“…Learning between partners from different national contexts is inhibited by different ways of social interaction and different understandings (Morgan & Kristensen, 2006;Pak et al, 2009). If the partners have different organizational cultures, developing absorptive capacity is especially complex (Daghfous, 2004;Nti & Kumar, 2000;Tsai, 2001).…”