The Transfer of ‘International Best Practice’ in a Brazilian MNC: A Consideration of the Convergence and Contingency Perspectives

Abstract

This study examines the transfer of a Brazilian MNC's HR model to its subsidiaries in the UK, Canada, Switzerland and Norway. It explores where the model was sourced from, to what extent it bore a distinct Brazilian complexion, and whether it was adapted to meet the strictures of host institutional constraints and traditions. The paper uses these questions to address an important theoretical debate in the international business literature; that is, whether the pattern of diffusion of management practices within MNCs will lead to a convergence of practices across companies and countries à la the convergence perspective, or whether this is unlikely given the variety of social and political constraints limiting such a process as suggested by the contingency perspective. We find that the MNC imposed a unitary (USsourced) model of HR 'best practice' on all of its subsidiaries. Thus our empirical findings support the convergence thesis. However, we argue that these outcomes are largely explained by relations of power and economic dependence; specifically the coexistence of dominantcountry (US) practices and a dominant sectoral firm operating in economically dependent regions. Where similar circumstances are replicated one might foresee convergence within sectors across countries, but otherwise pluralism and eclecticism between sectors and across countries might be the predominant pattern along the lines envisaged in the conceptualization of "converging divergences".

The liability of mimicry: Implementing “global human resource management standards” in United States and Indian subsidiaries of a South Korean multinational enterprise

“…While the tendency of mimicking "global best practices" from a dominant economy and disseminating them to subsidiaries has been well evidenced in the cases of EMNEs (Andreeva et al, 2014;Geary et al, 2017;Zhang & Edwards, 2007), the specific challenges of implementing this sort of approach have received little attention.…”

“…Recent studies of EMNEs have examined the implementation of such practices across subsidiaries in industries where EMNEs enjoy dominant positions, or in particular kinds of host countries (Andreeva et al, 2014;Geary et al, 2017). ment" and adopt more ambitious approaches (Madhok & Keyhani, 2012, p. 35).…”

“…National economies with greater power and influence in the global political economic hierarchy exert a "dominance effect" (Smith & Meiksins, 1995), which means "global best practices" are shaped by the institutional legacies of powerful countries-at present, mainly the United States (Pudelko & Harzing, 2007). This tendency to transfer third-party practices, rather than exporting parent practices, has often been reported in the cases of MNEs from non-traditional origins including newly developed economies, such as South Korea or Taiwan, or emerging economies, such as China or Brazil (Chang, Mellahi, & Wilkinson, 2009;Cooke, 2014;Edwards, Schnyder, & Fortwengel, 2019;Geary, Aguzzoli, & Lengler, 2017;Glover & Wilkinson, 2007). These EMNEs face distinct challenges in internationalizing their businesses (Luo & Tung, 2007), encapsulated as the "liability of origin" (Ramachandran & Pant, 2010) or the "liability of emergingness" (Madhok & Keyhani, 2012).…”

The transfer of HRM practices from emerging Indian IT MNEs to their subsidiaries in Australia: The MNE diamond model

“…The majority of these debates, however, have looked at investigating MNEs from developed countries with subsidiaries in developing countries (Chen, Lawler & Bae, 2005;Colakoglu, Allen, Miah, & Bird, 2016;Fan, Xia, Zhang, Zhu & Li, 2016;Ferner, 2009;Fey & Bjorkman, 2001;Glover & Wilkinson, 2007;Kuhlmann, 2012;Lovett, Perez-Nordtvedt & Rasheed, 2009;Maharjan & Sekiguchi, 2017). A smaller stream of research has examined the HRM practices of MNEs from emerging economies (EMNEs) operating their subsidiaries in developed countries (Adams, Nyuur, Ellis, & Debrah, 2017;Chang, Mellahi & Wilkinson, 2009;Fan et al, 2013;Geary, Aguzzoli & Lengler, 2017;Gomes, Sahadev, Glaister, & Demirbag, 2015;Thite, 2015;Thite, Wilkinson & Shah, 2012;Ying Chang, Wilkinson & Mellahi, 2007). This article adds to this underdeveloped but growing research agenda by studying the transfer of HRM practices from Indian IT MNEs to their subsidiaries in Australia.…”

Mapping the impact of home‐ and host‐country institutions on human resource management in emerging market multinational companies: A conceptual framework

“…Accordingly, Geary and Aguzzoli () note that the specific content of their case study company's HRM policies were informed by U.S. practice, influenced in this direction by the development of American‐influenced business schools and consultancy firms and by American MNCs in Brazil (see also Mellahi, Frynas, & Collings, ). In subsequent analysis, Geary and colleagues argue that while the particular practices that formed the company's approach were not discernibly “Brazilian,” they were nevertheless implemented through a style of management that was deeply rooted in Brazil's national business system (Geary, Aguzzoli, & Lengler, ).…”