ChineseMNCs’ Preparation for Host‐Country Labor Relations: An Exploration of Country‐of‐Origin Effect

Abstract

Numerous studies have demonstrated the existence of the country-of-origin effect and how this effect interacts with other factors in shaping multinational corporations' (MNCs') practices. However, there has been little investigation of different forms of country-of-origin effect, the mechanisms through which this effect occurs, or country-of-origin effect on MNCs from emerging markets. This study explores how country-of-origin effect manifests in Chinese MNCs' preparation for managing host country labor relations, an important area of human resource management (HRM). Based on a study of 21 Chinese MNCs, we argue that country-of-origin effect in relation to Chinese MNCs mainly manifests in two implicit forms, including transfer of managementethos and competitive disadvantage generated from the home base, rather than in the form of direct practice transfer as commonly suggested in the current literature. The major mechanism through which country-of-origin effect plays out is the mind-set of managers, rather than formally established corporate control instruments.

Human resource management in Chinese multinationals in the United Kingdom: The interplay of institutions, culture, and strategic choice

“…This may amplify any internal imbalances in authority and knowledge. While an extensive body of existing work confirms the importance of HRM practices being tailored to local conditions (J. S. Zhu et al, ), our study highlights how expatriate managers impact on management practices and devise solutions that provide “soft” and informal solutions to ongoing challenges. They can also supplement or compensate for—rather than changing—organizational policies.…”

“…Against a backdrop of such liabilities, the creation or preservation of jobs and the adoption of employee‐friendly HRM practices may help Chinese MNEs to gain legitimacy in their host markets (Cooke, ; Kamoche & Siebers, ; Lee, ; Rao‐Nicholson, Khan, & Stokes, ; Tung, ; J. S. Zhu, Zhu, & De Cieri, ). Hence, Liu and Woywode () argue Chinese MNEs often adopt a “light touch” integration approach toward their acquired subsidiaries.…”

“…Finally, in some of the MNEs we studied, we encountered boundary‐spanning managers, typically Chinese nationals, who have spent some time in the West (e.g., studying) or are Western‐born Chinese. A high number of these expatriates are often sent to subsidiaries acquired by Chinese MNEs (e.g., Cooke, , ; Meyer & Xin, ; Smith & Zheng, ; J. S. Zhu et al, ). Studies suggest due to its bureaucratic heritage, traditional Chinese personnel management is inefficient compared to advanced economies’ HRM practices (e.g., Cooke, , ).…”

Islamic work ethics and individualism in managing a globalized workplace: Does religiosity and nationality matter?

“…Various other cross-cultural studies (e.g., Yousef, 2000;Abu-Saad, 2003;Ali & Al-Kazemi, 2007) examined the influence of NAT and country's political/ economical state on work ethics. Significant effects of country-of-origin on MNCs management psyche and labor relations have been reported (Zhu, Zhu, & De Cieri, 2014). Beekun, Stedham, Westerman, and Yamamura (2010) investigated the relationship between ethical intention and gender in view of their national setting, and found that female respondents were more ethically driven than male.…”

A corporate entrepreneurship perspective of pre‐entry strategies for internationalization: A case study of a Chinese business conglomerate

“…This article utilizes an in‐depth case study approach to explore how a large state‐owned Chinese business conglomerate developed its firm‐specific advantages during a 5‐year period before international expansion. Although Chinese state‐owned enterprises (SOEs) enjoy some privileges such as policy support (Song et al, ), they also experience barriers to internationalization such as institutional constraints, governance drawbacks, the legacy of the planned economy, and other state ownership disadvantages (Zhu, Zhu, & De Cieri, ). To grow from a local player to a global competitor, this conglomerate spent several years restructuring itself, re‐engineering business routines, relocating resources, and introducing innovations such as a new human resource management (HRM) system to nurture its capabilities for internationalization.…”