HRM practices of MNEs and domestic firms in Ghana: divergence or convergence?

Abstract

Purpose The purpose of this paper is to adopt the convergence-divergence perspective to examine the extent of similarities and differences in human resource management practices between multinational enterprise subsidiaries and local firms in Ghana. Design/methodology/approach This paper draws from multiple case study evidence using in-depth face-to-face interviews and document analysis. The data were analyzed in four stages using both thematic analysis and cross-case analysis techniques. Findings The authors found both convergence and divergence, however, the evidence points to more convergence and direction toward convergence between MNEs and local firms’ HRM practices. Research limitations/implications Even though there was evidence of cultural embeddedness within local firms in the adoption of certain HRM practices, the influence of national culture on HRM practice convergence between MNEs and local firms has been limited. Thus, the convergence-divergence debate through the lens of national culture may need to be re-examined. Practical implications The evidence of convergence and direction toward convergence tendencies within the context can be argued to be less underpinned by local isomorphism limited host-country influence. Practically, there is something to learn from indigenous Ghanaian organizations that can contribute to HRM advancement, the Ghanaian concept of annual durbars, annual or semi-annual gatherings to take stock of past activities and to award hard working staff, could provide the platform to strengthen the employer-employee relationship at the firm level. Originality/value This study fills an important contextual gap (a less developed country’s context) within the convergence-divergence debate and contributes to informing new knowledge of the convergence-divergence debate, which points to more convergence and direction toward convergence between MNEs and local firms’ HRM practices.

Does the historical and institutional re-construction of Ghana support the transfer of HRM practices?

“…For example, advanced economies MNEs act as innovators and disseminators of new organizational forms and best HRM practices into developing host-countries (McDonnell et al, 2015). Third, HRM policies and practices have noticeable potential for transfer by MNEs, especially those originating from developed economies and operating in less developed economies in Sub-Saharan Africa (Bonache and Brewster, 2001;Ayentimi et al, 2018b). This paper complements the HRM practice transfer literature in several ways.…”

“…The indirect system of governance allowed the British to rule their colonies through indigenous traditional rulers and chiefs. The chiefs and traditional rulers were given some partial administrative authority and control over their own people (Ayentimi et al, 2018a(Ayentimi et al, , 2018bDebrah, 2013). The indirect rule system was driven by the lack of British personnel in Africa and the indirect rule system was cost-effective compared to bringing in expatriate administrators to a remote and inhospitable region.…”

“…Theoretically, there is an established body of HRM and international management literature through the lens of cultural dimensions theory (Minkov and Hofstede, 2012;House et al, 2004) and an institutionalists perspective (Scott, 2001;DiMaggio and Powell, 1983) on how host and home-countries' cultural and institutional differences influence HRM practice transfer between MNEs and their subsidiaries (Ayentimi et al, 2018a;Bjorkman et al, 2008). Within the global space, it is generally clear that Africa is contextually distinctive from other regions because of the embeddedness of cultural diversity, colonialism and decolonialism denoting the wider social and cultural distance (Ayentimi et al, 2018b;Decker, 2013aDecker, , 2013b. Notwithstanding, such a distinctive perspective from other regions, there is a further degree of distinctiveness, particularly between Ghana and her neighbours, where an indirect rule system of governance was entrenched in the British colonial administration system, whereas the policy of assimilation was grounded in the French colonies (Ayittey, 2006).…”

Responsible Firm Behaviour in Political Markets: Judging the Ethicality of Corporate Political Activity in Weak Institutional Environments

“…First, managers who are related to politicians, whether in a nuclear or extended family sense, leverage their kinship to gain access to the polity. As Ghana has a collective national culture (Ayentimi et al 2018), kinship is the most valuable asset for deploying a relational strategy. Politicians are more willing…”

Macro‐institutional conditions in Ghana and the challenges to HRM program development and implementation

“…Ghana provides an important nontraditional context to explore the macro‐institutional conditions and the challenges to HRM program development within local firms and MNE subsidiaries (Ayentimi, Burgess, & Brown, ). Ghana, like many other less‐developed or emerging economies, is increasing its participation in the global economy through the use of policy and programs to attract foreign direct investment (Adams, Debrah, Williams, & Mmieh, ).…”