Organization culture types and the replication of transferred human resource management practices in multinational subsidiaries in Nigeria
| DOI | https://doi.org/10.1108/ER-04-2021-0134 |
| Published date | 20 December 2022 |
| Date | 20 December 2022 |
| Pages | 565-584 |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations,Employment law |
| Author | Raphael Oriaghe Oseghale,Dennis Pepple,Simeon Emezana Ifere,Amarachi Ngozi Amaugo |
Organization culture types and
the replication of transferred
human resource management
practices in multinational
subsidiaries in Nigeria
Raphael Oriaghe Oseghale
Hertfordshire Business School, University of Hertfordshire - De Havilland Campus,
Hatfield, UK
Dennis Pepple
School of Business, University of Leicester, Leicester, UK
Simeon Emezana Ifere
University of Lagos, Lagos, Nigeria, and
Amarachi Ngozi Amaugo
De Montfort University, Leicester, UK
Abstract
Purpose –Given that institutional and cultural factors affect the transfer of HRM practices between
multinational companies (MNCs) and their subsidiaries, the paper set out to investigate the explanatory
mechanism for the replication of transferred HRM practices and the factors likely to influence the choice of
transfer mechanisms.
Design/methodology/approach –Using an exploratory qualitative appr oach, 40 interviews were
conducted with senior managers and employees in two MNC subsidiaries located in the alcoholic beverage
and oil industries in Nigeria.
Findings –The findings suggest that organizational culture (OC) was the mechanism for MNC HRM
replication and inhibition. In addition to explaining the mechanisms for HRM practice replication, the authors
developed a conceptual framework to explain how clan and hierarchical OC influence the extent to which
human resource (HR) practices are replicated or inhibited and how institutional and cultural factors influence
the choice of OC.
Originality/value –The study uncovered that MNCs deploy hierarchical OC to oversee the replication of
transferred practices. Interestingly, the authors found that institutional and cultural environments were key
factors that influenced the choice of mechanism for overseeing the replication of HR practices. The conceptual
framework can help managers of MNCs to understand how to replicate transferred HRM practices in
developing countries.
Keywords HRM transfer, Institutional theory, Multinational companies, National culture,
Organizational culture
Paper type Research paper
Introduction
Multinational companies (MNCs) generally face pressure to transfer best human resource
(HR) practices from headquarters to overseas subsidiaries to drive desired HR outcomes and
achieve sustainable advantages (Poor et al., 2020). However, achieving a successful
replication of HR practices in subsidiaries can be problematic due to institutional, cultural
and organizational factors (Latukha et al., 2020). The inability to replicate HR practices
transferred from headquarters can hinder the attainment of the intended outcomes and
sustainable competitive advantage in subsidiaries. This is because replication often violates
Multinational
subsidiaries
in Nigeria
565
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Received 4 April 2021
Revised 1 May 2022
14 July 2022
14 September 2022
28 October 2022
Accepted 31 October 2022
Employee Relations: The
International Journal
Vol. 45 No. 3, 2023
pp. 565-584
© Emerald Publishing Limited
0142-5455
DOI 10.1108/ER-04-2021-0134
or prevents local responsiveness, which is the best method to achieve local competitiveness.
A practice is considered replicated if the subsidiary maintains the core principles associated
with it, whereas relevant modifications are made to adapt such practices to the local
environment (Beletskiy and Fey, 2021). Some scholars (e.g. Chiang et al., 2017) have argued
that transferred practices that fail to achieve the intended outcomes are a waste of the
resources invested in the transfer process. However, this is not always the case, as some
benefits accrue from the deployment of certain best human resource practices (Lertxundi and
Landeta, 2012). Thus, MNCs develop a common corporate culture across subsidiaries to
foster the organizational learning required to enhance productivity (Zhu, 2019). However, in
terms of HRM, not all HR practices can be easily transferred from headquarters and
replicated in subsidiaries. Despite this, subsidiaries face competing pressures on whether to
adopt parent company practices or adapt to local norms (Latukha et al., 2020).
A vast body of research on whether subsidiaries behave like local firms or headquarters
exists in transfer literature (Poor et al., 2020). Similarly, there is some research evidence on the
role of institutions, national culture and corporate organizational factors in explaining the
extent to which certain HRM practices are transferred or localized within subsidiaries
(Nwagbara, 2020). While prior research has identified mechanisms underpinning the transfer
and replication process, there is limited literature (except Beletskiy and Fey, 2021;Schneider,
1988;Song, 2021,2022) that explains the organizational culture (OC) types responsible for
replication and factors that are likely to influence the choice of different mechanisms through
which practice is replicated (Chiang et al., 2017). Moreover, prior research investigating the
influence of different contextual elements has been predominantly Western-centric (Chiang
et al., 2017). Given this, a greater diversity of samples is required to extend and test the current
contextual limitations in the literature (Beletskiy and Fey, 2021;Song, 2021).
Findings from such an examination will provide broader and more representative MNCs
with strategies to effectively manage the transfer and practice replication process. We
address these gaps in the literature by using institutional theory to further our understanding
of the types of OC that facilitate the replication of transferred HR practices and the factors
that are likely to influence the choice of such mechanisms in a developing context, using
Nigeria as an empirical focus. HRM transfer remains an important agenda in Nigeria, as
contemporary Nigeria is still involved in social, political and economic transformations.
According to Myloni et al. (2004), institutional and cultural environments are crucial for
understanding HRM transfer and replication in host countries in a transitional state, where
institutions are in a continuous state of transformation.
Drawing on institutional and OC frameworks to understand the subject area in the
developing context of Nigeria will contribute to the literature in some important ways.
Interestingly, we contribute to the literature by revealing that while clan OC is an inhibiting
mechanism, hierarchical OC is a facilitating mechanism in the diffusion process. To the best
of our knowledge, only a limited number of studies (except Beletskiy and Fey, 2021;
Schneider, 1988;Song, 2021,2022) have provided insights into how various OC types affect
the implementation and lack of implementation of transferred HR practices. Additionally, we
contribute to the literature by highlighting the importance of institutional and cultural
environments in determining the choice of OC as the mechanism through which practice
replication would take place. Lastly, given the paucity of research on this topic in developing
countries, our research provides a developing country’s perspective in the literature (Latukha
et al., 2020).
Theoretical foundation
HRM transfer revolves around debates on the convergence or divergence of HR practices
deployed in subsidiaries compared to those at MNCs headquarters (Ayentimi et al., 2018a).
ER
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