The researchers examined the HRM practices in 286 Chinese subsidiaries of US, German and Japanese companies and identified a series of influences which they divided into ‘push’ factors from the parent firm and ‘pull’ factors from the ‘host country.’
The strongest ‘push’ factor was from financial control in subsidiary investment decision and joint venture structure where such decisions led to changing existing local practices to those closer to Western HRM practices. Little difference was identified in industry sector or the country of origin. In addition, many HRM practices may be converging to a more common universal form across different types of subsidiaries. Where the subsidiary was minority-owned, the degree of HRM practices was more limited.
Interestingly, there is a good evidence that parent firms start in China with global strategic imperatives for HRM practices but they become constrained by local environment and cultural conditions and make major modifications.
The largest direction of ‘push’ is towards a performance-oriented culture, including value systems that strive for efficiency and quality, employee appraisals focusing on financial performance and encouraging skills development. Where there is a greater pull factor from the local environment, (measured by longer time period of establishment in that locality), the practices tend to show a traditional flavour, such as provision for employee housing, consideration of the educational background for hiring managers and referrals. This is not to say that Western-style practices are absent, it is more a more hybrid system that has developed.
‘As the competition in the Chinese market for skilled labour becomes stronger, many multinational firms are expected to adopt more “best” HRM practices that are not only results-oriented but also fit local cultural and social environments … Those managers adapting to the dual forces of “push” and “pull”, linking global management policies and practices to the specific Chinese environments, sensitive to Chinese local culture and practices and willing to be flexible while maintaining professional standards may be most likely to succeed in the Chinese market.’ (p. 702)
