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The Determinants Of IHR Strategy

Resource dependence 2. Institutionalism  Interdependency are crucial factors influencing subsidiary’s IHR strategies.Inter-organizational inter-dependence Two perspectives: 1. .  Subsidiary’s Resource dependency on parent company influences its HRM policies & practices.

Relational networks in institutional environment have an important influence on the organization’s behavior. Networks such as:  Host institutions  competitor’s businesses  Suppliers  regulators .

.Dependence on Parent’s Resources Parent resources can be:  Capital  Technology  Management Geographical location of subsidiary More the resources dependency. more the global integration/ standardization.

Hypothesis 2 • The globalization of subsidiaries’ IHR strategies will be positively related to the extent of their dependence on their parents’ resources. .

 HR Strategies reflects more localization.  Difficult for parent to impose universal management system & procedures. .  Dependency/ support from parent company reduces.Dependence on local resources When subsidiary reaches maturity stage:  Dependency/ fit with local environment increases.

Hypothesis 3 • The localization of subsidiaries’ IHR strategies will be positively related to the extent of their dependence on local resources. .

Dependence on Host Institutions Organizations compete for:  Resources  Customers  Political power  Institutional legitimacy  Social acceptance .

Not only this but also Subsidiaries interacts with & depends on host country’s:  Govt. equal employment oppertunity) . mores & statutes (minimum wage laws.  Advocacy groups  Regulators  Competitors  Country’s customs.

.Hypothesis 4 • The localization of subsidiaries’ IHR strategies will be positively related to the extent of their dependence on host institutions. More the legal & socio-cultural differences. more the unique SIHRM practices are adapted.

Ownership Alliances i.e. 1.  Interaction between parent’s ownership stake & subsidiary dependence on host institution. ↑ parent’s ownership stake = ↑ parent’s power = rely on IHR globalization. ↓ parent’s ownership stake = ↓ parent’s power = rely on IHR localization. 2. JV. franchising etc also creates managerial challenges for both parent & subsidiary. .

.Hypothesis 5 a • The globalization of subsidiaries’ IHR strategies will be positively related to the interaction of their dependence on host institutions and their parents’ ownership stake.

.Hypothesis 5 b • The localization of subsidiaries’ IHR strategies will be inversely related to the interaction of their dependence on host institutions and their parents’ ownership stake.

.Data. Measures & Methods Data: • Subsidiaries operating in Taiwan were surveyed • Sample size = 100 Industry type. • Manufacturing • Service Questionnaire mailed to each subsidiary completed by either CEO or Chief HR executive.

Dependent variable • IHR Strategy (Localization or Globalization) 2. local resources. Explanatory variables • Inter-organizational interdependence (dependence on parent’s resources.Measures: 1. Host institution) • Ownership( parent’s capital investment) .

Control variable: • Industry (manufacturing or service) • lukysalu@gmail.3.com .