concerning the management of employment relations in their foreign
subsidiaries as essentially a trade-off between the competitive pressure to utilise
those practices that formed a part of successful production at home on the one
hand, and the need to adapt to the exigencies of local conditions on the other.
The contribution of this approach stems from the recognition of the poten-
tial advantages that can arise from transferring employment practices. However,
the rational approach risks downplaying the contested nature of transfer. The
balance between adopting policies that are both globally integrated and locally
sensitive tends to be portrayed as a technical matter, on which senior managers
simply need to come to a reasoned judgement. Where some recognition is given
to the possibility that there will be differences of view on the desirability of
transferring practices, as in Ghoshal and Bartlett’s (1998) work, senior managers
are seen as having the ability to resolve any problems through communication
and persuasion. Ghoshal and Bartlett talked of the need to create an appropri-
ate ‘management mentality’, for example. However, as a range of studies of
MNCs has revealed, the process of transfer across borders is an intensely politi-
cal process, in which a number of organisational actors have some influence.
A good example of research which emphasises the political nature of transfer is
Belanger et al.’s (1999) study of ABB, a company cited by Ghoshal and Bartlett
themselves as a ‘classic transnational organisation’. Belanger and his colleagues
argued convincingly that Ghoshal and Bartlett’s account of ABB downplays the
tensions between groups which are a key feature of organisational life in multi-
national companies, and they demonstrated that international coordination is
strongly contested within the firm.
The culturalist approachThe culturalistapproach is the second form of explanation as to the reasons
why MNCs transfer practices across their sites in different countries. Many
argue that the transfer of practices is not so much a process governed by the
forces of competition as one shaped by the legacy of national and corporate
cultures. Writers from this approach commonly draw on Hofstede’s (2001)
much-cited work, originally published in 1980 with an updated version more
recently, in which he distinguished a number of dimensions along which
national cultures differ (see Chapter 6 for a discussion of this and other frame-
works of cultural dimensions). The culturalist approach raises two important
points concerning the transfer of practices. First, it provides an explanation,
albeit partial, for why MNCs must adapt their desired practices to local condi-
tions rather than adopting common practices across their operations.
Hofstede’s own study of IBM showed that even in a company with a strong
company culture, there were marked variations in employee values at the local
level. An extension of this idea is the fact that national cultures inform the
behaviour of MNCs in a different sense: MNCs take aspects of a national culture
392 International Human Resource Management