Incorporating Worldwide Input into Human Resource Decision Making in High Technology Companies

Article excerpt

A substantial body of literature addresses the contrasting pressures on multinational enterprises for worldwide consistency versus local adaptation in companies' strategies and operations (e.g., Bartlett & Ghoshal, 1989; Rosenzweig & Singh, 1991). Additional studies have demonstrated the value of input from widespread geographic localities in contributing to the implementation of decisions (Prahalad & Doz, 1987; Kim & Mauborgne, 1993), whether or not these decisions are made centrally. Little has been done, however, to investigate mechanisms used to obtain such input. For this study, HR executives in 15 large U.S.-based high technology companies were asked about mechanisms to seek feedback on HR policy development from geographically dispersed operations. In this article, we identify nine mechanisms that surfaced in the interviews, provide examples of their use in participating companies, and present a table that outlines their advantages and disadvantages.

As firms based in the United States seek to increase their presence in overseas markets, they invariably confront the dilemma of dealing with cultural mores different from their own. While the imperative of competitive strategy may call for consistency, and hence control, the cultural imperative speaks more to differentiation (Schuler, et al., 1993). Some argue that the move toward global strategy places the repository of power in headquarters so execution can be handled in a centralized fashion (Ghoshal, 1987); others aver that the increased competence and expertise resident at the local level militate against headquarter's ability to impose unilateral mandates (Tayeb, 1998).

Yet if the proclivity for either centralization or decentralization is too pronounced, it can impede organizational learning. On the one hand, wholesale assimilation of host cultures into the parental panoply may be viewed as simplistic at best and paternalistic at worst. This kind of unilateral imposition does not incorporate local learning and tends to regard the national subsidiaries "as mere pipelines to supply the organization's value added" (Ghoshal, 1987, at 432). On the other hand, divergent purpose and practice across affiliates prevent the unity of direction that is a prerequisite to corporate success in global markets. In a decentralized context parochial views may restrict the flow of information and the transfer of knowledge. As Ghoshal observes, the three "handmaidens of decentralization" are "local loyalties, turf protection, and the 'not invented here' syndrome" (p. 432).

Some variant mix of control and autonomy is present in every multinational enterprise (MNE), reflecting the simultaneous need for standardization and sensitivity (Laurent, 1986; Bartlett & Ghoshal, 1989; Martinez & Jarillo, 1991). These twin forces are continuous variables rather than discrete dimensions (Ghoshal & Nohria, 1993). As a result, the MNE is forever destined to strive for a balance based on "simultaneous loose-tight requirements" (Schuler, et al., 1991, at 365). Because both sets of pressures are endemic, only their relative intensity will vary (Kobrin, 1992). Moreover, the mode of optimal adaptation may change over time, placing an onus on organizations to demonstrate flexibility in the face of environmental demands and internal dynamics (Milliman, et al., 1991).

The academic literature is replete with attempts to reconcile these competing pressures for local conformity and global consistency. Various typologies have been constructed to assist MNEs in their effort to define and determine the proper balance. Some underscore the importance of external influences while others highlight managerial predisposition. Porter (1986), for example, looks at industry type along a competitive continuum ranging from "multidomestic" to "global" whereas Perlmutter (1969) focuses on the attitude of senior management toward international operations. Barlett and Ghoshal (1989) provide a distillate of four MNC "mentalities" that subsumes these distinctions pertaining to strategic proclivity. …