A Resource-Based View of the "Best" Companies in Mexico: A Multiple-Case Design Approach
Rao, Pramila, SAM Advanced Management Journal
The increased presence of multinationals in Mexico emphasizes the importance of people management. Mexico has hosted several international human resource management (HRM) conferences indicating the relevance and significance of employment practices. Mexican firms realize that treating employees as assets and investments will have a tremendous impact on financial performance (Emmond, 2005). In 2009, Mexico hosted the North American Leaders Summit with Presidents of the U.S., Canada, and Mexico showcasing its importance as an international trading partner in the North American region (Alisau, 2009).
In an international study of 183 nations by the World Bank, Mexico ranked 35th in the ease of doing or conducting business. Mexico's government is proactively promoting international businesses by making the administrative processes and procedures more straightforward (The World Bank and the International Finance Corporation, 2011). The BRIC (Brazil, Russia, India, and China) economies are also establishing a presence in Mexico to take advantage of business trends in these emerging markets. Because Mexico has a very favorable IT (information technology) environment, Indian IT leaders, have established local offices signaling the importance of Mexico in the Latin American region (Mexico Information Technology Report, 2010). Mexico is ranked 49th among 104 countries for having the required infrastructure for e-technology (or "e-readiness") (Mexico Information Technology Report, 2010).
High-profile Mexican organizations promote progressive HRM practices reflecting the importance of its employees. Cemex, the cement leader, provides and encourages a self-directed training environment with various e-learning programs so that employees can update the skills and abilities required to get ahead in their industry. The CEO of Cemex frequently interviews applicants for upper-level positions, signaling the relevance of talent management. Pemex, the national oil company, adopts a comprehensive human resource information system to integrate various aspects of HRM such as succession planning, e-learning, and professional career management to leverage its superior talent across subsidiaries (Fernandez, 2006; Levansaler, 2010).
The main research question of this paper is: What are the HRM practices of the "best" companies in Mexico? The companies interviewed were identified from the Great Places to Work study that provides an annual rankings of the best companies to work for in Mexico. Identifying "best" companies is a global practice as it helps benchmark superior management practices of organizations from diverse industries. For instance, in the U.S., the Fortune 100 list, established in 1998, provides an annual identification of the best companies. Similarly, most countries identify their "best" organizations through established institutions and surveys (Joo and McLean, 2006; Joyce, 2003).
This goal of this research is to understand "best" HRM practices in staffing, training, and development, performance management, and compensation and benefits. It is important for global practitioners interested in doing business in Mexico to be cognizant of these management practices so that they have a benchmark when establishing in new economies. It also allows practitioners to understand the etic (host) and emic (home) perspectives in management practices.
This qualitative research study is organized as follows: First, it introduces Mexico as a business leader. Second, it offers a resource-based view and also institutional theories as frameworks for this paper. Third, it identifies the case study research methodology adopted for this study. Fourth, it details the best practices as articulated by the respondents from their interviews. Fifth, it integrates the results of the interviews with the theoretical frameworks to provide the discussion section. Finally, it addresses the contributions to the literature and practice and provides a model on best HRM practices. …