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Standardize or Customize: The Interactive Effects of HRM and Environment Uncertainty on MNC Subsidiary Performance
Author(s) -
Cogin Julie A.,
Williamson Ian O.
Publication year - 2014
Publication title -
human resource management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.888
H-Index - 94
eISSN - 1099-050X
pISSN - 0090-4848
DOI - 10.1002/hrm.21602
Subject(s) - subsidiary , multinational corporation , business , personalization , human resource management , industrial organization , profit (economics) , empirical research , knowledge management , marketing , computer science , finance , economics , microeconomics , philosophy , epistemology
This study examines the impact of customizing (as opposed to standardizing) human resource management ( HRM ) practices on subsidiary performance in multinational corporations ( MNCs ). We examine how this relationship is influenced by environmental uncertainty. Hypotheses were tested using data from 92 subsidiaries of a large MNC operating in 27 countries. The results showed an interactive relationship between the customization of HRM practices and subsidiary environmental uncertainty on both financial (net profit) and nonfinancial (customer satisfaction) objective measures of subsidiary performance. The results of this study provide important empirical insights for researchers and practitioners into how HRM can be best configured to drive multiple performance outcomes for MNC subsidiaries. © 2014 Wiley Periodicals, Inc.