MGTO 630B Managing People Globally for Competitive Advantage

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MGTO 630BManaging People Globally for
Competitive Advantage
Please note This is only a preliminary version
of the file that will be shown in class.
A complete version, which incorporates the thread
of the discussion in class, will be available
from the course website after the completion of
the class.
Transferring Management Systems Learning in
IJVs Saturday, March 1, 2003
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By the end of todays class, you should be able
to

• Evaluate the factors contributing to knowledge
  creation / learning in IJVs
• Evaluate the impact of culture on IJV learning /
  performance
• Explain the factors that contribute to
  differentiation (localization) / integration
  (globalization) of HRM practices

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A Re-definition of Global HRM

• The strategic, policy, and practical issues
  related to how MNEs of any type or size manage
  their human resources, including their approaches
  to balancing issues of differentiating and
  integration (duality theory) while enhancing the
  flow of knowledge transfer within the
  organization Brewester, 2002

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Why are alliances important?

• Resource-Based View of the Firm
• Knowledge basis of sustainable advantage / firm
  growth
• Firms able to develop, transfer and exploit
  knowledge most likely to succeed
• No organization can develop within its boundaries
  all critical knowledge needed to prosper and grow
• Original knowledge sources for most critical
  inventions at Du Pont (1920 to 1950) came from
  outside company suppliers, buyers, universities,
  consultants, government agencies, competitors
• Access to broader knowledge bases through
  learning increases firm flexibility external
  capabilities embedded in inter-firm relationships
  ? ALLIANCES

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Figure 5-2. Motivation for International Alliances
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How does learning occur in IJVs?
LOCAL PARTNER
WHOLLY OWNED SUBSIDIARY vs JV
FOREIGN INVESTOR
Organizational Level
Overseas Training
ACQUISITION
GREENFIELD
VS.
Commitment Of human resources
Learning Intent Effort
Industrial Experience
Organizational Unlearning
Individual Level
EXPATRIATE MANAGER
LOCAL MANAGER
Knowledge
Tsang, E. W. K. (2001). Managerial learning in
foreign-invested enterprises in China.
Management International Review, 41, 29-51.
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Figure 5-3. Obstacles to Learning in
International Strategic Alliances
Source Adapted from V. Pucik, Strategic
Alliances, Organizational Learning,
andcompetitive Advantage The HRM Agenda, Human
Resource Management 27 (1988) 77-93.
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Types of knowledge acquired through alliances

• Country specific
• Local government
• Labour force
• Competence with accessing local markets /
  distribution channels
• Firm specific technologies

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What influences firms capabilities to learn /
transfer knowledge?
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Impact of Culture on IJV Knowledge Transfer /
Performance

• What matters more National culture (e.g.,
  Thailand), regional culture (Bangkok) or
  organizational culture (Ferodo)?
• Lets see what insights we can gain from the
  Ferodo case . . .

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Which factors influence the differentiation /
integration of HRM Practices?
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HR practices that tend to be localized

• Time off
• Benefits
• Gender composition
• Training
• Executive bonus
• Participation