The "country of origin effect" in the cross national management of human resources

The impact of American Multinational Companies (MNCs) on the German economy is significant. The report presents the results of a research project on how these companies transfer human resource management (HRM) practices from their U. S. headquarters to their German subsidiaries. It discusses to what extent adaptation to local practices takes place, for example, in areas such as performance-related pay, direct communication at the workplace, development of expatriates or strategies towards employee representation. It is of particular interest to show how the German environment influences the HRM strategies of American subsidiaries and what strategies are developed to cope with these influences. The key theme of this study is the question whether there will be a convergence of HRM practices following world-wide integration, or, conversely, to what extent national differences persist and how these could be used as resources. The empirical basis of the project are case studies in American MNCs in Germany through which a detailed picture of their HRM practices is conveyed. The research is linked to similar projects in other European countries (UK, Ireland, Spain), where the HRM practices of the same MNCs are studied. The research will thus throw light on different HRM practices in the individual countries. It is expected that there will be different patterns of HRM in each country. The findings could have important policy implications for the investigated companies in terms of ease of entry into new national contexts and of identifying HRM practices in subsidiaries which could serve as a benchmark for other parts of the company.