The impact of Chinese cultural values on human resource policies and practices within transnational corporations in China

Abstract

This thesis focuses on key cross-cultural issues that transnational corporations (TNCs) face when formulating and implementing Human Resource (HR) policies and practices in their Chinese affiliates. The aim of this study is two-fold. The first is to investigate how employees perceive HR policies and practices that have been transferred from parent enterprises of TNCs, and the second is to explore the extent to which Chinese cultural values influence these HR policies and practices. These aims are addressed through an exploratory research design using in-depth qualitative interviews with seventy-six participants across twenty-one Western TNCs and two Chinese state-owned enterprises in China. By presenting the differences between the HR policies and practices with Western TNCs and Chinese companies, the distinctive Chinese cultural values can be interpreted against a more holistic background. This study contributes to international human resource management (IHRM) literature by empirically investigating the perceptions and views of both managerial and non-managerial employees on HR policies and practices within the participating companies. This study explores the contemporary Chinese cultural values and examines how these cultural values exert influence on the HR policies and practices. The findings of this study demonstrate a variation between global HR policies and practices of TNCs and their implementation at the local level. Moreover, the researcher finds that there are three national cultural values with Chinese characteristics which can affect HR policies and practices within TNCs in China; these are: guan-xi, valuing seniority, and the importance of the „human factor‟. It is indicated that Chinese cultural values are far more sophisticated than the ones conceptualised in previous literature, as these three cultural values appear to be interlinked and be embedded within the Chinese culture of collectivism. More importantly, the study shows that these deeply embedded cultural values can not be easily „ironed-out‟ by organisational culture and global HR policies and practices of TNCs. Therefore, it is argued that TNCs need to acknowledge cross-cultural differences and consider these Chinese cultural values when implementing their global HR policies and practices in China. Organisational and managerial commitment to such an approach would require conscious steps to be taken towards adopting a closely monitored HR implementation process and more inclusive HR policies and practices, rather than expecting Chinese employees to accept and adopt the global HR policies and practices which may be against their cultural values and norms.