The transfer of HRM practices from emerging Indian IT MNEs to their subsidiaries in Australia: The MNE diamond model

Abstract

There is a growing body of literature on multinational enterprises (MNEs) and the extent to which they diffuse or transfer their human resource management (HRM) practices in foreign subsidiaries. Much of the research, however, examines the HRM practices of multinational enterprises from developed countries operating in developing countries rather than vice versa. This study investigates the transfer of HRM practices in Indian information technology MNEs with subsidiaries in Australia and draws on data collected through interviews with senior subsidiary managers. The findings indicate that contrary to what is suggested in the existing literature, Indian IT MNEs do not operate using a polycentric HR model but behave in a manner similar to Western MNEs. They adopt a hybridisation approach using headquarter(HQ)-local practices that merge home-country policies with locally responsive HRM practices to suit their Australian subsidiary context. This article discusses the implications of this finding for theory and practice in EMNEs.