Convergence-divergence Debate Research Articles

Cross‐Country Analysis of HRM Parameters in Emerging Markets: An Assessment of Measurement Invariance

AbstractIn this paper we aim to critically discuss the challenges and benefits of using survey instruments (SIs) by measuring human resource management (HRM) parameters across five emerging markets – Brunei Darussalam, India, Jordan, Kingdom of Saudi Arabia and United Arab Emirates. In so doing, we proceed to an assessment of the measurement invariance of HRM parameters measured by SIs across these five countries. Based on our field experience and empirical results showing lack of measurement invariance across these five national contexts, we provide recommendations for conducting comparative analysis of HRM parameters in emerging markets, ultimately contributing to the HRM convergence–divergence debate in this type of national context.

Human Resource Management Practices of Foreign Manufacturing Companies in Bangladesh: A Comparative Study

This study aims to investigate and compare human resource management (HRM) practices among the foreign manufacturing subsidiaries operating in Bangladesh. We interviewed 36 managerial employees from three types of companies based on their country of origin: two Japanese, two British and two American. The findings reveal that a blend of HRM practices has been adopted by the foreign subsidiaries, executed by imitating home and host country practices. Results found that Japanese subsidiaries are heavily influenced by their parent company, which affects the core HRM practices of their companies in Bangladesh. On the other hand, the subsidiaries of the United Kingdom and the United States in Bangladesh have taken a different route. They have adapted and adjusted the HRM practices from the host country and implemented them with their internationalisation stages. This study further suggests that the home and host country debate through the framework of national culture may need to be re-examined. This research fills the knowledge gap in the literature on cross-cultural HRM practices, convergence–divergence debate among MNC firms’ HRM practices and foreign subsidiaries’ relationships by analysing the socio-cultural and institutional influences of the host countries.

Proliferation of corporate governance codes in the backdrop of divergent ownership structures

In the backdrop of the convergence–divergence debate, the goal of this article is to examine the proliferation of corporate governance codes in the light of a single factor, namely varying corporate ownership structures across countries. While such codes emanated and became popular in the United Kingdom where companies largely display dispersed shareholding, the concept has been disseminated to countries that carry considerably different ownership structures, i.e. mainly concentrated shareholding. This is bound to give rise to incongruities in the implementation of these codes. In order to enunciate the claim made above, the article will consider two aspects that convergence advocates have focused on, namely (i) shareholder empowerment and (ii) self-regulation. For example, corporate governance codes place considerable emphasis on the structure and independence of the boards of directors of companies as a means to ensure shareholder protection. While this approach is meant to produce results in companies with dispersed shareholding, the same cannot be said of companies with concentrated shareholding where the empowerment of shareholders through director independence or other means would only embolden the already dominant controlling shareholders. Moving to self-regulation, a voluntary code operating on a ‘comply-or-explain’ basis can ensure sufficient adherence only if certain factors are present in the jurisdiction where it is applied. Relying upon available empirical evidence, this article finds that use of self-regulation in voluntary codes of corporate governance may generate different results depending upon the ownership structures of companies, thereby exhibiting signs of divergence on this count.

HRM practices of MNEs and domestic firms in Ghana: divergence or convergence?

PurposeThe purpose of this paper is to adopt the convergence-divergence perspective to examine the extent of similarities and differences in human resource management practices between multinational enterprise subsidiaries and local firms in Ghana.Design/methodology/approachThis paper draws from multiple case study evidence using in-depth face-to-face interviews and document analysis. The data were analyzed in four stages using both thematic analysis and cross-case analysis techniques.FindingsThe authors found both convergence and divergence, however, the evidence points to more convergence and direction toward convergence between MNEs and local firms’ HRM practices.Research limitations/implicationsEven though there was evidence of cultural embeddedness within local firms in the adoption of certain HRM practices, the influence of national culture on HRM practice convergence between MNEs and local firms has been limited. Thus, the convergence-divergence debate through the lens of national culture may need to be re-examined.Practical implicationsThe evidence of convergence and direction toward convergence tendencies within the context can be argued to be less underpinned by local isomorphism limited host-country influence. Practically, there is something to learn from indigenous Ghanaian organizations that can contribute to HRM advancement, the Ghanaian concept of annual durbars, annual or semi-annual gatherings to take stock of past activities and to award hard working staff, could provide the platform to strengthen the employer-employee relationship at the firm level.Originality/valueThis study fills an important contextual gap (a less developed country’s context) within the convergence-divergence debate and contributes to informing new knowledge of the convergence-divergence debate, which points to more convergence and direction toward convergence between MNEs and local firms’ HRM practices.

English

English

Where are they going? Case of British and Japanese human resource management

PurposeThe purpose of this paper is to explore and understand corporate social responsibility (CSR) and human resource management (HRM) practices of the UK and Japan, who share opposing societal and cultural characteristics, from a national business system (NBS) perspective, to answer the following two questions: the extent of convergence/divergence of CSR-HRM of two very different NBS, and the institutional relations behind the convergence/divergence.Design/methodology/approachFor these purposes, the paper proposes a framework that can be utilised to understand the complex relationships between institutions, HRM, and CSR. Using a qualitative approach and grounded theory analysis as well as multiple-case analysis of six cases from the UK and Japan, the findings are tested against the framework.FindingsThe paper was able to confirm that mimetic and coercive isomorphism from global institutional pressure cause certain convergence of CSR-HRM in these two nations. However, simultaneously, the local institutional pressure (i.e. NBS) appears to be deeply rooted and is more salient at micro-level, resulting in diversified CSR-HRM in the two nations. As a result, it appears that convergence and divergence co-exist due to their differences in NBS with possibility of “crossvergence”.Originality/valueThis paper’s significance lies not only in contributing to the existing convergence–divergence debate on both CSR and HRM but also to help understanding of how Western CSR-HRM concepts are utilized and interpreted in East Asian countries with very different NBS from the West, with the aid of the proposed framework.

Convergence and divergence in corporate governance

PurposeWhether corporate governance systems and practices are converging to the Anglo-American shareholder-value-oriented model or continue to diverge from this model and maintain their idiosyncrasies has been controversially debated among scholars in a variety of academic disciplines. The purpose of this paper is to review, critique and integrate the disparate positions in the convergence-divergence debate in corporate governance and to suggest promising directions for future research.Design/methodology/approachThe author constructs a theoretical framework in which convergence and divergence dynamics are conceptualized as simultaneous processes of institutional change and continuity. This framework takes into account the influence of economic market forces, social embeddedness and cultural forces in shaping corporate governance at the national and the firm levels and provides a holistic and integrative perspective on the extant literature in the convergence-divergence debate.FindingsThe literature review does not support either the predictions of convergence advocates or the predictions of divergence advocates. Instead, the paper finds that convergence and divergence dynamics can coexist and lead to increasing heterogeneity in corporate governance arrangements of firms within and between corporate governance systems. This finding adds complexity to the debate and opens room for interesting research directions.Originality/valueThe paper offers a comprehensive review of the topic and draws from literature in financial economics, comparative law, economic sociology, international business, political science and strategic management. Most importantly, the paper offers a multi-theoretical framework that allows for an integration of the divergent perspectives presented in the literature.

Economic crisis and youth unemployment: Comparing Greece and Ireland

Both Greece and Ireland have long suffered high youth unemployment rates and have been pressured to restructure their employment and social systems under the European Employment Strategy. Problems were aggravated by the harsh conditions imposed by the Troika following bail-outs. Yet there was significant divergence in youth employment outcomes between Greece and Ireland despite a convergence of policies. In Ireland, tighter conditionality of benefits and stronger ‘activation’ were already on the agenda of the social actors, so their implementation was not forcefully contested. In Greece, the lack of effective social protection made it difficult for successive governments to build support for flexibilization, and the escalating insecurity of young Greeks and their families gave rise to social unrest and political instability. This contrast leads to a reappraisal of the convergence–divergence debate.

Distinctiveness of human resource management in the Asia Pacific region: typologies and levels

With this special issue, we explore the distinctive contextual factors of contemporary human resource management (HRM) in the important Asia Pacific region, in order to contribute new and non-Western insights to the convergence-divergence debate in international HRM. After first establishing a multi-level analytical framework consisting of macro-, meso-, and micro levels, we discuss theoretical trends at each stage which reveal that countries at different developmental stages possess distinctive political-economic frameworks, institutions, cultural features, and value systems. We present four studies that analyze the distinctive features of the respective cultural contexts. These include (1) yongo and informality in HRM in Korea, (2) guanxi in the context of performance appraisal in Western and local banks in China, (3) relationship building by leaders in China and the US, focusing on the role humor plays therein, and, (4) human factors in virtual teamwork with examples from Taiwan, Vietnam, and Indonesia. We draw two major conclusions from our investigation. As HRM systems in the Asia Pacific region are rather heterogenic, we see no trend toward global convergence. Rather, we perceive local systems ‘mixing’ best practice approaches, and that as a result are hybrids. Others tend to diverge. We propose the distinctiveness of HRM in the Asia Pacific region, as revolving around the themes of social ties, informality, and interpersonal trust. Future research could focus on these broad themes in order to understand their respective dynamics better and make HRM systems more efficient and effective.

Convergence-divergence of HRM in the Asia-Pacific: Context-specific analysis and future research agenda

In this article, we highlight the significance and need for conducting context-specific human resource management (HRM) research, by focusing on four critical themes. First, we discuss the need to analyze the convergence-divergence debate on HRM in Asia-Pacific. Next, we present an integrated framework, which would be very useful for conducting cross-national HRM research designed to focus on the key determinants of the dominant national HRM systems in the region. Following this, we discuss the critical challenges facing the HRM function in Asia-Pacific. Finally, we present an agenda for future research by presenting a series of research themes.

Convergences and divergences of public sector reform in Bhutan: dynamics of incremental and transformational policies

The convergence-divergence debate in public sector reform is ongoing, with evidence of both trajectories being prevalent empirically. Convergence-divergence at the start of the reform trajectory examines the similarity of the contents and the objectives of the reforms compared to best practices; and convergence-divergence at the end point examines the similarity of the outcomes of the reforms with their objectives. This article considers the convergence-divergence debate in public sector reform and examines when convergence and divergence occur along the reform trajectory. In doing so, the article uses as a case study the implementation of the position classification system (PCS) which was introduced in Bhutan in 2006. The PCS comprises a bundle of reforms that can be categorised as incremental and transformational. The experience of the PCS highlights the dynamics of incremental and transformational reforms, and explains why transformational reforms often lead to divergence. The article, in using a case study of a country that is relatively understudied, contributes to the extant literature on comparative public administration. It extends what is known about the convergences and divergences of public sector reforms by highlighting the importance of institutional and cultural contexts in the implementation of transformational reforms.

The informal dimension of human resource management in Korea: Yongo, recruiting practices and career progression

This research reports on the influence of informal social networks in Korea (i.e. Yongo) on recruitment and promotions practices of large, small and medium-sized enterprises (SMEs). By using a social network theory frame, this research contributes to the convergence–divergence debate in International Human Resource Management. From our analysis, we can conclude that large firms use Yongo and related practices on the upper management level, whereas SMEs draw on informal social networks on middle and upper management level. The influence of Yongo is weakened by the recent need for skillful employees with specialized competencies. We regard Korean HR practices as being in a state of ‘soft divergence’ because Yongo still represents an influential factor in HR practices. Moreover, we refer to the debate on the persistence of informal relationships in East Asia by demonstrating that Yongo is a rather culturally driven institution; hence, we assume that it may persist and not diminish any time soon. Finally, implications for practice are drawn by outlining the difficulties expatriates face without being able to establish Yongo-based ties and propose solutions.

Intellectual Property Rights Access to Genetic Resources and Indian Shrimp Aquaculture: Evolving Policy Responses to Globalization

Globalization of the aquaculture industry raises important questions regarding the means to ensure a balance between intellectual property rights (IPRs) and access to resources. Advocates of IPRs endorse convergence towards implementing Trade‐Related Aspects of Intellectual Property (TRIPs) agreement as a method for promoting innovation, while others support divergence from global standards in order to uphold access to resources. This study analyzes the impact of the convergence–divergence debate on IPRs and access to resources in India's shrimp aquaculture sector. The Indian shrimp sector is at a crucial juncture, moving towards greater globalization and integration with international markets, along with the introduction of new species, new technologies and an increasing role for foreign companies. India requires access to foreign‐improved breeding material and technology, but must also create incentives for companies and institutions to invest in genetic material. In response to globalization, India's policy demonstrates both convergence and divergence with global standards. This paper outlines the policy options for India and points out that India's policy choices need not be restricted to one model, but can be based on innovative strategies to ensure a balance between IPRs and access over aquatic resources.

Organizational citizenship behavior in Chinese society: a reexamination

Organizations in emerging economies such as China have attracted an increasing amount of research attention during the past few decades, and it is time to scrutinize findings from earlier studies. In this paper, we test the psychometric soundness of a widely used indigenous measure of organizational citizenship behavior in the Chinese context developed by Farh, Earley, and Lin ((1997), ‘Impetus for Action: A Cultural Analysis of Justice and Organizational Citizenship Behavior in Chinese Society,’ Administrative Science Quarterly, 42, 421–444). Using multiple samples from Mainland China, we performed systematic tests of the content validity, discriminant validity, factorial validity and nomological validity of this five-dimension measure. We found that their two culture-specific dimensions, namely (harm to interpersonal) harmony and (personal use of organizational) resources, in fact measure the construct of deviant behavior, and cannot prove the existence of indigenous contents. We discuss our results in light of the ongoing convergence–divergence debate, and provide suggestions to further improve the quality of indigenous research.

Global Networks and Domestic Policy Convergence: A Network Explanation of Policy Changes

National economies are embedded in complex networks such as trade, capital flows, and intergovernmental organizations (IGOs). These globalization forces impose differential impacts on national economies depending on a country's network positions. This article addresses the policy convergence-divergence debate by focusing on how networks at the international level affect domestic fiscal, monetary, and regulatory policies. The author presents two hypotheses: first, similarity in network positions induces convergence in domestic economic policies as a result of peer competitive pressure. Second, proximity in network positions facilitates policy learning and emulation, which result in policy convergence. The empirical analysis applies a latent-space model for relational/dyadic data and indicates that position similarity in the network of exports induces convergence in fiscal and regulatory policies; position similarity in the network of transnational portfolio investments induces convergence in fiscal policies; and position proximity in IGO networks is consistently associated with policy convergence in fiscal, monetary, and regulatory policies.

Cultural Hybridization: A Third Way Between Divergence and Convergence

The convergence–divergence debate on whether business cultures are growing alike or not has become an important part of studies of the influence of national cultures on the operation of firms. This article intends to formulate a third way, a third model, by creating synergy between the model of cultural hybridization and Social Integration Theory. We contend that cultural hybridization takes place in multicultural joint ventures but this process happens unevenly and in different parts of the venture. The new model, itself a product of hybridization, is illustrated with examples from Chinese and Indian joint ventures.

The transfer of organizational practices: a diachronic perspective from China

Extensive research has been undertaken on the transfer of organizational practices by multinational firms (e.g. Morgan, Kristensen and Whitley 2001; Ferner, Quintanilla, and Sánchez-Runde 2006). However, little investigation has assessed the role that time plays in this process. The commonplace theoretical assumption is that as their overseas subsidiaries become more embedded in the local environment they increasingly take on the practices that prevail locally (Rosenzweig and Nohria 1994; Farley, Hoenig and Yang 2004). There have, though, been few longitudinal studies that would allow the veracity of this assumption or its implications to be assessed; most studies provide one-off, synchronic ‘snapshots’ of organizations. Drawing upon research conducted at a UK-owned retail firm in China between 1999 and 2005, this paper provides a diachronic perspective that can trace emergent trends. Data are derived from mixed methods: 140 interviews with expatriate managers and local staff from all levels of the hierarchy, a three month period of ethnographic research and a total of 305 survey questionnaires. Comparison between findings from the more recent research and those based upon the earlier research suggests that time does play a role in affecting transplanted organizational practices. We report that in some respects the organizational practices of the firm in question increasingly took on more of the ‘colour’ of those that prevailed in the host environment. However, convergence with local practices was far from total, some practices bear increasing resemblance to the firm's parent country operation. We also caution that it is difficult to disentangle the isomorphic influence of the passage of time from factors such as the rapid withdrawal of expatriate managers from the operational level and the impact of the firm's rapid expansion across China. Moreover, we suggest that the local–global dichotomy, upon which much of the convergence–divergence debate rests, is perhaps increasingly problematic.

Corporate Governance Reform as Institutional Innovation: The Case of Japan

To address the convergence-divergence debate in corporate governance, we conduct a multiple-case, multiple-level study to analyze the diffusion of governance innovation in Japan. We argue that Japanese systems of corporate governance neither fully converge to, nor completely diverge from, the Anglo-American model. Rather, Sony—the pioneer of corporate governance reforms—and its followers selectively adopted features from this model, decoupled them from the original context, and tailored them to fit to their own situations to generate governance innovation. However, we find that the spread of innovation across firms and institutional levels is far from linear and straightforward, and that other well-regarded firms raised strong opposition to the institutionalization of corporate governance reforms. Eventually, the Ministry of Justice revised the Commercial Code to legitimize different systems, which led to the emergence of diverse corporate governance practices.Based on the results of our study, we construct an analytical framework to examine innovation diffusion in light of conflicting institutional pressures for change and continuity. Our analysis adds complexity to the convergence-divergence debate by identifying the creation of hybrid corporate governance systems and the nonlinear evolution of such systems as a result of interactions across multiple levels. We show the various degrees of decoupling from the Anglo-American model and identify the antecedents. We then extend the conventional focus of innovation research on diffusion across firms to examine diffusion across institutional levels. We also contribute to institutional theory by offering insights into organizational field formation and the conceptualization of the state in shaping institutional change and continuity.

Internationalization as a determining factor of HRM outsourcing

This paper examines the effect of company internationalization on the practice of outsourcing HRM functions in Greece. It holds the assumption that HRM outsourcing is perceived as an innovative practice and that foreign multinationals (MNCs) will use this practice more than native ones do. In doing that, the study aims at examining whether ‘diffusion’ of loosely- regulated management practices such as HRM outsourcing, is sustained by foreign multinationals. The findings of the 2000 CRANET survey are presented to show that HRM outsourcing is used to a lesser extent in Greece than other Western economies. Then the hypothesis that MNCs outsource more HRM services than Greek companies do is tested. The analysis draws upon the findings of a survey addressed to HR directors of both foreign multinationals and Greek companies. A significant difference is found in the extent of HRM outsourcing between Greek companies and foreign multinational subsidiaries. This is adequately explained through the comparison of the way HRM is conducted in Greek each type of company, as well as the segregation of the Greek market for HRM services. The paper adds to the discussion on the role of multinationals in the diffusion of innovative managerial practices, as well as to the HRM convergence–divergence debate.

Beyond the Convergence–Divergence Debate: The Role of Spatial Scales in Transforming Organizational Logic

Studies of organizational globalization typically assume that space is progressively ‘overcome’, resulting in the convergence of organizational logics, or that organizations continue to be embedded within the space of the nation state, resulting in divergent organizational logics. I argue that organizational logics are transformed as they move across space. Transformations in organizational logic are also underpinned by changes in space. I use the concept of spatial scale to theorize changes in space. I argue that spatial scales are multiple spatial levels that are produced through three interconnected processes: capital accumulation, regulation and articulation of discourse. Organizational logics are typically positioned on a number of spatial scales at once. The transformation of organizational logic is underpinned by processes of rescaling and resistance involving the political contestation of scale. I conclude by reflecting on what contributions the concept of scales makes to studies of the transforma...