How does the transfer of human resource practices take place from Finnish Multinational Corporation to a Swedish subsidiary? A case study of transfer and harmonization of HR practices within a medium-sized family-owned MNC

Abstract

This master thesis is both a contribution to the academic and practical field of human resource management; with an explanatory case study to explain how the transfer of human resource practices takes place from Finnish MNC to its subsidiary in Sweden. Earlier studies demonstrate that planned transfers of management practices from MNCs headquarters to foreign subsidiaries are not always successful. This is often due to the fact that foreign subsidiaries often operate in different institutional environment and the social dimension of the harmonization of the practices is neglected. This master thesis will focus on these three aspects by using different theoretical lenses. Neo-institutional theory is used to analyse the subsidiary’s institutional environment and social capital theory is used to explain the cognitive dimension of practice transfer. By combining these two theoretical lenses this thesis has a conceptual framework. Methodological tool for this thesis include the use of qualitative case study and semi-structured interviews to be able to provide information that enters through the organizational surface in order grasp more holistic understanding of the problem. Results indicate that the transfer of HR practices is indeed a social process and as foreign subsidiaries operate in different institutional environments it is important to understand these differences both in country and industry levels.