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South Korean MNEs’ international HRM approach: Hybridization of global standards and local practices Chul Chung a,* , Paul Sparrow b,1 , O¨ du¨ l Bozkurt c,2 aHenley Business School, University of Reading, Whiteknights, Reading RG6 6UD, UK bLancaster University Management School, Lancaster LA1 4YX, UK cDepartment of Business and Management, University of Sussex, Falmer, Brighton BN1 9QF, UK 1. Introduction Over the last two decades, the issue of the global standardiza- tion versus localization of subsidiary-HRM practices has been a central debate in the literature on human resource management (HRM) of multinational enterprises (MNEs) (Festing, Knappert, Dowling, & Engle, 2012; Pudelko & Harzing, 2007). Extant research on the issue has mainly focused on MNEs based in developed economies such as the U.S., European countries, and Japan (Thite, Wilkinson, & Shah, 2012). Recently, there has been a growing interest in various aspects of the activities of a ‘‘second wave’’ of MNEs from emerging economies (Bonaglia, Goldstein, & Mathews, 2007) such as, Brazil, China, India, Mexico and Russia as they grow in number and size. As attention shifts to emerging markets, there are important research questions that should be investigated, particularly in MNEs from newly industrialized economies (e.g., South Korea, Singapore, and Taiwan). Although the size of newly industrialized economies is smaller than that of major emerging economies, foreign direct investment (FDI) from newly industrial- ized economies is still growing, and unlike MNEs from emerging markets, there are a signiﬁcant number of MNEs from among thesethat occupy leading positions in their global markets (Filatotchev, Strange, Piesse, & Lien, 2007; UNCTAD, 2006).

This study explores South Korean MNEs’ approach to subsidi- ary-HRM practices. Research on Korean MNEs could have implications to wider groups of MNEs. First, Korean MNEs compete successfully in global markets against MNEs from developed economies and they are widely considered to be exemplars of successful MNEs from newly industrialized economies (UNCTAD, 2006). Some Korean MNEs are large, with a wide geographical reach in multiple subsidiary locations around the world and in leading positions in their respective sectors. In other words, these MNEs resemble and therefore are directly comparable with their counterparts based in developed economies in terms of size, global presence, and position in the global market. Secondly, at the same time, as their home country lacks a dominant status in the world economy, they might experience a ‘‘liability of origin,’’ which refers to the distinctive challenges or disadvantages stemming from their national origins (Bartlett & Ghoshal, 2000; Chang, Mellahi, & Wilkinson, 2009; Chung, Bozkurt, & Sparrow, 2012; Glover & Wilkinson, 2007; Ramachandran & Pant, 2010). Hence under- standing the current state of their international HRM reveals insights, not just for subsequent cohorts of MNEs from newly industrialized economies and emerging markets, but also for the general domain of contemporary MNEs in general. We argue it is particularly important to see whether South Korean MNEs adopt a distinctive approach to subsidiary-HRM practices, which may call into question the current dominant assumptions about HRM strategy and practice in MNEs, as these assumptions are Journal of World Business 49 (2014) 549–559 A R T I C L E I N F O Article history:

Available online 1 January 2014 Keywords:

International human resource management Korean Multinational Enterprises (MNEs) Hybridization Liability of origin A B S T R A C T This paper analyses the international Human Resource Management (HRM) approaches of Korean Multinational Enterprises (MNEs). Through a study of nine major Korean MNEs’ approaches to subsidiary-HRM, it is argued that the ﬁrms pursue hybridization through a blending of localization and global standardization across detailed elements in ﬁve broad HRM practice areas. Local discretion is allowed if not counter to global HRM system requirements and ‘‘global best practices’’ used as the template for global standardization of selected HRM elements. This strategic orientation appears to be part of a deliberate response to the ‘‘liabilities of origin’’ born by ﬁrms from non-dominant economies.

E-mail addresses: [email protected] (C. Chung), [email protected] (P. Sparrow), [email protected] (O¨ . Bozkurt). 1Tel.: +44 1524 510911. 2Tel.: +44 7748 297948. Contents lists available at ScienceDirect Journal of World Business jo u r nal h o mep age: w ww.els evier .co m/lo c ate/jwb 1090-9516/$ – see front matter 2013 Elsevier Inc. All rights reserved.

http://dx.doi.org/10.1016/j.jwb.2013.12.008 predominantly informed by what is known about MNEs based in developed countries. An understanding of how South Korean MNEs approach their global people management is critical to debates on the possible emergence of an ‘‘Asia Paciﬁc model of HRM’’ (Dowling & Donnelly, 2013, p. 172).

We present the ﬁndings of a study that examines parent companies’ approach to subsidiary-HRM practices of nine Korean MNEs, all of which enjoy internationally competitive positions in their respective sectors. The major part of study is based on thirty interviews with HR executives and senior managers from the corporate headquarters directly responsible for the development and implementation of the IHRM strategy in the ﬁrms. As one part of the interview process, we used a structured-interview instru- ment designed to examine the different orientations toward global standardization and localization at the detailed element level within each of ﬁve HRM practice areas across the nine MNEs (job and grade, recruitment and selection, training and development, performance management, compensation and beneﬁts). In total we gathered data on each of forty-seven elements about which decisions needed to be made with regard to global standardization or localization: nine for job and grade system, six for recruitment and selection, six for learning and development, sixteen for performance management, and ten for compensation and beneﬁts.

In our ﬁndings, we show that the IHRM approaches of the Korean MNEs are best captured by a distinctive approach of hybridization across these elements of individual HRM practices, rather than more wholesale orientations of ‘‘global standardization’’ or ‘‘localization’’.

The remainder of the paper is structured as follows. First, we present the currently dominant understanding and assumptions in research on the IHRM strategy of MNEs. After a discussion of our research methodology and an introduction of the case organiza- tions, the empirical ﬁndings are presented. We then offer an interpretation of the ﬁndings with reference to existing theoretical assumptions, and conclude with a discussion of the contribution of the study and its limitations, as well as suggestions for future research.

2. International HRM strategy in the literature: dominant assumptions and new challenges One of the key issues in the practice of IHRM is the need to manage the dual pressures of global integration and local responsiveness (Brewster, Sparrow, & Harris, 2005). Research on the issue has examined the degree of global integration or local responsiveness in IHRM (see for example Bjo¨ rkman & Lervik, 2007; Brewster, Wood, & Brookes, 2008; Chung et al., 2012; Evans, Pucik, & Barsoux, 2002; Farndale & Paauwe, 2007; Farndale, Brewster, & Poutsma, 2008; Rosenzweig, 2006). It has also begun to distinguish the use of particular mechanisms in IHRM integration (Smale, Bjo¨ rkman, & Sumelius, 2013). Much empirical study in the area is underpinned by the integrative IHRM model of Taylor, Beechler, and Napier (1996), which argues that an integrated approach regarding IHRM strategy and practices has to distinguish the corporate-wide level from that of afﬁliates, and also from the employee-group level. Given that our main interest is in company- wide IHRM strategies, we also work with this deﬁnition of IHRM strategy, even while we recognize there may be more than three abstract orientations or routes to globalization of HRM. Accord- ingly, we deﬁne IHRM strategy as the general approach or orientation taken by an MNE ‘‘in the design of its overall IHRM system, particularly the HRM systems to be used in its overseas afﬁliates’’ (Taylor et al., 1996, p. 966).

Three key assumptions have been dominant in research on orientations to IHRM strategy. First, the degree of standardization (versus localization) of subsidiary-HRM practices has beenconsidered as a key dimension underlying different orientations in IHRM strategy (Brewster et al., 2008; Dickmann & Mu¨ ller- Camen, 2006; Pudelko & Harzing, 2007). Taylor et al. (1996) identiﬁed three generic IHRM orientations at the corporate-level of MNEs: exportive, whereby corporate HR actors attempt to transfer parent company’s HRM system to subsidiaries; adaptive, whereby they attempt to adapt subsidiary HRM system as much as possible to the local context; and integrative, in which ‘‘the best’’ approaches are sought from parent and subsidiary practices. In most empirical IHRM research, the degrees of standardization as an integration mechanism has been examined by assessing the similarity between parent and subsidiary ﬁrm practices (e.g.

Bjo¨ rkman, 2006; Brewster et al., 2008; Rosenzweig, 2006).

Second, previous studies have typically examined the degree of standardization either at the overall practice level (e.g. perfor- mance management, recruitment and selection, compensation, etc.) or the level of entire HRM functions, through the use of measures that aggregate ratings on the degrees of standardization for individual HRM practices (Bjo¨ rkman, 2006). For example, a pioneering study on HRM practices of MNEs by Rosenzweig and Nohria (1994) examined whether subsidiary-HRM practices were similar to parent’s or local practices in each of six HRM practice areas such as employee beneﬁts, annual time off, variable compensation for managers, and so forth. Research has increas- ingly looked at the implementation of particular HRM practices, for example talent management (Hartmann, Feisel, & Schober, 2010) or global performance management (Festing, Knappert, Dowling, & Engle, 2012) in different subsidiary locations. Importantly, while standardization may be implemented across a speciﬁc element of an individual HRM practice, the approach toward another element of the same practice at the same time may be deﬁned by localization (Brewster et al., 2005). For example, an MNE in the energy sector mapped a set of generic HR processes by breaking these down into detailed elements and revamping the country role around each process to establish a new HR system architecture.

Decisions were made as to whether to allow local aberrations from the globally designed process on a detailed element-by-element basis in each HRM practice (Sparrow, Brewster, & Harris, 2004).

The third dominant assumption is that in attempts to standardize HRM processes, parent-company practices are the major reference, in line with the aforementioned orientations of IHRM strategy (see e.g., Bartlett & Ghoshal, 1989; Bjo¨ rkman, 2006; Rosenzweig, 2006). This is evident in the widespread tendency to treat similarity of practices between parent company and subsidiaries as a key indicator of global integration of HRM within IHRM research (Hannon, Huang, & Jaw, 1995; Kim & Gray, 2005; Rosenzweig, 2006; Rosenzweig & Nohria, 1994). The use of parent practices as the major reference of standardization reﬂects MNEs’ taken-for-granted views on effective HRM practices, the embedd- edness of their practices in their home countries (e.g. Bjo¨ rkman, 2006) or their ‘‘administrative heritage’’ (Bartlett & Ghoshal, 1989; Taylor et al., 1996).

However, the dominant assumptions above have been chal- lenged by more recent scholarship, which depicts a more complex picture in IHRM. Regarding the ﬁrst and second assumptions, several recent studies show that the constitution of IHRM strategy and practices could be far more nuanced and complex than the rather simplistic framework that the degree of standardization versus localization suggests. For example, work by Edwards and colleagues highlights that a number of complex patterns of transfer, negotiation, and combination of practices exist in the process of globalizing HRM (Edwards, 2011; Edwards, Jalette, & Tregaskis, 2012; Edwards & Rees, 2008; Edwards & Tempel, 2010).

In a detailed case study of Japanese multinational retail ﬁrms, both in their home country and in their subsidiaries in China, Gamble (2010) ﬁnds that the construction of subsidiary-HRM practices in C. Chung et al. / Journal of World Business 49 (2014) 549–559 550 MNEs is too complex a phenomenon to be explained by the traditional standardization versus localization continuum. In order to capture the complexity of IHRM, Gamble proposes the concept of ‘‘hybridization’’, which involves complex patterns of creating new management practices through simultaneous processes of highly selective adoption, transfer, and local adaptation. Other research by Sparrow and colleagues on HR globalization within western MNEs makes a distinction between standardization and optimization to capture the more nuanced and detailed approach MNEs adopt in their IHRM strategy (Brewster et al., 2005; Sparrow et al., 2004). Standardization occurs when HRM processes designed at headquarters are applied to country operations either formally or tacitly based on the expectation of performance beneﬁts, as seen by corporate headquarters (Martin & Beaumont, 2001). Optimiza- tion involves the discipline of adjusting a process based on multiple viewpoints so as to obtain a particular goal by setting or optimizing a speciﬁed set of parameters without violating some core constraints. Case studies examining the globalization of HR functions at the element level in western MNEs reinforce this emerging view through the investigation of areas such as international recruitment (Sparrow, 2007), the evolution of international mobility functions (Sparrow, 2012) and the devel- opment of global talent-management processes (Garavan, 2012; Sparrow, Farndale, & Scullion, 2013).

Regarding the third assumption, questions have also been raised about the most appropriate locus of reference for potential standardization. Pudelko and Harzing (2007) note that practices from outside the organization, such as ‘‘global best practices’’ that do not necessarily originate from the parent company may be utilized as a reference for standardization. In this paper we argue that IHRM research needs to adopt a broader frame of reference when considering the origin of practices for standardization. This broadening also demands far more sophisticated methodologies than have typically been used in related research.

The dominant assumptions in the extant research on IHRM strategy become problematic in the distinctive context of the emerging MNEs, such as South Korean MNEs. These ﬁrms might not be driven by the same assumptions about the globalization of their HRM. MNEs from developed countries often claim legitimacy in the transfer of parent-company practices to subsidiaries, presenting them as ‘‘advanced practices’’ and a source of competitiveness, corroborated by the global status of the home country. MNEs from home countries that lack such claims to legitimacy might not attempt the same approach to globalization of their practices. First, they may be more sensitive to diverse institutional pressures and reluctant to transfer home country practices to subsidiaries because of such perceived shortcomings (Bartlett & Ghoshal, 2000; Chang et al., 2009; Smith & Meiksins, 1995). Second, the practices that exist in the parent company or home country might not be mature because of limited heritage and experience in conducting global business (Cuervo-Cazurra &Genc, 2008; Dunning, Kim, & Park, 2008; Luo & Tung, 2007; Ramachandran & Pant, 2010). South Korean MNEs, and by extension MNEs from other newly industrialized economies, may challenge some dominant assumptions within current IHRM debates.

This paper addresses the following central research questions: - RQ1: What is the overall orientation in Korean MNEs’ approaches to subsidiary-HRM practices in terms of global standardization and localization? - RQ2: At which level do Korean ﬁrms intend to standardize subsidiary-HRM practices? - RQ3: What is the origin of practices for standardization in Korean MNEs’ approaches to subsidiary-HRM practices?

3. Methodology A multiple-case study method was adopted in this study as appropriate for the investigation of the similarities among Korean MNEs in their corporate IHRM strategies. Nine major MNEs were included in this comparison. The case companies were selected based on (1) accessibility, (2) public awareness of their ‘‘Global HR’’ activities and (3) representativeness in their sectors in terms of ﬁrm size. Though one cannot generalize the ﬁndings in this study based on the small number of cases to the larger population of Korean MNEs, the nine ﬁrms captured a considerable range of sectors, including automobiles, electronics, steel, industrial wire and cable, infrastructure building, IT services, cosmetics, and confectionary. Crucially for the study at hand, all nine ﬁrms included in the study had very concrete, focused, and active globalization strategies, which included HR functions. The proportion of revenues generated overseas spanned a range from the mid-teen percent to over eighty percent. Total sales likewise spread across a wide range (see Table 1). This, of course, suggests that variables such as the percentage of revenues generated from overseas or total sales might moderate the overall results we report. As companies’ efforts for globalizing HRM were mainly focused on white-collar employees, our research only includes their approaches to subsidiary-HRM practices for this segment of employees.

To gain a basic understanding of each company, a range of documents was collected and reviewed, including annual reports and company proﬁle documents. Primary data for analysis were collected through thirty interviews with thirty-one key infor- mants. In each company interviews were arranged through an initial key contact, a HR manager in a corporate HR team. Each interview was conducted on a one-to-one basis except one interview that was carried out with two interviewees. Twenty- nine interviewees (between two to ﬁve interviewees for each of nine companies) were HR executives and HR senior managers at Table 1 Proﬁle of case study companies.

ID no. Company Industry Total sales (billion USD)Proportion of sales abroad (%) Number of employees/ % of employee abroad 1 AutoCo Auto 55.1 75 124,000/30 2 ElecCo1 Electronics 135.7 83 190,000/50 3 ElecCo2 Electronics 48.2 85 93,000/65 4 SteelCo Steel 53.2 39 27,000/37 5 CableCo Wire and cable 6.8 70 8050/70 6 ConfCo Confectionery 1.1 52 5900/63 7 EbizCo Online game 0.6 36 3300/27 8 CosmeCo Cosmetics 1.8 16 8600/48 9 InfraCo Heavy equipment 21.6 55 38,000/47 Annual reports (2010), company websites, interview.C. Chung et al. / Journal of World Business 49 (2014) 549–559 551 the corporate headquarters of the nine MNEs. They were key informants who were directly responsible for the development and implementation of IHRM strategy, including activities associated with globalizing HRM at the ﬁrm level. The purpose of using multiple interviewees was to capture a holistic picture of the company’s approach to subsidiary HRM practices, as a single interviewee may have been unable to answer all of the questions given the wide range of information sought at the organizational level. Thus interviews in a given case company were largely complementary to each other. When there were multiple responses to a question from different interviewees in a company, we checked on consistency and found those responses tended to be highly congruent with each other and the congruent responses were adopted in the data analysis. Non-congruent responses are noted as competing explanations or caveats to our ﬁndings. Given the focus of questioning was on each company’s approach and its policy-design intent, this was to be expected. Additionally, to gather information regarding general trends in global HR activities in South Korea, two interviews were conducted with directors of the Seoul ofﬁces of two international HR consultancies, which had been and were, at the time of research, involved in multiple Global HR projects with a large number of Korean MNEs. Interviews were carried out at the interviewees’ workplaces and each interview lasted from one to one and a half hours. All interviews were tape- recorded and transcribed.

Interviews carried out for the study were of two types. Where the focus was on the investigation of emergent phenomena, interviews were semi-structured. Where the focus was on the collection of detailed data so as to allow for the analysis of element-level practices across the nine MNEs in the study, a more structured approach was adopted. In practice, this meant that interviews with informants about the overall corporate IHRM strategy and the activities associated with globalizing HRM, as well as the justiﬁcations offered for the pursuit of these particular directions in IHRM strategy, were semi-structured. Interviews with the structured-interview instrument that solicited data for the analysis of an individual ﬁrm’s orientations at the element level of IHRM practices, categorized as globally standardized (following globally common standards), localized (allowing subsidiary discretion to respond to local needs), or modiﬁed (allowing local modiﬁcations on the global standards), were structured. Method- ologically, our two-pronged approach was best suited to pursue further the suggestions in previous literature that globalization can happen at the detailed element level in HRM practices (Rosenz- weig, 2006), remedying the tendency in much of the extant literature only to investigate this at the broad practice level.

The semi-structured interview topics included descriptions of IHRM strategy, speciﬁc IHRM initiatives and the reasons for the pursuit of given IHRM strategies. Every interviewee in the nine ﬁrms was asked about these general strategic themes. The structured-interview instrument solicited data about ﬁve broad HRM practice areas that have widely been identiﬁed as core areas of practice in previous research (Huselid, 1995; Youndt, Snell, Dean, & Lepak, 1996): job and grades, recruitment and selection, learning & development, performance management, compensa- tion and beneﬁts. It entailed data at the detailed element level of practices within each of these practice areas. For example, the general HRM area of performance management was expanded to comprise sixteen elements, such as performance evaluation factors; performance measurement items; weighting of evaluation factors; performance-rating scale and so on (see Table 2). The list of forty-seven elements representing generic design elements of the ﬁve HRM practice areas were identiﬁed in an earlier study (Chung et al., 2012) with two Korean MNEs (AutoCo and ElecCo2) which also participated in this study. Both companies already had a series of elements of HRM practices in their global HRM guidelines.Common elements were identiﬁed by comparison between the two companies and a generalizable element list was developed.

The respondents could answer the instrument without difﬁculties and the list of elements in the instrument covered their HRM practices comprehensively. Such detailed data collection at the level of elements was essential given our stated purposes, as it made it possible to refrain from a priori assumptions about the existence of a universal and homogenous orientation in the strategies across different HRM practice areas. It also enabled a systematic comparison across the ﬁrms.

For the structured-interview part, one interviewee for each company was identiﬁed by key contacts as the most appropriate informant who had been involved in the development of corporate guidelines for subsidiary-HRM practices. This individual was ﬁrst asked to respond to the structured-interview instrument as well as the semi-structured interview questions. Most interviewees could respond to the instrument without difﬁculty, offering explanations of why their companies adopted the particular approaches to subsidiary HRM. In two companies (AutoCo; ElecCo2), two interviewees were separately involved in responding to the instrument, as one could not answer questions in all the categories in the instrument due to the respondent’s scope of job responsibilities. The results of initial responses to the instrument by one or two interviewees were then reviewed by another respondent. In most cases they were conﬁrmed without disagree- ment, but in a few cases the initial responses were amended in the following interviews as it became apparent that there had been misunderstandings of categories in the instrument by the former interviewees.

The data analysis followed four steps. The ﬁrst step coded the structured-interview data for each company regarding parent companies’ guidelines for subsidiary-HRM practices. As the data collection described earlier was highly structured, it could be coded in a straightforward manner. The results are shown in Table 2. In the second step, the semi-structured interview data for each interviewee were coded for accounts regarding: (1) the parent company’s approach to subsidiary-HRM practices, and (2) the rationale or reason for adopting the approach. Pre-deﬁned coding categories were used for IHRM strategy and inﬂuencing factors on this strategy. Each selected interview account in each category was then coded using labels that summarized key notions in the interview account. The codes were then classiﬁed into higher-level codes through inductive reasoning. These codes were provisional and subject to re-coding if signaled by the subsequent company- level analysis. The third step focused on analyzing the coded individual data at the company level. After aggregating the results of coding the semi-structured interview data at company level, each initial higher-level code was re-examined across interviewees for each company and reﬁned to reﬂect common views across interviewees. When necessary, more abstract constructs were identiﬁed and coded. After reﬁning provisional codes, the coded results of the semi-structured interview data were reviewed alongside those of the structured-interview data. Key features of the parent company’s approaches to subsidiary-HRM practices and the rationales behind these approaches were identiﬁed for each company, based on the understanding that had been gained through the coding process. In the fourth step, the common or distinctive patterns in company-level approaches to subsidiary- HRM practices and the rationales of these approaches were examined across companies. The key ﬁndings in relation to the research questions were drawn from this comparative analysis.

Given that our focus is to examine parent companies’ approaches to subsidiary-HRM practices, the reports from inter- viewees in headquarters need to be veriﬁed through examining whether such approaches are actually recognized and implemen- ted in each subsidiary. We tied reports from headquarters C. Chung et al. / Journal of World Business 49 (2014) 549–559 552 regarding subsidiary HRM practices to the actual practices implemented in the six subsidiaries of one MNE to demonstrate the validity of our ﬁndings.

It would be beyond the scope of a single qualitative study to investigate all subsidiaries of the nine companies. However, we conducted supplemental research with six subsidiaries of an MNE to examine the ﬁt with the reports from headquarters-level interviews. This company was selected because it showed most of the common patterns identiﬁed as important across the nine ﬁrms in the parent companies’ approach to subsidiary-HRM practices and we could control and match the functions served by its subsidiaries. Among the six subsidiaries, three subsidiaries are located in India and the other three are located in the U.S., againenabling multiple site comparisons within a single country. The three subsidiaries in each host country include a sales ofﬁce, a manufacturing plant, and a research and development center. The level of economic development of a host country and the function of a subsidiary were identiﬁed in the initial study at the corporate level as important factors that could lead to different patterns in the implementation of parent ﬁrms’ policies regarding subsidiary HRM. Thirty-six interviews were conducted across the six subsidiaries. To capture the state of implementation of subsidi- ary-HRM practices, ﬁve to seven interviewees in a subsidiary, including local HR managers, an HR expatriate, the head of the subsidiary and two to three line managers, were included in the study. Interviews were conducted on a one-to-one basis. In each Table 2 Summary of global HRM guidelines of the case companies.

Component of HRM practices in MNEs 1–9 1a 2 3 4 5 6 7 8 9 Job and grade Job classiﬁcation: job family Gb G G M M M M G M Job classiﬁcation: job list G G Mb M M M M M L Job description: category Lb L M M L L M G G Job description: content L L M M L L M M M Grade: number G G G G M L M G G Grade: criteria/deﬁnition G G M G M L M G G Grade: title G L M L M M M G M Promotion: requirement/criteria G L M M M L M G M Promotion: process L G L M M L M M M Recruitment and selection Recruiting methods L G L M L L M M M Recruiting message L L L M M L L L L Selection: criteria M L L M M L M L M Selection: assessor M L L M M L M L L Selection: process L G L M M L M L M Selection: assessment tools L L L M M L L L M Learning and development Succession planning: executive pool G G G M G M L M G Succession planning: high potential talent L G G M G L L M G Learning program: leader G G G G G L L M L Learning program: Common competency G G G G G M G M G Learning program: profession/job related L L M M M L L M L Learning delivery/operation M L M M M L L M L Performance management Performance evaluation factor G G G L G M G G G Performance measurement item L M M L M M M M M Weighting of evaluation factors G G G L M M G M M Performance rating scale G G G L M M G M L Forced distribution M G G L M M G M L Evaluation cycle/frequency G G G L M M M M G Performance management process G G G L M M M M M Performance evaluation assessor L M M L M M M M L Performance management form L G G L M M G M M Linkages to other HR applications L G G L G M M M M Common competency G G G L L L G M G Leadership competency G G G L G L L M G Job skill/competency L L G L M L L M L Competency assessment process G L G L M L M M G Competency assessor L L G L M L M M G Competency assessment rating scale G L G L M L G M G Compensation and beneﬁt Employee pay structure L G G L M M L G L Employee base pay range L L L L L L L M L Employee base pay increase M M L L L L L M L Employee Incentive L L M L M L L M L Executive pay structure L L G L M G M M G Executive base pay range L L G L L G M M M Executive base pay increase L L G L L G M M M Executive Incentive L L G L M G M M M Beneﬁt: employee L L L L L L L M L Beneﬁt: executive L L G L L M L M L aCompany ID number. bG: globally common (following globally common standards); M: modiﬁed (allowing local modiﬁcations on the global standards); L: localized (allowing subsidiary discretion to respond to local needs).C. Chung et al. / Journal of World Business 49 (2014) 549–559 553 subsidiary, the local HR manager and an HR expatriate were asked to provide information regarding the implementation of head- quarters’ guidelines on subsidiary-HRM practices. A structured- interview template similar to the one used for the headquarters- level study was used at the interviews. The subsequent interviews were conducted with line managers and the head of subsidiary to verify the information received from the local HR manager and the HR expatriate. When there is a divergence of views between the local HR manager and the HR expatriate, the interview data from line managers and the head of subsidiary was considered to ascertain the current state of implementation in a particular area of HRM practices.

4. Findings In every ﬁrm we found evidence of a hybridization approach, which involves careful choices of speciﬁc elements of HRM practices for global standardization, modiﬁcation of global standards, or localization, in parent ﬁrms’ approach to subsidi- ary-HRM practices. The analysis of orientations across the forty- seven elements of the ﬁve HRM practices reveals that evidence is lacking for universal, wholesale, and homogeneous strategies that can be coherently summarized as global standardization or localization. Rather, in each participant ﬁrm, we observe that viable options are sought and selected from among the three orientations – global standardization, modiﬁcation of standards, and pure localization – for each element of HRM practices. We now elaborate on this main claim.

4.1. The emerging ‘‘global HR’’ in Korean MNEs: views from the institutional context Changes in HRM practices in South Korea that occurred after the 1997 Asian ﬁnancial crisis have been well reported in the literature. These were broadly related to the implementation of new concepts and practices, such as performance-oriented HRM systems, within the Korean business context (see e.g., Bae & Rowley, 2001; Bae & Rowley, 2003). Our interview data conﬁrm that the most signiﬁcant HR issues as seen by key actors in Korean MNEs are the challenges posed by the perceived need for the globalization of the HR function. Interviewees consistently argued that there was a clear and widespread trend among Korean MNEs for attempts at the globalization of HRM at the ﬁrm level.

According to our interview data, large Korean MNEs such as ElecCo1, ElecCo2, and AutoCo, which were established and developed their businesses in global markets earlier than most other Korean ﬁrms, initiated projects for globalizing their HR function from the mid-2000s onwards. Subsequently, other Korean MNEs from a range of industries joined the stream of globalizing efforts. According to one key informant at the subsidiary of a major American HR consultancy ﬁrm, which was a HR-consulting service provider to numerous Korean MNEs, ‘‘Global HR’’ has been established as a common and critical issue for MNEs from the Korean institutional context:

‘‘Within[the last] 5–6 years. . . the term, ‘‘Global HR’’ has been used widely in Korean business society. Before then, a main focus of Korean companies’ headquarters had been on expatriation. . . As the internationalization of businesses by Korean companies has rapidly progressed, core functions such as marketing, R&D, and manufacturing went outside Korea.

Some Korean companies even acquired foreign MNEs, which means a large number of employees are now non-Koreans.

Korean MNEs began to think of how the major practices of HRM such as the grade system, performance management, reward,and recruitment should be designed and managed in a global context’’ (Director, major HR consultancy) This view was supported in all of the nine case companies.

Previously, the management of subsidiary HR functions had been largely delegated to subsidiary HR managers, mostly hired in each host country. Corporate HR staff had not been overly concerned with the operation of HRM in individual subsidiaries. However, the rapid growth of business in foreign markets produced signiﬁcant pressure for the corporate HR staff to initiate globalizing efforts across their organizations, linking the corporate HR function and foreign subsidiaries.

4.2. A hybridization approach at the level of element of practices A range of activities may be labeled as ‘‘Global HR’’, but our interviewees mainly deﬁned it as those common activities associated with the development of global HRM guidelines, designed to guide and regulate HRM practices in subsidiaries or, in some cases, across an entire MNE, including the parent company.

With regard to research questions 1 and 2, our objective is to show how the adoption of an HR strategy that is selectively adaptive to pressures of global standardization and localization at the level of element of HRM practices affords both a more nuanced and context-dependent approach to the globalization of HR activities. We found that case companies regulated their subsidi- ary-HRM practices carefully, deciding which elements of the HRM practices needed to be globally standardized (following globally common standards), localized (allowing subsidiary discretion to respond to local needs), or modiﬁed (allowing local modiﬁcations on the global standards). The choices made for each element of practice reﬂected a nuanced understanding of where local discretion was possible without impacting the high-level global requirements of the HR system as a whole.

It is difﬁcult to assess a broad HRM topical area as globally standardized or localized without carefully examining at the level of its individual elements, and even harder to describe the overall IHRM strategy. The literature traditionally deﬁnes this IHRM strategy using the traditional dichotomy of global standardization versus localization as the general orientation in the overall system design. However, the notion of ‘‘hybridization’’ describes an IHRM strategy based on combining different orientations together. Some elements of a practice are standardized, while others are allowed to be modiﬁed based on the global standards, and yet other elements are allowed to be localized. The corporate HR staff of the ﬁrm try to select a viable option from the three alternatives for each element of the HRM practice (e.g., the performance evaluation factor, performance measurement item, weighting of evaluation factors, performance rating scale, etc.) in order to achieve a set of objectives (e.g., the globally common logics of actions, such as maintaining performance-oriented management style, facilitating global stafﬁng, etc.) within the potential constraints (e.g., the accepted legal and cultural context of host countries).

The pattern of the IHRM strategies in all nine case companies could be described as such a hybridization approach. However, the actual outcome of such endeavors was different according to the particular context of each company (see Table 2). The hybridization approach at the element level refers to the intended approach, not the realized one. As reported elsewhere (e.g., Chung et al., 2012; Gamble, 2003; Gamble, 2010; Kostova & Roth, 2002), there are potential gaps between the corporate headquarters’ intentions and actual implementation in subsidiaries.

The analysis across the nine ﬁrms shows that all can be classiﬁed as being oriented toward a hybridization approach at the element level as described above. Although variations in the C. Chung et al. / Journal of World Business 49 (2014) 549–559 554 particular blend of hybridization exist across the MNEs in their overall approach, there is not one case that could be classiﬁed as being geared predominantly toward either global standardization or localization. Even in the electronics and automotive sectors, which have been recognized as examples of globally integrated industries (Porter, 1986), the Korean MNEs intended to standardize only a highly selective range of elements within their HRM practices.

Most interviewees were reluctant to describe their IHRM strategy as being based on a global-local dichotomy, as shown by a corporate HR manager:

‘‘Actually, we began to approach the issue of global HRM with the concept of standardization, but, after giving careful consideration to it, we ﬁnally concluded that it might be unrealistic to stick to a standard model which is developed by the center due to the complexity in each subsidiary situation.

We thought that how to deploy and make it work in each subsidiary is a real issue. So, we took the view of local optimization, utilizing [external global] best practices as just one source of reference.’’ (Corporate HR manager, SteelCo) As illustrated above, Korean MNEs standardize their HRM activities selectively, based on a ﬁner level of practices. This tendency was explained by a senior manager involved in the development and implementation of global HRM guidelines in his company as follows:

‘‘We developed something called a ‘global HR standard’ and deployed it to all subsidiaries. Initially, we intended to deﬁne core areas for global standardization on an entire practice-by- practice basis, such as global grade system, job classiﬁcation system, performance management and so on. For example, regarding the grade, we wanted to say, this is our mandatory standard system that every subsidiary should follow. However, after a pilot test with several subsidiaries, we found that the approach was unrealistic and a more sensible approach would be needed to accommodate diverse local needs as well as to maintain key element as globally common. Thus, we break down major HRM tasks into more detailed elements and decided which one should be a key area for global standardiza- tion.’’ (Corporate HR senior manager, AutoCo) With regard to the research question 3, a distinctive aspect in the IHRM strategy of Korean MNEs is the strong willingness to adopt what they believe are ‘‘global best practices’’ or ‘‘global standards’’ as a source of standardization. Seven out of nine case organizations used benchmarking with leading U.S. MNEs, and eight of the MNEs hired U.S.-based global consultancies to support their globalizing efforts. HRM practices used by US-based MNEs have been widely introduced to Korean companies since the Asian ﬁnancial crisis in 1997. Information was gathered through benchmarking and work with consultancies. However, the scope and depth of the implementation of these practices differed among Korean MNEs. The majority reported that their parent companies could not fully implement espoused ‘‘ideal’’ practices for a number of reasons, such as internal constraints in their home countries based on resistance from labor unions and the continued inﬂuence of traditional practices. Home practices represented a mix of traditional seniority-based and a newly introduced performance- based system. When they developed global HRM guidelines for subsidiaries, they were not willing to consider their parent companies’ current practices as the major reference, but rather adopted ‘‘global best practice’’ as a basis of standardization:

‘‘The HRM practices of the Korean headquarters may be effective in Korea, but, could they be the same in other countries? We don’t think so. Why? Because it [the context] isvery different. Then what would be an alternative? Maybe something like ‘global best practices’ could be considered as a tool or source if they are more applicable universally, even though it might not be really the best one.’’ (Corporate HR executive, ElecCo2) Although our study of nine MNEs potentially limits the ability to generalize our ﬁndings, we identiﬁed an indication of the potential impact of the sector on the IHRM approaches of the companies. Companies 1, 2, 3 from automotive and electronics, considered as examples of globally integrated industries by Porter (1986), expressed an intention to standardize more elements of HRM practices than the other companies, as shown in Table 2.

Whilst those three companies tried to standardize 40–55 percent of elements of HRM practices, the other ﬁve companies (4, 5, 6, 7, 8) targeted only 9–17 percent, and one company (9) intended to standardize 30 percent of the elements. It remains unclear whether the differences are the result of an industry effect or an international strategy effect, as all three ﬁrms in the globally integrated industries seem to be oriented toward a global strategy, while the other ﬁrms are oriented toward a multi-domestic one.

We conducted a follow-up study to partially assess how the parent companies’ approaches to subsidiary-HRM practices, as reported in the corporate-headquarters level study, are actually recognized and implemented at the subsidiary level. Table 3 shows the recognition and implementation of the corporate guidelines on HRM practices by six subsidiaries of MNE 1.

First, corporate guidelines regarding subsidiary-HRM practices set a ‘Global HRM Standard’. These guidelines lay out the desired features of HRM practices that subsidiaries are expected to adopt and which elements of HRM practices are required to be globally common. All HR managers in the six subsidiaries have some knowledge of their corporate-headquarters approaches to subsid- iary-HRM practices, and from such knowledge determine which elements can either be modiﬁed from the global standard or are left to the full discretion of subsidiaries.

Second, although there are variations across subsidiaries and elements of HRM practices, all six subsidiaries implemented the corporate guidelines to some extent. As expected and speciﬁed in the global standards, signiﬁcant parts of the mandatory standardi- zation elements were adopted by subsidiaries. Those elements that were subject to rejection or modiﬁcation by local actors take on especial importance. For example, in India, there was a major point of difference between the intentions of the headquarters and the subsidiary practices in the grade system. The global standards speciﬁed a ﬁve-level grade system. This could not be implemented in India, where a highly differentiated hierarchical grade system was the norm and standard in the local labor market, for both domestic and foreign-owned ﬁrms. A ten-level grade system was introduced. Local actors had successfully persuaded corporate- headquarters actors that implementation of their own local version of the grade system, based on their localization logic, was preferable. We also found signiﬁcant variations among the different subsidiaries located in the same host country. In the U.S.

the more mature research and development function subsidiary showed a low level of acceptance of the corporate guidelines. By contrast, the U.S. plant, which was a newly established subsidiary, was perceived as more willing to adopt the corporate guideline.

4.3. The potential explanation on the IHRM strategy of the Korean MNEs Although we cannot generalize from nine cases, we found evidence that explains why Korean ﬁrms pursued the approaches they did, especially the utilization of a ‘‘global best practices’’ instead of the use of parent practices for global standardization of C. Chung et al. / Journal of World Business 49 (2014) 549–559 555 subsidiary HRM practices. Two factors stood out: (1) HRM-related institutional conditions of the home country; and (2) cognitive conditions of HRM-related actors in the corporate headquarters.

Regarding the institutional conditions, the case companies perceived a lack of mature practices in their home country due to the rapidly changing institutional environment. Before the ﬁnancial crisis, HRM practices in Korea were largely inﬂuenced by Japanese HRM practices (Bae & Rowley, 2003). After the crisis U.S.

practices gained legitimacy as being more advanced and effective, and have been introduced widely in Korea. However, changes are still in progress, contested between U.S. and Japanese-style HRM practices (Bae & Rowley, 2003). Newly legitimized practices are still not fully established by Korean MNEs as the desired forms.

There is variability in implementing these new ‘‘ideal’’ practices, and a lack of strong legacy practices in parent companies. Our Korean MNEs opted to standardize particular elements of their HRM practices across subsidiaries, developing and utilizing prototypes closer to ‘‘global best practices’’ rather than transferring current parent practices.

An HR planning manager involved in global HR projects explained:

‘‘We developed and deployed new global practices which were not stemming from parent-company practices, but based on benchmarking studies of well-known global companies. . . .We don’t think our HR practices in the headquarters are the ideal ones we want to implement and changing HR practices in Korea could be quite difﬁcult and need more time due to potential industrial relation issues. In a sense, we could feel more comfortable in implementing the new global practices in foreign subsidiaries ﬁrst.’’ (HR planning manager, SteelCo) Second, with regard to cognitive conditions, the majority of respondents from the case companies expressed their less- privileged status as an MNE from a non-dominant economy. They were explicitly concerned that if a label of ‘‘Made in Korea’’ isimprinted in their global HR practices, it will not be received positively by subsidiary employees. This cognitive orientation might explain why the Korean MNEs utilized diverse external sources of practices actively and were highly concerned about the legitimization of their global practices, by relying on more visible processes of hybridization. A corporate HR manager in a case company which is a leading MNE in the sector supported this view:

‘‘U.S. companies already have global concepts in their home practices in that their practices may be adopted by subsidiaries without serious conﬂicts as ‘advanced’ ones. They don’t need to develop something new for globalization. If Korea is (becomes) a dominant country. . . we might be able to plant our practices to other countries in the same way. . . But, we don’t have ‘the global consensus’ that the U.S. ﬁrms have. If we try to implement something called Korean practices in our U.S.

subsidiary, they may say we are crazy! We change ours just because we need to do it.’’ (corporate HR manager, ElecCo1) Even a well-known brand company among our case companies described itself as a company from a non-dominant economy.

Regardless of outsiders’ views, they believe that their parent HRM practices would not be welcomed by employees in subsidiaries if perceived as ‘‘Made in Korea’’. We found that the less privileged status of their home country, as perceived by the interviewees, is one of the factors that may help explain the companies’ approaches to subsidiary-HRM practices, such as adopting what they believe are ‘‘global best practices’’ or ‘‘global standards’’. Arguably, this kind of ‘‘liability of origin’’ might be found among MNEs from other newly industrialized or emerging economies.

5. Discussion Our study ﬁnds that Korean MNEs take a more nuanced approach in their IHRM strategy, rather than adopting a position along a global standardization versus localization dichotomy. We Table 3 Implementation of the corporate headquarters guidelines at subsidiaries: case of MNE 1.

Category of assessment US sales US plant US R&D India sales India plant India R&D 1. Recognition of the corporate-headquarters guideline regarding subsidiary-HRM practices Yes Yes Yes Yes Yes Yes 2. Subsidiary’s assessment of the degree of implementing the components of HRM practices which were deﬁned as ‘globally common’ (following globally common standards) by the corporate headquarters Job classiﬁcation: job family M Ga Ma La L M Job classiﬁcation: job list M G M M M L Grade: number G G M L L L Grade: criteria/deﬁnition G G M L L L Grade: title G M L L L L Promotion: requirement/criteria G M M M M L Selection: criteria (core elements) b G M L M M M Selection: assessor (HR interview) b G G L G G G Succession planning: executive pool M M M M M M Learning program: leader M G L G G M Learning program: common competency G G M G G G Performance evaluation factor G G M G G G Weighting of evaluation factors M G M G G M Performance rating scale G G M G G G Evaluation cycle/frequency G G M G G G Performance management process G G M G G G Common competency G G M G G n/a Leadership competency G G M G G n/a Competency assessment process G G M G G n/a Competency assessment rating scale G G M G G n/a (Pay philosophy – pay for performance) b G G G G G G aG: adopt the global standard guideline; M: modify the global standard guideline to accommodate local needs; L: utilize HRM practices which were developed locally to accommodate local needs; n/a: not applicable (not yet introduced). bAdditional company-speciﬁc information which is not included in Table 2. C. Chung et al. / Journal of World Business 49 (2014) 549–559 556 identify their overall orientation to IHRM strategy as a hybridiza- tion approach, whereby practices adopted at the element level are drawn from diverse sources, including so-called ‘‘global best practices’’.

This ﬁnding may challenge the dominant assumptions of the current IHRM literature that we identiﬁed earlier (Table 4). There is a clear contrast between the widely shared assumptions about the IHRM strategies of MNEs and what we found in this empirical study. Our understanding of the IHRM strategies of MNEs demands critical re-examination. Closer studies of MNEs from newly industrialized economies and emerging markets promise to extend such understanding by encompassing a wider, heterogeneous group of MNEs.

This orientation was related to the distinctive institutional and cognitive conditions that characterize their status as MNEs from a newly industrialized economy. This strategic orientation, rather than being an unintended aggregate consequence of ad-hoc practical solutions for individual HRM practices, should be under- stood as part of a deliberate attempt by Korean MNEs to overcome their ‘‘liability of origin’’ (Bartlett & Ghoshal, 2000; Chang et al., 2009; Ramachandran & Pant, 2010). The IHRM strategy is conditioned by (1) the absence of mature and unique national bundles of HRM practices due to recent and rapid changes in the home country institutional context and (2) the self-perception of less-privileged status as ﬁrms based in a non-dominant economy.

Arguably, such institutional and cognitive conditions also apply widely to the larger population of MNEs from newly industrialized economies and emerging markets. The study of Korean MNEs’ IHRM strategies reveals critical features of the new generation of MNEs based in the less-developed economies. It builds a more nuanced approach that recognizes the multiple institutional pressures experienced by these ﬁrms in ways that are distinct from their competitors based in developed home countries.

5.1. Theoretical implications A number of theoretical implications arise from our study of Korean MNEs. First, contrary to previously identiﬁed orientations of IHRM strategy, our ﬁndings show that these MNEs pursue more nuanced approaches. We found a hybridization approach to be the focal strategy for these ﬁrms – a combination of standardization, localization, or modiﬁcation at the level of element that comprises broad HR practice areas. Such a nuanced approach has also been observed in MNEs from developed countries in prior research (e.g., Gamble, 2010; Sparrow et al., 2004). However, some key features of the context of MNEs from South Korea, a newly industrialized economy, render such approaches more explicit. New constructs and/or new typologies to help capture emergent repertoires of IHRM strategy are needed that go beyond the traditional global standardization–localization dichotomy and concepts such as hybridization (e.g., Gamble, 2010), optimization (e.g., Sparrow et al., 2004), and duality (e.g., Brewster et al., 2008; Evans et al., 2002) deserve more sustained empirical attention. MNEs from newly industrialized economies and emerging markets constitute particu- larly pressing and promising cases for empirical and theoretical enhancement of our current understandings of IHRM strategy.

Second, our ﬁndings highlight that MNEs from South Korea utilize external ‘‘global best practices’’ as an alternative to parent-company practices, which have been recognized as a major source of standardization. Indeed, our particular ﬁnding on this area suggests that this emphasis on ‘‘universal best practice’’ may be more prominent and observable in the IHRM strategies of MNEs from newly industrialized economies and emerging markets and that they therefore may very well be more active and critical agents in the diffusion of dominant models and approaches on a global scale than previously recognized. In turn, we see such so- called ‘‘global best practices’’ to be widely linked to a dominance effect, which refers to the tendency of following and learning a role model – widely perceived as best practices – stemming from a country that occupies a dominant position in a hierarchy of national economies (Smith & Meiksins, 1995). In a study on HRM practices of MNEs headquartered in the U.S., Germany and Japan, Pudelko and Harzing (2007) found that their subsidiary-HRM practices can be shaped not only by local practices or parent practices, but also by ‘‘global best practices’’ coming from U.S.

MNEs. MNEs from newly industrialized economies and emerging markets, lacking an institutionally and organizationally mature and entrenched set of alternative HRM practices, and feeling inclined to adopt already legitimized practices due to their distinctive institutional and cognitive conditions, may indeed emerge as the frontrunners of the adoption of global best practices, and, arguably, key actors in the perpetuation and consolidation of dominance effects.

Third, our ﬁndings show that the liabilities of origin, particularly the role of institutional instability and the perceived weak legitimacy of being a non-dominant economy, play a signiﬁcant role in shaping IHRM strategies of emerging MNEs.

This is a distinctive variation of the ‘‘country-of-origin’’ effect (see Ferner, 1997). Previous IHRM research has examined the effect of country of origin by assessing the similarity between subsidiary- HRM practices with home country practices based on two assumptions: (1) the existence of dominant HRM practices which are strongly embedded in a home country; (2) parent company’s willingness to transfer those practices to subsidiaries because they are taken for granted as an appropriate way of managing people or a critical source of the company’s competitiveness. Our study of Korean MNEs shows it is problematic to presuppose these conditions in MNEs from newly industrialized economies and emerging markets. Emerging MNEs lack clearly demarcated and consolidated dominant practices in their home country due to the contestation among different institutions in the process of rapid transformation. Even if there are practices recognized as being effective in the home countries, the perceived weakness of legitimacy makes expectations of local adoption of these home country HRM practices precarious. Strategies of practice standard- ization based on home country standards are unlikely. When we examine the country-of-origin effects in the HRM practices of MNEs from newly industrialized economies and emerging markets, the similarity of practices between home country and subsidiary practices may be a poor, and even misleading, indicator of the effect.

5.2. Managerial relevance Contrary to the dominant assumption that standardization might occur at the overall HRM-function level or the Table 4 Dominant assumptions versus key ﬁndings.

Dimension Dominant assumptions Key ﬁndings Overall orientation Standardization or localization Hybridization Level of standardization Overall HRM function or HRM practice Detailed element within HRM practice Major origin of practices for standardization Parent company practices ‘‘Global best practice’’ C. Chung et al. / Journal of World Business 49 (2014) 549–559 557 HRM-practices level, our study shows that MNEs attempt to standardize their HRM practices highly selectively at the ﬁner level within a practice. This further suggests that there is an important managerial implication for the practice of HRM within MNEs. A corporate headquarters of an MNE might need to consider carefully the needs of standardization at a very detailed level, differentiating each element of HR practices, rather than being constrained by traditional ‘‘lumping’’ typologies that attempt to manage at the entire HRM-function level or overall practice level. The latter approaches may have serious limitations in being able to adequately consider the complex pattern of IHRM approaches that will be the most effective within MNEs.

5.3. Limitations and future research We recognize our study is not without limitations. First, as it relies on data mainly from the headquarters of each MNE, we only examine the headquarters’ view on the ﬁrm’s strategic orientation in IHRM. However, a seemingly optimal alternative could very well be interpreted differently by subsidiary actors and thus actual implementation at the subsidiary level could diverge considerably from that intended and envisioned by the headquarters. Several interviewees at subsidiaries of a MNE mentioned that even though there are mandatory requirements in subsidiary-HRM practices, which were intended to be followed by all subsidiaries, variations from the corporate guideline may exist in a particular subsidiary.

Future research is needed to build upon our ﬁndings to provide data on the actual implementation of selected IHRM strategies at the subsidiary level.

Second, in seeking to identify commonalities across Korean MNEs in their approaches to subsidiary-HRM practices, we recognize that such approaches could differ depending on the industry and on company characteristics such as size and degree of internationalization of businesses (Rosenzweig & Nohria, 1994; Schuler, Dowling, & De Cieri, 1993). The nine Korean companies vary in terms of size, industry and proportion of sales abroad but our study does not allow us to systematically test the effects of each of these factors on MNE approaches to subsidiary-HRM practices. Future research with a larger sample would be well placed to explore the patterns of differences in the international HRM approaches across companies and effects of various factors on them.

6. Conclusions Through the case study of nine Korean MNEs, this research makes several contributions to emerging research on HRM of MNEs from South Korea as well as the extension of extant research on IHRM strategy. First, it addresses the lack of empirical research on HRM in the context of MNEs from newly industrialized economies and emerging markets, which are becoming more prominent in the world economy. Second, through examining the detailed elements of each HRM practice, this research identiﬁes the hybridization approach at the element level of practices as a distinctive IHRM strategy that has hitherto not been highlighted in the IHRM scholarship. Third, this study addresses the lack of attention to the liabilities of origin as a key determinant of IHRM approach especially in MNEs from newly industrialized economies and emerging markets. Fourth, this research identiﬁes gaps between dominant assumptions and the empirical ﬁndings of emerging MNEs and suggests that studies on MNEs from newly industrialized economies and emerging markets could contribute to expand extant theories by challenging their taken-for-granted assumptions.

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