Human resource management in Chinese multinationals in the United Kingdom: The interplay of institutions, culture, and strategic choice

• Author: Shaowei He,Rekha Rao‐Nicholson,Zaheer Khan,Geoffrey Wood,Shlomo Y. Tarba
• Date: 01 September 2019
• DOI: http://doi.org/10.1002/hrm.21935
• Published date: 01 September 2019

SPECIAL ISSUE ARTICLE

Human resource management in Chinese multinationals

in the United Kingdom: The interplay of institutions, culture,

and strategic choice

Zaheer Khan

1

| Geoffrey Wood

2

| Shlomo Y. Tarba

3

| Rekha Rao-Nicholson

4

|

Shaowei He

5

1

Kent Business School, University of Kent,

Canterbury, UK

2

Professor of International Business and Dean

of Essex Business School, University of Essex,

Colchester, UK

3

Strategy & International Business,

Department of Strategy & IB, Birmingham

Business School, The University of

Birmingham, Birmingham, UK

4

International Business, Newcastle University

London, London, UK

5

International Business, Northampton

Business School, The University of

Northampton, Northampton, UK

Correspondence

Zaheer Khan, Professor of International

Business, Kent Business School, University of

Kent, Parkwood Road, Canterbury CT 27PE,

UK.

Email: z.a.khan@kent.ac.uk

This is a study of the challenges faced by Chinese expatriate managers and their strategic

responses in securing a workable degree of alignment in UK subsidiaries, against a backdrop of

competing home-country and host-country pressures. Although much of the literature on home-

country and host-country effects tends to eitheradopt a culture or an institutional approach,this

study highlightsthe intermeshed nature of the two. In locatingcultural dynamics within an institu-

tional firmament, this study juxtaposes the effects of eachand draws conclusions as to theirinter-

section. It is foundedon in-depth interviews with home-country and host-country managers. The

findings suggest,on the one hand, Chinese expatriatemanagers tended to see local regulations as

an obstacle to efficiency, rather thanas a means to access context-specificcomplementarities. On

the other hand, thesemanagers recognized the need to fit in withestablished locally specific ways

of doing things andin securing sufficient staff buy in to sustainoperations, and played a key inter-

mediary rolebetween headquarters and subsidiary.

KEYWORDS

adaptation, boundary-spanning employees, China outward FDI, Chinese MNEs, comparative

institutional analysis, culture, expatriates integration, HRM practices, standardization

1|INTRODUCTION

An extensive literature exists on national and cultural effects on

human resource management (HRM) practices in multinational enter-

prises (MNEs) (c.f., Brewster, Wood, & Brookes, 2008; Marginson,

Edwards, Edwards, Ferner, & Tregaskis, 2010). However, much of this

literature tends to fall into comparative institutional or cultural

accounts, and there have only been limited efforts to connect the

two. This study highlights the extent to which, while the strategic

choices made by key actors are culturally defined, they are confined

and circumscribed by institutionally embedded formal and informal

regulations (c.f., Witt & Redding, 2009). It is argued in this article that

the process is a dynamic and contested one. This study seeks to

extend and complement the existing literature by exploring challenges

arising from the policy and practice of HR in recently acquired UK

subsidiaries of Chinese MNEs. As such, it sheds further light on

developed host-country effects on emerging market MNEs (EMNEs)

and the relationship between institutions, culture, and social action.

A number of recent studies have explored the subsidiaries of Chi-

nese origin MNEs (Cooke, 2014; Luo & Zhang, 2016; Meyer & Xin,

2017; D. Wang, Fan, Freeman, & Zhu, 2017). However, much of the

focus of existing work has examined outward investment motives and

whether existing theories can explain their internationalization pro-

cess (Hennart, 2012; Luo & Tung, 2007, 2017; Meyer & Peng, 2016;

Peng, 2012; Ramamurti, 2012; Luo & Zhang, 2016). Advanced econo-

mies, including the United Kingdom, have become popular destina-

tions for Chinese MNEs (Deng, Yang, Wang, & Doyle, 2017; Peng,

2012; Y. Zheng, 2016). The bulk of Chinese outward foreign direct

investment (OFDI) is driven by mergers and acquisitions (M&As)

undertaken in both developed and developing markets (Deng et al.,

2017; Liu & Woywode, 2013; Luo & Tung, 2017; M. Yang & Deng,

2017; Y. Zheng, 2016; N. Zheng, Wei, Zhang, & Yang, 2016), supple-

mented by significant greenfield investment (Buckley et al., 2007;

DOI: 10.1002/hrm.21935

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