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Human resource management and the performance of Western . rms in China Ingmar Bj¨orkman and Fan Xiucheng Abstract The study examines the relationship between human resource management and organizational performance in sixty-two manufacturing Chinese–Western joint ventures and wholly owned subsidiaries located in different parts of the People’s Republic of China. A positive relation was found between . rm performance and the extent to which . rms used a ‘high-performance’ HRM system as well as the degree to which they engaged in the integration of HRM and . rm strategy. Keywords Human resource management; organizational performance; China; multinational corporations. Explaining variations in performance is one of the most enduring themes in the study of organizations (March and Sutton, 1997). During the 1990s it became increasingly recognized that a . rm’s human resources can be a source of competitive advantage (Barney, 1991; Hitt et al., 2001) and a large number of studies examined the effects of the management of human resources on organizational performance. Some of the initial results in this line of research have been viewed as promising (see reviews by Becker and Gerhart, 1996; Guest, 1997; Becker and Huselid, 1998). However, other reviewers have been considerably more critical of the extant work (Wood, 1999; Boxall and Purcell, 2000; Wright and Gardner, 2000), leading Ferris et al. to write that ‘as we view the published work in this area, we are simultaneously excited and troubled, frustrated yet optimistic, and encouraged but cautious’ (1998: 236). One particular critique of research carried out to date is that most studies have been conducted at the corporate level of analysis on the relationship between HRM practices and measures of . rm (. nancial) performance or market value of North American companies. Much less research has been conducted on other levels of analysis, such as global or local business units or individual plants (Rogers and Wright, 1998). Little work has been conducted on whether the proposed effects of HR are universalistic or contingent on the national context of the organization. Additional empirical work is clearly needed in settings outside the United States and on the subsidiaries of multinational corporations in different countries so as to investigate the impact of national culture and institutional settings on the HRM-organizational performance relationship. In an effort to address some of the gaps in the research on HRM and organizational performance, the objective of this study was to examine the relationship between HRM practices and the performance of foreign-investment units in the People’s Republic of China. There is a growing body of academic research on HRM in foreign investment Ingmar Bj¨ orkman (corresponding author), Swedish School of Economics, Post Box 479, 00101 Helsinki, Finland and INSEAD Euro-Asia Centre (e-mail: ingmar.bjorkman@shh.. ); Fan Xiucheng, Nankai University, People’s Republic of China. Int. J. of Human Resource Management 13:6 September 2002 853–864 The International Journal of Human Resource Management ISSN 0958-5192 print/ISSN 1466-4399 online © 2002 Taylor & Francis Ltd http://www.tandf.co.uk/journals DOI: 10.1080/09585190210134246 enterprises in China (e.g. Child, 1994; Goodall and Warner, 1997, 1998; Lu and Bj¨orkman, 1997; Verburg, 1996), and several authors have pointed to the importance of HRM for successful operations in China (e.g.
Approximate Word count = 1980
Approximate Pages = 7.9
(250 words per page double spaced)
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