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Dual values-based organizational identification in MNC subsidiaries: A multilevel study

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Abstract

Dual organizational identification – with both the whole corporation and the local subsidiary – is considered valuable for subsidiary employees, international assignees, and multinational corporations (MNCs). While extant research has examined antecedents of separate targets of identification, it has not fully addressed the challenge of identifying factors capable of supporting both simultaneously. This study examines the influence of individual- and organizational-level factors on the dual values-based identification of foreign subsidiary employees. Drawing on acculturation and organizational socialization theory, we test hypotheses on multilevel data from 793 managers and professionals in 90 foreign subsidiaries belonging to 11 Nordic MNCs. The results show that dual values-based identification is associated with acculturation and first-hand contact at the individual level, and a supportive social context for affective learning at the organizational level. Through its emphasis on higher-order elements that connect different parts of the MNC, rather than those that lead to the formation of in-groups and out-groups, the values-based approach to identification contributes to our understanding of dual identification in MNC subsidiaries, and represents a more positive treatment of cultural diversity. The findings have heightened practical relevance given the emphasis individuals are placing on values congruence in career choices and MNC efforts at instilling shared values.

Abstract

L’identification organisationnelle duale - à la fois avec l'ensemble de l’entreprise et la filiale locale - est considérée comme essentielle pour les salariés de la filiale, les expatriés internationaux et les entreprises multinationales (EMN). Bien que les recherches existantes aient examiné les antécédents de cibles distinctes d'identification, elles n’ont pas pleinement pris en compte le défi de l'identification des facteurs capables d’intégrer les deux niveaux simultanément. Cette étude examine l'influence des facteurs individuels et organisationnels sur l’identification fondée sur les valeurs duales des salariés des filiales étrangères. Partant de l'acculturation et de la théorie de la socialisation organisationnelle, nous testons des hypothèses à partir des données multiniveaux de 793 dirigeants d’entreprises et professionnels travaillant dans 90 filiales à l'étranger de 11 multinationales scandinaves. Les résultats montrent que l'identification fondée sur les valeurs duales est associée au niveau individuel à l'acculturation et au contact direct, et au niveau organisationnel au contexte social favorable à l'apprentissage affectif. Grâce à l'accent mis sur des éléments d'ordre supérieur qui lient les différentes entités de l’EMN, plutôt que sur ceux qui conduisent à la formation de groupes internes et externes, l'approche de l'identification fondée sur les valeurs contribue à notre compréhension de la double identification dans les filiales des multinationales, et représente un traitement plus positif de la diversité culturelle. Les résultats renforcent la pertinence pratique étant donné l’importance que les individus accordent à la congruence des valeurs dans le choix des carrières et aux efforts des EMN à inculquer des valeurs partagées.

Abstract

La identificación organización dual –tanto con la empresa entera como con la filial local – es considerada valiosa tanto para los empleados de la filial, como para los designados en el extranjero y para las empresas multinacionales. Mientras la investigación existente ha examinado los antecedentes de los objetivos independientes de identificación, el reto de identificar factores capaces de apoyar las dos identificaciones simultáneamente no ha sido abordado a cabalidad. Este estudio examina la influencia de los factores a nivel individual y organizacional basada en valores duales de los empleados de las filiales extranjeras. Sobre la base de las teorías de aculturación y socialización organizacional, evaluamos las hipótesis sobre los datos multinivel en 793 gerentes y profesionales de 90 filiales extranjeras pertenecientes a 11 empresas multinacionales nórdicas. Los resultados muestran que la identificación dual basada en valores es asociada con aculturación y contacto directo a nivel individual, y un contexto social que apoye el aprendizaje afectivo a nivel organizacional. A través de este énfasis en elementos de un nivel superior que conectan las diferentes partes de la multinacional, en lugar de aquellos que conducen a la formación de grupos de adentro y de grupos fuera, la aproximación basada en valores para la identificación, contribuye a nuestra comprensión de la identificación dual en filiales de las multinacionales, y representa un tratamiento más positivo de la diversidad cultural. Los hallazgos han aumentado la importancia práctica debido al énfasis que los individuos le están dando a la congruencia de valores en la elección de carreras, y los esfuerzos de las multinacionales en inculcar valores compartidos.

Abstract

Dupla identificação organizacional – tanto com a corporação como um todo quanto com a subsidiária local - é considerada valiosa para os funcionários da subsidiária, designados internacionais e corporações multinacionais (MNC). Apesar das pesquisas existentes terem examinado antecedentes de metas distintas de identificação, elas não abordaram plenamente o desafio de identificar fatores capazes de apoiar ambas simultaneamente. Este estudo analisa a influência de fatores individuais e organizacionais na identificação baseada em valores duais de funcionários de subsidiárias estrangeiras. Com base na teoria de aculturação e socialização organizacional, testamos hipóteses em dados multiníveis de 793 gerentes e profissionais de 90 subsidiárias estrangeiras pertencentes a 11 MNCs nórdicas. Os resultados mostram que a identificação baseada em valores duais está associada à aculturação e ao contato inicial a nível individual, e a um contexto social de apoio para a aprendizagem afetiva no nível organizacional. Através de sua ênfase em elementos de ordem superior que conectam diferentes partes da MNC, e não naqueles que levam à formação de grupos internos e externos, a abordagem baseada em valores de identificação contribui para a nossa compreensão da dupla identificação em subsidiárias de MNC e representa um tratamento mais positivo de diversidade cultural. Os achados têm relevância prática ampliada dada a ênfase que as pessoas têm dado à congruência de valores nas escolhas de carreira e nos esforços das MNC em incutir valores compartilhados.

Abstract

这项研究提出了一个战略人力资本对齐框架, 以检验在跨国公司中子公司战略 (例如, 出口导向型vs本地市场导向型) 和人力资本 (例如, 母公司vs当地人力资本) 之间的对齐是否与子公司的绩效正相关?我们进一步探索了两个重要的边界条件——外生边界条件 (例如, 外汇汇率变化) 和内生边界条件 (例如, 跨国公司的国际经验) , 因为它们可能会调节战略人力资本对齐对绩效的正向效应。基于对1990-2012年间423家跨国公司的5604家子公司观察数据的分析, 证实了子公司战略与人力资本对齐对绩效的正向协同效应, 同时也显示了外汇汇率变化和国际经验的调节作用。通过展示子公司战略-全球人力资源对齐以及外部经济环境和内部组织能力角色作为边界条件的重要性, 本战略人力资本对齐框架表明 : 人力资本对公司价值的体现恰是人力资本与公司战略导向的对齐。因此管理者应该仔细部署适当类型的人力资本以实现所需的组织策略, 同时在应用这一框架时也应该考虑不断变化的内外部情境条件。

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Notes

  1. Identification has in previous research been linked to the concepts of organizational commitment (Ashforth et al., 2008; Edwards, 2005) and person–organization fit (Cable & Judge, 1996; Chatman, 1989). While interrelated, the main differences are that values-based organizational identification is self-referential and focuses on perceived similarities in values, whereas organizational commitment is a broader concept that includes the extent to which an individual intends to participate in an organization (i.e., to stay and exert effort) as well as identify with it (Riketta, 2005). Person–organization fit is also much broader (Pratt, 1998), and unlike person–organization fit, identification involves individuals using organizations that they see as similar to themselves to refer to themselves (Dutton et al., 1994).

  2. We unfortunately did not have the kind of data necessary to test for what Vora and Kostova (2007) refer to as the “form” of identification, that is, whether the relationship between the two targets of identification is “compound,” “nested,” or “distinct.” Our assumption is based on the prevailing view that employees are able to identify simultaneously with more than one organizational entity (e.g., Ashforth & Johnson, 2001; Hornsey & Hogg, 2000).

  3. In order to test for the non-linearity of tenure, we ran the model with the tenure-squared term for both MNC and subsidiary tenure, but they were not significant. We therefore did not include these in the final model.

  4. For robustness purposes, we entered distance measures for each of the nine individual cultural dimensions in separate analyses. The results of the analyses were that none of the individual dimensions were significantly related to dual identification except for “future orientation,” which was positively related with dual identification at the p<0.05 level. None of the individual culture dimensions significantly affected the strength of the relationships between dual identification and the independent variables.

  5. Based on a suggestion from one of the anonymous reviewers, we ran additional analyses with each of the subsidiary functions as dummies in order test for whether a specific function, as opposed to the breadth of functions, influenced identification. The results were non-significant so we retained the additive measure.

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Acknowledgements

The authors are grateful to the Finnish Funding Agency for Technology and Innovation (Tekes) (Dec. no.53/31/08) and the Academy of Finland (Dec. no. 122402) for financing this research.

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Authors and Affiliations

  1. Department of Management, University of Vaasa, Vaasa, Finland

    Adam Smale & Jennie Sumelius

  2. Aalto University School of Business, Aalto, Finland

    Ingmar Björkman & Kristiina Mäkelä

  3. Department of Management and Organization, Hanken School of Economics, Helsinki, Finland

    Mats Ehrnrooth & Sofia John

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  1. Adam Smale
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  2. Ingmar Björkman
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Correspondence to Adam Smale.

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Accepted by Mary Zellmer-Bruhn, Area Editor, 27 March 2015. This article has been with the authors for three revisions.

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Smale, A., Björkman, I., Ehrnrooth, M. et al. Dual values-based organizational identification in MNC subsidiaries: A multilevel study. J Int Bus Stud 46, 761–783 (2015). https://doi.org/10.1057/jibs.2015.18

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