The International Journal of Human Resource

Management

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Expatriate characteristics and the stickiness of

HRM knowledge transfers

Yi-Ying Chang & Adam Smale

To cite this article: Yi-Ying Chang & Adam Smale (2013) Expatriate characteristics and
the stickiness of HRM knowledge transfers, The International Journal of Human Resource
Management, 24:12, 2394-2410, DOI: 10.1080/09585192.2013.781436

To link to this article: https://doi.org/10.1080/09585192.2013.781436

Published online: 20 May 2013.

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The International Journal of Human Resource Management, 2013
Vol. 24, No. 12, 2394–2410, http://dx.doi.org/10.1080/09585192.2013.781436

Expatriate characteristics and the stickiness of HRM knowledge

transfers
Yi-Ying Changa* and Adam Smaleb
a
Department of Business Administration, National Taiwan University of Science and Technology,
Taipei, Taiwan; bDepartment of Management, University of Vaasa, Vaasa, Finland
In this study, we problematise the role of expatriates in transfers of parent HRM
knowledge since expatriates, argued to be key actors in this process, are rarely HR
professionals and seldom have much education or experience in HR. In the light of
scant empirical research on the impact of individual attributes of expatriates in the
transfer of knowledge, this study aimed to identify the characteristics of subsidiary
expatriate managers that most affect the ‘stickiness’, or difficulty, of HRM knowledge
transfers from multinational firm parent to foreign subsidiaries. The study is based on
86 personal interviews with 60 expatriate managers in 4 British subsidiaries belonging
to 4 Taiwanese multinational corporations. The findings reveal how the ability and
motivation of expatriates affect transfer stickiness both in terms of their absorptive
capacity as an HRM knowledge recipient and their disseminative capacity as an HRM
knowledge source.
Keywords: expatriation; human resource management; knowledge transfer; multi-
national corporation

Introduction
Influenced by early contingency models of strategic international HRM (e.g. Schuler,
Dowling and De Cieri 1993; Taylor, Beechler and Napier 1996), studies investigating the
transfer of HRM practices from the parent to foreign subsidiaries in multinational
corporations (MNCs) have identified an array of host-country, parent-country, MNC and
subsidiary characteristics associated with patterns of HRM in foreign subsidiaries (see
Edwards and Kuruvilla [2005] for a detailed review). However, these studies have focused on
macro-level and, to a lesser extent, meso-level factors at the expense of other plausible micro-
level factors. Despite calls for more research on how micro-level variables influence
knowledge transfer and the transfer of HRM practices (Peng and Luo 2000; Björkman, Smale,
Sumelius, Suutari and Lu 2008; Bonache and Zárraga 2008; Cooke 2009; Rupidara and
McGraw 2011), there is still scant empirical research on the role that individual characteristics
of key actors such as expatriate managers play in the transfer process.
Expatriates have come to be viewed as an important mechanism of knowledge transfer
in MNCs (e.g. Bonache and Brewster 2001; Hocking, Brown and Harzing 2004; Wang,
Tong and Koh 2004; Fang, Jiang, Makino and Beamish 2010). Research in the field of
international HRM also attests to the instrumental role played by expatriates in facilitating
transfers of HRM practices (e.g. Rosenzweig and Nohria 1994; Bae and Lawler 2000).
As key interpreters and implementers of HR strategy (Harris and Holden 2001), studies
show that an expatriate manager’s ability and motivational disposition are critical in the

*Corresponding author. Email: y.chang@mail.ntust.edu.tw

q 2013 Taylor & Francis

 The International Journal of Human Resource Management 2395

assimilation by foreign subsidiaries of tacit and explicit forms of HRM knowledge (e.g.
Gamble 2003; Smale 2008a). However, in the light of the above, it is somewhat surprising
that expatriates typically lack a background in HR and HR professionals are rarely
expatriated (see e.g. Riusala and Smale 2007).
The difficulties involved in the transfer of knowledge and best practices within the firm
have been grouped into different categories – what Szulanski (1996) in his seminal work
refers to as ‘stickiness’ factors. Adopting the communications model, these stickiness
factors include the characteristics of knowledge, context, sender and recipient. As ‘agents
of headquarters’ and mediators between the home and host organisation, we argue that the
two latter categories will be especially important in increasing our understanding of the
characteristics of expatriates and their impact on the degree of stickiness of HRM
knowledge transfers. This is because expatriates can be considered as HRM knowledge
recipients when knowledge and best practices are transferred from corporate headquarters,
as well as knowledge senders when these need to be communicated to host subsidiary
employees. However, there is scant empirical research that explores how these and other
characteristics of the expatriate subsidiary manager affect the transfer of HRM knowledge.
In addressing the above gaps in research, this paper aims to shed light on the
characteristics of subsidiary expatriate managers that most affect the stickiness of HRM
knowledge transfers from MNC parent to foreign subsidiaries. The study is based on 86
semi-structured personal interviews conducted over four years with 60 expatriate
managers located in four British subsidiaries belonging to four Taiwanese MNCs. In this
way, the study also answers calls for more research on transfers of management
knowledge from developing, newly industrialised economies (NIEs) to developed
economies, i.e. ‘from the East to the West’ (Lang and Steger 2002, p. 289).
Building on the stickiness factors presented by Szulanski (1996), which include a
source’s lack of motivation and credibility, and a recipient’s lack of motivation, absorptive
capacity and retentive capacity, we investigate the characteristics of subsidiary expatriate
managers by looking at their absorptive capacity and disseminative capacity. In this study,
absorptive capacity is defined in line with Minbaeva, Pedersen, Björkman, Fey and Park
(2003) and refers to both the ability and motivation of expatriates to receive new
knowledge. Disseminative capacity, on the other hand, refers to the ability and motivation
of expatriates to transfer knowledge where and when it is needed within the firm
(Minbaeva and Michailova 2004).
The paper is organised as follows. The next section provides a brief review of the
relevant literature on the role of expatriates in international HRM and knowledge transfer
research. We then detail our research design and the methods used, followed by the study’s
empirical findings. We conclude by discussing the implications of our findings and
outlining some avenues for future research.

Expatriation and HRM knowledge transfer

Expatriates have been described as fulfilling various roles ranging from the more practical
filling of overseas vacancies to the more strategic purposes of personal, managerial and
organisational development (see e.g. Edström and Galbraith 1977). From an MNC
perspective, the motives behind deploying expatriates have incorporated the simultaneous
need for control, coordination and know-how transfer (Torbiorn 1994). In conjunction
with the promotion of knowledge-based capabilities within MNCs, the expatriate’s ability
to assimilate and teach often complex forms of knowledge has rendered their role of
strategic significance (Bonache and Brewster 2001). This knowledge-based view on
2396 Y-Y. Chang and A. Smale

expatriation has thus prompted several studies in this area (see e.g. Hocking et al. 2004;
Hébert, Very and Beamish 2005; Fang et al. 2010).
In a similar vein, expatriates have been viewed as an important facilitator of HRM
practice transfers. In addition to MNC nationality, international product/service
standardisation and the structure of the HR function (Ferner et al. 2011), the presence
of expatriates has also been shown to explain the similarity between parent and subsidiary
HRM practices (e.g. Rosenzweig and Nohria 1994; Björkman et al. 2008). There are
several possible reasons for this. First, expatriates assist in the communication of explicit
and tacit forms of HRM knowledge within MNC subsidiaries (Gamble 2003). Second,
expatriates (particularly parent-country nationals) are described as ‘cultural carriers’ in
terms of their capacity to exercise cultural control via the promotion of common corporate
values and norms (Ouchi 1979). Third, expatriates are able to facilitate knowledge and
practice transfer through their existing connections with HQs, which not only provides
them with key knowledge resources, but also develops within expatriates a stronger
commitment to HQs (Torbiorn 1982; Banai and Reisel 1993). And fourth, expatriates are
likely to have greater experience in understanding and implementing corporate HRM
practices as a result of their previous work experience (Brewster and Suutari 2005).
Cerdin’s (2003) conceptual model on the role of expatriates in the international
diffusion of HRM practices suggests that expatriates play a key mediating role between
two distinct forces – one derived from the parent company in terms of its belief in its
HRM competence and the degree to which expatriates are considered transferors of HRM
practices, and the other from host-country nationals in terms of their willingness to interact
with the expatriate, trust them and commit to a shared vision. In turn, the impact that the
expatriate will have on the diffusion of HRM practices, Cerdin (2003) argues, will be
dependent on the expatriate’s role discretion (e.g. in adapting parent HRM practices), the
quality of intercultural interaction and the length of the assignment.
Whilst the presence and role of subsidiary expatriate managers have been shown to be
important for the transfer of HRM knowledge and practices, few empirical studies have
investigated the characteristics of these key actors in depth. Furthermore, no prior
work problematises the fact that these expatriates seldom have HR education or work
experience, and that HR professionals are rarely expatriated. This raises the question of
whether the lack of HR credentials negatively affects the HRM knowledge transfer
process, and if so, how.

Knowledge stickiness
Whilst much debate exists on the nature and definition of knowledge, knowledge is
referred to here as both tacit and explicit management know-how required for MNC
subsidiaries to operate effectively (Gupta and Govindarajan 2000) and that reflects the
firm’s view of what constitutes best practice (Szulanski 1996). In this study, we focus on
HRM knowledge. We can talk about HRM knowledge for a number of reasons. First,
HRM practices can be viewed as a context-bound and culture-specific resource (Tayeb
1998; Fey, Morgulis-Yakushev, Park and Björkman 2009) that can only be applied
through its utilisation or through social interaction (Subramaniam and Venkatraman
2001). Second, HRM has the potential to enhance a firm’s value through its application
and learning in different organisational circumstances (Tyson 1999) and through its
embeddedness in a firm’s routines, practices, norms and values (Flood, Ramamoorthy
and Liu 2003). Accordingly, it can be said that HRM possesses several knowledge
characteristics (Smale 2008b).
 The International Journal of Human Resource Management 2397

Internal stickiness refers to the difficulties of transferring knowledge within organisations

(see e.g. von Hippel 1994; Szulanski 1996). A plethora of factors have been identified as
rendering knowledge transfer within the firm problematic or ‘sticky’, including institutional,
cultural and organisational factors (e.g. Szulanski 1996; Kostova and Roth 2002; Buckley,
Clegg and Tan 2006). However, much fewer studies have addressed micro-level transfer
impediments, or what Szulanski (1996) refers to as the characteristics of the source and
recipient. In the following sections, we briefly discuss the characteristics of expatriates that may
affect HRM transfer stickiness – absorptive capacity (i.e. expatriate as knowledge recipient)
and disseminative capacity (i.e. expatriate as knowledge source).

Expatriate absorptive capacity

Defined as the ability and motivation to receive new knowledge (Minbaeva et al. 2003),
studies on knowledge transfer within MNCs suggest that the absorptive capacity of
receiving units significantly impacts the internal flow of knowledge (e.g. Gupta and
Govindarajan 2000; Minbaeva et al. 2003). Efficient HRM knowledge transfer is likely to
be dependent not only on the absorptive capacity of receiving units in general, but also on
the absorptive capacity of knowledge transferors, such as expatriates, who are frequently
tasked with acquiring and communicating this knowledge. Wang et al. (2004) argue
that expatriates must absorb and learn from the parent in order to facilitate the diffusion
of know-how and skills. In other words, transfer stickiness will appear in the HRM
knowledge transfer process if expatriates are unable to absorb, retain and apply
HRM knowledge in cross-border settings due to them possessing an insufficient, pre-
existing stock of HRM knowledge.
One might anticipate the degree of expatriate absorptive capacity as being problematic,
given that expatriates rarely have an HR background and HR professionals are seldom
expatriated (see e.g. Riusala and Smale 2007). Extant research reveals that the selection of
expatriates is mainly based on technical and managerial competencies, and facilitating tighter
control, improved communication and coordination between HQs and subsidiaries (Edström
and Galbraith 1977; Delios and Beamish 2001; Harzing 2001). A preference for expatriate
managers with the requisite generalist knowledge and skills to achieve these strategic aims
will mean that most expatriates are short of functional HR knowledge and experience. Not
only is this likely to hinder their ability to absorb new HRM knowledge, it may also affect
negatively their attitude towards HRM and motivation to learn new HRM practices.

Expatriate disseminative capacity

Defined as the ability and motivation to transfer knowledge where and when it is needed
within the firm (Minbaeva and Michailova 2004), the disseminative capacity of expatriates
is also likely to affect the HRM knowledge transfer process. This is principally because
knowledge transfer is a reciprocal, collaborative endeavour that relies as much on the
knowledge, attitudes and behaviour of knowledge sources as knowledge recipients.
Although not supported in his empirical study, Szulanski (1996) argues that a source’s lack
of motivation and his/her lack of credibility in the eyes of recipients will lead to increased
levels of stickiness. Without a high level of motivation, expatriates are less likely to
organise their personal resources to tackle stickiness arising during their assignment
(Chen, Kirkman, Kim, Farh and Tangirala 2010). Bonache and Zárraga (2008) argue
further that the interaction between international assignees’ abilities and willingness to
share knowledge will lead to increased levels of knowledge transfer to the recipient unit.
2398 Y-Y. Chang and A. Smale

The disseminative capacity of expatriate managers, also referred to as ‘pedagogical

ability’ (Evans, Pucik and Björkman 2011, p. 397), is likely to be problematic when it
comes to HRM since disseminative capacity is related to previous experience and the
ability to consider different perspectives when presenting new knowledge (Reagans
and McEvily 2003). In terms of ability, then, an expatriate’s lack of HR experience and
expertise will inhibit their ability to communicate the knowledge effectively. This will be
especially problematic if it is combined with low familiarity of the host context given that
HRM is purported to be one of the most institutionally and culturally specific management
functions (Tayeb 1998).
In conclusion, we conceptualise the transfer of parent HRM practices to foreign
subsidiaries as a process of knowledge transfer in which expatriate managers play a
potentially pivotal role as knowledge transferors. We problematise the role of expatriates
as both recipients (from HQs) and sources (to host employees) of HRM knowledge, given
that they typically do not have a background in HR and HR professionals are rarely
expatriated. We argue that characteristics of expatriate managers such as these could
increase the stickiness of HRM knowledge transfers. In this study, we focus on factors
relating to expatriates’ absorptive and disseminative capacity.

Method
The present study is a qualitative case study based on personal interviews with subsidiary
expatriate managers in four British subsidiaries belonging to four Taiwanese MNCs
carried out over a four-year period from October 2005 to January 2009. The qualitative
approach was adopted as it is better suited to the study of complex relationships in HRM
(Ferner 1997) and to assist theory building and confirmation in a cross-cultural setting
(Osland and Osland 2001).
The objective was to explore the characteristics of subsidiary expatriate managers that
most affect the ‘stickiness’ of HRM knowledge transfers from MNC parent to foreign
subsidiaries – in this case, Taiwanese HQs to UK subsidiaries. The data were collected
through 86 in-depth, semi-structured personal interviews with 60 expatriate managers, i.e.
some of the 60 expatriates were interviewed twice. Triangulation of source data was
achieved within the firms by interviewing expatriate managers from different positions
(top, senior and middle managers) and functions (marketing, finance, production and IT).
The use of multiple respondents enabled the researcher to address questions on different
topics to different respondents, as well as to clarify responses to the same questions from
more than one respondent. This follows calls for using multiple respondents to increase
data validity in HRM research (Ferner and Quintanilla 1998).
All 60 expatriate managers were parent-country nationals and were all involved in the
transfer of HRM knowledge from the parent either as HR policy decision-makers or as
managers responsible for HRM implementation. However, none of the expatriates had any
educational background or formal training in HR, or previous experience of working with
HRM issues either at HQs or at other foreign subsidiaries.
The selection of Taiwanese MNCs was not only motivated by the nationality and
location of the lead researcher, but also because our understanding of expatriation and
knowledge transfers in MNCs is mostly limited to MNCs from developed economies such
as the USA and Western/Northern Europe (e.g. Minbaeva and Michailova 2004; Hocking,
Brown and Harzing 2007) along with Japan (e.g. Belderbos and Heijltjes 2005; Hébert
et al. 2005). Comparatively few attempts have been made to examine the role of
expatriates in knowledge transfers from NIEs to subsidiaries located in developed
 The International Journal of Human Resource Management 2399

economies. Details regarding the subsidiaries and respondent characteristics are provided
in Table 1.
A list of Taiwanese MNCs and their contact persons was gained through the Taiwanese
Foreign Trade Council in London, the Financial Analysis Made Easy (FAME) database and
the British Council’s Taipei office website. Interviews scheduled by telephone were carried
out through personal site visits to subsidiaries in the north of England, the Midlands and
Greater London. Interviews with managers were in Chinese, lasted between 30 and
60 minutes, and were all recorded and later translated into English.
Interviewees were asked to introduce themselves, provide a short background (e.g. work
experience, positions occupied) and explain the staffing process for expatriates in their
companies. They were then asked to describe their major tasks as an expatriate manager,
before specifically being asked about their responsibilities and involvement in the
introduction of the parent company’s HRM practices to the subsidiary (e.g. ‘what has been
your role in the introduction of parent HRM practices to the UK?’). The next set of questions
focused on their experiences in this role of transferor (e.g. ‘what difficulties, if any, have you
faced in transferring HRM practices to this unit?’, ‘how would you describe your relationship
with corporate and subsidiary HR?’), followed by questions about how they and other key
parties responded to challenges faced in the process (e.g. ‘what was the role of local HR?’).
Chinese communication style is more delicate than western forms (Bond 1986).
In order not to miss the original meaning, the interviewer took extensive notes and digital
recordings during the interviews. The interviewer also reiterated the interviewees’
comments and verified the actual meaning with the interviewees. The data were first
translated into English and after three weeks a second review of the translation was
conducted when all the data had been transcribed and translated. In total, more than 250
pages of transcripts were available for analysis.
In analysis, the data were coded and categorised into groups relating to the problems
expatriates cited in the HRM transfer process using the concepts of disseminative and
absorptive capacity as a guide. Further analysis within these groups enabled a more detailed
identification of the characteristics of subsidiary expatriates that affected the transfer process.
Quotations from the raw data are used to illustrate the nature of the patterns identified. The
theoretical propositions developed from the data analysis were then compared with the
literature using the ‘enfolding literature’ method (Eisenhardt 1989). The two activities
involved in the enfolding literature method are to compare the data with conflicting literature
and to compare the data with similar literature. These two activities served to ‘build internal
validity, raise theoretical level, improve construct definition, and sharpen generalisation’
(Eisenhardt 1989, p. 533). Following this method, we searched for theoretical replication and
evidence for the ‘why’ behind relationships. The iteration between theory and the data was
stopped when no new category or explanation emerged.

HRM in Taiwan and the UK

In order to place the current study in the context of Taiwanese MNCs in the UK, a brief
overview of the main differences between Taiwanese and UK HRM is provided, along
with recent findings on the use of expatriates in Taiwanese MNCs.
Partly due to the Asian financial crisis but also due to the significant influx of foreign
direct investment, firms in Taiwan have increasingly been adopting internationally
standardised HRM practices around western models (Zhu 2003). However, the existence
of culturally embedded East Asian management practices and mindsets has meant that
HRM in Taiwan has been experiencing ‘relative convergence’ (or cross-vergence) rather
 2400

Table 1. Respondent and subsidiary sample characteristics.

MNC size Subsidiary Size of No. of Position
(no. of size (no. of Mode of Subsidiary subsidiary HR respondents (average tenure,
MNC Industry employees) employees) establishment age (years) department (expatriates) years) Nationality Age
Techco1 IT and electronics . 10,000 . 150 Greenfield 26 3 19 MD: 1 (20) All PCNs , 30: 0%
Finance Manager: 1 (9) 30 – 50: 95%
Line Manager: 12 (11) . 50: 5%
Production Manager: 3 (12)
IT Manager: 2 (13)
Techco2 Telecommunications . 2200 . 70 Greenfield 14 4 11 MD: 1 (20) All PCNs , 30: 9%
Finance Manager: 1 (10) 30 – 50: 91%
Line Manager: 7 (14) . 50: 0%
Production Manager: 2 (14)
Tranco1 Shipping . 22,000 . 100 Greenfield 40 2 10 MD: 1 (22) Finance All PCNs , 30: 0%
Manager: 1 (9) 30 – 50: 90%
Line Manager: 6 (14) . 50: 10%
Production Manager: 2 (14)
Y-Y. Chang and A. Smale

Tranco2 Shipping . 18,000 . 200 Greenfield 20 6 20 MD: 1 (25) All PCNs , 30: 0%
Finance Manager: 1(9) 30 – 50: 90%
Line Manager: 13 (13) . 50: 10%
Production Manager: 3 (14)
IT Manager: 2 (16)

Note: The four subsidiaries all had local HR managers with tenures ranging from 15 to 20 years. PCN, parent-country national.
 The International Journal of Human Resource Management 2401

than total convergence to western HRM (Zhu 2003). Indeed, Wu (2004) argues that top
management values such as hardship and familism, emphasised by Confucianism, will
continue to shape the design of HRM systems in Taiwanese firms. Furthermore, the
principle of harmony can be evidenced in the use of participatory management such as
quality circles, goal-setting, participation in decision-making and also in the avoidance of
conflict in interpersonal relationships. Wu (2004) also argues that the changing values
of especially the younger generation will mean that firms in Taiwan will find more
support for open and commitment-based HRM systems associated with the US or western
style.
The kinds of HRM practices that characterise Taiwanese firms include long-term
employment and job security in exchange for unquestioning loyalty, emphasis on
cultural control and less emphasis on individual performance appraisals. This stands in
some contrast to HRM practices in the UK where individualism and short-termism
predominate, reflected in, for example, more candid individual-based performance
appraisals and the use of more flexible employment contracts (for a detailed comparison,
see Chang, Wilkinson and Mellahi 2007). Whilst Taiwanese MNCs in the UK are shown
to locate key strategic decision-making at HQs, they are shown to overcome differences
in the two HRM systems by adopting a blend of local and hybrid HRM practices (Chang
et al. 2007).
Regarding the roles of expatriates, Taiwanese MNCs exhibit a strong preference for
staffing high-level management positions in foreign subsidiaries with parent-country
nationals. This is partly due to the particularistic nature of Confucian ethics where those
who have the closest social or hierarchical relationships (i.e. guanxi) with the owner
gain most favour (Chen, Lawler and Bae 2005). However, this is also shown to be due
to their preference for tight, paternal control of subsidiaries where expatriates implement
forms of output-based and behaviour control such as preventing deviations from agreed
targets, discouraging dysfunctional behaviours and ensuring that subsidiary activities
remain consistent with the overall objectives of the MNC (Chang, Mellahi and
Wilkinson 2009).

Results
The following sections present the findings on how the characteristics of the expatriate
subsidiary mangers, relating to absorptive and disseminative capacity, affected the transfer
of parent HRM practices.

Expatriate absorptive capacity

All but four of the expatriates interviewed reported that they experienced difficulties in
absorbing and assimilating parent HRM practices despite efforts by HR representatives at
HQ to teach them. This was explained as being partly due to their functional background
and lack of HR expertise, which resulted in a lack of clarity about how the HRM practices
were supposed to support the achievement of business objectives. This, in turn, had
negative impacts on their motivation to learn new parent HRM practices. For example:
I am unable to catch up with all the HRM practices from HQ when I go back to HQ every six
months [ . . . ]. To be honest, I cannot see the relationship between my productivity targets and
certain HRM practices used at the UK subsidiary. Perhaps it is because I am from an electrical
engineering background and have no idea about HRM issues. (Line Manager – Techco2,
October 2008)
2402 Y-Y. Chang and A. Smale

The majority of expatriate managing directors (MDs, n ¼ 3), on the other hand, reported a
lack of motivation to learn new HRM practices on account of their previous experience
working with subsidiary employees more generally:
I lost interest in learning new management practices from HQ in terms of how to manage local
staff effectively. I was successful in managing other European subsidiaries before I moved to
the UK subsidiary. I do not think at my age (50) as a MD I need to learn new HRM practices
from HQ. (MD – Tranco1, June 2006)
In terms of absorptive capacity, whilst expatriate line managers (n ¼ 55) would most
frequently cite problems in being able to understand the ‘why’ and ‘how’ of HRM knowledge
from HQ, MDs (n ¼ 3) most frequently cited a lack of motivation. Explanations given for this
were that, first, most MDs perceived they had already learned all they need to know and,
second, that they had little time or motivation to learn new HRM practices, viewing them as
part of a traditional personnel support function that were not ‘immediate for our daily tasks’.
In many cases, they applied the parent’s HRM practices not because of their belief in their
value, but because of the push from HQ:
To be honest, I am not willing to learn (new) HRM because I have a mountain of business
operations and transactions to deal with in the UK [ . . . ]. I know how to manage people as a MD
without learning such practices. Local staff can pick up the tacit side of HRM such as loyalty and
commitment through my daily working behaviours [ . . . ]. But I still have to implement (parent
HRM practices) because it’s demanded by HQ. (MD – Tranco2, March 2007)
Both MDs (n ¼ 3) and line managers (n ¼ 38) revealed that they were not comfortable
discussing HRM issues with HQ, partly because it was not them they typically reported to and
partly due to their cultural orientation to protect face in situations where they lacked
understanding. Coming from technical backgrounds and not being familiar with the
international HRM practices that were being introduced to the UK subsidiaries, they felt
uneasy about asking colleagues at HQ questions about HRM practices. For example:
I am not used to discussing why and how we have to implement HRM practices with HR staff
at the HQ. I feel embarrassed if I ask HR people how to use these HRM practices developed by
HQ. This is because my personal experiences are from IT departments. [ . . . ] In technical
departments, you have to sort out technical issues yourself by studying relevant materials or
sources. (Service and Repair Manager – Techco2, January 2007)
There was notable variation in levels of retentive capacity between expatriate line managers.
Some expatriate managers (n ¼ 30) were willing and able to adopt the parent’s HRM
practices and put them into use, whereas others were not. The main reason for low retentive
capacity mostly related to a lack of motivation stemming from the lack of priority attributed to
HRM in comparison to operational issues. Those who exhibited higher levels of retentive
capacity described parent HRM knowledge as beneficial in helping them to manage a
culturally diverse workforce in a foreign work environment. Examples of low and high
retentive capacity are given below:
I am not able to maintain a good understanding of HRM practices transferred from the HQ. Put
simply, this kind of knowledge is not relevant to my daily functions and operations. My main job
as an expatriate is to complete the repair targets requested by my customers in the UK. I am not
willing to keep up to date with HRM practices. These are the kinds of organisational political
issues that I am unwilling to get involved in. (Line Manager – Techco1, August 2008)
I was quite willing to learn this kind of soft side of HRM practices from HQ. It gives me the chance
to learn how to tackle management issues such as how to manage staff from different cultural
backgrounds. This will help me be more confident in dealing with local staff and in the future
when I work in other Western subsidiaries. (Production Manager – Techco1, May 2007)
 The International Journal of Human Resource Management 2403

All expatriates (n ¼ 60) indicated that their educational backgrounds were in IT,
computer-related sciences or finance. The production and line managers described this as
contributing to the difficulties they experienced in learning the concepts and purposes
behind some of the HRM practices from HQ and how to implement them. Some could not
understand the link between the parent HRM system and subsidiary performance targets;
others felt that they should not be the main carriers of the parent company’s HRM
practices. They mostly agreed, however, that it was often beyond their capacity to
implement new HRM knowledge under significant pressures to achieve the parent’s
strategic targets. The following quotation illustrates these generally held views about the
lack of absorptive capacity:
I am not willing to implement the HQ’s HRM practices because first, I do not understand
where they come from as a repair and service manager; second, I think our company needs to
have a professional HR manager to do such things. I just want to do what I should be doing
during my three-year assignment at the UK subsidiary. I think it would be easier for a
professional HR manager from HQ to explain to subsidiary staff to accept the HQ’s HRM
practices. (Line Manager – Techco1, January 2009)

Expatriate disseminative capacity

In their role of knowledge source, the expatriate managers faced several difficulties in
connection with their ability to communicate and transfer HRM knowledge to host
employees, based first and foremost on their lack of absorptive capacity illustrated above.
More specifically, the expatriates’ disseminative capacity was shown to be negatively
affected by a lack of HRM knowledge, which hampered efforts at teaching and convincing
local managers and employees about the reasons behind the introduction of the parent’s
HRM practices. In addition, disseminative capacity was affected by the reported low
quality of social interactions between the expatriates and local staff due to (a) the
expatriate being perceived as lacking credibility in terms of HR competence and (b) the
language barrier.
A common issue that arose during the interviews was that knowledgeable local HR
managers (n ¼ 4) were resistant to the implementation of HRM practices transferred from
the parent. This was partly explained as being because the expatriates in top management
felt they could not convince experienced local HR managers of the reasons behind the
transfer of the parent’s HRM and partly because local HR managers preferred to adopt
local HRM practices. For example:
I experienced difficulties regarding how to implement HQ’s HRM practices such as the
performance appraisal system. All I can do is ask managers and employees to accept it without
question [ . . . ]. I would like to explain why we have to implement such productivity targets in
the performance appraisal system but I cannot. I have no HR background and knowledge
about it. (MD – Techco2, November 2006)
Due to their inability to explain why the parent HRM practices should be implemented, out
of fear of losing face in the eyes of employees and in order to avoid conflict, many
expatriate managers (n ¼ 51) confessed to not being able to carry out implementation as
planned. This was especially the case in situations where the HRM practice in question
presented a potential clash in cultural values such as the introduction of behavioural
performance indicators based on loyalty and respect for seniors:
I was unwilling to explain to local managers and employees why we had to implement the
HQ’s HRM practices. This is partly because I have no ability to do so as a result of lack of
HRM knowledge and partly because I do not want to lose face if I face huge challenges
2404 Y-Y. Chang and A. Smale

from local employees [ . . . ]. Consequently, I was unable to preserve the core values of
HQ’s HRM practices such as loyalty and respect to seniors. (Line Manager – Tranco2,
May 2007)
Since the expatriates had only been told to implement these HRM systems without any
training in the purpose behind these systems, many (n ¼ 58) felt that they did not have the
requisite HRM knowledge or experience to convince local management. This, in turn, led
to feelings that they did not possess much credibility in the eyes of local managers.
For example:
I face challenges from the local HR manager in particular because he thinks it is more
appropriate to implement local HRM practices, especially the performance appraisal.
However, I am unable to explain because I have no HR knowledge and have simply been told
by HR people at HQ to implement it. I know I was viewed as an untrustworthy manager in
local employees’ eyes. (MD – Tranco2, July 2008)
Another characteristic of expatriates that affected their ability and willingness to transfer
parent HRM knowledge was the language barrier. Typical of Taiwanese MNCs, the
international staffing policy in the four companies was to send experienced parent-
country mangers abroad to implement MNC targets and maintain tight control of
operations. However, the experienced expatriate managers (n ¼ 37) were not very
competent in English, which restricted their ability to communicate effectively with
host-country employees. Furthermore, their in-depth knowledge of HQ was not balanced
with in-depth knowledge about the host country (e.g. working attitudes, cultural values).
The expatriate managers thus felt frustrated in attempts to interact and communicate
with managers and employees, and again feared the potential conflict and loss of face
this would cause:
I would say that I am not good at English, especially spoken English. It is fine to implement
HQ HRM practices but I cannot explain them properly because of the language barrier. Also,
I feel that I am afraid of offending employees by asking them to have the same working
attitudes as mine. I cannot communicate with them again (about this) due to my English
problems. (Production Manager – Techco1, April 2008)
In three of the firms (Techco2, Tranco1 and Tranco3), the lack of disseminative capacity
seemed to lead to the expatriate managers (n ¼ 55) forming closer, more harmonious
relationships with local HR managers, even if that meant making concessions and
adaptations to parent HRM practices. For example:
I have to rely on the local HR manager to deal with labour disputes and communication
because he is familiar with British labour law and local culture. I mean, he has been working
in our company for many years too [ . . . ]. It is easier for me to maintain a good relationship
with the local HR manager, even if he is not willing to accept HRM practices transferred from
HQ. (MD – Tranco1, May 2008)
I have a good relationship with the local HR manager because he has been working in the
UK for more than 30 years. I have to ask him to cover most of the (HR) administrative
tasks for me. I understand why he is not willing to use HRM practices from HQ, but
I have no time to deal with these administrative issues as a MD. (MD – Techco2, January
2009)
It should be noted that in these three subsidiaries the local HR manager had worked in the
same company or industry for 15 – 20 years. Whilst MDs said they relied on local HR
managers to deal with labour disputes and communication with local staff, the same local
HR managers were also described as using their expertise and position to affect
the attitudes of the expatriates themselves towards resisting other HRM practices coming
from HQ.
 The International Journal of Human Resource Management 2405

Discussion and conclusion

Based on 86 personal interviews with 60 expatriate managers in four UK subsidiaries
belonging to four Taiwanese MNCs, this study investigated the characteristics of
expatriates that affected their absorptive and disseminative capacity in receiving and
sharing parent HRM practices.
By applying a knowledge transfer perspective, the present study’s main contribution was
to shed light on how the characteristics of expatriate subsidiary managers affect the stickiness
of parent HRM practice transfers to foreign subsidiaries. The study’s secondary contribution
lies in its problematisation of the role of expatriates in the transfer process. Acknowledged as
being key actors in the transfer of knowledge and best practices (e.g. Hocking et al. 2004;
Riusala and Smale 2007; Wang, Tong, Chen and Kim 2009) and parent HRM practices more
specifically (e.g. Harris and Holden 2001; Cerdin 2003; Smale 2008a), expatriates are often
expected to assume the role of parent HRM knowledge recipient (from corporate HQs) as well
as parent HRM knowledge source (to local managers and employees). However, in the light of
the fact that subsidiary expatriate managers are seldom HR professionals and rarely possess
work experience or education in HR, expatriates are likely to experience difficulties in the
HRM practice transfer process. Lastly, the present study contributes to our understanding of
the above issues in the under-researched context of HRM transfers from an NIE MNC parent
to a developed economy subsidiary (Chang et al. 2007).
In terms of absorptive capacity, the expatriates’ non-HR functional background and lack
of HR experience inhibited their ability to understand certain HR concepts, why the parent
HRM practices were being transferred and how the practices were supposed to support the
attainment of business objectives. This was confounded by a general reluctance to approach
corporate HR for help or advice. Taken together, this led to frustration and a lack of motivation
to learn new parent HRM practices. For MDs, the lack of motivation was not expressed as due
to a lack of understanding, but due to the relatively low priority ascribed to HRM together with
evidence of ‘satisficing’ insofar as they believed they knew enough about managing people in
foreign subsidiaries. The unwillingness of the Taiwanese expatriates to seek advice from
corporate HR and learn about parent HRM practices could be attributed to their Confucian
value orientation of ‘protecting face’ (Wu 2004), but may also reflect the emphasis in
Taiwanese MNCs to use expatriates to enforce compliance via output and behavioural control
(e.g. Chang et al. 2009).
In terms of disseminative capacity, expatriates experienced difficulties as parent HRM
knowledge source first and foremost due to their lack of absorptive capacity. This often
manifested itself in situations where expatriate managers were unable to convince local
employees, managers and especially HR managers as to why parent HRM practices were
superior and needed to be implemented. Rendering this task all the more challenging was the
reported low quality of social interactions between the two parties, due to both the language
barrier and the perceived lack of trust in the expatriates’ HR competence. For these reasons,
combined with local HR persuasion, the respondents described many situations in which they,
willingly or unwillingly, made concessions about whether to adopt the parent HRM practices
as intended. The importance of maintaining harmonious interpersonal relationships and
avoiding conflict in Taiwanese culture (e.g. Chen et al. 2005) appeared to produce a notable
negative impact on the disseminative capacity of the expatriate managers in this regard.
Importantly, this also offers a different micro-level explanation behind the use of local
and hybrid HRM practices in Taiwanese subsidiaries (cf. Chang et al. 2007) and in MNC
subsidiaries more generally.
2406 Y-Y. Chang and A. Smale

Although expatriate presence is a common predictor of parent HRM transfer (typically

measured as the degree of parent resemblance of subsidiary HRM practices; e.g. Rosenzweig
and Nohria 1994; Björkman et al. 2008), this study provides evidence to suggest that
expatriates can nevertheless experience significant difficulties in facilitating such transfers
and in some senses be considered a barrier themselves. Echoing recent HRM literature on the
important roles played by line managers in explaining the HRM–performance relationship
(e.g. Purcell and Hutchinson 2007), the present study supports a focus on such individuals – in
this case, subsidiary expatriate managers. Indeed, more research that focuses on the micro-
level characteristics and behaviours of senior subsidiary managers (expatriate or host-country
national) is needed since, as key actors, their attitudes are likely to influence how parent HRM
practices are enacted and perceived by other line managers and employees (Bowen and
Ostroff 2004). We believe that applying a knowledge transfer perspective and investigating
the absorptive and disseminative capacity of expatriate managers (cf. Bonache and Zárraga
2008) would be a constructive way to pursue this. This is not only because subsidiary
expatriate managers are acknowledged as having to confront competing pressures and thus
motivations for global standardisation and local adaptation (e.g. Banai and Reisel 1993), but
also because they are seldom HR professionals with the kinds of HRM abilities necessary to
facilitate smooth learning and teaching processes.
The study’s findings also support a focus on interpersonal relationships and the quality of
social interactions between expatriate managers and other key actors in the HRM transfer
process. In line with Cerdin’s (2003) theoretical model, the present study found support for the
importance of relationships between expatriates and both corporate HR and local employees.
Furthermore, there was evidence that the impact of these two competing pressures was
mediated by expatriates’ perceptions of role discretion (over the design and implementation of
parent HRM practices) and the quality of their intercultural interactions. In terms of role
discretion, the study highlighted the disadvantage expatriates experienced from not feeling
competent at explaining decisions concerning parent HRM. Applying the micro-political (or
power-based) approach to HRM in foreign subsidiaries and ‘how actors seek to protect or
advance their own interests, the resources they use, and the resolution of conflicts’ (Edwards,
Colling and Ferner 2007, p. 203), it is possible to see how the expatriate’s ability to explain
corporate HR decisions could play an important role in the continuous, contested process of
negotiation that is suggested to characterise the parent–subsidiary relationship (Ferner et al.
2004). However, our study shows that this ability will be severely tested for expatriates from
NIEs (e.g. Taiwan) operating in developed host-country environments (e.g. the UK). Based on
this study, we would certainly include expatriate managers (especially parent-country
nationals) in what Rupidara and McGraw (2011) refer to as ‘HR actors’ (in addition to
subsidiary HR managers), i.e. those who play a significant role in the configuration of HRM
practices in an MNC subsidiary. Research into the absorptive and disseminative capacity of
expatriates and how it affects negotiations about HRM with other key HR actors such as
subsidiary HR and line managers in different institutional settings would thus be an interesting
avenue for future studies.
The study’s findings also reinforce the importance of high-quality interpersonal
relationships between expatriate managers and local line and HR managers in facilitating
the transfer of HRM practices. The findings support the view that social capital (i.e. the
resources embedded within a network of relationships) between these parties is not only
supportive of HRM implementation amidst cultural and institutional diversity (Taylor
2007), but also necessary in moving beyond implementation towards the internalisation
(i.e. commitment to and belief in the value) of the transferred HRM practices (Björkman
and Lervik 2007). In order to facilitate the internalisation of parent HRM practices in
 The International Journal of Human Resource Management 2407

Taiwanese-owned subsidiaries, parent-country nationals are therefore faced with the

daunting prospect of establishing high-quality social relationships with key local actors
without relying on personal connections (quanxi) and respect for seniority. Similar to the
study by Truss and Gill (2009), future studies might therefore seek to investigate how
the level of social capital between corporate HR, subsidiary line managers/expatriates and
subsidiary HR affects the HRM practice transfer process and other HRM outcomes.
However, the present study must be viewed in the light of its limitations, which
themselves represent opportunities for further research. First, whilst the present study
focused on expatriate characteristics and the relation to their absorptive and disseminative
capacity, future work may extend this to focus on behavioural variables. This would not
only enable us to shed more light on the HRM process, i.e. the psychological mechanisms
through which expatriate managers translate their perceptions about parent and local HRM
into behaviours, which send signals to employees (see e.g. Bowen and Ostroff 2004;
Wright and Nishii 2007), but also provide valuable insights into the nature of the HR and
line manager relationship.
Second, the study focused exclusively on expatriate managers and did not include the
views of other key actors. In future studies, and based on the present study’s findings, a
broader stakeholder approach could be adopted in which the views of corporate HR,
expatriate managers, host-country managers, subsidiary HR and a sample of subsidiary
employees could be included. Not only would this allow for a more holistic account of
individual ‘HR actor’ roles and characteristics and how these affect the configuration of
HRM practices throughout the MNC (Rupidara and McGraw 2011), but also it would
allow us to determine the pertinence of interpersonal relationships from either a social
capital or micro-political perspective.

Implications for practitioners

In MNCs that hold a strong belief in the value of their HRM practices developed at HQs and
that wish to transfer them to foreign subsidiaries, the use of expatriates appears to be an
effective tool of HRM integration. However, for reasons highlighted in this study, corporate
HR should seek to ameliorate the challenges faced by expatriates in their role as HRM
knowledge transferors by taking a number of measures. First, they could adopt a ‘systems’
approach to global integration and complement the use of expatriates with a range of other
formal and informal structural mechanisms of HRM transfer (see e.g. Smale 2008a; Ferner
et al. 2011). Second, in line with Bonache and Zárraga (2008), the abilities and motivation of
expatiates could be supported through greater attention on the characteristics, attitudes and
cross-cultural competences of expatriates during screening and pre-departure training, and by
designing HRM practices (e.g. performance management, reward) that promote knowledge
transfer. Lastly, as advocated by Evans et al. (2011), MNCs should ensure that there is a
sufficient degree of international mobility amongst corporate and subsidiary HR
professionals, both within and outside of the HR function. This will not only help to raise
HR professionals’ awareness of the business realities faced by expatriate managers and thus
how to communicate with them convincingly about HRM, but also help them in
understanding the need for harmonised HRM practices and how best to overcome the barriers
that may arise in different subsidiary settings.

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