Human resource practices in the multinational company

Article Critique Summary: “Human resource practices in the multinational company: a test of system, societal and dominance effects”
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In the article Edwards et al (2013), highlight on the relevance of the system, societal and dominance effects (SSD) model in explaining the HR practices relied upon by multinational companies (MNCs). Even though, MNCs may follow global and national practices, system and dominance effects have varying impact on HR practices in the U.K. Canada, Ireland and Spain. The authors support this view by highlighting that nations have specific traditions that affect the business climate, while there are nations with dominant systems which can be adopted by other countries. The interplay of societal, system and dominance aspects interact to influence HR practices, where adoption of HR practices is not uniform across countries.
U.S. MNCs have operated in more diversified countries, and the authors rightly point out that H.R practices are more common in liberal market economies (LMEs) than in coordinated market economies (CMEs). This highlights on the dominance effect in more liberal markets. On the other hand, countries where labor unions and government involvement in the economy is stronger leave MNCs with few choices when relying on HR practices. This is consistent with societal effects as subsidiaries of MNCs the CSEs impose more restrictions on businesses than LSEs (Edwards et al., 2013). There is an element of adaptation where MNCs utilize certain aspects of U.S. HR practices while also integrating local HR practices in the host countries. Depending on the society, opportunities and business environments, MNCs subsidiaries embed diverse practices to improve business opportunities.
To assess the SSD framework appropriateness for understanding international HR practices in MNCs, the authors test the effects of the framework. Since the article highlights on differences in HR practices depending on country operations, this validates the observation that societal effects do exist and influence HR practice (Edwards et al., 2013). In order to highlight on dominance effects, the authors point out that that HR practices from the dominant economy have more influence, and in this case the U.S influence practices in other countries. The researchers focused on HR practices from the country of origin and compared with that of subsidiaries in the host country. Hence, use of forced distributions in appraisal was found to be more common in US firms, and the practice was adopted in host countries more often in comparison to non U.S firms. Equally, system effects are more common in cases where there are weak associations of societal and dominance effects.
The study findings are releva...