The paper “ Strategies for International HR Management of Multinational Corporations from Emerging Country” is a brilliant example of the literature review on human resources. Institutional theory helps in understating the intense pressures on MNCs from underdeveloped countries (DiMaggio and Powell 1983). Institutional theory is based on the fact that coercive and normative problems in the environment that result in organizations having to change their practices according to the Host country. According to Kim and Gray (2005) the above mentioned competitive pressures which exert pressure on organizations to imitate their competitors in the marketplace, taking into consideration practices that have proven to be effective and can be applied in their international operations. Thus as per the Institutional theory, the before mentioned pressures are based on the postulation that the best possible strategies, decisions, and practices may be considered at any particular point (Kostova and Roth 2002).
International markets give rise to greater homogenization, as the organizations contend with similar products and pace of the technological changes taking place in the market (Duysters and Hagedoorn 2001). Therefore, it is can be said, the HRM practices of MNCs may change into an emerging global paradigm, or, maybe, a more model that promotes developed countries (Smith and Meiksins 1995). Keeping in mind the Institutional theory, If management policies in an MNC develop towards assimilation, there is a `country of origin effect'- whereby most MNCs start activities in a region and have a single headquarters.
When an MNC comes into a new country, it may bring its own unique organizational culture or international HRM policies or adopt local employment laws. Many writers may stress that local or `host country' effect is more compelling than the `country of origin' effect with regards to HRM practices e. g., in the African system of work organization, the head of the group is seen as the father and is expected to provide for the group members.
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