The combination of Institutional theory and cultural dimensions' theory in HRM practices implementation. Case studies of Finnish companies in Russia.

Abstract

Purpose – Previous studies have revealed the lack of research in relation to the role of institutional and cultural dimensions’ theories on HRM practices of Finnish multinationals operating in Russia. Therefore, the purpose of this study was to investigate the connection mentioned above and gain a solid understanding of possible similarities and differences between HRM practices in the parent unit and subsidiary. Design/methodology/approach – This study uses deductive approach and establishes a framework based on the literature review that was tested through the semi-structured interviews. Embedded case studies supplement the thesis with empirical findings. The sample is restricted to Finnish companies operating in Russia. The data from the interviews was processed together with the theoretical framework provided. Key findings – The research findings demonstrate that international differences (both institutional and cultural) existing within Finnish MNCs in Russia tend to diminish due to the existing unified corporate policies on HRM practices. However, the results still prove the existence of those differences to a certain extent. Research limitations/implications – This research is limited conceptually, methodologically and empirically. The major conceptual limitation implies on the theoretical framework provided. Methodologically, the study is restricted by the choice of research design consisting of multiple case studies. Empirically, the study is limited by the sample size of five companies. Value of the research – The study contributed to the existing research base. Firstly, it is one of the very few studies which combine the two named theories in one study. Secondly, it expands the discussion on HRM practices in this regard. Moreover, this research is unique in terms of the case countries chosen. To sum up, it provides HR managers from Finland and Russia with some invaluable tips when operating globally.