This paper examines the effect of company internationalization on the practice of outsourcing HRM functions in Greece. It holds the assumption that HRM outsourcing is perceived as an innovative practice and that foreign multinationals (MNCs) will use this practice more than native ones do. In doing that, the study aims at examining whether ‘diffusion’ of loosely- regulated management practices such as HRM outsourcing, is sustained by foreign multinationals. The findings of the 2000 CRANET survey are presented to show that HRM outsourcing is used to a lesser extent in Greece than other Western economies. Then the hypothesis that MNCs outsource more HRM services than Greek companies do is tested. The analysis draws upon the findings of a survey addressed to HR directors of both foreign multinationals and Greek companies. A significant difference is found in the extent of HRM outsourcing between Greek companies and foreign multinational subsidiaries. This is adequately explained through the comparison of the way HRM is conducted in Greek each type of company, as well as the segregation of the Greek market for HRM services. The paper adds to the discussion on the role of multinationals in the diffusion of innovative managerial practices, as well as to the HRM convergence–divergence debate.
Keywords: Outsourcing, human resource management, multinationals, Greece, convergence
Muhammad, your question is not only valid but highly relevant in this age of internationalisation. Recently, I co-authored a couple of papers on a similar set of issues, which you may find beneficial:
Mendy, J., Rahman, M., & Bal, P. M. (2020). Using the “best‐fit” approach to investigate the effects of politico‐economic and social barriers on SMEs' internationalization in an emerging country context: Implications and future directions. Thunderbird International Business Review.
Mendy, J., & Rahman, M. (2019). Application of human resource management's universal model: An examination of people versus institutions as barriers of internationalization for SMEs in a small developing country. Thunderbird International Business Review, 61(2), 363-374.
Mendy, J., & Rahman, M. (2019). Application of HRM's Universal Model: an examination of people vs institutions as barriers of internationalization for SMEs in a small developing country. Thunderbird International Business Review, 61(2), 363-374.
Rahman, M., & Mendy, J. (2019). Evaluating people-related resilience and non-resilience barriers of SMEs’ internationalisation. International Journal of Organizational Analysis.