ASAP - Career development paper (just the limitations section)

International performance appraisal practices and approaches of South Korean MNEs in China

Haiying Kang a and Jie Shen

b *

a Australian Institute of Business, School of Management, Adelaide, Australia;

b Shenzhen

International Business School, Shenzhen University, Shenzhen City, Guangdong Province, China

International performance appraisal of multinational enterprises (MNEs) in foreign subsidiaries has received inadequate research attention. The current study investigates the international performance appraisal practices, including procedures and methods, criteria and feedback, of South Korean MNEs in China and the extent to which these practices are localized or/and ethnocentric. Results of analyzing the in-depth interviews with local and expatriate managers show South Korean MNEs tend to adopt an ethnocentric approach to managing performance appraisals for expatriates and an integrative approach for host country-nationals by transferring their home appraisal practices to their Chinese subsidiaries. These approaches can be attributed to relative strength effects, i.e. the relative economic strengths and contextual differences between China and South Korea. This study adds to the knowledge base of how MNEs manage performance appraisals in their foreign subsidiaries.

Keywords: China; international performance appraisal; South Korean MNEs

International performance appraisal is an important strategic international human resource

management (IHRM) function, which enables multinational enterprises (MNEs) to

evaluate and continuously improve individual, subsidiary and corporate performance

against clearly defined, pre-set objectives that are directly linked to international strategies

(Festing, Knappert, Dowling, & Engle, 2012; Vo & Stanton, 2011). International

performance appraisal is an important measure for MNEs to control the behaviors of

expatriates as well as host country nationals (HCNs) to ensure that foreign subsidiaries

perform in appropriate ways; that is, in the interests of the corporation as a whole

(Dowling, Festing, & Engle, 2013). Because international performance appraisal

influences promotion, compensation and reward, it plays a critical role in meeting

employee expectations and influencing employee perceived organizational support and

justice, job satisfaction and motivation (Festing et al., 2012; Logger & Vinke, 1995).

Consequently, international performance appraisals influence employee work attitudes

and behaviors as well as to international business performance and competitiveness of

MNEs.

Surprisingly, international performance appraisal has thus far received inadequate

research attention. Moreover, past empirical research, such as, Shen (2005), Suutari and

Tahvanainen (2002) and Vo and Stanton (2011), mainly explored international

performance appraisal practices for expatriates. Performance management for HCNs

has been largely ignored. As a result, little is known about how MNEs manage

international performance appraisals; leaving an important knowledge gap in the IHRM

literature. Approaches, such as localization, ethnocentric and integrative or hybrid, to

IHRM in general, have been at the center of IHRM research attention during the past three

q 2015 Taylor & Francis

*Corresponding author. Email: [email protected]

The International Journal of Human Resource Management, 2016

Vol. 27, No. 3, 291–310, http://dx.doi.org/10.1080/09585192.2015.1039562

decades due to the importance of appropriate IHRM approaches in helping MNEs to

achieve the best organization–environment fit (Pudelko & Harzing, 2007; Schuler,

Dowling, & Cieri, 1993). However, there is scarce research exploring international

performance appraisal approaches. Hence, the literature remains by and large incomplete

about how MNEs manage international performance appraisals and what approaches they

adopt and why in foreign subsidiaries. Therefore, there is an urgent need for more research

to explore international performance appraisal policies and practices and approaches.

The current research takes a step toward filling the abovementioned gap in the

international performance appraisal literature by exploring how South Korean MNEs

manage performance appraisals and the extent to which the appraisal policies and

practices are localized, or ethnocentric in China. To achieve this objective, we will address

the following two research questions:

1. How do South Korean MNEs manage international performance appraisals

including l procedures, methods and criteria and feedback provision for both

expatriates and HCNs in their Chinese subsidiaries?

2. What are the approaches, e.g. localized or ethnocentric, to international

performance appraisal practices of South Korean MNEs in China?

We will compare the international performance appraisal practices of South Korean

MNEs in China against those of local Chinese firms and those of South Korean firms in

South Korea in order to analyze the extent of localization and being ethnocentric. South

Korean companies, such as Samsung, LG and Hyundai, have rapidly emerged as strongly

competitive global players during the last few decades (Park, Ali, & Chevalier, 2011).

However, there is a paucity of research investigating how Korean MNEs appraise their

employees in foreign subsidiaries. South Korean MNEs have invested heavily in China

since the early 1990s and since then, the number of Korean MNEs setting up operations in

China has grown rapidly. Since 1998, over 4000 South Korean factories have moved their

production out of South Korea (Hart-Landsberg, 2004). Most of these have gone to China.

In 2001, China overtook the United States (US) as South Korea’s No. 1 investment

destination (Hart-Landsberg, 2004). The number of Korean MNEs operating in China rose

from 1772 in 2001 to 4685 in 2006 (The Export-Import Bank of Korea, 2012). The scale of

Korean investment in China underscores the importance of studying Korean MNEs’

international performance appraisal practices in China. China is the second largest

economy in the world and the most important foreign direct investment destination.

Research into international performance appraisals in China will also have significant

implications for MNEs in general. To summarize, the current study tries to explore the

international performance appraisal practices and approaches of South Korean MNEs in

China. Next, we review the literature on international performance appraisal practices,

appraisal practices in China and Korea, and international performance appraisal

approaches.

Literature review

International performance appraisal practices

Appraisal procedures and methods

How performance of expatriates is appraised has been a central concern in the IHRM

literature (Dowling et al., 2013). It is argued that the major factors pertaining to fairness in

performance appraisals are knowledgeable supervisors, chance given to employees to

H. Kang and J. Shen2292

challenge and perhaps change a performance rating, treating employees equally and

appropriate appraisal frequency (Blau, 1999; Gabris & Ihrke, 2001; Martin & Bartol,

2003; Taylor, Tracy, Renard, Harrison, & Carroll, 1995). Given the complexity of

evaluating expatriate performance, it has been suggested that raters of expatriate

performance appraisals include direct supervisors and peers in both the foreign

subsidiaries and the home country (Gregersen, Hite, & Black, 1996). Immediate

supervisors are usually considered well qualified to evaluate overall performance

(Mendenhall & Oddou, 1991), while peers are seen as the best-informed sources on

performance due to their beneficial placement for close observation of expatriates’ work

behavior (Cleveland, Murphy, & Williams, 1989; Harris & Schaubroeck, 1988; Murphy &

Cleveland, 1991). Accurate expatriate performance appraisals depend on the raters having

adequate knowledge of the expatriate’s assignment (Landy & Farr, 1980). Particularly in

the expatriate setting, the extent of this knowledge is often affected by the rater’s location;

that is, whether he or she is in the home or host country. HCNs in general would be the

more appropriate expatriate performance appraisal raters due to their being more familiar

with the soft criteria and contextual factors, and thus having greater knowledge concerning

expatriate performance (Briscoe & Claus, 2008; Mendenhall & Oddou, 1991). One

limitation of using HCN managers as raters is that they evaluate expatriate performance

within their own cultural contexts, and thus do not necessarily focus on issues important to

the MNE as a whole (Briscoe & Claus, 2008). As a result, it is important for MNEs to

specify in advance the most important performance areas for the term of the assignment

and indicate who will appraise each area (Logger & Vinke, 1995). For example, in most

US and Finnish MNEs, expatriates’ immediate supervisors (either HCNs or senior

expatriates) in foreign subsidiaries rate expatriate performance (Gregersen et al., 1996;

Suutari & Tahvanainen, 2002).

From the perspective of fairness, it is important that the employee knows who is

ultimately responsible for evaluating his or her performance (Varma & Budhwar, 2011).

The use of multiple raters including supervisors, peers, subordinates, customers, high-

level managers, and the employees themselves is helpful in minimizing psychometric

errors in appraisals (Appelbaum, Roy, & Gilliland, 2011). Self-assessment in particular

provides employees with a chance to be more involved and committed to their personal

goals and to have a level of control over the strength and direction of their evaluations

(Jawahar, 2006).

Formal performance appraisals are normally conducted on an annual basis.

Sometimes, organizations require that appraisals to be done more frequently (Martin &

Bartol, 2003). Frequent performance appraisals can result in employees having a greater

understanding of their jobs, with subsequent improvement in job performance (Cascio,

1998; Nathan, Mohrman, & Milliman, 1991). Infrequent appraisal may inhibit the

timeliness of corrective actions and stall continuous improvement initiatives (Chiang &

Birtch, 2010). Gregersen et al. (1996) reported that both biannual and annual expatriate

performance appraisals are regarded as appropriate and related positively to perceived

expatriate performance appraisal accuracy. Two empirical studies by Suutari and

Tahvanainen (2002) and Shen (2004) investigated appraisal frequency for expatriates and

revealed that Finnish MNEs and Chinese MNEs tend to conduct appraisals annually.

Appraisal criteria

Clearly defined performance appraisal criteria help to increase accuracy in performance

rating and create organizational climates of fairness and trust (Cleveland, Lim, & Murphy,

The International Journal of Human Resource Management 3293

2007; Tziner, Murphy, Cleveland, & Roberts-Thompson, 2001). The basic performance

appraisal criteria used in MNEs are hard goals, soft goals and contextual goals (Gregersen

et al., 1996). Hard goals are objective and quantifiable; measuring performance such as

production, return on investment, sales and profits (Whitford & Coetsee, 2006). It has been

suggested that because results-oriented measures only consider a small portion of job

performance, the use of hard goals is hence associated with many problems (Muchinsky,

2002).

Compared to hard goals, soft goals are more subjective. Soft goals take into account

factors that are difficult to quantify, such as work attitudes and behavior, leadership skills,

interpersonal skills and customer service quality (Janssens, 1994). Assessing soft goals is

important in performance appraisals in the international setting (Maley & Kramar, 2007;

Milliman, Taylor, & Czaplewski, 2000). However, the use of soft goals is also not without

limitations. For example, the focus on effort and behavior instead of on outcomes

encourages some employees to pretend to be busy and to cultivate their relationships with

their superiors to gain promotion (Cooke, 2008). Contextual goals take into account

environmental factors that have an effect on employee performance (Dowling et al., 2013;

Gregersen et al., 1996). The use of comprehensive criteria increases the accuracy of

expatriate performance appraisals (Gregersen et al., 1996). In the West, performance

appraisals focus more on job competence, abilities and achievements. Less emphasis is put

on personality, attitudes and interpersonal relationships (see, Siders, George, &

Dharwadkar, 2001).

Feedback

Identifying employee strengths and weaknesses, assessing training needs and creating

targeted skill supply strategies have become appraisal’s modern business imperatives

(Chiang & Birtch, 2010). Providing appropriate feedback can communicate performance

gaps relative to expectations and guide training and development plans aimed at increasing

the skills and capabilities of human capital (Cardy & Dobbins, 1994; Sully De Luque &

Sommer, 2000; Fenwick, 2004; Milliman et al., 2000; Williams, 2002). According to the

main theories of work motivation such as goal setting theory (Locke & Latham, 1990) and

control theory (Carver & Scheier, 1982), effective self-regulation toward goals consistently

requires the types of performance feedback inherent in high-quality international

performance appraisal. Research shows that feedback provision in international

performance appraisal has positive effects on job satisfaction and work attitudes and

behavior among international assignees (Jawahar, 2006; Lindholm, 1999). Due to

geographic distance between supervisors and subordinates, providing frequent, timely and

accurate feedback may be challenging for international managers (Shen, 2004). Some

scholars suggest that multi-evaluators could be a solution to this challenge (Suutari &

Tahvanainen, 2002). Whether, how and what feedback is given are strongly influenced by

national cultures (Briscoe & Claus, 2008; Cascio, 2006). For example, in Asian cultures,

indirect feedback or feedback provided to employees via a mutually respected third party

may be seen as more appropriate than Western-style direct feedback (Stone, 2008).

Performance appraisals in China and South Korea

South Korean companies have been slow in adopting multi-rater systems (Jhun, Bae, &

Rhee, 2012). Assessment by superiors is the dominant form of performance appraisal in

South Korean domestic firms (Yang & Rowley, 2008). In Korea, supervisors are often

H. Kang and J. Shen4294

required to keep a diary (‘Manager’s Note’) on the performance, grievances and

development needs of subordinates, and to share the diary with them. During the annual

‘Appraisal Week’, interviews with supervisors are carried out to evaluate the performance

and capability of employees. During these interviews, employees and supervisors

exchange and discuss evaluation results, adjust differences in their opinions and agree on

final ratings (Kim & Briscoe, 1997). In contrast, in Chinese domestic firms, employees are

normally expected to carry out written self-evaluations on an annual basis. The self-

evaluations are then discussed at departmental meetings involving all employees

(Easterby-Smith, Malina, & Yuan, 1995). However, for the sake of ‘saving face’ and not

affecting ones’ bonus, these departmental meetings normally do not discuss areas for

improvement. Consequently, these meetings do not provide any genuine, useful feedback

(Shen, 2008). The main appraisal criteria in Korean domestic firms include quality of

work, ability, interpersonal skills, leadership skills, work attitudes (Kim, 2001) and

personality (Tan & Torrington, 1998). In China, the same criteria as in Korea are used.

In addition, Chinese firms assess employee moral standards and ideological attitudes and

behaviors; that is, Party loyalty (Cooke, 2008).

In Chinese domestic firms, feedback from appraisers to appraisees is often minimal

(Zhu & Dowling, 1998). It is not much different in Chinese MNEs, in which employees do

not normally receive feedback, especially when feedback could be negative (Shen, 2004).

In Korean domestic firms, although managers do not usually give explicit feedback to

subordinates (Kim, 2001), appraisees receive implicit feedback through reading

‘Manager’s Notes’ and having two rounds of discussions with supervisors about their

performance and capability (Kim & Briscoe, 1997).

International performance appraisal approaches

It is widely accepted that one of the key challenges for MNEs is to manage the dual

pressure of global integration and local responsiveness due to contextual and firm-specific

effects (Brewster, Wood, & Brookes, 2008; Evans, Pucik, & Barsoux, 2002; Rosenzweig,

2006). The impact of this dual pressure on MNEs is typically reflected in IHRM practices

that vary significantly in terms of localization and standardization (Chung, Bozkurt, &

Sparrow, 2012). International performance appraisal is seen as one of the most

complicated management practices because different institutional systems, values and

cultures all come into play (Appelbaum et al., 2011; Chiang & Birtch, 2010; Fletcher &

Perry, 2001; Paul Huo & Von Glinow, 1995; Suutari & Tahvanainen, 2002).

According to Shen (2004), MNEs can adopt three alternate approaches – ethnocentric,

localized and integrative – to managing international performance appraisals. The

ethnocentric approach transfers the performance appraisal practices of the home company

to the foreign subsidiary (Shen, 2004). This is due to the country-of-origin effect, whereby

the appraisal practices in foreign subsidiaries resemble those of the parent company more

than they do those of local firms. There are two major reasons for MNEs to transfer home

appraisal practices abroad. First, MNEs might believe their home practices are superior to

the practices of companies in host countries. As Schuler et al. (1993) argued, an MNE with

an ethnocentric orientation will be likely to ‘impose policies concerning staffing,

compensation, performance appraisal, and management development which reflect parent

country practice rather than sensitivity to local environment’ (p. 447). Second, the MNE

might be new to the international market or a particular host country and thus be

inexperienced in localizing, which requires the home company to make significant

changes to their management styles for implementation in a host country. ‘The longer

The International Journal of Human Resource Management 5295

firms operate internationally, the more likely they are to change their practices to

accommodate local or regional demands if the situation deems it appropriate’ (Schuler

et al., 1993, p. 451). The localized approach is the adoption of local performance appraisal

practices in response to the host nation’s institutional influences. The ethnocentric

approach to managing appraisals brings consistency (that is, it ensures the equality of

conditions for expatriates residing in different locations), ease of operation for expatriate

managers and ease of interpretation by headquarters of appraisal results. The main

disadvantage of this approach is a lack of local responsiveness, which often results in

resistance from HCNs. Conversely, the main advantage of the localized approach is

responsiveness to host environments, while the disadvantages are inequality between

subsidiaries and the possible loss of control by headquarters (Shen, 2005).

The integrative approach is the adoption of the ‘best-fit practices’ by integrating the

home and host performance appraisal practices as well as good appraisal practices

implemented by other MNEs (Shen, 2005). This approach can potentially achieve local

responsiveness, coordination and internal consistency simultaneously. It is important for

MNEs to take into account a range of contextual and firm-specific factors to achieve the

best organization–environment fit when selecting IHRM approaches (Schuler et al.,

1993). The best-fit IHRM practices for a MNE are not necessarily those copied from the

well-known role models of American, Japanese and German enterprises (Smith &

Meiksins, 1995). When a MNE regards an HRM practice as suitable for implementation

across all of its foreign locations, regardless of local institutional influences, the MNE can

be said to have adopted a globalized IHRM approach, which Pudelko and Harzing (2007)

believe is caused by dominant effects, i.e. the best practices for all firms. This global

approach has received criticism for its impracticability due to its lack of consideration for

local institutional influences (Shen, 2005). There are many factors influence MNEs’

IHRM approaches. Schuler et al. (1993) argue that the host contextual factors including

political, legal, economic, social and cultural factors and the firm-specific factors

including strategy, structure, organizational culture, internationalization mode and

experience determine IHRM approaches. In supporting Schuler et al. (1993), Vo and

Stanton (2011) argue that cultural and institutional similarities between the host and home

countries result in localization of international performance appraisal practices. This

indicates that localization may not be universally suitable for MNEs. Pudelko and Harzing

(2007), however, have a different view arguing that the relative strength between the host

and home economies determines IHRM approaches. For instance, Pudelko and Harzing

(2007) found that when the US economy was dominating, Japanese and German

subsidiaries in the US followed US HRM practices, while US subsidiaries in Japan and

Germany tended to adopt the parent company’s HRM practices. Meanwhile Japanese

subsidiaries in Germany and German subsidiaries in Japan all adopted an integrative

approach. Myloni (2002) similarly found that US companies adopt the ethnocentric

approach to HRM practices in their Greek subsidiaries. These MNEs tend to transfer their

home appraisal practices to foreign subsidies. When relative strengths are not apparent,

MNEs may tend to adopt an integrative approach.

Methodology

Yin (2009) suggests that the exploratory case study approach should be used if the research

tests a concept or theory that does not have much knowledge about and mainly answers

‘what’ and ‘how’ questions. The case study approach is therefore a preferred method

for this study given that international appraisal practices and approaches are

H. Kang and J. Shen6296

under-researched. We collected the data mainly from semi-structured interviews with 20

senior managers in the subsidiaries of 10 Korean MNEs in China between August and

October 2011. We interviewed one Chinese manager and one Korean expatriate manager

who had some responsibilities for HRM in each case study. The case study companies

were involved in the electronics, telecommunications (mobile phones), online services,

automobile, advertising and information technology (IT) industries. The business

structures of the case study companies were consistent with the overall industry pattern of

Korean MNEs in China (The Export-Import Bank of Korea, 2011). The case study

company profiles are shown in Table 1. The interviewees’ profiles are shown in Table 2.

Interviews were conducted in Mandarin with Chinese managers and in Korean with

expatriate managers (the first author is bilingual). The interviewees were asked about

performance appraisal methods and procedures, appraisal criteria, and feedback for both

HCNs and expatriates. The interviews were tape-recorded and interview summaries were

sent to the interviewees for verification. Data were also collected through company

documents, reports (such as annual reports) and official websites. The qualitative data

were content analyzed by adopting a summative approach. With this approach, the authors

identified and compared the key themes and interpreted the underlying contexts. Coding

examples and exemplary themes are shown in Table 3.

To assist in analysis of the extent of localization or ethnocentric, a five-point Likert

scale of localization or standardization was developed, in which 1 represented completely

localized, 2 mostly localized, 3 integration, 4 mostly ethnocentric and 5 completely

ethnocentric. Two researchers independently scored each component of the international

performance appraisal practices. Differences were discussed to arrive at agreed scores.

Results

Appraisal procedures and methods

All of the interviewees reported performance appraisal was one of the most important

HRM functions in their companies due to its role in employee compensation, promotion

Table 1. Company profiles.

Company

Year of establishment in Korea/ China Industry

Location in China

No. of foreign

subsidiaries/ host

countries

No. of employees globally/ in

China Ownership in China

Telecom A 1997/2004 Online services

Beijing 4/4 400/76 FOE

Chemical A 1966/1992 Chemical Beijing 15/6 10,000/2000 FOE Telecom B 1984/1987 Mobile

phone Beijing 6/3 4,500/350 FOE

Advertising A 2005/2005 Advertising Beijing 10/5 350/30 FOE Telecom C 1984/2003 IT Beijing 1/1 4,500/58 JV Electronics A 1958/1993 Electronics Yantai 100/44 100,000/36,000 FOE Electronics B 1938/1992 Electronics Tianjin 57/65 680,000/69,000 FOE Auto A 1967/2002 Automobile Beijing 18/8 68,000/7,400 JV Finance A 1993/2005 Finance Beijing 2/2 2,375/20 FOE Telecom D 1999/2000 Mobile

phone Beijing 2/2 100/30 FOE

Note: FOE, Foreign-owned enterprise; JV, Joint-ventures.

The International Journal of Human Resource Management 7297

and career development. All case companies were clearly serious about performance

appraisals and had formulated formal appraisal policies in relations to procedures,

methods and criteria. All the interviewees agreed that their companies transferred some

appraisal practices, especially those for Korean expatriates that were regarded effective in

Korea and other international operations to China and at the same time considered local

situations. The case companies also differentiated appraisal procedures and methods for

expatriates and HCNs. In all case companies, performance appraisals for expatriates were

evaluated by managers in both subsidiaries and headquarters, regardless of appraisees’

hierarchal levels. Expatriates who were in low managerial positions reported to superiors

in both local subsidiaries and headquarters while senior expatriate managers reported only

to headquarters. Raters included immediate supervisors in local subsidiaries and in

headquarters, and departmental managers in headquarters. Generally, the procedures and

methods of expatriate appraisals were as follows:

. Step 1. Expatriates conducted self-evaluation periodically (mostly monthly) and uploaded the reports to company online evaluation systems.

. Step 2. Direct supervisors (either HCN managers or senior expatriate managers) in local subsidiaries then provided comments on expatriates’ performance. Note that,

although ‘onsite managers’ comments on performance of expatriates are extremely

important in ensuring expatriates to be accurately and fairly evaluated’ (HR

Manager in Electronics A), they did not usually have control over final appraisal

results.

. Step 3. Immediate supervisors in headquarters appraised expatriates’ performance based on expatriates’ self-evaluations and comments provided by supervisors in

foreign subsidiaries, and interviews with expatriates. Interviews took place mostly

in Korea. During interviews, immediate supervisors in headquarters and appraisees

discussed and mutually agreed on final grades.

Table 2. Interviewees’ profiles.

Company Position Age Gender Working years Education Nationality

Telecom A Operation manager 38 M 3 Bachelor Korean General manager 46 M 5 Master Chinese

Chemical A Marketing manager 41 M 3 Master Korean HR manager 40 M 3 Bachelor Chinese

Telecom B Chief operating officer 44 M 2 Bachelor Korean General manager 48 M 4 Bachelor Chinese

Advertising A Marketing manager 33 M 3 Bachelor Korean HR manager 40 F 4 Bachelor Chinese

Telecom C Operation manager 41 M 3 Bachelor Korean General manager 48 M 4 Diploma Chinese

Electronics A Marketing manager 43 M 3 Master Korean HR manager 45 M 4 Bachelor Chinese

Electronics B Finance manager 46 M 5 Bachelor Korean General manager 41 M 4 Bachelor Chinese

Auto A Marketing manager 41 M 4 Bachelor Korean HR manager 46 M 3 Bachelor Chinese

Finance A Finance director 39 F 4 Bachelor Korean HR manager 45 M 3 Bachelor Chinese

Telecom D Operation manager 38 M 2 Bachelor Korean HR manager 46 F 2 Bachelor Chinese

H. Kang and J. Shen8298

. Step 4. Subsequently, supervisors passed on their evaluation results to departmental managers in headquarters for final approval.

Although expatriates conducted self-evaluations and their immediate supervisors

provided comments on expatriates’ performance frequently (normally monthly) (in order

to monitor expatriates’ performance, a common interviewees’ statement says), immediate

supervisors and departmental managers in headquarters conducted formal performance

appraisals for expatriates only biannually (Telecom B, Electronics A and Electronics B) or

annually (Chemical A, Telecom A, Advertising A, Telecom C, Auto A, Finance A and

Telecom D). Interviewees were also asked why performance appraisals for expatriates

needed to be conducted in headquarters rather than in Chinese subsidiaries. The following

quotation is a typical answer to this question:

The headquarters is responsible for compensation, training, promotion, expatriation, and manager transfer for expatriates. It therefore needs to know how well expatriates perform in subsidiaries and how competent they are in their respective roles in order to make well- informed decisions about the abovementioned issues that will have a significant effect on expatriates (Finance Manager, Electronics B).

Performance appraisals for HCNs were conducted in Chinese subsidiaries.

Headquarters did not play any direct roles in assessing HCNs’ performance. Seven

Table 3. Examples of coding and statements.

Category Coding Statement

Purpose Compensation promotion

‘We rely on performance appraisal results to determine employee promotion opportunities and their compensation’ (General Manager, Electronics B). ‘We consider individual performance in promotion and reward’ (General Manager, Telecom B). ‘Pay for employees is largely based on performance’ (Finance Director, Finance A).

Career development

‘Expatriates’ performance in international assignments may influence their future positions in company’ (Chemical A, HR Manager). ‘HCN managers were promoted from those who achieved excellent performance’ (Marketing Manager, Electronics A).

Procedure Self-evaluation ‘All individuals are required to submit self-evaluation reports as part of performance appraisal procedure’ (General Manager,Telecom C).

Appraisal interview

‘On-site supervisors conduct interviews with expatriate managers. The appraisal results, however, need to be approved by senior managers at headquarters’ (HR Manager, Telecom D).

Method Rater ‘Direct supervisors in the subsidiary are supposed to monitor expatriates’ performance and comment on expatriates’ self- evaluations’ (HR Manager, Advertising A). HCNs’ performance is appraised through self-evaluation and direct supervisors’ (Marketing Manager, Electronics A).

Frequency ‘We conduct appraisal annually. Normally, self-appraisals take place in the mid-December. Interviews with supervisors are conducted in the mid-January. Appraisal results are finalized before the Chinese New Year’ (HR Manager, Auto A).

Criteria Work performance

‘We put 50% weight on task completion’ (HR Manager, Telecom A).

Attitudes ‘We assess work attendance, attitudes toward clients’ (HR Manager, Finance A).

Feedback Feedback ‘My supervisor is reluctant to provide me with written feedback. However, he gives me advice on how to improve my performance’ (Marketing Manager, Advertising A).

The International Journal of Human Resource Management 9299

companies, including Telecom A, Chemical A, Telecom B, Telecom C, Electronics A,

Electronics B and Auto A, used multiple raters in appraising HCNs’ performance. Raters

included immediate supervisors, co-workers, peers and departmental managers.

A common reason for the use of multiple raters was: ‘We use multiple raters to ensure

we do not miss anything in employee performance so that we conduct appraisals fairly and

accurately.’ The performance appraisal procedures for HCNs in these seven firms included

the following steps:

. Step 1. HCNs completed self-evaluation reports using standard forms and submitted their reports to immediate supervisors.

. Step 2. Once immediate supervisors received the reports, they sought comments from employees’ co-workers and peers.

. Step 3. Next, immediate supervisors had meetings with employees to discuss their performance and to determine mutually agreed appraisal results, which were

recorded using grade systems.

. Step 4. The appraisal results were then forwarded to departmental managers for final approval. The approved results were put into the employees’ personnel files,

for use in determining compensation, employees’ attendance at training and

promotion.

In the remaining three Korean MNEs, only immediate supervisors and departmental

managers were raters. The appraisal procedures in these three firms differed from those in

the other seven Korean MNEs in two important ways. First, there was no consultation with

peers or co-workers. Second, there were two rounds of interviews with supervisors, with

one focusing on performance and the other on capability.

Overall, performance appraisals were conducted more frequently for HCN production

workers than for office workers. There were also different frequencies for HCN office

workers and for production workers across the case companies. For office workers in

Chemical A, Advertising A, Telecom C, Electronics A Office, Electronics B Office, Auto

A Office, Finance A and Telecom B, performance appraisals were conducted annually,

usually at the end of the year. For the other two firms, performance appraisals for office

workers were conducted biannually. For production workers in Electronics A, Electronics

B and Auto A, performance appraisals were conducted twice a year, at the end of June and

December.

Appraisal criteria

According to the interviewees, all case companies had formulated formal written

performance appraisal criteria, broadly including work performance, work attitudes,

competence and company loyalty; the four major components that underpin key

performance indicators (KPI) for evaluating both expatriates’ and HCNs’ performance.

All case companies adopted a grade system to classify employee performance. As a

General Manager in Telecom C explained:

Once an employee’s performance is assessed, a grade (A to E) will be assigned. A represents outstanding, B good, C satisfactory, D poorly, and E unacceptable. Each grade was associated with a certain level of bonus, ranging from 5 percent to 10 percent of employees’ compensation.

There were similarities in appraisal criteria for expatriates across the case companies.

Headquarters set KPIs for expatriates at the beginning of each year. Work performance

was mainly related to the standards of job task completion and productivity. Work

H. Kang and J. Shen10300

attitudes emphasized attendance, customer service, teamwork, expatriate relationships

with HCNs, supervisor–subordinate relationship and moral standards/work ethics. Work

competence focused on knowledge of work and skills and ability required to do particular

jobs. Company loyalty was about commitment to companies and jobs, and company

promotion. The difficulty in assessing expatriates’ relationships with HCNs was often

mentioned in interviews. A typical response was given by Operation Manager (expatriate)

in Telecom C:

A good relationship with HCNs may not be an effective relationship. Managers in the headquarters often do not understand this difference. For example, if an expatriate strictly implements the company’s disciplinary policies, this expatriate may not be popular among HCNs. For this reason, this expatriate’s relationships with some HCNs may not sound good. Therefore, it is important to investigate the nature and causes of the problems rather than just giving the expatriate a poor appraisal if there is a relationship problem.

Consequently, The fulfillment of job responsibilities is regarded as the most important

criterion for expatriates and it weighs at least 50 percent of the overall performance score

in my company’s grading system (Operation Manager in Telecom C). No Korean MNEs

included Party loyalty in appraisal criteria when operating in Communist ruled China.

When asked why, a typical answer was ‘Party loyalty is irrelevant to our company as we

are not interested in politics’ (HR Manager, Finance A).

Composition and weighting of subcomponents of appraisal criteria for HCNs were also

similar across the case companies. For example, in Telecom A, 50% of assessment weight

was given to employee performance (task completion), 30% to competence (work ability

and leadership) and 20% to work attitudes (for example, cooperation and absenteeism).

In Telecom B, completion of task accounted for 50%, work attitude 30% (effort 15% and

team spirit 15%) and competence 20% (knowledge 10% and responsibility 10%). Peers (or

co-workers) evaluation (also called horizontal evaluation) accounted for 10% of the

overall score in Telecom A and supervisor evaluation (also called vertical evaluation)

accounted for 90%. Similar weightings were implemented in other Korean MNEs. Again,

the work performance of office workers as compared to production workers was evaluated

differently in all case companies. As HR Manager in Electronics A said: ‘Production

workers are assessed against product quantity and quality while office workers are against

general tasks.’ Appraisal criteria for expatriates and HCNs in each company are

summarized in Table 4.

Feedback

As face-to-face interviews were conducted, oral feedback was provided to appraisees

(both expatriates and HCNs) during the interview process. Written feedback was only

provided to HCNs whose performance was classified as Grade E (the fifth grade). A typical

statement was:

Employees who receive E grade normally request feedback. Direct supervisors are on the frontline to provide feedback that recognizes and congratulates achievement and identifies the improvement areas and training needs. Departmental managers provide feedback as well if there are requests from employees. Of course, underperformers also received written warnings as well.

In addition to oral feedback, Telecom A, Chemical A, Telecom B, Telecom C,

Electronics A, Electronics B and Auto A provided written feedback online to expatriates

regardless of performance standards. Some expatriates from Advertising A, Finance A and

Telecom D that had not been provided with written feedback expressed their

The International Journal of Human Resource Management 11301

T a b le

4 .

P e rf o rm

a n c e a p p ra is a l c ri te ri a .

C o m p a n y

W o rk

p e rf o rm

a n c e

W o rk

a tt it u d e

C o m p e te n c e

P a rt y /C o m p a n y lo y a lt y

T e le c o m

A T a sk

C o m p le ti o n : E X P /

H C N

(þ * )

T e a m w o rk : E X P /H C N (þ

), a tt e n d a n c e : E X P /

H C N

(þ * ), in te rp e rs o n a l re la ti o n sh ip : H C N

(þ )

K n o w le d g e : E X P (þ

); w o rk

sk il ls /a b il it y :

E X P /H C N

(þ ), la n g u a g e a b il it y : H C N

(2 )

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

C h e m ic a l

A T a sk

C o m p le ti o n : E X P /

H C N

(þ * )

R e la ti o n sh ip

w it h H C N s: E X P (þ

), re sp o n si b il it y : E X P (2

), H C N (þ

), te a m

w o rk : H C N

(þ ), in te rp e rs o n a l re la ti o n sh ip :

H C N

(þ )

K n o w le d g e : E X P /H C N

(þ ), le a d e rs h ip /

c o a c h in g sk il ls : E X P (2

), w o rk

a b il it y : E X P /

H C N

(þ )

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

T e le c o m

B T a sk

C o m p le ti o n : E X P /

H C N

(þ * )

W o rk

e ff o rt : E X P /H C N (þ

), te a m w o rk : E X P /

H C N

(2 ), m o ra l st a n d a rd : E X P (2

), re sp o n si b il it y : E X P /H C N

(þ ), a tt e n d a n c e :

H C N

(þ )

K n o w le d g e : E X P /H C N

(þ ), w o rk

a b il it y :

E X P /H C N

(þ ), la n g u a g e a b il it y : E X P /H C N

(2 )

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

A d v e rt is in g

A T a sk

C o m p le ti o n : E X P /

H C N

(þ * )

T e a m

w o rk : E X P /H C N

( þ ), c o m p li a n c e w it h

c o m p a n y ru le s: E X P /H C N

(þ ), in te rp e rs o n a l

re la ti o n sh ip : H C N

(þ ), c u st o m e r se rv ic e :

H C N

(þ )

P ro fe ss io n a l/ w o rk

sk il ls : E X P /H C N

(þ ),

c re a ti v it y : E X P (þ

), H C N (2

) C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

T e le c o m

C T a sk

C o m p le ti o n : E X P /

H C N

(þ * )

S u p e rv is o r- su b o rd in a te

re la ti o n sh ip : E X P

(2 ), re la ti o n sh ip

w it h H C N s: E X P (þ

), te a m

w o rk : H C N

(2 ), c o m p li a n c e w it h c o m p a n y

ru le s: H C N

(þ ), in te rp e rs o n a l re la ti o n sh ip :

H C N

(þ ), a tt e n d a n c e : H C N

(þ )

P ro fe ss io n a l/ w o rk

sk il ls : E X P /H C N

(þ ),

le a d e rs h ip : E X P (þ

), k n o w le d g e : H C N

(þ )

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

E le c tr o n ic s

A T a sk

C o m p le ti o n : E X P /

H C N

(þ * ),

p ro d u c ti v it y : H C N

(þ )

R e sp o n si b il it y : E X P /H C N

(þ ), te a m

w o rk :

E X P /H C N

(2 ), in te rp e rs o n a l re la ti o n sh ip :

H C N

(þ )

P ro fe ss io n a l/ w o rk

sk il ls : E X P /H C N

(þ ),

la n g u a g e a b il it y : E X P (2

), le a d e rs h ip : E X P

(þ ), c re a ti v it y : E X P /H C N

(þ )

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

E le c tr o n ic s

B T a sk

C o m p le ti o n : E X P /

H C N

(þ * ),

p ro d u c ti v it y : H C N

(þ )

R e la ti o n sh ip

w it h H C N s: E X P (þ

), su p e rv is o r- su b o rd in a te

re la ti o n sh ip : E X P /

H C N

(þ ), a tt e n d a n c e : H C N

(þ ), c o m p li a n c e

w it h c o m p a n y ru le s: H C N

(þ ), c re a ti v it y :

E X P /H C N

(2 )

L e a d e rs h ip : E X P (2

); p ro fe ss io n a l

k n o w le d g e /s k il ls : E X P /H C N

(þ )

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

(C o n ti n u e d )

H. Kang and J. Shen12302

T a b le

4 – c o n ti n u e d .

C o m p a n y

W o rk

p e rf o rm

a n c e

W o rk

a tt it u d e

C o m p e te n c e

P a rt y /C o m p a n y lo y a lt y

A u to

A T a sk

C o m p le ti o n : E X P /

H C N

(þ * ),

p ro d u c ti v it y : H C N

(þ )

T e a m

w o rk : E X P /H C N

(þ ), re sp o n si b il it y :

E X P /H C N (þ

), a tt e n d a n c e : H C N

(þ ),

in te rp e rs o n a l re la ti o n sh ip : H C N

(þ )

L e a d e rs h ip : E X P (þ

), w o rk

sk il ls /a b il it y :

E X P /H C N

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

F in a n c e A

T a sk

C o m p le ti o n : E X P /

H C N

(þ * ),

p ro d u c ti v it y : H C N

(þ )

R e sp o n si b il it y : E X P /H C N

(þ ), c o m p li a n c e

w it h c o m p a n y ru le s: E X P /H C N

(2 ),

in te rp e rs o n a l re la ti o n sh ip : H C N

(þ ),

a tt e n d a n c e : H C N

(þ ), c u st o m e r se rv ic e :

H C N

(þ )

P ro fe ss io n a l/ w o rk

k n o w le d g e a n d sk il ls : E X P /

H C N

(þ ), le a d e rs h ip : E X P (2

); c o m m u n ic a ti o n sk il ls : E X P (2

)

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

T e le c o m

D T a sk

C o m p le ti o n : E X P /

H C N

(þ * ),

p ro d u c ti v it y : H C N

(þ )

R e sp o n si b il it y : E X P /H C N

(þ ), re la ti o n sh ip

w it h p e e rs /s u p e rv is o rs : E X P /H C N

(2 ),

a tt e n d a n c e : H C N

(þ )

L e a d e rs h ip : E X P (2

); in te rp e rs o n a l sk il ls :

E X P (2

), p ro fe ss io n a l/ w o rk

k n o w le d g e :

E X P /H C N

(þ )

C o m p a n y lo y a lt y : E x p /

H C N (þ

), P a rt y lo y a lt y : E x p /H C N

(n /a )

N o te s: E x p , e x p a tr ia te ; H C N , h o st c o u n tr y n a ti o n a l; þ * , v e ry

st ro n g ; þ , st ro n g ; 2 , w e a k ; n /a , n o t a p p li c a b le .

The International Journal of Human Resource Management 13303

dissatisfaction with this deficiency. A typical statement was made by Marketing Manager

(expatriate) in Advertising A: ’I would rather receive negative feedback from my superior

than be removed from the position without knowing what I have done wrong.’

Discussion

The current study explored how performance appraisals for expatriates and HCNs are

conducted and the approaches to international performance appraisal in South Korean

MNEs operating in China. Our results show expatriates’ performance is evaluated through

self-evaluations and interviews with direct supervisors and relevant departmental

managers in headquarters. Direct supervisors in Chinese subsidiaries assist in appraisals

by providing comments on subordinating expatriates, but they do not determine appraisal

results. Department (or co-worker group) discussions, which are commonly used for

appraisals in Chinese companies, are not used in performance appraisals for expatriates in

Korean MNEs. Clearly, the case study South Korean MNEs tended to adopt standardized

(i.e. the home-based) performance appraisal procedures and methods for expatriates.

Similar to the findings of the current study, Taylor, Cho, and Hyun (2001) found that

Korean MNEs in India involved line managers (supervisors) and HR officers in appraisals.

Seven out of 10 case companies evaluated HCNs’ performance through self-

evaluations, supervisors’ consultation with peers and co-workers, and interviews with

direct supervisors. While consultation with peers or co-workers is a modified form of

group discussion, conducting interviews with supervisors is not a conventional Chinese

way of appraising performance. This indicates that performance appraisals for HCNs in

these seven Korean MNEs integrated the localization and ethnocentric approaches, but

with a strong tendency toward the ethnocentric approach. This provides some support to

Zou and Lansbury (2009), which reported Hyundai also gradually adopted an integrative

approach to some of the HRM practices, e.g. a combination of the seniority-based and

performance-based appraisal system, in its Beijing subsidiary. In the other three remaining

firms (Advertising A, Finance A and Telecom D), consultation with co-workers was not

conducted, and self-evaluations and interviews with supervisors were the major appraisal

methods. Therefore, appraisals for HCNs in these three firms were ethnocentric. This

finding provides some support to the literature that Western MNEs (i.e. US, Canada) tend

to adopt an ethnocentric approach to manage performance appraisal when operating

overseas (Chen & Eldridge, 2010; Gregersen et al., 1996; Vo & Stanton, 2011). Similar to

the case Korean MNEs, Chinese MNEs tend to adopt different performance appraisal

approaches for different nationals and managerial levels (Shen, 2004).

Work performance, work attitudes and competence are the three major performance

appraisal criteria for both expatriates and HCNs. Different from local Chinese firms;

Korean MNEs do not consider Party loyalty as an appraisal criterion. Local Chinese firms

generally emphasize work attitudes and moral standards/work ethics. Differently, Korean

MNEs put more weight on work performance, while still taking into account work

attitudes and moral standards/work ethics. Korean MNEs also put more weight on

interpersonal relationships in HCNs’ appraisals than in expatriates’ appraisals. These

results show that appraisal criteria of Korean MNEs tend to be ethnocentric for expatriate

appraisals but integrative for HCN appraisals. These finding are generally in alignment

with Lansbury, Kwon, and Suh (2006) and Taylor et al. (2001), which revealed Korean

MNEs’ appraisal criteria include work performance, behavior, attitudes, team work and

attendance. Industry wise, the firms in service sectors including Advertising A, Finance A

H. Kang and J. Shen14304

and four telecom firms put more weight on work attitudes, such as attendance and

customer service.

In local Chinese firms or Chinese overseas MNEs, Chinese appraisers normally do not

communicate feedback, especially negative feedback to appraisees (Cooke, 2008; Shen,

2004). Different from their Chinese counterparts, Korean MNEs provide feedback to all

appraisees during face-to-face interviews, and provide additional written feedback to

underperformers. Korean MNEs are therefore ethnocentric in giving feedback. Table 5

presents the authors’ assessment of the extent of localization and ethnocentric of the

international performance appraisals of South Korean MNEs using the aforementioned

scoring method. Overall, as the table shows, the international performance appraisal

practices of South Korean MNEs tend to be ethnocentric. These findings are consistent

with the study of Zou and Lansbury (2009), which reported the Hyundai Motor Company

tended to transfer its core HRM practices that are beyond appraisal practices from its

headquarters to the Beijing joint venture in order to maintain control over employment

relations.

This research contributes to the IHRM literature and to the international performance

appraisal literature in particular in several ways. First, there is a paucity of research

exploring international performance appraisals (Festing et al., 2012). Exploring

international appraisal practices and approaches, this research hence adds to the

knowledge base on international performance appraisals of both HCNs and expatriates.

Second, little research has explored the international performance appraisal practices of

South Korean MNEs. A review of the literature has unearthed only three studies, namely

Lansbury et al. (2006), Taylor et al. (2001) and Zou and Lansbury (2009), that provided

some empirical data on appraisal practices of Korean MNEs. However, none of the three

studies extensively explored performance appraisal practices or examined appraisal

practices for expatriates. This research helps to fill this literature void. Third, and most

importantly, this research is one of a few that explores the approaches to international

performance appraisal practices and provides some evidence for analyzing the underlying

factors.

One interpretation of why Korean MNEs adopt the ethnocentric approach to managing

international performance appraisal practices is that this research provides some support to

Pudelko and Harzing (2007) who advocate for the relative strength effects. MNEs

Table 5. Extent of localization and standardization of the international performance appraisals of South Korean MNEs in China.

Procedures and methods Criteria Feedback Overall

HCN Expat HCN Expat HCN Expat HCN Expat Overall

Telecom A 3 5 4 5 5 5 4 5 4.5 Chemical A 3 5 4 5 5 5 4 5 4.5 Telecom B 3 5 4 5 5 5 4 5 4.5 Advertising A 5 5 4 5 5 4 4.7 4.7 4.7 Telecom C 3 5 4 5 5 5 4 5 4.5 Electronics A 3 5 4 5 5 5 4 5 4.5 Electronics B 3 5 4 5 5 5 4 5 4.5 Auto A 3 5 4 5 5 5 4 5 4.5 Finance A 5 5 4 5 5 4 4.7 4.7 4.7 Telecom D 5 5 4 5 5 4 4.7 4.7 4.7

The International Journal of Human Resource Management 15305

originating from advanced economies where the best management practices are supposed

to exist (Smith & Meiksins, 1995). HCNs in underdeveloped or developing countries may

be more likely to expect MNEs originating from advanced economies to manage people

differently from local companies by bringing in the best practices. The Korean economy (a

developed economy) has the relative strength over the Chinese economy (a developing

economy). Korean MNEs may believe their home appraisal practices to be superior to

those of Chinese firms, therefore, more suitable for their Chinese subsidiaries despite there

are cultural and institutional differences between the two countries.

Limitations and directions for future research

Like other studies, this research has several limitations. This research was conducted in

two national contexts involving South Korea and China. This did not enable the authors to

explore whether South Korean adopt the global approach to international performance

appraisal practices. It would be helpful to replicate this research in multiple host countries,

and MNEs from less-developed economies investing in developed economies. Similarly,

this study did not test the relative strength effect by examining whether MNEs originating

from less-developed economies investing in more advanced economies tend to localize

their performance appraisal practices. Hence, the interpretation of the reasons for South

Korean MNEs’ adoption of an ethnocentric approach is not compelling. Therefore, it is

necessary to conduct future research involving MNEs originating from and operating in

varied economies in order to provide convincing evidence to test the relative strength

effect. Vo and Stanton (2011) suggest that culture and institution are not static. This

research collected the data at one point of the time. The Chinese economy is developing

fast and its culture is changing too. Future research may adopt the longitudinal approach to

explore the changes to relative strength effects on international performance appraisal

approaches. Moreover, the sample size is small. Future research should employ a larger

sample to increase the generalizability of research findings. Finally, the data for this study

were collected from managerial employees; non-managerial employees may have

different insights into performance appraisal practices. Hence, future studies should

consider collecting data from both manages and non-managerial employees.

Managerial relevance

The findings of this research have significant implications for MNEs to manage

performance appraisals for both expatriates and HCNs. MNEs always need to make

critical decisions on approaches to their international performance appraisal practices. The

overwhelming advice from academics so far is to localize, as localization is believed to

have many benefits for MNEs. However, the findings of this study suggest that it is more

important for MNEs originating from advanced economies to adopt international

performance appraisal approaches with their own characteristics, reflecting the national

institutional influences of their own home countries. For MNEs originating from less-

developed economies, it is important that they analyze their management strengths and the

acceptability of their appraisal practices to HCNs when selecting approaches to

international performance appraisals. However, it needs to note that the transfer of the

home system may not be always successful due to lack of local employees’ support and

high cultural discrepancies (e.g. Chen & Eldridge, 2010; Pudelko & Harzing, 2007; Vo &

Stanton, 2011). Hence, we suggest that MNEs consider adopting integrative approaches to

managing international performance appraisals for both expatriates and HCNs.

H. Kang and J. Shen16306

Concluding remarks

How MNEs conduct international performance appraisals and adopt appraisal approaches

has received little research attention, despite the importance of performance appraisals

having been widely recognized. This research provides important insights into how

Korean MNEs manage and what approaches they adopt to managing performance

appraisals in their Chinese subsidiaries. It reveals that South Korean MNEs tend to adopt

the ethnocentric approach to managing performance appraisal practices for expatriates and

an integrative approach for HCNs in their Chinese subsidiaries due to the relative strength

effect and contextual differences between China and South Korea. Based on the findings of

this study, it can be argued that the ethnocentric approach may be appropriate for MNEs

originating from advanced economies to operate in less-developed countries, and a multi-

domestic (localized) approach may be effective for MNEs from less-developed economies

to operate in developed countries.

Disclosure statement

No potential conflict of interest was reported by the authors.

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