A Study On Staffing And Motivational Patterns Of Host Country Nationals And The Influence To Knowledge Flow

Localization is the goal of multinational corporations at the beginning of the entrance of Chinese market. However, after 20 years development, there is appearing an anti-localization trend. The quit rate of line workers, middle managers and even top managers is increasing. Then, we ought to think about, what changed localization into anti-localization? What kind of factors multinational corporations must consider when staff managers for oversea subsidiaries? What kind of motivational patterns are used for host country nationals? And such a staffing can influence the knowledge flow management or not? Therefore, this research is significant to enrich the theory exploration of staffing and motivation of host country nationals of oversea subsidiaries; and at the same time, to provide suggestions to Chinese enterprise to better compete in international market.The main contributions of the research are as follows.â‘ With the application of transactional cost theory, analyzes the antecedents of management staffing in subsidiaries. And the empirical results tell us that operation time is negative related with expatriate rate; specialty of HRM, the degree of central control, the difference between parent country and host country are positive related with expatriate rate.â‘¡With the application of psychological contract theory, game theory, analyzes the motivational patterns for host country nationals. And the empirical results tell us that the lack of'interpersonal obligation'in organization's obligations in Chinese subsidiaries, glass ceilings and the lack of effective training plan, result in the lack of employee's trust of organization and consequently lead to the high quit rate.â‘¢Analyzes the influence of staffing host country nationals to knowledge flow management. And the empirical results tell us that staffing is closely related with knowledge flow management; and the innovation ability and knowledge integration ability of Chinese subsidiaries are still weak.â‘£The structural equation model is constructed to test the relationship between staffing host country nationals, motivational patterns and knowledge flow management. And the empirical results tell us that training and promotion can not only directly influence the quantity of knowledge inflows, but also can mediate the negative effect of staffing to internal knowledge inflows. And material incentive can help host country nationals absorb knowledge and information and strength their learning capacities.The main features and innovations are as follows.â‘ This dissertation uses the transactional cost theory as the theoretic analysis base and defines four costs in staffing host country nationals, and regression analysis is used to test the hypothesis. This is an exploratory and innovative way to explain why multinational corporations choose expatriates in stead of local people as top and middle managers.â‘¡Psychological contract theory is applied to explain why quit rate is increasing. The theoretic reasoning and confirmatory factor analysis show that employees and companies have different understanding of the psychological contract. Chinese employees believe that interpersonal obligation should be included in the organizations'obligations, but companies do not think their obligations consist of interpersonal ones. Thus, employees may lose loyalty to the organization, and consequently, more and more host country nationals quit their jobs.â‘¢Game theory is applied to explain why quit rate is increasing, too. The theoretic reasoning and regression analysis show that there exist'glass ceilings'and at the same time the training plan is deficient. The popular opinion that multinational corporations are featured as fair promotion path and good training plans, yet, the results of this research are different but are reasonable and persuasive.â‘£This research finds out the mediation effect of motivational patterns in the relationship of staffing and knowledge flow. Good motivational patterns can mediate the negative effect of staffing to internal knowledge inflows. And material incentive can help host country nationals absorb knowledge and information and strength their learning capacities. These findings will be useful for Chinese multinational corporations to improve their human resource management and knowledge flow management as well.