Human resource management in multinational companies: Effects of
national, organizational and professional culture on HR practices and
organizational performance
Final Report, December 2012
Prof. Yitzhak Fried
Dr. Hilla Peretz
Dr. Shlomit Kaminka
Whitman School of Management
Syracuse University
721 University Avenue,
Syracuse, NY 13244-2450
Email: yfried@syr.edu
Department of Industrial
Engineering and Management
Ort Braude College, Israel
Snunit 51 St, Karmiel, Israel
Email: hillap@braude.ac.il
Department of Behavioral Sciences
The College of Management
Academic Studies
Rabin 7 Blvd., Rishon Letzion, Israel
Email: skaminka@netvision.net.il
Submitted to the SHRM Foundation
1
Index
page
3
Abstract
Chapter 1:
Background and purpose of the study
4
Chapter 2:
The study’ questions and model
8
Chapter 3:
Methodology
9
Chapter 4:
Results
12
4.1 Results- introduction
12
4.2 Results- part 1
15
4.3 Results- part 2
23
4.4 Results- part 3
36
4.5 Results- part 4
50
4.6 Results- part 5
52
4.7 Results- part 6
55
4.8 Summary of the results
58
Conclusions and implications
60
Chapter 5:
62
References
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Abstract
Our goal in the present study was to explore the following: (a) how the level of congruency
among three cultures (national, organizational, and professional) are related to psychological,
behavioral and organizational performance outcomes; (b) how national, organizational, and
professional cultures are related to employees’ preferences for different human resource
practices; (c) how national, organizational, and professional cultures are related to the actual
characteristics of human resource practices implemented by organizations; and (d) how the level
of congruency between employees’ preferences of HR practices and the actual HR practices
affects psychological, behavioral and organizational performance outcomes. The study was
based on new data that was collected from eight global multinational companies, in 19 different
countries (USA, Israel, India, Ireland, Italy, France, the Netherlands, Germany, Spain,
Switzerland, Romania, Serbia, Russia, Poland, Czech Republic, Australia, Uruguay, Mexico and
Argentina), and across 59 subsidiaries (a total of 1631 employees and HR managers). In
addition, we conducted qualitative interviews with 11 HR managers. The results indicated that
national culture has the strongest effect on preferred HR practices, while organizational culture
has the strongest effect on actual HR practices implemented by the organizations. Second, we
showed that distance between the cultural types (national, organizational, and professional)
affect both preferred HR practices and actual HR practices implemented by the organizations.
Third, we supported the notion that when there is a lack of fit between employees’ preference of
HR practices and actual HR practices in the organization, the consequences on organizational
outcome indicators are negative. On the other hand, when there is a fit between preferred and
actual HR activities, organizational outcomes improve. Finally, we indicated that a lack of fit
between the three cultures tend to have adverse effect on psychological, behavioral and
performance indicators. The findings of the study have important theoretical and practical
contributions, which are discussed in this report.
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Chapter 1: Background and purpose of the study
The past few decades have been characterized by a growing trend toward globalization,
resulting in an increasing number of global and multinational business endeavors (e.g., Aycan
2005; Aycan et al., 2000). The increased economic globalization and the need to operate in
different countries and cultures have contributed to the challenges of maintaining and improving
business competitiveness (e.g., Aycan, 2005). Issues such as maintaining a balance between the
“home-based” culture and “local” cultures, maintaining high quality performance standards
across different locations and cultures, and maintaining productive collaboration between units
in different locations, have become critical for business success in this global economy. The
business operations of international and multi-national corporations in different nations and
societies have raised the importance of understanding the role of culture in explaining
organizational performance and employees’ attitudes and behaviors at work.
Interestingly, although there have been an ample number of studies on the effect of
national culture on attitudinal and behavioral outcomes, there is a paucity of research on the
underlying mechanisms that help explain the effect of culture on employees’ reactions and
organization performance (see a comprehensive meta-analysis review by Taras, & kirkman, &
Steel, 2010). Thus there is a clear need for research to examine the underlying mediators
between national cultures and organizational and individual work-related outcomes.
An important mechanism that can explain the degree of success of international and
multinational companies is the nature and characteristics of the human resource (HR) practices
these companies implement. Human resource practices such as selection, performance appraisal,
compensation, mobility between countries, layoff practices, and work arrangements (e.g.,
flextime, working from home) are crucial for organizational success (e.g., Aycan, 2005; Aycan
et al., 2000; Peretz & Fried, 2012). Indeed, HR has become an important strategic component of
organizations pursuing their strategic business goals (Ulrich, 1997; 1998; Ulrich & Brockbank,
2005).
However, the contribution of HR practices to employee positive work outcomes and
organizational success are highly contingent on the fit between the characteristics of the human
resource practices implemented in an organization, and the national culture in which the
organization is embedded (e.g., Peretz & Fried, 2012).
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The effect of HR practices can be discussed on the basis of two alternative approaches: the
universalistic approach and the contingent approach. The universalistic approach to strategic
HRM posits that certain HRM practices are universally related to higher organizational
performance (Delery & Doty, 1996). This relationship is derived from the resource-based view
of the firm proposed by Barney (1991) and colleagues. However, other scholars, such Rousseau
& Fried (2001), have argued for a contingent impact of HRM practices on organizational
outcomes. Rogers and Wright (1998) suggested that despite evidence supporting the relationship
between HRM practices and organizational performance, this relationship is not universal or
consistent across all settings.
In order to fully understand the effect of HR activities on
organizational outcomes, it is necessary to understand the context in which the organization
exists. One key contextual variable that can affect the impact of HR activities is culture. Indeed,
the globalized economy has increased the importance of understanding the characteristics and
effects of HR practices in different environments. There is a growing discussion in the literature
suggesting that the characteristics and impact of HR practices are contingent on contextual
factors such as culture (cf. Gelfand, Nishii, & Raver, 2006; Johns, 2006; Robert et al, 2000;
Rousseau & Fried, 2001).
In the following section we will discuss in turn each of our cultural dimensions, and its
effect on HR.
National culture
Culture has been defined in many ways. One well-known anthropological definition is that
culture consists of patterned ways of thinking, feeling and reacting, acquired and transmitted
mainly by symbols, constituting the distinctive performances of human groups (Kluckhohn,
1951, p. 86). Since then, researchers have made several attempts to define and classify cultural
values (e.g., Aycan, et al 2000; Hofstede, 1991; Schwartz, 1999). Common themes in most of
these definitions and classifications are that cultural values are typically shared by members of a
society, are passed from older to younger members, and shape a collective perception of the
world.
In this study, we relied on five widely-studied cultural values at the national level: power
distance, individualism/collectivism, uncertainty avoidance, future orientation, and performance
orientation, also known as achievement orientation (Hofstede, 1980; House et al., 1999; 2004).
Power distance refers to the degree to which members of a collective expect power to be
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distributed equally (House et al., 2002; 2004). In high power distance societies, hierarchy is
rigidly adhered to and privileges are distributed unequally.
In such societies, higher-level
members are expected to preserve their relative advantage in status and power. In contrast, low
power distance societies are more concerned with preventing such inequalities among citizens.
Future orientation refers to the degree to which individuals in a society engage in future-oriented
behaviors such as planning, investing in the future, and delaying gratification (House et al.,
2002). Long-term orientation societies place a high value on persistence in the pursuit of goals.
In contrast, short-term oriented societies place a higher value on maintaining personal stability
and living for the present. Individualism/collectivism refers to the degree to which societies
value individual rights and opportunities versus group success and individual loyalty to the
group. In collectivistic societies individuals are expected to subordinate themselves to the
group’s goals and success. Individualistic societies place high value on personal freedom, selfexpression and individual performance. Uncertainty avoidance is defined as the extent to which
a society, organization, or group relies on social norms, rules, and procedures to alleviate the
unpredictability of future events (House et al., 2002; 2004).
Societies low in uncertainty
avoidance tend to value diversity and to be tolerant of differences in personal beliefs and
activities. Societies high in uncertainty avoidance tend to value conformity and to show lower
tolerance of people whose behaviors or beliefs differ from the norm. Performance orientation
refers to the degree to which societies value performance versus quality of life. Societies with
high performance orientation value assertiveness, success, competition, performance, and results.
Societies with a nurturing orientation value quality of life associated with warm personal
relationships and care and services to the weak.
Although national culture plays a critical role in individuals’ behavior (for example, Bajdo
and Dickson,2002, showed that GLOBE national values accounted for 40% of the variance in
women’s advancement in organizations), several researchers (e.g. Punnett, 1989; 2004; House et
al, 2004) suggested that other dimensions of culture (e.g. organizational culture, professional
culture) also influence individual behavior in organizations.
Organizational culture
In the past 25 years, the concept of organizational culture has gained wide acceptance as a
way to understand human systems. Edgar Schein, one of the most prominent theorists of
organizational culture, gave the following very general definition: “A pattern of shared basic
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assumptions that the group learned as it solved its problems of external adaptation and internal
integration, that has worked well enough to be considered valid and therefore, to be taught to
new members as the correct way to perceive, think, and feel in relation to those problems
“(Schein, 1992; p.373).
Hofstede (1991) defined organizational culture as the collective
programming of the mind, which distinguishes the members of one business organizations from
the members of another. Research has suggested that organizational culture contributes to
individual behavior in organizations (e.g., House, Dorfman, Hanges, & Sully de Logue, 2006;
Orelly, Chatman, & Caldwell, 1991).
However, the interface between societal- and
organizational-level culture has largely been neglected (Aycan, 2005).
In this study we tried to remedy this gap by examining five organizational-level values. In
order to compare the effects of national versus organizational values, we focus on the same five
values (power distance, individualism/collectivism, uncertainty avoidance, future orientation,
and performance orientation). We expect that psychological and behavioral outcomes (job
satisfaction, organizational commitment, absenteeism and turnover) will be most positive when
there is high convergence between both national and organizational couture and the HR
practices. We also expect that high convergence between national and organizational culture
will result in positive indicators of organizational performance (i.e., organizational growth rate
and decrease in expenses).
Professional culture
The extensive criticism of the integrative `shared values’ view of culture has prompted
many researchers to argue that one way of advancing culture research is by examining the ways
different subcultures interact in organizational settings.
Employees, especially those in
professional occupations, tend to share with one another values, norms and perspectives,
constituting a professional culture that extends beyond the organization to occupational
communities across organizations (e.g., Van-Maanen & Barley, 1984). There may be different
levels of convergence between professional culture and organizational or national cultures, and
this convergence or lack of convergence between the different cultures is expected to affect
employee attitudes and performance at work (cf. Aycan, 2005). In this study we use a measure
of professional culture developed by Herkenhoff (2010) that focuses on 5 dimensions that are
largely similar to the dimensions in the national and organizational cultures: power distance,
time orientation, risk, service focus, and team focus.
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To summarize, our cross-cultural research can introduce a new understanding of employee
attitudes and behavior in organizational settings. The importance of global studies such as this
one is increasing for multinational corporations (MNCs), as these corporations increase their
foreign geographic areas of operation. Within the 1990s, as Erez and Early (1993) have pointed
out, there has been an increase in the number of mergers and acquisitions that cross national
boundaries.
This may result in the cultural composition of the MNC changing overnight.
During 2008, global corporation shaken by the financial crisis attempted to adjust to the new
environment. Despite the importance of a global perspective, it remains difficult to generate
substantive studies linking all aspects of culture and HR practices in the global arena. This
research project attempts to remedy this deficiency by systematically exploring the prevalence
and effects of HR practices in the multi-level contexts of national, organizational, and
professional cultures. We expect this research to contribute to the literature on strategic human
resource management (HRM) by enhancing our knowledge and understanding of the competitive
advantage of HR practices for global companies, contingent on cultural contexts.
Chapter 2: The study’ questions
The goal of our study is to examine the following questions:
1. How does the fit/misfit among the three cultures (national, organizational, and
professional) relate to the examined psychological, behavioral and organizational
performance outcomes?
2. How do national, organizational, and professional cultures relate to employees’
preferences for different human resource practices?
3. How do national, organizational, and professional cultures relate to the actual
characteristics of human resource practices implemented by organizations?
4. How do employees react psychologically to a fit/misfit between their preferences for HR
practices and the actual implemented HR practices, in terms of job satisfaction,
organizational commitment, and satisfaction from HR practices?
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5. How does the fit/misfit between the employees’ HR practice preferences and the actual
HR practices relate to the organizational performance indicators of absenteeism, turnover,
and organizational performance outcomes?
 The study model appears in the appendixes file
Chapter 3: Methodology
Sample and procedure
Data for the study collected from eight global multinational organizations. Six of those
companies were hi-tech and two are low-tech.
The sample size was 1571 employees and 60 HR managers from 59 subsidiaries located in
19 countries (USA, Israel, India, Ireland, Italy, France, the Netherlands, Germany, Spain,
Switzerland, Romania, Serbia, Russia, Poland, Czech Republic, Australia, Uruguay, Mexico and
Argentina).
The complete surveys with the different scales are presented in the appendix file (tables 12).
The data for the quantitative study collected mainly using web-based questionnaires (see
appendixes file). Each company also provides data on the company’s growth rate indicators, as
well as rate of absenteeism and turnover for each of the participant organizations (subsidiaries).
In addition we conducted face to face qualitative interviews with 11 HR directors.
Variables and Measures
National culture: Measures of five Cultural values (collectivism, power distance,
uncertainty avoidance, future orientation, and performance orientation) were obtained from the
GLOBE database (House et al, 2004).
Global Leadership and Organizational Effectiveness (GLOBE) is a multi-phase, multimethod project in which investigators spanning the world are examining the inter-relationships
between societal culture, organizational culture, and organizational leadership. The GLOBE
Project was founded in 1993. Today, scholars from 61 countries representing all major regions
throughout the world are engaged in this long-term programmatic series of cross-cultural
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leadership studies. The meta-goal of the Global Leadership and Organizational Effectiveness
(GLOBE) Research Program is to develop empirically based theory and measurement tools to
describe, understand, and predict the impact of cultural variables on leadership and
organizational processes and the effectiveness of these processes.
Organizational culture: was measured by 15-item questionnaire base on GLOBE
organizational culture scale (House et al, 2004). These items measures five values: collectivism,
power distance, uncertainty avoidance, future orientation, and performance orientation. The
average reliability of this scale based on previous studies is 0.77 (House et al, 2004). The
reliability in our study is 0.76. We choose to use this measure in order to be able to compare
between similar values at the organizational and national levels (e.g. power distance, future
orientation etc., at the organizational and national level).
Professional culture: was measured by a 15-items scale developed by Herkenhoff (2010).
The scale measures five values: power distance, time orientation, risk, service focus, and team
focus. The average reported reliability is 0.81. The reliability in our study is 0.79. Each one of
the sampled employees in each organization completed the professional culture questionnaire.
We aggregated the results in each professional group in each organization after conducting a
statistical analysis of Rwg to test the level of homogeneity of the employees’ perception in a
group (see results). We then assign to each employee the mean score of their professional
group.
Descriptive statistics for national, organizational and professional culture are presented in
the appendix file (tables 3-5).
HR variables:
Employees' preferences for HR practices:
Was measured by 20-items scale developed for this study and completed by the
employees. The following practices were measured: performance appraisal preferences, flexible
work practice preferences, compensation preferences, recruitment preferences, autonomy in
decision making preference, mobility preference, and layoff process.
Descriptive statistics of employees' HR practice preferences are presented in the appendix
file (table 6).
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Actual HR practices:
Was measured by 24-items scale developed for this study and completed by the HR
managers.
The following practices were measured: performance appraisal, flexible work
practices, compensation, recruitment, autonomy in decision making, mobility, layoff process and
criteria.
Descriptive statistics of actual HR practices are presented in the appendix file (table 7).
Dependent Variables:
Psychological outcomes:
We used three scales to assess the psychological outcomes of organizational commitment, job
satisfaction and satisfaction with the different HR practices. These scales were completed by the
sampled employees.
Organizational Commitment: we used the Mowday, Steers & Porter organizational
commitment questionnaire (OCQ). The scale has received consistent support in the literature
(e.g. Meyer & Bobocel, 1991; Meyer et al, 2002). The scale’s reliability in our study is 0.75.
Job Satisfaction: we used the Hackman & Oldham’s (1976) 5- item scale from the Job
Diagnostic Survey. The reliability of this scale has received consistent support in the literature
(e.g. Hackman & Oldham 1975; 1976; Taber & Taylor 1990). The scale’s reliability in our study
is 0.71.
Satisfaction with the different HR practices. We assessed employees’ reactions to the
different HR practices that are used in their organization. The scale’s reliability in our study is
0.82. Thus, the reliabilities of the three scales are satisfactory.
Descriptive statistics of psychological outcome variables presented in the appendix file
(table 8).
Objective Organizational Behavioral Outcomes:
Absenteeism: average annually absenteeism (number of days) in each site
Turnover: average yearly turnover percentage in each site
Descriptive statistics for behavioral outcomes presented in the appendix file (table 9).
Objective Organizational Performance Outcomes:
Revenue: % change between 2010 and 2011 (at the company level)
Profit: % change between 2010 and 2011 (at the company level)
Operating cash flow: % change between 2010 and 2011 (at the company level)
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Stock price: as for 31 Dec 2011 (at the company level)
Differences in revenue, profit, and operating cash flow between the company and average
competitors (% change between 2010 and 2011 at the company level).
Descriptive statistics of organizational performance indicators presented in the appendix
file (table 10).
Chapter 4: Results
4.1 Results- Introduction
The results section is divided into six parts. Concerning the first five parts, each part
focuses on one of the five examined questions in this study. The last part summarizes the
qualitative interviews:
Part 1: examines how the fit/misfit among the three cultures (national, organizational, and
professional) is related to the examined psychological, behavioral and organizational
performance outcomes.
Part 2: examines how national, organizational, and professional cultures are related to
employees’ preferences for different human resource practices.
Part 3: examines how national, organizational, and professional cultures are related to the
actual characteristics of human resource practices implemented by organizations.
Part 4: examines how employees react psychologically to a fit/misfit between their
preferences for HR practices and the actual HR practices, in terms of job satisfaction,
organizational commitment, and satisfaction from HR practices.
Part 5: examines how the fit/misfit between the employees’ preferences for HR practices
and the actual HR practices is related to the organizational performance indicators
of absenteeism, turnover, and financial growth outcomes.
Part 6: provides a summary of the qualitative interviews.
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Analysis Strategy
We used multilevel analysis (hierarchical linear modeling; HLM) to model the structure of
the data (HLM; Raudenbush & Bryk, 2002). This method is appropriate given the fact that each
employee in our samples was nested under the corresponding country in which s/he operated. In
all analyses, we used the centering strategy recommended by Hofmann & Gavin (1998) and
Enders & Tofighi (2007). Specifically, we used group-mean centered level-1 variables and
grand-mean centered level-2 variables. This centering strategy is now the standard approach used
in the literature when examining level-2 variables as moderators of level-1 associations (Enders
& Tofighi, 2007). To test the cross-level equations, for each one of the equations, we estimated
two multilevel models. First, we estimated an unconditional model. This model revealed how
much variation in the outcomes is allocated across the three different levels. For the second
model (conditional model), we added to the equation the predictors. In the results section we
reported on the predictive coefficients (i.e., γ01, γ02) for the random intercept (β00) in each
equation.
For all the analyses, the sample sizes were:
Level 1- Individual level (preferred HR practices and subjective dependent variables):
N=1511
Level 2- Organizational level:
Organizational culture: each individual was assigned the mean score of his/her subsidiary
of the specific company, resulting in N of 59 (mean Rwg=.77)
Actual HR practices
Professional culture: each individual was assigned the mean score of his/her profession in
the specific subsidiary, resulting in N of 236 (mean Rwg=.78)
Organizational outcomes: N=59 subsidiaries in 19 countries
Level 3 – country level (national culture): the sample size was N=19 countries
Assessing the effect of cultural fit on the outcome variables:
The effect of the fit/misfit between the three cultures on the examined outcome (dependent)
variables was assessed by two methods:
1. Cultural distance (square gap between each couple of cultural types). Using this method
enables us to assess if big distance between cultures as opposed to small distance affect
the examined dependent variables.
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2. Method of interactions: on the basis of Chen and Mathieu (2008), we assessed fit of the
different cultures using the method of interactions. Following Chen and Mathieu (2008),
we borrow from the supplementary P-E fit logic (e.g., Cable and Edwards, 2004) to argue
that congruence among national, organizational, and professional cultures will intensify
the main effect of each other, resulting in stronger effects on the outcome variables in the
model. On the other hand, lack of congruence among the three cultures will attenuate the
results. To examine the effect of the congruence level between the three cultures, we
analyzed multiple interactions via the HLM. We also draw figures to determine the
directions of these interactions and the degree to which they support the congruence
model.
Concerning the fit between employees’ preferences of HR practices and actual HR
practices, we first assigned for each individual the actual HR practices in his/her
organization. Then, similar to the above, we squared the gap between actual and preferred
HR practices, and thus were able to compare if big distance between actual and preferred HR
practices as opposed to small distance has different effect on the examined dependent
variables.
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4.2 results- part 1
The effects of the fit/misfit among the three cultures (national, organizational, and
professional) on the examined psychological, behavioral and organizational performance
outcomes:
This part is divided into 3 sub parts:
Part 1.1: The effects of the fit/misfit among the three cultures on psychological outcomes
(satisfaction from HR practices, job satisfaction and commitment).
Part 1.2: The effects of the fit/misfit among the three cultures on organizational behavioral
outcomes (absenteeism and turnover).
Part 1.3: The effects of the fit/misfit among the three cultures on organizational
performance outcomes
Part 1.1: The effects of the fit/misfit among the three cultures on psychological
outcomes (satisfaction from HR practices, job satisfaction and commitment).
1. The effects of the three cultures on psychological outcomes
a. The effects of national culture on psychological outcomes:
The results (appears in table 11a at the appendix) indicates the following:
i.
The higher the national performance orientation, collectivism and future orientation,
and the lower the power distance, the stronger the satisfaction from HR practices.
ii.
The higher the national performance orientation, collectivism, future orientation and
uncertainty avoidance, and the lower the power distance, the stronger the job
satisfaction.
iii.
The higher the national performance orientation, collectivism and future orientation,
and the lower the power distance, the stronger the commitment.
b. The effects of organizational culture on psychological outcomes:
The results (appears in table 11b at the appendix) indicates the following:
i.
The higher the organizational performance orientation, collectivism, future
orientation and uncertainty avoidance, and the lower the power distance, the stronger
the satisfaction from HR practices.
ii.
The higher the organizational performance orientation, collectivism and uncertainty
avoidance, the stronger the job satisfaction.
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iii.
The higher the organizational performance orientation, collectivism, future
orientation and uncertainty avoidance, and the lower the power distance, the stronger
the commitment.
c. The effects of professional culture on psychological outcomes:
The results (appears in table 11c at the appendix) indicates the following:
i.
The higher the professional service focus, time orientation and risk, the stronger the
satisfaction from HR practices.
ii.
The higher the professional service focus and risk, the stronger the job satisfaction.
iii.
The higher the professional service focus, time orientation and risk, and the lower the
power distance, the stronger the commitment.
2. The differential effect of the three cultures (national, organizational and
professional) on psychological outcomes:
An interesting question is which one of the three cultures has the strongest effect.
In order to examine this issue, we created a single index for each one of the cultural type, based
on the average of the five dimensions in each culture (national culture index, organizational
culture index, professional culture index). The results appear in table 12 in the appendix.
Main conclusion: all three cultures affect psychological outcomes, but organizational
culture has the strongest effect.
3. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on psychological outcomes:
The effect of the fit between the three cultures on psychological outcomes was measured by two
methods:
1. Culture distance (square gap between each couple of cultural types). Using this method
we can assess if large distance between cultures in contrast to small distance affects
differently psychological outcomes.
2. Using the method of interactions to assess the effect of fit of different cultures. Using this
method we can assess if congruence among national, organizational, and professional
cultures intensifies the main effect of these cultures on psychological outcomes.
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1. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on psychological outcomes using culture distance method
Table 13 (see appendix) indicates the following:
i. The smaller the distance between national and organizational culture, the
stronger the satisfaction from HR practices.
ii. The smaller the distance between national and professional culture, the stronger
the satisfaction from HR practices, job satisfaction and commitment.
iii. The smaller the distance between organizational and professional culture, the
stronger the satisfaction from HR practices, job satisfaction and commitment.
Main conclusion: the smaller the distance between national and organizational culture and
national and professional culture, and the smaller the distance between organizational and
professional culture, the stronger the effect on psychological outcomes (the stronger the
satisfaction from HR, job satisfaction and commitment).
Because national and organizational cultures were measured using the same dimensions
(performance Orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the distance between each of the dimensions on
psychological outcomes (see table 14):
Main conclusion: power distance has the strongest effect: the smaller the distance between
national power distance and organizational power distance, the stronger the effect on
psychological outcomes (the stronger the satisfaction from HR, job satisfaction and
commitment).
2. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on psychological outcomes using the method of interactions (see table 15 in
the appendix)
i.
The interaction between national culture and organizational culture has positive
effect on satisfaction from HR practices, job satisfaction and commitment.
ii.
The interaction between national culture and professional culture has positive
effect on job satisfaction and commitment.
For demonstration purposes, we graphed the results. We present several examples in the
appendix (see graphs 1-4). The graphs indicated that:
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 The effect of national culture on satisfaction from HR practices is stronger when
organizational culture is high.
 The effect of national culture on job satisfaction is stronger when organizational culture
is high.
 The effect of national culture on commitment is stronger when organizational culture is
high.
 The effect of national culture on job satisfaction is stronger when professional culture is
high.
Because national and organizational cultures were measured using the same dimensions
(performance orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the interaction between each one of the
dimensions on psychological outcomes (table 16):
Main conclusion: The interaction between national and organizational performance orientations
has the strongest effect. The effects of national performance orientation on psychological
outcomes are stronger when organizational performance orientation is high.
For demonstration purposes, we graphed the results. We present several examples (see graphs 57). The graphs indicated that:
 The effect of national performance orientation on satisfaction from HR practices is
stronger in high organizational performance orientation.
 The effect of national performance orientation on job satisfaction is stronger when
organizational performance orientation is high.
 The effect of national performance orientation on commitment is stronger when
organizational performance orientation is high.
Summary of part 1.1:
1. All three types of culture (national, organizational, professional) affect psychological
outcomes.
2. Organizational culture has the strongest effect among all three cultural types on
psychological outcomes.
3. The effect of organizational culture on psychological outcomes is even stronger when it is
combined with certain national and professional cultures (for example, the interaction
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between national and organizational performance orientations produces the strongest effect
on psychological outcomes).
4. The smaller the distance between the three types of culture (national, organizational, and
professional) the stronger the satisfaction from HR, job satisfaction and commitment (power
distance dimension has the strongest effect).
Part 1.2: The effects of the fit/misfit among the three cultures on organizational outcomes
(absenteeism and turnover).
1. The effects of the three cultures on absenteeism and turnover
a. The effects of national culture on absenteeism and turnover:
The results (appears in table 17a in the appendix) indicates the following:
i.
The higher the national collectivism, uncertainty avoidance and future
orientation, and the lower the power distance, the lower the absenteeism rate.
ii.
The higher the national collectivism, uncertainty avoidance and performance
orientation, and the lower the power distance, the lower the turnover rate.
b. The effects of organizational culture on absenteeism and turnover:
The results (appears in table 17b in the appendix) indicates the following:
i.
The higher the organizational collectivism, future orientation and uncertainty
avoidance, the lower the absenteeism rate.
ii.
The higher the organizational future orientation and uncertainty avoidance, the
lower the turnover rate.
c. The effects of professional culture on absenteeism and turnover:
The results (appears in table 17c in the appendix) indicates the following:
i.
The higher the professional service focus, team focus and power distance, the
lower the absenteeism rate.
ii.
The higher the professional service focus, team focus, time orientation and
power distance and the lower the risk, the lower the turnover rate.
2. The differential effect of the three cultures (national, organizational and
professional) on absenteeism and turnover
19
The question we ask here is which one of the three cultures has the strongest effect on
absenteeism and turnover
In order to test this question we created a single index for each one of the cultural types, based on
the average of the five dimensions in each culture (national culture index, organizational culture
index, professional culture index). The results appear in table 18 in the appendix.
Main conclusion: all three cultures affect absenteeism and turnover, but organizational
culture has the strongest effect.
3. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on absenteeism and turnover
1. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on absenteeism and turnover using culture distance method
The findings (see table 19) indicate the following:
i.
The smaller the distance between national and organizational culture, the lower
the absenteeism and turnover rate.
ii.
The smaller the distance between national and professional culture, the lower
the absenteeism and turnover rate.
iii.
The smaller the distance between organizational and professional culture, the
lower the absenteeism and turnover rate.
Main conclusion: the smaller the distance between the three cultures, the lower the absenteeism
and turnover rate.
Because national and organizational cultures were measured using the same dimensions
(Performance Orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the distance between each one of the
dimensions on absenteeism and turnover (see table 20):
Main conclusion: collectivism has the strongest effect: the smaller the distance between national
collectivism and organizational collectivism, the lower the absenteeism and turnover rate.
2. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on absenteeism and turnover using the method of interactions
The results (appears in table 21) indicated:
20
i.
Interaction between national and organizational culture has negative effect on
absenteeism and turnover.
ii.
Interaction between national and professional culture has negative effect on
absenteeism and turnover.
iii.
Interaction between organizational and professional culture has negative effect
on absenteeism and turnover.
For demonstration purposes, we graphed the results. We present two examples (see graphs 8-9 in
the appendix). The results indicated:
 The effect of national culture on absenteeism is stronger when national culture is low.
 The effect of organizational culture on turnover is stronger in low professional culture.
Because national and organizational culture were measured using the same dimensions
(Performance Orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the interaction between each of the dimensions
on absenteeism and turnover (see table 22)
Main conclusion: collectivism has the strongest effect. The effects of national collectivism on
absenteeism and turnover are stronger when organizational collectivism culture is high.
For demonstration purposes, we graphed the results. We will present two examples (see graphs
10-11). The results indicated:
 The effect of national collectivism on absenteeism is stronger in low collectivistic
organizations (high individualistic organizations)
 The effect of national future orientation on turnover exists only in low future orientation
organizations.
Summary of part 1.2:
1. All three types of culture (national, organizational, professional) affect absenteeism and
turnover.
2. Organizational culture has the strongest effect among all three cultural types on
absenteeism and turnover.
3. The effect of organizational culture on absenteeism and turnover is even stronger when it
is combined with certain national and professional cultures (for example, the interaction
21
between national and organizational collectivism produces the strongest effect on
absenteeism and turnover).
4. The smaller the distance between the three types of culture (national, organizational, and
professional) the lower the absenteeism and turnover rate.
Part 1.3: The effects of the fit/misfit among the three cultures on organizational
performance outcomes
We had seven organizational performance outcome variables available, but at the company level.
Hence, our analysis regarding performance outcomes will be based first on descriptive statistics
on each of the eight companies, showing patterns of the relationships between distance among
cultures and performance outcomes. This will be followed by spearman correlations to
statistically test these relationships.
As shown in table 23 in the appendix, organization 2 has the lowest average performance
(-31.65) and the highest distance between national and organizational culture (1.21), and national
and professional culture (1.28), while organization 8 has the highest average performance
(36.02) and the lowest distance between national and organizational culture (0.14), and national
and professional culture (0.36).
To statistically examine the relationship between fit among cultures and performance
outcomes we ran spearman correlations on cultures and performance outcomes. The results
presented in table 24 in the appendix.
Main conclusion: The results indicate that the smaller the distance between national and
organizational cultures and between national and professional cultures, the stronger the
organizational performance outcomes.
Summary of part 1
1. All three types of culture (national, organizational, professional) affect psychological,
behavioral and performance outcomes.
22
2. Organizational culture has the strongest effect among all three cultural types on
psychological and behavioral outcomes while national culture has the strongest effect on
performance outcomes.
3. The effect of organizational culture on psychological and behavioral outcomes is even
stronger when it is combined with certain dimensions of national and professional culture
(the interaction between organizational and national performance orientation has the
strongest effect on psychological outcomes and the interaction between organizational
and national collectivism has the strongest effect on behavioral outcomes).
4. The effect of national culture on revenue is even stronger when it is combined with
certain dimensions of organizational and professional cultures (for example, the
interaction between national and organizational collectivism has the strongest effect on
revenue rate).
5.
The smaller the distance between the three types of culture (national, organizational, and
professional) the higher the psychological outcomes (power distance dimension has the
strongest effect), behavioral and performance outcomes.
4.3 results- part 2
The effects of the three cultures (national, organizational and professional) on employees’
HR practice preferences:
1. The effects of national culture on employees’ preferences for HR practices
The results appears in table 25 in the appendix
a. Performance appraisal – who should evaluate the employee :
The results indicate that performance orientation has a positive effect on employees’ preference
to be evaluated by their supervisor and peers evaluation (the higher the performance orientation
level, the higher the preference of employees to be evaluated by their supervisors and peers.).
Future orientation has a negative effect on employees’ preference for evaluation (the higher the
future orientation level, the lower the inclination of employees to support self-evaluation). Power
distance has a negative effect on employees’ preference for self-evaluation and a positive effect
on employees’ preference for evaluation by peers (the higher the power distance level, the higher
the preference that evaluation would be done by peers and the lower the preference that
23
evaluation would be done by the employee him/herself). Uncertainty avoidance has a negative
effect on employees’ preference for supervisory evaluation and a negative effect on preference of
self-evaluation (the higher the uncertainty avoidance level, the higher the preference of
employees for self-evaluation and the lower the preference for supervisory evaluation).
b. Performance appraisal – purpose of evaluation:
The results indicate that performance orientation has a positive effect on preferences for
feedback and promotion purposes (the higher the performance orientation level, the higher the
preference of employees that performance evaluation would be conducted for feedback and
promotion purposes). Collectivism has a positive effect on feedback and a negative effect on
development and on termination (the higher the collectivism level, the higher the preference that
evaluation would be conducted for feedback purpose and the lower the preference that evaluation
would be for development and termination purposes). Power distance has a negative effect on
development, merit, promotion and termination (the higher the power distance level, the lower
the preference that evaluation would be for development, merit, promotion and termination
purposes). Future orientation and uncertainty avoidance has no effect on preference of evaluation
purposes.
c. Flexible work arrangement:
The results indicate that performance orientation positively affects compressed working week
(the higher the performance orientation level, the higher the desire for compressed working
week). Collectivism and power distance have a negative effect on work from home and flextime,
and a positive effect on shared work (the higher the collectivism and power distance level, the
lower the desire for work from home and flextime and the higher the desire for shared work).
Uncertainty avoidance has positive effect on flextime (the higher the uncertainty avoidance level,
the lower the desire for flextime). Future orientation has no effect on preference of flexible work
arrangement.
d. Compensation:
As shown in the table, performance orientation and future orientation have a positive effect on
compensation based on individual performance, and collectivism, power distance and uncertainty
avoidance have a negative effect (the higher the performance orientation and future orientation
and the lower the collectivism, power distance and uncertainty avoidance, the higher the
preference for compensation based on individual performance).
24
In regard to compensation
based on group performance, collectivism has a positive effect on this outcome (the higher the
collectivism level, the higher the preference for compensation based on group performance).
e. Recruitment
The results show that performance orientation and collectivism have a positive effect on
preference for recruitment within the organization and uncertainty avoidance has a negative
effect on this outcome (the higher the performance orientation and collectivism level and the
lower the uncertainty avoidance, the higher the preference for recruitment within the
organization). In regard to preference of recruitment outside the organization, collectivism and
power distance have a negative effect and performance orientation has a negative effect on
preference for recruiting outside the organization (the higher the collectivism and power distance
levels, and the lower the performance orientation level, the lower the preference of recruitment
outside the organization).
f. Autonomy
As the Table shows, performance orientation has a positive effect on the autonomy level the
employees experience in the organization while uncertainty avoidance has a negative effect on
this outcome (the higher the performance orientation level and the lower the uncertainty
avoidance level, the higher the level of autonomy in the organization the employees experience).
g. Relocation
None of the national culture indices has an effect on relocation preference.
h. Termination: The use of fair criteria
The results indicate that only power distance has a negative effect on the employees’ belief that
their organization uses fair criteria to determine who will be terminated while performance
orientation and collectivism have a positive effect on this outcome (the higher the power distance
and the lower the performance orientation and collectivism, the lower the employees’ belief that
their organization uses fair criteria to determine who will be terminated).
2. The effects of organizational culture on employees’ preferences of HR practices
The results appears in table 26 in the appendix
a. Performance appraisal – who should evaluate the employee:
The results indicate that performance orientation has a positive effect on the preference that
performance evaluation will be conducted by the supervisor, subordinates and the employees
25
themselves (the higher the performance orientation level, the higher the preference that the
evaluation would be done by the supervisor, subordinates and employees). Collectivism has a
positive effect on the preference of subordinates and employees for evaluation (the higher the
collectivism level, the higher the preference that evaluation would be done by the subordinates
and employees). Power distance has a positive effect on preference for evaluation by peers (the
higher the power distance level, the higher the preference that evaluation would be done by
peers). Uncertainty avoidance has a negative effect on the preference for evaluation by the
supervisor, subordinates and employees (the higher the uncertainty avoidance level, the lower the
preference that evaluation would be done by the supervisor, subordinates and employees).
b. Performance appraisal – purpose of evaluation:
The results indicate that performance orientation has a positive effect on feedback, development
and promotion purpose (the higher the performance orientation level, the higher the preference
that evaluation would be done for feedback, development and promotion purposes). Collectivism
has a positive effect on feedback and development (the higher the collectivism level, the higher
the preference that evaluation would be done for feedback and development purposes). Power
distance has a negative effect on promotion (the higher the power distance level, the lower the
preference that evaluation would be for the purpose of promotion). Future orientation and
uncertainty avoidance have no effect on evaluation preferences.
c. Flexible work arrangement:
The results indicate that performance orientation is positively related to compressed working
week and flextime (the higher the performance orientation level, the higher the preference for
compressed working week and flextime). Collectivism has a positive effect on shared work,
compressed working week and flextime (the higher the collectivism level, the higher the
preference for shared work, compressed working week and flextime). Power distance has a
positive effect on shared work (the higher the collectivism and power distance the higher the
preference for shared work). Uncertainty avoidance has a negative effect on work from home,
shared work and flextime (the higher the uncertainty avoidance level, the lower the preference
for work from home, shared work, and flextime). Future orientation has a negative effect on
work from home, shared work and flextime (the higher the future orientation level, the lower the
preference for work from home, shared work and flextime).
d. Compensation:
26
As the Table indicates, performance orientation has a positive effect on compensation based on
individual performance. In regard to compensation based on group performance, performance
orientation and collectivism have positive effect while uncertainty avoidance has a negative
effect (the higher the performance orientation and collectivism and the lower the uncertainty
avoidance, the higher the preference for compensation based on group performance).
e. Recruitment
The results show that future orientation and collectivism have a positive effect on preference of
recruitment within the organization and power distance has a negative effect (the higher the
future orientation and collectivism and the lower the power distance, the higher the preference
for recruitment within the organization). In regard to preference of recruitment outside the
organization, performance orientation has a positive effect (the higher the performance
orientation level, the higher the preference of recruitment outside the organization).
f. Autonomy
As the Table shows, performance orientation and future orientation have a positive effect on the
autonomy level the employees experience in the organization, while power distance and
uncertainty avoidance have a negative effect on this outcome.
g. Relocation
Performance orientation and future orientation have a positive effect while uncertainty avoidance
has a negative effect on willing for relocation to different countries.
h. Termination: The use of fair criteria
The results indicate that performance orientation, collectivism and uncertainty avoidance have a
positive effect on employees’ belief that their organization uses fair criteria to determine who
will be terminated.
3. The effects of professional culture on employees preferences of HR practices
The results appears in table 27 at the appendix
a. Performance appraisal – who should evaluate the employee:
The results indicate that service focus has a positive effect on supervisor, peers, subordinates and
employees’ evaluation preferences. Team focus has a positive effect on peers’ preference for
evaluation. Risk has a positive effect on supervisor, peers and employees’ preference for
evaluation. Time orientation and power distance have no effect on preference of evaluation.
b. Performance appraisal – purpose of evaluation:
27
The results indicate that service focus has a positive effect on feedback, development, merit,
promotion and termination purposes. Team focus has a negative effect on development, merit,
promotion and termination purposes. Time orientation has a positive effect on feedback. Power
distance has a positive effect on feedback, development, and promotion purposes, and risk has a
positive effect on feedback.
c. Flexible work arrangement:
The results indicate that service focus positively affects compressed working week and flextime.
Team focus has a positive effect on shared work, and negative effect on work from home and
flextime. Power distance has a negative effect on compressed working week and flextime. Risk
has a positive effect on work from home and shared work. Future orientation has no effect on
flexible work arrangement preferences.
d. Compensation:
The Table shows that service focus has a positive effect on compensation based on individual
performance, while team focus and risk have a negative effect on this outcome. In regard to
compensation based on group performance, service focus, team focus and risk have a positive
effect on the want for compensation based on group performance.
e. Recruitment
The results show that service focus and time orientation have a positive effect on preference of
recruitment within the organization and risk has a negative effect on this outcome. In regard to
preference of recruitment outside the organization service focus has a positive effect (the higher
the service focus level, the higher the preference of recruitment outside the organization).
f. Autonomy
As the Table shows, service focus, time orientation and risk have a positive effect on the
autonomy level the employees experience in the organization, while power distance has a
negative effect on this outcome.
g. Relocation
Time focus has a positive effect, while time orientation has a negative effect on willing to
relocate to a different country.
h. Termination
28
The results indicate that service focus, team focus and time orientation have a positive effect on
the belief of the employees that their organization uses fair criteria to determine who will be
terminated.
The differential effect of the three cultures (national, organizational and professional) on
employees’ HR practice preferences:
The issue here is which one of the three cultures has the strongest effect on employees’ HR
practice preferences.
In order to examine that, we created a single index for each one of the culture types, based on the
average of the five dimensions in each culture (national culture index, organization culture index,
professional culture index).
The results appears in table 28 at the appendix
a. Performance appraisal – who should evaluate the employee:
Professional culture has the strongest effect on most evaluation preferences (except the
preference to be evaluated by peers, which national culture has the strongest effect).
Organizational culture has the second strongest effect on evaluation preferences.
b. Performance appraisal – purpose of evaluation:
National culture has the strongest effect on most evaluation purposes (except feedback, for which
professional culture has the strongest effect). Professional culture has the second strongest effect
on these evaluation purposes.
c. Flexible work arrangement:
National culture has the strongest effect on all flexible arrangement preferences. Professional
culture has the second strongest effect.
d. Compensation:
National culture has the strongest effect on the belief that compensation should be based on
individual performance, and professional culture has the strongest effect on the belief that
compensation should be based on group performance.
e. Recruitment
Organizational culture has the strongest effect on the belief that recruitment should be done from
within the organization, and national culture has the strongest effect on the thought that
recruitment should be done from outside the organization.
f. Autonomy
29
Organizational culture has the strongest effect on autonomy level the employees experience in
their organization. National culture has the second strongest effect on the outcome.
g. Relocation
Compared to the other two cultures, only national culture has an effect on the willingness for
relocation.
h. Termination
Organizational culture has the strongest effect on employees’ belief that the organization uses
fair criteria in its termination process. National culture has the second strongest effect. Final
index of prefer HR practices
i. We also create an index of all the preferred HR practices, and compared which one of
these cultures has the strongest effect.
Main conclusion: all three cultures affect preference of HR practices by the employees, but
national culture has the strongest effect, followed by professional culture..
The effects of the fit/misfit between the three cultures (national, organizational and
professional) on employees’ preferences for HR practices:
The effect of the fit between the three cultures on employees’ preferences for HR practices was
measured by two methods:
1. Culture distance (squared gap between each pair of cultural types). Using this method we
can assess if a large distance between cultures as opposed to a small distance affect
differently employees’ preferences for HR practices.
2. Fit of the different cultures using the method of interactions. Using this method we can
assess if congruence among national, organizational, and professional cultures will
intensify the main effect of employees’ preferences for HR practices.
1. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on employees’ preferences for HR practices using cultural distance method.
The results appears in table 29 at the appendix
a. Performance appraisal – who should evaluate the employee:
i.
The smaller the distance between national and organizational cultures, the
stronger the preference for supervisor and subordinates evaluation
30
ii. The smaller the distance between national and professional cultures, the
stronger the preference for supervisor and peers evaluation
iii. The higher the distance between organizational and professional cultures, the
stronger the preference for an evaluation by the supervisor, peers subordinates
and employees
b. Performance appraisal – purpose of evaluation:
i.
The smaller the distance between national and professional cultures, the
stronger the preference for evaluation for merit and promotion purposes
ii.
The higher the distance between organizational and professional cultures, the
stronger the preference for evaluation for feedback, development, merit and
promotion purposes.
c. Flexible work arrangement:
i.
The smaller the distance between national and organizational cultures, the
stronger the preference for shared work
ii.
The smaller the distance between national and professional cultures, the
stronger the preference for shared work and compressed working week
iii.
The higher the distance between organizational and professional cultures, the
stronger the preference for shared work and compressed working week
d. Compensation:
i.
The smaller the distance between national and organizational cultures, the
stronger the preference for compensation based on both individual and group
performance.
ii.
The smaller the distance between national and professional cultures, the
stronger the preference for compensation based on individual performance.
iii.
The higher the distance between organizational and professional culture, the
stronger the preference for compensation based on both individual and group
performance.
e.
Recruitment
i.
The smaller the distance between national and organizational cultures, the
stronger the preference for recruitment from within the organization
31
ii.
The smaller the distance between national and professional cultures, the
stronger the preference for recruitment from both within and outside the
organization.
iii.
The higher the distance between organizational and professional cultures the
stronger the preference for recruitment from both within and outside the
organization.
f.
Autonomy
i.
The smaller the distance between national and organizational cultures, the
stronger the autonomy level the employees feel in their organization
ii.
The smaller the distance between national and professional cultures, the
stronger the autonomy level the employees experience in their organization.
iii.
The higher the distance between organizational and professional culture the
stronger the autonomy level the employees feel in their organization
g.
Relocation
i.
The smaller the distance between national and organizational culture, the
stronger the employees’ willingness to relocate to different country
h. Termination
i.
The smaller the distance between national and organizational culture, the
higher the employees’ belief that their organization uses fair criteria to
determine who will be terminated
ii.
The smaller the distance between national and professional cultures, the higher
the employees’ belief that their organization uses fair criteria to determine who
will be terminated
iii.
The highest the distance between organizational and professional cultures, the
higher the employees’ belief that their organization uses fair criteria to
determine who will be terminated
i. Final index of preferred HR practices
i.
The smaller the distance between national and organizational cultures, the
higher the preferred HR practices index
ii.
The smaller the distance between national and professional cultures, the
stronger the preferred HR practices index
32
iii.
The higher the distance between organizational and professional cultures , the
stronger the preferred HR practices index
Main conclusion: the smaller the distance between national and organizational cultures, and
national and professional cultures, and the higher the distance between organizational and
professional cultures, the stronger the effect on preferred HR practices.
Because national and organizational cultures were measured using the same dimensions
(Performance Orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the distance between each one of the
dimensions on preferred HR practices.
The results appears in table 30 at the appendix
Main conclusion: in most cases power distance has the strongest effect. The smaller the distance
between national power distance and organizational power distance, the stronger the effect on
preferred HR practices.
2. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on employees’ preferences of HR practices using the method of interactions
The results appears in table 31 at the appendix
a. Performance appraisal – who should evaluate the employee:
i.
Interaction between national and professional culture has a positive effect on
the preference for peers evaluation
ii.
Interaction between organizational and professional culture has a positive
effect on the preference for supervisory evaluation
b. Performance appraisal – purpose of evaluation:
i.
Interaction between national and professional culture has a positive effect on
the preference of evaluation for merit and promotion purposes
ii.
Interaction between national and professional culture has a positive effect on
the preference of evaluation for feedback, development, merit and promotion
purposes.
iii.
Interaction between organizational and professional culture has a negative
effect on the preference of evaluation for the merit purpose.
c. Flexible work arrangement:
33
i.
Interaction between national and organizational culture has a positive effect on
the preference for shared work and compressed working week
ii.
Interaction between national and professional culture has a positive effect on
the preference for work from home, shared work and compressed working
week
iii.
Interaction between organizational and professional culture has a negative
effect on the preference for work from home, shared work, compressed
working week and flextime
d. Compensation:
i.
Interaction between national and organizational culture has a positive effect on
the preference for compensation based on individual performance.
ii.
Interaction between national and professional culture has a positive effect on
the preference for compensation based both on individual and group
performance.
iii.
Interaction between organizational and professional culture has positive effect
on the preference for compensation based on group performance.
e. Recruitment
i.
Interaction between national and organizational culture has a positive effect on
the preference for recruitment from outside the organization.
ii.
Interaction between national and professional culture has a positive effect on
the preference for recruitment from outside the organization.
f. Autonomy
i.
Interaction between national and organizational culture has a positive effect on
the autonomy level the employees feel in their organization.
g. Relocation
i.
No interaction found
h. Termination
i.
Interaction between national and organizational culture has a positive effect on
employees’ perception of their organization as using fair criteria to determine
who will be terminated.
i. Final index of prefer HR practices
34
i.
Interaction between national and professional culture has a positive effect on
the preferred HR practices index
For demonstration purposes, we graphed the results. We will present several examples (see
graphs 12- 17 at the appendix). The graphs indicated the following:
 The effect of national culture on preference to be evaluated by peers is stronger when
professional culture is high.
 The effect of national culture on preference of compressed working week is stronger
when organizational culture is high.
 The effect of national culture on preference of recruitment from outside the organization
is stronger when professional culture is high.
 The effect of national culture on employees’ perceived autonomy level is stronger when
organizational culture is high.
 The effect of national culture on employees’ belief that the organization uses fair
criteria for termination is stronger when professional culture is high.

The effect of national culture on preferred HR practices’ index is stronger when
professional culture is high.
Main conclusion: the effect of national culture on preferred HR practices is stronger in the
presence of certain dimensions of organizational and professional cultures.
Because national and organizational cultures were measured using the same dimensions
(Performance Orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the interaction between each one of the
dimensions on preferred HR practices.
The results appears in table 32 at the appendix
Main conclusion: in most cases performance orientation has the strongest effect. Moreover, the
effect of national performance orientation on preferred HR practices is stronger when
organizational performance orientation culture is high.
For demonstration purposes, we graphed the results. We will present an example- see graph 18.
35
Summary of part 2:
1. All three types of culture (national, organizational, professional) affect HR practices
preferred by the employees.
2. National culture has the strongest effect among all three cultural types.
3. The effect of national culture on HR practices preferred by the employees is even stronger
under certain dimensions of organizational and professional cultures (for example, the
interaction between national and organizational performance orientation has the strongest
effect).
4. The smaller the distance between national culture and organizational culture, the stronger the
effect on HR practices preferred by the employees (power distance dimension has the
strongest effect).
4.4 results- part 3
The effects of the three cultures (national, organizational and professional) on actual HR
practice preferences:
1. The effects of national culture on actual HR practice preferences
The results appears in table 33 at the appendix
a. Performance appraisal – who perform the evaluation:
The results indicate that performance orientation and future orientation have a positive effect on
all aspects of evaluation (the higher the performance orientation level, the higher the
involvement of supervisors, peers, subordinates and employees in performance appraisal). Power
distance has a negative effect on peers’ and subordinates’ evaluation (the higher the power
distance level, the lower the use of peers and subordinates in conducting evaluation). Uncertainty
avoidance has a negative effect on all aspects of evaluation (the higher the uncertainty avoidance
level, the lower the use of supervisors, peers, subordinates and employees in conducting
performance evaluation)
b. Performance appraisal – purpose of evaluation:
The results indicate that performance orientation has positive effect on feedback and promotion
purposes, and a negative effect on merit (the higher the performance orientation level, the higher
the evaluation is for feedback and promotion purposes and the lower the evaluation for a merit
purpose). Collectivism has a negative effect on development and merit, and a positive effect on
36
termination (the higher the collectivism level, the lower the use of evaluation for feedback and
promotion purposes, and the higher the evaluation for a termination purpose). Power distance has
a negative effect on feedback, development, merit and promotion and a positive effect on
termination (the higher the power distance level, the lower the evaluation is for feedback,
development, merits and promotion and the higher the higher the evaluation is for termination).
Future orientation has positive effect on feedback, development and merit (the higher the future
orientation level, the higher the evaluation is for feedback, development and merit). Uncertainty
avoidance has a negative effect on merit, promotion and termination (the higher the uncertainty
avoidance level, the lower the evaluation is for merit, promotion and termination purposes).
c. Flexible work arrangement- the organization offers the following:
The results indicate that performance orientation positively affects shared work and compressed
working week (the higher the performance orientation level, the higher the likelihood that the
organization will offer shared work and compressed working week). Collectivism has negative
effect on work from home, shared work, flextime and compressed working week (the higher the
collectivism level, the lower is the likelihood of the organization to offer work from home,
shared work, flextime and compressed working week). Power distance has a negative effect on
all aspects of flexible work arrangements (the higher the power distance level, the lower is the
likelihood of the organization to offer flexible work arrangements). Uncertainty avoidance has a
negative effect on flextime (the higher the uncertainty avoidance level, the lower the preference
for flextime). Future orientation has a positive effect on work from home (the higher the future
orientation level the higher the likelihood the organization will offer work from home).
d. Compensation- the organization offer compensation based on:
As the Table shows, performance orientation, collectivism, future orientation and power distance
have a negative effect on compensation based on individual performance (the higher the
performance orientation, collectivism, future orientation and power distance, the lower is the
individual performance based compensation). In regard to compensation based on group
performance, performance orientation, collectivism, future orientation and uncertainty avoidance
have a positive effect (the higher the performance orientation, collectivism, future orientation
and uncertainty avoidance, the higher is the group performance based compensation).
e. Recruitment
37
The results show that performance orientation, power distance and uncertainty avoidance have a
negative effect on recruitment from within the organization (the higher the performance
orientation, power distance and uncertainty avoidance, the lower the recruitment from within the
organization). In regard to recruitment outside the organization, collectivism has a negative
effect, and performance orientation and power distance have a positive effect (the higher the
collectivism level, and the lower the performance orientation and power distance levels, the
lower the recruitment from outside the organization).
f. Autonomy
As shown from the table, performance orientation and future orientation have a positive effect on
the autonomy level offered by the organization, while collectivism and power distance have a
negative effect on this outcome (the higher the performance orientation and future orientation
and the lower the collectivism and power distance, the higher the autonomy level offered by the
organization).
g. Relocation
Future orientation has a positive effect while collectivism and uncertainty avoidance have a
negative effect on the mobility opportunities offered by the organization.
h. Termination- use of fair criteria
The results indicate that collectivism, power distance and uncertainty avoidance have a negative
effect on the organization use of fair criteria to determine who will be terminated while
performance orientation and future orientation have a positive effect (the higher the collectivism,
power distance and uncertainty avoidance and the lower the performance orientation and future
orientation, the lower the organization use of fair criteria to determine who will be terminated).
i. Layoffs process- the use of the following layoffs criteria:
Performance ordination and future orientation have a positive effect on performance appraisal
criteria used to determine layoffs, and negative effect on seniority and income. Collectivism has
positive effect on performance appraisal and income. Power distance has negative effect on
employee income, and uncertainty avoidance has a negative effect on seniority and income
criteria of layoffs.
2. The effects of organizational culture on actual HR practices
The results appears in table 34 in the appendix
a. Performance appraisal – who performs the evaluation:
38
The results indicate that collectivism has a negative effect on peers’ evaluation (the higher the
collectivism level, the lower the evaluation based on peers). Future orientation has a positive
effect on supervisor and peers’ evaluation (the higher the future orientation level, the higher the
use of supervisor and peers for evaluation). Power distance has negative effect on supervisor
evaluation (the higher the power distance level, the lower the supervisory-based evaluation).
Uncertainty avoidance has a positive effect on evaluation conducted by supervisor, peers and
subordinates (the higher the uncertainty avoidance level the higher the conduct of evaluation by
the supervisor, peers and subordinates).
b. Performance appraisal – purpose of evaluation:
The results indicate that performance orientation has a positive effect on feedback and
termination purposes (the higher the performance orientation level, the higher the use of the
evaluation for feedback and termination purposes). Collectivism has a negative effect on merit
and termination (the higher the collectivism level, the lower the use of evaluation for merit and
termination purposes). Power distance has a positive effect on merit and termination (the higher
the power distance level, the higher the use of evaluation for merit and termination purposes).
Future orientation has a positive effect on feedback, development and termination, and a
negative effect on merit (the higher the future orientation level, the higher the use of evaluation
for feedback, development and termination and the lower the use of evaluation for merit).
Uncertainty avoidance has no effect on criteria of evaluation purposes.
c. Flexible work arrangements:
The results indicate that performance orientation positively affects all aspects of flextime (the
higher the performance orientation level, the higher the flextime work arrangement offered by
the organization). Collectivism has a negative effect on all aspects of flextime (the higher the
collectivism level, the lower the flextime work arrangement offered by the organization). Future
orientation has a positive effect on shared work and flextime. Uncertainty avoidance has a
negative effect on work from home and shared work. Power distance has no effect on flextime
work arrangement offered by the organization
d. Compensation:
As the Table shows, performance orientation has a positive effect on compensation based on
group performance. In regard to compensation based on individual performance, future
orientation has a negative effect while uncertainty avoidance has a positive effect on this
39
outcome (the higher the future orientation level and the lower the uncertainty avoidance, the
lower the individual performance based compensation).
e. Recruitment
The results show that only performance orientation has an effect on recruitment (the higher the
performance orientation level, the lower the use of recruitment within the organization).
f. Autonomy
As the Table shows table future orientation has a positive effect on the autonomy level offered
by the organization, while collectivism and power distance have a negative effect (the higher the
performance orientation and future orientation, and the lower the collectivism and power
distance, the higher the autonomy level offered by the organization).
g. Relocation
Future orientation has a positive effect, while collectivism has a negative effect on relocation
opportunities offered by the organization.
h. Termination- the use of fair criteria
The results indicate that collectivism, power distance and uncertainty avoidance have a negative
effect on the organization use of fair criteria to determine who will be terminated, while
performance orientation and future orientation have a positive effect (the higher the collectivism,
power distance and uncertainty avoidance and the lower the performance orientation and future
orientation, the lower the organization use of fair criteria to determine who will be terminated).
i. Layoffs process- the use of the following layoffs criteria:
Performance orientation and future orientation have a positive effect on income. Power distance
has a positive effect on seniority criteria for layoffs..
3. The effects of professional culture on actual HR practices
The results appears in table 35 at the appendix
a. Performance appraisal – who performs the evaluation:
The results indicate that service focus has a positive effect on subordinates and employees’
evaluation. Team focus has a positive effect on supervisory evaluation and a negative effect on
evaluation conducted by subordinates and employees. Time orientation has a positive effect on
preference for evaluation by subordinates and employees. Power distance has a positive effect on
peers’ evaluation and a negative effect on employees’ evaluation. Risk has no effect on
preference of evaluation.
40
b. Performance appraisal – purposes of evaluation:
The results indicate that service focus has positive effect on development, merit, promotion and
termination purposes. Team focus has a negative effect on the purpose of development. Time
orientation has a positive effect on all aspects of evaluation purposes. Power distance has a
negative effect on the purpose of merit, and risk has a negative effect on the purpose of
development and a positive effect on the purpose of termination.
c. Flexible work arrangements:
The results indicate that service focus positively affect all flextime aspects. Team focus has a
negative effect on all flextime aspects. Power distance has a negative effect on shared work,
compressed working week and flextime. Risk has a positive effect on work from home and
compressed working week. Time orientation has no effect on flexible work arrangements.
d. Compensation:
As the table shows, compensation based on individual performance is negatively affected by
team focus. In regard to compensation based on group performance, team focus and risk have a
positive effect on this outcome.
e. Recruitment
The results show that service focus power distance has a positive effect on recruitment within the
organization and team focus has a negative effect on this outcome. In regard to recruitment
outside the organization, power distance and risk have a negative effect on this outcome.
f. Autonomy
As the table shows, service focus, has a positive effect on the autonomy for decision making
while power distance has a negative effect on this outcome.
g. Relocation
Service focus has a positive effect on relocation to different countries.
h. Termination- use of fair criteria
The results indicate that team focus and risk have a negative effect on the organization use of fair
criteria to determine who will be terminated, while service focus and time orientation have a
positive effect on this outcome.
i. Layoff process- the use of the following layoff criteria:
Time orientation has a positive effect on seniority while team focus, power distance and risk
have a negative effect on seniority. Service focus and time orientation have a positive effect on
41
performance appraisal, and team focus and power distance have a negative effect. Team focus,
time orientation and power distance have a positive effect on seniority criteria of layoff process
while risk has a negative effect on this outcome.
The differential effect of the three cultures (national, organizational and professional) on
employees’ HR practice preferences:
The question here is which one of the three cultures has the strongest effect.
In order to examine that, we created a single index for each one of the cultural types, based on
the average of the five dimensions in each culture (national culture index, organizational culture
index, professional culture index).
The results appears in table 35 in the appendix
a. Performance appraisal – who performs the evaluation:
National culture has the strongest effect on most aspects of the evaluation sources, followed by
organizational culture.
b. Performance appraisal – purpose of evaluation:
National culture has the strongest effect on development, merit and promotion. Professional
culture has the strongest effect on feedback. Organizational culture has the strongest effect on
termination.
c. Flexible work arrangement:
National culture has the strongest effect on flextime. Organizational culture has the strongest
effect on shared work and compressed working week, professional culture has the strongest
effect on work from home.
d. Compensation:
Organizational culture has the strongest effect on individual performance, group performance,
and compensation.
e. Recruitment
National culture has the strongest effect on recruitment from within the organization, and
national and organizational culture have the same effect on recruitment from outside the
organization.
42
f. Autonomy
Organizational culture has the strongest effect on autonomy level at work while professional
culture has the strongest effect on autonomy for decision making.
g. Relocation
National culture has the strongest effect, followed by professional culture.
h. Termination- use of fair criteria
None of the cultural types has a significant effect.
i. Layoff process- the use of the following layoff criteria:
On most cases (besides seniority), organizational culture has the strongest effect on layoff
criteria.
j. Final index of preferred HR practices
Main conclusion: organizational culture has the strongest effect on actual HR practices
implemented in the organization
The effects of the fit/misfit between the three cultures (national, organizational and
professional) on actual HR practices:
The effect of the fit between the three cultures and actual HR practices was assessed by two
methods:
1. Culture distance (squared gap between each couple of cultural types). Using this method
we can assess if a large distance between cultures as opposed to small distance affects
differently actual HR practices.
2. Using the method of interactions. Based on this method we can assess if congruence
among national, organizational, and professional cultures will intensify the main effect on
actual HR practices.
1. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on actual HR practices using cultural distance method (table 37)
a.
Performance appraisal – who performs the evaluation:
i.
The smaller the distance between national and organizational culture, the lower
the use of employees’ evaluation
43
ii. The smaller the distance between national and professional culture, the higher
the use of evaluation by the supervisor, subordinates and peers.
iii. The higher the distance between organizational and professional cultures, the
higher the use of subordinates’ evaluation
b.
Performance appraisal – purpose of evaluation:
i.
The smaller the distance between national and organizational culture, the
higher the use of evaluation for feedback and merit, and the lower the use of
evaluation for development and termination purposes.
ii.
The smaller the distance between national and professional culture, the lower
the use of evaluation for feedback and the higher the use of evaluation for
termination.
iii.
The higher the distance between organizational and professional cultures, the
higher the use of evaluation for development, promotion and termination
purposes.
c.
Flexible work arrangements:
i.
The smaller the distance between national and organizational cultures, the
higher the use of work from home and compressed working week, and the
lower the use of flextime.
ii.
The smaller the distance between national and professional cultures, the higher
the use of all aspects of flextime work arrangements.
iii.
The higher the distance between organizational and professional cultures, the
higher the use of work from home, shared work and compressed working
week
d.
Compensation:
i.
The smaller the distance between national and organizational cultures, the
higher the use of individual performance based compensation and the lower the
use of group performance.
ii.
The higher the distance between organizational and professional cultures, the
higher the use of individual performance based compensation and the lower the
use of group performance.
44
e.
Recruitment
i.
The smaller the distance between national and organizational cultures, the
higher the use of recruitment from within the organization
ii.
The smaller the distance between national and professional culture, the higher
the use of recruitment from within and the lower the use of recruitment from
outside the organization.
iii.
The higher the distance between organizational and professional cultures the
higher the use of recruitment from both within and outside the organization.
f.
Autonomy
i.
The smaller the distance between national and professional cultures, the higher
the autonomy level offered by the organization.
g.
Relocation
i.
The larger the distance between national and professional cultures, the higher
the options to relocate to different country.
h.
Termination
i.
The smaller the distance between national and organizational cultures, the
higher the organization use of fair criteria to determine who will be terminated
i.
Layoff process- the use of the following layoff criteria:
i.
The smaller the distance between national and organizational cultures, the
higher the use of seniority as a criterion for layoffs.
ii.
The smaller the distance between national and professional cultures, the higher
the use of seniority, performance appraisal and employees’ income as layoff
criteria
iii.
The higher the distance between organizational and professional cultures the
higher the use of performance appraisal and employees’ income as layoff
criteria.
j.
Final index of actual HR practices
i.
The smaller the distance between national and organizational cultures, the
higher use of specific HR practices.
ii.
The higher the distance between organizational and professional cultures, the
higher the use of specific HR practices.
45
Main conclusion: distance between three aspects of culture (national, organizational and
professional) affects the use of actual HR practices.
Because national and organizational cultures were measured using the same dimensions
(Performance Orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the distance between each one of the
dimensions on preferred HR practices.
The results appears in table 38 in the appendix
Main conclusion: all the dimensions of culture affect implementation of actual HR practices in
the organization.
2. The effects of the fit/misfit between the three cultures (national, organizational and
professional) on employees’ HR practice preferences using the method of interactions
The results appears in table 39 in the appendix
a. Performance appraisal – who evaluates the employee:
i.
Interaction between national and organizational culture has a negative effect on
evaluations conducted by supervisors, peers and subordinates.
ii. Interaction between national and professional culture has a negative effect on
peers’ and subordinates’ evaluation and a positive effect on employees’
evaluation.
iii. Interaction between organizational and professional culture has a positive
effect on supervisors, peers and subordinates evaluation and a negative effect
on employees’ evaluation.
b. Performance appraisal – purpose of evaluation:
i.
Interaction between national and organizational culture has a negative effect on
evaluation for feedback, development, promotion and termination purposes
ii.
Interaction between national and professional culture has a negative effect on
the evaluation for development, merit, promotion and termination purposes
iii.
Interaction between national and professional culture has a positive effect on
all evaluation criteria.
c. Flexible work arrangement:
46
i.
Interaction between national and organizational culture has a positive effect on
shared work, compressed working week and flextime.
ii.
Interaction between national and professional culture has a positive effect on
flextime.
iii.
Interaction between organizational and professional culture has a negative
effect on flextime and a positive effect on work from home.
d. Compensation:
i.
Interaction between national and organizational culture has a negative effect on
compensation based on group performance.
ii.
Interaction between national and professional culture has a negative effect on
compensation based on group performance.
iii.
Interaction between organizational and professional culture has a positive
effect on compensation based on group performance.
e. Recruitment
i.
Interaction between national and organizational culture has a positive effect on
recruitment from outside the organization and a negative effect on recruitment
from inside the organization.
ii.
Interaction between national and professional culture has a negative effect on
recruitment from inside the organization.
iii.
Interaction between organizational and professional culture has a positive
effect on recruitment from inside the organization and a negative effect on
recruitment from outside the organization.
f. Autonomy
i.
Interaction between national and organizational culture has a positive effect on
autonomy level at work and a negative effect on autonomy in decision making.
ii.
Interaction between national and professional culture has a positive effect on
autonomy level at work.
iii.
Interaction between organizational and professional culture has a negative
effect on autonomy level at work and a positive effect on autonomy in decision
making.
g. Relocation
47
i.
Interaction between national and organizational culture has a negative effect on
relocation.
ii.
Interaction between national and professional culture has a negative effect on
relocation.
iii.
Interaction between organizational and professional culture has a positive
effect on relocation.
h. Termination
i.
Interaction between national and organizational culture has a positive effect on
using fair criteria to determine who will be terminated
i.
Layoffs process- the use of the following layoff criteria:
i.
Interaction between national and organizational culture has a positive effect on
seniority and performance appraisal, and a negative effect on income criteria for
layoff.
ii.
Interaction between national and professional culture has a positive effect on
seniority and performance appraisal, and a negative effect on income criteria for
layoff.
iii.
Interaction between organizational and professional culture has a negative effect
on seniority and performance appraisal, and a positive effect on income criteria
for layoff.
J.
Final index of preferred HR practices
i.
Interaction between national and organizational culture has a negative effect on
actual HR practices index
ii.
Interaction between national and professional culture has a negative effect on
the actual HR practices index
iii.
Interaction between organizational and professional culture has a positive
effect on actual HR practices index
For demonstration purposes, we graphed the results. We will present several examples (see
graphs 19- 24). The graphs indicated:

The effect of national culture on supervisory evaluation is stronger when organizational
culture is high.
48

The effect of organizational culture on work from home exists only when professional
culture is high.

The effect of organizational culture on recruitment from inside the organization is
stronger when professional culture is high.

The effect of national culture on group performance based compensation is stronger
when organizational culture is low.

The effect of national culture on autonomy level at work is in different directions in
high vs. low professional culture, and it is stronger when professional culture is low.

The effect of organizational culture on relocation exists only when professional
culture is high.
Main conclusion: the effect of organizational culture on actual HR practices is stronger in the
presence of certain dimensions of national and professional cultures.
Because national and organizational cultures were measured using the same dimensions
(Performance Orientation, collectivism, uncertainty avoidance, future orientation and power
distance), we were able to examine the effects of the interactions between the different
dimensions on preferred HR practices.
The results appears in table 40 in the appendix
Main conclusion: in most cases future orientation has the strongest effect. Moreover, the effect of
organizational future orientation on actual HR practices is stronger when national future
orientation culture is high.
For demonstration purposes, we graphed the results. We will present an example (graph 25). The
results indicated that:

The effect of national future orientation on layoff due to seniority exists only when
organizational future orientation is high.
Summary of part 3:
1. In most HR practices, both organizational culture and national culture have an effect.
2. The most important factor (among the three cultures) affecting actual HR practices
implemented in the organization is organizational culture.
49
3. The effect of organizational culture on actual HR practices is stronger in the presence of
certain dimensions of national and professional cultures (future orientation dimension has the
strongest effect).
4. Distance between all three aspects of culture (national, organizational and professional)
affects the implementation of HR practices in organization (all five dimensions have an
effect).
4.5 results- part 4
The effects of the fit/misfit among preferred HR practices and actual HR practices on
the examined psychological outcomes (job satisfaction, organizational commitment and
satisfaction from HR practices)
The results appears in table 41 in the appendix
a. Fit/misfit between preferred performance appraisal (who should evaluate the employee)
and actual performance appraisal (who evaluate the employee)
 The smaller the gap between preferred supervisor evaluation and actual supervisor
evaluation, the higher the satisfaction from HR practices, job satisfaction and
commitment.
 The smaller the gap between preferred peers’ evaluation and actual peers’ evaluation,
the higher the satisfaction from HR practices, job satisfaction and commitment.
 The smaller the gap between preferred subordinates’ evaluation and actual
subordinates’ evaluation, the higher the level of job satisfaction and commencement.
 The smaller the gap between preferred employees’ evaluation and actual employees’
evaluation, the higher level of commitment.
b. Fit/misfit between preferred performance appraisal (what should be the purpose of
evaluation) and actual performance appraisal (actual purpose of evaluation)
 The smaller the gap between preferred feedback purpose of evaluation and actual
feedback purpose of evaluation, the higher the satisfaction from HR practices, job
satisfaction and commitment.
50
 The smaller the gap between preferred developmental purpose of evaluation and actual
developmental purpose of evaluation, the higher the job satisfaction and commitment.
 The smaller the gap between preferred promotion purpose of evaluation and actual
promotion purpose of evaluation, the higher the job satisfaction and commitment.
 The smaller the gap between preferred termination purpose of evaluation and actual
termination purpose of evaluation, the higher the satisfaction from HR practices and
job satisfaction.
c. Fit/misfit between preferred flexible work arrangement and actual flexible work
arrangement
 The smaller the gap between preferred work from home arrangement and actual work
from home arrangement, the higher the satisfaction from HR practices, job satisfaction
and commitment.
 The smaller the gap between preferred shared work arrangement and actual shared
work arrangement, the higher the satisfaction from HR practices, job satisfaction and
commitment.
 The smaller the gap between preferred flextime arrangement and actual flextime
arrangement, the higher the satisfaction from HR practices, job satisfaction and
commitment.
d. Fit/misfit between preferred compensation and actual compensation
 The smaller the gap between preferred compensation based on individual performance
and actual compensation based on individual performance, the higher the satisfaction
from HR practices, job satisfaction and commitment.
e. Fit/misfit between preferred recruitment and actual recruitment
 The smaller the gap between preferred recruitment from within the organization and
actual recruitment from within the organization, the higher the satisfaction from HR
practices, job satisfaction and commitment.
 The smaller the gap between preferred recruitment from outside the organization and
actual recruitment from outside the organization, the higher the job satisfaction.
f. Fit/misfit between preferred autonomy level in decision making and actual autonomy in
decision making
51
 The smaller the gap between preferred autonomy level in decision making and actual
autonomy level in decision making, the higher the satisfaction from HR practices, job
satisfaction and commitment.
g. Fit/misfit between preferred relocation and actual relocation
 The smaller the gap between preferred relocation opportunities and actual relocation
opportunities, the higher the satisfaction from HR practices and commitment.
h. Fit/misfit between the employees’ opinion about the fairness level regarding termination
in their organization and actual fairness level regarding termination
 The smaller the gap between employees’ belief about the fairness level regarding
termination and actual fairness level regarding termination, the higher the satisfaction
from HR practices, job satisfaction and commitment.
i. Fit/misfit between preferred general HR index and actual general HR index
 The smaller the gap between preferred general HR index and actual general HR index,
the higher the satisfaction from HR practices, job satisfaction and commitment.
Summary of part 4:
Fit between employees’ preference of HR practices and actual HR practices in the organization
(regarding performance appraisal, flexible work arrangements, compensation, recruitment,
autonomy level, relocation and termination) enhances satisfaction from HR, job satisfaction and
commitment level of the employees.
4.6 results- part 5
The effects of the fit/misfit among preferred HR practices and actual HR practices on
organizational behavioral and performance indicators of absenteeism, turnover, and
financial growth outcomes
This part divided into 2 sub parts:
Part 5.1: The effects of the fit/misfit among preferred HR practices and actual HR
practices on organizational outcomes (absenteeism and turnover).
Part 5.2: The effects of the fit/misfit among preferred HR practices and actual HR
practices on organizational performance outcomes
52
Part 5.1: The effects of the fit/misfit among preferred HR practices and actual HR
practices on organizational outcomes (absenteeism and turnover):
The results appears in table 41 in the appendix
a. Fit/misfit between preferred performance appraisal (who should evaluate the employee)
and actual performance appraisal (who evaluate the employee)
 The smaller the gap between preferred supervisor evaluation and actual supervisor
evaluation, and between preferred subordinates evaluation and actual subordinate’s
evaluation, the lower the absenteeism rate.
 The smaller the gap between preferred supervisor evaluation and actual supervisor
evaluation, and preferred employees’ evaluation and actual employees’ evaluation, the
lower the turnover rate.
b. Fit/misfit between preferred performance appraisal (what should be the purpose of
evaluation) and actual performance appraisal (actual purpose of evaluation)
 The smaller the gap between preferred evaluation for the purposes of feedback,
development, merit and termination, and actual evaluation for the purposes of
feedback, development, merit and termination, the lower the absenteeism and turnover
rate.
c. Fit/misfit between preferred flexible work arrangements and actual flexible work
arrangements
 The smaller the gap between preferred work from home, compressed working week
and flextime work arrangements and actual work from home, compressed working
week and flextime work arrangements, the lower the absenteeism and turnover rates.
d. Fit/misfit between preferred compensation and actual compensation
 The smaller the gap between preferred compensation based on individual performance
and actual compensation based on individual performance, the lower the absenteeism
and turnover rates.
e. Fit/misfit between preferred recruitment and actual recruitment
 The smaller the gap between preferred recruitment within the organization and actual
recruitment within the organization, the lower the absenteeism and turnover rates.
53
f. Fit/misfit between preferred autonomy level in decision making and actual autonomy in
decision making
 The smaller the gap between preferred autonomy level in decision making and actual
autonomy level in decision making, the lower the turnover rate.
g. Fit/misfit between preferred relocation and actual relocation
 The smaller the gap between preferred relocation opportunities and actual relocation
opportunities, the lower the turnover rate.
h. Fit/misfit between the employees’ opinion about the fairness level regarding termination
in their organization and actual fairness level regarding termination
 No relationship found.
i. Fit/misfit between preferred general HR index and actual general HR index
 The smaller the gap between preferred general HR index and actual general HR index,
the lower the absenteeism and turnover rates.
Summary of part 5.1:
Fit between employees’ preference of HR practices and actual HR practices in the organization
(regarding performance appraisal, flexible work arrangement, compensation, recruitment,
autonomy level and relocation) reduce absenteeism and turnover rates.
Part 5.2: The effects of the fit/misfit among preferred HR practices and actual HR
practices on organizational performance outcomes
As mentioned in section 4.2 (results- part 1), we had seven organizational performance outcomes
(variables) available, but at the company level. Hence, our analysis regarding performance
outcomes will be based on descriptive statistics for each of the eight companies, as well as the
analysis of spearman correlations, to look for patterns that can help us determine if there is a
relationship between the distance of preferred and actual HR practices and performance
outcomes.
As shown in table 43, organization 2 has the lowest average performance (-31.62) and the
highest average distance between preferred and actual HR practices (1.15), while organization 8
has the highest average performance (36.02) and the lowest average distance between preferred
and actual HR practices (0.41).
54
To examine the relationship between fit among preferred HR practices and actual HR
practices and performance outcomes we ran spearman correlations on cultures and performance
outcomes. The results presented in table 44 in the appendix.
Main conclusion: The smaller the distance between preferred and actual HR practices, the
higher the organization’ performance.
Summary of part 5:
Fit between employees’ HR practice preferences and actual HR practices in the organization
(regarding performance appraisal, flexible work arrangements, compensation, recruitment,
autonomy level and relocation) reduces absenteeism and turnover rates and enhances
organizational performance indicators.
4.7 results- part 6
Summary of the qualitative interviews
During our research we conducted systematic personal interviews with 11 HR managers of
multi-national organizations.
The main issues that were brought up in the interviews were:
a. The managers’ approach as to the importance of the cultural variety (organizational
culture, national and professional cultures) in establishing HR practices.
b. Potential matches and mismatches between the three types of cultures.
c. Potential practical implications of the research results for future planning in HR
management.
The main conclusions:
a. Organizational and national cultures are of high interest and HR managers find them as a
major concern in both strategic and tactical levels, when dealing with HR practices.
Their concerns relate to the level at which the global corporate guidelines and procedures
are adequate to the national culture in various countries. The main concerns relate to
practices of new employees hiring, appraisal methodologies, and mobility between
countries. One of the companies, as an example, in which its headquarter is located in
55
Israel brings every new employee (worldwide) for an orientation process in Israel. On
the other hand, there are those who take the opposite direction and run specific
orientation processes in each country. The range of solutions is wide and we have not
found a single valid effectiveness evaluation process in the companies. The policy is
usually dictated by the company’s experiences (trial and error) and mainly by the
personal managerial beliefs of the CEO and the HR manager at the corporate level.
HR managers have put less emphasis on the professional culture, to which they turn only
when building up multi-national virtual teams or international knowledge communities.
They are unaware of the possible impacts of gaps between the professional culture and
the national or organizational ones.
b. The fit/misfit between cultures has become a dominant factor in the HR decision making
practices of global organizations. As one of the HR managers we interviewed for this
study stated: "The continued constant dialog between the 'organizational DNA'
(organizational culture) and the need to accommodate for the national culture is a central
issue on my mind". The global multinational companies in the study differ in their HR
strategy: some have centralized and standardized their HR policies across the different
cultures, while others have relied on a decentralized approach by implementing
differential HR practices in the different countries. To illustrate: In our interview, an HR
director in one of the more centralized corporations stated that “The organization needs to
produce its own “glue” by carefully maintaining the host organizational culture in all
countries.”
In contrast, another HR director we interviewed stated that “From my
experience I learned that it is impossible to implement HR practices that contradict the
national culture”. This difference in strategy has implications for specific HR practices,
such as the mobility between countries or layoff practices. While some HR managers
encourage relocation, others prevent it. Similarly, while some international organizations
rely on standardized layoff practices regardless of culture, other international
organizations modify their layoff practices according to the national culture of the
particular organizational unit.
c. All the HR managers we interviewed want the research results to enable them understand
what contributes to the success of different HR practices in their multiple international
organizations, and More specifically:
56

They expressed their need for knowledge on how to manage the complex
effect of the three cultures (national, Organizational, and professional) on a
variety of HR practices, and the effects of these practices on multiple work
outcomes.

Since it is extremely important for HR managers to "listen" to the employees
on the one hand and understand the consequences of their practices on the
business on the other hand, the outcomes of the research, so they hope, will
help them make decisions like centralization or decentralization of HR
practices in the different countries in an improved way.

Our answers to the research questions address the main concerns raised by the
HR professionals we have met and can indeed enable corporations to
recognize the important role of cultural diversity in designing effective HR
strategies. The systematic analyses we have conducted as predictors of
outcome criteria, provide managers a set of rich and comprehensive findings.
Such information should enable managers who are responsible for global
operations to more effectively determine what HR programs to establish in
organizations that are based or operate in different cultures, and which
characteristics these programs should have to maximize their contribution to
organizational competitiveness.
57
4.8 results- summary
1. How is the fit/misfit among the three cultures (national, organizational, and
professional) related to the examined psychological, behavioral and organizational
performance outcomes?
a. All three types of culture (national, organizational, professional) affect psychological,
behavioral and performance outcomes.
b. Organizational culture has the strongest effect among all three cultural types on
psychological and behavioral outcomes while national culture has the strongest effect
on performance outcomes.
c. The effect of organizational culture on psychological and behavioral outcomes is
even stronger under certain dimensions of national and professional cultures (the
interaction between organizational and national performance orientation has the
strongest effect on psychological outcomes, while the interaction between
organizational and national collectivism has the strongest effect on behavioral
outcomes).
d. The smaller the distance between the three types of culture (national, organizational,
and professional) the higher the psychological outcomes (power distance dimension
has the strongest effect), and the higher the behavioral and performance outcomes
(collectivism dimension has the strongest effect).
2. How are national, organizational, and professional cultures related to employees’
preferences for different human resource practices?
a. All three types of culture (national, organizational, professional) affect HR practices
preferred by the employees.
b. National culture has the strongest effect among all three cultural types.
c. The effect of national culture on HR practices preferred by the employees is stronger
under certain dimensions of organizational and professional cultures (performance
orientation dimension has the strongest effect).
d. The smaller the distance between national culture and organizational culture, the
higher the preference for HR practices by employees (power distance dimension has
the strongest effect).
58
3. How are national, organizational, and professional cultures related to the actual
characteristics of human resource practices implemented by organizations?
a. In most HR practices, both organizational and national culture has an effect.
b. The most important factor (among the three cultures) affecting actual HR practices
implemented by organizations is organizational culture.
c. The effect of organizational culture on actual HR practices is stronger in certain
dimensions of national and professional cultures (future orientation dimension has the
strongest effect).
d. Distance between all dimensions of the three cultures (national, organizational and
professional) affects the implementation of HR practices in organization (all five
dimensions has an effect).
4. How do employees react psychologically to a fit/misfit between their preferences for
HR practices and the actual HR practices, in terms of job satisfaction,
organizational commitment, and satisfaction from HR practices?
a. Fit between employees’ preference of HR practices and actual HR practices in the
organization (regarding performance appraisal, flexible work arrangements,
compensation, recruitment, autonomy level, relocation and termination) enhances
satisfaction from HR, job satisfaction and commitment level of the employees.
5. How is the fit/misfit between the employees’ preferences for HR practices and the
actual HR practices related to the organizational performance indicators of
absenteeism, turnover, and organizational performance outcomes?
a. Fit between employees’ preference of HR practices and actual HR practices in the
organization (regarding performance appraisal, flexible work arrangements,
compensation, recruitment, autonomy level and relocation) reduces absenteeism and
turnover rate and enhances organizational performance indicators.
59
Chapter 5: Conclusions and implications
The goal of this study was to enhance our knowledge and understanding of employee
attitudes and behavior in organizational settings. The importance of global studies such as this
one is growing because of the increased number of multinational corporations (MNCs) operating
in different countries across the globe. Despite the growing importance of a global perspective in
research and practice, it remains difficult to generate substantive studies linking all aspects of
culture and HR practices in the global arena. This research attempts to remedy this deficiency by
systematically exploring the prevalence and effects of HR practices in the multi-level contexts of
national, organizational, and professional cultures. This study contributes to the literature on
strategic human resource management by enhancing our understanding of the competitive
advantage of HR practices for global companies, contingent on cultural contexts. Moreover, in
this study we responded to the call in the literature to examine the role of moderators on the
effect of cultures on work outcomes (e.g., Taras et al., 2010).
In this study, we conducted comprehensive analyses on a new large data set from several
multinational companies, exploring how national, organizational and professional cultures affect
various key human resource practices independently and jointly, and the important effect of level
of fit between the three cultures, and between preferred and actual HR practices on various
organizational performance indicators. We provided evidence that national culture has the
strongest effect on preferred HR practices by employees, while organizational culture has the
strongest effect on actual HR practices implemented by organizations. Second, we showed that
distance between the cultural types affect both preferred HR practices and actual HR practices
implemented by the organizations. Third, we supported the notion that when there is a lack of fit
between employees’ preference of HR practices and actual HR practices in the organization, the
consequences on organizational performance indicators are negative. On the other hand, when
there is a fit between HR preferences and HR activities, organizational performance improves.
Finally, we found that lack of fit between the three cultures tend to have adverse effect on
organizational performance indicators.
The findings of the study have important theoretical and practical contributions.
Theoretically, the study provides support for the contingent approach (e.g., Delery and Doty,
1996, and Rousseau & Fried, 2001) which argues for a contingent impact of HRM practices on
organizational outcomes. Rogers and Wright (1998) suggested that despite evidence supporting
60
the relationship between HRM practices and organizational performance, this relationship is not
universal or consistent (e.g. Rogers and Wright, 1998) In order to fully understand the effect of
HR activities on organizational outcomes, it is necessary to understand the context in which the
organization exists. As our study indicates, one key contextual variable that can affect the
impact of HR activities is culture.
Practically, the study generates useful information for organizations and managers on the
successful use of HR practices in different cultures at the national, organizational, and
professional levels. From a practical point of view, the study can help multinational companies
(MNCs) determine the degree to which transferring HR practices from the corporate
headquarters to subsidiaries in other countries will be effective or detrimental to employee
reactions and indicators of organizational performance. Such information should enable
managers who are responsible for global operations to more effectively determine what HR
programs to implement in organizations that are based or operate in different cultures, and which
characteristics these programs should have to maximize their contribution to organizational
competitiveness. For example, two major practical conclusions are emerged:
 In the global economy multinational organizations should take into account the
characteristics of the societal cultures in which their subsidiaries are located,
before
deciding whether to implement a particular HR activity and selecting characteristics of
this activity. Failure to do so is likely to result in adverse effects on performance-related
indicators.

Multinational organizations should fit the organizational culture of the subsidiaries to the
local national culture in which they operate in order to enhance organizational
performance. Moreover, professional culture should also be taken into account together
with national and organizational cultures, as a basis for the decision to implement
particular HR activities. Interestingly, implementing a “one size fits all” human resource
practices in all the subsidiaries across the corporation is likely to reduce psychological,
behavioral and performance outcomes.
61
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