Competencies for Human Resource Management in Foreign-Owned Firms. Focus on Three CEE Countries and Austria

Foreign-owned firms enter foreign markets for traditional reasons (market acquisition, securing resources, and diversification), but lately they have also been seeking better economies of scale and a more rational allocation of expenditures, via shifting processes and activities to lower-cost countries. The aim of this paper is to analyse the major foreign direct investments (FDI) and impacts on Human Resource Management through seven case studies in Austria, Czech Republic, Hungary and Slovakia. Multinational Corporations are considered the driving force behind the internationalization of business. The shift from a domestic to a global business perspective also has a profound impact on corporate human resources management activities. The analysis confirms the general viewpoint in literature that HR work in subsidiaries of MNCs has shifted from an administrative role to a strategic contributor role. The strategic impact is especially big when it comes to fields which need to be “culturally translated”: recruitment, compensation and benefits, and talent management. However, that influence is still limited to national HR work on a national level.