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Article
Publication date: 5 April 2021

Jonna Ristolainen, Virpi Outila and Rebecca Piekkari

The purpose of this paper is to explain the reversal of language hierarchy in a Finnish multinational corporation (MNC) from a political perspective. This paper situated the…

Abstract

Purpose

The purpose of this paper is to explain the reversal of language hierarchy in a Finnish multinational corporation (MNC) from a political perspective. This paper situated the language hierarchy in the historical context of the colonial-style relationship between Finland and Russia. From a post-colonial perspective, the colonial legacy of Russia has had an influence on language strategy and everyday translation work in the Finnish multinational until the present day.

Design/methodology/approach

This paper undertook a case study based on qualitative secondary analysis of existing data sets. These data sets originated from two previously conducted studies of the same Finnish MNC.

Findings

The findings revealed a reversal of the traditional corporate language hierarchy. Russian, as the host country language of powerful local subsidiaries, rose to the top of the hierarchy at the expense of English, the common corporate language, and other languages. The colonial-style relationship was enacted by professional and paraprofessional translators who collaborated by using “the master’s language and imitating the master’s voice” to reap the strategic benefits of local responsiveness.

Originality/value

In contrast to previous work drawing on post-colonial theory in the study of MNCs, this paper represents the headquarters in Finland as the “colonised” party and the Russian subsidiaries as the “coloniser.” Owing to its colonial legacy, Russian, the host country language, became very powerful and influenced the language strategy of the entire MNC. This paper conceptualized translation as a multilevel phenomenon and offers a holistic explanation of why the language hierarchy in the Finnish MNC was reversed.

Details

critical perspectives on international business, vol. 19 no. 1
Type: Research Article
ISSN: 1742-2043

Keywords

Book part
Publication date: 24 November 2017

Alexander Bulatov, Alexey Kuznetsov, Yuri Kvashnin, Alice Maltseva and Ninel Seniuk

Russia is one of the leaders in outward FDI from emerging market economies and at the same time Russian MNCs have their specific features. The purpose of this chapter is to…

Abstract

Purpose

Russia is one of the leaders in outward FDI from emerging market economies and at the same time Russian MNCs have their specific features. The purpose of this chapter is to analyze characteristics of Russian MNCs by researching relationship between specificities of Russian economic and political model, on the one hand, and specific features of Russian MNCs, on the other hand.

Methodology/approach

For these researches, traditional instruments of neoclassical theory are basically used.

Findings

The principal finding is that specific characteristics of Russian MNCs reflect specificities of Russia’s economic and political model. To some extent, they correlate with characteristics of MNCs of other two leading emerging economies – China and India.

Research limitations/implications

Russian MNCs operate in line with principal theories of FDI, that is, on the basis of their country and firms’ comparative advantages. However, they possess specific features: many of them are state-controlled MNCs; private MNCs are controlled by oligarchs; all of them have tight relations with offshores and offshore conduit countries. The comparison with China and India shows that some of these specific features are typical of Chinese and Indian MNCs to more or less extent.

Practical implications

The empirical part of the chapter analyzes scope, industrial and geographical profiles of Russian MNCs, their motivation and management, impact on Russian economy and regional integration.

Social implications

National MNCs with their offshore affiliates are the leading tax evasion economic agents in Russia. Moreover, stable FDI outflow reduces gross capital formation in Russia which is insufficient (19–25% of GDP) for substantial economic growth by standards of emerging economies in this decade (from 4.3 to −3.8 in Russia, from 6.8 to 9.5 in China, from 5.1 to 7.3 in India).

Originality/value

The principal value (originality) of the chapter is its comparatively detailed review of main aspects of Russian MNCs’ worldwide activity made from the point of view of its connection to Russia’s economic and political model.

Details

The Challenge of Bric Multinationals
Type: Book
ISBN: 978-1-78635-350-4

Keywords

Book part
Publication date: 24 November 2017

Timur Atnashev and Teimuraz Vashakmadze

To analyze internationalization patterns among large Russian multinational corporations (MNCs).

Abstract

Purpose

To analyze internationalization patterns among large Russian multinational corporations (MNCs).

Approach

Case study analysis of systematic internationalization attempts within three industries: IT, banking, and steel. For case studies, secondary data was used along with industry expert interviews.

Findings

The first finding is that Russian firms actively pursuing internationalization strategies through mergers and acquisitions (M&As) and greenfield investments were not as successful as several optimistic assessments had earlier suggested. Few global corporate champions emerged among Russian MNCs, despite a decade of record high outward foreign direct investments (OFDI). Secondly, we observed the unique trend of splitting operations between international and Russian businesses, which proved more sustainable than operating as a single firm. For example, the IBS-Luxoft group achieved success through gradual legal and organizational separation of branches in order to serve rising demand in developed markets and from its Russian business within the same industry. This double-headed strategy divides a business into two parts that are controlled by the same owners, but operate independently: one firm operates within the home market, while another firm aims to expand globally. This seems to be a typical trend, confirming recent findings for Russian small and medium enterprise (SME) internationalization and reinforcing earlier literature on institutional constraints in the Russian economy.

Research limitations

We analyzed major cases from three actively internationalizing industries. For each industry, we extensively analyzed one main case in particular. Industries’ choice also affects specific internationalization strategies.

Originality

This study identifies two distinct approaches in the literature on Russian business internationalization and attempts to combine both. We will also highlight organizational dilemmas as well as patterns in Russian businesses’ successful and failed internationalization strategies over the last decade. We identified an original double-headed internationalization strategy consisting of the separation of the national and global businesses, rather than leveraging their synergy. We will also question the established optimistic assessment of Russian MNC internationalization.

Book part
Publication date: 29 July 2019

Natalia Guseva and Olga Tishchenko

This chapter examines the possibilities of economic growth in Russia from the perspective of the development of organizational capability, namely through the study of best…

Abstract

This chapter examines the possibilities of economic growth in Russia from the perspective of the development of organizational capability, namely through the study of best managerial practices of multinational companies (MNCs) doing business in Russia, and their use by Russian companies. With tightening competition, companies are forced to focus on the development of organizational capabilities. Our large-scale empirical research into the managerial capabilities and management practices of MNCs and Russian companies employs a comprehensive sample of 1,530 companies and 1,245 companies in 2016 and 2017, respectively, covering the 10 main sectors of economic activity in Moscow and the Moscow region. The analysis was performed across five managerial capabilities: communication, leadership, problem-solving and decision-making, conflict resolution, and motivation, each subdivided into five management practices. Using statistical methods, we identified the major statistically significant differences in and between the managerial practices of MNCs and Russian companies operating in the Russian market, and their dynamics from 2016 to 2017. Taking MNCs operating in the Russian market as a benchmark, we discover that Russian companies need to close the gap in 17 out of the 25 managerial practices in order to maintain competitiveness in the Russian market and be able to influence their economic growth in Russia.

Details

Tech, Smart Cities, and Regional Development in Contemporary Russia
Type: Book
ISBN: 978-1-78973-881-0

Keywords

Book part
Publication date: 11 November 2014

Snejina Michailova and Kseniya Nechayeva

This paper examines how personal networks influence the internationalization process of Russian multinational corporations.

Abstract

Purpose

This paper examines how personal networks influence the internationalization process of Russian multinational corporations.

Design/methodology/approach

We identify and review 78 articles published in five International Business journals that address the role of networking and relationships in firm internationalization. We then use the network perspective to examine how Russian multinationals internationalize.

Findings

Combining the key conclusions of the reviewed studies with insights from the network perspective, and adding insights that we have gained both through first-hand experience and by following the Russian business media, we develop a model that links personal networking and Russian multinationals’ internationalization. We outline four functions that personal networking plays – access to information and knowledge, resource commitment, development of marketing and sales capabilities, and further network expansion.

Originality/value

This paper challenges established views of how firm internationalization occurs. It combines two previously unrelated streams of literature, the network model of internationalization and the role of personal networking within the Russian business environment, and argues that personal networking plays a much larger role in how Russian MNCs internationalize than has the International Business literature has acknowledged.

Details

Emerging Market Firms in the Global Economy
Type: Book
ISBN: 978-1-78441-066-7

Keywords

Article
Publication date: 11 January 2011

Thomas Steger, Rainhart Lang and Friederike Groeger

The purpose of this paper is to provide an in‐depth description of the process of institutionalisation and development of human resource management (HRM) practices in subsidiaries…

7427

Abstract

Purpose

The purpose of this paper is to provide an in‐depth description of the process of institutionalisation and development of human resource management (HRM) practices in subsidiaries of German multinational companies in Russia.

Design/methodology/approach

The study is based on nine case studies of Russian subsidiaries including 26 interviews (13 German expatriates and 13 local employees), participative observations and document analyses. The data analysis follows a qualitative methodology.

Findings

The study provides four patterns of institutionalisation processes of HRM practices. They stress the importance of personal, institutional and contextual factors for the institutionalisation of HRM practices. Moreover, the key role of expatriates with their specific value orientations and behaviour in this process is highlighted.

Research limitations/implications

One suggestion for further research would be to replicate the study quantitatively (in order to get more cases) as well as qualitatively (to get broader inter‐cultural data). Furthermore, it would be valuable to take a more long‐term focus to examine the described institutionalisation paths in the long run.

Practical implications

The paper highlights the importance of personal characteristics of expatriates that are often underestimated in companies' selection procedures. Moreover, the connection between the parent company's strategy and the pattern of institutionalisation of HRM practices should make the company management reflect upon the preferred pattern before taking the basic decisions. Taking into account the strong economic relationship between Russia and Germany and the expected further development of joint activities, the paper provides also important insights for the use of German expatriates in Russia.

Originality/value

This paper improves our comprehension of the complex process of implementation and institutionalisation of HRM practices abroad. Moreover, it contributes to the HRM literature as it employs the concept of “transnational spaces” as an alternative and additional approach to explain this process. The resulting patterns may not be restricted to the Russian case only but should be adaptable to other emerging countries as well.

Details

Baltic Journal of Management, vol. 6 no. 1
Type: Research Article
ISSN: 1746-5265

Keywords

Article
Publication date: 1 March 2013

Päivi Karhunen and Riitta Kosonen

This paper seeks to discover whether and how a subsidiary located in a high‐corruption host country can pursue its parent's corporate non‐corrupt strategy, rooted in a…

1363

Abstract

Purpose

This paper seeks to discover whether and how a subsidiary located in a high‐corruption host country can pursue its parent's corporate non‐corrupt strategy, rooted in a low‐corruption home country. Theoretically, it aims to apply the construct of institutional duality. It also aims to argue that the subsidiary's strategic response is contingent to the relative strength of two sets of institutional demands: the articulation of the multinational company's (MNC's) corporate policy towards corruption; and the direct influence of the host country corruption on the subsidiary's daily business.

Design/methodology/approach

A qualitative analysis of interviews with executives of 27 Finnish companies (15 large MNCs and 12 small to medium‐sized enterprises (SMEs)) with subsidiaries in Russia was conducted.

Findings

The subsidiary's strategic response to host country corruption is contingent to the firm size and the respective resources. Large MNCs can implement their non‐corrupt policy also in their Russian subsidiaries due to their financial and relational resources. SMEs, which lack such resources, need to adapt to the demands from the corrupt environment. This is usually done by “outsourcing” situations prone to corruption to a local intermediary.

Research limitations/implications

The empirical analysis is limited to one pair of countries (Russia and Finland) and selected locations in Russia (Moscow and St Petersburg).

Practical implications

The paper provides examples of business strategies that help to mitigate the negative consequences of host country corruption without giving up one's moral and ethical principles.

Originality/value

The paper enriches the literature on corruption in international business by identifying the firm size as a key determinant for strategic responses to host country corruption.

Details

Critical perspectives on international business, vol. 9 no. 1/2
Type: Research Article
ISSN: 1742-2043

Keywords

Article
Publication date: 7 August 2017

Igor Gurkov, Evgeny Morgunov and Zokirzhon Saidov

The purpose of this paper is to retrace the sources of robustness of the operations of Russian manufacturing subsidiaries of western multinational corporation (MNC) during the…

Abstract

Purpose

The purpose of this paper is to retrace the sources of robustness of the operations of Russian manufacturing subsidiaries of western multinational corporation (MNC) during the downturn, from the point of view of applied human resource management (HRM) practices.

Design/methodology/approach

A repeated survey of heads of Russian manufacturing plants of western MNCs was implemented. The same respondents aswered the similar questions in 2014 and in 2016.

Findings

The current evolution of HRM arrangements in the Russian manufacturing subsidiaries of MNCs can be explained by an attempt for ambidexterity. On the one hand, managers of the Russian manufacturing subsidiaries of MNCs attempt to prevent employee alienation. Thus, they retain permanent contracts and preserve guarantees of home-take pay. On the other hand, there is the elimination of several social benefits. In the author’s opinion, the cost-minimization approach has been used excessively. The authors speculate that the system of social benefits will need to be adjusted again to transform the system from one that is “crisis-proof” to one that is “stagnation adapted.”

Originality/value

The findings provide a basis for a broader discussion on mutation of HRM systems in manufacturing subsidiaries of MNCs facing deteriorating market conditions.

Details

Employee Relations, vol. 39 no. 5
Type: Research Article
ISSN: 0142-5455

Keywords

Book part
Publication date: 28 June 2016

Irina Paladi and Pierre Fenies

The purpose of this chapter is to provide a comprehensive review of empirical research on performance management (PM) in former communist Central and Eastern European (CEE…

Abstract

Purpose

The purpose of this chapter is to provide a comprehensive review of empirical research on performance management (PM) in former communist Central and Eastern European (CEE) countries, to evaluate the state of knowledge in this area and suggest possible directions for future research.

Methodology/approach

An examination of the literature was undertaken to review the empirical studies treating on PM in ex-communist countries from CEE. A total of 96 journal articles, PhD thesis, and conference papers were identified, categorized, and analyzed according to research questions, methodology, and theoretical framework. Contributions are classified by countries, according to progress in transition process (post-transition/transition countries) and membership in the Soviet Union (Soviet/non-Soviet countries). The review examines publications in four languages (English, French, Romanian, and Russian).

Findings

The literature review identified various stages of development of PM research and practice in the different groups of CEE countries.

In post-transition CEE countries, PM research follows the trends settled up in the developed countries (quantitative studies examining the extent of usage of different PM tools, influence of contingent factors, relationship PM-strategy, and impact on company’s performance). Also, the findings illustrate the modernization of PM practices: increasing importance of nonfinancial indicators and integrated performance management systems (PMS), although financial indicators are prevailing.

On the contrary, in transition countries PM research and practices are at an early stage, the reviewed literature highlights some specific issues related to transition context: the dynamic aspect of PM, change management, importance of informal systems, cultural aspects, and business traditions.

Research limitations

Because of the large number of CEE countries and the diversity of their national languages, many studies conducted in native languages have not been addressed in this literature review, which is essentially based on publications in English and French. Only for three CEE countries (Russia, Romania, and Moldova) publications in national language were considered.

Practical implications

This literature review may be useful for practitioners, providing insights on the extent of diffusion and usage of different PM tools and identifying difficulties and pitfalls to avoid in their implementation.

Originality/value

The chapter represents one of the first contributions to the knowledge about PM research and practice in former communist CEE countries. The adopted framework for reviewing and classifying the literature allows identifying the differences in PM research and practices between post-transition/transition and Soviet/non-Soviet countries.

Details

Performance Measurement and Management Control: Contemporary Issues
Type: Book
ISBN: 978-1-78560-915-2

Keywords

Article
Publication date: 12 March 2018

Sari Laari-Salmela, Tuija Mainela, Elina Pernu and Vesa Puhakka

The purpose of this paper is to examine subsidiary positioning within the dynamic business networks in the context of multinational companies (MNCs). The research question of the…

Abstract

Purpose

The purpose of this paper is to examine subsidiary positioning within the dynamic business networks in the context of multinational companies (MNCs). The research question of the study is: How does the positioning of a subsidiary emerge through strategic practices in the dynamic business networks of an MNC?

Design/methodology/approach

The study relies on the IMP view on strategy with a focus on market positioning activity and the strategy-as-practice approach. Positioning is seen as a question of strategic practices in the interactive spheres of the subsidiaries. In the empirical part of the study, the authors examine the practices of a forest machine industry multinational through longitudinal interview and archival data on three of its sales subsidiaries in Sweden, Russia and the USA.

Findings

The study defines core tensions in subsidiary interactive spheres and the related strategic practices that shape the positioning of the subsidiaries. The study models the practice-based network positioning of MNC subsidiaries as a dynamic play of relationship tensions.

Originality/value

Prior research has focused either on the internal organizing of the MNCs or embeddedness of subsidiaries in their local environment. Less attention has been paid to the practices of positioning through which the subsidiaries deal with the inevitable tensions at the intersection of the internal and external networks.

Details

IMP Journal, vol. 12 no. 1
Type: Research Article
ISSN: 2059-1403

Keywords

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