The transferability question: comparing HRM practices in the ...

The transferability question: comparingHRM practices in the Philippineswith the US and Canada1

Maria Carmen Galang

Abstract A survey of Philippine corporations was conducted to find out the prevalenceand impact of practices in hiring, training and development, performance appraisal,pay and occupational health and safety. Overall, many of the practices that are prescribedin Western management can be found in most of the responding firms. Organizationalcharacteristics were also found to be associated with some of the practices. Many practiceswere related to perceived organizational performance but only a few practices to voluntaryturnover rate. Comparisons with US and Canadian data show that there were differences inmost practices, but with the Philippines showing a higher extent of the HRM practice, andmore correlations with organizational characteristics than the US and Canadian samples,suggesting that many of the practices developed in the West are easily transferred. Possibleexplanations examined include differences in country context, differences in samplecharacteristics and methodological artefacts from cross-cultural non-equivalence.

Keywords HRM practices; Philippines; comparative studies.

The question of transferability of management practices still remains paramount inthe minds of international managers, primarily because of a dearth of empirical evidenceand inadequate conceptual frameworks that can provide more specific guidelines.The current study attempts to fill the first gap by providing empirical data on anAsian country that has not been well researched but which promises potential forinternational business. The Philippines has a largely English-speaking population of morethan 75 million with an adult literacy rate of 94 per cent. Its performance in the economiccrisis that hit the East Asian region in mid-1997 provides confidence for foreigninvestment: it still posted positive, although modest, growth rates, and instituted soundfiscal and economic reforms (Lim, 1999). Political risks may be a concern, but judgingfrom the past two recent political upheavals,2 turnover in power is usually quick, withrelatively minimal disruption.

A survey of the top 1,000 corporations in the Philippines was undertaken in late 1998to examine the question of transferability of various human resource management(HRM) practices commonly found or prescribed in Western management. Specifically,the survey sought to determine (1) the prevalence of such practices in the Philippines,(2) the nature of the business organizations in which these practices are utilized,and (3) the organizational outcomes that are associated with such practices.

The International Journal of Human Resource Management

ISSN 0958-5192 print/ISSN 1466-4399 online q 2004 Taylor & Francis Ltd

http://www.tandf.co.uk/journals

DOI: 10.1080/0958519042000238419

Maria Carmen Galang, Faculty of Business, University of Victoria, PO Box, 1700 STN CSC, Victoria,

BC, Canada V8W 2Y2 (fax: þ250 721 6067; e-mail: [email protected]).

Int. J. of Human Resource Management 15:7 November 2004 1207–1233

The Philippine survey is part of the ‘best practices in HRM’ research consortium, whichprovided comparative data on the practices in the United States and Canada.

The ‘Best Practices’ consortium

In 1991, a consortium of researchers from various institutions worldwide was created toaddress the following questions (Teagarden et al., 1995; Von Glinow, 1993):

. Which HRM practices are most used currently? How effective are these practices?

. Which practices are related to organizational effectiveness and to employee jobsatisfaction?

. Are there universal best HRM practices or only situation-specific best practices?

. Does HRM effectiveness vary with business strategy, national culture or subculture,or the firm’s external environment?

Data are now available from twelve other countries – Australia, Canada, China(People’s Republic), Indonesia, Japan, Kenya, South Korea, Mexico, Peru, Taiwan, theUnited States and Venezuela – and two regions – Latin America and the Gulf states.

The consortium arrangement addresses the difficulties in international managementresearch (e.g. complexity, cost, access, time constraints, methodological challenges).Collection of country data is undertaken and personally funded by each member, but, bypooling together these various data sets, all members have access to data that one might nototherwise have had because of resource constraints. Because members also either comefrom or have substantial exposure to and understanding of the country being surveyed,the ethnocentric bias that has plagued much of international research is reduced. Eachmember is able to reformulate the questions so as to achieve conceptual equivalence.Although a standardized questionnaire is used so that data can be compared, theconsortium arrangement also allows each member to incorporate other items of personalinterest, while keeping in mind the practical consideration of the questionnaire’s length.

Existing literature

One of the primary driving forces when the best practices project started was to provideguidance to business decision-makers in an increasingly global world, in terms of the bestway to manage human resources that would benefit both the organization and itsmembers given various contextual characteristics (e.g. culture). Is the practice in countryA used in country B, and with the same positive results? The current state of research andtheory is not able to provide adequate answers (Teagarden and Von Glinow, 1997;Tung and Punnett, 1993).

There is not much work covering several different countries simultaneously, andthat was the impetus for the best practices consortium (Von Glinow, 1993).The Price Waterhouse Cranfield Project (Brewster, 1993) surveyed selected Europeancountries, but none of the emerging economies so far. Moore and Jennings (1995)covered Pacific Rim countries, and Pieper (1990) included several countries aroundthe globe (both excluding the Philippines however). Verma et al. (1995) covered thenewly industrializing economies in Asia including the Philippines. The country reportsin Moore and Jennings (1995), Pieper (1990) and Verma et al. (1995) are based on amore qualitative approach, and often do not cover the same range of HRM practices.The best practices project, on the other hand, utilizes the same data-gathering instrumentthat would provide quantitative comparisons, and aims to cover countries in differentregions of the world.

1208 The International Journal of Human Resource Management

The development of theory that incorporates an international perspective has barelystarted (Teagarden and Von Glinow, 1997). Given the global scope of the best practicesproject, we are able to encompass different contexts that will eventually provideempirical support for a comprehensive theory that identifies the salient factorsdriving differences and similarities, as well as factors influencing successful transfer.What empirical research is available has been limited to a few countries or a particularregion (e.g. Brewster, 1993; Moore and Jennings, 1995) and therefore is not a sufficientbasis for making generalizations. Hence, there are as yet no definitive answers to what isuniversal, and what is context-specific, however ‘context’ is defined (e.g. cultural, legal,political, economic conditions of a country).

Methodology

A fourteen-page questionnaire was mailed in 1998, half from Canada and half from thePhilippines. Jobber and Saunders (1988) have shown that the country of origin of the mailsurvey affects the response rate, but that such effects would differ depending on thecountry involved. My contacts in the Philippines had advised that a survey originatingfrom an overseas university would have some prestige and credibility and thereforeincrease response rates. No study has been done on the Philippines, so that informationgathered from this strategy would be useful for future surveys in the Philippines.

In terms of response rate, there was not much difference: eighty-two returns fromthose mailed in the Philippines and eighty-six from those mailed in Canada. In terms oforganizational characteristics, chi-square analysis found significant differences in onlytwo aspects, employment size and unionization. There were more companies that werebigger (more than 1,000 employees) among those who responded to the Canadianmailing, with twenty-five respondents (37 per cent less missing answers) as opposed toten respondents (15 per cent) in the Philippine mailing, and there were more companiesthat had fewer than 250 employees in the Philippine mailing, with thirty respondents(41 per cent) as opposed to fifteen respondents (22 per cent) in the Canadian mailing.The respondents from the Canadian mailings were also more unionised (62 per cent ofsample, n ¼ 41) while those in the Philippine mailing were more non-union (56 per cent,n ¼ 38). In terms of HRM practices, only with respect to experience as a hiringcriterion and training as a reward did the two groups differ, with the Philippine mailinghaving a higher mean for experience and the Canadian mailing having a higher mean forthe training practice.

Follow-ups were made to ensure a higher response rate (Ferrell and Krugman, 1983):first, a postcard reminder, with the necessary contact numbers to request replacementcopies if needed; second, a telephone follow-up; third, a new cover letter and a complete setof survey materials. As a way of enticing respondents to complete the survey, a stampedenvelope addressed to the research assistant based in the Philippines was provided and asummary report offered to respondents. Ninety-three of the whole sample (55 per cent)responded they wanted a copy of the report, and there were no differences in terms oforganizational characteristics between those wanting a copy and those who did not.

Variables3

HRM practices

The practices covered by the survey included the functional areas of hiring (number ofpractices ¼ 8), training and development ðn ¼ 10Þ; performance appraisal ðn ¼ 11Þ; payðn ¼ 9Þ and occupational health and safety ðn ¼ 10Þ; for a total of forty-eight practices.

Galang: The transferability question 1209

Respondents were asked the extent to which the listed items applied to their organization,using the following scale: 1 ¼ not at all; 2 ¼ to a small extent; 3 ¼ to a moderate extent;4 ¼ to a large extent; 5 ¼ to a very great extent.

Organizational characteristics

Information about employment size, unionization, industry, foreign ownership, productdiversity and organizational life cycle was also gathered. In addition, perceivedcompetitiveness of the business environment and status of the HRM department weremeasured through a 5-point scale, with only the extreme ends anchored as ‘very false’ for1 and ‘very true’ for 5. Perceived competitiveness of the business environment consistedof four statements: marketplace competition has increased dramatically; conditions inour business environment are rapidly changing; government regulations are rapidlychanging; the technology in our product/services is complex. Internal reliability for thisscale was at a ¼ 0:67: Status of the HRM department was the average rating given tofour statements: it is viewed as an important department in the company; it works closelywith the senior management group on the key strategic issues facing the company;it seems to keep informed about the best human resource management practices that areused in other countries; it is viewed as an effective department. Internal reliability was ata ¼ 0:83: The average score was computed only for those respondents who indicatedthat they had a separate HRM unit.

Organizational outcomes

Perceived organizational performance was measured by a 5-point scale consisting of tenitems, with internal reliability at a ¼ 0:92: Respondents were asked how accurately eachof the following described their respective companies (1 ¼ very false and 5 ¼ very true):produces high quality goods; has a promising future; manages its people well; is flexibleenough to change; has high quality people; has strong unified culture; is very effectiveoverall; has very satisfied workforce; has very productive workforce, and is seen asleader in industry.

Voluntary turnover rate was determined by the question: ‘About what voluntaryturnover rate has your company had in the last year?’ with an option to answer‘don’t know’.

Results of the Philippine survey

Profile of respondents

Responses to the mailed questionnaire were received from 168 organizations. Leavingout the questionnaires that were returned undelivered ðn ¼ 27Þ; this constitutes aresponse rate of 17.2 per cent. Most of the organizations belong to the services sector(55 per cent), while 32 per cent are in manufacturing, with most (60 per cent) havingmore than one related product/service. The majority (74 per cent) have 1,000 or feweremployees, with an average voluntary turnover rate of 8.19 per cent. A little over half(53 per cent) are unionized; and, among those unionized, 57 per cent have more thanhalf of their employees belonging to the union(s). Of those who responded to the foreignownership question (n ¼ 81; 48 per cent), thirty-six indicated that they are wholly locallyowned, and twenty are 100 per cent foreign-owned. Only five organizations (3 per cent)did not have a separate HRM unit. HRM departments had an average of 14.4 employees,ranging from a minimum of one to a maximum of 197, with the median at eight.


Most of the individuals who filled out the questionnaire hold jobs in HRM (78 per centof all respondents), and have an average tenure of 7.67 years in the company and 5.69years in the position. The majority are less than 40 years old (53 per cent) and female(58 per cent). Except for one, all completed post-secondary education (four-year degree),with 41 per cent having some graduate work and 27 per cent a graduate degree.

Extent of HRM practices

Table 1 shows the percentage of firms utilizing each of the listed practices, among thosethat responded to the particular item. For all practices, except for two under hiringcriteria, there were at least some firms reporting that the specified item did not apply.The top five practices, with the most number of firms reporting that the practice applied atleast to some extent, are the hiring criteria of proven work experience in a similar job(n ¼ 166; 100 per cent), ability to perform technical job requirements (n ¼ 165; 100 percent) and potential to do a good job (n ¼ 163; 98.2 per cent), training toimprove technical job abilities (n ¼ 165; 98.2 per cent), and performance appraisalto document subordinate’s performance (n ¼ 165; 98.2 per cent). The bottom five

Table 1 Frequency distribution (%) of HRM practices in the Philippines

Practice Not

at all

Small

extent

Moderate

extent

Large

extent

Very

great

extent

Hiring criteria

Ability to perform technical

job requirements

0 3.0 18.2 44.8 33.9

Ability to get along well

with others

2.4 9.1 38.8 40.6 9.1

Right connections 21.7 25.9 26.5 21.1 4.8

Belief that person will stay

with company

5.5 15.8 37.0 27.9 13.9

Proven work experience

in similar job

0 4.8 20.5 44 30.7

Potential to do a good job 1.8 10.8 41.6 33.1 12.7

Fit with company’s

values & ways

2.4 7.2 33.1 38.6 18.7

Future co-workers’ opinions 33.1 29.5 24.1 12.0 1.2

Training purposes

Provide reward to employees 10.2 31.9 33.7 19.3 4.8

Improve technical job abilities 1.8 10.1 28.6 36.3 23.2

Improve interpersonal abilities 2.4 16.7 33.9 32.7 14.3

Remedy past poor performance 5.4 17.9 44.0 20.2 12.5

Prepare employees for future job

assignments

3.0 18.0 30.5 32.9 15.6

Build teamwork within company 3.6 12.5 35.1 28.0 20.8

Initial training for new employees 5.4 25.1 34.1 24.6 10.8

Help employees understand

the business

4.8 24.4 39.3 22.0 9.5

Provide skills for a number of

different jobs

7.1 19.6 35.1 27.4 10.7

Teach employees about

company’s values

3.0 21.6 29.3 30.5 15.6


Table 1 (Continued)

Practice Not

at all

Small

extent

Moderate

extent

Large

extent

Very

great

extent

Appraisal purposes

Determine appropriate pay 7.7 23.8 28.6 28.6 11.3

Document subordinate’s

performance

1.8 8.3 29.2 38.1 22.6

Plan development activities 5.4 22.0 33.3 25.0 14.3

Salary administration 9.0 15.0 33.5 25.7 16.8

Recognition of subordinate

for things done well

2.4 13.1 32.1 34.5 17.9

Lay out specific ways

to improve performance

3.0 21.4 29.2 27.4 19.0

Discuss subordinate’s views 8.3 25.0 30.4 24.4 11.9

Evaluate subordinate’s

goal achievement

7.1 16.1 35.7 24.4 16.7

Identify subordinate’s

strengths & weaknesses

3.6 11.9 32.1 32.7 19.6

Allow subordinate to

express feelings

7.7 24.4 31.5 24.4 11.9

Determine subordinate’s

promotability

2.4 9.0 40.1 28.1 20.4

Pay

Incentives as important part in

pay strategy

10.3 18.2 22.4 28.5 20.6

Benefits as important

part of total pay package

2.4 7.8 19.3 41.0 29.5

Portion of earnings contingent

on group performance

14.2 22.8 25.9 23.5 13.6

Long-term results more important 10.9 27.3 26.7 25.5 9.7

Seniority does not enter into pay

decisions

10.3 25.5 35.2 21.8 7.3

Incentives significant portion of

total earnings

9.6 26.9 31.3 27.7 5.4

Very generous employee

benefits package

7.3 20.6 28.5 33.9 9.7

Futuristic orientation of pay system 17.0 31.5 28.5 17.0 6.1

Job performance mainly

determines pay raises

5.4 22.3 27.7 27.1 17.5

Health & Safety (HS)

HS is considered top priority 4.3 14.7 31.9 28.8 20.2

HS management as a

strategic concern

3.7 17.8 33.1 30.7 14.7

Existing HS programme

is very cost effective

6.3 11.3 42.8 30.2 9.4

Very proactive HS programmes 7.4 17.2 36.2 27.6 11.7

Objectives clearly understood

by employees

7.4 25.9 33.3 24.7 8.6

Active promotion of HS programmes 7.5 21.3 31.3 27.5 12.5

Safety as an individual’s

principal responsibility

3.7 19.3 39.1 27.3 10.6


practices (with the most number of firms indicating that this practice does not apply at all)are the use of future co-workers’ opinions as a hiring criterion (n ¼ 55; 33.1 per cent),top management as a significant barrier in health and safety programmes (n ¼ 43;27 per cent), right connections as a hiring criterion (n ¼ 36; 21.7 per cent), regularconduct of health and safety inspections of work sites (n ¼ 32; 19.9 per cent) andfuturistic orientation of the pay system (n ¼ 28; 17 per cent).

Organizational characteristics

Various statistical analyses (e.g. t-tests, one-way analyses of variance and bivariatecorrelations), depending on the nature of the scale used to measure the variable, wereconducted to determine whether HRM practices differed according to the followingorganizational characteristics: employment size, unionization, industry, productdiversity, life cycle, foreign ownership, perceived competitiveness of the environmentand status of the HRM department. Table 2a shows the F, t and r values from thesestatistical analyses for hiring, training, performance appraisal and pay, and Table 2b forhealth and safety practices.

The status of the HRM department accounted for significant differences in almost allHRM practices (forty-two practices, or 88 per cent of all practices listed). This result maynot be surprising considering that numerous studies in the US have found positive andsignificant relations between the presence of a HRM department and HRM practices(Galang and Ferris, 1997). The six exceptions are the use of right connections, futureco-workers’ opinions and ability to get along well with others as hiring criteria; senioritynot entering into pay decisions; lack of top management support in occupational healthand safety, and legal compliance as main reason for health and safety programmes.

The next organizational characteristic that accounts for many differences in HRMpractices is perceived competitiveness of the environment: almost all the purposes listedfor performance appraisal (number of practices ¼ 9, 82 per cent) except for documentingsubordinates’ performance and salary administration; and almost all items under healthand safety (n ¼ 7; 70 per cent), except for existing health and safety programme as verycost effective, the lack of top management support as a significant barrier and legalcompliance as a main reason for health and safety programmes. For hiring, training andpay, the difference that competitiveness of the environment makes is much more limited.Significant associations were found only for ability to get along well with others, fit withthe company’s values and ways of doing things and future co-workers’ opinions as hiringcriteria (n ¼ 3; 38 per cent); initial training for new employees and helping employeesunderstand the business as a purpose of training (n ¼ 2; 20 per cent); and the futuristic

Table 1 (Continued)

Practice Not

at all

Small

extent

Moderate

extent

Large

extent

Very

great

extent

Lack of top management

support as significant barrier

27.0 29.6 23.3 13.8 6.3

Legal compliance as main

reason for programmes

7.5 17.4 36.0 24.8 14.3

Regular conduct of

worksite inspections

19.9 25.5 23.0 24.2 7.5


orientation of the pay system (n ¼ 1; 11 per cent). Overall, perceived competitiveness ofthe business environment accounted for differences in twenty-one practices (44 per cent).

Employment size accounted for differences in six of the training practices (60 percent), but only a few in the other functions (two practices in performance appraisal andone pay practice). Unionization, industry, product diversity and organizational life cycleaccounted for only a few differences in total (n ¼ 4 or 8 per cent; 7 or 15 per cent; 2 or 4per cent; and 1 or 2 per cent, respectively), while foreign ownership was not significantlyassociated with any practice across all functions.

Organizational outcomes

Correlations between HRM practices and organizational outcomes were computed.Table 3 shows the correlation coefficients (r) between each of the listed HRM practicesand perceived organizational performance and voluntary turnover rate.

All five functional areas were associated with perceived organizational performance(a total of forty-two practices, or 88 per cent). All listed purposes in trainingand performance appraisal were significantly correlated with perceived organizationalperformance. In pay, only ‘seniority does not enter into pay decisions’ was notsignificantly correlated. Likewise, only one listed occupational health and safety practicewas not significant (legal compliance as the main reason for health and safetyprogrammes); and lack of top management support as a significant barrier was in thenegative direction. In hiring, three of the criteria listed were significant and in the positivedirection: ability to perform the technical requirements of the job, fit with company’svalues and ways of doing things, and belief that the person will stay with the company(five years or longer). Having the right connections (school, family, friends, region,government, etc.) was also significantly correlated but in the negative direction.

None of the health and safety practices were significantly related to voluntary turnoverrate, but the number of significant correlations in the other functional areas was very low(a total of 11 practices, or 23 per cent).

Comparison with US and Canada

In summary, HRM practices that are commonly found or prescribed in Westernmanagement can also be found in the Philippines. This should not come as a surprise tothose familiar with the country, as much of the management education is modelled on UStheory and practice. The results would, of course, be more meaningful with somecomparative data, particularly with Western countries. Table 4 shows the means for thePhilippines, US and Canada (the Canadian and US surveys did not include health andsafety practices). Analysis of variance with post hoc comparison was conducted for eachHRM practice to determine whether means differed significantly across the threecountries, and which country differed significantly. As the bold and italic text in the tableindicate, there is much similarity between the US and Canada, which is expected, giventheir geographical proximity, closer economic relations, cultural affinities andsimilar economic systems. What is surprising is that the means of most of the practicesfor the Philippines are significantly higher than either the US or Canada, or both.Although there was not an explicit hypothesis as to directions, one would have expectedthat, HRM being a creation of Western management, the Philippines would have hadlower levels of such practices.

Nonetheless, there were strong similarities across the three countries. In terms ofmeans, four were in the top five most prevalent practices in all three countries: the hiringcriterion of ability to perform the technical job requirements (this practice also had the


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sso

cia

ted

pra

ctic

es2

(5.3

%)

5(1

3.2

%)

1(2

.6%

)

Lif

ecy

cle

Hir

ing

(no

ne)

Tra

inin

gB

uil

dte

amw

ork

wit

hin

com

pan

yt¼

5:8

5*

Ap

pra

isal

Det

erm

ine

app

rop

riat

ep

ayt¼

22:0

0*

Pay

Fu

turi

stic

ori

enta

tio

no

fp

aysy

stem

t¼

4:5

7*

No

.o

fsi

gn

ifica

ntl

ya

sso

cia

ted

pra

ctic

es1

(2.6

%)

2(5

.3%

)0

Bu

sin

ess

com

pet

itio

nH

irin

gA

bil

ity

tog

etal

on

gw

ell

wit

ho

ther

sr¼

0:1

9*


Ta

ble

2a

(Co

nti

nu

ed)

HR

Mfu

nct

ion

Ph

ils.

ðN¼

16

8Þ

U.S

.

ðN¼

14

5Þ

Ca

na

da

ðN¼

12

6Þ

Po

ten

tial

tod

oa

go

od

job

r¼

0:1

8*

r¼

0:2

7*

*

Fit

wit

hco

mp

any

’sv

alu

esan

dw

ays

r¼

0:2

8*

r¼

0:3

1*

*

Fu

ture

co-w

ork

ers’

op

inio

ns

r¼

0:2

5*

*

Pro

vid

ere

war

dto

emp

loy

ees

r¼

0:1

9*

Imp

rov

ete

chn

ical

job

abil

itie

sr¼

0:4

5*

*r¼

0:4

5*

*r¼

0:2

4*

*

Imp

rov

ein

terp

erso

nal

abil

itie

sr¼

0:4

2*

*r¼

0:2

4*

*r¼

0:4

1*

*

Rem

edy

pas

tp

oo

rp

erfo

rman

cer¼

0:4

4*

*r¼

0:2

6*

*r¼

0:2

5*

*

Tra

inin

gP

rep

are

emp

loy

ees

for

futu

re

job

assi

gn

men

ts

r¼

0:4

8*

*r¼

0:3

5*

*r¼

0:4

3*

*

Bu

ild

team

wo

rkw

ith

inco

mp

any

r¼

0:5

5*

*r¼

0:3

7*

*r¼

0:5

3*

*

Init

ial

trai

nin

gfo

rn

ewem

plo

yee

sr¼

0:4

9*

*r¼

0:2

2*

r¼

0:2

1*

Hel

pem

plo

yee

su

nd

erst

and

the

bu

sin

ess

r¼

0:4

1*

*r¼

0:3

6*

*r¼

0:3

5*

*

Pro

vid

esk

ills

for

an

um

ber

of

dif

fere

nt

job

s

r¼

0:4

3*

*r¼

0:3

6*

*r¼

0:3

7*

*

Tea

chem

plo

yee

sab

ou

t

com

pan

y’s

val

ues

r¼

0:5

6*

*r¼

0:1

9*

r¼

0:3

1*

*

Det

erm

ine

app

rop

riat

ep

ayr¼

0:3

6*

*

Do

cum

ent

sub

ord

inat

e’s

per

form

ance

r¼

0:4

2*

*r¼

0:2

5*

*

Ap

pra

isal

Pla

nd

evel

op

men

tac

tiv

itie

sr¼

0:4

7*

*r¼

0:3

4*

*r¼

0:3

3*

*

Sal

ary

adm

inis

trat

ion

r¼

0:3

9*

*

Rec

og

nit

ion

for

thin

gs

do

ne

wel

lr¼

0:3

9*

*r¼

0:3

0*

*r¼

0:2

3*

Lay

ou

tsp

ecifi

cw

ays

toim

pro

ve

per

form

ance

r¼

0:4

6*

*r¼

0:2

6*

*r¼

0:2

7*

*

Dis

cuss

sub

ord

inat

e’s

vie

ws

r¼

0:4

4*

*r¼

0:2

5*

*

Ev

alu

ate

sub

ord

inat

e’s

go

alac

hie

vem

ent

r¼

0:4

6*

*r¼

0:2

1*

r¼

0:3

2*

*

Iden

tify

sub

ord

inat

e’s

stre

ng

ths

and

wea

kn

esse

s

r¼

0:5

1*

*r¼

0:2

9*

*


Ta

ble

2a

(Co

nti

nu

ed)

HR

Mfu

nct

ion

Ph

ils.

ðN¼

16

8Þ

U.S

.

ðN¼

14

5Þ

Ca

na

da

ðN¼

12

6Þ

All

ow

sub

ord

inat

eto

exp

ress

feel

ing

s

r¼

0:4

2*

*r¼

0:3

1*

*

Det

erm

ine

sub

ord

inat

e’s

pro

mo

tab

ilit

y

r¼

0:3

8*

*r¼

0:2

7*

*r¼

0:2

9*

*

Ince

nti

ves

asim

po

rtan

tp

art

in

pay

stra

teg

y

r¼

0:2

0*

*r¼

0:2

5*

*

Ben

efits

asim

po

rtan

tp

art

of

tota

l

pay

pac

kag

e

r¼

0:3

8*

*r¼

0:2

4*

Po

rtio

no

fea

rnin

gs

con

tin

gen

to

n

gro

up

per

form

ance

r¼

0:2

7*

*r¼

0:2

3*

r¼

0:2

5*

*

Lo

ng

-ter

mre

sult

sm

ore

imp

ort

ant

r¼

0:3

7*

*r¼

0:2

9*

*r¼

0:2

8*

*

Pay

Sen

iori

tyd

oes

no

ten

ter

into

pay

dec

isio

ns

r¼

20:2

3*

Ince

nti

ves

sig

nifi

can

tp

ort

ion

of

tota

lea

rnin

gs

r¼

0:2

2*

*

Ver

yg

ener

ou

sem

plo

yee

ben

efits

pac

kag

eR¼

0:3

3*

*

Fu

turi

stic

ori

enta

tio

no

fp

aysy

stem

r¼

0:3

7*

*r¼

0:2

7*

*r¼

0:2

0*

Job

per

form

ance

mai

nly

det

erm

ined

pay

rais

es

r¼

0:3

8*

*r¼

0:2

9*

*r¼

0:3

8*

*

No

.o

fsi

gn

ifica

ntl

ya

sso

cia

ted

pra

ctic

es3

4(8

9.5

%)

25

(65

.8%

)2

8(7

3.7

%)

***

p,

.001.

**

p,

.01.

*p,

.05.


highest mean for all three countries); proven work experience in similar job; training to

improve technical job abilities, and benefits as an important part of the total pay package.

Only one practice in the bottom five, or least prevalent practice, was shared by all three

countries: futuristic orientation of the pay system.As with the Philippine sample, the status of the HRM department of the US and

Canadian samples correlated with greatest number of practices (34 or 89.5 per cent out of

38 practices, 25 or 65.8 per cent, 30 or 78.9 per cent for the Philippines, the US and

Canada respectively), in comparison to all the other organizational characteristics

(see Table 2a). Comparing the three countries, however, there were fewer practices that

were significantly correlated across all organizational characteristics for the US and

Canadian samples. The average percentage of practices that correlated significantly with

the organizational characteristics other than status of HRM department was 9.7 per cent

Table 2b Health and safety (HS) practices significantly associated with organizational

characteristics for the Philippines

Employment size

(none)

Unionization

Existing HS programme is very cost effective t ¼ 2:70**

Very proactive HS programmes t ¼ 2:36*

Active promotion of HS programmes t ¼ 2:07*

Industry

Very proactive HS programmes F ¼ 2:79*

Active promotion of HS programmes F ¼ 2:66*

Product diversity

(none)

Life cycle

Very proactive HS programs t ¼ 2:04*

Objectives clearly understood by employees t ¼ 2:52*

Foreign ownership

(none)

Status of the HRM department

HS is considered top priority r ¼ 0:27**

HS management as a strategic concern r ¼ 0:35**

Existing HS programme is very cost effective r ¼ 0:24**

Very proactive HS programmes r ¼ 0:35**

Objectives clearly understood by employees r ¼ 0:34**

Active promotion of HS programmes r ¼ 0:40**

Safety as individual’s principal responsibility r ¼ 0:37**

Regular conduct of worksite inspections r ¼ 0:23**

Business competition

HS is considered top priority r ¼ 0:21*

HS management as a strategic concern r ¼ 0:19*

Very proactive HS programmes r ¼ 0:26**

Objectives clearly understood by employees r ¼ 0:21*

Active promotion of HS programmes r ¼ 0:25**

Safety as individual’s principal responsibility r ¼ 0:27**

Regular conduct of worksite inspections r ¼ 0:18*

**p , .01.

*p , .05.


Ta

ble

3H

RM

pra

ctic

essi

gn

ifica

ntl

yco

rrel

ate

dw

ith

org

an

iza

tio

na

lo

utc

om

es(r

)

HR

Mfu

nct

ion

Ph

ilip

pin

es

ðN¼

16

8Þ

US

ðN¼

14

5Þ

Ca

na

da

ðN¼

12

6Þ

Vo

lun

tary

turn

ove

r

Org

an

iza

tio

na

l

per

form

an

ce

Org

an

iza

tio

na

l

per

form

an

ce

Org

an

iza

tio

na

l

per

form

an

ce

Hir

ing

Ab

ilit

yto

per

form

tech

nic

aljo

bre

qu

irem

ents

20

.22

*0

.37

*0

.24

*

Ab

ilit

yto

get

alo

ng

wel

lw

ith

oth

ers

0.3

0*

*0

.23

*

Rig

ht

con

nec

tio

ns

20

.17

*2

0.2

4*

Bel

ief

that

per

son

wil

lst

ayw

ith

com

pan

y0

.16

*

Po

ten

tial

tod

oa

go

od

job

0.2

8*

*

Fit

wit

hco

mp

any

’sv

alu

es&

way

s0

.27

**

0.3

1*

*

Fu

ture

co-w

ork

ers’

op

inio

ns

0.3

1*

*0

.19

*

Pro

vid

ere

war

dto

emp

loy

ees

0.2

2*

*0

.21

*

Imp

rov

ete

chn

ical

job

abil

itie

s2

0.2

5*

0.3

2*

*0

.26

**

Imp

rov

ein

terp

erso

nal

abil

itie

s0

.27

**

0.3

0*

*0

.38

**

Rem

edy

pas

tp

oo

rp

erfo

rman

ce0

.31

**

Pre

par

eem

plo

yee

sfo

rfu

ture

job

assi

gn

men

ts0

.26

**

0.2

5*

0.3

7*

*

Tra

inin

gB

uil

dte

amw

ork

wit

hin

com

pan

y2

0.2

9*

*0

.37

**

0.3

4*

*0

.47

**

Init

ial

trai

nin

gfo

rn

ewem

plo

yee

s2

0.3

0*

*0

.42

**

0.2

5*

0.3

6*

*

Hel

pem

plo

yee

su

nd

erst

and

the

bu

sin

ess

20

.22

*0

.39

**

0.2

9*

*0

.40

**

Pro

vid

esk

ills

for

an

um

ber

of

dif

fere

nt

job

s0

.40

**

0.4

1*

*

Tea

chem

plo

yee

sab

ou

tco

mp

any

’sv

alu

es0

.49

**

0.3

1*

*0

.44

**

Det

erm

ine

app

rop

riat

ep

ay0

.31

**

Do

cum

ent

sub

ord

inat

e’s

per

form

ance

0.3

8*

*0

.25

*0

.33

**

Pla

nd

evel

op

men

tac

tiv

itie

s2

0.2

2*

0.4

9*

*0

.24

*0

.44

**

Sal

ary

adm

inis

trat

ion

20

.21

*0

.31

**

0.2

1*

Rec

og

nit

ion

for

thin

gs

do

ne

wel

l2

0.2

3*

0.3

7*

*0

.26

*0

.52

**

Lay

ou

tsp

ecifi

cw

ays

toim

pro

ve

per

form

ance

0.4

4*

*0

.53

**

Dis

cuss

sub

ord

inat

e’s

vie

ws

0.4

2*

*0

.51

**

Ap

pra

isa

lE

val

uat

esu

bo

rdin

ate’

sg

oal

ach

iev

emen

t0

.45

**

0.3

3*

*0

.42

**

Iden

tify

sub

ord

inat

e’s

stre

ng

ths

&w

eak

nes

ses

20

.25

*0

.46

**

0.3

8*

*0

.48

**

All

ow

sub

ord

inat

eto

exp

ress

feel

ing

s0

.39

**

0.5

1*

*


Ta

ble

3(C

on

tin

ued

)

HR

Mfu

nct

ion

Ph

ilip

pin

es

ðN¼

16

8Þ

US

ðN¼

14

5Þ

Ca

na

da

ðN¼

12

6Þ

Vo

lun

tary

turn

ove

r

Org

an

iza

tio

na

l

per

form

an

ce

Org

an

iza

tio

na

l

per

form

an

ce

Org

an

iza

tio

na

l

per

form

an

ce

Det

erm

ine

sub

ord

inat

e’s

pro

mo

tab

ilit

y0

.37

**

0.5

0*

*

Ince

nti

ves

asim

po

rtan

tp

art

inp

ayst

rate

gy

0.2

7*

*0

.39

**

Ben

efits

asim

po

rtan

tp

art

of

tota

lp

ayp

ack

age

20

.22

*0

.37

**

0.3

8*

*

Po

rtio

no

fea

rnin

gs

con

tin

gen

to

ng

rpp

erfo

rman

ce0

.33

**

0.3

4*

*

Lo

ng

-ter

mre

sult

sm

ore

imp

ort

ant

0.4

5*

*0

.37

**

0.4

5*

*

Ince

nti

ves

sig

nifi

can

tp

ort

ion

of

tota

lea

rnin

gs

0.2

6*

*0

.38

**

Ver

yg

ener

ou

sem

plo

yee

ben

efits

pac

kag

e0

.44

**

Pa

yF

utu

rist

ico

rien

tati

on

of

pay

syst

em2

0.2

0*

0.4

8*

*0

.23

*0

.38

*

Job

per

form

ance

mai

nly

det

erm

ined

pay

rais

es0

.38

**

0.3

7*

*

HS

isco

nsi

der

edto

pp

rio

rity

0.4

8*

*

HS

man

agem

ent

isa

stra

teg

icco

nce

rn0

.48

**

Ex

isti

ng

HS

pro

gra

mis

ver

yco

stef

fect

ive

0.3

7*

*

Ver

yp

roac

tiv

eH

Rp

rog

ram

s0

.49

**

Hea

lth

&S

afe

tyO

bje

ctiv

escl

earl

yu

nd

erst

oo

db

yem

plo

yee

s0

.44

**

Act

ive

pro

mo

tio

no

fH

Sp

rog

ram

s0

.52

**

Saf

ety

asin

div

idu

al’s

pri

nci

pal

resp

on

sib

ilit

y0

.45

**

Leg

alco

mp

lian

ceas

mai

nre

aso

nfo

rp

rog

ram

s2

0.2

2*

*

Reg

ula

rco

nd

uct

of

wo

rksi

tein

spec

tio

ns

0.3

6*

*

Note

s

***

p,

.001.

**

p,

.01.

*p,

.05.

The

US

and

Can

adia

nsu

rvey

sdid

not

incl

ude

ques

tions

on

hea

lth

and

safe

typra

ctic

esan

dvolu

nta

rytu

rnover

rate

.


Table 4 Means of HRM practices in the Philippines, US and Canada

Practice Philippines

ðN ¼ 168Þ

U.S.

ðN ¼ 145Þ

Canada

ðN ¼ 126Þ

Hiring criteria

Ability to perform technical

job requirements

4.10 3.98 4.08

Ability to get along well

with others

3.45 3.45 3.44

Right connections*** 2.61 2.66 2.06

Belief that person will stay

with company***

3.29 2.76 3.06

Proven work experience in

similar job**

4.01 3.68 3.82

Potential to do a good job*** 3.44 2.97 3.10Fit with company’s values & ways 3.64 3.44 3.58

Future co-workers’ opinions** 2.19 2.42 1.94

Training purposes

Provide reward to employees** 2.77 2.39 2.45Improve technical job abilities 3.69 3.67 3.85

Improve interpersonal abilities** 3.40 2.99 3.19

Remedy past poor performance*** 3.17 2.54 2.68Prepare employees for future

job assignments***

3.40 2.74 3.00

Build teamwork within company*** 3.50 2.84 3.02Initial training for new employees*** 3.10 2.54 2.56Help employees understand

the business***

3.07 2.46 2.69

Provide skills for a number of

different jobs***

3.15 2.36 2.62

Teach employees about

company’s values***

3.34 2.64 2.76

Appraisal purposes

Determine appropriate pay 3.12 3.14 3.22

Document subordinate’s

performance**

3.71 3.56 3.33

Plan development activities** 3.21 2.73 2.98

Salary administration 3.26 3.22 3.11

Recognition for things done well 3.52 3.31 3.27

Lay out specific ways to

improve performance*

3.38 3.07 3.23

Discuss subordinate’s views 3.07 2.91 3.19

Evaluate subordinate’s goal achievement 3.27 3.15 3.25

Identify subordinate’s strengths &

weaknesses

3.53 3.35 3.27

Allow subordinates to express

feelings

3.08 2.83 2.98

Determine subordinate’s

promotability***

3.55 2.69 2.92

Pay

Incentives as important part in

pay strategy***

3.31 2.77 2.86

Benefits as important part of total

pay package

3.87 3.72 3.78


for the US (ranging from 2.6 per cent of all practices for unionization to 18.4 percent for employment size) and 4 per cent for Canada (ranging from 0 forunionization, industry type and organizational life cycle to 15.8 per cent forperceived competitiveness of the business environment). For the Philippines, theaverage was 14.5 per cent, ranging from 2.6 per cent for unionization andorganizational life cycle to 39.5 per cent for perceived competitiveness of thebusiness environment. Apart from these differences in the number of significantcorrelations, the US and Canadian samples also show negative correlations. In theUS sample, all four practices significantly correlated with perceived competitive-ness are in the negative direction, and the correlation of seniority entering into paydecisions with status of the HRM department is negative. Both US and Canadiansamples show negative correlations between the use of right connections as ahiring criterion and status of the HRM department.

In terms of correlations with organizational performance (see Table 3), thePhilippine sample has the highest percentage of practices that correlated withorganizational performance at 86.8 per cent (ranging from 50 per cent for hiring to100 per cent for training and performance appraisal), followed closely by Canada at78.9 per cent (ranging from 62.5 per cent for hiring to 90.9 per cent for performanceappraisal) and a distinct third is the US with 44.7 per cent (ranging from 33.3 percent for hiring and pay to 60 per cent for training). Across all three countries, thefunctional area with the highest number of practices correlating with organizationalperformance was training: the Philippines at 100 per cent, Canada at 90 per cent andthe US at 60 per cent. Only one practice (use of right connections as a hiringcriterion) was negatively correlated with perceived organizational performance, andthis was in both Philippine and Canadian samples, while the correlation in the USsample was not significant.

Table 4 (Continued)

Practice Philippines

ðN ¼ 168Þ

U.S.

ðN ¼ 145Þ

Canada

ðN ¼ 126Þ

Portion of earnings contingent on

group performance***

2.99 2.46 2.52

Long-term results more important*** 2.96 2.01 2.41

Seniority does not enter into

pay decisions*

2.90 2.96 2.61

Incentives significant portion of

total earnings***

2.93 2.20 2.15

Very generous employee benefits

package

3.18 3.16 3.19

Futuristic orientation of pay system*** 2.64 1.74 2.02Job performance mainly determines

pay raises***

3.29 2.42 2.58

***p , .001.

**p , .01.

*p , .05.

Values in bold are not significantly different.

Values in italics are significantly different.


Discussion

While the primary impetus of the Best Practices consortium was to provide comparativedata of rich descriptions, an understanding of the factors that drive differences orsimilarities is necessary in generalizing and developing a theoretical framework. Thecomparative data for the three countries illustrate differences and similarities, and, whileno expectations or predictions were made a priori, an attempt is made to explore possibleexplanations. Such explorations serve to focus future research in order to advance ourunderstanding, although they may not provide definitive explanations in the current case.Three possible sources might explain the observed differences and similarities: countrycontext, organizational factors or sample differences, and methodological artefacts.While the primary interest in cross-cultural comparisons is differences in countrycontext, one must ensure that alternative explanations because of sample differences ormethodological artefacts can be ruled out.

Differences in country context

Earlier it was pointed out that differences are not surprising considering that the US andCanada are similar in a lot of respects, while the Philippines was not. What needs to beexplored is the reason why the Philippines turned out to have higher means. Particularlynoticeable in Table 4 is the number of significant differences in the area of trainingbetween the Philippines, on the one hand, and the US and Canada, on the other. Beingadvanced industrialized countries, the US and Canada might already have better trainedemployees in the external labour market, so that it becomes less important for firms toprovide training. Aside from that, the Philippines is still in the catch-up phase, and so willimplement what they see as the practices that help, or have helped, these two countriesprogress or advance. Given the access to information about management practices andthe fact that management education has largely been based on US theories, this then islikely to explain the higher means observed in the Philippine sample. The diffusion ofmanagement knowledge is supported by similarities in the top five most prevalentpractices in all three samples, but the non-similarity in the bottom five, or least prevalent,practices suggests that this diffusion is not complete and is not without influence fromother factors.

The influence of country context may be examined, not just in the levels of HRMpractices, but also in the interrelationships among the variables, both in terms of thenumber and direction of significant correlations. There do not seem to be any countrydifferences in how the status of the HRM department and unionization compare withother organizational determinants in influencing the firm’s HRM practices. Across allthree countries, the status of the HRM department, with the highest number of significantcorrelations, is the most influential and its influence generally is in the positive direction,while unionization, with the least number, does not seem to have a consistent effect onorganizations across the three countries.

Observed differences in the direction of correlations across the three countries mayreflect differences in the underlying cultural values or beliefs. The negative direction forall significant correlations for perceived competitiveness in the US sample, compared tothe positive and non-significant correlations for the Philippines and Canada respectively,may indicate a different understanding or belief with respect to what it takes for firms torespond effectively to the competitiveness in the business environment. The negativecorrelation of use of right connections as a hiring criterion with the status of the HRMdepartment in the US and Canadian samples is as expected, while the observed non-significance for the Philippine sample may indicate that cultural expectations are still


driving some of the decisions of some HRM departments. However, as this practice isone of the five least prevalent in the Philippines and is negatively correlated withperceived organizational performance, this may mean that some Western influence isbeginning to take place. Thus, while HRM departments in the Philippines may feel thatthis practice should no longer be used, based on what they know from best practices inthe West, expectations from other stakeholders in the organization influence some HRMdepartments to continue to implement this practice. The non-significant correlation ofthis practice with organizational performance in the US sample may indicate that thispractice is being used in some firms, even if not acknowledged as a best practice, and thatsome firms may benefit from it.

Differences in the organizational profiles of the country samples

It should be noted that the samples from the three countries differed significantly in termsof the status of the HRM department, industry sector, product diversity, organizationallife cycle and employment size (see Table 5). Only in perceived competitiveness of theenvironment, perceived organizational performance and unionization were the threesamples not significantly different.1 The status of the HRM department in the Philippineswas significantly higher than in the US and Canada, which did not differ significantlyfrom each other. Most of the US and Canadian responding firms were in themanufacturing sector (61 per cent and 44 per cent respectively, compared to32 per cent for the Philippines), and had more than 1,000 employees (80 per centand 62 per cent respectively, compared to 26 per cent of the Philippine sample). The USsample had the highest number of firms that had unrelated products and services (22 percent), with the Philippine and Canadian samples at only 5 per cent and 6 per centrespectively. Voluntary turnover rate was not measured for the US and Canadian samples.

One probable explanation of the higher means in the Philippine sample is the higherstatus of the HRM department in the Philippines, particularly when this organizationalvariable also correlated with the most HRM practices in comparison to the US andCanada. Gooderham et al. (1999) argued and found that the institutional environment,which is reflected to the differences in the role, status and position of the personnelfunction within the firm, is a particularly salient consideration in comparative studies,explaining variations in HRM practices in different countries.

There are other organizational characteristics in which the three country samplesdiffer, although the effect on HRM practices is unclear because of the inconsistency withwhat might logically be expected. For instance, large organization size is usuallyassociated with more practices, but there are more large organizations, in terms ofemployment size, in the Canadian and US samples. There are more organizations in theservices sector in the Philippine sample, and it could be argued that the services sector,like banking and financial institutions and consulting firms, is more likely to have thekinds of HRM practices covered by the survey than an older industry like manufacturing.However, the difference in terms of organizational life cycle, where there were moreorganizations that considered themselves mature in all three samples, seems to contradictthis explanation.

According to Aycan et al. (1999), the effects of significant differences in thecharacteristics of samples can be minimized statistically by co-varying them out.Removing the effect of the status of the HRM department, the variable that significantlycorrelated with the most number of practices, would show whether the observeddifferences in HRM practices across the three countries (see Table 4) can be attributed tothis organizational characteristic, rather than differences in other respects. In order


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to remove the effect of the status of the HRM department, an analysis of covariance(ANCOVA) was conducted with HRM department status included as a covariate. Whilethe samples from the three countries also varied significantly in other organizationalcharacteristics, these characteristics were not associated with as many HRM practices asHRM department status. Nonetheless, in order to further assess their effect, these othercharacteristics, namely employment size, product diversity, industry type andorganizational life cycle, were also included in the analysis as main factors, as well assecond-order interaction terms with country.

As suspected, status of the HRM department was a significant covariate, and removingits effect then reduced the number of HRM practices where country had an effect(whether as main effect or interaction effect with other organizational characteristics) tojust eight: proven work experience in similar job as a hiring criterion; performanceappraisal to document subordinates’ performance; training to remedy past poorperformance, to build teamwork within the company, to help employees understand thebusiness, to provide skills for a number of different jobs, to teach employees aboutcompany’s values, and as initial training for new employees. Note that six of thesepractices are with respect to training, supporting one of the earlier interpretations ofcountry context. The only practice where status of the HRM department was not asignificant covariate is that of future co-workers’ opinions as hiring criterion, withorganizational life cycle as the only significant factor.

Organizational characteristics, particularly the status enjoyed by the HRMdepartment, thus have an effect, and perhaps an even stronger influence onHRM practices than external factors, but which HRM practices depends on whichorganizational characteristics. Researchers, therefore, need to be careful when doingcomparative studies. Samples with similar organizational characteristics should beselected, or organizational characteristics that are likely to affect HRM must be measuredso that their effects can be parsed out statistically, if the ‘true’ effect of country context isto be established.

Methodological artefacts

Perhaps the biggest concern in ensuring valid conclusions from cross-cultural studies isthat of equivalence: whether the finding is a ‘true’ cross-cultural difference or an artefactof the research methodology beyond that of non-comparable samples. Hui and Triandis(1985), Mullen (1995) and Singh (1995) discuss the various equivalence problems incross-cultural research and suggest several strategies aimed at the research design,diagnosing data or adjusting statistical analyses. Cross-cultural equivalence, specificallyin terms of conceptual or functional equivalence, equivalence in operationalization andinstrument equivalence, needs to be established so that direct, especially quantitative,comparisons are justified.

The various strategies that have been suggested have their respective limitationsas well as advantages. There is also a difference in opinion on the use of these strategies.Singh (1995) considers the assessment or diagnosis of data provides evidence of themore abstract aspects of equivalence. For Hui and Triandis (1985), demonstratinginstrument equivalence does not necessarily mean that conceptual or functionalequivalence can be assumed, as these aspects of equivalence are seen to be progressive,from the more concrete to the higher, more abstract. Accepting or testing at a certainlevel is meaningful only when all higher levels have been shown. Thus, since somestrategies address only one or some aspects of equivalence, using a combination ofdifferent strategies is highly advisable.


The problems that threaten valid cross-cultural comparisons will be discussed withinthe context of the current research. The first two aspects of conceptual or functional andoperationalization equivalence have been addressed to a large extent. The idea of aconsortium of international researchers allows the use of researchers who have anunderstanding of at least two cultures, one of which includes the culture of origin ofthe study. However, in future research, these aspects of equivalence canbe further strengthened by confirming the individual researcher’s understanding orinterpretation with other cultural insiders, at the stage of research design, and also at thestage of interpreting the findings.

Instrument equivalence involves item equivalence and scalar or metric equivalence.Item equivalence is usually addressed prior to data collection by translation, atminimum a technique called back-translation. In the case of the Philippines,no translation was needed since the target population of the survey is bilingual.While translation was deemed unnecessary, a review of studies on bilingualswould help in addressing language concerns.

Bennett (1977) studied the response characteristics of Filipino bilinguals.Using a questionnaire that measured perceptions of organizational characteristics, therespondents who answered in the native language had more positive responses than thosewho responded to the English version of the same questionnaire. The explanationsuggested was the use of a different reference group depending on the language ofpresentation: the English response group used as their reference group the Europeans atthe top of the organization, categorising them unfavourably, while those using the nativelanguage saw the items as relating to them as managers, and therefore answered morepositively. If the results of Bennett’s study were applied to the current one, then the use ofthe English language would likely not have resulted in higher means for the use of theHRM practices.

Another study of bilinguals, this time Spanish/English, showed an opposite effect(Marin et al., 1983). In this case, responding in English was influenced by socialdesirability, although Marin et al. also cautioned the reader about generalizing to allbilinguals. Another difference is that the respondents were asked to answer aquestionnaire in both languages at different times, rather than have different groups, onewho responded in the native language and one in the English language, as in Bennett’sstudy with Filipino bilinguals. What perhaps can be generalized to bilinguals is Bond andYang’s (1982) suggestion that the response in English (as the second language), eitherdemonstrating ethnic affirmation or cross-cultural accommodation, depends on how ego-involving the item is. In addition, there is Candell and Hulin’s (1987) observation thatbilinguals make allowances for poor translation because of their knowledge of bothlanguages. In any case, these existing studies do not provide sufficient evidence yet ofhow bilingualism in the Philippine sample in this study affected the results observed.Is ethnic affirmation or cross-cultural accommodation at work in this case?

The above discussion addresses translation equivalence, but the question of scalarequivalence of the instrument still needs to be explored. Scalar or metric equivalence isparticularly relevant in using Likert-type scales, or what Mullen (1995) calls soft variables.Hard variables, such as unionization or voluntary turnover in this study, are affected bycalibration equivalence, a special case of translation equivalence. Measurement errorspose threats to either the reliability or validity of the measures (Mullen, 1995). Threats tovalidity in a cross-cultural context often refer to response set bias that results in systematicerror. The effect of language and culture on response patterns, however, may be differentfor the specific language or culture under consideration (Hui and Triandis, 1989); hence,only those studies involving Filipino subjects are considered here. A common cultural


difference in response patterns is in the utilization of the midpoint versus the extreme endsof a scale. In Stening and Everett’s (1984) study of the effect of nationality on responsestyles of expatriate and local managers from nine countries, the Filipinos showed atendency to use more of the extreme ends of the semantic differential scale, while theAmericans used the midpoint more.

A possible explanation of response styles attributable to cultural differences comesfrom Aycan et al.: the likelihood of ‘social desirability response bias of respondentswhen they act as participants rather than as observers. The bias could be greater in somecultural contexts (e.g., collectivism) where participants might have a tendency to try toplease the researcher, depending on the context and their relationship’ (1999: 508–9).In Hofstede and Bond’s (1988) data, the Philippines ranks 31 out of 53 in the culturaldimension of individualism, while the US ranks the highest, with Canada not far behind,ranking 4–5. Analysing the response pattern of the current samples, the Philippine groupdiffered significantly from the US sample in terms of the use of the midpoint but in theopposite direction to that found by Stening and Everett (1984): the Philippine sampletended to use more of the midpoint ‘3’ response than the US sample. The Philippinegroup also differed from both the US and Canadian samples in terms of the use ofextreme responses, with the Philippine sample tending to use less of ‘1’ and more of ‘5’,thus supporting the social desirability effect. Stening and Everett (1984) observed theequal use of both extreme ends of the scale, but it should be noted that their study used asemantic differential scale rather than a Likert-type scale.

In summary, it is difficult to make definitive statements as to how linguistic andcultural influences on response patterns could have affected the results observed in thisstudy, because of the paucity of studies and their conflicting findings that may be partlydue to the different methodologies used. What is needed is to be cautious and take theseinto consideration when designing future studies so that the effects can then be tested.

Threats to reliability arise from random or non-systematic errors from inconsistentscoring due primarily to non-familiarity with the scoring methods or the research methods(Mullen, 1995). Such random errors are reflected in the reliability coefficients ofinstruments consisting of more than one item. If there are differences in the reliabilityof instruments across the different cultural groups, Singh (1995) suggests an adjustmentfactor so that valid inferences can be made from the correlations between theseinstruments. While there are several scales to which this concern of measurement errorpertains, these were used to correlate with each of the HRM practices, and not with a scaleof these practices. The formula for adjustment that Singh suggested cannot be applied.

There are other strategies that have been suggested to assess equivalence, once datahave been collected. The primary reasons for not using these in the current study,although relevant, are, particularly with respect to multi-item measures, the requirementof a large number of items and subjects from different cultures that the current study doesnot have (Hui and Triandis, 1985); availability of appropriate computer software, forinstance, in the item response approach suggested by Hui and Triandis (1985); or accessto the recommended software programs such as Multiple Group LISREL and OptimalScaling PRINCIPALS, which Mullen (1995) recommends rather than somecombinations of analysing internal structure.

Other methodological limitations That the management practices included in thequestionnaire are considered as the ideal may have affected the response rate, thuscontributing to bias in the results. That is, only those where most of these practicesapplied responded to the survey request. However, this limitation is a possibleexplanation for the observed country differences only to the extent that all three countries


are affected differentially. Otherwise, the only caution that needs to be made is whetherthe results for each country would be representative of the organizations in that country.Common method variance could partially explain the strength and numerous significantassociations between status of HRM department and HRM practices. However,this argument may be countered by the fact that the competitiveness scale did not yield asmany significant correlations with HRM practices in any of the three countries.

In summary, results suggest that many of the HRM practices developed in theWest are easily transferred to another country with a different culture and traditions,and different economic, legal and political systems, but that some uniqueness is stillretained that may also be in response to different country conditions as well asorganizational characteristics. Among these organizational characteristics, practices aremore likely to transfer where the HRM department enjoys a high status, overriding countrydifferences, and thus may lead to more convergence in HRM practices at the firm level.Nonetheless, since methodological artefacts cannot be completely ruled out at this time,these conclusions need to be taken with some caution, until future research canresolve these issues.

Future research

Country differences in HRM practices at the firm level can be attributed to organizationallevel characteristics and/or country-level differences in the legal, economic, political andsocial environment. To zero in on which factor, the ideal way is to select samples that aresimilar in factors that are not of interest in the study. A more practical way is measuringalong these extraneous factors so that their effects can be controlled in the statisticalanalyses. However, the challenge, as Gooderham et al. (1999) have pointed out, is todevelop appropriate measures of the country context variable, either as a global index orbroken down into its various dimensions. Access to the appropriate countries thatrepresent a wide range of the values of the relevant variables is also a challenge. It is alsoimportant to segregate firms in the sample in terms of their country of origin in order todetermine indigenous vs. foreign influences in firm practices (Teagarden and VonGlinow, 1997).

The instrument used in this study was constructed based on a model of HRM found inthe US. While this imposed etic (universal across cultures) approach makes sense ifaddressing the question of transferability, an emic (unique to a culture) approach tostudying HRM may shed light not only on practices that are uniquely found in a specificcountry but also those that are more salient for organizational success in that particularenvironment (Berry, 1989). An emic approach also ensures cross-cultural equivalence atthe higher, more abstract levels (Hui and Triandis, 1985). The limitation of a purely emicapproach is that it is difficult to make comparisons across different cultures, but that isusually resolved with a derived etic based on information from an emic stage.Furthermore, as Teagarden and Von Glinow (1997) suggest, it may very well be that,when in comes to HRM, it is the practices that are emic but the design philosophy behindsuch practices is etic.

The previous discussions pointed to several other suggestions that can be made interms of improving research methodology so as to rule out methodological artefacts asalternative explanations to cross-cultural findings. In addition to the studies of responsestyle bias due to cultural differences, another that may be useful to consider in the futureis that of Hui and Triandis (1989), who found that those with a stronger tendency towardsextreme response styles like Hispanics will have more responses in the extreme points ofa 5-point scale, but not with a 10-point scale.


Finally, the impact on other organizational outcomes, particularly in terms of financialperformance, is of importance. Studies in the US have shown positive relationshipsbetween firm financial performance and HRM practices (Becker and Gerhart, 1996), anda crucial test of transferability of practices is whether there is similarity in impact.Nonetheless, even in the US, it is not quite clear yet whether organizational gains such asfinancial returns are in conflict with employee gains. Cultural differences would probablyshow in terms of the relationship between employee gains and organizational gains, asthis would reflect differences in cultural values.

Notes

1 Based on a paper presented at the Pan-Pacific Conference XVI, Fiji, 31 May 1999. The

Philippine survey was partially funded by the Centre for Asia-Pacific Initiatives (CAPI),

University of Victoria. Althea Rabe of the College of Business Administration, University of

the Philippines, assisted in survey distribution and data entry.

2 The ousting of Presidents Ferdinand Marcos in 1986 and Joseph Estrada in 2001, after four days

of relatively non-violent mass protests.

3 The Best Practices survey contains more than the variables considered in this study.

4 Internal reliability coefficients (a) for status of HRM department, perceived competitiveness of

the business environment and perceived organizational performance are as follows: for the US,

0.78, 0.69 and 0.83 respectively; for Canada, 0.78, 0.66 and 0.90 respectively.

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