Cultural control and multinationals: the case of privatized Jordanian companies

Abstract

This paper draws on the findings of two case studies to examine how two French multinationals used expatriates and training and development to introduce and support a process of cultural reform in companies that they had acquired under the Jordanian government's privatization programme. It notes that in both cases these mechanisms of cultural change had been extensively employed and that the overall purpose of the organizational reforms they were intended to support exhibited many similarities. For example, in each of the companies a central aim of the reforms being introduced was to make the acquired organizations more business- and target-orientated and, to this end, incorporated initiatives to improve appraisal and selection procedures, establish closer links between pay and performance and introduce more devolved and decentralized management structures. In addition, expatriates were being widely used to develop and implement desired reforms and training and development was being actively used to engender supportive attitudinal changes. More generally, it was noticeable that neither of the multinationals adopted a markedly different approach to the management of their Jordanian operations, notwithstanding that they were based in a developing country and were either only partially owned or operated under a management contract. At the same time, marked variations existed in terms of the extent to which these reforms were centrally determined and hence authored, variations that, in part, appeared to stem from product market differences. The authors consequently warn against assuming too close an association between the human resource strategies of multinationals and the national business systems in which they are based. In addition and more generally, they note that it is often difficult to draw a clear distinction between cultural change, on the one hand, and structural and policy reforms, on the other, since all of these reforms, arguably, had a 'cultural dimension'.