Is the standardization of human resource practices perceived as fair across national cultures? The cases of China, Lithuania, and Norway

The purpose of this paper is to investigate perceptions of fairness of a standardized performance appraisal in a multinational enterprise. The paper looks at the first step in understanding fairness perceptions by examining whether national culture influences the view on standardization itself and by comparing China, Lithuania, and Norway.

An experiment using a scenario that outlined a performance appraisal tool in a multinational company is conducted. National culture and individual cultural values are the independent variables and the perception of fairness of the practice is the dependent variable. A sample of 80 management respondents from Lithuania, China, and Norway is taken.

The findings suggest that national culture influences perceptions of fairness of a standardized performance appraisal tool. Employees from countries undergoing profound economic and political change, that score low on the cultural dimension of self‐expression, tend to see the standardized tool as more fair than employees from a stable country high on self‐expression. Differences in fairness perception at the individual level are found, where respondents high on power distance had higher perceptions of fairness of a standardized tool. Both national and individual levels measures of culture affected perceptions.

The sample is small; however, the differences are strong and indicate that perceptions of fairness vary. The experimental design allows good control, although it can limit generalizability to the field.

Multinational companies must understand that before analysis and choice of specific human resource practices it is important that they are aware of national and individual cultural differences towards standardization itself. Cultural differences affect reactions not only to the specific human practice but also to the standardization. Companies can use dimensions such as power distance and the survival/self‐expression dimension to understand the response of their employees. Being aware of this challenge may lead multinationals to pursue more fine‐tuned ways of communicating and implementing a standardized practice.

Using experiments to understand the implementation of practices in multinational organizations it is identified that, before deciding whether a practice should be locally adapted or standardized, the first step is to find out how standardization itself is perceived.