This master’s thesis examines the collaboration between human resource management (HRM) department in a subsidiary and HRM department at company’s headquarters. The focus is on the challenges that stem from their hierarchical relationship, as well as opportunities for improvement. The hierarchical dynamic is analyzed through the level of autonomy granted to the subsidiary’s HRM department, using the framework of ethnocentric, polycentric, and global management approaches. This relationship is further explored within the specific national context – particularly with regard to Slovenian labor norms, cultural practices, and the use of the official language. The research is based on the HRM departments of two subsidiaries belonging to two different multinational companies in the automotive industry. Interviews were conducted with both employees and managers. The findings show that most of the difficulties do not arise directly from the hierarchical structure, but rather from inefficient internal organization within the subsidiary HRM departments or from limited financial resources. The autonomy of the subsidiary HRM department is closely tied to how the central HRM department operates. In both companies, subsidiaries enjoy relatively high autonomy at the operational level (e.g., implementing HRM practices to achieve specific goals), but much less at the strategic level (e.g., setting overall strategy, annual goals, and budgets).
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