The Power of Prestige: Investigating Employees’ Commitment in Companies Acquired by Chinese Multinational Enterprises in Germany
Based on social identity theory, the study gives insights into Chinese companies’ reputation challenges and opportunities to employ a committed workforce through acquisitions in Germany. The article empirically investigates the influence of the perceived external prestige of the Chinese parent company (PEPp) and the perceived external prestige of the acquired German subsidiary (PEPs) on organizational commitment. Furthermore, the study analyzes the role of organizational tenure and employees’ hierarchical position in the aforementioned relationships. Employing data from 121 employees, the study shows that the two types of prestige influence employees’ commitment, with the PEPp playing a more dominant role than the PEPs. Moreover, the study contains implications for Chinese companies to overcome reputation challenges and to employ a committed workforce by properly addressing employees with regard to their organizational tenure and hierarchical position.
KeywordsChinese multinational enterprises Perceived external prestige Social identity theory Affective commitment
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