Reverse Diffusion

Posted in Human Resource Terms, Total Reads: 341
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Definition: Reverse Diffusion

Reverse diffusion is the phenomenon of accumulating the best out of any international subsidiary company & incorporating it into the structure of the parent company. The different types of reverse diffusion are Strict Reverse, Evolutionary and Transformational. Every organization in different nations have different methods of working upon any situation, which differs from that of the parent company to subsidiary.


Implications

1. The source & channels where the reverse diffusion occurs must be clearly defined, or they may be clearly identified.

Example, the regional branches of insurance have high attrition rate, & they take measures to control them. This could be extrapolated to situations in Head office where they could use this to control attrition of similar employees in a better manner

2. The practice of reverse diffusion must have originated, or is being implemented in any subsidiary of the parent company.

3. With advancement of globalization & better prospects in technology, it is not only that best practices will originate in the parent country.


Types of Reverse Diffusion

1. Strict Reverse Diffusion: It focuses on bringing in reverse diffusion in a strict manner in order to maintain competitive advantage for the parent organization.

2. Evolutionary Reverse Diffusion: Focusing on implementing changes which would help in making small changes in the parent organization. May be voluntary.

3. Transformational Reverse Diffusion: A process by which a huge change is expected in the parent company from the subsidiary.


Advantages:

1. It helps in accumulation of the best practices from the other subsidiary company & incorporating it for better performances.

2. Operational benefits of using the reverse diffusion could result in better revenues & improving efficiency.


Disadvantages

1. Often it is difficult to implement new practices in the face of cultural changes that are present in the parent company.

2. There may be a good amount of cost involved while training the personnel for the reverse diffusion process in that of the new organization.

3. Eroding Original Country features that may be present, thereby origan values may be modified.

 

Effects of Reverse Diffusion

1. Manager Relationships

2. Domestic Work Force

3. Arguments relating to various HR Practices

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