Digitally mediated HRM knowledge transfer and capability development for financial performance results in Central European multinational companies

Purpose The main goal of this article is to develop, validate and empirically test a model of digitally mediated human resources management (HRM) knowledge transfer effectiveness from HQs to foreign subsidiaries in multinational companies (MNCs), with particular attention to the role of transfer-related capabilities and transfer mechanisms in shaping HRM outcomes and financial performance results. This study also aims to demonstrate how the development of transfer-related capabilities at the HQs and subsidiary levels, together with digitally mediated transfer mechanisms, contributes to effective knowledge transfer and its subsequent HRM and financial outcomes in MNCs. Design/methodology/approach The empirical research used a quantitative approach, using survey data via computer-aided telephone interview from 100 MNCs and their 200 foreign subsidiaries. Partial least squares structural equation modeling (PLS-SEM) was applied to validate the proposed model. The study is conducted in the context of MNCs headquartered in Central Europe, a region characterized by the coexistence of diverse coordination logics and organizational legacies, which creates specific challenges for cross-border HRM knowledge transfer. Findings The findings confirm that HQ’s knowledge transfer capability, FS’s absorptive capacity and ICT-based mechanisms significantly shape knowledge transfer effectiveness, HRM outcomes and financial performance. The model shows high explanatory power (R2 = 0.80). The strongest effects occur between HRM knowledge transfer goals and effectiveness (β = 0.97–0.98), while cloud-based repositories and structured documentation exhibit the most substantial ICT effects, followed by effectiveness–HRM outcomes (β = 0.62) and HRM outcomes–financial performance (β = 0.57). Originality/value The study develops and empirically validates an integrated model of digitally mediated HRM knowledge transfer in MNCs, combining HQs’ transfer capabilities, subsidiaries’ absorptive capacities and ICT-based transfer mechanisms within a single analytical framework. By linking these mechanisms to HRM outcomes, organizational development processes and company financial performance, the study extends existing research on knowledge transfer and international HRM.