In this report, we investigate the quality of management practices in manufacturing plants in the Western Balkans. In particular, we focus on modern operations, quality of monitoring, target setting and talent management. Drawing on 385 survey responses from plant managers in Bosnia and Herzegovina, Croatia, North Macedonia and Serbia, we find that management practices scores are similar in all four countries. Our results also show significant variation in management scores across industries and ownership types of the plants. Furthermore, the plants owned by foreign MNCs were found to be better run than domestic plants in all types of management practices in all four countries. Trying to answer the question which MNC HQ resources significantly affect the level of management practices in their subsidiary plants, we find that the average HQ country level of management practices is positively associated with the level of management practices in their subsidiary plants. This effect is even stronger when the HQ provides written procedures and trainings to subsidiary plants to help them implement the best practices from the HQ. Finally, based on the personal interviews with managers in 28 plants, we highlight external conditions that prevent the plants from improving their management practices.
A study supported by Festo Fellowship