HUMAN RESOURCES MANAGEMENT IN DIFFERENT CULTURES

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CHAPTER 12 NATIONAL DIFFERENCES IN HRM KNOWING
WHEN AND HOW TO ADAPT
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WHY TO NATIONS DIFFER IN HRM?
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Exhibit 12.1 The National Context and HRM
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SOCIAL INSTITUTIONS

• Include the family, educational, economic, and
  the political and legal systems
• Closely linked with national and business culture

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THREE TYPES OF ISOMORPHISM

• Coercive
• Mimetic
• Normative

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THE NATIONAL CONTEXT AND KEY BUSINESS PRACTICES

• Education and training of labor pool
• Laws and cultural expectations for selection
  practices
• Types of jobs favored

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The national context and key business practices,
continued

• Laws and cultural expectations of fair wage and
  promotion criteria
• Laws and traditions regarding labor relations

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RESOURCE POOL

• The resource pool represents all the human and
  physical resources available in a country - both
  from natural and induced factor conditions

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RECRUITMENT

• Attract qualified applicants

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US RECRUITMENT STRATEGIES

• Open and public
• See Exhibit 12.3

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KOREAN RECRUITMENT A COLLECTIVIST APPROACH

• Backdoor
• School contacts

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SELECTION
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THE US APPROACH TO SELECTION

• Match skills and job requirements
• Universalistic criteria
• See Exhibit 12.4

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SELECTION IN COLLECTIVIST CULTURES

• The in-group
• Preference for family
• Value personal characteristics
• High school and university ties substitute for
  family membership

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IMPLICATIONS FOR THE MULTINATIONAL

• Managers must follow local norms to get best
  workers
• Often a tradeoff with benefits of home country
  practices

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TRAINING AND DEVELOPMENT
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DIFFERENCES IN TRAINING AND DEVELOPMENT

• Result from
• differences in educational systems
• values regarding educational credentials
• cultural values regarding other personnel
  practices

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Exhibit 12.5 shows training systems used in
different countries
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Exhibit 12.5 shows skills taught by U.S.
organizations
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VOCATIONAL EDUCATION IN GERMANY

• Standardized national system a well trained
  labor force
• Affects over 65 of 15 to 16 year olds
• Collaboration of employers, unions, and state
• See Exhibit 12.6 - Dual system

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MANAGEMENT DEVELOPMENT U.S.A.

• Senior level managers often identify managerial
  potential
• Appraisals of managerial readiness
• Assessment centers
• Mentoring
• "Fast track" careers

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MANAGEMENT DEVELOPMENT TRADITIONAL JAPANESE STYLE

• Recruits directly from universities
• Join the company as a group
• Selected on personal qualities and fit with the
  corporate culture
• Mutual commitment of permanent employment

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Management development traditional Japanese
style, continued

• Similar pay and promotion for first ten years -
  age seniority
• Informal recognition of those high performance
  managers

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SHIFITING SOCIAL INSTITUTIONS PRESSURES FOR
CHANGE

• Asahi ties promotions to evaluations
• Matsushita uses merit pay for managers
• Honda is phasing out seniority

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IMPLICATIONS FOR THE MULTINATIONAL

• Examine feasibility of exporting training
• IHRM orientation affects training needs of local
  managers
• Locations advantages - see Exhibit 12.9

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PERFORMANCE APPRAISAL

• Identifying people to reward, promote, demote,
  develop and improve, retain, or fire

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U.S. PERFORMANCE APPRAISAL SYSTEM

• Performance standards
• Performance measures
• Performance feedback
• Human resources decisions
• Must meet legal requirements

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PERFORMANCE APPRIASAL IN COLLECTIVIST CULTUES

• Managers work indirectly to sanction poor
  performance
• Often avoid direct performance appraisal feedback
  

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COMPENSATION

• Wages and salaries, incentives such as bonuses,
  and benefits such as retirement contributions

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COMPENSATION IN THE U.S.

• Wages and salaries differ based on two major
  factors
• external
• internal

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COMPENSATION IN JAPAN TRADITIONAL APPROACH

• Base salaries for positions
• Skill and educational requirements
• Age
• Marital status and family size may count
• Bonuses

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NEW MERIT (Japanese style)

• Can affect pay raises to a greater degree the
  traditional position/seniority system
• Does not match the Western view - Nenpo
• Stresses attitudes as much as performance

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EX 12.10 THE JAPANESE PAY RAISE FORMULA
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EVALUATION/COMPENSTATION Implications for the
Multinational

• Match HRM orientation
• Seek location advantages in wages
• See Exhibit 12.12 next

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A COMPARATIVE VIEW OF LABOR RELATIONS
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PATTERNS OF LABOR RELATIONS DEPEND ON

• Historical factors
• Ideology reasons
• Management views of unions

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UNION MEMBERSHIP DENSITY

• Germany estimated 40 belonged to trade unions
• U.S.A. 14.2 nonagricultural workforce--down
  from a high of over 35 in the early 1940s
• Denmark over 80 unionized
• Great Britain approximate 50 unionized

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SOME HISTORICAL UNION DIFFERENCES

• German
• formalized, legalistic
• bargaining centralized between large unions and
  large corporations
• works council

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• French--militant/strong ideologies
• U.S.--"bread and butter" issues--wages, benefits,
  and working conditions

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UNION STRUCTURES

• Enterprise
• Craft
• Industrial
• Local
• Ideological
• White collar/professional

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IMPLICATIONS FOR THE MULTINATIONAL

• Must deal with local labor practices
• A factor in location choice - see Exhibit 12.16

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EXHIBIT 12.16 WHO GETS ALONG?
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CONCLUSIONS

• National context and HRM
• contrasts between individualist U.S. v.
  collectivist
• Recruitment and selection
• Training and development
• Performance evaluation and compensation

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• Unionization
• Implications for location decisions