Cross cultural management 5e by cullen CH12

Learning Objectives• Understanding how the national context affects HRM practices • Identify how recruitment and selection practices differ in various national contexts • Identify possib

Chapter 12

HRM in the Local Context:

Knowing When and How to Adapt

Learning Objectives

• Understanding how the national context affects HRM

practices

• Identify how recruitment and selection practices differ

in various national contexts

• Identify possible host adaptations in recruitment and

selection practices

• Understanding how the national context affects HRM

practices

• Identify how recruitment and selection practices differ

in various national contexts

• Identify possible host adaptations in recruitment and

selection practices

• Identify how performance evaluation and

compensation practices differ in various national

• Identify how performance evaluation and

compensation practices differ in various national

contexts

Learning Objectives

• Identify possible host country adaptations in

performance evaluation and compensation practices

for a multinational company

• Understand how labor costs vary

• Appreciate how the national context and historical

conditions affect the relationship between management and labor

• Identify possible host country adaptations in

performance evaluation and compensation practices

for a multinational company

• Understand how labor costs vary

• Appreciate how the national context and historical

conditions affect the relationship between management and labor

Key Questions Regarding Local Employees

• How can we identify talented local employees?

• How can we attract these employees to apply for jobs?

• Can we use our home country’s training methods with local employees?

• What types of appraisal methods are customary?

• What types of rewards do local people value?

• Do any local laws affect staffing, compensation, and

training decisions?

• How can we identify talented local employees?

• How can we attract these employees to apply for jobs?

• Can we use our home country’s training methods with local employees?

• What types of appraisal methods are customary?

• What types of rewards do local people value?

• Do any local laws affect staffing, compensation, and

training decisions?

Why Do Nations Differ in HRM?

• Because of the national context

- National culture and social institutions influence how managers make decisions regarding strategies

• Countries vary widely with regards to social institutions and national culture

- Multinationals must select and implement practices that meet national context

• Because of the national context

- National culture and social institutions influence how managers make decisions regarding strategies

• Countries vary widely with regards to social institutions and national culture

- Multinationals must select and implement practices

that meet national context

Exhibit 12.1: How the National Context

Leads to National Differences in Local

HRM Practices

Why Do Nations Differ in HRM?

• Because of the resource pool: all the human and

physical resources available in a country

- Include quality of labor, availability of scientific

laboratories, and sources of fuel

- Arise from both from natural and induced factor

conditions

- Unique to each country

• Because of the resource pool: all the human and

physical resources available in a country

- Include quality of labor, availability of scientific

laboratories, and sources of fuel

- Arise from both from natural and induced factor

conditions

- Unique to each country

Key Factors that Influence the Resource Pool

• The quality, quantity, and accessibility of raw material

• The quantity, quality, and cost of personnel available

• The scientific, technical, and market-related knowledge available to firms

• The cost and amount of capital available to firms for

operations and expansion

• The type, quality, and costs of supporting institutions

such as the systems of communication, education, and

• The quality, quantity, and accessibility of raw material

• The quantity, quality, and cost of personnel available

• The scientific, technical, and market-related knowledge available to firms

• The cost and amount of capital available to firms for

operations and expansion

• The type, quality, and costs of supporting institutions

such as the systems of communication, education, and

National Factor Conditions:

Natural and Induced

• Natural factor conditions: national resources that occur naturally E.g., abundant water supply

• Induced-factor conditions: national resources created

by a nation E.g., superior educational system

• Natural factor conditions: national resources that occur naturally E.g., abundant water supply

• Induced-factor conditions: national resources created

by a nation E.g., superior educational system

Characteristics of the National Context That Affect HRM

• Education and training of the labor pool

• Laws and cultural expectations for selection practices

• Types of jobs favored by applicants

• Laws and cultural expectations regarding fair wages

and promotion criteria

• Laws and traditions regarding labor practices

• Education and training of the labor pool

• Laws and cultural expectations for selection practices

• Types of jobs favored by applicants

• Laws and cultural expectations regarding fair wages

and promotion criteria

• Laws and traditions regarding labor practices

• The major steps in recruitment

1 Managers determine that jobs are available

2 Employers determine the types of people and

skills that are necessary for the job

3 Employers generate a pool of applicants for the

job

• The major steps in recruitment

1 Managers determine that jobs are available

2 Employers determine the types of people and

skills that are necessary for the job

3 Employers generate a pool of applicants for the

job

Exhibit 12.2: Steps in the

Recruiting Process

Recruitment Strategies

• Walk-ins or unsolicited applications

• Newspaper or Internet advertisement

• Company Web site job posting

• Internal job postings

• Public and private personnel agencies

• Placement services of educational institutions

• Current employee recommendations

• Walk-ins or unsolicited applications

• Newspaper or Internet advertisement

• Company Web site job posting

• Internal job postings

• Public and private personnel agencies

• Placement services of educational institutions

• Current employee recommendations

Recruitment in the U.S.

• U.S managers tend to see newspapers as one of the most effective recruitment methods

• Fear employee referrals result in the recruitment of

people with similar backgrounds

• Fear that recruitment by personal contacts may result

in biases against some groups

• Open and public advertisements are the most effective This is a reflection of U.S individualistic culture

• U.S managers tend to see newspapers as one of the

most effective recruitment methods

• Fear employee referrals result in the recruitment of

people with similar backgrounds

• Fear that recruitment by personal contacts may result

in biases against some groups

• Open and public advertisements are the most effective This is a reflection of U.S individualistic culture

Exhibit 12.3: Most Effective

Recruiting Sources for U.S

Companies

Recruitment in Collectivist Countries

• Backdoor recruitment: prospective employees are

friends or relatives of those already employed

• Focus on the in group such as family and friends

• Managers are recruited from prestigious universities

• Backdoor recruitment: prospective employees are

friends or relatives of those already employed

• Focus on the in group such as family and friends

• Managers are recruited from prestigious universities

Recruitment Around the World

• Individuals around the world have preferred way to find jobs

• International Social Survey Program data was

analyzed

• Looking for jobs through public vs private agencies

- Individuals in former communist and socialist

societies were more likely to rely on public agencies

• Individuals around the world have preferred way to find jobs

• International Social Survey Program data was

analyzed

• Looking for jobs through public vs private agencies

- Individuals in former communist and socialist

societies were more likely to rely on public agencies

Recruitment Around the World (cont.)

• Advertising in newspapers and responding to

newspaper ads

- Both very public forms of recruitment

- Individualistic societies have higher preference for

such forms

• Apply directly versus asking friends/relatives for job

- Individualistic and high femininity societies more

likely to favor direct application

• Advertising in newspapers and responding to

newspaper ads

- Both very public forms of recruitment

- Individualistic societies have higher preference for

such forms

• Apply directly versus asking friends/relatives for job

- Individualistic and high femininity societies more

likely to favor direct application

- Socialist societies rely on asking friends/relatives

Exhibit 12.4: Preferred Ways to Look for a New Job—Public vs Private Agency

Exhibit 12.5: Preferred Ways

to Look for a New Job

Exhibit 12.6: Preferred Ways

to Look for a New Job

Selection in the U.S.

• Job qualifications

• Match skills and job requirements

• Individual achievements

• Prohibitions against nepotism—the hiring of relatives

• Forbidding managers to supervise family members

• Job qualifications

• Match skills and job requirements

• Individual achievements

• Prohibitions against nepotism—the hiring of relatives

• Forbidding managers to supervise family members

Exhibit 12.7: Typical Steps in

U.S Personnel Selection

Selection in Collectivist Cultures

• Based on the in-group

• Preference for family

• Value potential trustworthiness, reliability, and loyalty

over performance-related background

• High school and university ties substitute for family

membership

• Based on the in-group

• Preference for family

• Value potential trustworthiness, reliability, and loyalty

over performance-related background

• High school and university ties substitute for family

membership

Implications for the Multinational: Recruitment and Selection

• Managers must understand and adapt to local

practices

• Without adaptation , may not have access to

appropriate recruitment channels

• Thus, may not get the best employees and also offend cultural norms or break host country laws

• Managers must understand and adapt to local

practices

• Without adaptation , may not have access to

appropriate recruitment channels

• Thus, may not get the best employees and also offend cultural norms or break host country laws

Training and Development

• Need for training and development varies by country

• Differences in training and development due to

- Differences in educational systems

- Emphasis on training placed by national

governments

- Cultural values regarding other personnel practices

• Need for training and development varies by country

• Differences in training and development due to

- Differences in educational systems

- Emphasis on training placed by national

governments

- Cultural values regarding other personnel practices

Exhibit 12.8: Training Systems

around the World

Training and Development in the U.S.

• Companies with over 100 employees invest more than

$60 billion in training costs

• Management development and computer skills are the most popular

• There is growing pressure on U S businesses to

supplement basic educational training

• Need for skills training as the U.S shifts to the service sectors

• Companies with over 100 employees invest more than

$60 billion in training costs

• Management development and computer skills are the most popular

• There is growing pressure on U S businesses to

supplement basic educational training

• Need for skills training as the U.S shifts to the service sectors

Exhibit 12.10: Skills Taught by

U.S Organization

Training and Vocational Education in Germany

• Two major forms of vocational education

• General and specialized vocational schools and

professional and technical colleges

• Dual system: combination of in-house apprenticeship training with part-time vocational-school training, and

leads to a skilled worker certificate

- Meister: a master technician

• Two major forms of vocational education

• General and specialized vocational schools and

professional and technical colleges

• Dual system: combination of in-house apprenticeship

training with part-time vocational-school training, and

leads to a skilled worker certificate

- Meister: a master technician

German Dual System

• Stems from collaboration among employers, unions,

and the state

• Costs shared between companies and state

• Employers have obligation to release employees for

training

• Standardized throughout the country

• Produces well trained national labor force with skills

• Stems from collaboration among employers, unions,

and the state

• Costs shared between companies and state

• Employers have obligation to release employees for

training

• Standardized throughout the country

• Produces well trained national labor force with skills

Exhibit 12.11: Germany’s

Apprenticeship Program

under Pressure

Implications for the Multinational: Training and Development

• Examine quality of workers and managers in host

country

• Examine feasibility of exporting training

• Adaptation of management development to different

national contexts depends on intended use of host

country managers

• Corporate culture dominates management

development policies , if host country nationals

• Examine quality of workers and managers in host

country

• Examine feasibility of exporting training

• Adaptation of management development to different

national contexts depends on intended use of host

country managers

• Corporate culture dominates management

development policies , if host country nationals

Performance Appraisal

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

• Not everyone can climb up the corporate ladder

• Need to fairly and objectively assess how employees perform

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

• Not everyone can climb up the corporate ladder

• Need to fairly and objectively assess how employees perform

U.S Performance Appraisal

• Rational, logical and legal

• Has four elements

• Performance standards

• Performance measures

• Performance feedback

• Human resource decisions

• Rational, logical and legal

• Has four elements

Exhibit 12.12: Cross-National

Differences in Purposes of

Performance Appraisals

Performance Appraisal Around the World

• Australia, Canada and the United States

- Among the top five countries for all performance-appraisal

purposes

- Very high on individualism where there is heavy emphasis

on the individual development of the employee

- Performance appraisals are the most effective method to

gauge how well an employee is doing and how their

performance can be improved

• Australia, Canada and the United States

- Among the top five countries for all performance-appraisal

purposes

- Very high on individualism where there is heavy emphasis

on the individual development of the employee

- Performance appraisals are the most effective method to

gauge how well an employee is doing and how their

performance can be improved