HRM Challenges Faced in China - Case Study Example

Running head: International HRM International HRM Name Course Tutor Date Table of contents Background 3 Aim 3 Outline and structure 3 HRM challenges faced in China 4 How these challenges differ from the US and the UK 7 Conclusion 9 Bibliography 11 Background One of the roles of management within an organization is Human Resource management and this entails the process of recruiting, management, and offering direction to employees. This is a function that directly relates to people in terms of acquiring them, rewarding them, compensation, and managing their performance among other duties. The success in the functions aforementioned relating to the management of human resources is not only determined by the management but also by the size of the organization (Brown & MacBean, 2005, 21). Aim As initially mentioned, the process of ABC Company establishing itself in China, the UK, and the US market will not be an easy task. Several challenges will be encountered on the way towards achieving its goals and objectives (Zhu, & Warner, 2004, 320).The purpose of this research will involve the identification of human resource challenges that this company will face in its prospective China market. Additionally, HRM challenges in the UK and the US market will be identified and compared with those challenges that may be encountered in the Chinese market (Vance et al, 2006, 61). In the recent past, most countries have greatly facilitated the globalization of human resources and this research will greatly dwell in unearthing the challenges being faced while effort is being made to ensure success (Bowen et al, 2002, 118). Outline and structure There are several approaches that can be employed in the study and research of international human resource management. The most common approach is that one that takes into consideration the management of diverse culture and behavior within companies in a global viewpoint (Civil Service Branch, 1995). The other approach will involve the proportional examination of the industrial and labor affairs with the sole aim of coming up with a concrete description, comparison, and analysis of various human resource management systems in the countries being studied. Since ABC Company has decided to invest in the global market, another approach will seek focus various aspects it will employ as it relates to human resource management (Whittaker, & Byosiere, 2006). HRM challenges faced in China There are several reasons that may make a company to operate globally and as indicated from the profile of ABC Company, the Australian market is full and thus calls for the search of new market opportunities. Such opportunities may obviously be found outside the country because the customers in those countries may have a positive taste for the goods they intend to offer (Civil Service Branch, 1995). This is what has made the company to try and invest in the China, the US and the UK market. It is however important to note that the human resource challenges that will be faced by this company in the prospective countries will always vary and should never be assumed that they are the same This therefore means that the managers should adopt activities that will help the ABC to achieve its intentions of going global (Jackson, 2002, 148). After a thorough research on the Chinese market, various challenges relating to human resource management were identified. The possible challenges that the ABC Company could face as it establishes itself in China were seen to revolve around the cultural environment, political environment, deployment, among others The complexities involved in operating in a business outside Australia for the ABC Company, will raise the issue of differentiation in the modalities encountered in the acquisition of various categories of employees. The human resource managers will at all times be required to promote the cultivation of values, ethics, and beliefs in the management of workplace diversity (Mungenast, 2007, 6). Additionally, they should motivate the employees thus enhancing their chances of achieving their goals and objectives. The cultural challenges that will be faced be ABC Company in China can best be explained by Hofstede’s theory that assumes that most managers operate in businesses that traverse various cultural values and will ultimately influence how management practices are carried out (Aswathappa & Dash, 2007 36).The culture of a certain society will always revolve around family structures, educational structures, religion, and forms of government. This approach always values the orientation of culture and the planning of human resource management and will indicate the involvement of individual in a particular task. It influences the distinct psychological variables that influence the working environment. (Whittaker, & Byosiere, 2006). This Hofstede’s approach is suitably used in this study since it will show the differences between nations by showing the relationship of individuals in the work place and motivational techniques. He argued in his part that people can either work as solitary individuals, or collectively. Motivational orientation will be influenced by the gender of the workers and this creates a lot of challenges in the society. Uncertainty avoidance of the employees and power distance are the parameters that will create challenges to the ABC Company as they open outlets in China There are a lot of cultural characteristics that causes challenges human resource management practices in China. (Civil Service Branch, 1995).Most workers in China are always worried about the security of jobs that they are willing to do. This is aggravated by hunger and political confusion that took root in the late 1950s and early 1960s. This made a lot of people to be inclined towards the jobs that are long term. This is a great challenge to the ABC Company because its human resource managers will be forced to change tact and to employ people to work on permanent terms. Doing anything contrary to this will lead to poor recruitment since nobody would like to work on jobs that have limited security (Whittaker, & Byosiere, 2006). The collectivist nature of the Chinese society as explained by Hofstede’s theory will make it hard for the company to acquire the best talented people. This is because people are not willing to stand out from the crowd and do not like taking risks. The ‘Quanxi’/connections as part of Chinese culture are also seen as one of the challenge that faces HRM because any relationship between the managers and their subordinates influences those that are to be hired. The mode of acquisition and rewarding employees in this case is done on the basis of ‘who-knows-who’ and this creates a potential trouble to international companies that may not understand it implications (Mungenast, 2007, 6). The political environment may also be another source of challenges to the ABC Company especially in terms of currency, conflicting laws, and handling the skyrocketing prices of goods and services. It is important to note that the government has laid rules that restrict the mobility of labor from one state to the other (Aswathappa & Dash, 2007 36). This means that the company may be forced by the prevailing circumstances to employ individuals who are not qualified to perform a particular task, if they establish their business in the place where the required professional can be found Additionally, another challenge arising from the political point of view is the fact that the government of usually grabs the very qualified personnel to work in the ministries and other offices. This will leave the private sector with few qualified people They will have no other choice but to employ individuals who may be having lower standards than what is required by their HRM. This is a challenge that may greatly affect the quality of services given and offered by the company. Other challenges that may be faced by the company in the course of establishing its business in China includes the acquisition of individuals with questionable habits since there is a high competition for the qualified individuals. (Snape, & Redman, 2009). Other challenges related to deployment are the requirement of workers to join trade unions and the employment of individuals who may no be necessarily qualified. The advancement in technology each and every day creates a challenge to the company since it may have to retrain its employees each and every moment. This greatly contributed by the dynamic nature of China’s economy that is changing drastically each day. How these challenges differ from the US and the UK The challenges likely to be faced by ABC Company in the UK and the US are drastically different from those that are faced in China. One example is the fact that in China, companies have to invest a lot of money to help them unearth the best candidates from the multitude who are hiding due to their notion that they should work collectively as explained by Hofstede’s theory. The challenge faced in the Anglo-American and European market however is the stiff competition of employees who believe they can work best as individuals (Vance et al, 2006, 61).This capitalist notion of the individuals forces the human resource managers to invest a lot of money in competitive recruitment drives as they will try to identify the best employees (Civil Service Branch, 1995). As earlier indicated, employees in China can only join one trade unions while in the UK and the US market, they can join as many as they want. This creates a challenge to the company since the employees are given the opportunity to demand many rights that may not be met easily. The freedom of employees to move freely in the European and the US market threatens the company’s workforce and anytime they can loose valuable employees to the outside market. While it is a challenge in China to reward employees in China due to the ‘connections’, it is a challenge in the US and the UK when all employees become very competitive to an extent that it becomes hard for the management to identify the best ways to reward their employees (Man, 2005). Another aspect that exists in the Chinese market from the US and the UK market is the Anglo-American HRM practices where there is wide acceptance and importance in the utilization and development of the abilities of the employees. This is taken to be a means of encouraging competition within the workforce and is usually done government policies that promote education and trainings of employees (Mungenast, 2007, 6). The ultimate result is the supply of very qualified personnel with the required skills in the market. This system also consists of a five-phase program designed to train employees on the various cultures that they will encounter as they work. This is aimed at meeting the various challenges and be able to work with minimum obstacles. This minimizes the challenges met but it is however lacking in the Chinese HRM market where there are a lot of challenges associated with expatriation and absence of Anglo-American model complicates the whole situation (Welbourne, 2008). The European mode of labor development, management and capitalism has been developed in the sense that it is designed to curb the cross-cultural challenges that may prevail in the market. One case for instance is the policy that may appear to favor capitalism exemplified by the Social Charter framework that outlines sufficient steps concerning the mode of rewarding employees (Jackson, 2002, 148). This is a good way of tackling the prevailing challenges in HRM in the European and the US by finding ways to face the problem of controlling benefits costs on the member states. The quest for capitalism in the European market has also seen the reduction in the collective bargaining power of employees and a promising decentralization in the future while the development of irrelevant unions being further reduced. (Snape, & Redman, 2009). This promotes ‘individualized’ professionalism that may in the long prove to be less challenging than the group behavior witnessed in the Chinese market. This is a drastic contrast with the challenges faced in such a market like China where the government has poor HR policies resulting in a cycle of endless challenges (Aswathappa & Dash, 2007 36). Conclusion Any company that has decided to operate globally should be ready to face the challenge that accompanies the decision. It is clear from this research that China brings mores challenges to the floor and ABC Company should consider them critically before rolling out its operations. The business will only be successful if the company braces itself to face the cultural, political and the other challenges. (Welbourne, 2008). Over the years, there have been a lot of emerging issues on some of the practices of human resource sector and they include introduction of quality management standards, usage of various tools of analysis and models of organizations aimed at ensuring that it remains competitive in the market. However, the change in cultural, legal, social and ethical environments forces the organizations to change their investment approaches so that they can be able to operate in such markets without any objections. It is also important to note that global human resource management experiences a lot of challenges ranging from diversity of workers, quality management, employee motivation and coping up with technological advancements (Jackson, 2002, 148). Bibliography Aswathappa & Dash. (2007). International Human Resource Management. Tata McGraw-Hill, pp 36, retrieved on August 23, 2010 http://books.google.co.ke/books?id=I0jO7dzlj24C&pg=PA36&dq=international+hrm+fo cus+on+china&hl=en&ei=0TRyTJnfIs3f4AaH3ui1Cw&sa=X&oi=book_result&ct=result &resnum=7&ved=0CFMQ6AEwBg#v=onepage&q&f=false Brown, D. H. & MacBean, A. I. (2005). Challenges for China's development: an enterprise perspective. Routledge Publishers, pp 121. retrieved on August 23, 2010 http://books.google.co.ke/books?id=V4RzQfVWnTIC&pg=PA121&dq=Hofstede%E2% 80%99s+cultural+dimensions,&hl=en&ei=BDlyTKDmDJKB4QawwODeCA&sa=X&oi =book_result&ct=result&resnum=2&ved=0CC0Q6AEwAQ#v=onepage&q=Hofstede%E 2%80%99s%20cultural%20dimensions%2C&f=false Civil Service Branch, (1995). HUMAN RESOURCE MANAGEMENT.Civil Service Branch December 1995 Jackson, T. (2002). International HRM: a cross-cultural approach. SAGE Publishers, pp 148 Retrieved on August 23, 2010 http://books.google.co.ke/books?id=MuVaMzrF86QC&printsec=frontcover&dq=internat ional+hrm&hl=en&ei=xzByTJjVLIiW4gax- e3eCA&sa=X&oi=book_result&ct=result&resnum=1&ved=0CC8Q6AEwAA#v=onepag e&q&f=false Man, H. (2005). Selective Implementation of Management Knowledge: Human Resource Management in China Mungenast, H. (2007). Chinese Business Culture. GRIN Verlag publishers, pp 8, retrieved on August 23, 2010 http://books.google.co.ke/books?id=9ouZEYT4QvcC&pg=PA8&dq=Hofstede%E2%80 %99s+cultural+dimensions,&hl=en&ei=BDlyTKDmDJKB4QawwODeCA&sa=X&oi=b ook_result&ct=result&resnum=6&ved=0CEkQ6AEwBQ#v=onepage&q=Hofstede%E2 %80%99s%20cultural%20dimensions%2C&f=false Snape, E. and Redman, T. (2009). HRM Practices, Organizational Citizenship Behaviour, and Performance: A Multi-Level Analysis. Journal of Management Studies. Vance, C. M, Vance, M. & Paik, Y. (2006). Managing a global workforce: challenges and opportunities in international human resource management. M.E. Sharpe Publishers, pp 61 retrieved on August 23, 2010 http://books.google.co.ke/books?id=BJbvdUbql0IC&pg=PA378&dq=hrm+challenges+in +china,+usa.+uk&hl=en&ei=WDZyTNDFKpCG4gbrt4XfCA&sa=X&oi=book_result&c t=result&resnum=6&ved=0CFAQ6AEwBQ#v=onepage&q&f=false Welbourne, T. M. (2008). Is HRM at the table or "under it?" Permalink. Whittaker, D. H & Byosiere, P. (2006).Entrepreneurs, Hrm Orientations.And Environmental Fit:A Uk-Japan Comparison In High Tech Manufacturing Read More