International Human Resource Management - Essay Example

International Human Resource Management Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Name Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Course Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Lecturer Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx August 31st, 2012 Introduction Despite the world-spread effects of globalization, any person moving from country to country and from region to region is aware of the diversity in business environment (Giddens, 2002). The business environment is diverse in organization and management and the “traveler” will realize that the differences are brought about by culture. It will also be noted that the way organizations manage its people is largely determined by forces of tradition. On the same point, it will be observed that human resource practices such as recruitment and employees’ relations pose a great difference due to cultural as well as traditions diversity. For example, the employees’ job security in France is higher as compared to that in Britain (Gamble, 2003). It is the purpose of paper to offer an understanding of why human resource and employment practices illustrate differences in international arena. Moreover, this paper will seek to critic the international human resource management (IHRM) in order to understanding the criticism that it-IHRM, tends to emphasis the subordination of national culture and national employment practices to corporate culture and human resource (HR) practices. In addition, we will look at the notion of this criticism so as to establish whether or not its justified. Finally, we will find the costs of subordination if there is any. Literature review Hofstede’s study which was based on empirical survey of two companies which included employees from about 60 countries showed that there is a significant influence of varying cultural tendency across nations (Hofstede, 2001). Hofstede concluded that there are roughly four perspectives that pose these differences in the cultural front. In addition, he presented the origins for the perspectives together with the consequences for behaviour of management. He stated that power gap shows the extent at which people in a certain community accept the subordination or the unequal authority structure (Adler & Gundersen, 2008). For example, we compare Roman empires and Islamic it is evident that the power differences are followed between subordinate and superior. This is however reflected or brought into the organization where managerial consultation with subordinate varies across cultures (Hall & Hall, 1990). The power gap is less in northern side of Europe and USA but in other regions like Africa and Latin America is relatively high but people are adapted to it. Furthermore, uncertainty avoidance refers to the degree at which people in a certain community are ‘geared’ to tolerate uncertainty as well as risks. Administrations as well as rule making are the general features of such organizations and countries. For countries such as Germany, France and Italy are more risk opposed than countries like japan Latin America and Mediterranean countries. As the study reveals, “it is not true to say that the countries that have interiorized risk like Britain and USA have achieved the highest levels of economic performance.” Another perspective is that of individualism against collectivism. The individualism is bent more on societies that tend to be more self-concern. As opposed to individualism, collectivism societies extend their loyalties and responsibilities. In that respect, as Hofstede conforms; the current management policies as well as practices originate from individualism societies. Say, performance contracts and pays. For that reason, they limit applicability in collectivistic which are the developing countries. It is therefore anticipated that countries and organizations move to individualistic as they gain independence economically. Again, the English speaking countries have more tendency of applying individualistic while countries that do not use the use the language apply collectivism (West & Graham, 2004). Masculinity and femininity is a dimension that explains concept of stereotype in men. In tradition, men are known to associate with occupations that have high earnings, jobs that are challenging in nature and with personal recognition (Triandis, 2004). Females on the other hand are known to associate with job relations such as good personal relations, nurturing and sharing as well as employee satisfaction. Nevertheless, the contribution of the research can be challenge on the following accounts; one, it is out dated since the study was conducted between 1960 and 1970. Again, the study discusses culture as a rigid phenomenon and it does not bring the issue of religion and ethnic into picture. However, despite these disapproving facts, the study provides a good basis on understanding the influence of culture to governance and organizational administration. Trompenaars and Hampden-Turner advances Hofstede’s work and gives another “set” of cultural perspectives (Trompenaars & Hampden-Turner 1997). It also focused on human/meanings of the surrounding. In the study which was conducted around 1990, 15,000 managers from 298 countries were investigated. We can have the notion that, if both Trompenaars and Hofstede can provide such an insight on cultural diversity; it is possible that there are other research work that give an insight understanding of the cultural complexities on international business. However, it is clear that there exist a relation between cultural labels and the alignments hypothesized by Hofstede 2001, Hall and Hall 1990, as well as Trompenaars 1993 and what is happening in human resource management internationally. Though allot is left to be empirically proved, the following are evident to be “in one way or the other, directly or indirectly” influenced by cultural diversity across regions. First, the organization structure is it consultative or authoritarian, “flat or tall” and power gap. Second, is the recruitment process; on the point, the recruitment process may be based on merit or “who knows who” criteria. That is attribution against achievement. Third, whether payment and benefits are individually determined or it is collectively determined; as described on individualism against collectivism. The fourth phenomenon that is culture dependent is the level of legal regulations in employment. In this case, employees have to rely on the culture of the country in determining whether or not they will be members of trade unions if they exist. Last but not least is the complex phenomenon of masculinity verse femininity. Here, paternity, childcare provision as well as maternity come out clearly as being influenced by diverse culture (Triandis, 2004).. As cultural theory provide a helpful basis to understand and critic diverse human resource management across nations, it can be argued that most of its contribution is more on providing awareness on cultural uncertainties in the global labuor. Both cultural theories as well as institutional theories establish a sufficient ground to critically analyze international human resources and employment practices. As illustrated in this literature review, national cultural distinctions calls for not only knowledge of adequate behaviour but also an insight understanding of “deeper-level” values and assumptions so as to explain the reason why some behaviours are more apparent in some cultures than others (Sylvie, 2003). Discussion To critically understand and critic the notion that IHRM tends to emphasis the subordination of national culture and national employment practices to corporate culture and human resource (HR) practices, it is important for us to understand what is culture (Awasthi, Chow & Wu, 2001). Culture defined Culture can be said to be the sum total of people’s beliefs, values, rules, artifacts, institutions and techniques in a certain region. In other words, it is the way of life of the people in a given region (Ferner, Almond & Colling, 2005). From the sociological point of view, it is the socialization process which entails family, society as well as education. The resultant behaviour after this interaction and socialization is what is known as culture. Therefore the definition of the word “culture” may vary depending on interest, mode of analysis as well as disciplinary perspective. The study on culture influence on business and management is highly argumentative due to different dimension associate with it. The outstanding elements of culture are norms, customs, attitudes, values, religion and language. The most outstanding element of culture is language. It is commonly known that English is the “language of business”; since most of the international businesses and institutions have adopted the language as the ‘official’ language (Go et al, 1998). It would wrong to suggest that by applying a common language will remove the concept and influence of culture in business. In addition, by use of English in businesses by Britain and USA in foreign countries makes them not to adapt other cultures (Harzing & Van Ruysseveldt, 2006). In other words, the use of English makes the foreign investors not to interact with “commoners” hence they do not learn their culture/s. Religion in some cases affect the business culture through the shared values. For example, Protestants have strong notions about delayed saving, gratification and investment. Therefore, the way a certain community behaves it is likely the same way an organization will have its employees behave. The behaviour in the organization is what is commonly known as corporate culture (Maddox, 1993). Importance of culture in businesses Culture has always been important is every business environment (Gamble, 2003). Say, foreign investor managers may need to understand and have the knowledge to deal with culture of the local employees. In that case, the managers create different organization structures and human resource management strategies. Another example is where merger and acquisition has taken place. Both businesses in the case of merger have to come-up with one culture that will be adapted by the “new” organization (Gerhart & Fang, 2005). Finally, for a foreign business to flourish in a local environment, it requires to understand the culture of the customers in order to give products, services, advertisement and marketing that are in-line with culture of the local people. In a closer look, at the meeting involving different people from different cultural backgrounds; the cultural norms and beliefs vary and the mode of communication will inevitably influence effectiveness and efficiency. The influence will be therefore reflected in the workplace and in all quarters of the organization (Calveley, 2008). Organizations also tend to have distinct organizational practices as well as decision making practices that are more influenced by the enshrined organizational culture (Marshall, & Boush, 2001). Culture also influences how employees perceive their work in terms of attitude and employer. Culture determines what people want; therefore, managers must see to it that customers’ different needs of products and services are met. Failure to adapt to the local culture may be a “mistake” in not only marketing but also in communication (Oded, 2001). For example, the failure of Ford mistake to market a vehicle using the name “Feira” which means an “ugly old woman”. Again, the Ford high-end car-comet was marketed in Mexico which is the Mexican slang for “prostitute.” These reviews that managers in the international businesses have to understand that different language have different meaning for the same word. To achieve this, they need to understand culture of the “host” country as well as the people (Giddens, 2002). Another good example of influence of culture to business is the experience of McDonald’s. McDonald’s is an international flourishing business but since it was established in USA, it does not go in details in the culture of host countries. Despite managers of McDonald’s constantly reminding their customers that “they are locals” by the mere fact that they have employed local people, McDonald’s have continued to bare challenges emanating from culture difference (Adler & Gundersen, 2008). One of the challenge faced by McDonalds associated with culture is believe of the local people that having a meal in McDonald’s puts them in class of affluent. Cost of subordination of national culture Subordination of national culture and national employment practices to corporate culture and HR practices comes with some cost. It is thought that cultural practices of the “dominant” social classes become or are made the valid culture which result to social cost of social classes subordination. For example, the use of English as a mode of communication for international businesses comes with the disadvantage since it might be assimilated into the culture of the host country because English is dominate. The most eminent one is the issue of staffing. It is well known that success of an organization is subject to good staffing. So, the management of the organization must be familiar with national labor of the host country. It must also consider to hire the local employees or to “transfer” personnel from the “home.” Failure to understand the culture of the local people might well mean that management might not understand the culture of their employees (Sylvie, 2003). Consequently as stated above, the organization might not realize its dreams of success. Another issue crowded with influence of culture is directing. It is well noted that cultural differences make the directing responsibilities more difficult for international managers (Lenartowicz & Kendall, 2001). This is because; employees’ problem solving and attitude toward employers as well as work vary with culture. On the same point, different cultures comes with different languages hence communication breakdown. When directing is mentioned, the issue of leadership comes in handy. Culture difference is known to influence even the style of leadership. If for these reasons culture difference is not well understood by international managers, then the directing and leadership of the organization and its employees may be doomed. Last but not least is the cost of controlling. Culture is known to differ and so is geographic distance, legal restrictions and language (West & Graham, 2004). Since, meeting, inspections and reporting are put of international control system; they are as well influenced by national culture subordination. For example, in most nations, holidays, pensions, bonuses and trade unions are statutory and many of the employees regard them as rights. International managers are therefore limited to control their operations. Failure to understand the cross-cultural difference between regions, costs the managers allots since they would not be able to control not only the operations but also the employees (Scullion, 1994). Conclusion In conclusion, it is important to point out that the criticism that IHRM tends to emphasis the subordination of national culture and national employment practices to corporate culture HR practices is justified. It is evident from the discussion that employment practices such as recruitment process and organizational culture are strongly influenced by culture difference. This call for international managers as well as IHRM personnel to understand that varying culture affect greatly the way they manage, control, operate and direct their responsibilities (Lenartowicz & Kendall, 2001). In addition, culture differences affect the employees’ attitude and corporate culture. Failure to understand these influences can cost the international organization/s a great deal (Marshall, & Boush, 2001). Moreover, IHRM personnel and practitioners need not fail to understand that much still needs to be researched on this area to fully understand and highlight the effects. This comes about because the dominant members of the society confront the “less” dominant members of the society which is eventually reflected on material benefits hence accruing the cost of cultural subordination. Finally, since culture is dynamic; one can conclude that the influence associated with it will continue to increase, more so with the increase of effects of globalization (Giddens, 2002). 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