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CHAPTER 12 NATIONAL DIFFERENCES IN HRM: KNOWING WHEN AND HOW TO ADAPT. WHY TO NATIONS DIFFER IN HRM?. Exhibit 12.1 The National Context and HRM. SOCIAL INSTITUTIONS. Include the family, educational, economic, and the political and legal systems
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CHAPTER 12 NATIONAL DIFFERENCES IN HRM: KNOWING WHEN AND HOW TO ADAPT
Exhibit 12.1 The National Context and HRM
SOCIAL INSTITUTIONS • Include the family, educational, economic, and the political and legal systems • Closely linked with national and business culture
THREE TYPES OF ISOMORPHISM • Coercive • Mimetic • Normative
THE NATIONAL CONTEXT AND KEY BUSINESS PRACTICES • Education and training of labor pool • Laws and cultural expectations for selection practices • Types of jobs favored
The national context and key business practices, continued • Laws and cultural expectations of fair wage and promotion criteria • Laws and traditions regarding labor relations
RESOURCE POOL • The resource pool represents all the human and physical resources available in a country - both from natural and induced factor conditions
RECRUITMENT Attract qualified applicants
US RECRUITMENT STRATEGIES • Open and public • See Exhibit 12.3
Backdoor School contacts KOREAN RECRUITMENT: A COLLECTIVIST APPROACH
Match skills and job requirements Universalistic criteria See Exhibit 12.4 THE US APPROACH TO SELECTION
SELECTION IN COLLECTIVIST CULTURES • The in-group • Preference for family • Value personal characteristics • High school and university ties substitute for family membership
IMPLICATIONS FOR THE MULTINATIONAL • Managers must follow local norms to get best workers • Often a tradeoff with benefits of home country practices
DIFFERENCES IN TRAINING AND DEVELOPMENT • Result from: • differences in educational systems • values regarding educational credentials • cultural values regarding other personnel practices
Exhibit 12.5 shows training systems used in different countries
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
MANAGEMENT DEVELOPMENT: U.S.A. • Senior level managers often identify managerial potential • Appraisals of managerial readiness • Assessment centers • Mentoring • "Fast track" careers
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
Management development: traditional Japanese style, continued • Similar pay and promotion for first ten years - age seniority • Informal recognition of those high performance managers
SHIFITING SOCIAL INSTITUTIONS: PRESSURES FOR CHANGE • Asahi ties promotions to evaluations • Matsushita uses merit pay for managers • Honda is phasing out seniority
IMPLICATIONS FOR THE MULTINATIONAL • Examine feasibility of exporting training • IHRM orientation affects training needs of local managers • Locations advantages - see Exhibit 12.9
PERFORMANCE APPRAISAL • Identifying people to reward, promote, demote, develop and improve, retain, or fire
U.S. PERFORMANCE APPRAISAL SYSTEM • Performance standards • Performance measures • Performance feedback • Human resources decisions • Must meet legal requirements
PERFORMANCE APPRIASAL IN COLLECTIVIST CULTUES • Managers work indirectly to sanction poor performance • Often avoid direct performance appraisal feedback
COMPENSATION • Wages and salaries, incentives such as bonuses, and benefits such as retirement contributions
COMPENSATION IN THE U.S. • Wages and salaries differ based on two major factors • external • internal
COMPENSATION IN JAPAN: TRADITIONAL APPROACH • Base salaries for positions • Skill and educational requirements • Age • Marital status and family size may count • Bonuses
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
EVALUATION/COMPENSTATION: Implications for the Multinational • Match HRM orientation • Seek location advantages in wages • See Exhibit 12.12 next
PATTERNS OF LABOR RELATIONS DEPEND ON: • Historical factors • Ideology reasons • Management views of unions
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
SOME HISTORICAL UNION DIFFERENCES • German • formalized, legalistic • bargaining centralized between large unions and large corporations • works council
French--militant/strong ideologies • U.S.--"bread and butter" issues--wages, benefits, and working conditions
UNION STRUCTURES • Enterprise • Craft • Industrial • Local • Ideological • White collar/professional
IMPLICATIONS FOR THE MULTINATIONAL • Must deal with local labor practices • A factor in location choice - see Exhibit 12.16
CONCLUSIONS • National context and HRM • contrasts between individualist U.S. v. collectivist • Recruitment and selection • Training and development • Performance evaluation and compensation