WHY TO NATIONS DIFFER IN HRM?

Exhibit 12.1 The National Context and HRM

RECRUITMENT u Attract qualified applicants

US RECRUITMENT STRATEGIES u Open and public u See Exhibit 12.3

KOREAN RECRUITMENT: A COLLECTIVIST APPROACH u Backdoor u School contacts

SELECTION

THE US APPROACH TO SELECTION u Match skills and job requirements u Universalistic criteria u See Exhibit 12.4

SELECTION IN COLLECTIVIST CULTURES u The in-group u Preference for family u Value personal characteristics u High school and university ties substitute for family membership

IMPLICATIONS FOR THE MULTINATIONAL u Managers must follow local norms to get best workers u Often a tradeoff with benefits of home country practices

TRAINING AND DEVELOPMENT

DIFFERENCES IN TRAINING AND DEVELOPMENT u Result from: – Differences in educational systems – Values regarding educational credentials – Cultural values regarding other personnel practices

Exhibit 12.5 shows skills taught by U.S. organizations

VOCATIONAL EDUCATION IN GERMANY u Standardized national system = a well trained labor force u Affects over 65% of 15 to 16 year olds u Collaboration of employers, unions, and state u See Exhibit Dual system

MANAGEMENT DEVELOPMENT: U.S.A. u Senior level managers often identify managerial potential u Appraisals of managerial readiness u Assessment centers u Mentoring u "Fast track" careers

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

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

IMPLICATIONS FOR THE MULTINATIONAL u Examine feasibility of exporting training u IHRM orientation affects training needs of local managers u Locations advantages - see Exhibit 12.8

PERFORMANCE APPRAISAL u Identifying people to reward, promote, demote, develop and improve, retain, or fire

U.S. PERFORMANCE APPRAISAL SYSTEM u Performance standards u Performance measures u Performance feedback u Human resources decisions u Must meet legal requirements

PERFORMANCE APPRIASAL IN COLLECTIVIST CULTUES u Managers work indirectly to sanction poor performance u Often avoid direct performance appraisal feedback

COMPENSATION u Wages and salaries, incentives such as bonuses, and benefits such as retirement contributions

COMPENSATION IN THE U.S. u Wages and salaries differ based on two major factors – External – Internal

COMPENSATION IN JAPAN u Base salaries for positions u Skill and educational requirements u Age u Marital status and family size may count u Bonuses

NEW MERIT (Japanese style) u Can affect pay raises to a greater degree the traditional position/seniority system u Does not match the Western view - Nenpo u Stresses attitudes as much as performance

EX THE JAPANESE PAY RAISE FORMULA

EVALUATION/COMPENSTATION: Implications for the Multinational u Match HRM orientation u Seek location advantages in wages u See Exhibit next

A COMPARATIVE VIEW OF LABOR RELATIONS

PATTERNS OF LABOR RELATIONS DEPEND ON: u Historical factors u Ideology reasons u Management views of unions

UNION MEMBERSHIP DENSITY u Germany: estimated 40% belonged to trade unions u U.S.A.: 15.8% nonagricultural workforce--down from a high of over 35% in the early 1940s u Denmark: over 80% unionized u Great Britain: approximate 50% unionized

SOME HISTORICAL UNION DIFFERENCES u German – Formalized, legalistic – Bargaining centralized between large unions and large corporations – Works Councils

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

UNION STRUCTURES u Enterprise u Craft u Industrial u Local u Ideological u White collar/professional

IMPLICATIONS FOR THE MULTINATIONAL u Must deal with local labor practices u A factor in location choice - see Exhibit 13.13

EXHIBIT WHO GETS ALONG?

CONCLUSIONS u National context and HRM – Major contrasts between individualist U.S. v. collectivist u Recruitment and selection u Training and development u Performance evaluation and compensation

u Unionization u Implications for location decisions