Chapter 10 Developing a Global Management Cadre © 2006 Prentice Hall

Introduction To maximize long term retention and use of international cadre through career management so that the company can develop a top management team with global experience To develop effective global management teams To understand, value, and promote the role of women and minorities in international management in order to maximize those underutilized resources To maximize the benefits of an increasingly diverse workforce in various locations around the world To work with the host country labor relations system to effect strategic implementation and employee productivity. A crucial factor in global competitiveness is the ability of the firm to maximize its global human resources in the long term. To do this attention must be paid to several important areas which are noted on this slide. © 2006 Prentice Hall

Preparation Adaptation, and Repatriation Effective HRM ends with the successful repatriation of the executive into company headquarters Companies must prepare to minimize the potential effects of reverse culture shock Ineffective repatriation practices are clear – few managers will be willing to take international assignments © 2006 Prentice Hall

Preparation Adaptation, and Repatriation A mentor program to monitor the expatriate’s career path while abroad and upon repatriation As an alternative to the mentor program, the establishment of a special organizational unit for the purposes of career planning and continuing guidance for the expatriate A system of supplying information and maintaining contacts with the expatriate so that he or she may continue to feel a part of the home organization. © 2006 Prentice Hall

The Role of the Expatriate Spouse We began to realize that the entire effectiveness of the assignment could be compromised by ignoring the spouse. —Steve Ford, Corporation Relocations, Hewlett-Packard Research on 321 American expatriate spouses shows effective cross-cultural adjustment is more likely When the firms seek the spouse’s opinion about the international assignment When the spouse initiates his/her own pre-departure training © 2006 Prentice Hall

Expatriate Career Management Support services provide timely help for the manager and, therefore, are part of the effective management of an overseas assignment. The overall transition process experienced by the company’s international management cadre over time is shown in this slide. It comprises three phases of transition and adjustment that must be managed for successful socialization to a new culture and resocialization back to the old culture.These phases are (1) the exit transition from the home country, the success of which will be determined largely by the quality of preparation the expatriate has received; (2) the entry transition to the host country, in which successful acculturation (or early exit) will depend largely on monitoring and support; and (3) the entry transition back to the home country or to a new host country, in which the level of reverse culture shock and the ease of re-acculturation will depend on previous stages of preparation and support. © 2006 Prentice Hall

Developing a Global Management Cadre Managerial Skills, not Technical Skills – learning how to deal with a wide range of people Tolerance for Ambiguity Multiple Perspectives – learning to understand situations from the perspective of local employees and businesspeople Ability to Work with and Manage Others – learning patience and tolerance In the international assignment, both the manager and the company benefit from the enhanced skills and experience gained by the expatriate. Many returning executives report an improvement in their managerial skills and self-confidence. Some of these acquired skills, as reported by Adler, include the following shown on this slide. © 2006 Prentice Hall

Global Management Teams The term global management teams describes collections of managers from several countries who must rely on group collaboration if each member is to experience the optimum of success and goal achievement. © 2006 Prentice Hall

Global Management Teams As shown in this slide, when a firm responds to its global environment with a global strategy and then organizes with a networked “glocal” structure, various types of cross-border teams are necessary for global integration and local differentiation. These include teams between and among headquarters and subsidiaries, transnational project teams, often operating on a “virtual” basis, and teams coordinating alliances outside the organization. In joint ventures, in particular, multicultural teams work at all levels of strategic planning and implementation, as well as on the production and assembly floor. © 2006 Prentice Hall

Virtual Transnational Teams Virtual groups, whose members interact through computer-mediated communication systems, are linked together across time, space, and organizational boundaries Virtual global teams are horizontal networked structure, with people around the world conducting meetings and exchanging information via the Internet, enabling the organization to capitalize on 24 hour productivity © 2006 Prentice Hall

Operational Challenges for Global Virtual Teams © 2006 Prentice Hall

Managing Transnational Teams Do members work together with a common purpose? Is this purpose something that is spelled out and felt by all to be worth fighting for? Has the team developed a common language or procedure? Does it have a common way of doing things, a process for holding meetings? Does the team build on what works, learning to identify the positive actions before being overwhelmed by the negatives? Does the team attempt to spell out things within the limits of the cultural differences involved, delimiting the mystery level by directness and openness regardless of the cultural origins of participants? Do the members recognize the impact of their own cultural programming on individual and group behavior? Do they deal with, not avoid, their differences in order to create synergy? Does the team have fun? The ability to develop and lead effective transnational teams (whether they interact “virtually”, or physically, or, as is most often the case, a mixture of both) is essential in light of the increasing proliferation of foreign subsidiaries, joint ventures, and other transnational alliances. This slide highlights some suggestions to determine if the team is successful. © 2006 Prentice Hall

Managing Transnational Teams Cultivate a culture of trust: One way to do this is by scheduling face-to-face meetings early on Rotating meeting locations Rotating and diffusing team leadership Linking rewards to team performance Build social networks among managers from different countries These are some general recommendations the researchers make for improving global teamwork. © 2006 Prentice Hall

The Role of Women in International Management Avoid assuming that a female executive will fail because of the way she will be received or because of problems experienced by female spouses Avoid assuming that a woman will not want to go overseas Give female managers every chance to succeed by giving them the titles, status, and recognition appropriate to the position – as well as sufficient time to be effective. © 2006 Prentice Hall

Working within Local Labor Relations The term labor relations refers to the process through which managers and workers determine their workplace relationship. This process may be through verbal agreement and job descriptions, or through a union written labor contract which has been reached through negotiation in collective bargaining between workers and managers. © 2006 Prentice Hall

Working within Local Labor Relations The participation of labor in the affairs of the firm, especially as this affects performance and well-being The role and impact of unions in the relationship Specific human resource policies in terms of recruitment, training, and compensation. © 2006 Prentice Hall

Organized Labor Around the World Wage levels which are set by union contracts and leave the foreign firm little flexibility to be globally competitive Limits on the ability of the foreign firm to vary employment levels when necessary Limitations on the global integration of operations of the foreign firm because of incompatibility and the potential for industrial conflict. © 2006 Prentice Hall

Convergence Versus Divergence in Labor Systems Convergence in labor systems occurs as the migration of management and workplace practices around the world results in the reduction of workplace disparities from one country to another. This occurs primarily as MNCs seek consistency and coordination among their foreign subsidiaries, and as they act as catalysts for change by “exporting” new forms of work organization and industrial relations practices. © 2006 Prentice Hall

Trends in Global Relations Systems © 2006 Prentice Hall

Comparative Management in Focus: Germany Codetermination Law (mitbestimmung) – refers to the participation of labor in the management of the firm Mandates representation for unions and salaried employees on the supervisory boards of all companies with more than 2,000 employees and work councils of employees at every work site © 2006 Prentice Hall

Comparative Management in Focus: Germany Union membership is voluntary with one union for each major industry Set the pay scale for about 90% of the country’s workforce Play an active role in hiring, firing, training, and reassignment during times of reorganization and change © 2006 Prentice Hall

Comparative Management in Focus: Germany Foreign companies operating in Germany also have to be aware ha termination costs are very high Including severance pay, retraining costs, time to find another job © 2006 Prentice Hall

Looking Ahead Chapter 11 – Motivating and Leading Motivating Cross Cultural Research on Motivation Leading The Global Leader’s Role and Environment Cross-cultural Research on Leadership Contingency Leadership – The Culture Variable © 2006 Prentice Hall