As companies increase their pace of expanding into the international markets, the subsidiaries of the company face various issues that would make the growth into new markets unsuccessful. The human resource managers might face various challenges and problems in the human resource sector. According to Ferrell & Fraedrich (2015), it is difficult to manage workers abroad compared to home-based employees. The growth of firms internationally determines new tasks and assignments, making it a need to manage it successfully for the benefit of the individuals and the firm. In the case study, Colossal Corporation maintains a subsidiary in Serafini, which is a small nation in Eastern Europe, as New Brand Design, NBD. This essay analyzes issues such as contracts, culture, recruitment process, agreements, and remuneration of the newly formed company.
Corporations that enter a foreign market should discover how to deal with the culture of the people. The culture consists of religion, language, and values among other factors. The firm should consider various factors that are likely to make the market more risky. In this case study, as the Europe-based company moves into the Asian market, many cultural differences should be considered. Responses to other cultures are mainly determined by beliefs, attitudes, assumptions, values, and biases that shape an individual's life. Learning about new cultures necessitates learning new principles of space and time, and new attitudes and values. In this case study, it is clear that the differences in business etiquettes in the Asian-based company are developed due to the cultural and historical development (Matsumoto &Juang, 2016). In the European markets, meeting etiquettes are important. Building a good relationship with the business partners through the required meetings and greetings is important. It is essential to leave the right and good impression with the business partners.
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The theory of cultural dimensions by Hofstede is a framework that revolves around cross-cultural communication. The dimensions collectively show the impact of a culture that is ingrained in the community on the values of the society members. The theory also describes the behavior and values of the individuals when exposed to various issues (Mazanec, Crotts, Gursoy& Lu, 2015). The analysis of the Hofstede’s cultural dimensions shows the differences between the Asian and Europe markets that could be reasons for the conflicts facing the management, (fig 1). In Fig 1, an European country, German and Asian country, India are compared.
Figure 1 : Europe vs. Asia Source: Hofstede Comparison ( Khlif, 2016)
For power distance, the Asian market has a high dimension of 77, showing that the people appreciate top-down structure and hierarchy in the organizations and the society. This means that the individuals are dependent on the boss or the power for direction, and accept unequal rights between the lesser-power privileged and the power-privileged. Real power is centralized, and the managers desire the obedience of the team. In the case study, the employees might not have nominated any employee for the worker incentive plan, since they expect the manager to do so. In the Asian market, the employees expect to be directed, and control is very familiar to them.
Asian people have an intermediate score of 48 for individualism. The Indian community is a society that has individualist and collectivist traits. The collectivists have a high preference for being part of a large social structure, where natives are needed to act based on the larger good of a defined group. The activities of the extended family, one’ family, workgroup, neighbors, and other wider social networks, influence the behavior of the people. For collectivist, being rejected by peers or thought lowly by immediate in-groups would create a sense of rudderless and emptiness (Crane & Matten, 2016). In such a case, promotion and hiring decisions are made based on the relationships that are important in the collectivist society. This would explain why the hiring manager chooses the uncle to fill in one of the company’s positions.
The Asian countries have a score of 40 on uncertainty avoidance. This means that the people accept imperfection, and nothing has to be as planned or perfect. In the community, lenience for the unanticipated is high and sometimes required to break from monotony. The people lack the drive and are not obliged to take actions and reconcile into established routines and rolls with no questions. In this society, rules are put in place to be circumvented and people rely on innovative techniques to bypass the system (Matsumoto &Juang, 2016). The word commonly used is to adjust, and it means several things. It could mean to ignore rules that are flouted to finding inventive and unique solutions to the seemingly insurmountable challenge. Suppliers could ignore some terms on the contracts based on their level of uncertainty avoidance.
In the European countries, it is important to be on time since people hate delays. Arriving late could be considered an insult and rude. In Asian countries, people might not adhere to time for meetings since they prefer discussing issues indirectly rather than creating conflicts. The Asian people might feel more comfortable to be part of a group. They seek counsel and offer direct help to others about their business and personal issues. The Westerners speak softly at the public functions or in restaurants and small groups while the Asians are exuberant and loud with their co-workers and friends in public (Mazanec, Crotts, Gursoy& Lu, 2015). The Asians desire to have strong emotional relations with others while in the western countries; people have casual relationships with professionals and friends. Unlike the Westerners who put the organizational needs ahead of any other individual needs including their issues, Asians desire relationships that are personal since relationships are more important than work.
- Recommendations
In the globalization era, international relationships are an important concept for human resource management. It is needed to practice human resource functions that start recruitment and selection, compensation, performance appraisal, development and training. To be updated with the changing world, the HR managers are required to have an international vision on the way to manage the employees successfully aboard and at home. Nowadays, the HR is no longer the traditional administration and personnel, but it has become more strategic as it deals with various aspects of the workplace, by ensuring that workers contribute effectively and work parallel with the direction of the company to attain the firms’ objectives and goals (Matsumoto &Juang, 2016). This means that HR is no longer focused on paperwork, by paying the workers their salaries and giving them the benefits. It plays an important role in developing and training, and hiring employees, and ensures the retention of the workers for the benefits of the two parties.
The manager could schedule a meeting with the employees and exercise full power. He or she should take control, give direction to the employees, and ensure they are familiar of the consequences of going against the instructions. They should learn work ethics, hence no more chatting in the morning. The workers should be instructed on the need to be on time for meetings and the consequences of being late (Bratton & Gold, 2017). The employees should be trained to work in teams to ensure they know who works best and effectively. This would make the employee incentive plan effective. The company should evolve to face the reality of the new market. Some of the business practices will be overhauled to meet the compliance regulations. Training the employees and suppliers on the need to follow the terms and conditions given in their contracts is crucial.
Developing an organizational culture take time but is effective in the long run (Katan, 2014). The workers should learn about the organizational culture, the priorities they should consider while working, and the way the organization offers promotions. The managers can identify some of the employees that are adhering to organizational culture and promote them to help others feel motivated. In creating the company culture, the managers should define the core values of the firm, and invest time in developing the talent brand. Hofstede’s cultural dimensions show that the people of Asia are interested in working collectively. The managers should allow the workers to fill positions when qualified. However, such employees should know the company policies on nepotism. Suppliers should also be trained on the ethics of the business and the need to focus on these regulations.
- Conclusion
One of the major issues facing the managers at the new company in Asia is the differences between the workers in the company and those in the home-based firm. In Asia, employees tend to start chatting in the morning before they start their duties and they are hardly on time during a meeting. Cultural differences would explain the reasons for the employees in these two companies behaving differences. In most nations and communities, the workplace is where people spend time together and are likely to share beliefs, attitudes, and values. Due to the traditional cultures, the workers might have certain orientations and preferences in different situations. These include communicating and interacting with others, making decisions, working in teams, evaluating and responding to opportunities and risks, and attempting or managing to resolve conflicts or agreements. The employees might have also developed a way to interact with others on different organizational values and engaging in other activities that are not work-related.
References
Bratton, J., & Gold, J. (2017). Human resource management: theory and practice . Palgrave.
Crane, A., & Matten, D. (2016). Business ethics: Managing corporate citizenship and sustainability in the age of globalization . Oxford University Press.
Ferrell, O. C., & Fraedrich, J. (2015). Business ethics: Ethical decision making & cases . Nelson Education.
Katan, D. (2014). Translating cultures: An introduction for translators, interpreters and mediators . Routledge.
Khlif, H. (2016). Hofstede’s cultural dimensions in accounting research: a review. Meditari Accountancy Research , 24 (4), 545-573.
Matsumoto, D., &Juang, L. (2016). Culture and psychology . Nelson Education.
Mazanec, J. A., Crotts, J. C., Gursoy, D., & Lu, L. (2015). Homogeneity versus heterogeneity of cultural values: An item-response theoretical approach applying Hofstede's cultural dimensions in a single nation. Tourism Management , 48 , 299-304.
