3 Discussions and 2 weekly summary

Discussion 7.1

What do you think would constitute an effective alternative dispute resolution system? What benefits would you expect from such a system? If you were asked to rule on a discharge case, what facts would you analyze in deciding whether to uphold or reverse the employers action?

Discussion 7.2

Considering both federal and state labor laws are labor unions still needed in the USA, why or why not? Describe what it means for HR managers when employees win an election to unionize? What can HR do at this point to make sure the employee's and company's interests align?

Discussion 8.1

Describe how a high-performance work system is designed, and explain how the components of it must align horizontally and vertically to support one another and a firm's strategy.

Weekly Summary 7.1 (Chapter 13 and 14 )

This week you will write and submit a minimum of two (2) full page (not including cover page and reference section) summary of the important concepts learned during the week. The paper will include a summary of the topics covered in the readings/chapters for this week.

Weekly Summary 8.1 ( Chapter 15 and 15)

Chapter 16 Implementing HR Strategy: High-Performance Work Systems

Learning Outcomes

Discuss how a firm’s strategy can be achieved with a high-performance work system and what its fundamental principles are

Describe how a high-performance work system is designed, and explain how the components of it must align horizontally and vertically to support one another and a firm’s strategy

Recommend processes for implementing and evaluating a high-performance work system

Discuss a high-performance work system’s potential outcomes for both employees and the organization

High-Performance Work Systems (HPWS)

Specific combination of HR practices, work structures, and processes that maximizes employee’s:

Knowledge

Skill

Commitment

Flexibility

Figure 16.1 – Implementing HR Strategy: High Performance Work Systems

Figure 16.2 – Underlying Principles of High-Performance Work Systems

Egalitarianism and Engagement

Egalitarian work environments

Reduce status and power differences

Increase collaboration and teamwork, which increases productivity

Employee engagement can be increased by:

Involving them in decision making

Giving them power to act

Shared Information and Trust

Critical to the success of employee empowerment and involvement initiatives in organizations

Employees are better acquainted with work and can devise solutions to problems

Employees can make good suggestions for improving business and cooperate in major organizational changes

Knowledge Development

HPWS depends on the shift from touch labor to knowledge work

Employees need to learn in real time, on the job, using innovative new approaches to solve novel problems

Better informed employees, work better

Performance-Reward Linkage

Aligned interests of an organization and its employees make things go smoothly

Performance-based rewards ensure:

Employees share in the gains that result from performance improvement

Fairness and tends to focus employees on the organization

Figure 16.3 – Design Aspects of High-Performance Work Systems

Strategic Alignment

Horizontal fit: Situation in which all the internal elements of the work system complement and reinforce one another

Changes in one component affect all the other components

Vertical fit: Situation in which the work system supports the organization’s goals and strategies

High-performance work systems are designed to link employee initiatives to firm’s strategies

Figure 16.4 – Achieving Strategic Alignment

HR Scorecard

Diagnoses horizontal fit and vertical fit in a straightforward way

Managers diagnose horizontal fit by assessing whether particular HR practices reinforce one another or work at cross purposes

Managers assess whether the HR practices significantly enable key workforce deliverables

Degree of vertical fit is evaluated by assessing the degree to which the workforce deliverables are connected with key strategic performance drivers

Implementing the System

Necessary actions for a successful HPWS

Make a compelling case for change linked to the company’s business strategy

Ensure that change is owned by senior and line managers

Allocate sufficient resources and support for the change effort

Implementing the System

Ensure early and broad communication

Ensure that teams are implemented in a systemic way

Establish methods for measuring the results of change

Ensure continuity of leadership and appoint champions of the initiative

Figure 16.5 – Implementing High-Performance Work Systems

Figure 16.6 – Building Cooperation With Stakeholders

Establishing a Communications Plan

Senior management need to establish the context for change and communicate the vision more broadly to the organization

Commitment from the top is essential to establish mutual trust between employees and managers

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Establishing a Communications Plan

Two-way communication:

Results in better decisions

Helps to diminish the fears and concerns of employees when facing changes

Navigating the Transition to High-Performance Work Systems

Factors that determine the success of established implementation plan

Timetable and process for mapping key business processes

Redesigning the work flow

Training employees

HR managers help employees in transition to handle change

Evaluating and Sustaining the Success of the System

Process audit: Determining whether the high-performance work system has been implemented as designed

Evaluation process needs to focus on the goals of high-performance work systems

Building and fostering high-performance work systems is an ongoing activity

Evaluating and Sustaining the Success of the System

Develop strategies to retain and motivate employees to deal with the problem of employee poaching

Periodically re-evaluate high-performance work systems in terms of new organizational priorities and initiatives

Outcomes of High-Performance Work Systems

Employee outcomes and quality of work life

Benefits of proper implementation of high-performance work systems

New products, services, and markets

Employee satisfaction and increased job security

Outcome of improper implementation

Performance of an organization suffers

Employees develop poor work attitudes and habits

Organizational Outcomes and Competitive Advantages

Innovation

Greater flexibility

Higher productivity

Lower costs

Better responsiveness to customers

Higher profitability

Criteria for Success of High-Performance Work Systems

Valuable

HPWS increases value by establishing ways to increase innovation and efficiency, decrease costs, improve processes, and provide something unique to customers

Rare

HPWS help organizations develop and harness skills, knowledge, and abilities that are not equally available to all organizations

Difficult to imitate

HPWS are designed around team processes and capabilities that cannot be transported, duplicated, or copied by rival firms

Organized

HPWS combine the talents of employees and rapidly deploy them in new assignments with maximum flexibility

Learning Outcomes

Explain the concepts of employee rights and
employer responsibilities
Identify and explain what the privacy rights of employees are
Establish disciplinary policies and differentiate between the two approaches to disciplinary action
Identify the different types of alternative dispute
resolution methods

Employee Rights

Guarantees of fair treatment that become rights when they are granted to employees by the courts, legislatures, or employers
Include rights of employees to:
Protest unfair disciplinary actions
Question genetic testing
Have access to their personal files
Challenge employer searches and monitoring
Be free from employer discipline for off-duty conduct
Federal and state courts view the privacy rights of employees as minimal

Employee Rights vs. Employer Responsibilities

Employer is responsible to provide a safe workplace for employees while guaranteeing safe, quality goods and services to consumers
Employers have to exercise reasonable care while
Hiring
Training
Assignment of employees to jobs

Employee Rights vs. Employer Responsibilities

Employers failure to honor the rights of employees, can result in
Costly lawsuits
Damaging the organization’s reputation
Hurting employee morale
Failure to protect the safety and welfare of employees or consumer interests can invite litigation from both groups

Negligent Hiring

Negligence: Failure to provide reasonable care when such failure results in injury to consumers or other employees
Negligent-hiring lawsuits have forced managers to take extra care in the employment and management

Job Protection Rights

Psychological contract: Expectations of a fair exchange of employment obligations between an employee and employer
Led to the development of legal principles about the security of one’s job
Employment-at-will relationship: Right of an employer to fire an employee without giving a reason and the right of an employee to quit when he or she chooses
Basic rule dominating the private-sector employment relationship

Job Protection Rights

Wrongful discharge: Discharge, or termination, of an employee that is illegal
Suits challenge an employer’s right under the employment-at-will to unilaterally terminate employees
Exceptions to the employment-at-will doctrine
Violation of public policy
Implied contract
Implied covenant
Whistle-blowing: Complaints to governmental agencies by employees about their employers’ illegal or immoral acts or practices

Job Protection Rights

Implied contract – Occurs when an implied promise by the employer suggests some form of job security to employee
Explicit contract – Formal written (signed) agreements grant to employees and employers agreed-upon employment benefits and privileges

Job Protection Rights

Constructive discharge: Employee’s voluntary termination of his or her employment because of harsh, unreasonable employment conditions placed on the individual by the employer
Discharge as a result of retaliation
Discharges and WARN Act

Privacy Rights

Freedom from unwarranted government or business intrusion into one’s personal affairs
Involves the individual’s right to be given personal autonomy and left alone
Drug testing in private sector is regulated by individual states
Pro–drug testing states permit testing, provided strict testing procedures are followed

Figure 13.3 – Recommendations for a Drug-Free Workplace Policy

Impairment Testing

Measures whether an employee is alert enough to work
Also called fitness-for-duty or performance-based testing
Advantage
Focuses on workplace conduct rather than off-duty behavior
Identifies employees impaired because of fatigue, stress, and alcohol use

Electronic Surveillance

Camera surveillance
Phone conversations and text communications
E-mail, internet, and computer use
Searches
Access to personnel files
Off-duty employee conduct
Off-duty employee speech
Workplace romances
Body art, grooming, and attire

Disciplinary Policies and Procedures

Discipline: Tool, used to correct and mould the practices of employees to help them perform better so they conform to acceptable standards
Disciplinary actions should be taken only for justifiable reasons
Employees should be treated fairly and consistently

Figure 13.6 – Common Disciplinary Problems

Result of Inaction

Failure to discipline employees aggravates a problem
HR department is responsible for:
Developing and having top management approve an organization’s disciplinary policies
Ensuring that disciplinary action taken against employees are consistent
Employee’s immediate supervisor
Logical person to apply the company’s disciplinary procedures and monitor the employee’s improvement

Figure 13.7 – A Disciplinary Model

Suggestions to Set Organizational Rules

Have to be reasonable and relate to safe and efficient operation of the organization
Consequences for breaking them should be written down and widely disseminated to all employees
Have to be clearly explained
Employees should sign a document stating that they have read and understand the organizational rules
Have to be reviewed, especially those rules critical to work success

Documenting Misconduct

Failure to record the misconduct of employees, can undermine a firm’s efforts to deal with the behavior
Records of employee misconduct are considered business documents
Admissible evidence in arbitration hearings, administrative proceedings, and courts of law
Significant cause of inadequate documentation
Managers do not know what constitutes good documentation

Inclusions in the Documentation

Date, time, and location of the incident(s)
Behavior exhibited by the employee (the problem)
Consequences of that action or behavior on the employee’s overall work performance and/or the operation of the employee’s work unit
Prior discussion(s) with the employee about the problem
Disciplinary action to be taken and the improvements expected should be documented

Inclusions in the Documentation

Consequences of failing to make the improvements by a certain follow-up date
Employee’s reaction to the supervisor’s attempt to change his or her behavior
Names of witnesses to the incident (if applicable)

Investigative Interview

Should be conducted to make sure the employee is fully aware of the organization’s rules and he or she has not followed them
Should concentrate on how the offense violated the performance and behavior standards expected
Employee must be given a full opportunity to explain his or her side of the issue
Employees do not have the right to have an attorney present during an investigative interview

Progressive Discipline

Application of corrective measures by increasing degrees
When applied properly, employees:
Always know where they stand regarding offenses
Know what improvement is expected of them
Understand what will happen next if improvement is not made

Positive or Nonpunitive Discipline

System that focuses on early correction of employee misconduct, with the employee taking total responsibility for correcting the problem
Implementation
Conference between the employee and the supervisor to find a solution to the problem
Second conference to determine why the solution agreed to in the first conference did not work
One-day decision-making leave given to the employee to decide whether he or she wishes to continue working

Discharging Employees

Have to be undertaken only after a deliberate and thoughtful review of the situation
In cases of lack of fair treatment by management, an employee has a right to file wrongful discharge suit
Discharge guidelines are applied to determine if a firm had a just cause for termination

Figure 13.9 – Just Cause Discharge Guidelines

Informing the Employee

Employee must be informed honestly and tactfully of the exact reasons for the action
Helps the employee face the problem and adjust to the termination in a constructive way
Termination meetings should be held in a neutral location to prevent the employee from feeling unfairly treated
Termination details of the employee should be kept confidential

Due Process

Procedures that constitute fair treatment, such as allowing an employee to tell his or her story about an alleged infraction and defend against it
Ensures that a full and fair investigation of employee misconduct occurs
Provided through the employer’s appeals procedure

Alternative Dispute Resolution (ADR)

Term applied to different employee complaint or dispute resolution methods that do not involve going to court
Used in nonunion organizations
ADR agreements are signed by employees when they receive their offer letters or handbooks
Must be fair and equitable to employees and employers

Step-Review System

System of reviewing employee complaints and disputes by successively higher levels of management
Managers are required to provide a full response to the complaint within a specified time period
Employee is allowed to bypass meeting if he or she fears reprisal
Decision is not appealable

Peer-Review System

System of reviewing employee complaints that utilizes a group composed of equal numbers of employee representatives and management appointees
Group weighs evidence, considers arguments and, after deliberation, votes to render a final decision
Sole method for resolving employee complaints, or in conjunction with step-review system
Benefit – Creates a sense of justice among employees

Open-Door Policy

Settles grievances that identifies various levels of management above the immediate supervisor for employee contact
Problems
Managers do not like to listen honestly to employee complaints
Fails to guarantee consistent decision making
Lacks credibility with employees
Working out grievances with immediate supervisors can make open-door policy work better

Ombudsman System

Ombudsman: Designated individual from whom employees may seek counsel for resolution of their complaints
Listens to an employee’s complaint and attempts to resolve it by seeking an equitable solution
Works cooperatively with both sides to reach a settlement
Must be able to operate in an atmosphere of confidentiality

Mediation and Mediator

Mediation: Use of an impartial neutral to reach a compromise decision in employment disputes
Flexible process that can be shaped to meet the demands of the parties
Mediator: Third party in an employment dispute who meets with one party and then the other in order to suggest compromise solutions
Fact finder and an open channel of communication between the parties
Have no authority to force either side toward an agreement

Arbitration

System in which employee and employer present their cases to an arbiter and then he or she makes a decision that the parties have agreed to be bound by
Arbiter – Retired judge
Resolves discrimination suits related to
Age
Gender
Sexual harassment
Race

Managerial Ethics in Employee Relations

Ethics: Set of standards of conduct and moral judgments that help to determine right and wrong behavior
Focus attention on an organization’s ethical values
Provide basis for managers to evaluate plans and actions
Goals of ethics training
Avoid unethical behavior and adverse publicity
Gain strategic advantage
Treat employees in a fair and equitable manner

Learning Outcomes

Reflect upon reasons that employees join unions
Describe the process by which unions organize employees and gain recognition as their bargaining agent
Outline the challenges faced by HR managers when union representation is voted into a company
Discuss the bargaining process and the bargaining goals and strategies of a union and an employer
Describe a typical union grievance procedure and explain the basis for arbitration awards

Labor Relations Process

Workers desire collective representation
Union begins its organizing campaign
National Labor Relations Board (NLRB) representation process begins
NLRB: Agency responsible for administering and enforcing the Wagner Act
Collective negotiations lead to a contract
Contract is administered

Figure 14.1 – The Labor Relations Process

Why Employees Unionize

Union shop: Provision of the labor agreement that requires employees to join the union as a requirement for their employment
Primary reasons
Economic needs – Dissatisfaction with wages, benefits, and working conditions
Dissatisfaction with management – Managerial practices regarding promotion, transfer, shift assignment, or other job-related policies are administered in an unfair or biased manner

Why Employees Unionize

Social and leadership concerns – Employees whose needs for recognition and social affiliation are being frustrated
Union steward: Employee who as a non paid union official represents the interests of members in their relations with management

Union Avoidance Practices

Pay
Promote more employees from within
Conduct cultural audits
Offer job rotations and training programs
Share information with employees
Have desirable working conditions

Organizing Steps

Employee/union contact
Employees and union officials meet up to explore the possibility of unionization
Initial organizational meeting
To identify employees who can help the organizer direct the campaign
To establish communication chains that reach all employees

Organizing Steps

Formation of in-house organizing committee
Authorization card: Statement signed by an employee authorizing a union to act as a representative of the employee for purposes of collective bargaining
Election petition and voting preparation
Organizer seeks a government-sponsored election filing representation petition with the NLRB
Contract negotiations
Represent struggle between the union and employer

Aggressive Organizing Tactics

Political involvement
Neutrality agreements
Organizer training
Corporate campaigns
Information technology

Employer Tactics Opposing Unionization

Stressing favorable employer-employee relationship experienced without a union
Emphasize current advantages in wages, benefits, or working conditions the employees enjoy
Emphasize unfavorable aspects of unionism
Strikes, payment of union dues, and special assessments
Initiate legal action when union members and leaders engage in unfair labor practices

How Employees Become Unionized

Bargaining unit: Group of two or more employees who share common employment interests and conditions and may reasonably be grouped together for purposes of collective bargaining
In disputes, the NLRB determines appropriate bargaining unit on the basis of a similarity of interests among employees within the unit

NLRB Representation Election

Pre-election hearing
Held prior to the election with the employer and union seeking to represent the employees
Important issues
Verification of the authorization cards
NLRB’s jurisdiction to hold the election
Determination of the bargaining unit
Date of the election and the voting choice(s) to appear on the ballot

NLRB Representation Election

If union wins the majority of votes in the election
NLRB certifies the union as the exclusive bargaining unit representative with which the employer must bargain
Exclusive representation: Legal right and responsibility of the union to represent all bargaining unit members equally, regardless of whether employees join the union or not

Types of Unions

Craft unions: Represent skilled craft workers
Industrial unions: Represent all workers employed along industry lines
Employee associations: Represent various groups of professional and white-collar employees in labor-management relations

Public Unions

Differences between public and private sector collective bargaining
No national boards governing public sector labor relations
Public sector collective bargaining falls within the separate jurisdiction of each state
Diversity exists among the various state laws

Impact of Unionization on Managers

Wages and benefits are higher in union organizations compared to similar nonunion organizations
Unions have a significant effect on the prerogatives exercised by management in making decisions about employees
Unionization restricts the freedom of management to formulate HR policy unilaterally and challenges the authority of supervisors

Bargaining Process

Collective bargaining process: Negotiating a labor agreement, including the use of economic pressures by both parties
Preparing for negotiations
Includes assembling data to support bargaining proposals and forming the bargaining team
Gathering bargaining data
Economic data are gathered in the areas of wages and benefits

Bargaining Process

Internal data relating to grievances, disciplinary actions, transfers, promotions, overtime, and former arbitration awards are useful in formulating and supporting the employer’s bargaining position
Employer’s bargaining strategies and tactics
Union proposals and management responses to them
Listing of management demands, limits of concessions, and anticipated union responses
Development of a database to support management bargaining proposals and to counteract union demands
Contingency operating plan should employees strike

Bargaining Process

Negotiating the labor agreement
Bargaining zone: Area in which the union and the employer are willing to concede when bargaining
Good faith bargaining
Requires meetings to be held at reasonable times and places to discuss employment conditions
Requires that the proposals submitted by each party be realistic
Both parties must sign the written document containing the agreement reached through negotiations

Bargaining Process

Categories
Mandatory subject
Permissive subjects
Illegal subjects
Interest-based bargaining
Problem-solving bargaining based on a win-win philosophy and the development of a positive long-term relationship

Figure 14.2 – Bargaining Zone and Negotiation Influences

Management and Union Power in Collective Bargaining

Bargaining power: Power of labor and management to achieve their goals through economic, social, or political influence
Union bargaining power
Exercised by striking, picketing, or boycotting the employer’s products or services

Management and Union Power in Collective Bargaining

Management bargaining power
Hiring permanent replacement workers
Continuing operations staffed by management
Locking out employees
Resolving bargaining deadlocks
Unions and employers uses mediation and arbitration to resolve their bargaining deadlocks
Mediation – Voluntary process that relies on the communication and persuasive skills of a mediator
Arbitrator: Third-party neutral who resolves a labor dispute by issuing a final decision in disagreement

Labor Agreement

Formal binding document listing the terms, conditions, and rules under which employees and managers agree to operate
Issue of management rights
Management rights clause – Management’s authority is supreme in all matters except
Ones expressly conceded in the collective agreement
Areas where its authority is restricted by law

Labor Agreement

Union security agreements: Where an employer and the union agree on the extent to which the union may compel employees to join the union and how the dues will be collected
Union shop – Provides that any employee who is not a union member upon employment must join the union within thirty days or be terminated
Agency shop – Provides for voluntary membership

Figure 14.3 – Collective Bargaining Process

Administration of the Labor Agreement

Bulk of labor relations activity comes from daily administration of the agreement
No agreement could possibly anticipate all the forms that dispute takes
On signing the agreement, each side interprets ambiguous clauses to its own advantage
Differences are traditionally resolved through the grievance procedure

Negotiated Grievance Procedures

Grievance procedure: Formal procedure that provides for the union to represent members and nonmembers in processing a grievance
Grievance mediation
Way to resolve employee grievances
Listed as a formal step in the grievance procedure preceding arbitration

Figure 14.4 – Five-Step Grievance Procedure

Grievance Arbitration

Rights arbitration
Arbitration over interpretation of the meaning of contract terms or employee work grievances
Fair representation doctrine
Unions have a legal obligation to provide assistance to both members and nonmembers in labor relations matters
Submission agreement
Statement of the problem to be resolved

Arbitration Award

Formal written document given to both sides
Parts
Submission agreement
Facts of the case
Positions of the parties
Opinion of the arbitrator
Decision rendered

Factors Used in Deciding Cases

Wording of the labor agreement
Submission agreement as presented to the arbitrator
Testimony and evidence offered during the hearing
Arbitration criteria against which cases are judged

Contemporary Challenges to
Labor Organizations

Reasons for decrease in union membership
Shift from traditional unionized industries to high technology industries
Growth in the employment of part-time and temporary workers
Growth in small businesses, in which unionization is more costly and difficult to perform
Globalization of the workforce particularly among low wage employers

Contemporary Challenges to
Labor Organizations

Globalization and technological change
Offshoring: Work that was previously carried out in one country is moved to another country
Employers need to pay more attention to the relevant stakeholders such as unions, employees and communities in which they operate
Job loss in America is not due to offshoring, but rather due to technological changes

Learning Outcomes

Explain the political, economic, socio-cultural, and technological factors in different countries that HR managers need to consider
Identify the types of organizational forms used for
competing internationally
Explain how domestic and international HRM differ. Discuss the recruitment, selection, training, compensation, and performance appraisal needs for different types of employees working across borders
Explain how labor relations differ around the world

Introduction

Managing human resources across these international settings:
Leverage specialized skills
Provide cheaper labor
New ideas into the company
Issues in international HRM in helping employees adapt to a new and different environment outside their own country
Relocation
Orientation
Translation services

Analyzing Your International Environment

PEST (political, economic, socio-cultural, and technological) analysis
Audit of a company’s environmental influences to help them determine their strategy and HR response
PEST analysis can help you to:
Spot business or personnel opportunities
Spot trends in the business environment

Analyzing Your International Environment

Avoid implementing HR practices in a particular country where they can fail
Break free of old habits and assumptions about how people should be managed to help bring about innovative ideas for the entire company
Host country: Country in which an international corporation operates

Figure 15.1 – PEST Analysis

Analyzing Your International Operations

Figure 15.2 – Types of Organizations

Managing Your International Operations

Figure 15.3 – Changes in International Staffing over Time

Recruiting Internationally

Core criteria that are viewed as essential in worldwide recruiting efforts
Personal integrity
Drive for results
Respect for others
Capability
Virtually all countries have work permit or visa restrictions that apply to foreigners

Recruiting Internationally

Selecting Employees Internationally

Selecting employees in a foreign country environment can be difficult
Get to know the local market and customs in hiring
To understand local markets, HR managers can
Get to know the universities, technical schools, and primary schools in the area
Develop network in the business and government communities
Understand the employees of the firm’s competitors

Selecting Global Managers

Global manager: Manager equipped to run an international business
Skills required for global managers
Ability to seize strategic opportunities
Ability to manage highly decentralized organizations
Awareness of global issues
Sensitivity to issues of diversity
Competence in interpersonal relations
Community-building skills

Selecting Global Managers

Cultural environment: Communications, religion, values and ideologies, education, and social structure of a country
Core skills: Skills considered critical to an employee’s
success abroad
Augmented skills: Skills helpful in facilitating the efforts of expatriate managers

Selecting Global Managers

Steps involved in selecting individuals for an international assignment
Begin with self-selection
Create a candidate pool
Assess candidates’ core skills
Assess candidates’ augmented skills and attributes
Companies that have selected the best candidates experience high expatriate failure rates
Failure rate: Percentage of expatriates who do not perform satisfactorily

Figure 15.5 – Causes of Expatriate Assignment Failure

Figure 15.6 – Expatriate Adjustment Factors

Training and Development

When employees are sent aboard for an assignment, it is critical to provide them with training
Companies have found that good training programs help them attract the employees they need from host countries

Content of Training Programs

Employees working internationally need to know the:
Country where they are going
Country’s culture
History, values, and dynamics of their own organizations
Sensitivity training can help expatriates overcome ethnic prejudices

Figure 15.7 – Preparing for an International Assignment

Content of Training Programs

Essential training program content
Language training
Cultural training
Assessing and tracking career development
Managing personal and family life
Repatriation

Language Training

English is universally accepted as the primary language for international business
Designated language for meetings and formal discourse
Learning the language is only part of communicating in another culture

Cultural Training

Each culture has its expectations for the roles of managers and employees
Studying cultural differences can help managers identify and understand work attitudes and motivation in other cultures

Advantages of an International Assignment

Increase a person’s responsibilities and influence within the corporation
Provides a set of unique experiences beneficial to
both the individual and the firm
Enhances understanding of the global marketplace
Offers the opportunity to work on a project important
to the organization

Figure 15.9 – Selected Foreign-Born Executives

Managing Personal and Family Life

Culture shock: Perpetual stress experienced by people who settle overseas
Employers offer to accommodate dual-career partnerships such as
Spouses career and life planning counseling
Continuing education
Intercompany networks to identify job openings in other companies
Job-hunting/fact-finding trips
Help securing work permits abroad

Repatriation

Process of transition for an employee home from an international assignment
Designed to prepare employees for adjusting to life at home
Employees are given guidance about how much the expatriate experience have changed them and their families

Compensation

Different countries have different norms for
employee compensation
Financial incentives versus nonfinancial incentives
Individual rewards versus collectivist concerns for internal equity and personal needs
General rule
Create a pay plan that supports the overall strategic intent of the organization

Compensation of Host-Country Employees

Hourly wages can vary from country
to country
Paid on the basis of:
Productivity
Time spent on the job
Combination of these factors
Employee benefits can range from country to country

Compensation of Host-Country Managers

Global compensation system
Centralized pay system whereby host-country employees are offered a full range of:
Training programs
Benefits
Pay comparable with a firm’s domestic employees
Companies with centralized systems are having higher effectiveness and satisfaction levels with their compensation systems

Compensation of Expatriate Managers

Effective international compensation program must:

Provide an incentive to leave the United States

Allow for maintaining an American standard of living

Provide for security in countries that are politically unstable or present personal dangers

Include provisions for good health care

Reimburse the foreign taxes the employee is likely to have to pay and help him or her with tax forms and filing

Compensation of Expatriate Managers

Provide for the education of the employee’s children abroad, if necessary

Allow for maintaining relationships with family, friends, and business associates via trips home and other communication technologies

Facilitate the expatriate’s reentry home

Be in writing

Compensation of Expatriate Managers

Home-based pay: Based on an expatriate’s home country’s compensation practices
Balance-sheet approach: Compensation system designed to match the purchasing power in a person’s home country
Calculate base pay
Figure cost-of-living allowance (COLA)
Add incentive premiums
Add assistance programs

Compensation of Expatriate Managers

Split pay: System whereby expatriates are given a portion of the pay in the local currency to cover the day-to-day expenses
Portion of the pay in the home currency to safeguard the earnings from changes in inflation or foreign exchange rates
Host-based pay: Expatriate pay is comparable to that earned by employees in a host country to which the expatriate is assigned

Compensation of Expatriate Managers

Localization: Adapting pay and other compensation benefits to match that of a particular country
Reduces resentment among local staff members
if they are earning significantly less
Other issues
Adequacy of medical care
Personal security
Compensation policies of competitors

Performance Appraisal

Appraisal of employee’s performance
Home-country evaluations
Host-country evaluations
Home versus host-country evaluations
Local managers with daily contact with the person are to have an accurate picture of his or her performance

Performance Appraisal

Performance criteria
Steps related to calculating the ROI of an assignment

Defining the assignment’s objectives

Agreeing on the quantifiable measurements for the assignment

Developing an equation that converts qualitative behavior into quantifiable measurements

Evaluating the expatriate’s performance against these measurements

Calculating the ROI

Performance Appraisal

Providing feedback

Purpose of repatriation interviews

Help expatriates reestablish old ties with the home organization

Address technical issues related to the job assignment itself

Address general issues regarding the company’s overseas commitments

Very useful for documenting insights an individual has about the region

Analyzing the International Labor Environment

Factors of union strength
Level of employee participation
Per capita labor income
Mobility between management and labor
Homogeneity of labor (racial, religious, social class)
Unemployment levels
Companies are increasingly giving offshore jobs to countries where labor costs are lower, unionized workers have been forced to make concessions

Collective Bargaining in Other Countries

When we look at other countries, process can vary widely, with regard to the role of government
Collective bargaining can take place at the firm, local, or national levels
Government involvement is only natural where parts of industry are nationalized

International Labor Organizations

International Trade Union Confederation (ITUC) – Active of the international union organizations
Headquarters in Brussels
International Labour Organization (ILO) – Specialized agency of the United Nations created in 1919

Labor Participation in Management

In European countries, provisions for employee representation are established by law
Codetermination: Representation of labor on the board of directors of a company
Power is with the shareholders who are assured the chairmanship

3 Discussions and 2 weekly summary

Discussion 7.1

Discussion 7.2

Discussion 8.1

Weekly Summary 7.1 (Chapter 13 and 14 )

Weekly Summary 8.1 ( Chapter 15 and 15)

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Exp19_Excel_Ch02_Cap_Appliances

Discussion 6- Planning

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Problem 7- Legal

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Discussion 7.1

Discussion 7.2

Discussion 8.1

Weekly Summary 7.1 (Chapter 13 and 14 )

Weekly Summary 8.1 ( Chapter 15 and 15)

Having Trouble Meeting Your Deadline?

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