Cross cultural issues in hr
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By: Praful Anchaliya
Cross Cultural Issues in HRMISL chapterHandling the cross-cultural issues within the organization
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Praful Anchaliya
Multi-cultural aspects in HR Human Resource Policies
Work Culture Impact
Mix of the top-tier management
Relations with umbrella organization
Working-population Mix
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Praful Anchaliya
Aspects –
HR Policies
Working Days, Working Hours, Leaves & Holidays
Conglomerate design & structure
Manpower cost/planning/hiring/induction
Benefits management & compensation
Performance & Potential Management
Expatriation in & out
PF & miscellaneous fund raising
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Praful Anchaliya
Aspects –
Work Culture of the organization
Multinational – USA/India/UAE/Japanese/Korean/European
Core Values, key policies, management style
System, Processes & Work Practices
Joint Venture or chained
Code of Conduct▪ Formal▪ Informal
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Praful Anchaliya
Aspects –
Mix in Top-Management
American+Indian
Britisher+Arab National+Indian
Japanese+Indian
American+Korean+Indian
All Expats
All Indians
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Praful Anchaliya
Aspects –
Relation to the umbrella organization
In case of joint venture, MNC or 100% owned susidary
Influence of company vision, core values, company work culture & top leadership style
Related Impact on business strategy & plan and its link to HR strategy: Work Culture, HR Policies & Work life
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Praful Anchaliya
Aspects –
Employee population mix
Within India business situation
Outside India business situation
Social & cultural habits
Foods & Etiquettes
Management & leadership style
Adaptation to alien-context – culture - working
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Praful Anchaliya
Some real issues:
Work Culture
Tendency of parent company in case of MNCs to have same work culture in an overseas company
Disconnect between umbrella company culture & local context. Eg: Indian Subsidiary
Misunderstanding due to lack of sensitization of local & social structure & cultural context
Impact of blue collar workers – unions
Morale, motivation, ownership & commitment of the work force
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Praful Anchaliya
Some real issues:
Compensation & Benefits Relatively low annual salary increase compared to
Indian Context Simple & compact salary structure without any
consideration to tax savings etc. High focus on variable Pay & bonuses and cash element
rather than fixed salary & long term benefits Clear link of individual performance to variable pay &
annual salary review Strong link of financial performance of the company to
define variable pay & salary decision
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Praful Anchaliya
Some real issues:
Job Security – People Orientation Relocation, No increase, salary cut, pink slips,
bench or downsizing in case of:▪ Economic downturn▪ Acquisitions & Mergers of companies▪ Non-performance of employee▪ In case of restructuring▪ In case of closure of business-plants/locations
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Praful Anchaliya
Handling Multi-cultural teams Respect for each-other
Inter-personal relations
Initiative & Adaptability
Understanding of unique cultural context
Equal participation
Ability of sensitive listening
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Praful Anchaliya
The MISL Chapter
At Maruti Suzuki India Ltd. Please elaborate with basic structure @ Maruti.
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Praful Anchaliya
Glimpse of 25 years
Phase-I
•1983- SMC(24%), Govt. of India(76%)
•Market Dominance
•Production Orientation
•Trade Union Perspective
Phase-II
•1995-SMC(50%, Govt. of India (50%)
•Prod., M&S & People perspective
•Initialization of competition
•Customer Orientation
Phase-III
•2008-SMC(54.2%), Listed in Stock Market
•Intense Competition
•Emphasis on Engineering Capability
•Market orientation & talent perspective
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Praful Anchaliya
Multi-cultural part
MISL is a classy example of balanced mix of Indian & Japanese culture in management styles:
Japanese
• Long-term & detailed process• Long-term employment
relationship• High Orientation to
system/work practices• Strong character &
commitment• Budget Process-Cost
savings/reduction• Slowly/Lengthy Decision
Making• Focus on Micro-business
process
Indian
• Rich in tradition & culture• High emotional quotient • High versatility-adaptability• Job Security• Orientation towards
participative style• High sense of belongingness• Company & family connect
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Praful Anchaliya
Conglomerate structure
Evolved a process of “Paired Leadership Model”
Introduction of “Managing Executive Officer System” with focus on: Policy Formulation & Key Decisions at board level Execution of Key Policies & Decisions in day to day operations
Benefits of New organizational structure: Improved clarity & focus on key management responsibilities Harmonization, leading to reduced compartmentalization Improved coordination across the functions Improved speed in decision making Development & career enhancement process of Indian
Professionals
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Praful Anchaliya
MISL’s training interventions A well defined training module has been initiated at middle & senior
management level to: Strengthen the bond Address multi-cultural issues related to both Japanese & Indian employees
The training program has been initiated with focus on: Creating team synergy Promoting culture of innovation Enhancing risk taking abilities Developing cultural sensitivity
Language training has been brought in to bridge the language barrier; Specialized interpreters have been roped in to facilitate better understanding
Effective communication across the company on regular basis across all levels divison
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Praful Anchaliya
HR Ground Realities: Indian Context
HRM, is strongly influenced by: Local Culture Social Norms Local beliefs & practices
Frequent failure of some MNCs: A common mistake: overlooking the local ground realities under the
unconscious bias of their parent Corporate Culture, Policies & Practices
People management in India or any other alien overseas operation cannot be successful managed in any “Japanese” or “American” or “Korean” or “Arab” or “European” way
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Praful Anchaliya
HR Ground realities: Indian Context
HR Policies, system & practices based on the culture & core values of the parent company may or may not work in the Indian Context
Key to success lies in embracing flexibility, understanding, acceptance, respect & adaptability to the local ground realities
Collaborative process of gradual change through trust, mutual exchange, training & flexible management approach can help in establishing a strong link & facilitate desired results
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Praful Anchaliya
HR Ground realities: Indian Context
Maruti is the most successful & live example of such business success in India – The Suzuki Way – credit to Chairman O. Suzuki & the SMC Top Management Team.
The team Govt. thus decorated Chairman O. Suzuki with – PADMA VIBHUSHAN – the highest Indian honor in year 2007
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Praful Anchaliya
Concluding…
Managing multi-cultural initiatives help an Organization keep a competitive HR advantage through: Improved corporate culture
Improved employee morale & higher retention of employee
Enabling the organization to move into emerging markets
Decreased interpersonal conflict among employees
Increased productivity, innovation & brand identity
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Praful Anchaliya
Concluding…
Developing a Global
Corporate
A Global Culture
Global People &
talent potential