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HRM ISSUES IN CHINABy,Shilpa Susan PhilipKinshoo ShahRavi Teja6/17/2010

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Contents

• US Expatriate Failure in China• Issue Under Focus• Trend• Cross Cultural Analysis• Glimpses of Chinese Culture• Proposed IHRM Strategy & Model• Benefits -Cross Cultural Training For Expatriate• Implications for the Firm• Conclusion• Reference6/17/2010

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Reason for US Expatriate Failure In

China6/17/2010

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• Negotiation & Communication Issues• Cross Cultural Diversity Issues• Behavioral & Working Style Adjustment

Issues• Language Barriers• Life Style Issues• Ethical Issues in Business

Few Issues Faced

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Issue Under Focus

Managing US Expatriate Failure Due To

Cross Cultural Diversity Issues

In China

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US - Cross Cultural Training Trend

Trained Prior To Departure –32 % [Tung, 1982, P55-56].

68% Sent Without Training

[Tung, 1982, P.66].

10- 40% US Expatriate Failure In China

Statistics referenced from AIB-SE (USA) 2010 Annual Meeting report6/17/2010

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US & China- Cross Cultural Analysis(Hofstede Model)

0

20

40

60

80

100

120

China World USSource of statistics research:www.customerthink.com

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Do not use large hand

movements.

Personal contact must be avoided at

all cost

It is illegal to give gifts to government

official

You should taste all the

dishes you are offered.

Source: http://www.cyborlink.com/besite/china.htm

Punctuality is a key.

Tipping is considered insulting.

Bowing or nodding is the

common greeting.

Use formal titles.

Snap decisions are considered an

insult

Chinese value rank and status.

Looking in the eye while addressing is

considered as lack of confidence.

Preference to local language

Glimpses of Chinese culture

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Process flow - Identifying HRM Strategy

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KTS-IHRM StrategyFor

Cross Cultural Diversity Management

(Developed By Shilpa, Kinshoo, Teja)

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Strategy (Developed by Shilpa, Kinshoo, Teja)

• .

Review

current expatriate practices.

Identify the expatriate success/failure rates

Identify the sources of expatriates success/failure

Expatriate audit ,

Cultural diversity audit

Refine expatriate selection procedures

Identify duration of assignment

Provide cross-cultural training

Inform in advance about the cross-cultural Complexities likely to be faced before deciding to relocate overseas.

Conduct destination-specific briefing.

Consider basic language training.

Provide in-country support.

Feed Back & evaluation

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Ap

pro

ac h

Bas

ed

O

n

Du

rat

io n6/17/2010

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KTS-IHRM Modelfor

Cross Cultural Diversity Management

(Developed by Shilpa, Kinshoo, Teja)6/17/2010

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Self referencingPersonalityFlexibilityExposure levelsCommunication skill LanguageTraining & PerceptionsWillingness to acculturatePersonal aspects

Reasons for previous failuresEvaluate current practicesCross Cultural style differencesSoft skill requirementsCommunication skill requirementsPerception of culture distanceType of training being providedDuration of assignment

•Experimental(intercultural skill) •Cultural assimilator•Cognitive •(Cultural awareness & interpersonal Skill)•Social Skill

Situational Aspects

Managing Cross Cultural

Diversity Individual Aspects

Cross Cultural Diversity Analysis

Cross CulturalBusiness

Expectations of Host Country

Host Aspects

Acculturated Individuals

CCT program

OUTCOME

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What All CCT Shall Address

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CCT Program

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Concepts Skills KnowledgeCulture -important part of identity.

Chinese language proficiency - able to negotiate & speaking practices.

Knowledge of different cultural aspects.

Communication of cultural •Ability to communicate an understanding of culture•Respect the culture•Strengthens relationship.•Face directed Communication strategies

Knowledge of behavioral aspects of different cultures, appearance parameters, business etiquettes etc.

Cultural Values & beliefs affect understanding & acceptance.

Ability to recognize culture related business problems.

Knowledge of the effect of religion on business.

Training Program

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Concepts Skills Knowledge

Non-verbal & verbal communications

Ability to interpret employee’s verbal & non-verbal behaviors in a culturally relevant manner.

• Implicit communication• More of a listener•Focus on insiders

Knowledge of the significance of common verbal and nonverbal communications of different cultures & speaking practices.

Culture –related stress affects efficiency.

Possess the social skills & elicit the employee’s understanding of business problem.

Knowledge of symptoms of “culture shock syndrome”.

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Benefits of Cross Cultural Training US Expatriate

Ability to Communicate With Respect

To Be Non Judgmental

Reduce Self- Referencing

Tolerance For Ambiguity

Reduces Uncertainty Of Interactions

Display Cultural

Empathy Become More

Flexible

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Implications for the US Firm

1. Reduced stress & cross cultural shock

2. Build new strategic alliances.

3. Superior International Performers

4. Enhance business relationships

1. Expensive

ProsCons

5. Reduced Failures & Costs

6. Increase Employee retention.

7. Enhanced foreign negotiation

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Conclusion

Its high time for US MNC’s to provide its CCT to all its

Expatriates & not just to 32%, in order to:-

Adoption and implementation of KTS- IHRM Strategy

& Model shall help:-

• Better management of cross cultural diversity issue.• Bring down the expatriate failure’s from 40% • Obtain greater managerial effectiveness.

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Reference

• Lua, Karel(2001),Expatriatiate management :Business model for cultural diversity.

• Adler, Nancy, 1981. Re-entry: Managing cross-cultural Transitions. Group and Organization

Studies, 6, 341-356.

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THANK YOU…

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