Role of Cultural Factors in Shaping Human Resource Management
Role of Cultural Factors in Shaping Human Resource Management Practices in the Multinational Corporations (MNCs) Operating in the Emerging Markets of South Asia
ABM Abdullah*, Stephen Boyle** and Carmen Joham***
A number of studies have been conducted for addressing the issues related to cultural diversity of employees working for Multinational Corporations (MNCs) operating in South Asian countries. However, only a few of the studies have looked into the issues related to how culture plays a role in shaping key Human Resource(HR) practices such as: compensation policy, job security, training and development, selection and recruitment, decentralization and teamwork, and information sharing in the South Asian context. In this paper, Hosftede’s (1980) culture dimensions are used as a lens to explore the relationship between critical HR practices and Bangladeshi employees. Identification of these critical practices should help the MNCs’ top management when managing their workforce in Bangladesh or other South Asian countries with a similar cultural orientation. Various propositions are made in this paper and it is suggested that they would be useful as a framework for future studies in similar settings.
Keywords: Cultural diversity, culture dimensions, workforce management
_
* ABM Abdullah, School of Management, City West Campus (EM -434), University of South Australia, PO Box – 2471, Adelaide, SA 5001, Australia Email: abm.abdullah@unisa.edu.au
** Stephen Boyle, School of Management, City West Campus (EM -235), University of South Australia, PO Box – 2471, Adelaide, SA 5001, Australia Email: stephen.boyle@unisa.edu.au
*** Carmen Joham, School of Management, City West Campus (EM -427A), University of South Australia, PO Box – 2471, Adelaide, SA 5001, Australia Email: carmen.joham@unisa.edu.au Introduction
For the last two decades, tremendous developments
ABM Abdullah*, Stephen Boyle** and Carmen Joham***
A number of studies have been conducted for addressing the issues related to cultural diversity of employees working for Multinational Corporations (MNCs) operating in South Asian countries. However, only a few of the studies have looked into the issues related to how culture plays a role in shaping key Human Resource(HR) practices such as: compensation policy, job security, training and development, selection and recruitment, decentralization and teamwork, and information sharing in the South Asian context. In this paper, Hosftede’s (1980) culture dimensions are used as a lens to explore the relationship between critical HR practices and Bangladeshi employees. Identification of these critical practices should help the MNCs’ top management when managing their workforce in Bangladesh or other South Asian countries with a similar cultural orientation. Various propositions are made in this paper and it is suggested that they would be useful as a framework for future studies in similar settings.
Keywords: Cultural diversity, culture dimensions, workforce management
_
* ABM Abdullah, School of Management, City West Campus (EM -434), University of South Australia, PO Box – 2471, Adelaide, SA 5001, Australia Email: abm.abdullah@unisa.edu.au
** Stephen Boyle, School of Management, City West Campus (EM -235), University of South Australia, PO Box – 2471, Adelaide, SA 5001, Australia Email: stephen.boyle@unisa.edu.au
*** Carmen Joham, School of Management, City West Campus (EM -427A), University of South Australia, PO Box – 2471, Adelaide, SA 5001, Australia Email: carmen.joham@unisa.edu.au Introduction
For the last two decades, tremendous developments
References: Ahmad, S. & Schroeder, R.G. (2003). The Impact of Human Resource Management Practices on Operational Performance: Recognizing Country and Industry Differences. Journal of Operations Management, 21, 19 – 43. Aycan, Z. (2005). The interplay between cultural and institutional/structural contingencies in human resource management practices, International Journal of Human Resource Management, 16 (7), 1083 – 1119. Bjorkman, I. & Xiucheng, F.(2002). Human resource management and the performance of W estern firms in China. International Journal of Human Resource Management. Board of Investment (BOI) Handbook, 2007 Boxall, P Cardon, M.S. & Stevens, C.E. (2004). Managing Human Resources in Small Organizations: W hat Do W e Know? Human Resource Management Review, 14, 295 Child, J. (1981). Culture, Contingency and Capitalism in the Cross -National Study of Organizations. In Cummings, L.L. and Staw, B.M. (eds) Research in Organizational Behavior, Greenwich, CT: JAI Press, 3, 303 – 356. Chilton, K. (1993). Lincoln Electric‟s incentive system: Can it be transferred overseas? Compensation and Benefits Review, 25(6), 21-30 Daft, R. (1997). Management. New York: Dryden. Friedman, B. A. (2007). Globalization Implications for Human Resource Management Roles, Employee Respons Rights Journal, 19, 157-171. Grant, R. M. (1996). Prospering in Dynamically-competitive Environments: Organizational Capability as Knowledge Integration. Organization Science, 7(4), 375 – 389. Gupta, A. K. & Govindarajan, V. (2001). Converting Global Presence into Competitive Advantage Hofstede, G. (1980). Culture’s Consequences: International Differences in Work-related Values Hofstede, G. (1984). Cultural Dimensions in Management and Planning. Asia Pacific Journal of Management, 6(1), 81 – 99. Hofstede, G. (1993). Cultural Constraints in Management Theories. Academy of Management Executive, 7(1), 81 – 93. Huselid, M. A. (1995). The Impact of Human Resource Management Practices on Turnover, Productivity and Corporate Financial Performance. Academy of Management Journal, 38(3), 635–672. http://www.bangladesh.com Investor Chronicle (IC) Report, 2008 Jackson, S. E. & Schuler, R. S. (1995). Understanding Human Resource Management in the Contxt of Organisations and their Environments. Annual Review of Psychology, 46, 237-264. Jaeger, A. F. & Kanungo, R. N. (eds) (1990). Management in Developing Countries. Kanungo, R. M. & Jaeger, A. F. (1990). Introduction: The Need for Indigenous Management in Developing Countries. In Jaeger, A.F. & Kanungo, R.N. (eds) Management in Developing Countries. London: Routledge, 1–23. Kluckhohn, C. (1951). Values and Value-Orientations in the Theory of Action: An Exploration in Definition and Classification. In Parsons, T. and Shils, E. A. (eds) Toward a General Theory of Action, Cambridge, MA: Harvard University Press. Kaya, N. (2006). The impact of human resource management practices and corporate entrepreneurship on firm performance: evidence of Turkish firms. International Journal of Human Resource Management, 17(12), 2074–2090. Nohria, N., Groysberg, B. & Lee, L. (2008). Employee Motivation: A Powerful New Model Peteraf, M. A. (1993). The Cornerstones of Competitive Advantage: A Resource Based View Pfeffer, J. (1998). The Human Equation. Boston, MA: Harvard Business School Press. Sparrow, P. and W u, P.C. (1998). Does National Culture Really Matter? Predicting HRM Preferences of Taiwanese Employees Sparrow, P. R. & Budhwar, P. S. (1997). Competition and Change: Mapping the Indian HRM Recipe against W orld-wide Patterns Taplin, I. M. & Frege, C. M. (1999). Managing Transitions: The Reorganization of Two Clothing Manufacturing Firms in Hungary traits: The management of people in Brazilian companies. International Journal of Human Resource Management, 16(12), 2201–2217. Tayeb, H. (1998). The management of multicultural workforce, university of Edinburgh, England. Tayeb, M. (1995)(1). Organisations and National Culture: Methodology Consideration. Thomas, D. C. (2002). Essentials of international Management. USA.: Sage Publications. Uen, J. F. & Chien, S. H. (2004). Compensation Structure, Perceived Equity and Individual Performance of Rand Professionals. The Journal of American Academy of Business, 3, 401–405. Ulrich, D. & Brockbank, W . (2005). The Value Proposition. Boston: Harvard Business School Press. Vlachos, I. (2008). The effect of human resource practices on organizational performance: evidence from Greece. International Journal of Human Resource Management, 19(1), 74-97. W agner & Hollenbeck. (2005). Organizational Behavior: Securing Competitive Advantage, 5th Edition Wright, P. M., Dunford, B. B. & Snell, S. A. (2001). Human Resources and the Resource-based View of the Firm