By: Praful Anchaliya

Cross Cultural Issues in HRMISL chapterHandling the cross-cultural issues within the organization

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

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

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

Praful Anchaliya

Aspects –

Mix in Top-Management

American+Indian

Britisher+Arab National+Indian

Japanese+Indian

American+Korean+Indian

All Expats

All Indians

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

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

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

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

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

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

Praful Anchaliya

The MISL Chapter

At Maruti Suzuki India Ltd. Please elaborate with basic structure @ Maruti.

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

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

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

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

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

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

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

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

Praful Anchaliya

Concluding…

Developing a Global

Corporate

A Global Culture

Global People &

talent potential