Upload
roxana-buzetelu
View
204
Download
0
Embed Size (px)
Citation preview
Brunel Business School
MSc INTERNATIONAL BUSINESS
Academic Year 2010-2011
HRM Practices – CCSI And Its Importance In Achieving Superior Organisational Performance: A Study Of Foreign MNESs Operating In Romania
Roxana Buzetelu,
Student ID: 1033166
A report submitted in partial fulfilment of the requirement for the degree of Master of Science
Brunel University
Department of Information Systems and Computing
Uxbridge, Middlesex UB8 3PH
United Kingdom
Tel: +44 (0) 1895 203397
Fax: +44 (0) 1895 251686
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 2 Student ID:1033166
ABSTRACT
The actual business environment is the result of a continuous development and growth. In the 1980s
major important changes happened, one of the most important, being the appearance of MNEs, and
with this, the shift towards an international division of labour (Legge, 2005). Facing these changes,
companies had to adapt and develop their strategies in order to successfully compete with other
major important players on the market. Thus, it was very important to develop new ways of thinking
and acting in a multinational and complex society.
In order to achieve individual and organisational performance, companies must offer a lot of
attention to the mix of Human Resources Management practices they use. Nowadays, having in
consideration the global economical environment and the fact that citizens from different cultures
are working together, it is very important to understand any cross-‐cultural differences, and to
ensure that such differences are dealt effectively.
The aim of this research paper is to identify if the mix of HRM practices used by five multinational
enterprises operating in Romania, are successful enough. Additionally, the concept of cross cultural
social intelligence was explained and an attempt was made to highlight its importance in achieving
superior organisational performance.
Having obtained results from designed questionnaires, the findings of the present study show the
fact that even if the current mix of HRM practices adopted by companies operating in Romania leads
to organisational performance, it is recommended to improve and pay more attention to the
expatriate and employee’s needs by offering them more trainings and development programmes.
Moreover the current research paper identified the importance of CCSI in the present global
economical context.
Keywords: HRM practices, cross-‐cultural social intelligence, expatriates, organisational performance.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 3 Student ID:1033166
AKNOWLEDGEMENT Firstly, I would like to thank and show my appreciation to my tutor Mr. Mustafa F. Ozbilgin, for his
help, guidance, support and encouragement. His contribution was significant for the accomplishing
of this study.
I wish also to thank all the people that were involved in this research and more specifically all the
employees of the five MNEs that helped me with their responses.
I want also to show my love and appreciation to my family, friends and especially to my boyfriend
who never stop supporting and love me. Without their support, this study would be unattainable.
Last but not least, thank you God, for providing me all the strength and courage to complete this
project.
I certify that the work presented in the dissertation is my own unless referenced
Signature..........................................
Date.....28th September, 2011.
Total number of words: 12,311
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 4 Student ID:1033166
TABLE OF CONTENTS
ABSTRACT .............................................................................................................................................. 2
AKNOWLEDGEMENT .............................................................................................................................. 3
Chapter 1: INTRODUCTION .................................................................................................................... 8
1.1. Cross-‐cultural social intelligence ............................................................................................ 9
1.2. MNEs operating in Romania ................................................................................................. 10
1.3. Aims and objectives .............................................................................................................. 10
1.4. Research Outline ................................................................................................................... 11
Chapter 2: LITERATURE REVIEW .......................................................................................................... 13
2.1. Human resources management ........................................................................................... 13
2.2. HRM practices – HRM performance ..................................................................................... 14
2.3. HRM practices ....................................................................................................................... 15
2.3.1. Recruiting and hiring ...................................................................................................... 16
2.3.2. Training and development ............................................................................................. 17
2.4. HRM in Multinational Enterprises ........................................................................................ 17
2.5. Expatriate managers ............................................................................................................. 18
2.6. Cross-‐cultural management .................................................................................................. 20
2.6.1. Cross-‐cultural management approaches ....................................................................... 22
2.6.2. Cross-‐cultural management interaction ........................................................................ 22
2.7. Cross Cultural Social Intelligence .......................................................................................... 25
2.8. Romanian Managers and HRM ............................................................................................. 27
Chapter 3: METHODOLOGY ................................................................................................................. 29
3.1. Introduction .......................................................................................................................... 29
3.2. Research Design .................................................................................................................... 29
3.2.1. Primary Data .................................................................................................................. 30
3.2.1.1. Closed Ended Questions ......................................................................................... 30
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 5 Student ID:1033166
3.2.1.2. Open -‐ Ended Questions ......................................................................................... 32
3.2.2. Secondary Data .............................................................................................................. 32
3.3. Context and Sample of the Study ......................................................................................... 33
3.4. Ethical Issues ......................................................................................................................... 33
3.5. Limitations ............................................................................................................................ 34
Chapter 4: DATA ANALYSIS AND FINDINGS ......................................................................................... 35
4.1. Introduction .......................................................................................................................... 35
4.2. Findings – HRM Practices in MNEs ....................................................................................... 36
4.2.1. Training and development ............................................................................................. 36
4.2.2. Team work ..................................................................................................................... 37
4.2.3. Selective hiring ............................................................................................................... 37
4.2.4. Related payment ............................................................................................................ 39
4.2.5. Information sharing and participation ........................................................................... 40
4.3. Findings – CCSI and Organisational Performance ................................................................. 41
4.3.1. Cross-‐cultural Social Intelligence ................................................................................... 42
4.3.2. Organisational Performance .......................................................................................... 44
4.4. Findings – Open Questions ................................................................................................... 51
Chapter 5: DISCUSSION PART .............................................................................................................. 55
5.1. Introduction .......................................................................................................................... 55
5.2. HRM Practices ....................................................................................................................... 55
5.3. Cross-‐cultural social intelligence .......................................................................................... 57
5.4. CCSI – Performance .............................................................................................................. 57
5.5. HRM practices and CCSI in MNEs operating in Romania ...................................................... 58
Chapter 6: CONCLUSIONS .................................................................................................................... 60
6.1. Introduction .......................................................................................................................... 60
6.2. Research Findings and Recommendations ........................................................................... 60
6.3. Research contribution .......................................................................................................... 62
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 6 Student ID:1033166
6.4. Research limitations ............................................................................................................. 62
6.5. Recommendation for future research work ......................................................................... 62
LIST OF REFERENCES: ........................................................................................................................... 63
APENDIX A ........................................................................................................................................... 67
APPENDIX B ......................................................................................................................................... 68
Figure 2-‐1 ............................................................................................................................................. 15
Figure 2-‐2 ............................................................................................................................................. 24
Figure 2-‐3 ............................................................................................................................................. 25
Table 4-‐1: Response Rate .................................................................................................................... 35
Graph 4-‐1 ............................................................................................................................................. 36
Graph 4-‐2 ............................................................................................................................................. 37
Graph 4-‐3 ............................................................................................................................................. 38
Graph 4-‐4 ............................................................................................................................................. 39
Graph 4-‐5 ............................................................................................................................................. 40
Graph 4-‐6 ............................................................................................................................................. 41
Graph 4-‐7 ............................................................................................................................................. 42
Graph 4-‐8 ............................................................................................................................................. 43
Graph 4-‐9 ............................................................................................................................................. 44
Graph 4-‐10 ........................................................................................................................................... 45
Graph 4-‐11 ........................................................................................................................................... 46
Graph 4-‐12 ........................................................................................................................................... 47
Graph 4-‐13 ........................................................................................................................................... 48
Graph 4-‐14 ........................................................................................................................................... 49
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 7 Student ID:1033166
Graph 4-‐15 ........................................................................................................................................... 50
Graph 4-‐16 ........................................................................................................................................... 51
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 8 Student ID:1033166
Chapter 1: INTRODUCTION
Even if the financial crisis hit the whole world and the business environment had to suffer,
globalization is unstoppable. The economy is expanding, and businesses all around the world tend to
develop by finding new opportunities and by conquering new markets. Because of this, today’s work
force tends to be more and more diverse in race, gender, culture, family structures, religion, and
educational backgrounds. According to Bovee, Thill, Mescon (2007), managing the workforce is, at
the moment, an international challenge: different teams from different parts of the world have to
work together, and companies have to understand and coexist with their business partners.
Thus, human resources management (HRM) represents one of the most important and challenging
functions of a business. HRM includes all the tasks involved in acquiring, maintaining, and developing
an organization’s human resources (Dessler 2004). The human resource (HR) department has six
different functions: 1) planning for staffing needs, 2) recruiting and hiring, 3) training and
development, 4) appraising performance, 5) administering compensation and benefits, 6) overseeing
changes in employment status (Bovee, et al, 2007). According to Gould-‐Williams, “the more HR
practises used within the organisation, the greater the impact on performance” (Gould-‐Williams,
2003, p.43).
Due to the fact that the actual global economical environment is changing really fast, this practice
started to be seen as strategic, but also as very challenging because of the difficulty of developing
employees who can work successfully across cultures (Bovee, et al, 2007).
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 9 Student ID:1033166
1.1. Cross-‐cultural social intelligence
In order to function across cultures members of staff have to understand different ways of thinking,
taking action, and behaving in different international social contexts. In order to do that, employees
need to have Cross-‐Cultural Social Intelligence (CCSI). CCSI represents an amalgam of knowledge,
skills, abilities and other characteristics (Ascalon, Schleicher, Born, 2008).
It can be seen as a tool to analyze one of the major reasons why expatriates return to their home
country before the termination of the assignment. This is represented by their lack of cultural
knowledge of the host country which leads to multiple challenges in adapting and understanding the
new environment (Jasawalla, Truglia, Garvey, 2004). These unsuccessful assignments can cause the
failure of an entire project within an organisation, which might even lead to huge financial loss.
In order to avoid this, it is the role of the HR department to select and train the right employees to
help reducing the failure rate of the assignments. To do that, in a recent study, Jasawalla, Truglia,
Garvey (2004), identified three major points of focus: 1) selecting expatriate managers with high
emotional intelligence, 2) providing extensive pre-‐departure cultural training (not only cultural facts,
but interpersonal skills as well), 3) to utilize sensitive training techniques to better prepare managers
for new situations.
Another solution to the problem was suggested by Ascalon, Schleicher, Born, (2008) who have
created a Situational Judgment Test which enables the measurement of CCSI. They have
recommended in their study, the use of this test as a tool for training and recruiting expatriates or
any other employees who have to face an international business environment.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 10 Student ID:1033166
1.2. MNEs operating in Romania
Even Multinational Enterprises (MNEs) do know about the importance of HRM practices and
selecting the right candidates in order to achieve organisational performance, they still fail in
adapting the right techniques for avoiding this.
After 1989, Romania became a developing economy and many MNEs have seized the opportunity of
opening new subsidiaries on its territories. Following the communist regime, Romania was lacking
the right people to manage new international businesses. Nowadays, the situation has changed and
we can see a shift towards Romanian highly skilled managers (Capital, 2004, July). Even so, MNEs
sometimes prefer to bring their actual employees from other countries in their subsidiary in
Romania to manage different departments of their business.
Having in mind the importance of HRM practices in achieving organisational performance, CCSI can
be seen as the key to achieving success in any business operating in an international environment.
Therefore this paper aims to analyze if CCSI leads to better achievements in MNEs in Romania, as
well the need of adopting new HRM practices, having in consideration the actual global economical
environment.
1.3. Aims and objectives
This study aims to identify if the MNEs operating in Romania have adopted cross-‐cultural HRM
practices and consequently analyze the importance of CCSI with regards to achieving superior
organisational performance. In addition an effort will be made to determine if the actual HRM
practices are enough, or is it needed to adapt and utilize CCSI Situational Judgement Test.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 11 Student ID:1033166
Aims and Objectives:
1. To analyze if cross-‐cultural HRM practices increase the organisational and individual
performance.
2. To investigate what are the HRM practices used by MNEs in Romania when
recruiting/training their employees.
3. To analyze if CCSI enhances the individual and organisational performance.
4. To investigate if CCSI Situational Judgement Test (SJT) is currently, or needs to be adopted as
a tool in MNEs in Romania.
Consequently this paper will be organised around three research questions:
1. Are the employees cross-‐cultural social intelligent?
2. Do companies who adopt CCSI achieve organisational performance?
3. Is the adoption of CCSI SJT a necessity in MNEs in Romania, or whether the actual HRM
practices are successful enough?
1.4. Research Outline
This project has been structured as follows:
Chapter One: Introduction -‐ Presenting an overview of HRM and CCSI background and will also
include research questions and aims and objectives of the study.
Chapter Two: Literature Review – The theoretical framework will offer a deeper understanding of
the theories behind HRM. Here, concepts like HRM practices, performance, cross-‐cultural social
intelligence will be analyzed having in consideration previous books, papers and journals.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 12 Student ID:1033166
Chapter Three: Research Methodology – This part will present the methodological approach used for
the present paper, having in consideration both, primary and secondary data and as well as
limitations.
Chapter Four: Analysis – The forth chapter of the paper aims to carefully analyze the findings.
Chapter Five: Discussion -‐ Here, the findings analyzed in the previous chapter will be argued in
relation with various literature theories.
Chapter Six: Conclusion and Recommendation – Here the conclusions will be presented together
with recommendations and the importance of this study.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 13 Student ID:1033166
Chapter 2: LITERATURE REVIEW
This chapter aims to analyze the most important theoretical aspects of the present research paper.
In order to offer a clear explanation of the link between HRM practices, CCSI and performance, the
following topics will be discussed: Human resources management, HRM practices, expatriates, cross-‐
cultural management and cross-‐cultural social intelligence.
2.1. Human resources management
HRM can be defined as “the function within an organization that focuses on recruitment of,
management of, and providing direction for the people who work in the organization” (Hafemann,
2008). Additionally, HRM is a function which specializes in hiring the right people in order to reach
the company’s goals and objectives. In order to do that, the HR department has to oversee the
employee’s training and development, to evaluate, to motivate and to compensate them (Bovee, et
al, 2008)
Analyzing previous work in the this field, it can be seen that there is a lack in clearly defining HRM
and its practices: some of the studies focus on the effectiveness of the HR department (Teo, 2002),
others on the value of HR in terms of knowledge and skills (HItt, 2001), but most of them as a mix of
individual practices (Batt, 2001; Capelli and Neumark 2001). Thus, Pauwee and Boselli (2005) identify
a total of 26 practices, out of which only 4 are most commonly used: 1) training and development, 2)
contingent pay and reward schemes, 3) performance management, 4) careful recruitment and
selection.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 14 Student ID:1033166
2.2. HRM practices – HRM performance
The link between HRM practices and organisational performance is still a debated subject. A recent
study, in which the whole previous studies and researches were analyzed, a statement is made
about the HRM impact on performance: “in much – though by no means all – of the empirical
research HRM in its ‘system’ form has been found no matter (in a positive sense) for organisational
performance” (Boselie et al, 2005).
Moreover, Theriou et al, (2009) examine in their study the linkages between the best human
resources practices, knowledge management, organisational learning, organisational capabilities and
organisational performance and affirm that better performance is achieved by the interaction
between HRM practices and the above mentioned.
In order to better understand the link between HRM practice and organisational performance,
Bowen et al (2005), assume two perspectives: 1) the systems approach and 2) the strategic
perspective of HRM. The first one refers to the overall set of HRM practices and firm performance
(rather than focusing on separate practices and employee performance), while the second one
refers to the fact that organizations should align their various practices horizontally and practices
must complement one another in order to achieve the firm’s business strategy.
Figure 1.1., Becker, et al., (1997), shows an insightful way of understanding the link between HRM
and organisational performance. In the figure below, it is presented the fact that a good HRM
strategy leads to better HRM practices, better HRM outcomes, better behaviour and performance
outcomes and in the end to financial outcomes.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 15 Student ID:1033166
Figure 2-‐1
2.3. HRM practices
Human resources managers have to help the organization to run efficiently at every level, to plan for
company’s needs, to recruit and hire employees, to train and develop them, to appraise employee
performance, to keep them motivated, to administer compensations and to retain valuable
employees (Dessler, 2004).
To do that, there can be identified 6 main functions of the HRM, Bovee et al, (2007):
1. Planning for staffing needs
2. Recruiting and hiring
3. Training and development
4. Appraising performance
5. Administering compensation and benefits
6. Overseeing changes in employment status
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 16 Student ID:1033166
Having in consideration the purpose of this study, we will have focus on only 2 of them: 1) recruiting
and hiring, 2) training and development.
2.3.1. Recruiting and hiring
Recruiting represents one of the most important functions for companies in today’s international
business environment. It represents the process through which appropriate applicants are attracted
for an organization’s jobs (Greengard, 2004).
Nowadays, hiring is a very complex and important process for MNEs as expanding globally means
meeting other cultures and experiencing other habits and work environments, all with the final goal
of a cross-‐cultural business environment. According to Jing and Bing (2010) the essential features
that distinguish a multinational corporation from an ordinary enterprise is trans-‐culture and
multicultural environment.
Thus, besides the normal stages which are followed in the recruitment process, HR managers have
to pay extra attention to the cultural aspects.
Cross-‐cultural communication represents a very important factor in the actual social-‐economical
context. Deresky states that “When a member of one culture sends a message to a member of
another culture, intercultural communication takes place” (Deresky, 2007:140). According to
Caligiuri (2000), employees should no longer be recruited by only keeping in mind their technical
skills, but also carefully analyzing their emotional intelligence, their personality characteristics and
their intercultural communication capabilities.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 17 Student ID:1033166
2.3.2. Training and development
Applicants usually begin their new jobs without knowing everything they need to know about the
organisation, industry or position, and without having all the skills they need in order to achieve
superior performance. In order to help, companies offer their employees trainings and orientation
programs through which they learn more about the new business environment and are helped to
improve or to learn new skills (Hacker, 2004).
Due to language barriers, cultural differences, cultural prejudices and stereotypes, the potential for
conflict in culturally diverse workgroups is greater than culturally homogeneous workgroups
(Harrison et al., 1998; Triandis, 2000; Vodosek, 2007). Thus, it is very important to offer the
employees trainings with which cross-‐cultural communication can be improved or developed.
2.4. HRM in Multinational Enterprises
There are different reasons why HRM practices of MNEs differ from those who have only a domestic
activity. Working in an international environment is a very complex and diverse process, not only in
that every subsidiary has to follow the company’s rules and regulations, but also it has to be
concerned with the social and political environment of the host country (Bamber, 1998).
Thus, the HR department of each MNE has to carefully select and train its employees in order to
reduce the risk of appearance of cultural barriers (Hiltrop, 2002). Usually, every organisation has a
unique approach. Even if practices are the same, it is important to know how to implement them in
the actual context (Hiltrop, 1999).
Besides the normal HRM practices, which are usually adopted by companies, MNEs have to pay extra
attention to offer their expatriates and employees who are working in multicultural environment,
different types of trainings and development programs. Fenwick (1999) highlights the importance of
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 18 Student ID:1033166
HR activities that are not necessarily in domestic firms, these include relocation and orientation
support for expatriates, job-‐rotation programmes and coordinating international training activities.
Besides these activities specific to MNEs, Hiltrop (2002) identifies the fact that MNEs are usually
using same tools as any other domestic company (staffing, assessment and compensation, training
and development, and industrial relations/employee participation) but it is the way these activities
are performed that leads to major differences.
2.5. Expatriate managers
In order to successfully compete in the international marketplace, managers have to understand
how operations work outside their home country. One way to do that is through expatriate
assignments. Expatriates are persons who have citizenship in at least one country, but who are living
and working abroad in one of the firm’s subsidiary (Hill, 2007).
One of the main reasons why expatriates are sent on new assignments is to oversee foreign
subsidiary when the local market place lacks managers with the right skills (Yeaton et al, 2008).
Besides this, there are several other reasons why they are sent to a foreign subsidiary, some of these
reasons are to gain foreign experience, to improve their managerial skills or alternatively to control
the operations like the headquarters (Bateman, 2004).
However, the choice of using an expatriate must be carefully analyzed as companies must benefit
through the assignment. Unfortunately, a lot of these assignments tend to fail. According to Jack
Stage (2005) and Srivastava and Moorman (2005) if an expat fails or underperforms the costs is
tough to quantify, leading to big losses. Failure rates are between 25 percent and 70 percent, with
total losses resulting varying from $40.000 to $1.000.000 (Crocitto et al, 2005:522).
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 19 Student ID:1033166
In order to solve this problem a lot of measures have been taken, including the global relocation
trends report by GMAC Global Relocation Services, but unfortunately expatriate failure rates haven’t
been reduced yet (Ascalon et al, 2008). Thus, organisations nowadays have to focus more on
discovering the causes of failures in order to implement new strategies and avoid them.
One key reason why expatriates finish their assignment before it officially ends is represented by the
insecurity and disappointment resulting from poor cross-‐cultural adaptation. However, previous
literatures fail in providing information regarding the interpersonal conflicts expatriates experience
at the work place and tend to focus more on the HR practices rather than analyzing personal
reasons.
Caligiuri(2000) agrees that expatriates must adapt to the differences that exist in physical,
psychological, and communication environments in order to reach a cognitive and emotional
comfort level in the host culture. Moreover, Sanchez et al (2000) affirms that trying to adapt and to
understand the accepted behaviours, language, and expressions can lead to stress. Also, because of
their inability to learn new behaviours, it is more likely that expatriates will reject the host culture
and end up in finishing their assignment earlier.
In his study, Sanchez et al (2000) blames firms for two main reasons. One reason being that
companies tend to select their candidates by only taking only their technical skills into consideration,
ignoring issues of personality, and the other that expatriates are offered poor pre-‐departure training
which is usually focused only on cultural aspects and less on analyzing their interpersonal skills.
Cross-‐cultural adaptation is the biggest challenge that ruins expatriate success. In order to be cross –
cultural successful, expatriates should be flexible, open to new ways of living, have a lot of patience
and optimism but also have sense of adventure (Jassawalla et al., 2004).
At the same time, emotional intelligence (EI) is a very important indicator. Golemann (1998), states
that EI is a very important indicator for measuring manager’s performance. In his study he suggests
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 20 Student ID:1033166
that expatriate selection should be based on self-‐awareness (ability to recognize one’s emotions,
reactions), self-‐regulation (ability to control or express emotions), suspend judgement, self-‐
motivation, empathy (being able to place oneself in another’s shoes), and social skills.
Thus, it is the role of the HR department to carefully select and train their employees in order to
reduce the failure rate. Yeaton et al. (2008), identifies four main factors of failure in MNEs, which are
inefficient selection process, lack of providing pre-‐departure and post departure trainings, poor
repatriation efforts and the inadequate knowledge of the culture and country.
To ensure success and to achieve superior organisational performance, MNEs have to focus their
attention on their employees. Sending an expatriate in a new assignment, might be a good decision
for the company at that moment, but without carefully analyzing all the possible consequences it
might turn out to be a big loss for the company. Cross-‐cultural skills are a major player in the actual
global economical context, as without having the abilities and capabilities to adapt in the host
country’s culture, expatriates risk failing to finish their assignments.
2.6. Cross-‐cultural management
Previous studies show us the fact that there is a relationship between culture and management
style. ‘Culture is the values and attitudes shared by individuals from a specific country that shape
their behaviour and their beliefs about what is important’ (Robbins, Coulter, 2009, p.97).
Therefore, cultural differences mean that management styles vary globally. What may be the right
way of managing in one country may not be the right way of managing in another (Drucker, 2008).
It is clearly identifiable that managerial styles are linked to the notion of culture (Warner, 2003). As
no one culture is the same, no one managerial style will be the same. It is important for
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 21 Student ID:1033166
management to understand this, especially when doing business from country to county, or dealing
with expatriates.
Globalization is changing our way of thinking, acting and perceiving other cultures. Harrison (2006)
identifies the fact that at the moment there is a “clash of cultures” and that it is relevant to focus on
how cultures learn from each other, and moreover, how they inspire. Also, Bird and Fang (2009)
argue the fact that the collision of cultures is leading to a “global/world culture” which threatens the
national identities.
In their research paper, Bird and Fang (2009) explain the Oriental Philosophy of Ying and Yang. The
theory was introduced to “cross cultural theory building and crafted an ‘ocean’ metaphor of culture
as an alternative metaphor to Hofstede’s ‘onion’ metaphor of culture” (2009:140). Also, they explain
that globalization has given rise to a paradoxical movement of cultures, which can be understood
having in consideration two constructs: cultural ecology (political institutions, climate, language,
traditions and customs) and cultural learning of values and practices. These two constructs are
believed to integrate and to coexist with each other in order to shape the dynamic identity of
cultures.
Furthermore, having the above in mind, Bird and Fang (2009), tried to identify new ways of thinking
and studying the influence of culture on management in the age of globalization. Their findings
concluded with the idea that managers nowadays need to display greater awareness of
governmental visions and actions, and also to give importance to politically-‐driven practices “by
which managers in global firms can not only lead their multicultural units to more effective
performance, but also engage local cultures and sub-‐cultures in efforts to foster a new type of
citizenship behaviour” (2009:142).
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 22 Student ID:1033166
2.6.1. Cross-‐cultural management approaches
People have different cultures because their values are different. Although, a cross-‐cultural
environment doesn’t necessarily mean that it is international. When analyzing Hofstede’s (1980)
definition of culture – programming of the mind that differentiates one group from another -‐ it can
be seen that he focuses on all kinds of groups, not limited to ethnic groups or nationality.
Thus, cross-‐cultural management can be understood through various approaches. Fontaine (2007)
highlights the idea that cross-‐cultural management has various approaches and identifies 6 different
perspectives as follows: 1) classical approach (cross-‐cultural managers are experts on Hofstede), 2)
the anthropological approach (cross-‐cultural managers must be more like anthropologists), 3) the
psychological approach (cross-‐cultural managers sometimes must think like psychologists), 4) the
stereotyping approach (cross-‐cultural managers should act as psychological counsellors, helping
team-‐members in identifying and change negative stereotypes), 5) the knowledge management
approach (cross-‐cultural managers are knowledge-‐management facilitators – they transform tacit
knowledge into explicit knowledge) and 6) the systems thinking approach (cross-‐cultural managers
have the role to design/redesign the system inside the organisation to improve cross-‐cultural
relationships).
Therefore, “cross-‐cultural management represents more than managing cultural differences. It has
to focus on “management”, on determining what are the policies managers can take to minimize
cross-‐cultural friction and leverage the sharing of cultural knowledge” (Fontaine, 2007:134).
2.6.2. Cross-‐cultural management interaction
Cross-‐cultural interaction might be impeded by critical incidents. In order to understand why these
incidents appear and to comprehend their importance, it is required a new way of analyzing
management interaction. Thus, Kolling (2007:39) mentions the fact that “the decisive issue is not the
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 23 Student ID:1033166
existence of cultural differences per se, but the way behavioural differences are perceived,
interpreted and managed by individuals of different national cultures in the context of doing
business.”
In their research, Fink, et al., (2007) discuss the idea that cultural dimensions, personality traits and
cultural standards are interrelated, and that it requires a deeper understanding of the relations
between these three strands to determine the processes that lead to the appearance of critical
incidents, and other reactions of individuals to critical incidents. This allows individuals to enhance
their performance in cross-‐cultural relations and, thus, also the performance of the business to
which they belong.
In order to better understand cross-‐cultural interactions and how the above three dimensions are
interrelated, Neyer and Kolling (2003) have developed based on Parson and Shills model (1962) a
cross-‐cultural interaction model.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 24 Student ID:1033166
Figure 2-‐2
Figure 2.1. shows the fact that cross-‐cultural interaction takes place among the social systems of
different cultures, and in doing so, build up a new space: a common cross-‐cultural space. It is very
important to understand that there is no direct interaction between the value systems or the
personality systems, and action and interaction takes place only in the social sphere.
In order to achieve superior organisational performance, employees who are facing multicultural
contexts must apply these three strands (cultural dimension, personality traits and cultural
standards) all together (fig.2.2, Neyer and Kolling (2003).
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 25 Student ID:1033166
Figure 2-‐3
2.7. Cross Cultural Social Intelligence
Cross-‐cultural social intelligence (CCSI) represents a key factor in the future development of
companies (Ascalon, Schleicher and Born, 2008). CCSI is defined by employees who can effectively
function across cultures and it can be explained as a mix of social intelligence and culture. Social
intelligence represents “the capacity to know oneself and to know others is an inalienable part of
the human condition as is the capacity to know objects or sounds, and it deserves to be investigated
no less than these other ‘less charged’ forms” (Howard Gardner, 1983:243). At the same time
culture is a complex term which influences people’s preferences of conflict management styles
(Yuan, 2006). According to Ascalon, Schleicher and Born (2008) there are two dimensions that are
essential for CSSI: ethnocentrism and empathy.
Ethnocentrism is “the view that one particular ethnic group is somehow superior to all others”
(Unknown, 1999) and according to Gil-‐White (2010) is a temporary negative moral judgment on how
others organize their lives ethnically, driven by their tendency “to see their cultural group as proving
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 26 Student ID:1033166
the norms for acceptable behaviours and preferences” (Erdogan, 2010:395). Nevertheless,
ethnocentrism represents a very important step in cross-‐cultural communication (DiStefano and
Maznevski, 2000).
Empathy is a key element for social-‐intelligence (Marlowe, 1986) and it means to identify with
another's feelings, and the ability of putting yourself emotionally in the place of another (Hein,
1999). Unfortunately sometimes managers have the tendency to recreate their conception of what it
means to be a social person (Waele and Harre, 1976) and they fail in accepting the fact that
understanding social behaviour and social interaction is about understanding the rules that shape
human conduct (Unknown, 1996).
Cross-‐border business failures represent a very important case for intercultural training
(Wederspahn, 2002). In order to better train future expatriates or current employees who might
interact with a multicultural environment, companies have to be aware of CCSI importance.
One big mistake nowadays is that “organizations worldwide often react to economic downturns and
uncertainty abroad by cutting training for expatriates and international business travellers”
(Wederspahn, 2002:67). Even if Hightower (2003) suggests that creativity is the heart of business,
when speaking about cultures, creativity shouldn’t be mentioned because “expatriate failure rates
suggest the need for more robust support programs” (Stage, Jack, 2005:48).
The lack of proper training, through which the employee/expat clearly understands cultural
dimensions, can have a tremendous impact in the success of the company. HRM practices nowadays
tend to be inefficient. In a normal recruiting process, according to Earley, (2006) candidates usually
have to complete a personality test. Personality tests represent “any of several tests that consist of
standardized tasks designed to determine various aspects of the personality or the emotional status
of the individual examined” (Merriam, 2004). But studying just personality is not enough to
understand how a person will behave in different cultural situations.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 27 Student ID:1033166
In their study, Ascal, et al, (2008) have constructed a tool for assessing CCSI. By creating a Situational
Judgement Test they can measure the two dimensions of CCSI: ethnocentrism and empathy. Their
findings suggest that the ordinal-‐level effectiveness of cross-‐cultural communication styles (most to
least effective) is empathetic – non-‐ethnocentric, empathetic – ethnocentric, non-‐empathetic – non-‐
ethnocentric, and non-‐empathetic – ethnocentric.
Due to the fact that at the moment there are insufficient tools for assessing CCSI, the CCSI SJT can
have multiple uses. It can be used in the selection and promotion process of applicants who would
work in a multicultural environment, in the selection for expatriate assignments, and for training and
development initiatives.
2.8. Romanian Managers and HRM
After the communist era, the Romanian society faced a lot of changes. Terms like HRM, leadership
and management started to be acknowledged and discussed. Unfortunately even so, still today in
Romania, economical problems are more important for managers than the style of leadership they
practice – a Romanian manager can hold a top position but that doesn’t necessarily mean that
he/she will be effective. This problem can be analyzed through the fact that most of them received
their education in the communist years, years in which terms like free economy, private property,
management and the like, weren’t discussed.
Being responsible for all the strategies adopted by a company was managers’ influence as well the
HRM strategy of the organisation. Analoui (2004) in an interview for Capital magazine declares that
the Romanian style of management is a traditional one and that “an integrated policy of HR does not
exist in most Romanian companies” (February, 2004:35).
Furthermore, there seem to be three different types of management style (Capital, June, 2001):
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 28 Student ID:1033166
1. Romanian state companies – characterized by the capability to accept uncertainty, and by
direction toward the superiors in order to get their rewards
2. Romanian private companies – characterized by consideration towards employees
3. MNEs from Romania –a very complex pattern of management style, characterized by the
power to influence others, by the accuracy of predictions, and by integration.
In a study conducted by Constantin, et al., (2006), in which the HRM practices from Romania were
analyzed, they have come to the conclusion that HRM doesn’t seem to be a priority for Romanian
managers. Some of them have never solicited HRM services or training programs. Overall it seems
that they prefer to hire external HRM services rather than to hire an internal expert. Moreover, they
have pointed out the idea that the size of the organization matters when speaking about HRM
practices.
To be more precise, in Romania, multinational companies are using their own mix of HRM practices.
Moreover, even if they are not totally aware of the importance of these practices, managers of large
Romanian companies are soliciting external consultancy and training services, while in smaller firms
HRM practices are totally ignored.
In this chapter an attempt has been made to explain past literature, more precisely to highlight the
importance of HRM practices and CCSI in the current global economical environment. Also the
relationship between the above mentioned and organisational performance was described.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 29 Student ID:1033166
Chapter 3: METHODOLOGY
3.1. Introduction
This chapter aims to understand the concept of research, and to explain the methodological
approach used in order to fulfil the aims and objectives of this dissertation.
Here, an understanding of data collection methods will be covered, questionnaire design, reasons
for choice of methods used, as well as limitations of the study.
The methodological approach and process of a study are important and essential for the quality of
every research project and for achieving precise and trustworthy results (Bryman & Bell, 2007). This
is because it is the overall research process for collecting and analysing data (Collis & Hussey, 2003).
For this reason the methodological approach of this study was designed very carefully and took into
consideration all the important issues in order to discover things that they have a clear rationale and
thus increase knowledge (Saunders, Lewis & Thornhill, 2007).
3.2. Research Design
It is commonly known that the two main categories of research strategies are qualitative and
quantitative research strategies (Bryman & Bell, 2007). From the one hand qualitative research is
based mostly on the quantification of data and on the other hand qualitative is related to the
measurement of things and to the social world (Berg, 2001). To achieve better results, in this study
it was used a combination of qualitative and quantitative methods.
In order to carefully examine the aim of this study which is the exploration of key HRM practices and
their relationship to organizational performance and as well the importance of CCSI in MNEs
operating in Romania, a combination of methods is required. Gilbert (1993) mentions the fact that
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 30 Student ID:1033166
the researcher should not limit the study to a single method of data collection and at the same time
highlights the fact that the values of all methods shouldn’t be underestimated. Furthermore, almost
always there are some favouritisms related with the collection methods, and thus by collecting data
through more than one way there are less possibilities for biased results (Sekaran, 2000).
The data for this study was gathered using a questionnaire consisted by both, close-‐ended questions
and open-‐ended questions. In this way there is a use of both qualitative (open-‐ended questions) and
quantitative method (closed-‐ended questions). Quantitative method has the advantage that is cost-‐
effective, and it is a well approaching method for participants, while qualitative method offers an in-‐
depth exploration and understanding of the phenomenon by offering a broader picture of
participants’ views (Bryman and Bell, 2007). Overall the data gathered for the conduct of this
research were both primary and secondary. Below there will be a detailed analysis of primary data
including open and closed questions.
3.2.1. Primary Data
Primary data collection refers to original data that is collected for a specific purpose by the
researcher (Zikmund, 2000) and are essential for a study as they are close to the ‘event’ and to the
‘truth’ (Walliman, 2005). They are considered as more valuable, accurate and reliable than
secondary data.
3.2.1.1.Closed Ended Questions
The questionnaire I have used in the first and last part of my research is an adaptation of a previous
study by Gould-‐Williams (2003). Gould-‐Williams conducted a research in public-‐sector organisations,
investigating the operation of HR practices and their impact on the organisational performance. The
results of this study underline the “important role of HR practices in generating superior
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 31 Student ID:1033166
performance: the more HR practices used within the organization, the greater the impact on
performance” (Gould-‐Williams, 2003, p.43).
Thus, the first part of the questionnaire will be investigating if HRM practices and CCSI lead to
satisfied and committed employees that contribute in achieving superior organisational
performance.
Moreover, having in mind the fact that the questionnaire was distributed before, it ensures the fact
that all the questions will be clearly understood. However, parts of Gould-‐William’s questionnaire
will be excluded from this study because they are irrelevant.
Overall the questionnaire is consisted of 6 items measuring the HRM policies and practises and 10
measuring CCSI and the individual and organisational performance (3 measuring CCSI and 7 the
individual and organisational performance). More specifically there will be six items measuring HR
practices: one measuring training and development, one team work, two items selective hiring, one
item measuring related payment, and one measuring information sharing and participation (see
Appendix B). Additionally, there are 3 items measuring CCSI, and 6 more measuring individual
outcomes: one measuring satisfaction, one commitment, one employees’ intention to remain, three
measuring the efforts made for the organisation. Last but not least there are 2 items measuring
organisational outcomes.
Additionally, with the help of closed questions, participants were asked to indicate the extent to
which they strongly agree or disagree with each statement using a five-‐point Likert scale. On the
scale 1 represents ‘strongly agree’ and 5 ‘totally disagree’ (see Appendix B).
However, there will be some open questions as well.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 32 Student ID:1033166
3.2.1.2.Open -‐ Ended Questions
Having in mind the idea that qualitative approach offers a better and deeper investigation, it was
considered as appropriate to add open-‐ ended questions in the questionnaire (see Appendix B). The
open questions were designed by the researcher of this study in order to identify challenges faced
by expatriates and employees in cross-‐cultural environments, to analyze the HRM practices and
furthermore to investigate future recommendations for expatriates and HR departments in MNEs
operating in Romania.
This section was divided in two parts: The first one is addressed to expatriates, while the second one
is addressed to Romanian employees who are interacting with people from different cultures. To be
precise, the first question analyzes the challenges faced by expatriates/Romanian employees; the
next two questions analyze the HRM practices, while the last two set of questions analyzes the
employees’ recommendations for future expatriates/Romanian employees and HR managers.
Finally, the last one gives them the opportunity to mention if they have had the opportunity to
answer to a situational judgment test. With open questions, participants will have the opportunity to
express their views and beliefs further and add some details and comments to their responses.
3.2.2. Secondary Data
Even if secondary data are not as important as primary data, they support the primary data and the
findings of this research. For this paper, secondary data was collected from books, journals and
electronic database. The accent was put on journals from the Brunel University Library to make sure
the validity and reliability of the study. Most of the journal articles were from good quality academic
journals. Also the time frame of the secondary sources was kept under a check so that the findings
were not too old and irrelevant.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 33 Student ID:1033166
Such sources were used for obtaining information for this study around HRM practices, HRM
outcomes, CCSI, and regarding the importance of HRM practices in the actual global economical
context. These data allow the researcher to have access to appealing, essential and considerable
information.
3.3. Context and Sample of the Study
This study was conducted in five MNEs operating in Romania:
1. IKEA
2. Xerox
3. SAP
4. IBM
5. DHL
The sample of this study is comprised by the employees working in these organisations. More
specifically, the sample was sent to 10 employees of each organisation.
Finally, a brief description of those organizations is available as an appendix (see Appendix A).
3.4. Ethical Issues
When conducting a research, ethical principles have to be considered. The researchers must take
into consideration to respect the ethic rules for those who participate in a study. Informed consent is
a requirement to participate in a survey, as well as the assurance not to harm participants, to
protect their privacy and prevent deception (Bryman and Bell 2007). For this reason this research
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 34 Student ID:1033166
was carried out to the highest standards of integrity, by ensuring trust, dignity, confidentiality and
anonymity.
The participants’ rights were recognized and respected. They were informed that there would be
privacy and confidentiality, and that the information given, would be used only for the purpose of
this study. All of the respondents in this survey were informed of these rights before the
administration and those who agreed to participate were requested to complete the questionnaires.
For this reason, participants were given a document (see Appendix A) in which they were informed
about the questions they were going to answer and the reasons of the study.
Last but not least, there is not a misrepresentation of data during the survey; the research design and
the data are presented very clearly leaving no room for misunderstandings and confusion. Moreover,
the questionnaire was sent to each HR manager of each company in order to check it, to avoid
misinterpretation, to ensure the relevance of the questions asked, and to eliminate ambiguity.
3.5. Limitations
During the research process some difficulties have been observed.
First of all, there was a lack of secondary data. Past literature doesn’t discuss too much about the
HRM practices in MNEs, especially MNEs operating in Romania. Moreover, another impediment is
represented by the small number of people who participated in the study. Unfortunately, even if all
five organizations have a lot of employees, the main point of focus was to assess expatriates, who
represent just a small number in the entire organisation.
Furthermore, a lot of words had to be removed due to the size of this study.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 35 Student ID:1033166
Chapter 4: DATA ANALYSIS AND FINDINGS
4.1. Introduction
The present chapter aims to analyse and interpret the findings of the research. In the first part, the
closed questions were analysed with the help of Microsoft Excel, while the second part will analyse
the findings of the open questions.
Overall response rate was of 98%, as shown below:
Table 4-‐1: Response Rate
ORGANISATION RESPONSE RATE
IKEA 100%
IBM 100%
XEROX 100%
SAP 100%
DHL 90%
Overall 98%
The findings will be structured in three different parts: the first part is analysing the HRM practices in
MNEs via closed questions, the second part is analysing the open end questions, while the third part
will interpret the results of the last series of closed questions by analysing CCSI and its outcomes and
its impact on individual and organisational performance.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 36 Student ID:1033166
4.2. Findings – HRM Practices in MNEs
This part aims to analyse the results regarding the use of HRM practices in MNEs operating in
Romania via closed questions. The findings are interpreted one by one as it follows:
4.2.1. Training and development
The first question examines the use of training and development in 5 MNEs from Romania. More
specifically, the respondents were asked if they are provided with sufficient opportunities for
training and development. The graphic below indicates the percentage responses of the
organisations:
Graph 4-‐1
As shown in the above chart, the employees of IKEA totally agreed with the fact that they are
provided with sufficient opportunities for training and development with a percentage of 60%. At
the same time 50% of the employees in IBM agreed with the above statement; followed by XEROX
and SAP employees who agreed as well, but in a percentage of 40%. On the other hand, the graph
shows that DHL’s employees disagreed with a percentage of 66.66%.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 37 Student ID:1033166
4.2.2. Team work
Team work was examined as well using a closed question. Employees were asked if team working is
strongly encouraged in their department.
Graph 4-‐2
According to the above chart employees from DHL totally agreed with a percentage of 77.77% with
the above statement. At the same time, participants from IBM totally agreed with a percentage of
60%, while only 50% of the employees working at IKEA agreed. Moreover, 40% the participants
working at SAP don’t know what to answer regarding team work in their department, while 30% of
them agree.
4.2.3. Selective hiring
Another practice assessed in the questionnaire referred to selective hiring. In order to offer a better
understanding, there were two questions formulated regarding the above mentioned practice.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 38 Student ID:1033166
The first one question was examining the use of a rigorous selection process when selecting new
recruits.
Graph 4-‐3
The above chart indicates the fact that the majority of the employees working at SAP totally agrees,
with a percentage of 70%, followed by XEROX whom employees are agreeing with a percentage of
50%. Moreover, as it seems from the graph, almost half (44.44%) of the employees working at DHL
and half of the participants from IKEA don’t know anything about the processes of selecting new
recruits. More than that, nearly 35% of DHL employees disagree with the above mentioned
statement.
The second question regarding selective hiring was measuring the fact that when new management
positions come up, the department normally tries to fill them with people from within the
department or authority rather than recruiting from outside.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 39 Student ID:1033166
Graph 4-‐4
From the above chart it seems that employees from three out of five companys agree with the
above statement. Precisely, 80% of the participants from IKEA strongly agree, while the rest of 20%
agrees. Moreover, employees working at IBM totally agree in a percentage of 60%. At Xerox, the
majority of 70% agrees and 20% totally agree. On the contrary, there is a high percentage of
disagreement (55.55%), followed by a totally disagreement of 22.22% from the participants working
at DHL.
4.2.4. Related payment
The fifth question aims to analyse related payment. The participants were asked to asses if the
department they are working in tries to relate pay with their performance.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 40 Student ID:1033166
Graph 4-‐5
As the above chart indicates, the majority of the employees from all companies agrees with the fact
that their payment is related to their performance, with the exception of DHL, whom employees
disagrees with a percentage of 66.66% followed by participants from IKEA who diasagree with a
percentage of 40%. More specifically, employees from SAP and IBM agree the most with a
percentage of 60%, respectively 50%. While only 40% of the employees working at Xerox agree with
the above mentioned statement.
4.2.5. Information sharing and participation
Last but not least, the sixth question was related to information sharing and participation. The
participants were asked if management involves people when they make decisions that affect them.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 41 Student ID:1033166
Graph 4-‐6
As it is shown in the above chart, there was a strong disagreement (70%) at IKEA. At the same time,
it can be seen that employees from SAP tend to agree/strongly agree (40%) with the above
statement, while half of the participants from IBM don’t know what to answer. Moreover, the
majority of employees from DHL is disagreeing in percentage of 44.44% while 33.33% of their
participants totally disagrees.
4.3. Findings – CCSI and Organisational Performance
The last part of this chapter aims to analyze the third part of the questionnaire. Here, the
participants were asked to answer to ten questions. The first three questions are measuring CCSI,
while the last seven questions aim to analyse the impact of HRM practices and CCSI on
organisational performance.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 42 Student ID:1033166
4.3.1. Cross-‐cultural Social Intelligence
There were three questions assesing CCSI. The first one was measuring if the participants were able
or not to recognize and understand (non)verbal cues of persons form a variety of cultures.
Graph 4-‐7
Acoording to the above chart, most of the employees who participated at the study were neutral.
More specifically, 60% from IBM followed by Xerox with a percentage of 50%. Moreover it can be
seen that there is a high percentage of disagreement at SAP (50%) and Xerox (40%), while almost
half of the participants working at DHL (44.44%) totally disagrees with the above statement.
The second qustion assesing CCSI aims to analyze if employees can make accurate social inferences
in a variety of cultural contexts.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 43 Student ID:1033166
Graph 4-‐8
The above chart shows the fact that there is a strong disagreement among the companies. More
specifically, both SAP’s and Xerox’s employees disagreed with a percentage of 50% while the
participants from DHL totally disagreed with a percentage of 44.44%. At the same time 50% of the
emplyees working at IKEA are neutral with the above statement. Having in mind the size of the
sample used for this research, it is important to analyze the small percentage who agreed from IBM
(20%), Xerox (20%), IKEA (10%) and SAP (10%).
The last question assesing CCSI, had the objective to analyze if the participants can accomplish
relevant social objectives across cultural negotiations and interactions through one’s acceptance and
understanding of other cultures.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 44 Student ID:1033166
Graph 4-‐9
As the above chart shows, it can be seen that opinions are distributed somehow equally among the
companies. More specifically, 40% of the participants working at IKEA agree, followed by 30% of the
employees working at IBM and SAP. Moreover, the rest tend to distribute their answers somehow
equally between those statements. At Xerox, half of them are neutral, while 3 of them disagree.
Compared with the other companies there is a high percentage of totally disagreement at DHL
(44%).
4.3.2. Organisational Performance
In order to get a better understanding of the impact CCSI and HRM practices have on organisational
performance, participants were asked to answer seven more questions.
The forth question of the second part in the questionnaire aims to asses the employees satisfaction
at their jobs. The results are as follows:
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 45 Student ID:1033166
Graph 4-‐10
As the above chart shows, it can be seen that the majority of the participants is satisfied with their
current job. More specifically, 70% of the emplyees working at IBM, followed by 60% of the
participants from IKEA and SAP agree with the statement. Moreover, there is a percentage of 40%
totally agreeing and 40% agreeing at Xerox. The only company that highly disagrees is DHL with a
percentage of 44.44%.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 46 Student ID:1033166
The next three questions in the questionnaire aim to asses exployees’ commitment. The first one
asked the employees if they feel like they are part of their department.
.
Graph 4-‐11
The result were mostly possitive as it can be seen from the above chart. There is a high percentage
of agreement and totally agreement in all the companies. More specifically IBM, IKEA and XEROX
scoring the most. Even if the results in the previous questions weren’t quite possitve for DHL, here
55.55% of their employees agrees with the fact that they belong in the department they are working
in.
The second question assesing commitment, aims to identify if the employees feel like leaving their
jobs.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 47 Student ID:1033166
Graph 4-‐12
The above chart shows, like the previous one that most of the employees do like the company they
are working for, and they do not want to leave their actual emplyment. More specifically, IKea
scored the most (90%), followed by SAP (80%), while IBM and Xerox scored the same percentage of
60%. The only participants who have scored negatively (55.55% disagreement) at this question, were
the employees working at DHL.
The third question assessing commitment asks the employees if they feel like they are making an
effort not only for themselves, but for the department they are working in as well.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 48 Student ID:1033166
Graph 4-‐13
The findings for the above mentioned statement show that the majority agrees. More precisely,
there is a high percentage of agreement in all companies. Employees working at IBM agreed the
most with a precentage of 80%, followed by IKEA (70%), DHL (66.66%), SAP (60%) and Xerox (50%).
The eight question of the third part of the questionnaire has the purpose to analyse the employee’s
effort. The participants had to answer if they seek out training and other ways of development at
work. The findings are as follows:
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 49 Student ID:1033166
Graph 4-‐14
As the above chart shows, almost all the employees from all the companies participating at this
study totally agreed with a percentage of 90%.
The last two questions in the questionnaire are aiming to analyse the employees perception
regarding the organisational performance. The first one, is assesing the quality of the services
provided.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 50 Student ID:1033166
Graph 4-‐15
As it seems from the above chart only the majority of the employees working at IKEA totally agrees
with a percentage of 80%, while more than 50% of the rest of the participants from the other
companies are agreeing. Moreover, it can be seen that the employees working at DHL are divided
and have two different opinions: 44.44% agree, while 33.33 disagre with the above mentioned
statement.
The last question in the questionnaire aims to analyse if employees believe that overall their
department performs extremely well.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 51 Student ID:1033166
Graph 4-‐16
As it seems, all the companies are agreeing with the fact that the organisation performs really well.
More precisely, 70% of the participants working at IKEA totally agree, while the employees from the
rest of the companies agree as well in a high percentage.
4.4. Findings – Open Questions
The second part of the questionnaire has five open questions which are aiming to analyze the
challenges the employees have faced in cross-‐cultural interactions and to identify which are their
recommendations to future expatriates, employees or HR managers.
More precisely, the first question asked the participants which were the challenges they have faced
during their overseas assignments/business trips. Almost all the employees mentioned the same
problems. More specifically, they have found themselves in different situations where they didn’t
know how to react, how to interpret interactions and discussions with employees from another
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 52 Student ID:1033166
country. One of the employees, working at IKEA, mentioned the fact that even if he is at the moment
in his forth assignment in another country, he still finds sometimes difficult to understand ones
culture. But, at the same time, having in mind his experience with different cultures, he started to be
more open, trying to understand that everybody has his/her own way of behaving. The biggest
challenge he experienced was during his first assignment abroad in Vietnam, where after moving
from a country like USA, he found himself in very awkward situations, because he didn’t know
exactly what to expect. He mentioned the fact that with the help of the people working in the
company he started to accommodate and to learn new things, which in the end made things easier
for him even in future assignments.
Moreover, one of the participants from SAP said that before starting his new assignment had more
business trips to Romania, and this fact helped him to accommodate easier in the new environment.
He also mentioned that even if the whole culture was new for him at the beginning, now he feels like
being home, but speaking another language.
Another interesting answer came from one of the participants working at DHL who mentioned the
fact that even if she is interacting on a daily basis with other employees from all over the world, she
is still trying to understand how other cultures work. One of the challenges mentioned was even the
fact that sometimes it is difficult to interact with them due to the language barriers.
The most interesting answer came from an employee working at IBM, who said that he didn’t find
himself in difficult situations, but his family did and that was the reason why his wife and kids had to
move back to their home country. Moreover, he mentioned the fact that even in these
circumstances he continued his assignment until the end and when he was asked to start a new one,
he accepted again, but this time being more careful with the decisions he took for his family.
The second question asked the participants what types of training and support they received from
the company before starting a new assignment, and respectively before interacting with people
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 53 Student ID:1033166
from other cultures. The answers received were very diverse. Most of the expatriates answered that
they did receive training, but most of them were trainings offered to them in order to better
understand their new position and the company. Few of them mentioned the fact that they didn’t
receive too much information regarding the country they were moving to, just informative
discussions, and what they knew before moving to another country was mostly from their personal
experiences, and not from trainings offered by the company.
On the other hand, Romanian employees mentioned the fact that they weren’t offered any cultural
training. Employees working at IKEA answered that the most useful support offered by their
company was the participation at different team buildings and social events in their company, which
offered them the opportunity to better understand their colleagues. One of them said that “Kick-‐off”
(team building organised annually, at which employees from Romania, Bulgaria, Turkey, and Egypt
gather for a weekend in order to get to know each other) is one of the most important events in the
company because everybody is relaxed, joyful and by being so, it becomes easier to interact and to
understand each other. The impact of this programme is quite big, as someone else mentions,
because even after they go to work again the following week, the bounds are made and
communication becomes easier among employees.
The next two questions aim to analyze the recommendation the current employees have for future
expatriates and HR managers.
The findings here were most of them the same for the first question, almost all the employees
mentioned the fact that there should be more trainings and more support offered by the companies.
Two expatriates working in IBM said that, even if they do feel like succeeding in their assignments,
they feel like they could do more with a bit of help. One of them said that, he thinks expatriates
should have a trial period with their families, for at least one month in order to better understand
the future challenges they are going to face. Moreover he said that they should be offered language
classes at the beginning, so that they could at least communicate basic things when going to the
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 54 Student ID:1033166
supermarket or interacting with people who don’t speak English. The other employee said that even
if he feels like he is part of this country, sometimes he finds it difficult to understand some cultural
aspects, and that it might be helpful to have some more guidance from the company.
The answers received from the participants working at the other companies were quite similar. For
example, most of the employees working at DHL, mentioned the fact that in their company there is a
huge lack of training and support even for expatriates and because of this, the overall atmosphere in
the company tends to be tense. Moreover, two expatriates from SAP said that the HRM practices in
their company are good, but unfortunately some of them fail because they do not analyse the
situation before moving and they find themselves in the end in a new environment in which, even if
trained, sometimes it is difficult to integrate without having good social and personal skills.
One of the questions asked the Romanian employees if they think that the expatriates in their
company did a good job. The majority answered that they did, even if sometimes they faced
different unexpected situations. In IKEA, it looks like team work is strongly encouraged and with the
help of the people from the department, expatriates integrated and learned really fast about the
new environment. Another interesting answer came from the participants working at DHL who
mentioned the fact that they have seen a really big effort coming from the new expatriates, and that
after a period of time and with their help, positive results appeared.
The last question in the second part of the questionnaire, aims to analyze the use of the Situational
Judgement Test as a tool to asses future employees/expatriates. The concept was defined, and then
the participants had to answer simply with yes or no. The findings show that all the employees from
all five companies never had the chance to participate in such kind of test.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 55 Student ID:1033166
Chapter 5: DISCUSSION PART
5.1. Introduction
In this chapter, the findings will be analyzed and discussed. This part will be divided in four sections,
all, of them having the purpose of answering the research questions. The first discussion will focus
on the HRM practices adopted by companies in Romania, and will try to analyze the link between
them and individual/organisational performance in five MNEs operating in Romania. The second
part, aims to analyze if expatriates and Romanian employees, who are working in a cross-‐cultural
environment, are Cross-‐Cultural Social Intelligent. Furthermore, in the third part, the link between
CCSI and performance will be analyzed having in consideration the findings from the previous
chapter. Last but not least, it will be discussed how successful are the current HRM practices in
MNEs in Romania.
5.2. HRM Practices
The link between HRM practices and performance is a subject that has been debated many times by
researchers in the past years (Pauwee, et al., 2005; Theriou, et al., 2009; Kramar, 2009; Bowen, et
al., 2009).
Considering the responses of employees working in five MNEs operating in Romania, this paper aims
to analyze if the HRM practices adopted by those firms lead to organisational and individual
performance. The findings analyzed in the previous chapter show the fact that, opinions and
practices differ quite a lot from one company to another. For example, in IBM it is considered that
employees are offered enough opportunities for training and development, while participants from
DHL disagree with that. On the contrary, in the following question, employees working at DHL
agreed, while participants from IBM didn’t feel like team work is strongly encouraged in their
company.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 56 Student ID:1033166
It is known that a good mix of HRM practices leads to high organisational performance (Hill, 2007). If
carefully analyzed, the findings of this paper show that each company focuses on a different mix of
practices. For example, in IKEA, even if trainings and development programmes are offered,
employees don’t feel like their pay is related to their performance or that they are involved in
decisions by managers, which affect them. While at SAP, even if expatriates start new assignments
after a rigorous selection, they do not consider they are offered enough training and development
programmes.
One of the most interesting results regarding the HRM practices can be found by analyzing the
answers received from participants working at DHL. Here, almost all the employees agreed only with
one question which was assessing team work, which means that all the other HRM practices are
ignored in their department. Moreover, it seems that in IBM there is a very good use of all practices
compared to SAP where participants’ opinions varied from a practice to another. Therefore, it can be
stated that each company has a different strategy and has different ways to keep its employees
motivated.
It is a very interesting finding to see that all participants from all companies agreed with the fact that
their department/company achieves performance, except employees working at DHL (fig. 4.14, fig.
4.15). Having this taken into consideration, it can be stated that the use of a good mix of HRM
practices in MNEs operating in Romania is linked to organisational and individual performance.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 57 Student ID:1033166
5.3. Cross-‐cultural social intelligence
The major point of focus of this paper is to analyze CCSI’s importance as a tool to assess expatriates
and employees working in multicultural environments and to investigate if CCSI leads to individual
and organisational performance.
Participants of this study had to answer three questions, which had the aim to measure CCSI. The
findings show that none of the participants have strong CCSI skills. Some of them, mostly employees
working at IKEA, IBM and Xerox had higher positive results, but none of them totally agreed with any
of the statements (Fig 4.6., fig. 4.7., fig.4.8.). This means that there is not even one employee having
strong CCSI skills in any of the companies.
5.4. CCSI – Performance
According to Ascalon, et al., (2008), CCSI can be used as a tool when selecting expatriates or hiring
new employees, in order to reduce failure rates and to achieve superior organisational performance.
The purpose of the open questions was to identify if expatriates had during their assignments and
what those challenges were. The results show us the fact that, even if the majority had encountered
few impediments in their assignments, they have never failed. Analyzing these findings, we can see
that even if employees do not have CCSI skills, they have managed to finish their assignments.
Therefore, the lack of CCSI skills does not necessarily mean that the company is not achieving
organisational performance.
Even if employees are achieving performance without having CCSI skills, most of them mentioned
the fact that they find it difficult to interact with people from other cultures. Because of this, it is
sometimes possible to face embarrassing or strange situations which might lead to unsuccessful
deals or business negotiations (Shih, et al., 2006).
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 58 Student ID:1033166
In order to avoid that, all the participants have mentioned the fact they need more support from
their companies. Unfortunately, after analyzing the findings, it can be seen that most of the
companies failed in offering their employees enough trainings and development programmes.
5.5. HRM practices and CCSI in MNEs operating in Romania
The results of this study show us different aspects on how companies perform in Romania. It can be
seen that each company is using a different technique and a different mix of HRM practices. Some of
them focus more on team work, some more on related payment, while others do not focus on any
practice at all. Moreover, none of them has employees with strong CCSI skills.
Because all the companies participating at this study achieve organisational performance, it can be
stated that the current HRM practices used at the moment are successful. At the same time, it must
be considered the fact that expatriates/employees are not totally satisfied with their jobs and that,
sometimes, they are facing difficult cross-‐cultural situations.
The story of the expatriate working at IBM who didn’t stop his assignment after his family had to
move back to their home country, shows the fact that a lot of factors must be taken into
consideration by companies when selecting a new expatriate. Failing in doing so can lead to the
failure of an entire assignment. In this situation, the company had a strong and skilled employee,
who understood and found a compromise in order to solve the situation without causing too much
trouble to the company.
Furthermore, one of the most important findings of this study is that all the participants strongly
agreed with the fact that they need more trainings and development programmes. Having the above
in mind, it can be seen that companies risk a lot by not offering sufficient support to their
expatriates.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 59 Student ID:1033166
Therefore, companies should improve their HRM practices and should start paying more attention to
new tools for assessing their employees. Even if these five companies achieve organisational
performance, they are facing big risks by keeping their current strategy.
The Situational Judgement Test is the assessment tool proposed by Ascalon, et al., (2008) in order to
measure CCSI. This test is recommended in their study to all organisations which are facing cross-‐
cultural environments, and which want to achieve superior organisational performance.
As mentioned before, the MNEs operating in Romania have a successful mix of HRM practices, but at
the same time, in order to achieve superior performance and to have skilled and well prepared
expatriates for their assignments, they should start adopting new strategies. Thus, CCSI SJT is a tool
that should be adopted by most of the companies, among other trainings and development
programmes.
It can be concluded that each company has a different strategy and a different mix of HRM practices.
Even if their practices are different, somehow each company manages to achieve organisational
performance. In order to successfully compete in today’s global economical environment,
companies must be aware of the fact that sometimes they should pay more attention to their
employees’ needs and wants. Thus, it is very important to improve the current practices and adopt
new strategies in order to achieve superior organisational performance.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 60 Student ID:1033166
Chapter 6: CONCLUSIONS
6.1. Introduction
This chapter aims to summarize the entire study and to link the results with the literature review and
research objectives. Also, here it will be explained which are the limitations of this study, and will
offer future recommendations for further research and managerial implications.
6.2. Research Findings and Recommendations
Employees are the most important asset of a company. In the current socio-‐economical context,
they are facing major challenges every day. Due to the big impact globalization has, all businesses
are expanding globally and are opening subsidiaries all over the world. Thus, employees are working
in a cross-‐cultural environment, an environment which is full of people originating from different
cultures.
In order to be successful, sometimes companies decide to send an employee from his home country
to another country, in order to apply there the managerial skills he/she has learnt at the
headquarters. By doing this, companies risk a lot. Moving from a country to another and
experiencing a totally new environment might not be as easy as it looks like. In the case an
expatriate fails in finishing his assignment he can cause a huge financial loss for the company.
In order to avoid that and to be successful, employees must be trained and offered development
programmes. Thus, it is the role of the HR department to offer in the company a good mix of
practices which leads in the end to individual and organisational performance.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 61 Student ID:1033166
The current paper, aimed to analyze if there is a good mix of HRM practices adopted in five MNEs
operating in Romania and their impact on the organisational performance. Moreover, another point
of focus was to highlight the importance of CCSI for companies in the current economical context.
The findings presented in the current paper show the fact that each company has a different way of
doing business. More precisely, each of the five MNEs participating at this study is adopting a
different mix of HRM practices and achieves organisational and individual performance. Even if they
achieve performance, employees are not 100% satisfied with their jobs and with the programmes
offered by their companies.
Thus, MNEs should be more careful with their employees by offering them training and
development programmes in order to enhance their performance. At the moment, companies adopt
a rigorous selection process, followed by few trainings which are mostly trainings aimed to develop
their technical skills, and then few development programmes.
In order to be successful, expatriates must have strong personal and cross-‐cultural skills. To develop
this, even if their current practices are bringing good results, companies must adopt new ways for
recruiting and training.
This paper aims as well to present CCSI and its implications in the current global economical
environment. The CCSI Situational Judgement Test was presented in the present paper a tool that
should be adopted by most of the companies which are doing business in a cross-‐cultural
environment. After analyzing the findings, a very interesting statement can be concluded: Even if at
the moment the present practices are successful, CCSI SJT is a tool that should be adopted in order
to improve the chances to achieve superior organisational performance by companies operating in
an international environment.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 62 Student ID:1033166
6.3. Research contribution
The findings from the study offer a contribution to the knowledge of HRM practices and CCSI. This
study provided theoretical and empirical evidence on the link between HRM practices, CCSI and
organisational performance. Moreover, this research found out that in the five MNEs participating at
this study and operating in Romania, there is a good mix of HRM practices. Even so, practices should
be improved by offering more trainings and development programmes to the employees and by
adopting the CCSI SJT.
6.4. Research limitations
Although, the study provides a significant contribution for companies operating in Romania, there
were a couple of limitations. First of all, it is important to mention the fact that the present study
was conducted in only five MNEs, with a total number of fifty participants. Thus, the findings cannot
be generalised for all the MNEs operating in Romania.
6.5. Recommendation for future research work
Having in consideration the limitations of this study, and the fact that it was restricted to employees
working in Romania, further research should be conducted by analyzing more companies from
different countries. By doing so, the present study will gain more credibility. Moreover, future
researchers should focus more on analyzing CCSI’s importance and impact on organisational
performance, by conducting the study on a larger sample of participants.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 63 Student ID:1033166
LIST OF REFERENCES:
ANALOUI, G. (2004), “Managerul si liderul – O abordare comparative”, in Stoica – Constantin, A.(ed.), Eu si psihologia creativitatii, Editura Performantica, Iasi
ASCALON, E., SCHLEICHER, D., BORN, M., (2008), “Cross-‐cultural social intelligence: An assessment for employees working in cross-‐national contexts”, Cross Cultural Management, Vol.15 no. 2, pp. 109-‐130
BAMBER, GJ., (1998), “International and Comparative Employment Relations.”, Lansbury RD, Allen & Unwin, Sidyney
BATEMAN, T., SNELL, S. (2004). Management: The new competitive landscape (6th ed.). New York: McGraw-‐Hill
BATT, R., (2002), “Managing customer services: human resources practices, quit rates, and sales growth”, Academy of Management Journal, Vol. 45 no.3, pp. 587-‐597
BECKER, B.E., HUSELID, M.A., PICKUS, P.S., SPRATT, M.F., (1997), “HR as a source of shareholder value: research and recommendations”, Human Resources Management, 36:39-‐47
BIRD, A., FANG, T., (2009), “Cross Cultural Management in the Age of Globalization”, International Journal of Cross Cultural Management, Vol. 9(2), pp 139-‐143
BOSELIE, P., DIETZ, G., BOON, C., (2005), “Commonalities and contradictions in HRM and performance research”, Human Resources Management Journal, Vol. 15 no.3, pp. 67-‐94
BOVEE, C., THILL, J., MESCON, M., (2007), “Excellence in Business”, 3rd edition, USA: Pearson Education
BOWEN, D.E., OSTROFF, C., (2004), “Understanding HRM-‐Firm Performance Linkages: The Role of the ‘strength’ of the HRM System”, Academy of Management Review, Vol.2004 No.2, pp.203-‐221
BRYMAN, A.& BELL, E. (2007), Business Research Methods. 2nd ed. Oxford: Oxford University Press.
CALIGIURI, P.M., (2000), “Selecting expatriates for personality characteristics: a moderating effect of personality on the relationship between host national contact and cross-‐cultural adjustment”, Management International Review, Vol. 40, No. 1, pp. 61-‐80
CAPITAL (2004), “Managerii vor tot mai multe cursuri de formare si perfectionare, dar pe bani putini”, Capital, No.8, February 19.
CAPPELLI, P., NEUMARK, D., (2001), “Do high-‐performance work practices improve establishment-‐level outcomes?”, Industrial and Labor relations Review, Vol. 54 no.4, pp. 737-‐775
COLLIS, J. & HUSSEY, R. (2003) Business Research: A practical guide for undergraduate and postgraduate students, 2nd Edition. New York: Palgrave Macmillan CONSTANTIN, T., POP, D., (2006) ”Romanian managers and human resource management”, Journal of Organizational Change Management, Vol.19, No.6
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 64 Student ID:1033166
CROCITTO, M., SULLIVAN, S., & CARRAHER, S. (2005), “Global mentoring as a means of career development and knowledge creation”, Career Development International, 10, 522-‐535.
DERESKY, H., (2006) “International Management: Managing Across Borders and Cultures.”, 5th Ed. Prentice Hall. Pp. 6, 14-‐15, 17-‐18, 21, 23, 32, 35, 37, 83, 130.
DESSLER, G., (2004), “Human Resources Management”, Pearson College Div: Harlow
DISTEFANO, J.J., MAZNEVSKI, M.L., (2000), “Creating values with diverse teams in global management”, Organizational Dynamics, Vol.29 no.1, pp.45-‐63
DRUCKER, P F. (2008) “Managing Oneself.”, 1st Ed. Harvard Business Press
EARLY, P.C. (2006) “Redefining interactions across cultures and organizations: moving forward with cultural intelligence”, Research in Organizational Behavior, VOl.24, pp. 271-‐99
ERDOGAN, Z., UZKURT, K., (2010), “Effects of ethnocentric tendency on consumers’ perception of product attitudes for foreign and domestic products”, Cross Cultural Management: An international Journal
FENWICK, S.M., DE CLERI, H.L., WELCH, D., (1999), “Cultural and Bureaucratic Control in MNEs: The Role of Expatriate Performance Management”, Management International Review, Special Issue 1999/3, pp.107-‐124
FINK, G., KOELING, M., AND A-‐K NEYER (2005), “The Cultural Standard Method,” EI Working Paper no.62, Europe Institute (university of Economics and Business Administration), Vienna
FINK, G., NEYER, A., KOLLING, M., (2006), “Understanding cross-‐cultural management interaction”, Int. Studies of Mgt. &Org., vol.36, no. 4, pp. 38-‐60
FONTAINE, R., (2007), “Cross-‐cultural management: six perspectives”, Cross Cultural Management: An international Journal”, Vol. 14, No.2, pp 125-‐135
GARDNER, H., (1983), “Frames of Mind:The Theory of Multiple Intelligences”, .pdf
GIL-‐WHITE, F., “Is ethnocentrism adaptive?”, http://www.hirhome.com/academic/Ethnocentrism.pdf
GOLEMAN, D., (1998), “What makes a leader?”, Harvard Business Review, Vol.77 No.3, pp.93-‐102
GOULD-‐WILLIAMS, J. (2003), ‘The importance of HR practices and workplace trust in achieving superior performance: A study of public-‐sector organisations’, The International Journal of Human Resource Management, 14 (1) pp.28-‐54
GOULD-‐WILLIAMS, J., (2003), “The importance of HR practices and workplace trust in achieving superior performance: a study of public-‐sector organizations”, International Journal of Human Resources Management, 14:1, 28-‐54
GREENGARD, S., (2004), “What’s in store for 2004?”, Workforce Management, Vol.82, No.8, pp.54-‐55
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 65 Student ID:1033166
HARRISON, L., E., HUNTINGTON, S.P. (2006), “The Central Liberal Truth: How Politics Can Change a Culture and Save It from Itself”. New York: Oxford University Press
HIGHTOWER, D.F., (1993), “Creativity in your business too!”, Planning Review, 21(5), pp.54-‐56
HILL, C., (2007), “International Business” (6th ed.), New York: McGraw-‐Hill
HILTROP, JM., (1999), “The use of HRM practices in international and domestic organisations.”, New Zealand Journal of Industrial Relations 24(1):, pp. 47-‐61
HILTROP, JM., (2002), “Mapping the HRM practices of international organizations”, Strategic Change 11, pp 329-‐338
HITT, M.A., BIERMAN, L., SHIMIZU, K., KOCHHAR, R., (2001), “Direct and moderating effects of human capital on strategy and performance in professional service firms: a resource-‐based perspective”, Academy of Management Journal, Vol. 44 no.1, pp. 13-‐28
HOFSTEDE, G. (1980), “Culture’s Consequences, Sage, Thousand Oaks, CA
JACK, D., STAGE, V., (2005), “Success Strategies for Expat”, Vol.59, Iss.9, pp. 48-‐ 54, https://login.v-‐ezproxy.brunel.ac.uk/login?url=http://proquest.umi.com/pqdweb?index=19&did=898719611&SrchMode=1&sid=2&Fmt=4&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1295378686&clientId=29708
JACK, D., STAGE, V., (2005), “Success Strategies for Expat”, Vol.59 no.9, pp. 48-‐54
JASAWALLA, A., TRUGLIA, C., GARVEY, J., (2004), “Cross-‐cultural conflict and expatriate manager adjustment; An exploratory study”, Management Decision, Vol. 42 no.7, pp.837-‐849
JING, S., BING, X., (2010), “A study on transnational enterprise faces cultural difference and trans-‐culture management under economic globalization background”, Vol. 6 Iss.2, pp 48-‐56, http://web.ebscohost.com.v-‐ezproxy.brunel.ac.uk:2048/ehost/detail?hid=8&sid=e7d15769-‐4013-‐4ec2-‐949b-‐8ad9094ebc4b%40sessionmgr10&vid=1&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=a9h&AN=52225254
KRAMAR, R., (2005), “HRM Practices and Performance”, Asia Pacific Journal of Human Resources, Vol. 43 no.1, pp. 4-‐5
LEGGE, K. (2005), Human Resource Management Rhetories and Realities. Anniversary Ed. Great Britain: Palgrave Macmillan
MERIAM., (2010), Personality Test, http://www.merriam-‐webster.com/dictionary/personality%20test
PAAUWE, J., BOSELIE, P., (2005), “HRM and performance: what next?”, Human Resources Management Journal, Vol. 55 no.4, pp. 68-‐83
PARSONS, T., SHILLS, E., (1962), “Values, Motives and System of Action” In Toward a General Theory of Action, ed.T.Parsons and E. Shills, 47-‐233. Cambridge: Harvard University Press.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 66 Student ID:1033166
ROBBINS, S., COULTER, M. (2009) Management. 10th Ed. Pearson Publishing. Pp. 93, 95-‐97, 118.
SANCHEZ, J.I., SPECTOR, P.E., COOPER, C.L., (2000), “Adapting to a boundaryless world: a developmental expatriate model”, The Academy of Management Executive, Vol.14 No.2, pp.96-‐106
SAUNDERS, M., LEWIS, P., THORNHILL, A., (2007), “Research Methods for Business Students”, Financial Times/Prentice-‐Hall, London
SEKARAN, U. (2000), Research Methods for Business. 3rd ed. United States of American: John Wiley & Sons.
SHIH, H.A., CHIANG, Y.H., KIM, I.S., (2004), “Expatriate performance management from MNEs of different national origins”, International Journal of Manpower, Vol. 26 no.2, pp.157-‐176
TEO, S.T.T., (2002), “Complexities and controversies in linking HRM with organizational outcomes”, Journal of Management Studies, Vol. 38 no.8, pp. 1121-‐1149
THERIOU, G.N., CHATZOGLOU, P.D., (2009), “Exploring the best HRM practices – performance relationship: an empirical approach”, Journal of Workplace Learning, Vol.21 No.8, pp. 614-‐646
TRIANDIS, H.C., (2000), “Culture and conflict”, International Journal of Psychology, Vol.35 No.2, pp 145-‐152
UNKNOWN, “Social Interaction”, http://fds.oup.com/www.oup.co.uk/pdf/bt/fincham/Chapter6.pdf
UNKNOWN, http://www.allaboutphilosophy.org/ethnocentrism-‐faq.htm
WALLIMAN, N. (1995), Your Research Project: a step-‐by-‐step guide for the first time researcher. Great Britain: Sage Publications Ltd.
WEDERSHPAN, G., (2002), “Expat training”,Vol. 56, Iss.2, pp 67, http://proquest.umi.com.v-‐ezproxy.brunel.ac.uk:2048/pqdweb?index=27&did=106971420&SrchMode=1&sid=2&Fmt=4&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1295378954&clientId=29708
YEATON, K., HALL, N., (2008), “Expatriates: Reducing Failure Rates”, The Journal of Corporate Accounting & Finance, March-‐ April, pp. 75-‐78
YUAN, W., (2010), “Conflict management among American and Chinese employees in multinational organizations in China”, International Journal, Vol 17 no.3, pp. 299-‐311
ZIKMUND, W.G., (2003), “Business Research Methods”, 7th ed.,Thomson, South-‐Western, Mason, OH
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 67 Student ID:1033166
APENDIX A Title of research: “HRM practices – CCSI and its importance in achieving superior organisational performance: A study of foreign MNEs operating in Romania”
Researcher: Ms. Roxana Buzetelu, Student of MSc International Business, Brunel Business School, Brunel University
Contact Information E-mail: [email protected]
Many thanks for agreeing to participate in my research project. The project has to be completed in part fulfilment of my degree programme and so your assistance is much appreciated.
Purpose of the research: The main idea of this study is to investigate Human Resources Management practices in five Multinational Enterprises operating in Romania. Also, another point of focus is to examine Cross Cultural Social Intelligence and its impact on achieving superior organisational performance.
What is involved in participating: I will ask you to complete a questionnaire which will help me in my research. Your signature below serves to signify that you agree to participate in this study.
The questionnaire is divided in 3 sections. The first and third part contains questions which have multiple choice answers, statements that you either agree or disagree. The second part of the questionnaire contains open ended questions. Your participation is voluntary and you can choose to decline to answer any question or even to withdraw at any point from the project. Anything you say will only be attributed to you with your permission: if not, the information will be reported in such a way as to make direct association with yourself impossible.
Confidentiality also means that the background information form and questionnaire will be coded and stored in such a way as to make it impossible to identify them directly with any individual (e.g. they will be organized by number rather than by name).
Consent:
I wish to be identified in the report: (please put a X) YES ____ NO____
I have read the above information and I agree to participate
in this study ______________________________
Researcher’s signature: _________________________________
Date: _________________
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 68 Student ID:1033166
APPENDIX B
Dear Participant,
Please answer the following questions. The questionnaire is consisted of three parts: Part 1,
Part 2 and Part 3. Part 1 and Part 3 are consisted by closed questions and you can choose
only one of the bellow answers, while part 2 is consisted of open ended questions.
Part 2a is addressed to expatriates, while Part 2b is addressed to Romanian employees.
Please choose only one number in order to show the extent you agree or disagree with each
statement as is shown below:
1= totally agree
2= agree
3= Neutral
4= disagree
5= totally disagree
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 69 Student ID:1033166
CLOSED QUESTIONS EXAMINING THE USE OF HRM PRACTICES
PART 1
Strongly Agree
Agree Neutral Disagree Strongly Disagree
1 2 3 4 5
I am provided with sufficient opportunities for training and development.
Team working is strongly encouraged in our department.
A rigorous selection process is used to select new recruits.
When new management positions come up, the department normally tries to fill them with people from within the department or authority rather than recruiting from outside.
This department tries to relate your pay with your performance in some way.
Management involves people when they make decisions that affect them.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 70 Student ID:1033166
OPEN QUESTIONS –EXAMING EXPATRIATE OPINIONS REGARDING HRM PRACTICES
PART 2a
PLEASE ANSWER THE FOLOWING QUESTIONS:
1. What were the key challenges you faced during each overseas assignment?
2. What types of training (and other types of support) did you receive from your firm
before starting/during any new assignment?
3. What are your recommendations for future preparation of expatriate managers?
4. What are your recommendations for HR managers when starting new assignments
with expatriate managers?
5. Have you ever been asked to complete a cross-cultural situational judgement test?
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 71 Student ID:1033166
OPEN QUESTIONS –EXAMING ROMANIAN EMPLOYEES OPINIONS REGARDING HRM PRACTICES
PART 2b
PLEASE ANSWER THE FOLOWING QUESTIONS:
1. What are the key challenges you faced during overseas business trips?
2. What types of training (and other types of support) did you receive from your firm in
order to better understand the people from other cultures that you are working with?
3. Do you consider that the expatriate managers did a good job during their assignments
in this company?
4. What are your recommendations for future preparation of expatriate managers?
5. Have you ever been asked to complete a cross-cultural situational judgement test?
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 72 Student ID:1033166
CLOSED QUESTIONS EXAMINING CCSI ANDTHE INDIVIDUAL AND ORGANISATIONAL
PERFORMANCE
PART 3
Strongly Agree
Agree Neutral Disagree Strongly Disagree
1 2 3 4 5
I can recognize and understand (non)verbal cues of persons form a variety of cultures
I can make accurate social inferences in a variety of cultural contexts
I can accomplish relevant social objectives across cultural negotiations and interactions through one’s acceptance and understanding of other cultures
Overall I am very satisfied with my job and could not be more satisfied.
I sometimes feel like leaving this employment for good.
HRM PRACTICES – CCSI AND ITS IMPORTANCE IN ACHIEVING SUPERIOR ORGANISATIONAL PERFORMANCE: A STUDY OF FOREIGN MNES OPERATING IN ROMANIA
Roxana Buzetelu 73 Student ID:1033166
I feel myself to be part of the department.
In my work I like to feel I am making some effort, not just for myself but for the department as well.
I seek out training and other ways of improving my performance at work
This department provides excellent service
This department performs really well
THANK YOU!