Assessing the extent of synergy which is centralized on HR prescription and HR bundles reality in this assignment shall be outlined in the Daimler AG, an organization registered under DAX companies in Germany. Daimler is one of the most accredited manufacturers of luxury and heavy commercial vehicles and accessories in the world. According to Beverly (1986) the operation of this multimillion organization commenced in the early 1880s, Daimler Benz was founded by two German locomotives engineers Gottlieb Daimler and Carl Benz, and they were intrigued in making internal combustion engine and later perfected to making fuel driven vehicles. This organization ownership is a publicly traded corporation and employs globally around 280,000 employees. This organization has been rated by the Global fortune to be the number 23 of the wealthiest organization in the world. This is with the credential of having a net income of US$2 billion and an accumulative of total revenue of US$140 billion as echoed by Mattera (2000).

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Human Resources Culture and Bundles
Assessing the extent of synergy which is centralized on HR prescription and HR bundles
reality in this assignment shall be outlined in the Daimler AG, an organization registered under
DAX companies in Germany. Daimler is one of the most accredited manufacturers of luxury and
heavy commercial vehicles and accessories in the world. According to Beverly (1986) the
operation of this multimillion organization commenced in the early 1880s, Daimler Benz was
founded by two German locomotives engineers Gottlieb Daimler and Carl Benz, and they were
intrigued in making internal combustion engine and later perfected to making fuel driven
vehicles. This organization ownership is a publicly traded corporation and employs globally
around 280,000 employees. This organization has been rated by the Global fortune to be the
number 23 of the wealthiest organization in the world. This is with the credential of having a net
income of US$2 billion and an accumulative of total revenue of US$140 billion as echoed by
Mattera (2000).
However, in 2007 the profile of this company declined after the sale of Chrysler a U.S
carmaker which they had merged for nearly nine years. With this fact and the HR malpractices
which have cost this organization lot of millions of Dollars to settle out litigation ranging from
discrimination to bribery charges (Morris & Jones, 1993). Majority of these malpractices that
have made and tainted the image of this corporation are the fruit of unethical practices from the

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HR sector. This outlines the relationship of what the HR department is supposed not to be doing
and the reality of the HR department should be doing in the organization. These malpractices
range from corruption charges, labor, discrimination and unethical working hours (MacDuffie,
1995).
Labor
Daimler AG has been from time memorial been hit with unethical working conditions
and cheap labor in most foreign countries which it has been established. However, this
organization has been closely linked with unions from the later days. However, it is articulated
that the HR usually pays off the union members to remain mum on issues of recruitment
discrimination and odd working hours with little compensation (Vlasic & Stertz, 2000). Most of
the countries that this organization has been setup there have been cries of foul play from the
member employees who constantly complain outside the union of odd working hours and low
wages. Recently in it home town Germany Daimler was estranged with the union IG Metalla's
national strike. The strike objectives were reduction of the working hours into standard work
week’s hours which are normally 35 hours. This organization had been overloading the taskforce
with 40 hours working shift weekly. Earlier the union had been suffocated by the HR demand
that the organization was in the verge of reconstruction and thus extra hours were need to beat
off the competitive market. The condition further deteriorated after the sale of Chrysler. The
workers started crying foul with the union and basing on the recent corruption charges by this
organization there were allegation that were implied that some of the union staff were bribed to
muffle others by Daimler HR department (Porter, 1985).
The strike reduced the working hours and also the inhumane condition that the employees
acclaimed that they are exposed to while working in this plant. According Althauser and

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Kalleberg (1981) the working hours were reduced and the payments remained constant. Globally
the relation between the union and Daimler HRM has been very grim and there usually outcries
that the union are not for the employees and are manipulated by the HR department.
The 1998 meeting of all major Daimler HRM and union there were tension when
recruiting issues and discrimination were raised mostly in regions like South Africa and Brazil.
Even with Daimler signatory in 2002 to social responsibility agreement which included different
nation which was under the umbrella auspice of International Metalworkers Federation, this
organization has been hit with series of labor associated litigation in most of the host countries
where it has establishment (Amabile, 1983). When Daimler merger with Chrysler was negotiated
then the HR later initiated an initiative which would later be rejected by the workers, the right to
work resistance also saw rejection of the union advice in Deep South which oversaw the
thwarting of the United Auto Worker’s plan in Alabama. The decision that the HRM devised
would later see off the plant organization. This are the futile effort that the HRM at Daimler has
been deploying to suppress the workers who were employed in this organization while fattening
their pocket through low wages which does not benefit the organization but benefit them
individually as echoed by Miles and Snow (1994).
HRM prescription in such cases allows that the plight of the employees be heard. The
ethical moral which underpins recruitment and union does not much involve HRM having too
excess power and dominance (Huselid, 1995). However, the HR in Daimler AG has been another
picture all together; they have been manipulating their way even in the union where workers are
deemed to find solace when oppressed in the working sphere.
Work Place Safety

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Work place safety has also been another major controversy of how the HR has been
handling this issue. Due to the working condition filled with machinery Daimler insurance
policies are questionable. Usually after the mergers which are basically initiated by the HRM,
Daimler either when merging or selling their first priority is usually how they would evade
paying insurance interest to their workers (Arthur, 1994).
This organization together with the likes of Ford and GM has been at logger heads with
safety, workplace safety and pollution controversies. According Delery and Doty (1996) one of
the flare up of this kind which the HR attempted to cover up flared during the Daimler and
Chrysler merger. The workers were complaining of the safety precaution which the organization
set up soon after the acquisition. Later the HR finding their position faulty accosted Daimler
settlement charges which amounted to $540,000 which were purported by U.S. federal
government’s National Highway Traffic Safety Administration on allegation that the HRM
attempted to cover for the organization faulty fuel line defects and the issues in the clutch of their
Ram trucks. Other defects which should had been reported but the HRM offered to cover up
included faulty lock in their minivans and suspension issues on the same vehicle (Cappelli &
Singh, 1992).
After a lot of pressure from U.S Environmental Protection Agency to relegate the amount
of green gas emission DaimlerChrysler HRM cried foul and attempted also to cover up this issue.
However, later in 2005 they were slapped with a lawsuit which resulted to compensatory of $90
million which was in violation of the Clean Air Act. These was in due process of the
organization attempt of covering up for the defective catalytic convertor in their Jeep and Dodge
model produced in the year 1996 through to 2001 (Doeringer & Poire, 1991). Later on the same

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year the organization would also pay civil penalties amounting to $1.2 million after another
model of imported Mercedes showed similar defects.
According to Crocker-Hefter (1996) proper procedure which the HRM would have taken
when this defect were noticed would be repair then when they were still in production. However,
the unethical strategy that this department took was cover up the whole thing and hoped that it
would not be noticed. This has accosted Daimler a huge amount of money. Thus is the
appropriate measures would had been enforced then the organization would be now coining new
innovation but there are now concentrating on precautionary measures when their competitors
are inventing new models (Guest, 1997).
Corruption
The HRM of Daimler has been viewed to be one of the most corrupt departments which
have accosted this organization billions from litigations. During the fall of 2001 the HRM of
Daimler had perfected the art of defaulting competitive rules; they had done so through
restriction of cross-border sales on majority of their Mercedes brands in Europe. Through this
they had limited the competition in prices among dealers and therefore settling to earn a
scrupulous earning from these deals (Vlasic & Stertz, 2000). However, this scandal was short
lived because the European Union found this organization in violation of competitive rules and
consumer protection rights and was fined US$65 million which was later reduced to $12 through
the intervention appeal in the EU’s Court of Justice.
Best practice of HR does not allow scrupulous deals to be executed even though they
benefit the organization this is because in the eventuality of thing the organization stand to loose,
this is mostly under this department in the risk management charter as noted by Pfeffer (1994).
HRM should have accessed the risk that they would be submitted to in the result that this might

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turn around against them. However, the HRM secured this internally by sacking all those whistle
blowers within the organization they articulated that they had solved the equation neglecting the
reality that the problem was not only noticeable from within but also from outside being in the
scrutiny of their competitors blood thirsty jaws (Mills, 1985).
Under this misdemeanors by the HRM Daimler paid a whooping US$185 million in the
settlement of bribery charges which was aired under the U.S. Foreign Corrupt Practices Act.
Seven HR managers were arrested after pleading guilty to corruption charges affiliated with
bribery. Dyer and Holder (1988) notes that this organization was alleged that within the majority
of the countries that they operate all their tenders had been achieved through bribery. The
charges involved 22 nations where the HRM had induced monetary gist to woo representatives to
award hem governmental tenders. Also found guilty were two Daimler subsidiaries in this nation
where the offence took place. Due to low demand of military artifact which Daimler benefits
from such tenders the HR had devised scrupulous means of getting tenders which are out of their
jurisdiction like supply of governmental executive vehicles and other transport facilities (Kanter,
1983; Peck, 1994).
Proper HR ethical practices which all organization that are pursuant to innovation should
adherer to be usually relied on theoretical assumptions which identified morals and abides by
them. MacDuffie (1995) adds that following different HR prescriptions which have high ethical
morals and practices usually are paramount within innovative HRM setup and adhere to high
grade of internal consistency and communication from all the involved members of this juncture.
For this prescription to flourish then the basis has to be first on the best interest of the firm. The
strategic link that is based on the theme innovation would allow the HR to fully embark on
making sound decision which would generate interest for the whole organization for the benefit

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of all the stakeholders. The theoretical foundation which all successful HRM underpins is based
on the theory of the objectives and the goals which are set out by the organization. They are not
based on personal gains or greed and serve others regardless of the competitive market condition.
They also uphold all customer protection rights as well as the competition fair rights of their
fellow competitors which would reduce the chances of litigation which are unnecessary like the
ones which Daimler has been succumbed with due to HRM irregularities here and there as
echoed by Guest (1997).
Jackson (1987) articulates that because there is close link in relation between HR and the
organization success, then it would be right to articulate that communicating with all the
stakeholders would ensure that the organization stays on top without having to bribe it way to the
top, later to be filled with many litigation which surmount to huge compensation. Proper
planning and best practices would ensure that all of this is assigned and adapted. Some of these
best practices which Daimler should adapt are selective recruitment, incentive pay, promotion
from within, high wages and employee’s ownership. This would safe guard any future
inconsistencies within the organization. From here they would be able to woo the outside market
easily, this are the best external environmental influence needed also to attract business
prospectors in future other than through corrupt means of bribery (Mattera, 2000).
Racial Discrimination
The area that has dented the best practice of Daimler AG HRM is racial discrimination in
selective recruitment in most of the majority of the nation that this organization is based. The
selective nature that Daimler applies when recruiting has been under scrutiny from the time of
this organization founding (Beverly, 1986). Like a hierarchy this tradition has rocked this
organization to present time. This has resulted to loss of finances through litigation from

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different parties nearly now and then. The litigation raging from promotion discrimination based
on race or gender and financing of car loans by clients. Recently in early 2000 Daimler settled a
lawsuit of $9 million on finance discrimination charges in the U.S. the charges were that
DaimlerChrysler over drafted the interest when they were financing Latinos and African
American exceeding the interest high above their white clients (Dyer & Holder, 1988).
This lawsuit was settled in the year 2005, the HRM then forced this organization to cough
another $3 million to training and educate employees in the sale department on ethical issues
which they would have mitigated themselves as noted by Schuler (1987). Another discrimination
case is the recent development which alleges that Daimler and other organization supported the
oppression and the apartheid in South Africa. This organization has been associated with
supplying the regime under the apartheid movement with utilities to oppress the black’s minority
in this region. Although it has not been proven if they truly were involved, based on their record
of arsenal production in majority of the wars, if found guilty this organization is going to pay
dearly as noted by Goodman (2010). However, if there were HRM prescription based on best
practices this behavior would have been mitigated. All these organizations now need is
innovation in the HR department and major shake up here and there with appropriate strategy to
balance the imbalances and restore sanity to Daimler AG (West & Farr, 1990).

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