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Managing Multi Cultural Issues in HR Strategy


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Managing Multi Cultural Issues in HR Strategy

  1. 1. National HRD Network Webinar on Managing Multi Cultural Issues in HR Strategy July 29, 2009 3:00-4:00 PM IST
  2. 2. HR STRATEGY on “ Managing Multi Cultural Issues” S.Y.SIDDIQUI Managing Executive Officer Admn. (HR / FINANCE / IT) Maruti Suzuki India Ltd.
  3. 3. Multi Cultural Aspects in HR……. <ul><li>Employee ~ Population Mix </li></ul><ul><li>Work Culture Impact </li></ul><ul><li>Mix of the Top Management Team </li></ul><ul><li>Link with the parent Company~ Collaborator </li></ul><ul><li>Human Resources policies </li></ul>
  4. 4. Multi Cultural Aspects in HR……. <ul><li>Employees ~ Population Mix </li></ul><ul><li>- In the Indian business situation </li></ul><ul><li>- Outside India in an overseas location </li></ul><ul><li>- Social & Cultural habbits ~ food ~ atiquettes </li></ul><ul><li>- Management & Leadership styles </li></ul><ul><li>- Adaptability to alien context ~ Culture ~ working </li></ul>
  5. 5. Multi Cultural Aspects in HR……. <ul><li>Work Culture of the Company </li></ul><ul><li>- US Multinational,Japanese,European,Korean or Indian </li></ul><ul><li>- Joint Venture Company </li></ul><ul><li>- Core values, Management Style, Key Policies </li></ul><ul><li>- Systems, Processes & Work Practices </li></ul><ul><li>- Code of conduct formal & informal </li></ul>
  6. 6. Multi Cultural Aspects in HR……. <ul><li>Mix of the Top Management Team </li></ul><ul><li>- American + Indian </li></ul><ul><li>- Japanese + Indian </li></ul><ul><li>- American + European + Indian </li></ul><ul><li>- All Expatriates </li></ul><ul><li>- All Indians </li></ul>
  7. 7. Multi Cultural Aspects in HR……. <ul><li>Link with the Parent Company ~ Collaborator </li></ul><ul><li>- In case of an MNC or Joint Venture or 100% owned </li></ul><ul><li>subsidiary </li></ul><ul><li>- Influence of company vision, core values & top </li></ul><ul><li>leadership style </li></ul><ul><li>- Related impact on business strategy & plan and its link </li></ul><ul><li>to HR Strategy : Work Culture, HR Policies & Work life </li></ul>
  8. 8. Multi Cultural Aspects in HR……. <ul><li>Human Resource Policies </li></ul><ul><li>- Working days, working hours, leaves & holidays </li></ul><ul><li>- Organization design & structure </li></ul><ul><li>- Manpower Planning, Hirings & Induction </li></ul><ul><li>- Compensation & Benefits management </li></ul><ul><li>- Performance & Potential Management </li></ul><ul><li>- Expatriation in & Expatriation out </li></ul>
  9. 9. Glimpse of some real issues…. <ul><li>Work Culture </li></ul><ul><ul><li>Tendency of parent company in case of MNCs to have same work culture in an overseas company </li></ul></ul><ul><ul><li>Disconnect between parent company culture & the local context e.g. Indian subsidiary </li></ul></ul><ul><ul><li>Misunderstanding due to lack of sensitization of local social structure & cultural context </li></ul></ul><ul><ul><li>Impact on the blue collar workers ~ union </li></ul></ul><ul><ul><li>Morale, motivation, ownership & commitment of the work force </li></ul></ul>
  10. 10. Glimpse of some real issues…. <ul><li>Compensation & Benefits </li></ul><ul><ul><li>Relatively low annual Salary increase compared to Indian context </li></ul></ul><ul><ul><li>Simple & compact salary structure without any consideration to tax savings etc </li></ul></ul><ul><ul><li>High focus on variable Pay & bonuses and Cash element rather than fixed salary & long term benefits </li></ul></ul><ul><ul><li>Clear link of Individual performance to variable pay and annual salary review </li></ul></ul><ul><ul><li>Strong link of financial performance of the company to define variable pay & Salary decisions </li></ul></ul>
  11. 11. Glimpse of some real issues…. <ul><li>Job Security ~ People Orientation </li></ul><ul><li>Relocation, No Increase, Salary cut, Pink Slips or Downsizing in case of: </li></ul><ul><ul><li>Economy/business downtrend or recession </li></ul></ul><ul><ul><li>Non performance of an employee </li></ul></ul><ul><ul><li>Acquisitions or mergers of companies </li></ul></ul><ul><ul><li>In case of restructuring </li></ul></ul><ul><ul><li>In case of closure of business/plants </li></ul></ul>
  12. 12. Managing multi cultural teams <ul><li>Equal participation with ability of sensitive listening </li></ul><ul><li>Respect for each other </li></ul><ul><li>Understanding the unique cultural context </li></ul><ul><li>Inter-personal relations </li></ul><ul><li>Initiative & Adaptability </li></ul>
  13. 13. The MSIL Experience
  14. 14. Phase I : (1983; SMC-24%, Govt. of India – 76%) Market Dominance Production Orientation Trade Union perspective Phase II : (1995; SMC-50%, Govt. of India – 50%) Prod., M&S & People Perspective Emergence of Competition Customer Orientation Phase III : (2007; SMC-54.2%, Listed on Stock Exchange) Intense Competition Emphasis on Engg. Capability Marketing Orientation &Talent perspective Maruti Suzuki : Glimpse of Last 25 Years
  15. 15. Multi culture in MSIL’s context <ul><li>Maruti Suzuki India Ltd is a classic example of a balanced mix of Indian & Japanese culture & management styles: </li></ul>Japanese Long-term and detailed Planning Process Long term employment relationship High orientation to Systems/Work Practices Strong character & commitment Budgeting Process- Cost Savings/ Reduction Slow/Lengthy Decision Making Focus on Micro business processes Indian Rich in tradition & culture High emotional quotient High versatility ~ adaptability Job security Orientation towards participative style High sense of belongingness Company & family connect
  16. 16. MSIL Organization Structure <ul><li>MSIL has evolved the concept of “Paired Leadership Model” </li></ul><ul><li>Introduction of “Managing Executive Officer System” with focus on: </li></ul><ul><ul><li>Policy Formulation & Key Decisions at the Board level </li></ul></ul><ul><ul><li>Execution of Key Policies & Decisions in day to day operations </li></ul></ul><ul><li>Benefits of the new organization Structure: </li></ul><ul><ul><li>Improved clarity & focus on key Management responsibilities </li></ul></ul><ul><ul><li>Harmonization, leading to reduced compartmentalization </li></ul></ul><ul><ul><li>Improved Coordination, across the functions </li></ul></ul><ul><ul><li>Improved Speed in Decision Making </li></ul></ul><ul><ul><li>Development & Career Enhancement Process of Indian Professionals </li></ul></ul>
  17. 17. MSIL’s Focused Training Interventions <ul><li>A well defined training module has been initiated at middle & senior management level to: </li></ul><ul><ul><li>Strengthen the bond </li></ul></ul><ul><ul><li>Address multicultural issues related to both Japanese and Indian employees. </li></ul></ul><ul><li>The training programs have been initiated with focus on: </li></ul><ul><ul><li>Creating Team Synergy </li></ul></ul><ul><ul><li>Promoting culture of innovation </li></ul></ul><ul><ul><li>Enhancing risk taking abilities </li></ul></ul><ul><ul><li>Developing Cultural Sensitivity </li></ul></ul><ul><li>Language training has been brought in to bridge the language barrier; Specialized interpreters have been roped in to facilitate better understanding </li></ul><ul><li>Effective communication across the company on regular basis across all levels division. </li></ul>
  18. 18. HR Ground Realities :Indian Context <ul><li>Human Resources Management, is strongly influenced by </li></ul><ul><ul><li>Local Culture, </li></ul></ul><ul><ul><li>Social Norms & </li></ul></ul><ul><ul><li>Local Beliefs and Practices </li></ul></ul><ul><li>Why few MNCs fail to be successful in India??? </li></ul><ul><ul><li>A common mistake - overlooking the local ground realities under the unconscious bias of their parent Corporate Culture, Policies & Practices </li></ul></ul><ul><li>People management in India or any other alien overseas operation cannot be successfully managed in any “Japanese” or “American” or “Korean” or “European” way </li></ul>
  19. 19. HR Ground Realities :Indian Context <ul><li>HR policies, systems & practices based on the culture & core values of the parent company may or may not work in the Indian context </li></ul><ul><li>Key to success lies in embracing flexibility, understanding, acceptance, respect & adaptability to the local ground realities </li></ul><ul><li>Collaborative process of gradual change through trust, mutual exchange, training and flexible management approach can help in establishing a strong link & facilitate desired results </li></ul>
  20. 20. HR Ground Realities :Indian Context <ul><li>Maruti Suzuki is the most successful & live example of such business success in India – The Suzuki Way- credit to Chairman O. Suzuki & the SMC Top Management Team. </li></ul><ul><li>The Indian Government thus decorated Chairman O. Suzuki with – PADMA VIBHUSHAN – the highest Indian honor, in 2007 </li></ul>
  21. 21. To sum up… <ul><li>Managing multi culture initiatives help an Organization keep a competitive human resources advantage thru: </li></ul><ul><ul><li>Improved corporate culture </li></ul></ul><ul><ul><li>Improved employee morale & higher retention of employees </li></ul></ul><ul><ul><li>Enabling the organization to move into emerging markets </li></ul></ul><ul><ul><li>Decreased interpersonal conflict among employees </li></ul></ul><ul><ul><li>Increased productivity, innovation & brand identity </li></ul></ul><ul><ul><li>“ DEVELOPING A GLOBAL CORPORATE, A GLOBAL CULTURE & </li></ul></ul><ul><ul><li>A GLOBAL PEOPLE & TALENT POTENTIAL” </li></ul></ul>
  23. 23. Thank you for your participation For Question & Feedback please email at Thanks