MISL chapter Handling the cross-cultural issues within the organization

Human Resource Policies

Work Culture Impact

Mix of the top-tier management

Relations with umbrella organization

Working-population Mix

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HR Policies
Working Days, Working Hours, Leaves & Holidays Conglomerate design & structure Manpower cost/planning/hiring/induction Benefits management & compensation Performance & Potential Management Expatriation in & out PF & miscellaneous fund raising

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Work Culture of the organization

Multinational USA/India/UAE/Japanese/Korean/European Core Values, key policies, management style System, Processes & Work Practices Joint Venture or chained Code of Conduct Formal Informal
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Mix in Top-Management
American+Indian Britisher+Arab National+Indian Japanese+Indian American+Korean+Indian All Expats All Indians
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Relation to the umbrella organization

In case of joint venture, MNC or 100% owned susidary Influence of company vision, core values, company work

culture & top leadership style

Related Impact on business strategy & plan and its link

to HR strategy: Work Culture, HR Policies & Work life

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Employee population mix

Within India business situation Outside India business situation Social & cultural habits Foods & Etiquettes Management & leadership style Adaptation to alien-context culture - working
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Work Culture
Tendency of parent company in case of MNCs to have same work

culture in an overseas company

Disconnect between umbrella company culture & local context. Eg:

Indian Subsidiary

Misunderstanding due to lack of sensitization of local & social

structure & cultural context

Impact of blue collar workers unions Morale, motivation, ownership & commitment of the work force Praful Anchaliya

Compensation & Benefits Relatively low annual salary increase compared to Indian Context Simple & compact salary structure without any consideration to tax savings etc. High focus on variable Pay & bonuses and cash element rather than fixed salary & long term benefits Clear link of individual performance to variable pay & annual salary review Strong link of financial performance of the company to define variable pay & salary decision
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Job Security People Orientation

Relocation, No increase, salary cut, pink slips,

bench or downsizing in case of:

Economic downturn Acquisitions & Mergers of companies Non-performance of employee In case of restructuring In case of closure of business-plants/locations

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Respect for each-other

Inter-personal relations Initiative & Adaptability Understanding of unique cultural context Equal participation Ability of sensitive listening
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At Maruti Suzuki India Ltd.

Please elaborate with basic structure @ Maruti.

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Phase-I

1983- SMC(24%), Govt. of India(76%) Market Dominance Production Orientation Trade Union Perspective

Phase-II

1995-SMC(50%, Govt. of India (50%) Prod., M&S & People perspective Initialization of competition Customer Orientation

Phase-III

2008-SMC(54.2%), Listed in Stock Market Intense Competition Emphasis on Engineering Capability Market orientation & talent perspective

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MISL is a classy example of balanced mix of Indian & Japanese culture in management styles:
Japanese Indian Rich in tradition & culture High emotional quotient High versatility-adaptability Job Security Orientation towards participative style High sense of belongingness Company & family connect

Long-term & detailed process Long-term employment relationship High Orientation to system/work practices Strong character & commitment Budget Process-Cost savings/reduction Slowly/Lengthy Decision Making Focus on Micro-business process

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Evolved a process of Paired Leadership Model

Introduction of Managing Executive Officer System with focus on:
Policy Formulation & Key Decisions at board level Execution of Key Policies & Decisions in day to day operations

Benefits of New organizational structure:

Improved clarity & focus on key management responsibilities Harmonization, leading to reduced compartmentalization Improved coordination across the functions Improved speed in decision making Development & career enhancement process of Indian Professionals
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A well defined training module has been initiated at middle & senior management level to:
Strengthen the bond Address multi-cultural issues related to both Japanese & Indian employees

The training program has been initiated with focus on:

Creating team synergy Promoting culture of innovation Enhancing risk taking abilities Developing cultural sensitivity

Language training has been brought in to bridge the language barrier; Specialized interpreters have been roped in to facilitate better understanding
Effective communication across the company on regular basis across all levels divison
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HRM, is strongly influenced by:

Local Culture Social Norms Local beliefs & practices

Frequent failure of some MNCs:

A common mistake: overlooking the local ground realities

under the unconscious bias of their parent Corporate Culture, Policies & Practices

People management in India or any other alien overseas operation cannot be successful managed in any Japanese or American or Korean or Arab or European way
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HR Policies, system & practices based on the culture & core values of the parent company may or may not work in the Indian Context Key to success lies in embracing flexibility, understanding, acceptance, respect & adaptability to the local ground realities Collaborative process of gradual change through trust, mutual exchange, training & flexible management approach can help in establishing a strong link & facilitate desired results
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Maruti is the most successful & live example of such business success in India The Suzuki Way credit to Chairman O. Suzuki & the SMC Top Management Team. The team Govt. thus decorated Chairman O. Suzuki with PADMA VIBHUSHAN the highest Indian honor in year 2007

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Managing multi-cultural initiatives help an Organization keep a competitive HR advantage through:

Improved corporate culture Improved employee morale & higher retention of employee Enabling the organization to move into emerging markets Decreased interpersonal conflict among employees Increased productivity, innovation & brand identity

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Developing a Global Corporate

A Global Culture

Global People & talent potential

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