3.20 business management report

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Case study

Activity China As a member of the human resource development department of a large multinational corporation you have been given responsibility to devise a programme to prepare managers and other parent company employees who will be working in China.

Prepare a presentation that you might give to these employees, including general information on the country, history, culture, language and customs and work-related attitudes. Use anecdotes and solid examples to illustrate your presentation.

Questions 1 To what extent would you agree with the contention that existing models of HRM fail to

recognise cultural differences, and that this is a weakness given the rapid rate of globalisation?

2 Outline the similarities and differences in terms of the approaches to the management of people in India and China.

3 To what extent would you agree with the view that there is an ‘Asian model of HRM’?

Yummee Biscuits: Part 1

Yummee Biscuits is a large UK-based snack manufac- turer that was set up in the nineteenth century. It is now one of the largest snack manufacturers in the UK. Over the past two decades it has been internationalis- ing its operations, and has acquired companies in the USA and Australia. In 1995 it became involved in a joint venture in the south of the People’s Republic of China (PRC). The Chinese partners were local busi- nessmen who had no prior experience in biscuit-making. Yummee pumped in money and resources, and the Chinese partners set up the land deal. The biscuit factory was built on a greenfield site, and was equipped with state-of-the-art machinery. Work was organised on scientific management (Tay- lorist) lines, with strictly demarcated jobs and close supervision. Yummee took the view initially that it would be best to employ local Chinese managers to run the factory. However, in the following two years numerous problems occurred within the factory. These included problems of quality control, stock control, and failing to deliver orders to customers on time.

Yummee sent out a delegation of senior managers to investigate the problem. They found that many of the problems were related to a lack of managerial skill and poor coordination between different depart- ments. They realised that it had been a mistake to assume that the indigenous Chinese managers could

run the factory to British standards with little support or training. Yummee put all managers through man- agement development training. This included topics such as leadership skills, communication skills, time management skills and dealing with conflict. The training programmes were adapted from pro- grammes that were delivered in the UK. Individual training needs were not assessed. The managers said that they had enjoyed the training, but the trainer felt that there could be an element of politeness involved. There was little improvement in the performance of the subsidiary one year later.

A senior executive from Yummee travelled to the subsidiary to inspect the plant. He sent a report out- lining the key problems in the factory. These were the main points of his report.

Shopfloor problems � There were low levels of motivation within the

shopfloor ranks. Most of the shopfloor workers were from the north of China.

� Shopfloor workers seemed unwilling or unable to take on any level of responsibility.

� There seemed to be little interest in promotion or development opportunities.

� There was no appreciation of hygiene rules and regulations.

Case study

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Yummee Biscuits: Part 2

Yummee Biscuits is now interested in opening a new biscuit factory in Shanghai. It is predicted that the factory will require 800 employees at all levels from senior management to shopfloor workers. The new factory will contain the following departments: human resource management, finance, sales and mar- keting, food production and distribution and quality control. Yummee will install new German biscuit- making machines, as it feels that these are the best on the market at the moment. The machines will be shipped in from Germany. The factory will produce a range of savoury and sweet biscuits.

Yummee has already purchased a site and expects the building to be complete by December 2007. It would like to put in place a skeleton staff in Novem- ber and have full staffing in place by the end of December. It is especially keen to ensure that the fac- tory produces quality products from the beginning and that production is brought online as smoothly as possible. The new factory will include a fully equipped training centre and the company will supply a learning resource centre as part of this devel- opment. It believes that training is crucial to the success of the venture. It is also keen to attract high- calibre staff, particularly at management levels. It expects to utilise some expatriate staff, but is keen to

employ a high percentage of indigenous Chinese staff. It is also keen to avoid the problems that it experi- enced in its factory in the South of China.

Questions Yummee has asked for guidance on the following issues:

1 How should it go about recruiting workers for the new factory? What recruitment channels would you recommend and why?

2 How would it organise the selection process for managers and shopfloor workers?

3 Provide guidance that focuses upon how it would develop a reward system for managers and shopfloor workers.

4 Produce a plan that focuses on meeting training and development needs. This should include the following details: timescale, resourcing require- ments and staffing needs.

5 Are there any training programmes that would be compulsory for all?

6 What systems should be put in place to ensure that individual training needs are met?

7 Identify the critical success factors and barriers that would be related to each of these activities.

Management problems � Many managers seemed unwilling to take respon-

sibility. � Managers would often prefer to hire members of

their family rather than the best person for the job. � Managers were often unwilling to discipline

subordinates. � Interdepartmental communication was poor. � Managers seemed to spend a lot of time dealing

with the personal problems of subordinates.

Questions 1 Does a knowledge of the historical and cultural

development of China help you to understand the problems experienced in the PRC subsidiary? Give examples.

2 You have been asked to take over the running of the PRC subsidiary. What managerial initiatives would you implement to help resolve the above problems? What barriers would you face and how would you deal with them?

3 To what extent could a Western model of HRM be applied to the context of this factory? If not, why not? Give specific examples.

Case study continued