A Critical Assessment of the Predominant HR Cultural and Institutional Features in Germany and the UK - Term Paper Example

 A critical assessment of the predominant HR cultural and institutional features in Germany and the UK Introduction There are marked similarities and disparities between the imbedded cultural characteristics of the United Kingdom and Germany, with these comparative diversities manifesting themselves in unique human resources policies and practices in both countries. When considering culture and its relationship to HR best practice in both of the aforementioned countries, it would be prudent to examine the role of institutions and how structure and internal practice in these institutions is founded on transgenerational factors. By transgenerational, it is meant that cultural characteristics are cumulative, having been passed down from generation to generation and have become shared values and beliefs (Hollinshead 2009). These collective cultural dimensions are what drive either corporatist philosophy or neo-liberal policies. The UK institution is founded on neo-liberal principles which involve more consensus and shared decision-making whilst German institutions follow a more stringent corporatist philosophy. The extent and composition of HR strategies in both countries are strongly influenced by these evolutions that have occurred historically due to changes in society, business and government. This essay seeks to examine the most critical cultural characteristics within Germany and the UK that influence development of HR policy. The objective is to provide a critical comparison of both cultures as it relates to institutional philosophy, taking into consideration a variety of mitigating institutional features that predict positive HR performance or conflict using a respected cultural model (such as Hofstede’s Cultural Dimensions framework) as a guidance source for HR development. The essay focuses primarily on individualism versus collectivism and the influence of tolerance for power distance in both countries from an institutional perspective to determine their disparate or congruent human resources policies and practices. Comparing German and UK imbedded cultures Culture in the United Kingdom is dominantly individualistic. Individualism is considered a type of cultural characteristic in which the predominant values are ensuring well-being and utility for the self or direct kin in a traditional nuclear family context (Hofstede, Hofstede and Minkov 2010; Hollinshead 2009; Hofstede 2001; Hofstede 1984). Individualists seek opportunities for unique self-expression and, oftentimes, these needs and beliefs manifest themselves in how the individual views their identity within the organisation with many inherent demands for recognition for individual accomplishment. This is a stark difference from collectivist cultures, or those that value group consensus, group membership, and where individual identities are founded and justified by group norms and sentiments (Cheung et al. 2008; Hofstede 2001). Collectivists are strongly influenced by group attitude and seek opportunities to secure the loyalties of group members. The German culture is also founded on individualist values, though not to the extent of imbedded cultural values in the United Kingdom (Hofstede Centre 2013). Loyalty in Germany is founded on individual preferences with a primary focus on the immediate family structure rather than the collective whole of society. Duty and responsibility as influencers of loyalty are generally imbedded, in German culture, in the contract between employee and organisation. As both nations score highly on Hofstede’s Cultural Dimensions framework, there would theoretically be a similar approach to best practice of HR in both countries since the imbedded cultural values are strikingly comparable. Consider for a moment the performance appraisal process as a relevant example of HR practice. It is common in the UK for human resources managers to develop a coaching and mentoring practice in order to develop individual competencies and strengths that can be applied to a unique job role of which outcomes serve as the framework by which to measure job performance. There must be recognition of individual accomplishment to ensure minimisation of change resistance and also to establish a sense of organisational belonging which is a necessity to enhance motivation to achieve productive work outcomes. The UK is considered an achievement culture, where individual feedback is welcomed and where status within the organisation is strongly based on tangible, personal accomplishments (Javidan 2004). Thus, theoretically, it would not be an effective HR strategy to develop group-oriented rewards since this does not provide opportunities to provide workers with opportunities for individual recognition and accolades that are demanded of this individualistic culture. Theory indicating similarities of cultural sentiment about individual values in Germany would also seem to point toward a necessity to establish individual feedback systems to provide like utility (self-satisfaction) comparable to counterparts in the United Kingdom. However, the historical evolution of the corporatist system in Germany seems to confound traditional rationale that individualistic-oriented HR policies work in this culture, even though its shares many similarities to the United Kingdom. Works councils, holistic vocational training, and labour unions are a significant part of the institutional model in Germany (Wever 1995; Wever 1994) are dominant features of the workplace for German workers, which involves homogenous, collective representation. Productivity in Germany is therefore maximised through what is referred to as collective voice and less associated with individual, autonomous work function (Brewster et al. 2006). As such, when comparing cultural differences and similarities between the United Kingdom and Germany, from an institutional context, it is realised that corporatist evolutions in Germany serve as substantial influencers of human resources and human relations policies that differ from the United Kingdom. In the highly individualistic UK culture, unions and work councils are often looked at with disdain and distaste, which is more properly aligned with Hofstede’s theory of individualism versus collectivism. German workers see the convergence of representations from works councils and labour unions to be valuable social partners in the institution, suggesting a cooperative mentality. There is, therefore, a type of discrepancy between alleged cultural characteristics that lean toward strong individualism preferences in German culture that are less relevant in the institution as compared to the multinational, traditional corporation. Why does this disparity between theory and tangible institutional processes matter when comparing German versus United Kingdom HR best practice? Duty and responsibility are paramount values for the German worker (Hofstede Centre 2013) which is manifest through various contracts between employee and the organisational leadership. In the UK, duty and responsibility are aligned with individualistic values for maximising self-utility which would theoretically require human resources managers to consistently focus on individual worker development and growth. In Germany, the fundamental concept of duty is negotiation collectively in works councils or labour unions, thus adding a new dimension to the HR practice in the German institution. There would seem to be much less emphasis on establishing individualistic policies and practices in the corporatist organisation, with more demands on diffusing grievances and promoting more efficient training and development in holistic and homogenous training programs. Even though cultural characteristics in Germany are present as it relates to development and skills improvements at the individual level, there is significant reliance on collectivist systems in the institution that would seem to be incompatible with the type of HR policies that are highly effective in the UK. This is an interesting assumption, based on research findings, as both cultures are predominantly individualistic under Hofstede’s framework. Now, there are similarities that would enhance creating HR policies and practices in both the UK and Germany that are properly aligned with Hofstede’s Cultural Dimensions framework. Both cultures score identically as it pertains to power distance, which is the level by which a culture will accept disparity of authority between individuals of different status or rank within the institution or corporate organisation (Kelley 2009; Hofstede and Hofstede 2005). Neither culture, under this theory, is tolerant of power segregation and demands more shared decision-making and consensus throughout the organisational model. United Kingdom human resources policies are founded on neo-liberalism values, in which the organisational philosophy is a cohesive and unified culture working together collectively and where relationship development between organisation and the employee is paramount. This is strongly aligned, again, with Hofstede’s framework illustrating a need for reducing layers of distance between management and subordinates forced to follow managerial governance expectations. Thus, theoretically, it would be practical and efficient to establish policies and practices associated with the HR function in the UK that promote harmony in decision-making. These policies could include open door communications policies, laissez-faire HRM with less controls, and leadership through development of psycho-social motivational strategies. According to Armstrong (2007) these are fundamental aspects of soft HR policy development and practice applicable to cultures like the United Kingdom. Furthermore, the same can be said for German workers when looking at power distance characteristics and the tolerance level (which is minimal) for authority boundaries between managers and lower-level employees. Clearly, evolution that praises the representative features of works councils in the German institution ensures less risk to employees as they have a crucial advocate for ensuring rights, fair and equitable managerial policy, and a host of other protectionisms. The HR function, then, must establish (whether driven through ethical values or legal compliance demands) opportunities for more cohesive and shared decision-making practices to break down potential barriers that are caused by power disparities. German workers, based on the evidence, would not tolerate HR policies that lean in favour of managerial actors in the institution without considerable resistance. Therefore, theoretically (as aligned with United Kingdom values) HR practices should include opportunities for providing employees with a voice or working toward decentralised policies and practices where shared decision-making is incorporated into the HR model. Why, really, does all of this matter when attempting to critically analyse the disparities and similarities of UK and German culture from an institutional perspective? Trust in the HR function is a fundamental characteristic that will determine effectiveness of human resources strategies and practices. Farrell and Knight (2003, p.67) argue strongly that trust is “embodied in the rules and regulations within the institutional model by which employees and managers seek to gain acceptance”. The key phrase in this statement is acceptance, indicating that there are psychological or sociological characteristics, even in the institutional model, which will influence the relationship between HR practitioners and the employee population. Hofstede’s model of measuring cultural characteristics would seem to conflict this view, instead suggesting that trust would be developed if HR practices and philosophies were aligned with imbedded cultural values and beliefs. When examining the institutional model, which varies significantly from traditional multi-national or other corporate structures, trust has been identified as stemming from the human relations that converges with human resources that has become a necessity for improving productivity and efficiency in the institution within the German organisation. In the UK, trust associated with this convergence would be irrelevant to establishing HR policies designed to foster this trust since there is a recognised distaste for the presence of work councils and labour unions. It would then, based on inductive analysis of all research findings, be much easier for HR managers to align their HR strategies in the UK with known cultural characteristics as opposed to the German environment as there are more mitigating circumstances related to institutional practices (that have evolved over time) that will determine the approaches taken to human resources in Germany. It should be recognised that there are many evolutions not directly related to inherent cultural characteristics in Germany that serve as predictors of success in developing appropriate and acceptable HR policies that are not present in the United Kingdom. Having provided a critique of the congruencies and disparities of UK versus German culture within the institution, it would be supportive of all aforementioned findings to provide a personal reflection of genuine experience working with cross-cultural groups. Knowledge gleaned through these experiences provide a primary research dimension to understanding how cultural disparities or similarities impact HR strategies by applying experiential learning to supplement knowledge provided by theoretical models such as that offered by Geert Hofstede. Primary research findings are critical to justifying or refuting theory to provide more sustenance to social and business practitioner understanding of culture and its relationship to human resources policy and practice development. Personal reflection – Working in diverse cultural groups Experience was gleaned by working in a group that consisted of an individual hailing from Nigeria, another from China, and a third from Kenya. Individuals from Nigeria, according to Hofstede’s Cultural Dimensions framework, have a high tolerance for power distance (Hofstede Centre 2013). When working with this individual, I found many congruencies in behaviour as aligned with theory. This group member often deferred personal opinion to others when discussing important concepts, assuming a more passive role in authority within the group dynamic. The Nigerian group member seemed to appreciate when others took an autocratic leadership role, willing to comply with directives that actually seemed to enhance group function and task allocation processes. Additionally, the Nigerian group member was also very accepting of ideas that were generated by the group, showing emotionally-charged concern for the well-being of others and how group discussions and tasks were impacting other group members. This, too, is aligned with theory about Nigerian culture that suggests they are highly collectivist. During the course of discussion, the Nigerian group member was extremely loyal to others which was manifest through attitudes and emotions that were accommodating when this individual was treated with respect. The Chinese group member illustrated much trust in their own decision-making and put much emphasis on trying to reinforce and assert their opinion on others. This represented a stark contrast from theory that illustrates Chinese culture as one that is highly collectivist, sharing many of the same theoretical values and beliefs as Nigerian culture. Further research into Chinese culture illustrated one that is highly hedonistic, meaning that a primary goal is satisfaction of one’s own personal utility as a primary motivation (Mees and Schmitt 2008; Lemos 2004; Chinese Culture Connection 1987). Though this group member was very helpful in facilitating discussion and general contribution to task completion, I found a discrepancy between Hofstede’s model and actual individual behaviours and attitudes. The Chinese group participant often attempted to dominate discussion by imposing their own sentiment when it conflicted (which was recurring) with the opinion and beliefs of others. Putting all of these experiences together, I learned one significant, fundamental lesson about over-reliance on cultural models when attempting to determine how to develop HR strategies or generic leadership strategies. Hofstede’s framework has been criticised by many for being outmoded and not taking into consideration evolution of internationalisation in the creation of subcultures that do not always share homogenous cultural values and beliefs. Based on experience, it would seem to be practical to consider that there are evolutions occurring that change long-standing, transgenerational values and personality characteristics that do not fit with known models of cultures. As a student of HR, I have learned that there will be some congruencies that can be relied upon and also opportunities to consider differing viewpoints when attempting to develop workable strategies that will be practical in the real-world corporate or institutional environment. I believe, based on experience, that there should be some dimension of primary research in the actual organisation that considers multiple angles of cultural measurement before enacting HR policies and practices. References Armstrong, M. (2007). Armstrong’s Handbook of Strategic Human Resource Management, 5th ed. London: Kogan Page. Brewster, C., Wood, G., Croucher, R. and Brookes, M. (2006). Are works councils and JCCs a threat to trade unions, Economic and Industrial Democracy, 28(1), pp.49-77. Cheung, F., Cheung, S.F., Zhang, J., Leung, K., Leong, F. and Yeh, K. (2008). Relevance for openness as a personality dimension in Chinese culture, Journal of Cross-Cultural Psychology, 39(1), pp.81-108. Chinese Culture Connection. (1987). Chinese values and the search for culture-free dimensions of culture, Journal of Cross-Cultural Psychology, 18(2), pp.143-164. Farrell, H. and Knight, J. (2003). 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