International and Comparative Human Resource Management in Japan - Example

Human Resource Management Name Institution Tutor Date Introduction The idea of human resource management was conceived and created not very long ago; it was in the period between the 1960s and 1970s in the US. However, the development of this idea was facilitated by the increasing competition of industrial production mainly in East Asia, which included Japan. Many branches of economics are geared towards clarification and identification of the factors that contribute or affect economic performances in amongst different countries, organizations , firms etc. this is common and mostly focused on production function conventional analysis. Human resource is a good contributor in functional production within a particular entity and its management is very crucial. By applying this kind of management organization, create within themselves advantages for competition. The completion is extended to international and global levels. Actually, a few of the management aspects had reference from the Japan practices that were very influential in Japan and Asia generally. The elements which included compactness and togetherness that is loyalty, sharing of information, teamwork etc. were involved in the new management system. This management system was expected to increase competition among organizations as well as the provision of a better welfare for individuals (Brewster, 1995, 1-22). Therefore, this report is narrowed towards discussing the main factors revolving around effective human resource management (HRM) in Japan and Australia. The Human Resource Practices in Japan In Japan, three pillars were used as foundation for their traditional HRM model. The main pillars include the following: The labor unions Long-term job employment and Promotions & a payment system based on seniority After the world war, management pattern in Japan was viewed as paternal and organizations viewed as ‘families’ that have harmony, group orientation and hierarchy, and at the same time incorporate Taylorism. These type of managements have an important cultural reference of Confucianism that stresses a system of properly defined networks that are obligated mutually: the emphasis are on the recognition of the social and economic needs of employees and their families while employees on the other hand are required to be committed and readily accept change. However, its economic state, high global competition and demographic pressures now facilitate the HRM reforms in Japan. The major reforms include (Benson and Debroux, 2004, 55-75): Introduction of flexible employment systems that tend to adjust labor costs by creating 3 groups of employees i.e. full-time employment, contractors and part-time employees. A continuous shift to economically based rational merit appraisal system for wages and promotions. These reforms were accompanied by very significant levels of human costs. Generally, human resource development is very vital because it develops skills and matches employment with industrial needs. In Japan, HRM is going through transformation and the process is experimentation. The new system is characterized by flexible recruitment, payment systems, working conditions, a system where individual performance determines promotion and remuneration and also improved employment on contract with consequent permanent employment. The individualism portrayed by the reforms have other effects as employees tend to increase personal performance instead of collective performance which is the most effective and sometime considered in evitable. This shows that management practices should be very clear to avoid clashing with the organizational and national cultures resulting to counter-productivity. There are a number of factors that affect HRM changes in Japan according to Benson and Debroux, (2004, 55-75), and these include the following: Increased mismatch of business and traditional HRM Young people in Japan tend to develop change in their attitude towards work and organizations The shift to merit based systems leaving the seniority and skill based systems. The union was unable to protect employees resulting to retrenchments and downsizing. This factor has made the Japanese to lose faith in their traditional HRM systems. However, some of this factors cause resistance to change and surely lower the rate of HRM changes. For instance, the reforms’ nature of experimentation led to uncertainty in a few companies and subsequently denial of the changes; the legal framework also contributes to resistance as there are laws protecting employees from dismissal and therefore making the important changes much unexpected even in the near future. This is evident in Japan and hence shows that Japan is undergoing a transitional and experimental stage and it actually appears to be developing a hybrid system. Japan also tried adopting performance oriented HRM systems, which never led to the expected objectives. This type of system was not recommended for the Japanese even on their traditional organizational ways and principles. It caused fear and stresses among the workers as it downgraded the two strengths of the prior system: institutional compactness of the people and the creation and transfer of skills in the organizations. This led to suggestions that employers in Japan had to eventually change their HRM systems to job oriented from the previous people oriented one, with the intention of showing workers the clear criterion of measuring contribution and rewards respectively. In addition, non-monetary reward systems such as platforms for workers to choose their preferred jobs were to be incorporated for appropriate achievement and work completion (Kishita, 2006, 29-48). Employers in Japan also considered securing the dedication and loyalty of workers during instances of job insecurity by giving guarantees. The guarantees were on long-term employment basing particularly on the organization’s performance in the general marketplace. The previous Japanese HRM practices of creating a stable peoples’ culture and workers’ motivation, were also emphasized for the employers. Investing in Japan had certain characteristics; (this is in comparison to the US and the UK respectively) The ratio of investments in innovative property to GDP is high because of the high R & D investment levels in the country. Average levels of investment in the computer information sector with regard to the GDP. Considering the economic competencies investment, the ratio between investment and GDP is low. The competencies investments include investment in; organization-specific human capital, firm related reforms and in brand equity. In Japan, there is low investment in organizational-specific human capital. However, the comparison of these investment quantities with other developed countries is not easy. In addition, these investments are dependent on the management practices involved at the organization level. Therefore, recent research on Japan related investments have focused on human resource management practices and firm based reforms using micro data. Japanese organizations adopted the HRM practices from the American ones. This was inevitable due to the fact of both liberalization and globalization, showing the desire of change between the Japanese. Japanese managers considered adopting the American attributes of performance, result and objectives way of orientation and leaving their seniority based orientation and principles. Other attributes that were adopted by the Japanese at large include (Markus and Anne, 2009, 12-13); Autonomy Merging and possession of companies Efficiency based relations Remuneration on positions Profit based and shareholder value Consideration of market outcomes Restructuring Decentralization of organizational structures Leadership External employee recruitment. Globalization All these attributes of human resource managements are important not only to the Japan based organizations but also to other foreign companies that are interested in investing in Japan. This is because the Japanese companies themselves are abandoning their traditional ways of HRM and the foreign companies should follow this. A case study of the workplace training in Japan (Picture table 1 Fukao et al, 2009) A unique survey was conducted on some Japan manufacturing companies and conclusive statements on the effect of organization level training and innovations HRM policies made. Findings show significant effect off the job trainings on the organization productivity but not necessarily for the on job trainings. The regression showed similar results when the valued added was replaced by wages. The effect of the off the job trainings (OffJT) is significant compared to the on job trainings (OJT). Furthermore, the effect of OffJT on production is higher than the effect on wages, showing the presence of the benefits organizations acquire by training their workers/employees. The HRM practices also affect the trainings and productivity. It usually takes a longer time for these practices to give improved productivity. Due to these strong effects on training intensity, it is appropriate, however, that the HRM practices may lower training expenditures, the benefits involved are not dependent on the management practices. 2. The Human Resource Practices in Australia Australian response rates differ amongst employees, the response idea is used as an online tool to do diagnostics. Many organizations carry out internal diagnostics, which makes employees suffer from fatigue. Many differ on the idea of change in the organization but those who adapt to the change can easily carry out their work as usual. To carry out such study the major key leaders are the most used in such studies. High performing workplace index is used to determine the characteristics of working places; the index distinguishes high performing workplaces from low performing workplaces. Institutional talent management improves the quality of an organization human capital. On analysis of human capital gives the rising employees a chance to express themselves in the current organization. Employee assurance is emphasized and the employees will be encouraged to commit themselves to the organization. Management practices measured against the high performing index gives the managers what tactics to employ in order to reap maximum. The values, which give more participation to employees, encouraged them to participate fully in the organization. The performance of the employees can be monitored by using the performance index. The index is used to retain high quality human capital. Human capital is one of the most vial intangible assets and maintaining it can help in a great deal to achieve the set objectives. The evaluation program is one the culture used to align the employees to be in harmony with the company’s goals. (Accenture, 2001, 1-5.) Organization cultures are the values and practices that are shared throughout the organization or work group. The values are essential as it gives the employees the feel of identity and such feelings can promote commitment to the organization. The social system stability is enhanced in an organization with reduction of the disruptive conflicts within an organization. The cultural values can also be used to control behavior and guidance. There are four major categories; personnel management practices, nature of employees, customer feedback and business type. In a case study of a comparison between the Australian and Singapore hotels, the human resource personnel management practices differ according to the customer base they serve. The owners of the hotels were foreigners and locals as well. The employee profile is determined before assigning responsibility to anyone or hiring any employee. The culture in different institution was to hire more of locals unless there was need for external assistance for instance foreign foods that had complexity in cooking by the nationals encouraged hiring of foreign employees. The institutional culture is equitable employment opportunities as the number of male and female employees are considered. Although many employers consider hiring one gender, more than the other in Australia the issue is solved by equitable employment opportunities. The Australian organizations emphasize on experience and skills in the business or work. The workforce in Australia is geared towards quality and productivity; this has encouraged highly motivated mature employees with job competencies fulfilling the organizational needs. Employees in Australia join unions that suit them as the accommodative nature of different unions differ worldwide. In hotels in Australia, according to the study in comparison with Singaporean employment technique, the Australians somewhat encouraged exploitative employment relationship which included low wages and minimal employee participation. This has been eradicated by building value added features, which include; job rotation, training and also management systems and the incorporation of multi-skills and functional flexibility. The human resource management may contain mission statement and objectives as in Australia; this gives the employees to be operational on the philosophies. Policy manuals and procedures have been provide to the employees the change is geared toward achieving a modern strategic kind of objectives. Characteristics of Management Practices in High Performing Workplaces (HPW) In Australia, there are existing high performing firms that have attained the high status by possessing various characteristics of management practices i.e. in form of systems, programs, processes etc. For instance, talent management institutionalization, which probably will result to, increased quality of the human resource. During institutionalization, the turnover rates and costs of workers are decreased. Statistics of correlation values on the various key factors involved in the high performing firms in Australia suggest that the management practices and HPW Index closely co-vary. The practices with the highest values included; participation in strategic planning, involvement in decision making, utilization of skills etc. this creates the possibility that these practices are present in the particular firms. Some of the practices are as follows (Boedker, 2011); i. Change Responsiveness in Stakeholder and Customer Networks. Organizations need to be flexible so that they can adjust to customer requirements and environmental changes. Australian firms achieve this by creating external links with key stakeholders. This enables them to be information rich for comprehensive networking. All workers engage in the activities concerning customers and the wider community. Good relationship is encouraged among the workers for effective response on the customer oriented matters that always arise. The HPWs have a system of providing organizational information to all its workers from the seniors to juniors. Goals and objectives are clearly stated for all parties to understand while there is utilization of non-financial measures of performance. The utilization makes the organization understand their customers, employees and suppliers. ii. Workers’ Participation in Decision Making Processes This participation is important to the Australian firms as it ensures dispatch of information. Service production is organized by HPWs to ensure equal distribution of responsibility among the workforce. Knowledge sharing and coordination is enhanced by the distribution of responsibilities, which is a service, which HPW benefits from. Distribution of responsibility assists in creation of commitment among workers leading to exertion of extra efforts as a sense of ownership and pride is felt. Individual potential can be realized due to sense of ownership and employees will work best at their full satisfaction. Formation of creative ways of problem solving is a key component in solving emerging issues. Employee participation in decision-making process within an institution encourages interaction among people from diverse backgrounds. The participation leads to creation of new ideas as well as innovations. Utilization of skills in HPWs is a vital component in increasing internal connectedness, teamwork and structures that will lead to rewards in the near future. Cross departmental participation is emphasized in order to increase the employee participation. The employees have used consultative forums in manufacturing industries and sub committees circles to increase participation. However, this is not used largely these days. Budgeting, planning, strategy participation and target setting are some of the practices used by HPWs in increasing employee participation. Customer closeness by the employees is important in getting views and opinions on different products; thereby sharing of knowledge is upgraded. HPWs encourage involvement of staff at all levels in developing and implementation of strategies. Managers look for information and advice from all areas including subordinates and fellow managers. When devising a strategy, launching new activities or changing existing programs efficient and knowledgeable information is required. HPWs have extensive knowledge in such creative ways to get into new market or upgrade an existing consumer demand. Inquiry on the ever-changing circumstances is required for strategic planning, as new solutions are required for emerging issues. Knowledge of subordinates and their participation develops clarity of the objectives and goals an organization has. The point means that new clientele are not an issue of that can shake the organization but will encourage negotiation and mutual understanding between the two parties. HPWs enhance exchange of ideas in and beyond the organization so that customers can be served better. Although, too much participation of employees in decision making can raise conflicts and tension at work due to existence of competing interest. The issue can be solved through constructive debate and quick problem solving. iii. Workers development on Behavioral and Skills Flexibility This is also another key characteristic of Australian organization as it relates to adoption of cultures at work. In this case, flexibility is achieved by the practices of on-the-job learning when workers experience difficult situations. Other practices include; mentoring programs and task rotation among the workers. These practices are very recent and might not be provided by the normal formal education programs. Actually, investing in training is not necessary for the HPWs but there is some association for trainings in interpersonal skills. Other HPWs factors include ICT, which is very resourceful mainly in service based HPWs. For instance, ICT gives: Support to business related activities. Lower costs of service delivery. Increase productivity and profits. These are achieved by the ability of ICT to avail information with reliability, speed and in the process bring people together within and outside the organization/firm/company. It also provides support to the organizational strategies with improved service quality and customer experience. Analysis of customers and stakeholders is also part of ICT. Challenges experienced by work places in Australia. The challenges are extensive because they affect the local and foreign organization in Australia. There are organizations that observe proper human resource management practices and strategies hence effectively manage the challenges. The challenges experienced include poor; Motivation of workers to assume greater responsibility Retention of highly resourceful workers Creation of flexible and responsive culture in the workplace Performance-pay linkage Involvement of workers in decision making Platforms for employee advancement Ways of increasing employee productivity Diversity in management Communication with employees Collaborative partnerships with labour unions Conclusion Human resource management is very crucial all over the world. Therefore, any organization, firm, company or corporation that intend to go beyond their present borders need to consider it carefully. As it has been mentioned above in Japan and Australia. In these countries, the labour fraternity at in different ways and expect different things from their respective employers. In Japan, the workforce was previously fixed to their tradition ways but later adopted foreign ways of human resource management. This might sound good to investors but they should know that human beings are unpredictable. Their major traditional ways focused on labour union superiority, supported legal framework on employee rights and protocol on dismissal cases. The young generation of Japanese is also very significant for investor as they tend be very proactive towards current trends and issues in their country, the ones that concern them and the ones that do not. In Australia, the workforce has no traditions but have many expectations from their employer due to the high set standards. The issue of gender balance is experienced in Australia together with the discouragement of union membership but employee protection is common. They also have available labour market with skilled HR managers who can create more specific and integrated human resource management system. This system will help in overcoming or solving the country’s present problem of high employee turnover and transience trends. All these factors discussed about these two countries are very important for any investors who want to join these economies. Bibliography Accenture, L 2001, The high performance workforce: separating the digital economy’s winners from losers.’ In The Battle for Retension Accenture’s study, Pp. 1-5 Benson, J and Debroux, P 2004, ‘Flexible Labour Markets and Individualized Employment: The Beginnings of a New Japanese HRM System?’ In C.Rowley and J. Benson (eds.) The Management of Human Resources in the Asia Pacific Region: Convergence Reconsidered. London: Frank Cass, pp. 55-7 Boedker, C, Cogin, J, Langford, P, Meagher, K, Mouritsen, J, Runnalls, M, Sheldon, P, Simmons,S and Vidgen, R 2011, Leadership, Culture and Management Practices of High Performing Workplaces in Australia: Literature Review and Diagnostic Instruments, funded by the Department of Education, Employment and Workplace Relations, published by the Society for Knowledge Economics, January, 2011. Brewster, C 1995, ‘Towards a European Model of Human Resource Management’, Journal of International Business, 26:1-22. Pudelko, M and Harzing, A 2009, Japanese human resource management: inspirations from abroad and current tends of change, London: Routledge. Society for Knowledge Economics 2011, Leadership, Culture and Management Practices of High Performing Workplaces in Australia: The High Performing Workplaces Index, October, 2011. Society for Knowledge Economics 2009, Leading Australia to More Innovative, Productive and Fulfilling Workplaces—The Role of Government, prepared on behalf of the Department of Education, Employment and Workplace Relations, November, 2009. Society for Knowledge Economics 2009, Workplaces of the Future, for the Department of Education, Employment and Workplace Relations, for the Workplaces of the Future Forum, Melbourne, July, 2009. Society for Knowledge Economics 2005, Intangible Drivers of Organizational Productivity and Prosperity—International Trends and Developments in Extended Performance Management, Measurement and Reporting, prepared on behalf of the Department of Finance, February, 2007. Kishita, T 2006, “The HRM of Japanese Firms in the Days to Come of Global Competition” Research and Practice in Human Resource Management, 14(1) 29-48. Read More