Comparison of HR system in UK, China and Japan - Research Paper Example

Introduction Human resource management practices adopted by organizations of different regions across the globe have certain differences in terms of their approaches. It is so because organizations develop their HR system on the basis of several factors related to the social and cultural aspects of their nation. These factors are related to the culture and the business system possessed by the nation. Since human resource management deals with management of human beings who are more influenced by the social and cultural aspects of their nation they require different approaches for their management within an organization. Apart from the social and cultural aspects the economic condition and business system possessed by the nation also influence the management of human resource within an organization. The functional areas within the human resource management have a wide range such as recruitment, selection, training, development, appraisal, and many other activities for the maintenance of the human resource. Each of these functions has certain influence from the HR approaches adopted by the nation. It has not developed in a short span of time instead it is a continuous process which initiated with the emergence of organizational culture and business systems with the economic development of the nations. The HR system possessed by the nations such as United Kingdom, China, and Japan has several differences in terms of approaches adopted by the nations. Since these nations are different in terms of their economic conditions, social and cultural believes, demographic features, and business practices, they require different forms of HR practices to manage the people who have entirely different views towards their organization and business operations. However organizations in different countries are currently crossing their geographical territory and expanding their business at multiple locations. The process of globalization has enabled organizations to reinforce their international business which requires a universal approach towards the human resource management. Organizations are trying to develop their human resource approaches compatible to their every business locations. For this it is very important for the organizations to understand the differences between the HR approaches of different regions and develop frameworks which are globally compatible and effective. HR system and its importance in the organisation An organisation comprises of different systems that assist it to achieve the organisational goal or corporate goal. These different functions are finance, marketing, human resource, purchase, production, administration and so one. Each of these systems has their distinct role to play and is equally important for smooth functioning of the organisation. For an organisation its human resource is the most vital resource, hence it’s the responsibility of the HR department to enhance their productivity through appropriate HR policies and practices. The human resource function can be well defined as “the function which is primarily responsible for the well being of an organisation’s employees” (de Beer, 1998, p.168). The HR department conducts a wide range of activities such as recruitment & selection, training & development, performance appraisal, compensation management, grievances handling and all other functions that are required to motivate and enhance the productivity of human resource (Bohlander & Snell, 2009, p.151). Figure 1: Tasks & Subtasks of Human Resource Function (Source: de Beer, 1998, 169) The given chart provides an in-depth analysis of the different tasks and subtasks performed by the HR department. As compared to all other resources, human resource is the most complicated and difficult to manage; hence HR department needs to develop different policies and practices that assist in recruiting the right kind of human force and retaining them in the organisation. It can be concluded that the HR practices followed by an organisation directly influence the organisational culture and work environment. With passage of time the role of HR department is changing and gaining more importance in strategic decision making. The concept of human resource management is now replaced by strategic human resource management wherein the HR department works hand in hand with all other departments to set future strategy for the organisation. To have an in-depth understanding of how an efficient HRM assist the organisation to achieve its long term profitability and growth, below given diagram needs to be taken into consideration. Figure 2: The Chain of Relationships Linking Management Practices (Source: Bernardin, n.d., p.16) Culture and social structure influencing HR practices HR practices followed in a country or region reflect to a great extent the culture and social structure of that specific region. HR practices are dynamic in nature, they had evolved long back in the history and as per the changing market condition they modified themselves accordingly. The process of change is always constant so as to accommodate the changing lifestyle and business activities. Culture of a region projects the common belief followed by the people; hence it directly influences management activities, decision making process and communication among employees and management (K’Obonyo, 2007). In the same way the social structure of a country influences the HR policies in many ways. Influence of Culture & Social structures on UK’s HR practices UK is a developed nation which is highly influenced by contemporary culture, the influence of popular culture and advanced social structure is clearly visible in HR practices prevailing in UK. Organisations in UK are managed by efficient professionals; hence each and every department has a well defined set of protocols stating their responsibilities. HR policies are developed by HR department before presenting it to the boards of directors. Once the board members accept the policy it’s the responsibility of the HR department to implement it (CIPD, 2009). All activities related to the HR management are conducted in a highly structured manner. The processes such as recruitment, selection, performance appraisal all are carried out in accordance with the prescribed method that enhances transparency in organisational culture. Influence of Culture & Social structure on China’s HR practices Influence of traditional culture and social structure of China is distinctly visible in their organisational culture. For the Chinese, business is an extension of their family hence the employees maintains a father-son like relation with their employer. In a family owned business the members of strategic level management are also the members of the same family, hence all the vital decisions regarding human resource management are taken by the head of the business. The business head follows autocratic leadership style hence the HR practices are very unstructured (Warner, 2003, p.28-29) Influence of Cultural & Social structure on Japan’s HR practices Japanese are proud of their traditional culture and try hard to preserve it. Influence of the tradition culture and social structure are also present in their organisational culture. ‘Symbolism’ had a strong presence in the Japanese culture, till date symbolism is distinctly visible in the HR practices followed by its organisations. The Japanese employees maintain a family like bondage with their employers; thus the management and employees work together for betterment of the business. The Japanese believe in achieving excellence in all aspect of life, so they often set benchmarks to measure their level of excellence (Ijose, n.d.). The employees make small group called quality circle and work hand in hand with the management for identifying and overcoming operational problems in the organisation (Suharnomo, 2009). Hence, for the employees their work place is as dear as their family and they retain a lifelong relation with it. Economic condition influencing HR practices The economic changes taking place within a nation has significant influence over the HR practices adopted by the organizations. Economic development encourages changes within the business system of the organization where human resource is the first to observe the change. These changes also influences the HR approaches since better economy helps organizations to perform their international expansion where every HR initiative has to be considered on global perspective (Noe, 2004, p.452). Economic influence over HR system of UK United Kingdom is a developed country with a strong economic background but the organizations present in UK also faces numerous challenges in terms of their HR practices. The macroeconomic policies has helped the nation significantly in identifying and controlling the core issues related to the human resource management. A major challenge faced by the nation is the rate of unemployment which is needed to be controlled through effective policies developed for the labour market. Effective labour policies help them in channelling the jobs through which opportunities are provided to the unemployed. The public employment service institutions play a crucial role in delivering the opportunities to the unemployed. To prevent the issue of long-term unemployment the welfare-to-work approach is very much effective in controlling the early retirement of employees. The reformation of pension system has also been removed from the arrangements of public pension since it reduces the participation level of older employees (Vaitilingam, 2006, p.5). Economic influence over HR system of China In China sustainable development is a major concern since it is still a developing economy but has a significant rate of economic growth and development. Unlike UK’s economy China had a closed economy for a significant period which proved to be major obstacle for them in their economic development in global perspective. Realizing the importance of open economy and international trade activities for economic development China adopted principles of open economy with increased level of cooperation and mutual benefits (Jintao, 2009). The changed structure of Chinese economy has greatly influenced their HRM practices. The government of China has taken effective initiatives to achieve the momentum of global economic development like forming Chinese Economic Development Zones. The Chinese organizations were assumed to be losing the labour-cost advantage which has influenced their achievement of long-term competitive advantage. Shortage of effective and skilled practitioners of HR and labour relations has proved to be a potential cause for the inability of attaining sustainable development by Chinese organizations. Considering the reason China has agreed for implementation of "Improved Human Resources Development and Management and Labour Management Relations in Chinese Economic Development Zones" with the support of the International Labour Organization (ILO) (Anonymous, 2004). Economic influence over HR system of Japan Japan faced several damages in terms of its economic and business conditions during 1990’s which has impacted the HR practices of the organizations. Companies in Japan became more conscious with their hiring process, performance assessments and grading, and promotions. Japanese organizations have tried to develop better control mechanisms for appraisal methods and reducing the bureaucracy within the organizations. For improving the productivity of their workforce organizations have also put effort on the concept of pay for performance. Considering the emergency situation of meeting the requirements for global competence Japan has initiated a project on "Human Resource Management towards the 21st Century: International Comparison" during 1992 with the support of Japanese Productivity Center for Socio-Economic Development (Takeuchi, n.d.). Business System influencing HR policies The HR practices followed by a company are mainly influenced by the business system prevailing in that that region. So depending on the business system, the size of the organisation and attitude of top management different human resource practices art developed. Influence of business system in HR practices followed in UK In UK the business organisations prefer to have a more flat and matrix like organisational structure. Role of each and every employee is well defined and responsibilities are properly delegated to them. So the organisations functions quite effectively with high degree of transparency. Hence the HR department develops specific policies for specific department after understanding their need. As motivational factors differ for different employees hence the HR policies are quite flexible to suit individual need (Business News, 2008). Influence of business system in HR practices followed in China In chine two major type of business organisations are present; either the business is a public organisation where the government controls all activates and another is family owned organisation where all the decisions are taken by the owner of the business. The size of business run organisation is mall to moderate, so HR policies are not well structured. In the publicly controlled organisation HR policies are more bureaucratic in nature. Hence the degree of transparency is low. Influence of business system in HR practices followed in Japan In Japan long organisational structure in present in almost all the businesses which are of big size. The concept of forming conglomerate to gain economies of scale is common in Japan, even the employees are considered as strategic partner of the company. To retain such big bureaucratic organisation in profit making state contribution of employees is highly essential. So the management retain a family like relation with the employees through efficient and structured HR practices. Comparison of recruitment policies The recruitment policies of UK are very much different from that of China and Japan where traditional and cultural values are given more preference. In UK the recruitment policies are fair and transparent which also encourages non-discrimination of applicants on issues like race, gender, disabilities, age, and religion of the applicant. Defining the job description is considered as an important aspect in UK’s recruitment policies and the applicants capabilities are strictly matched with the required skills (Anonymous-b, n.d.). The details of the role are specified clearly which is them compared with that of the applicants capabilities. The title of the job is always considered to be neutral in the context of sex and age and specifies the purpose to be fulfilled by the job (UCL, n.d.). In China the recruitment policies are heavily influenced by bureaucratic activities in allocation of workforce. This is a significant reason which makes the HR practices of China different from that of UK. The young workforce of China depends upon their government for assistance in forms of employment programs and they are required to wait for that instead of searching jobs on their own capabilities. This kind of employment assistance is found only in China making it different from other nations. To renovate their traditional approach towards employment the Chinese government performed these employment programs at state level and developed policies to reinforce the programs. Organizations are required to take approval from the state labour agencies for performing their recruitment activities (Bian, 1994). The recruitment policies adopted in Japan are reluctant to hire candidates from external sources instead they rely more on recruiting fresher who completes their schooling. It is very much rare in Japan that organizations hire employees from another organization. Under the recruitment policies of Japan candidates are initially sorted on the basis of their educational achievements and knowledge base. Candidates are further shortlisted on the basis of assessment of their technical and professional capabilities required for the job. It is also found to be present in recruitment policies of UK especially in case of recruitment for female labours. The recruitment activities for higher positions are performed with the help of press and also with a support of companies involved in search of executives. In UK the office hours are considered on the basis of arrival and departure of employees to and from the workplace while in Japan the working hours are strictly considered on the basis hours spent on working bench, i.e. the actual place where employees perform their jobs (Dunning, 1986). On comparing the recruitment policies of the three nations UK has been found to be more resembling with that of Japan whereas China has its own unique approach towards their recruitment activities. The UK has resemblance with that of Japan in terms of their recruitment policies which is evident from the fact that UK has implemented several policies for female labour recruitment similar to that of Japan. Comparison of appraisal process In UK the appraisal process and development are not considered to be mutually exclusive but out of the two factors, i.e. appraisal and development which has to be more emphasized has remained a major issue for them. It is determined on the basis of decisions regarding the way the appraisal processes are carried out. In many organizations these processes are considered to be mandatory for all levels while some of the organizations have made this optional for the middle level management and mandatory for the top level. Performing 360 degree feedback is considered to be a potential input to the appraisal process (Fletcher & CIPD, 2004). The appraisal process in China has seen a transition phase which has shifted from a highly centralized structure to a merit-oriented appraisal process. China has encouraged the appraisal process through merit-oriented approach because like other HR functions appraisal process has remained as an important o\part of western HR practices. Since China has taken several initiatives to meet the global requirements it has also encouraged adoption of western management system practices. Earlier Chinese organizations followed their ideologies which emphasized only the administrative activities for appraisal process but after the transition the appraisal process focused on development and communication also along with the administrative functions (Zhu, 2005). In Japan the appraisal process involved the understanding of the similarities and the differences present in the emotions. The appraisal process tries to identify the similarities and differences in the culture. The appraisal process adopted in Japan has several similarities as well as differences from that of the United States and many European nations. The appraisal process is carried out in primary and secondary steps where the data obtained in the secondary step helps Japanese organizations in understanding the emotional lives of the people in Japan. Emotional factors are given more importance in the appraisal process adopted by Japanese organizations (Matsumoto, 1996). Comparison of training and development practices If the company want to achieve success in their business, they should posses a compatible work force that is motivated enough to work with the management for achieving corporate goal. It is the responsibility of the HR department to recruit best suited workforce in the company, but it is equality important o train them and make them more productive. Different companies use different training and development process for their workforce to enhance their knowledge and skill. In developed country like UK companies maintain good amount of budget for training and development programmes for employees working at different positions. As soon the employees are recruited in the company they receive an introductory training whole duration varies from few days till few months. This training explains the job responsibility to the new recruited employee. Again at proper interval of time the employees need to participate in different training programmes that help them to improve their job knowledge. Training is given on-job as well as out-jobs depending on the job responsibility of the employees. In UK training practices are continuous in nature and are compulsory for all the employees irrespective of their position (CIPD-a, 2010). Chinese management approaches has always considered training and development practices as the essence of producing quality goods. Organizations invest a part of their revenue into the training and development activities. The management of the organization develops training programs after identifying the needs of the production. Both the technical and non-technical training programs are conducted separately by the management of the organization which are handled by the respective authorities (Zhu, 2005). In Japan the training and development activities are much better than that of UK especially in case of technical training offered to engineers. Training and development activities performed by the organizations in UK have many deficiencies because of their poor performance of manufacturing activities. So organization in UK faces difficulties in providing effective training sessions to their employees which also lack involvement of new technologies. It is entirely different in case of Japan where the training activities are taken up as a crucial part of employee development and employees are provided with appropriate training sessions on both technical and non-technical parts. Introducing the employees to the new technologies has also remained a major feature of Japanese training and development practices due to which they are ahead of UK’s training and development practices (Howarth, 1990). Evidence of convergence and divergence Initially the HR practices adopted by the nations were very much different from each other which could be clearly understood from the differences in their approaches. The UK HR system has many features which are similar to that of Western management system and are very much pronounced in European nations while the HR practices adopted by China and Japan have similarities with the Asian management style. However, with the increased level of globalization, organizations are crossing their geographical boundaries and emphasizing the international business activities. Hence it becomes imperative for the organizations to develop HR practices thorough cooperative learning and mutual understanding. Organizations which have plans to expand their business activities in international market should adopt a comprehensive HR approach. This comprehensive approach for managing human resource can be developed by shared the various HR practices adopted by different nations. Through effective learning and sharing of knowledge, organizations will be able to reduce the deficiencies present in their HR approaches. The HR system of UK has already adopted several approaches which are common to that of the Japanese HR system. Special attention given to the hiring of female labour by UK organizations is a potential example which they have learnt from Japanese HR management approaches. Betterment of training and development activities in UK organizations are also influenced by the Japanese HR systems. Considering the divergence of HR practises, China has an entirely different approach towards the issue of employment which bears no resemblance with UK and Japanese management systems. 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