Managing International Human Resources: A study on Tokyo and Beijing - Research Paper Example

? Managing International Human Resources Introduction: Different countries and different cities represent different forms of organizational structures, values and principles. If two different cities in a particular region are studied from a human resources (HR) perspective, several differences would be observed. If China and Japan are taken for a detailed study, it would be observed that their cultures and practices have enabled these countries to establish their position in the world market and are now become mass producers of different products. Tokyo, the capital of Japan, portrays the growth of a “small fishing village into a major global city” (History of Tokyo, 2011). The Second World War had damaged key parts of the city; however gradually with time, the city represented economic development between 1950 and 1960. From the year 1970, the development of the city was moving at an increasing rate and presently it is one of the “most developed countries” globally (History of Tokyo, 2011). Although the global recession had affected the businesses of Tokyo as well, the economy of the city developed again reflecting new developments and relevant cultural practices. Several developments in the urban areas have also been achieved by the city in the last few years (Reiber, 2010, p.17). Management in Japan has been found to be robustly associated with the cultural practices that are followed by the country. The country’s distinct human resources practices form a strong support for the development of the country (Haghirian, 2010, p.13). The origins of Beijing, which is the capital city of the People’s Republic of China, can be traced back to around 2000 years ago; however, with the establishment of the People’s Republic of China, the city was formed as the capital of the country. Representing the history of China, Beijing today possesses the civilization of 3000 years, at the same time changing and modifying towards glowing “beauty and youth” (History, 2011). The city has been developing all over these years in respects of its cultures, values as well as business practices. The management practices of the city reflect focus on the cultural artifacts, monuments and parks, and have been developing roads, transport, and water supply; the intentions being stressed on bringing peace and unity to China. Focus on industrial development also gradually has been taken concern of by the city (Haw, 2007, p.113). This research aims to study the differences in the two locations, in here Tokyo and Beijing chosen for the study, with a perspective of the international management of human resources, focusing on the employers and labor relations and other human resources practices prevalent in the two cities. A study on Tokyo and Beijing from International Management of Human Resources Perspective: Need or Availability of Talent for Accomplishment of Future Goals: China reflects a scenario where the business managers have to incorporate changes in their organizational practices without affecting the cultural values of the country. It is a great challenge for the managers to recruit, retain and develop talent keeping respect for the influences that culture may have in the nation’s characteristics. Leaders of Chinese companies that include companies in Beijing are focused towards retaining talent that can work in teams and achieve organizational success. The labor market is highly competitive, thus creating competitions among businesses in searching for best talents. Finding and retaining the “right people” is given high importance by the organizational leaders in China (Leadership in China: Keeping Pace with a growing economy, n.d., pp. 5-6). Thus Beijing’s need and availability of talented workforce can be understood from the perspective of China’s business environment. Considering Japan and its capital Tokyo, a UN study has reflected that the population of Japan getting aged in a fast pace has formed a requirement of lakh of immigrants that is expected to keep the workforce of the country secure and steady. The country has a shortage of young dynamic workers in the information technology prospect. Although the companies have excellent training programs for workers, yet the lack of sincere higher studies has a negative impact on the availability of efficient workforce. However, with a changing and developed world, the problem of availability of labor for accomplishment of Japan’s business goals is expected to be overcome (Gordon, 2005, pp.92-93). Legal Obligations and Concerns Affecting HR and Labor Relations: Political, legal, cultural and economic factors to a great extent affect the HR practices being followed in the business organizations in China. Several labor laws including The Labor Law, The Trade Union Law, as well as Provisions Concerning the Administration of the Labor Market have a major role in the planning of human resources philosophy that governs the country’s workforce. The several legal concerns allow the country to frame a legal structure that may define the HRM policies in recruitments, trainings, wages and working hours for the employees of an organization (Schuler & Jackson, 2007, p.276). Thus Beijing being the capital of the country can be realized to have the similar influences of the legal practices on HR. Labor tribunal system (LTS) and the former regulations of the government in Japan that promotes resolutions on labor disputes are policies created for the HR and labor relations in Japanese organizations including companies prevailing in the country’s capital, Tokyo. The LTS has been found to bring developments in employee relations. The culture of the country does not promote the people’s attitudes to involve legal procedures in company matters and labor managements. Thus dispute mechanisms are focused to prevent legal actions within firms. Labor relations are administered on a regular basis by labor contracts. The Second World War affecting the companies’ labor management relationships were started to be handled through labor management consultations (Elbo, n.d.). Labor and Management Relations: The employment relations in China reflect a focus on bringing change depending on the changing economy of the market. Earlier the labor management in China involved a rigid policy of assigning work to employees as well as providing facilities to the workforce. However, competitions at the international levels have initiated several changes and the labor allocation now has shifted from state control to a combination of state agencies and companies’ recruitments. Thus candidates can themselves search for their jobs and settle their salaries. Globalization has influenced the incorporation of efficient personnel in organizations, accordingly maintaining labor relations (Wang, n.d., pp.1-2). Thus companies in Beijing as well can be expected to have efficient labor management relations as the China market represents. The labor relations in Japan include labor management discussion and teamwork, lifetime employment, seniority based wage policy, unions and high rank for HR department. In Japan and its capital city, Tokyo, unions within organizations operate both as labor unions intending higher wages and better working conditions as well as participate in promotion of management collaboration. Managers in Japan organizations experience benefits in the HR practices that assist in creation of a network with other managers. Thus HR is associated with corporate governance by the managers of the corporations. Although Japan may have “over 70,000 unions”, yet only “18.7 percent of the workforce” has been found to be actually involved in unions (Holley, Jennings & Wolters, 2008, pp.649-651). Competence of Workforce: It has been observed that the education system in China is not sufficient to prepare graduate students for working in organizations and the training and development programs also do not train employees towards enhancing their skills. Thus the competence of the workforce in Chinese companies including companies in Beijing can be understood to be less efficient in terms of their education and skills. A major cause of unemployment in China is also associated with the lack of complete education of the workers. Particularly, in the urban areas, the skills of workers are not developed, and many of them require professional training to construct them (China’s Employment Conundrum: Closing the Skills Gaps, 2002, pp.79-84). The business organizations in Japan in contrast to China represent competent workforce who have received proper and complete educational backgrounds. Even in the workplace, on-the-job training and classroom training are provided to the workforce according to the needs of the organizations. In Japanese companies, including companies in Tokyo, the training of workers is allocated with sufficient budget. Employees are competent enough to participate in decision making of the companies. 30 percent of the population in Japan is found to complete their higher education. Thus the workers are not only educated but also have sufficient skills that provide new dimension to the businesses of the country (Begin, 1997, p.260). Turnover Rates: As reports from Beijing have been obtained, turnover rates in China are showing an increasing trend that has created concerns for organizations. The rates have been found to be as high as 23 percent in certain industries making it difficult for the authorities to keep hold of staff. Companies in the telecom and information technology industries have been found to report the highest rates of turnovers (Bosses Alarmed as Turnover Rate Hits Peak of 23%, n.d.). The turnover rates in China have been observed to be highest in Asia and almost twice that of Japan. A major cause of such turnover rates have been related to unsatisfactory compensation levels (Survey: Employers in China face worst staff turnover rate in Asia, 2008). In comparison to China, the turnover rates in Japan can be found to much lower. The culture of training and development of workers may have a major role to play in this context. It has been observed that companies providing their employees with higher training measures are capable of retaining their workers more than companies who are less concerned about workers’ training programs. The successful companies in Japan have represented training programs that are not measured in relation to productivity of the company. Thus employees do not leave companies at higher rates (Enterprise Tenure, Labour Turnover and Skill Training, n.d., p.141). Medical and Health Systems: The health system in China is spread across the country. The country has a medical insurance program that covers plans for workers, for public employees and a joint medical system. With increasing private businesses and deteriorations in several business organizations, the country also initiated insurance programs for urban employees. This plan merged the “participant’s individual account and social reserve”, at the same time developing its reach to the private companies as well intending to provide enhanced and consistent “financing with its risk pool at city levels” (Gutierrez, Mizota & Rakue, 2003, p.940). The health system in Japan follows programs that cover almost the entire population of the country. Through the medical insurance programs, it is necessary that all citizens should subscribe to at least any of the insurance policies. A report on Health and Welfare had reflected that there are more than 9,000 hospitals in the country including private and public hospitals. Moreover, treatments and vaccination processes are specially taken care of, be it for the population as a whole or the employees of different organizations. The medical programs are particularly focused on all sections of people such that all can have the medical and health facilities (Gutierrez, Mizota & Rakue, 2003, p.938). Cultural Dimensions Affecting HR: Several studies have reflected that cultural factors of China have effects on the cultures of organizations, impacting management and leadership as well. This also affects the satisfaction levels of job of the employees that in turn hampers the dedication of the employees towards effective and efficient performances. Chinese cultures have been found to affect the HR in the prospects of their importance, connection with the organization, and in maintaining relationships. As Capar had suggested, the understanding of cultures is highly significant as the effectiveness of Chinese staffs have been to a large extent found to possess a relationship with “authority and power distance perception” prevailing within organizations (Pauluzzo, 2010). Thus the HR practices in Beijing can be understood to have experience similar effects from the cultures of the country. The management practices in Japan have been found to be quite competitive in nature and different from other countries like the USA or other western countries. The causes being different and competitive have been associated with the innate and distinctive cultural uniqueness. Japan has been considered amongst those countries that endow with best HR practices that others prefer to follow as role models. However, the country has been found to shift towards following the US practices that has a practical relevance for the management of the Japanese companies as well as for those organizations that operate in the Japan market including the market of Tokyo (Pudelko & Harzing, 2007, pp.4-21). Organizational Structure: Changing environments in business operations have led several Chinese companies including organizations in the capital city of Beijing to formulate complex organizational structures with intentions to accomplish the demands generated in the changed market environment. This complexity has led to decrease in the production capacity of such firms, also affecting effective internal communications and problem solving capabilities of the management. Moreover the organizational structures in China are also dependent on the cultural values of the country. Thus the complex organizational structure has proved to have negative impacts on the Chinese business organizations (Jia, 2010, p.3). Japanese organizational cultures represent group orientations. Employees are highly loyal to the companies and the companies are also concerned about the welfare of the employees. Japan and the capital of the country, Tokyo are known to have strict hierarchical organizational structures where it is believed that one should not perform over his/her duties or status. Changes are not preferred by the Japanese firms. However, high collaboration within groups is visible. Employees are also involved in decision making of the companies and proper relationships are maintained by each of the members with the other members of the firm (Organizational structure, 2004). Ethical Concerns: Studies reflect that Chinese companies including organizations in Beijing are highly concerned about the ethical issues in conducting their businesses and avoid corruption. However the country prefers not to follow any other country in their practices of ethics; rather they want to be leaders themselves to provide others with suitable ethical prospects. The Chinese companies do not endure criticism from other countries. The companies in China intend to become leaders in the business world. Their ethical practices are incorporated into their business managements and can be expected to have an influence on the entire business world (Business Ethics in China, 2010). In Japan, the ethical practices are associated with the culture and religion of the country. They believe in giving utmost respect to their business participants accentuating a lot on group activities including teamwork, group responsibility and ethical hierarchical relations. The Japanese also believe in presenting each other with gifts and presents, thus harmonizing peaceful and collaborative relationships with business associates. Organizational members respect the responsibilities and decisions of different departments of firms. The reciprocation of other business organizations towards Japan’s firm practices influences the ethical policies that Japanese companies follow (Japan Country Information, 2003). Salary Levels: The average salaries of the employees in Chinese companies including companies in Beijing have represented increases of more than 18 percent in the last few years. Larger corporations have been observed to gain sufficient profits in the last few years that could be associated with the increase in wages of employees. Beijing has also represented higher levels of salaries in the recent years, although differences are also observed amongst employees in the securities or banking industries with those from agriculture or textile industries (Average salary increase of urban workers rises to six-year high, 2008). Japanese companies are known to provide their employees with salaries that may also include bonus; paid monthly and two extra payments are provided in the month of June. Extra payments also depend on the bonus that an employee may receive. Although the salary structure may be found to be different in the different firms, yet in general the Japanese companies that also reflect the Tokyo companies, structure the salaries of employees based on their level of work and experience. Special payments for skillful performances are not common and are rarely observed. The companies do not make plans for any individual compensation or benefits and companies in the same industry generally have same levels of salaries and wages for their employees (Gross & Hewes, 1997). Availability of Housing, Education, etc.: Beijing in China has the records of providing easy housing solutions that are available within reasonable prices. Several agents are available who assist in the process of finding suitable homes. Different options are also available for different classes of people thus ranging the choices from reasonable to bigger budget houses (Beijing Housing Solutions, n.d.). China also finds the educational programs necessary thus availability of schools is also relevant in the country. Chinese children are provided with education at the early ages at small charges. Increasing number of private schools is also available for children who come from wealthy backgrounds (Mack, n.d.). Houses are available in Japan through lease contracts that are offered for private rental housing, publicly subsidized housing and privately owned housing. Certain rules and renting charges follow depending on the type of house that is rented. Availability of schools is not difficult for the country since education is considered to be highly significant by the Japanese people and they start their children’s education thinking about their future. This can be understood to be beneficial for organizations as well since educated and learned members can be expected to perform better and take better decisions. Employment in Japan requires fulfilling the country employment contracts. Medical and insurance facilities are also available, all facilities being provided to organizational members as well (Guide to living in Japan, n.d.). Other Compensations and Benefits: It has been observed in case of Chinese companies including companies in Beijing, a few of the major factors affecting the commitment and performances of the workforce within organizations. This leads to turnover of employees. Thus this highlights the importance of providing organizational members with additional compensations and benefits to satisfy their growing needs and demands. Monetary benefits are not the only benefits that Chinese personnel await. There are other factors as well necessary for enhancing employee loyalty, satisfaction, creates feelings of belonging and commitment of the employees towards the company. It has also been observed that the higher rates of turnover in Chinese companies are often due to the lack of compensation and benefits that the employees expect from the companies (Fan, 2010, pp.9-10). In Japan, several benefits are provided to the organizational employees that include housing, transportation, particular allowances for families, vacation, sick leave, pension and health benefits. Employees who are single may be facilitated with dormitory housing, along with transport grants. Family allowances, rental benefits, business trips expenditure as well as allowances for relocation are also provided as benefits by the Japanese including Tokyo companies. The benefits are decided upon the status of the employee in the organization and his/her seniority (Gross & Hewes, 1997). Language/Expatriates: Language is considered as a very important tool for the Chinese companies as they believe that a common language is necessary for successful communication across different countries and for different business purposes. Chinese companies are making use of the English language yet difficulties are still prevailing owing to lack of common vocabulary. Organizational members often have the tendency to consider the use of their own language as a cultural practice; however, in business situations this may not always be possible. Thus Western business expatriates handed over to China have been found to face difficulties in regard to the use of language (Selmer, 2006, pp.347-348). Religion and Orthodox Level: The country of China has beliefs on diverse religions that include Buddhism, Taoism, Islam, Catholicism and Protestantism and the population has the rights to choose and express their religious beliefs thus having their individual affiliations for different religions. These religions had their history in China since long years and several religious organizations are also available (Freedom of Religious Belief in China, 1997). Orthodoxy was prevalent in China since 1685. However, till the 1860s, there was lesser number of orthodox followers in Beijing. Gradually in and after the 19th century, the orthodoxy has been found to increase in the country (Orthodoxy in China, n.d.). Considering the lives in Tokyo and the follow of religions in Japan, Shinto and Buddhism have been found to be the mostly followed religions in the country. Christianity, Confucianism, and other religions are followed by a very less percentage of people (Tokyo-Customs & Culture, 2008). As reports present, there are around 25,000 Orthodox Christians in Japan. The Orthodox Church in Japan has a tradition of more than 100 years and is also the solitary Orthodox Church in the region of East Asia independent in nature (Establishment of the Orthodox Church in Japan, 2011). Other Norms of Business Community and Level of Formality: Norms in Chinese business communities involve utilization of time in decision making while doing business with other countries. Relationships are given special importance that is maintained through respecting each other as well as gifting and receiving presents. Business contracts are also taken utmost care of. However, knowing the processes of businesses is necessary to successfully deal with business partners in China. Formality is maintained at a lower level since businessmen in China believe in forming informal relationships once they get to know their business counterparts and the relationship is focused to be maintained for a long period of time (Chinese Business Culture, n.d.). The Japanese business norms also involve maintaining relationships although in a much formal and professional manner. Facts and achievements matter a lot to the Japanese companies. Meetings are required to be attended on time and business etiquettes need to be followed at the utmost level while dealing with business partners. Accordingly protocols are also maintained that dictate the norms and rules that may be needed in business dealings in Japan. Thus formality level in Japan can be observed to be at a higher level in comparison to China (Japanese business etiquette, 2010). Value of Time and Time Consciousness: Considering the data on China, it has been observed that people in China are becoming more time conscious than before with gradual passage of time. This is primarily because people are all the more realizing the importance of time in their lives as well as in business organizations. Accordingly, organizational working hours and time management are also getting importance in the country’s business respects (Chinese People More Time Conscious, n.d.). In regard to time consciousness, Japan was earlier found to create an allegory of punctuality, although they were not found to be very punctual in several situations when their leisure lives are also considered essential. However, gradually with time, time consciousness is occupying a significant role in the business aspects of the country. In the present scenario, Japan can be found to well known for its time management. Particularly business meetings are attended on sharp time. The companies in Japan including Tokyo have precise and accurate process management for maintenance of time giving utmost value to the management of time (The Formation of Time Consciousness in Modern Japan, 2010). Law Firm in Japan and International Human Resources Management: A study has been conducted on Allen & Overy, which is one of the top law firms in Tokyo, Japan. The company has formed its position among the leaders in legal practices in Japan. The company has its operations in diverse areas and focuses on imaginative and independent thought process. New and variety of views are encouraged that can be used in the dealings of legal issues. The company has a culture of building relationships with other firms and form networks. Resources including human resources are blended together towards successfully meeting the demands and expectations of their clients. The company focuses on involving the best people for its improved performances, thus internationally managing the human resources towards achievement of organizational goals (Our Practice, 2011). The success of the company reflects the effective management of its human resources. The employees of a company being a major part of the organizational success have been involved and focused to the utmost level that has enhanced improved performance of the company towards achieving the leading position in the industry. Conclusion: China and Japan are both well known for their business prospects and dealings with other countries. However, when the international human resources management is considered, both the countries reflect certain differences that play major roles in the organizational success of the companies in these countries. Having an overview on Tokyo and Beijing which are the capital cities of Japan and China respectively, differences have been observed in the human resources management that could be studied in the contexts of talent need, legal obligations, labor management relations, workforce competence, turnover rates, medical systems, cultural issues, structure of organizations, ethical factors, wages, availability of housing, education, etc., compensations & other benefits, language, religion, norms of businesses, formality, and time value. Studies on these respects clearly reveal that although the two countries may have some similarities in regard to the effects of legal obligations on HR activities, or the labor management relations, yet there are several differences in regard to the workforce satisfaction, ethics, norms, skills of employees and the manners in which the lack of positive attributes are addressed by the companies. While Japanese companies can be seen to take utmost care of their employees, giving them proper training and development opportunities, along with satisfactory salaries and other benefits, China on the other hand can be found to experience higher rates of turnover that clearly reflects the dissatisfaction of the employees. Moreover, the competences of workers in Japanese companies being greater than that of China, Japanese workers are more involved in the decision making processes of their organizations. Thus, from an overall study on the international human resources management in these two countries, it may be concluded and recommended that doing business dealings with Japan would provide a better business prospect for other countries. References 1) Average salary increase of urban workers rises to six-year high. (2008). 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