Topic 9 - The role of workers + Migrant workers + expatriate assignments

Summary

The role of workers

Recently, especially on countries such as Germany, the workers have had an increasing participation on the decision making process on the companies due to the fact that the labor unions in those countries are unified nationally and have gained more power due to this unity. In fact, in some cases, the employees and their representatives and the senior directives have the same power on the decision making process and the workers become as important as the stakeholders. This is the principle of Co-determination.

Image taken from http://xroads.virginia.edu/~ma98/pollklas/thesis/cod.html. Accessed on October 18th 2010.

Regarding the co-determination and the unionization, the employees are not just union members since their participation in the company goes beyond their labor activities by being part of the board of directives, having the same voting rights than the directors. Additionally, they also have the ability to influence the firm’s decisions and the distribution of profits.

Image taken from http://www.bryangbrown.com/editorial12.html. Accessed on October 18th 2010.

This co-determination makes that the workers have more empowerment than in countries where the labor unions are more divided and these unions protect more the rights and interests of the workers. Additionally, they may prefer business diversification in order to avoid a firm default in order to reduce risk and may also contradict the owners’ interests and objective to make them a more collective goal instead of a focused goal.

Migrant workers

A migrant is a person who moves freely from one country to another, for reasons of personal convenience and without intervention of an external compelling factor. However, one should consider the fact that in this definition the “freely” expression refers to the fact that they are not violently forced to leave, but probably the economic and/or social conditions of the home country make a person to choose to leave in order to have better conditions for him/her and his/her family.

Image taken from http://www.cartoonstock.com/newscartoons/directory/m/migrant_workers.asp. Accessed on October 18th 2010.

But, in order to understand the concept of migrant worker, there must be a distinction between migrant and immigrant, since the first one has a temporary residence and the second one looks for a permanent one. The categories of migrants are mainly:

· Job seekers, who look for a better work.

· Students who are looking for better educational opportunities.

· Family members of migrants who want to be reunited with family members, but they are not as influential for this subject, since they travel for a very short time period and they don’t affect directly a company.

The types of migrants could be classified as:

· Migrant workers: person who is to be engaged in a remunerated activity in a State different from his/her nationality.

· Special cases: such as students and trainees, refugees and Stateless people and people employed by a State but who live outside its territory.

The role of workers

Based on the required reading and the class presentation about this topic, please answer the following question:

Analyze the potential implications of the Co-determination principles over the organization’s decision making process from the perspectives of the managers and the employees.

Required reading: Piette, Jean-Jacques. 2004. “Understanding Management German style”. Les Amis de L’ecole de Paris.

Image taken from http://www.smud.org/en/board/Pages/brdmtgs.aspx. Accessed on October 18th 2010.

Managers’ perspective

· More time would be required to take decisions, since there are more people involved in the decision-making process and having everybody agree with a choice will take more time.

· Since most of the Unions are conformed by workers who have just a high school degree or a technical degree, they might want to take some decisions that are financially impossible to achieve to the company, and if the company doesn’t take into account those wishes, then a powerful Union might cause some troubles to them.

· Due to the fact that strikes are not allowed in some countries that apply the co-determination, therefore the workers won’t leave their jobs to claim their rights since they have an important representation on the board of directors and the productivity will not decrease as a result of a massive strike.

· A powerful Union might impose some policies that are not easily achievable to the company; such as a high salary rise, huge improvements to the work conditions, among others; and those policies might ruin the company if there is a critic environment.

Employees’ perspective

· Since, in order to have consensus the board of directors must take into consideration the position of the unions, some arbitrary decisions will be abolished and the workers view will be considered when taking some decisions and their welfare will be taken into account.

· They might give some opinions and thoughts about the productive, and even managerial, processes; which give them more chances to increase their position in the company.

· Since strikes are not allowed in some countries that apply the co-determination, they won’t need to leave their jobs if they are not agree with the union’s point of view and, therefore, they are not forced to make strikes if they want to keep working. That’s why the workers have a representation in the board of directors, to have a voice there in order to protect their rights.

Resources

• Class presentations: The role of workers, Migrant workers and Expatriate assignments.

• Piette, Jean-Jacques. 2004. "Understanding management German style". Les amis de L'ecole de Paris.
  

Topic 8 - Merging OC

Summary

The most important objective when creating successful acquisitions is the value creation. However, the real value is not created unless capabilities are transferred and the employees from the two organizations that are part of the acquisition team up to create the expected benefits and the unpredicted opportunities. The will and skills of the managers of the companies to work and teaming with a common future oriented goal are the requirements for this collaboration to rely on. Acquiring involvement of the people involved without risking or compromising the strategic tasks of the company is the key to integration.Image taken from http://venturebeat.com/2010/08/05/new-report-q2-sees-uptick-in-blockbuster-ma/ Accessed on October 11th 2010.


In order to avoid any type of dissatisfaction from the employees, managers have attempted to find similar organizational cultures and management styles since it could undermine merging and acquisitions’ performance. In contrast, managing cultural differences is more realistic and easier to obtain, additionally; it has been a more successful strategy in an integration process than finding the “ideal culture fit”.

Image taken from http://www.paddypowertrader.com/blog/index.php/financial-concepts-explained/mergers-and-acquisitions-explained/ Accessed on October 11th 2010.


An effective integration can be defined as the combination of firms into a single unity or group, generating joint efforts to fulfill the goals of the new organization, but this combination is often blocked by the challenges of nationality and perceived cultural differences. Contrary to an obvious choice of picking people with the same culture, believes and nationality; international mergers are more likely to bring together employees with different values and beliefs about the work place because merging implies the reconstruction of a new social identity.

Two organizational integration variables are particularly relevant in the acquisition process: the motive for the acquisition (such as the strategic fit and decision making process) and the process of implementation (including the acculturation process). The acculturative process describes the cultural changes resulting from the interaction of one organizational culture with another. A basic acculturative process occurs between the conflictive subgroup desires for cultural differentiation and organizational forces for integration. The reason for an acquisition is important because it will influence the degree of required interaction between members of each organization.

Image taken fromhttp://www.northern.edu/Academics/Departments/International_Programs/Intensive%20English%20Program/Pages/default.aspx Accessed on October 11th 2010.

Many organizational alliances fail to meet expectations because of difficulties in the acculturation process which would compromise the knowledge transfer and learning to occur. In order to avoid this situation, the success of a particular integration strategy depends mainly on the manager’s ability to reconcile the need for strategic interdependence between the two firms and the need for organizational autonomy.

Summary taken from: Alzira Salama, Wayne Holland, Gerald Vinten, (2003) "Challenges and Opportunities in Mergers and Acquisitions: Three International Case Studies – Deutsche Bank-Bankers Trust; British Petroleum-Amoco; Ford-Volvo", Journal of European Industrial Training, Vol. 27 Iss: 6, pp.313 – 321.

Based on the required reading for this module, list and explain - using evidence from the cases presented in the reading - the main challenges and opportunities arising in processes of mergers and acquisitions from an organizational culture perspective. Include at least 3 challenges and 3 opportunities. Required reading: Alzira Salama, Wayne Holland, Gerald Vinten, (2003) "Challenges and Opportunities in Mergers and Acquisitions: Three International Case Studies – Deutsche Bank-Bankers Trust; British Petroleum-Amoco; Ford-Volvo", Journal of European Industrial Training, Vol. 27 Iss: 6, pp.313 – 321.

Challenges in the process of mergers and acquisitions
• As stated in the chapter, the international mergers are expected to unite people with different values and believes about the workplace and this merging implies that a new culture must be created from the mixing of the two previous ones, since a country’s ideologies and relation systems increase the national distinctiveness of organizations. In the case of British Petroleum and Amoco, the BP managers worked in an Integration process that would assure that the people would guarantee a successful merging process. They focused on combining two head offices and merging two operating divisions. In the post-merger phase, the BP managers created several steps in order to successfully integrate those companies: the integrating duplicated areas (explaining how would be the decision on the common assets, the cost of each unit produced, the benchmarking and the desired future situation), the establishment of the management for the new company (creating opportunities for personnel in both companies), the integrating systems (to uncover the best practices inside each organization) and the building of a new corporate culture for the future organization (socialize BP’s operating philosophy and mix it with their counterparts from Amoco).
Image taken from http://arsnotoria.blogspot.com/2010/05/british-petroleum-now-bp-amocos-mafia.html Accessed on October 11th 2010.

• The acculturative process that describes the cultural changes resulting from the interaction of one organizational culture with another, since many organizational alliances can’t achieve their goals due to the hard and difficult acculturation process that could compromise the knowledge transfer and learning. In the case of Volvo and Ford, one can notice the high difference in both companies’ organizational practices, since in the first one they were decentralized and teamwork oriented and in the second one they were highly centralized and individualistic. The acculturation process in this acquisition had several steps in order to be successful, such as the recognition by Volvo that now they won’t have the same representation in the production line, the designing of a new organizational structure by dividing the Ford line and the Volvo line and the due-diligence period and the post-acquisition strategies on a six-month period focused mainly on potential financial synergies.

• The manager’s ability to reconcile the need for strategic interdependence between the two firms and the need for organizational autonomy. In the case of Deutsche Bank and Bankers Trust, the crucial successful action taken by the top management of Deutsche Bank was the way they used the adequate time used between the announcement of the deal and the closing of it. Also, during the due-diligence period, DB top management decided to undertake a cultural assessment exercise to minimize a culture clash between the two banks.
Image taken from http://www.stockwatch.in/deutsche-bank-picks-20-stake-mumbaibased-rama-cylinders-21780 Accessed on October 11th 2010.

Opportunities in the process of mergers and acquisitions
• The acquisition of new competences and knowledge.
• The creation of value by the transferring of capabilities and skills when people from both organizations collaborate to create the expected benefits.
• Differences in organizational culture and practices create unique learning opportunities for the partner firms.

In the case of Deutsche Bank and Bankers Trust, the good timing and integration strategies contributed to the acquisition success. Additionally, good communication from management to the employees allowed to avoid any type of cultural conflict and kept their name without losing the sense of belonging (Deutsche Bank-Alex Brown Investment Bank).

In the case of British Petroleum and Amoco, they uncovered the best practices inside each organization. For instance, BP performance management process was considered the best one in terms of generating a more efficient performance and the Amoco business model was adopted when allocating capital.

In the case of Volvo and Ford, there was created a new organizational structure to cover more areas due to the specialization. Ford Motor Company established two major divisions: Premium Automotive Group and Ford Cars. Ford focused on the traditional products with their Ford Cars division and Volvo focused on premium products, such as Jaguar, Land-Rover, Aston Martin, Lincoln and Volvo.
Image taken from http://www.cartuningcentral.com/tag/volvo Accessed on October 11th 2010

Topic 6: East Asia

Summary

The Japanese management style is characterized by:
• Not all the companies are alike.
• They are based on a market share-growth strategy.
• They have an aggressive price strategy in order to achieve economies of scale which lead them to a price war to reach more consumers.
• They are value maximization tended.
• Their relationship with the suppliers are seen as an inter-organizational perspective, where suppliers are seen as part of the organization in order to adapt better and easier to the changes because of a good coordination.

The best example of a successful Japanese management style is Zaibatsu, which began as diversified family enterprises that rose to prominence in the Meiji Era; they gained a privileged position in the Japanese economy by receiving subsidies from the State and favorable tax policies, additionally the government granted them a privileged position in the economic development of Japan. An example of their influence was that on the decade of the 30’s they controlled one third of the bank accounts and one third of the foreign trade of the country and, since they had their own banks, they had autonomy on who they would finance and safe financial taxes.

The Korean management style is characterized by:
• Being a Japanese colony from 1910 to 1945, so their managerial practices are influenced by Japan.
• In the 70’s and 80’s they still sought Japan as an economic development model.
• They had government intervention in aspects such as credits, foreign exchange rationing and benefits for exports growth.
• As a result the favored firms grew at a faster rate and diversified their economies better, but the gap between big and small firms widened.

A successful Korean management model is the Chaebol, which is a large conglomerate of family-controlled firms characterized by having strong ties with the government and is modeled on the Zaibatsu model. However, there are some differences of the Chaebol regarding the Zaibatsu: on Korea there is prohibited to own banks, since they are nationalized, they had special privileges from the government which lead them in some cases to grow because they borrowed vast funds instead of production growth.

The convergence occurs when as countries develop, management styles will converge to a model found in developed countries. Differentiation is a wider set of cultural norms in each society that acts as a powerful force that differentiates the culture and practices across borders.

On the convergence model there are two main pressures that determine if a management style tends to be homogeneous or not:
• Domestic pressure to retain culturally determined forms of management.
• International pressure to confront to conventional norms in the international marketplace.

Explain the phenomenon of convergence in terms of management styles. What are the forces or factors pushing for convergence?

Convergence in terms of management style refers to acquiring similarities in order to emulate a management practice from another country. Additionally, as countries develop, management styles will converge to a model fund in developed countries in order to copy the trends that are considered as the best managerial practices in order to reach a homogeneous practice. The forces or factors that push for convergence are mainly the international pressure to reach some standards that are established by the market in order to survive in a competitive environment (or isomorphism).

Explain the phenomenon of differentiation in terms of management styles. What are the forces of factors pushing for differentiation?

Differentiation in terms of management style is a set of forces which try to avoid homogeneity in the managerial practices of a certain country or culture in order to be differentiated and have identity and a proper style. The forces that push for differentiation are mainly the national culture and the national identity that try to keep an identity from a dominant culture.

Topic 4: Communication + Virtual Teams

Summary

Communication is how the ideas are transmitted between people through different means. The most common and known communication way is the interpersonal communication, which is the base for building and maintaining relationships. There are four main elements for this type of communication: the communicator, the receiver, the perceptual screens and the message. In order to have a good communication, the listener must be reflective, and the characteristics of this type of listener are: pay attention to the sender of the information, giving an appropriate feedback and try to correct any mistake that occurs during this process.

The effective managers must communicate in a proper way to make them clear, that’s why they must be: expressive speakers and express openly in order to show what they want to achieve, empathetic listeners and being willing to listen, persuasive leaders and motivate other people to achieve goals and not just giving orders, sensitive to feelings and improve the self-esteem of the employees, and finally informative and provide the necessary information to the employees.

The main principles of an effective communication are:
• Clarity: to give an idea clearly.
• Objective: don’t take any side when giving the information.
• Understanding: to give the information completely and avoid missing any important detail.
• Consistency: to have the same position during the communication.
• Completeness: to include all the relevant information.
• Feedback: to return the message given in order to be sure that the information was well received.
• Time: giving the information in the time required.

The concept of Team Work was established mainly in the decade of the 90’s, when the empowerment was the top managerial practice in order to avoid bureaucracy, reduce the time of the decision making and to improve service. Now, in the new millennium, there is a new practice called Virtual Teams in which members work in more than one physical location and is supported mainly by the use of technology as a communication mediator.

There are some characteristics of the virtual teams that are relevant: they are geographically dispersed, are driven by a common purpose, are enabled by communication technologies, normally they are not big and requires workers with different and complementary knowledge. The use of virtual teams might be a solution to enhance the performance and competitiveness and can represent also opportunities for intellectual growth and the transfer of information.

There are some advantages of using the virtual teams, such as:
• Relocation of time and costs.
• Time to market to be present where the market changes occur and improve coordination.
• Linking experts that could be difficult to communicate in a face to face situation and to increase the chances to communicate them.
• Productivity due to the short time to develop new products.
• Flexibility because changes are implemented easier.

However, there are some disadvantages of using virtual teams, such as:

• Lack of face-to-face conversations that difficult the understanding of the situation.
• The members of the team must be very responsible and honest when doing a self-monitoring.
• Possible mistrust, conflicts and power struggles.
• Cultural distance.

In this chart are shown the differences between Virtual and Traditional Teams
Virtual Teams Traditional Teams
Different locations and time zones Same workplace
Structured responsibilities Task coordination is given at the beginning
Communication through technological devices Face-to-face communication

Source: Class presentations Communication and Virtual Teams from Cristina Robledo.

Communication is a process that allows organizations to send/receive messages within their own boundaries but also to interact with outside entities (customers, suppliers, the media, etc.). Messages are send/received not only through oral and written statements, there are many channels and ways that need to be considered when discussing effective organizational communication. In that sense, the use of sounds has become increasingly important.

Based on the article “If Intercontinental were a sound…what would it be?”*, Please discuss the implications (potential advantages, disadvantages, challenges, etc.) of using sounds to send strategic messages. You need to integrate the use of key concepts relating to the topic of communication to support your answer.

Now days, the use of jingles or short musical themes are very common for a brand to have a position in the market and to be recognized, so it’s a very common practice to improve the recognition. As stated by the case “If InterContinental were a sound… what would it be?”:

"In reality artistic procedures are highly disciplined and can be effective catalysts in building and reinforcing better business practices. They can also provoke valuable insights well beyond the territories of the initial belief” [1]

Some of those sounds help the brand to be recognized by the customers since they are simple messages that don’t require the receiver to decode very complex information and might have an easier and faster response to the company. Sometimes, when the correct jingle is presented to the people when making some advertisement or presenting the company (such as a relaxing music, a rhythmic sound or other different) might increases the chances that the receivers of the message requires less time to response and give a feedback (that in this case could be to increase the chances to use more the InterContinental services).

Another advantage of using sounds as a strategic message is that there is no need to speak, and it implies that the message will be received equally to all type of languages and the codification of that information will be the same, so there will be no need to adapt the jingle to different languages and avoid one of the stronger communication barriers which is the Different Language. Additionally, since there is no singing on that sound, there wouldn’t be a semantic confusion that would lead to a misunderstanding of the information sent.

Possible disadvantages come when realizing that today’s world has a huge sound contamination, especially on the cities, and another sound to the environment could be perceived as negatively. Additionally the sound might be perceived differently due to the difference of the people regarding cultural tradition, age, gender, education and so on, because certain group of people might be pleased with certain sound but other group might perceive it as disgusting, so having a sound that pleases all the potential customers must be very adequate.

However, a great challenge to take into account is the fact that it is difficult to find which is the right sound that can express what the company wants to have in order to represent them correctly. As stated by the case, “it was necessary to learn how to explain logically the musical requirements for the brand” ². To choose the correct jingle is vital to show the right purpose of the company, which is their focus, to which people they want to reach, because it’s not the same to have classical music than a salsa rhythm when promoting a hotel that their main focus is the exclusivity to their customers. That’s why the sound (or could be called as well “the message”) must be clear and consistent in order to avoid ambiguity, have the adequate timing and being objective.

[1] Spencer, Michael. If Intercontinental were a sound… what would it be? P. 39.
² Spencer, Michael. If Intercontinental were a sound… what would it be? P. 41.

Sources:
Robledo Ardila, Cristina. Class presentation: Topic 7: Communication.
Spencer, Michael. If InterContinental were a sound... what would it be?

Topic 3 Motivation

Summary
Motivation is, according to the Real Academia de la Lengua Española, the “mental preparation of an action to cheer or animate to do it with interest and conscientiousness” . It’s how the people feels cheered about doing something in order to awake and sustain certain behaviors, especially when it is goal oriented.
Image taken from http://pollitoworld.blogspot.com/2009_07_01_archive.html, accessed on August 30th 2010.

In order to understand the human motivation, there have been created some theories that explain why the motivation exists. The main theories say that the motivation explains the behavior of a person (why a person behaves of some way), also that motivation predicts behavior (how a person will behave with certain motivations) and that influences behavior.

The reason for the human need of motivation is explained by two different types of needs:
• Internal needs: in which there are two main thinkers: Max Weber, who said that (as of the Protestantism) the work was necessary to achieve satisfaction, as the Protestants believe that salvation comes from the hard work instead of the sacrifice; and Sigmund Freud, who said that the motivation was part of the unconscious nature of the humans.
Image taken from http://www.ludumdare.com/compo/tag/no-motivation/, accessed on August 30th 2010.
• External incentives: those incentives come from external factors, such as interests and economic gaining, timing and controlling as proposed by Frederick Taylor and the self interest against the collective interests.
Image taken from http://myownhometown.blogspot.com/2008/05/motivation.html, accessed on August 30th 2010.

Some of the main motivational theories are:
1. Maslow’s hierarchy of needs: He divided the needs into five main needs:

Image taken from http://mktg343.pbworks.com/Maslow%27s-Hierarchy, accessed on August 30th 2010.

From this theory raises the Theory X and Theory Y of Douglas McGregor, in which the theory X explains the lower needs (in which the people dislike working and the motivation is centered on payments and security) and the theory Y explains the higher needs (in which the people like working and the main motivations are the job satisfaction and achievement of commitments).

2. McClelland’s need theory: This theory says that there are three main needs for a worker, the achievement, in which the motivation is the challenge and feedback; the affiliation, in which the motivation is the cooperative and harmonious environment; and the power, in which the main motivation is the chance to manage others.

Image taken from http://faculty.css.edu/dswenson/web/LEAD/McClelland.html, accessed on August 30th 2010.

3. Herzberg’s two-factor theory: the satisfaction or dissatisfaction at work depends on two main factors: Motivation factors, such as the recognition and challenge; and the Hygiene factors, such as job security and salaries.

Image taken from http://www.examstutor.com/business/resources/studyroom/people_and_organisations/motivation_theory/7-makingconnections.php, accessed on August 30th 2010.

4. Expectancy theory: explained by Vroom (1932) in which he said that the motivation is the result of the effort, performance and reward.

Source: Class presentation Motivation from Cristina Robledo.

1. What are the Hawthorne Studies? Explain its importance for studying motivation at the workplace and its influence over diverse motivation theories. (Include key findings and limitations) (max. 500 words)

The Hawthorne studies are researches that were held on the Western Electric’s Hawthorne (Chicago, Illinois) from 1927 to 1932 in which some investigators from the company and the Harvard University examined how the changes in the work environment (such as the lighting, music and other variables) and the economical incentives affected the performance of the workers on the production area. The results that the studies showed were that slight changes of the environmental conditions didn’t affect considerably the performance of the workers, unless the changes were so drastic that they couldn’t do their jobs normally. However, the economical incentives stimulated the performance of the whole group instead of the individual one. [1]

Image taken from http://leadinganswers.typepad.com/leading_answers/2010/02/smart-metrics-slides.html, accessed on August 30th 2010.

Its importance for studying motivation at the workplace is that these studies show which the real motivations for the employees are, in order to perform in the best way possible, instead of just taking into account the different motivation theories and don’t apply anything on the real world. Also it´s important because this study reveals the specific motivations of certain group instead of taking general conclusions, therefore the managers will know how to motivate that specific group and to improve their performance.

Image taken from http://ahp.apps01.yorku.ca/?p=710, accessed on August 30th 2010.

The influence that these studies have over the different motivation theories is that they put into practice the different concepts of each theory and also complements with practical facts from each group of work inside a company or a factory. These studies are important because they help to bring the theoretical factors into a more realistic and practical point of view and to make the managers to consider which are the most favorable motivational factors that will help the company as a whole to increase the performance.

2. Based on the class activity about "Flight 001: Motivating Employees", please answer the following question:

¿Which motivation theory do you think has the most relevance for understanding the behavior of Amanda Shank and fostering her motivation at work? (Max. 500 words)

According to the reviews in class and the readings, the theory that has the most relevance for understanding the behavior of Amanda Shank in Flight 001 is the Theory Y from Douglas McGregor, because her main motivation at work had more challenges than in her previous job, also she was considered a valuable member of the organization and those facts made her to appreciate and enjoy her work. Additionally, she was proactive in her job, such as giving full reports about the performance of the customers after the addition of some fees, which made her boss to consider her a worker with great potential and capabilities of rise in position. According to the theory Y, the main motivations come from assuming responsibility and contributing to the organization’s goals, through achievement of the commitments and the creativity, which Amanda had in the job at Flight 001.

However, there are some other motivation theories that are relevant in order to recognize the behavior of Amanda Shank on work. The McClelland’s need theory also explains this situation, as the Achievement need is shown in this case. The Acquired needs for Achievement are excellence, challenging goals and persistence and is obtained by having challenging projects (but with reachable goals) and having the respective feedback from the boss, which Amanda had in this job. It is constantly said in the case that Amanda was not pursuing a fortune by working and that the money was not her main goal when working, but to have recognition and feedback from her boss.

Another theory that applies for this situation is the Maslow’s hierarchy of needs, since her three basic level needs were achieved; her main objective was to achieve the esteem needs (which are the achievement, job status, work responsibilities and to improve her reputation).

The reading is available at: Nelson, D.L. & Quick, J.C. 2010. Organizational Behavior: Science, The Real World and You. South-Western College Publication, 7th. Pp. 1178-179.

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[1] General idea taken from http://www.beechmontcrest.com/hawthorne_studies.htm. Accessed on August 23^rd 2010.