common errors leading to conflictual cba’s 2003 am cham hr seminar jean luc scalabre – premium...

Common Errors leading to Common Errors leading to

Conflictual CBA’sConflictual CBA’s

2003 Am Cham HR Seminar2003 Am Cham HR Seminar

Jean Luc Scalabre – Premium Partners Korea LtdJean Luc Scalabre – Premium Partners Korea [email protected]

J.L.Scalabre – Premium Partners International – AmCham HR Seminar 2003

Learning EffectivenessLearning Effectiveness

Degree of Involvement

Learn

ing E

ffect

iveness

ReadingsReadings

LecturesLectures

DiscussionsDiscussions

Case Studies

Case Studies

SimulationsSimulations

Good Experience

Good Experience

Bad Experience

Bad Experience

E-Learning ?

E-Learning ?


IntroductionIntroduction

Korea is at the same time an “advanced society” and a “very

traditional and complex society”: unique case

Korea is very different from most other countries for foreign

companies: experience acquired elsewhere does not translate

well

Newcomers or new organisations usually not well prepared for

tough labor relations & CBA negotiations

Korean workers have inaccurate, unclear perception of working

ethics & practices in MNC’s: high expectations

MNC Managers do not understand well enough…or too late

Korean culture

Management Culture GapManagement Culture Gap


IntroductionIntroduction

Conflictual CBA negotiations with extravagant requests are

usually the result of a failed Change Management Process during

which same errors are committed by many companies, across

industries:

Failure to establish a constructive dialogue with Labor and their

representatives, and

Failure to convince them of the necessity to Change and to moderate

their expectations/requests

Insufficient preparation of the CBA process by the Management group

Experience and Academic Research show that same errors are

committed over and over again by most organisations in spite of

predictable behavior and reaction of Labor to Change

Management efforts


Common Errors leading to Conflictual CBA’sCommon Errors leading to Conflictual CBA’s

1.1. Under estimating the CBA challenge, lack of preparationUnder estimating the CBA challenge, lack of preparation

2.2. Failure to build a Management Team leading the ChangeFailure to build a Management Team leading the Change

3.3. Not understanding the Culture & Negotiation Style. Not understanding the Culture & Negotiation Style.

4.4. Rushing the Changes & Failing to create a Transition Period.Rushing the Changes & Failing to create a Transition Period.

5.5. Failure to raise awareness about the need to ChangeFailure to raise awareness about the need to Change

6.6. Failure to establish Communication with WorkersFailure to establish Communication with Workers

7.7. Failure to set clear objectives and celebrate early successFailure to set clear objectives and celebrate early success

8.8. Not removing Barriers and ObstaclesNot removing Barriers and Obstacles

9.9. Failure to recognize “Labor representatives”Failure to recognize “Labor representatives”


1. 1. Under estimating the challenge, Under estimating the challenge, lack of preparationlack of preparation

CBA negotiation is a very formal process and often the main (or

only) forum for workers and their representatives:

to voice their concerns

to express their requests

CBA negotiations culminate months of preparation by organised

labor: Labor comes prepared with a mandate & clear objectives

Due to workers’ high expectations and Cultural Gap, the

Challenges to create a necessary “new business culture” often

underestimated by all parties: management and workers

"Hope for the best, but prepare for the worst."


2. 2. Failing to build a Management Team Failing to build a Management Team

leading the required changesleading the required changes

Major changes are impossible without the active support and involvement of the organization head + the management group:

Leadership to create a new Vision

Management groups often heterogeneous: Expatriates + Koreans + new hires:

Team Building

Consensus & Shared objectives

Not involving middle management and supervisors, to reach front line workers:

Empowerment

Mobilization of Commitment


3. 3. Not understanding the Culture & Not understanding the Culture &

negotiation stylenegotiation style

Surveys and Experience show that Cultural factors remain main

reasons for failed transformation efforts: over 50% failure rate

Mutual understanding of cultural background and business culture

is required to prepare the ground for a new “Comfort Zone”, a

new Business Culture

In the name of GLOBALIZATION, HQ Corporate Culture and Models

cannot be “transplanted” without adaptation: high risk of

“rejection”

Negotiation style very different:

Unrealistic demands, face saving, slow process, external

influence….

No WIN / WIN Concept


Comfort Zone Comfort Zone

Managers Employees

Cultural Gap

CurrentCurrentNew CoNew Co Cultural ScaleCultural Scale

Cultural Clash PathCultural Clash Path


Conflict Zone

Comfort ZoneComfort Zone Comfort ZoneComfort Zone

ManagersManagers EmployeesEmployees

Cultural GapCultural Gap

CurrentCurrentNew CoNew Co Cultural ScaleCultural Scale

Cultural Clash PathCultural Clash Path


4. 4. Rushing the Changes. Failure to create Rushing the Changes. Failure to create

a Transition Period & to grieve the Pasta Transition Period & to grieve the Past

Major transformation efforts require time to take place,

with many people involved

Rushing Changes without addressing psychological issues

and going through a Transition phase will stiffen

employee resistance:

Unless a Transition occurs (in the mind) Change will not

take place and work

Management has to Plan and Manage a Transition phase:

To let go the past, to mourn it, to unlearn the old way…


Transition CurveTransition Curve

Degree of Involvement / Time

Deg

ree o

f C

han

ge

Mora

le, pro

duct

ivit

y, C

om

mit

ment

Endings

New Beginings

Neutral Zone


5. 5. Failing to raise awareness about Failing to raise awareness about

the need to Changethe need to Change

Many Managers:

Overestimate how much and how fast they can force big changes in organizations

Underestimate how hard it is to drive people out of their comfort zone

Mis-judge / overestimate the level of urgency they have created

Most change efforts fail at the start if a proper sense of urgency is not created, if complacency is too high

50% of companies fail at that stage by not creating the conditions to convince people to adhere to the transformation effort and to convince them of its necessity


6. 6. Failing to Communicate with LaborFailing to Communicate with Labor

Communication with employees a major issue for most MNC:

Language barrierLanguage barrier

Culture barrierCulture barrier

Insufficient and inconsistent communication, lack of support by

management group, inadequate communication vehicles are most

common errors

Managers often (wrongly) assume that a few meetings / memos /

workshops will do the job and move on too quickly to the next step

Cascading down to the worker level, management objectives,

guidelines, new policies remains a major issue and requires close

monitoring & involvement by Top Management


Communicating Changes TipsCommunicating Changes Tips

1. Specify the nature of the changes. Be specific, realistic. Explain why, how,

when, how much….

2. Let employee know the scope of a change even if it is bad news. Prevent

false rumors. They travel fast and well.

3. Repeat, repeat and repeat again the purpose of the change and the

actions planned. Avoid misunderstanding and false rumors.

4. Make sure communication is two-way (feedback) and use multi-channel

communication

5. Target supervisors and influencers

6. Support change with new learning

7. Point to real progress to keep momentum and credibility

8. Model the changes yourself: “walk the talk”.


7. 7. Failing to set clear objectives and Failing to set clear objectives and

celebrate early successcelebrate early success

Real transformation take time and require a lot of efforts by

many people

Without short term wins linked to clear objectives, many

people will give up, lose confidence or join the ranks of

those actively resisting the Changes

Importance of these short term wins to keep momentum is

underestimated

Create an active reward plan: Recognition, social events,

promotion, money…..


8. 8. Not removing Barriers and Not removing Barriers and ObstaclesObstacles

In low confrontation cultures, rigid companies, obstacles & real

issues are sometime difficult to identify

Doing nothing will seriously alter the change process

Obstacles must be removed to maintain the momentum and not

derail the transformation process:

Structural barriers

Lack of appropriate skills

Systems and the Vision not aligned

Troublesome supervisors


9. 9. Failure to recognize Labor Failure to recognize Labor RepresentativesRepresentatives

Employees’s representatives are expecting to be “visibly and

officially” recognized by Management through:

Office facilities

Budget allowance to operate

Full time representatives

Unless recognition takes place, Union will not start negotiating

and suspect Management of “lack of good faith and trust”.

Recognition by Management is first step by Labor Representatives

to consolidate power and “force” Management to concede

representation, even to a minority and hostile group

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