HP Dilemma?• Can the sense that the HP Way was

“dead” be reversed?• Could the HP Way be applied in

developing countries with different cultures and traditions?

• How much autonomy should major business areas have in strategy, policy, management practice?

• Can HP avoid failure, following success?

HP Dilemma?

• Getting too big to practice HP Way?• How can we believe in HP Way when

people are losing their jobs?• Why don’t practices apply equally across

company anymore?• Can the HP Way survive in today’s

intensely competitive environment?

HP Way

• Corporate objectives• Business values• Management practices

= Competitive Advantage: People– Teamwork– Performance

Corporate Culture• Values, customs, traditions & meanings that

make a company• Beliefs about goals an organization should

pursue• Ideas about the appropriate behavior to

achieve goals• “How things get done around here”• Values determine norms, guidelines or

expectations• “A pattern of shared basic assumptions that

the group learned as it solved its problems of external adaptation and internal integration”

Corporate Culture”Organizational Culture and Leadership" (1992), Schein

1. Artifacts: surface aspects (such as dress) easily discerned, yet hard to understand

2. Espoused Values: conscious strategies, goals and philosophies

3. Underlying Assumptions and Values: the core, or essence, of culture, difficult to discern as they exist at a largely unconscious level. Key to understanding why things happen as they do.

Organizational Culture - ElementsRite, Ceremony or Ritual

Planned activities that consolidate cultural expressions into an event, usually for the benefit of an audience

Myth or Saga Dramatic narrative of imagined events to explain origins, transformations or unique accomplishments of group or leaders

Legend Handed-down narrative of important events based in history, but embellished with fictional details

Story Narrative based on true events-often combined with fiction

Folktale Completely fictional narrative Symbol Object, act, event, quality, or relation to convey meaning

or represent another thing Language Use of words and phrases to convey meaning Physical Physical setting or sensory stimuli Artifact Material objects that facilitate culturally expressive

activities

Leading Change(Kotter, 1996)

1. Establish a sense of urgency

2. Form a powerful guiding coalition/team

3. Create a clear vision, expressed simply

4. Communicate the vision

5. Empower others to act on the vision

6. Plan for, and create, short-term wins

7. Consolidate improvements and produce still more change

8. Institutionalize the new approaches

Why Is Managing Human Resources So Important?

• Rapid Change

• Uncertainty About Basic Business Conditions

• Rising Costs

• Rapid Technological Change

• More Limited Supplies of Highly Trained Labor

• Rapidly Changing Government Legislation and Regulations

• Increased Globalization of Industries

Fitting HR Practices to Business Strategy and One Another

• Vertical Fit = the match between HR practices and overall business strategy

• Horizontal fit = the consistency and interrelationship among HR activities

• External fit = how well HR activities match the demands of the external environment

HR Fit Requires Right HR Choices

• Staffing

• Appraising

• Compensating

• Training and Development

• Employee Influence

• Work Systems

Approaches to IHRM

• Factors Affecting the Approach to IHRM – Political Policies and Legal Regulations– Managerial, Educational, and

Technological Development in the Host Country

– Home and Host Country Cultures– International Experience of the Firm

Approaches to IHRM

• Factors Affecting the Approach to IHRM (cont’d)

– Method of Subsidiary Founding– Technology and the Nature of the Product– Strategic Importance of Particular Employee

Groups– Organizational Culture– Organizational Life Cycle

Managing Human Resources in a Foreign Subsidiary

• Culture and HR Functions within a Foreign Subsidiary

• Staffing in the Subsidiary

• Training in the Subsidiary

• Appraising Performance of Subsidiary Staff

• Subsidiary Compensation Systems

Approaches to IHRM

• Ethnocentric Approach– Uniform strategy across units– Exporting HR practices from home country– Expatriates run HRM functions in subsidiaries

• Polycentric Approach– Diverse strategies across units, independent from HQ– Policies adapted to meet circumstances, context– Local managers direct HRM

• Closed Hybrid Approach– Compromise between Ethnocentric & Polycentric– Uses parent country template, adapted to local conditions

Approaches to IHRM

• Regiocentric Approach– Regional grouping & integration of HR strategy– Differentiation across regions– Staffed by managers from countries within region

• Geocentric Approach– Policies developed to meet goals of global network of home-country &

foreign subsidiaries– Global overarching strategy on key issues– Differentiated policies on local issues

• Open Hybrid Model– Subsidiary practices are a hybrid of activities meeting global and local

demands– Extensive sharing of best practices among subsidiaries– Best practices of home & host countries applied in integrative manner