managing gwf sharing

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Managing a GlobalIntegratedWorkforce

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Expansion in a Globalised Economy

As companies stake their growth strategies on global expansion and the pursuit of

new markets, their ability to forge a human capital strategy and HR capability that is

both globally consistent and locally relevant will be critical to success.i

Globalization and Workforce migration has created opportunities for individual and

corporation, however it brought along new issues that challenge strategic

frameworks developed in the past while forcing organizations at the same time

examine their internal strategies to remain competitive and rejuvenate its global

workforce to create a sustainable future.

To illustrate this, let us look at the case of Toyota struggling with organizational

structure. Toyota Motor Corporation was referred to the gold standard of the

automotive industry and to customers they were known for quality and customer

care. The driving force behind their success is the practise of Toyota Production

System (TPS). TPS is built on the principles of just-in-time production. It means

that raw materials and supplies are delivered to the assembly line exactly at the time

they are to be used. It emphasizes on the importance of efficiency and minimizes

wasted resources. TPS also empowered the employees at the front line to pull a

cord and stop the manufacturing line when they see a problem. This process

ensures cars were made and delivered Right First Time, enforcing the core values

of quality and customer care. It led the company to overtake General Motors and

Chrysler in terms of sales growth during the global financial crisis. However from

2009 2010, Toyota recalled over 8 million of vehicles due to defects. ii

Organizational Structure of Global Workforce

How could this happen to a company known for quality and customer care? Let us

examine this further.

Toyotas board of directors is composed of 29 Japanese men, all of whom areToyota insiders. As a result of its centralized power structure, authority is not


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generally delegated within the company; all U.S. executives are assigned a

Japanese boss to mentor them, and no Toyota executive in the United States is

authorized to issue a recall. Most information flow is one-way, back to Japan where

decisions are made. iii

The organizational structure of Toyota resembles a Mechanistic structure which

similar to a bureaucracy. These structures are highly formalized and centralized,

often rigid and resist to changes. It is slow to react to market changes and does not

encourage innovation.

The downside of a Mechanistic structure is that it inhibits entrepreneurial spirit and

discourages individual initiative in doing whats right for the business. This type of

structure leads to lower motivation of individuals and limits the organization to have a

360 view of its business and performance. However, the upside of Mechanistic

structure is that it provides stability to organizations operating globally with HQ in its

home country. Decision and Power within its HQ and communication flowing

downwards will tend to maximize efficiency and minimize costs

For example, McDonalds has a famously bureaucratic structure where employee

jobs are highly formalized, with clear lines of communication and specific job

descriptions. This structure is an advantage for them because it allows McDonalds

to produce a uniform product around the world at minimum cost. iv Mechanistic

structures can also be advantageous when entering into new market, which lack

structure, role ambiguity, and uncertainty. The presence of a mechanistic structure

will provide a stable structure in new market and allow operations to start-up

efficiently.

In contrast to mechanistic structures, organic structures are flexible and

decentralized. Organic structure allows broader employee job description and

encourages individual initiative to perform task beneficial to the organization. The

communication lines in this structure are more fluid and flexible.


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Organic structures tend to be contributing to higher levels of job satisfaction in

employees. This structure is conducive to entrepreneurial behaviour and encourages

innovativeness.

An example of a company that has an organic structure is the diversified technology

company 3M. The company is strongly committed to decentralization. At 3M, there

are close to 100 profit centres, with each division feeling like a small company. Each

division manager acts autonomously and is accountable for his or her actions. As

operations within each division get too big and a product created by a division

becomes profitable, the operation is spun off to create a separate business unit. This

is done to protect the agility of the company and the small-company atmosphere.v

Building a Global Integrated workforce with 7 key capabilities

To help Toyota transform its management and better manage its global workforce.

We will need to look at the organizational structure in 7 key areas.

1. Understanding the demographics and capabilities of the workforce

We need to consider the various age group, gender, culture and social needs of the

workforce. The average age of workforce will increase as baby boom generation

nears retirement age and the numbers of younger workers are insufficient to fill the

gap.vi Organizations need align job type, structure and benefits to address the aging

workforce, while leveraging on valuable knowledge of these workforce.

Organizations need create flexible work hours and mentoring opportunities to theyounger workforce achieving knowledge transfer and lowering attrition. The public

recognition in the value of aging workforce will increase motivation and well being of

the organization.

2. Predicting future labour supply and demand

To successfully predict future labour supply and demand, the organization must have

clear vision and goals. Human resource function will need to increase its awareness


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of global mortality trends, migration trends, multi-generational social trends and the

proliferation of technologies and its impact to the global workforce to effectively

integrate the organizations vision and goals into indentifying talent requirements and

effectively deploying right resources responding to future labour supply and demand

across the globe.

3. Utilizing social networks to increase the visibility and application of knowledge

across the organization

Leveraging on Technology to integrate ideas, creating virtual teams, bridging

communication gaps and increasing visibility of individual employees globally will

facilitate knowledge sharing, foster stronger relationship and encourage cross-border

collaboration to solve problems faster.

4. Enabling individuals to perform work regardless of location

Communication and Collaboration technologies have made it possible for certain

type of job functions to work across locations, bridging communication gaps through

audio & video conferencing lowering cost and developing stronger relationship. The

increase use of these technologies will allow organizations to follow the sun in their

global operations increasing sustainable productivity.

5. Facilitating collaboration across traditional organizational boundaries

Implementing hybrid structure of Matrix and Organic structure and the use of

technologies will facilitate cross border communication and collaboration. However,

cross cultural differences may impact the collaboration progress. Therefore, it is

critical to orientate cross cultural differences in the integration of corporate culture

and to some extent localize corporate culture catering to deep language and culture

differences minimizing negative impact along the way.

6. Driving the rapid development of skills and capabilities to meet changing

business conditions


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Responding to market trends and competitors transformation, the organization has

to review their talent pool, structure and development plans to ensure its relevancy to

external forces. Developing the right skills and capabilities to meet future demands

and changing business conditions.

7. Evaluating employee performance and providing appropriate feedback. vii

Develop specific balanced scorecard catering to different segment of the business

and operations that integrates a variety of measures of organizational quality and

performance. Break it down further to financial and non-financial measurements to

ensure it is balanced to achieve the vision and goals of the organization.

.viii

Insight

Organizational change is inevitable. Therefore the organization should take

considerable steps to orient change in all levels to minimize resistance, integrating

corporate into different cultures and ease the transformation process. Promoting

change champions in different cultures, leveraging on technology, renewing

processes will ease the change process and fostering closer bonds.


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In short, change management is an important leadership skill that spans the entire

range of P-O-L-C functions.

P-O-L-C framework (figure 1) ix


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References

iAccenture - The journal of high-performance business, 2011 No.2 issue of Outlook -www.accenture.com

ii

Carpenter ISBN - 978-1-4533-0090-9. Carpenter, chapter.07 - principles of managementiii

Carpenter ISBN - 978-1-4533-0090-9. Carpenter, chapter.07 - principles of management

ivCarpenter ISBN - 978-1-4533-0090-9. Carpenter, chapter.07 - principles of management

vCarpenter ISBN - 978-1-4533-0090-9. Carpenter, chapter.07 - principles of management

viLerman, R. I., & Schmidt, S. R. (2006). Trends and challenges for work in the 21st century.Retrieved September 10, 2008, from U.S. Department of Labour Website,http://www.dol.gov/oasam/programs/history/herman/reports/futurework/conference/trends/trendsI.htm.

vii

Transforming the workforce Seven keys to succeeding in a globally integrated world, IBM GlobalBusiness Management, Human Capital Management

viiiCarpenter ISBN - 978-1-4533-0090-9. Carpenter, chapter.15 - principles of management

ixCarpenter, M. A., & Sanders, W. G. (2009). Strategic management(p. 8). Upper Saddle River, NJ:

Pearson/Prentice-Hall.

Erdogan, Berrin., Bauer, Talya., and Carpenter, Mason., Principles of Management. Retrieved Apr 15,2010 from http://www.flatworldknowledge.com/node/28982.

Erdogan, Berrin, Bauer, Talya, , and Mason Carpenter. Principles of Management. 1969 . Flat WorldKnowledge. 15 Apr, 2010

Diagram is taken from http://www.web-books.com/eLibrary/NC/B0/B58/030MB58.html

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