Q1.

Nam Hoang Duy Duong - 18130560

A Chinese entrepreneur had built Mingxi Bing guan in the mid-1940s, and it was one
of the most famous accommodation providers in the Chongqing region china. Not
long after mid- 1940s, the Communist party has turned it from a commercially
operated guest house to a state owned property. In the following years, the Mingxi
Bing Guan had developed to be a distinguished guest house which occupied mostly
by governments officials and guests.
Before exploring the human resource management practices of MBG before 2008 we
need to understand the culture reflection of China. According to High and Low
context culture theory, China is a high context country where, relationships depend on
trust, build up slowly, and are stable. The human resource practise in this case reflect
clearly this matter, where a supervisor or manager will easy find a job for their
relatives or close friends. With the right relationships, family members or those well
connected could find a job in MBG. For example, there are 14 people from one family
working in housekeeping. The MBG Human Resources Manager, Madame Fung Zhi
was the key connection for placements. If anyone needs a job for a family member,
simply arrange a suitable time to introduce the candidate to the Madame. If your
requested appointment was approved the meeting would take place usually with an
exchange of gifts and frequently a new employment opportunity would result for the
candidate. (I scratch your back you scratch mine, or if you know someone who know
someone practise.)
There are very few advantages of these practises, they are: MBG will never be in
short of staffs because they have only 188 rooms and there are 419 employees
working, and the Guest house rarely hit 65% occupancy. Further, because of the high
context culture, there are very few conflicts between employers because the authority
is centralized so top management made all the decisions and all the employees stay
loyal to them.
There are many disadvantages of these practises, they are:
1/ Lost of talent workers: if someone talented but does not know anyone who works at
MBG applying for a job he or she is more likely to get turn away.
2/ Lost of time and production because everything has its own time. Time is not easily
scheduled; needs of people may interfere with keeping to a set time.
This practises will never be allow in Australia, firstly because according to the
common law accepting a gift in return for a favour consideration of employment is
considering as a brief and the person who accepting the brief will be executed.
Secondly, every job has minimum requirements of qualifications and experience, so
excepting someone for their relationship and not their experiences and qualifications
is not acceptable. Thirdly, accepting someone or rejecting someone not because of
their qualifications and experiences but because of their relationships is a practise
against the social norm of Australia.

Q2. Bradley Zavaglia - 18354919

Entering into 2008, Mingxi Bing Guan was experiencing financial
losses and wished to turn these deficits into profits. For the first time
in history, the regional government appointed the management of
the Guest House to a foreign international company, FG Global
Hotels (FG), as an act of outsourcing partial control of the business
The change in management commenced in November 2008, when
FGs General Manager Peter Mouncey arrived to manage the
modernisation of Mingxi. Three weeks later to this, 9 internationally
experienced professional departmental managers arrived to
complete the new managerial team. The Chongqing government
wished for Mouncey and his team to transform the old, luxury SOE
(State Owned Enterprise) Guesthouse into an establishment capable
of coping with the growing number of international and domestic
individuals visiting the region aswell as increasing pressure from
competitors
Mouncey specifically discovered the need for significant change in
the Guest Houses culture, professionalism, productivity and staff
reward systems.
Due to the strong guanxi-based, very relationship oriented systems
of China, the breaking down of these cultural barriers was always
going to be a difficult task for the newly introduced managerial
team. In an attempt to modernise the Guest House to adapt to everchanging global desires, Mouncey wished to destroy the old section
of the House in order to make way for a new facility incorporating
banquets, conferences, tearooms and a fitness centre. An obstacle
faced by Mouncey however, was how he intended to restructure the
roles and functionalities of existing employees, including possible
retraining, offered redundancies or discontinued services
In order to address these issues, Mouncey needed to build a higher
quality Human Resource team, through the introduction of
terminated contracts being substituted with a 2-month probationary
contact. From this, new management turned their focus to newer
employees as their payout was significantly less than experienced
staff. As well as this, voluntary redundancies were implemented
instantly which led to a lot of confusion among employees, due to
the fact that the Chinese workers had never experienced such
dismissals before. And finally, as a result of the change in
management, some of the communities views on Mingxi were being
affected, resulting in broken connections with existing
arrangements, and conclusively a loss of business from some
consumers.

Q3. Karl Merson - 17958442

The redundancy system put in place by Peter Mouncey was seen to be a clear example
of cultural neglect at the Mingxi Bung Guan. Mouncey identified the problem of
excess in staff at the guest house and therefore knew that if he cut the total number of
staff this would result in lower wages and therefore the financial gain they had been
seeking.
The first step was offering voluntary redundancies which included one week of pay
per year served at the guest house. In turn this had mixed responses with the
employees as this westernised style of business had never been experienced as all staff
were custom to Guanxi, a traditional Chinese system which protected individuals due
to their connections. As a result, many took the Voluntary redundancy as they felt
uncertain about their futures with the new management in place.
For the remaining staff, a 2-month probation period was implemented which saw all
existing contracts to be terminated. This period was introduced to assess the
performance and ability of the staff. Contradicting on his word, Mouncey targeted the
younger employee group first as this was the cheaper option for redundancies not
taking into account their performance or potential. The total number of employees
rapidly decreased from 419 to 255. Again many employees could not understand this
western style which lead to confusion amongst the remaining staff.
It is evident that Mounceys Western approach to redundancy did not fix the Mingxi
Bing Guans overall problem. Although there was excess in staff that needed to be
addressed, by forcing staff out of work without communication and reason put the
guest house in an unstable position. Young staff with potential had been made
redundant and the remaining staff who were made to conform to new conditions
didnt adjust. To be more affective, Mouncey needed to adapt to the culture of his
staff.
Firstly, by taking more time and using different techniques, Mouncey could of
identified the higher skilled workers. This would have allowed him to put them into
the needed positions like HR management or Customer service to help the guest
houses performance and quality. This also would have allowed him to offer more
appropriate redundancies to the lower performing staff and give them reason for this
action with notice. Cultural barriers needed to be addressed. Mouncey should have
hired a local informant that wasnt connected with the staff at the guest house to give
him the right advice and inform him of how to better enforce the staff cuts that needed
to take place. This also would have led to better communication between the two
parties and as a result be able to retain the appropriate staff going forward.

Q4. Jimmy Dang - 17457385

The overview of the situation:
Peter Mouncey negated the pricing and discounts policy without communicating any
of the changes to the external stakeholders which led to various high profile agents
being left dissatisfied by the changes and as a result Mingxi Bing Guan lost their loyal
agents due to Peter Mounceys managerial decision. Ultimately all business
decelerated, profits declined and Peter Mouncey wasnt able to effectively achieve
the set business goals.
The critical outcomes:
A very loyal agent, Ms Sun was denied her 15%loyalty discount due to the drastic
changes that were in motion. Moreover, Ms Sun was also unhappy by the ordeal as
she has been bringing customers to Mingxi for over 15 years, clearly disrespected and
not only having her own but every employees reputation tarnished and as a result lost
face. In addition, it was inevitable these factors would lead to Ms Sun generating a
negative word of mouth which had extended throughout the local community.
Addressing the importance of: loss of face
Does anyone here understand the term face? Or its importance within the
Chinese community?
The term face is as it sounds; within the Chinese culture is held deeply as it
represents an individuals reputation and hierarchy of prestige within their society.
This was made apparent when Ms Sun when she was denied her loyalty discount and
the implications that followed Peter Mounceys actions; emphasising the importance
of upholding face.
- Although in western society Peter Mounceys managerial approach
would have been deemed acceptable whether or not ones reputation
was tarnished. Within the Chinese society, upholding a good reputation
or face is of a significant cultural value within aspects of business,
family and society.
- Once the Chinese organisation feels as though you have made them
lose face, they would take drastic measures and go as far as
cancelling all business deals with the partnering organisation.
Approaches to Change:
To address these changes, several alternative approaches will have to be applied into
Mingxi Bing Guan in order to resolve or improved the position of the organisation.
Mingxi Bing Guan alternatively could incorporate the following:
- Propose an alternate deal instead of eliminating the loyalty discount
- With the proposal of applying an effective means of cultural training to
emigrants
- Exclusively provide alternative offerings to their high profile clients
But a strong permanent method would be to adopt and apply new methods of staffing
such as the polycentric approach. By adopting polycentric staffing; the host country
has an advantage as they will have information on all current market conditions, the
countrys political state, and any laws of operations. The polycentric approach will
also help minimize any communication barriers and cultural challenges that the
organisation may face. Additionally, by adopting this method it enables the
organisation to employ local employees at a much cheaper rate, as there wouldnt be
any relocation expenses or any means of work compensation for working in a foreign
country.

Q5. Christopher Baynie - 18389324

In order to for businesses to facilitate changes in an organisation they must understand
the need for cultural sensitivity. Which can be defined as the ability that enables you
to have a better understanding about people who are different from yourself in
relation to their background, race or ethnicity and ultimately understand how to treat
them in their own community.
Moving on, change is an essential part of life in an organisation and can be crucial to
a businesses health and effectiveness. In order for companies to sustain a healthy and
effective environment they must learn how to manage change in a culturally sensitive
manner. This means managers in the business must; understand cross-cultural literacy,
ensure no ethnocentric behaviour, assist employees with the anxiety of change, adopt
leadership techniques to integrate change in organisations and altering training that is
necessary in the modern world.
In regard to Mingxi Bing Guan, the company wanted a massive change in how it
operated through its; culture, professionalism, productivity and staff reward system.
This method was carried out by retraining employees, offering redundancies and
having employees services discontinued. Peter Mouncey the General Manager
implemented his new strategy by announcing that existing contracts would be
discontinued and all employees were placed on a 2-month contract where they would
be retrained and put on probation with having no sign of what was to come
afterwards. Due to the Guest House being overstaffed Mouncey offered voluntary
redundancies to employees. As nobody had experienced voluntary redundancies,
training or probation periods and what it involved, this resulted in talented young
employees taking redundancies, as they were unsure of their future. Even competitors
started employing talented senior managers and young office staff. Through these
events it is evident that there had been a lack of cultural sensitivity. The company
should have tried reducing misunderstandings through a better explanation in regard
to contracts, redundancies and given a deeper insight to what their future looked like
at the company. Also the company should have tried to deeply understand the Chinese
culture as it is based on the traditional ethical system of long-term orientation. Lastly
altering contracts to suit their tradition in order to maintain a healthy relationship with
employees.

References:
Natalie, H 2015, Cultural neglect at the Mingxi Bing Guan, viewed 18th April 2016
<https://prezi.com/nxpa_weztu21/copy-of-cultural-neglect-at-the-mingxi-bing-guanguest-house/>
Hill, C, Cronk, T & Wickramsekera, R 2014 Global Business Today, 3rd edn,
McGraw-Hill Education Pty Ltd Australia, North Ryde NSW.