Chapter 12

Managing managers in an
Asia–Pacific environment
The development of unique organisational
cultures in multicultural management teams
• Brett, Behfar and Kern note that ‘multicultural teams offer a number of advantages including deep
knowledge of different product markets, culturally sensitive customer service, and 24-hour work
rotations’ (2006). However, issues relating to cultural differences may reduce the effectiveness of a
team. Research has shown that the most successful teams and managers deal with multicultural
challenges in one of four ways: adaptation (acknowledging cultural gaps openly and working around
them), structural intervention (changing the shape or makeup of the team), managerial intervention
(setting norms early or bringing in a higher level manager), and exit (removing a team member when
other options have failed) (Brett, Behfar & Kern 2006). The appropriate strategy to use is one that
best aligns with the particular circumstances.

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The development of unique organisational
cultures in multi-cultural management teams
• Given the worldwide changes in recent times, talent management and succession planning
are critical to ensuring that the competitive advantage of a firm is maintained. In particular,
increased globalisation has raised issues for MNEs in the management of human resources in
their Asian subsidiaries where training requirements differ from the home country (Zheng,
Hyland & Soosay 2007). The Asian financial services sector, for instance, is moving from a
large physical presence in Asia to embrace digital solutions to serve their clients; the move
includes sovereign funds, companies and individual investors. As clients grow more
comfortable with online and digital platforms, digital tools can complement human-delivered
services, thereby changing the makeup of the delivery team to include tech-savvy talent
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The development of unique organisational
cultures in multi-cultural management teams
• Several economies in the Asia–Pacific region, including China, Singapore, Thailand,
Hong Kong and Thailand, are characterised by talent shortages but have unused
potential in the female side of the workforce. Cultural barriers and resistance to
change in many Asian subsidiaries has resulted in senior leaders failing to fully utilise
the talent pool available. This contrasts with the US, where anti-discrimination laws
have encouraged positive discrimination towards women and disadvantaged groups.
Similarly, in Europe, quotas ensure that women are on corporate boards.

Source: Brett, Behfar & Kern 2006

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The development of unique organisational
cultures in multi-cultural management teams
Article: ‘Managing Asia’s wealth boom’

Questions:

1. What actions can the home office of an MNE implement to ensure

that the management of talent includes women and disadvantaged
groups ?

2. What advantages and disadvantages do technological changes offer

human resource management in MNEs?
© Cambridge University Press 2019
Introduction
• People, often described as a labour force, are the key to an organisation’s
success and generally its greatest expense.
• Human resource management (HRM) is therefore critical to the organisation,
both at the home- and host-country levels, and it is essential for the working
of the organisation that management of people is done well.
• The HRM requirements for an MNE are rapidly changing as technology
improves, travel times reduce and the ability for managers to undertake
business globally from anywhere in the world becomes realistic.
• This chapter will examine international HRM (IHRM) from a traditional
perspective as this foundational knowledge is essential to understanding
human resource issues in global contexts, alongside their differing workplace
practices and legal requirements.
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Learning objectives

In reading this chapter, you will learn to:

1. recognise the challenges and issues with international staffing policies

2. appreciate the process for selecting managers for international assignments

3. understand the reward-and-remuneration structures in overseas postings

4. outline the issues and constraints with the role of labour in Asia–Pacific
markets.

© Cambridge University Press 2019

Learning objective 1: Recognise the challenges and
issues with international staffing policies.
• IHRM has many commonalities with domestic HRM such as role analysis, planning for human

resources, and developing and training staff. However, IHRM functions extend to cover the
international requirements of a company, and this global dimension is often complicated to
manage.

• IHRM must consider crucial worldwide issues such as the differences across countries in

compensation policies and performance appraisal systems, differences in legislation for equal
employment, differences in labour union functions, and the diversity of cultures more generally.

• In addition, MNEs must develop managers that have a broad understanding and territorial map

of the company’s geographically dispersed activities.

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Learning objective 2: Appreciate the process for
selecting managers for international assignments.

• The selection process for a global manager is a critical, difficult and must
follow specific criteria.

• The IHRM must carefully design the job description from the MNE’s
perspective and match its requirements with the most suitable applicant.

• An MNE needs a global perspective if it is to survive in the international arena.

• Therefore, given the growing costs of international assignments for many

global organisations, the MNE must carefully weigh appropriate options for
procuring an effective international manager. © Cambridge University Press 2019
Learning objective 3: Understand the reward-and-
remuneration structures in overseas postings.

• Executive salary packages are usually a combination of a base salary,

benefits and incentives which motivate the manager to perform in
alignment with the MNE’s organisational objectives.

• The package may include quantitative and qualitative measures, and

comprise short-term bonuses and long-term gains like shares and options.
International postings are performance managed through staff evaluations
and measurements of improvement across individual and team levels.

© Cambridge University Press 2019

Learning objective 4: Outline the issues and constraints
with the role of labour in Asia-Pacific markets.

• Work prospects are positive in the Asia–Pacific region because of the flow of goods and services,
integration with the global economy, price stability and rule of law.

• High growth has resulted in increased living standards and middle-class prosperity, and IHRM should
manage the workforce of this region by ensuring their practices and processes reflect this cultural
background.

• The goal of IHRM is to facilitate the business capitalising on opportunities worldwide and as they arise.
MNEs need to balance their need for worldwide company standardisation with specific market needs,
and they need to develop human resource tools to support this endeavour.

• Agile human resource operating platforms, balanced leadership ,and consistent technologies and
systems are paramount to effective IHRM governance. © Cambridge University Press 2019
Figure 12.1 Growth creates more employment in services
than in other sectors: the elasticity of employment to
economic growth, by country groups, 1990–2010

Note: Data are disaggregated by sector for

all regions with at least 17 observations out
of the 21 years of data; that is, comparison
with other regions are not possible given
the limited number of observations.

Source: Packard & Nguyen 2014, p. 11, licensed by CC BY 3.0 IGO © Cambridge University Press 2019