Strategic IHRM in Tai Hua Food Industries Pte Ltd
Vietnam is one the communist republic that joined the free market grouping, ASEAN to improve its economy. The Vietnamese socialist market economy embraces an open door policy or ‘doi moi’ policy that has enhanced a massive restructuring of the country’s economy. Tran (2009) holds that Vietnam has reported a significant influx in FDI (Foreign Direct Investment). In the 1990s, the country’s favourable investment laws attracted many foreign companies that opted for joint ventures (Thang & Quang, 2011). Conversely, most of these joint ventures collapsed because of the inadequate legal frameworks, corruption, bureaucracy, and red tape. There was significance evidence of the lack of misunderstanding of Vietnamese culture by the foreigners. Despite these hiccups, many foreign companies have continued to invest in Vietnam through the Joint venture companies.
The Singaporean company has adopted an ethnocentric approach in managing the international business. This is the guiding principle in its HRM practices. Nevertheless, Tai Hua Food Industries Pte Ltd has always adopted relatively flexible human resource practices. Sometimes, the company uses the local managerial staff. Strategically, this company believes that the business can maximize its performance by allowing the local citizens to run. Ghebregiorgis and Karsten (2007) affirmed that the local customers would feel they own the organization. The firm has to focus on developing the global workforce. It has to tailor its human resource management to fit the different cultural environment worldwide. However, the company always make adjustments that will ensure its workforce fit the local context.
Hofstede national cultural dimensions in comparing Singapore, China, and Vietnam
By exploring the Vietnamese culture using the Hofstede framework, it is possible to determine that this culture is about Singaporean and Chinese culture (White, 2015).
Power Distance
The dimension focuses on the aspects of equality, and it deduces that the individuals are never equal. It thus expresses the attitude of culture regarding the inequalities (White, 2015). Vietnam has a power distance dimension index of 70 implying that the Vietnamese accept hierarchical orders. This shows that everyone in the society has a distinct place. In an organization, hierarchy reflects the level of inequalities. Therefore, in Vietnam, centralization is common as the staff expects to work under the instructions of their superiors. Therefore, the managers are benevolent autocrats thus rarely accept any challenge or criticism. Singapore scores about 74 in the power distance index. Since most of the Singaporeans have a Confucian background, they usually use syncretic approaches. The Confucian approach distinguishes the basic relationship depending on the principles. To this effect, the country believes the relationship is complementary and mutual. Like in Vietnam, the power remains centralized (White, 2015). China scores the highest PDI at 80 as this society completely believes in inequalities. The superior-subordinate relationships are always polarized in China. In most cases, people are influenced by formal sanctions and authority.
Individualism
Singapore, China, and Vietnam scores 20 each in this dimension (White, 2015). This implies that the society embraces collectivism. This is evident in the long-term commitment to the members of the society such as family members. Indeed, loyalty overrides other regulations and societal rules. Therefore, everyone takes responsibility for others (Itim, n.d). The managers of this company and subsidiaries understand that offense would cause shame. According to the Hofstede results, employer/employee relationships are based on links, or moral terms and the managers hire and promote workers based on in-group factors. In fact, the management happens within the group.
Organizational Design and Structure
Masculinity
Under this dimension, a society that is driven by competition, success, and achievement score high (Itim, n.d). As showed in Appendix 2, China is a masculine society with a score of 66 thus justifying the society is success-oriented. In fact, many Chinese compromises their leisure and family priorities for work. On the other hand, Singapore scores 48 while Vietnam scores 40. Based on these results, Singapore is a famine society that recognizes the significance of women. Vietnam is the best country, where women have equal opportunities (White, 2015).
Uncertainty Avoidance
This dimension focuses on how the community handles facts. To this effect, Singapore scores the least (8) because the Singaporean comply with the rules due to high PDI. These people value their society than others. The Chinese also scores low at 30 because adherence to the rules and laws seem flexible thus match the aspects of pragmatism (Dissanayake et al., n.d). In most cases, the expatriates from China would be comfortable with ambiguity as exhibited in their language. The same outcome has also befallen the Vietnamese who value their culture but can adopt others.
Long-term Orientation
This dimension shows how people maintain their links with their history, especially when handling the future and present challenges (Dissanayake et al., n.d). The society scores highly thus prefer the pragmatic approach. The Chinese society scores 87 showing that it is a pragmatic culture. The Chinese are pragmatic-oriented because they believe in the truth. They can thus change easily to the dynamic situations or conditions. The Chinese also have a strong propensity to invest and save in achieving outcomes. Singapore scores 72 thus reflecting that the society embraces cultural qualities. These qualities ensure the Singaporean invests. Like the Westerners, the Singaporeans emphasizes virtue. Vietnam scores 57 that shows that the long-term orientation is insignificant. The expatriates must understand these qualities to avoid cultural conflicts.
Current Tai Hua’s HRM Practices of
Recruitment and Selection
Tai Hau values the top talent who can easily grow the business. The company aims at recruiting local Vietnamese to help in restoring confidence among the local customers. After selecting these talents, the organization takes through an orientation program. Based on performance, the firm earmarks the top performers for managerial positions and take them through further development and growth (Thang & Quang, 2011).
Training and Development
Tai Hau values knowledge sharing among the employees around the world. To this effect, the organization believes the HRM programs can help to deliver the best training and development programs. Gross and Weintraub (2005) held that companies invested in recruiting young graduates with leadership and technical skills thus boost its business growth. Upon selecting the graduates, the company sends them to the headquarters for further training (Barber & Pittaway, 2000). After receiving the training program, Tai Hau would dispatch the employees to its subsidiaries to run the business. The company has also initiated an apprenticeship training programs in Singapore. The company ensures that qualified and successfully trained workers receive the Apprenticeship award. The company also trains the workers on different skills including management, leadership and technical. It believes in training and making leaders from Singapore.
Analysis of the training and development process
Performance Appraisal System
Tai Hua remains committed to providing competitive pay options and benefits to the workers. The company has also established the best long-term career development plan of employees. Ballot, Fakhfakh and Taymaz (2006) affirms that the company believes that employees that are properly rewarded remain productive. To this effect, it provides the best reward systems and benefits to motivate the workforce. In the company, the management formulated the performance management scheme based on five perspectives including periodical performance rating, performance-based reward scheme, development of the performance ability, constant performance monitoring, and work planning and expectation setting. In Tai Hua, the workers have to adopt the document relating to plan and review thus confirming how the work is in tandem with the perspectives (Aragón-Sánchez, Barba-Aragon, & Sanz-Valle, 2003). The company’s supervisors guide the employees to develop their objectives and define the procedures to executive the performance based on the review system. According to Pollitt (2010), the employees are allowed to link their personal goals with the organizational goals and values.
Selection and Recruitment
The success of the subsidiary will depend on the talents recruited by the organization. Tai Hua will use the HR policies to identify and select the top talents who can help in managing the organization. According to Thang, Quang, and Buyens (2010), the Vietnamese prefer working for the western companies. Based on this information, Tai Hua will never have trouble in finding difficulties to recruit the best talents. The organization must leverage on these opportunities to get the best workforce who can take over the managerial tasks. Undeniably, today, the country has insufficient managerial talents thus makes a move to hire the managerial expatriates relevant. By transferring, the managerial expatriates to this country would help them in handling the jobs (Vo & Stanton, 2011). The cultural differences are also evident among the Vietnamese. For instance, some local Vietnamese have adopted the western culture while others have remained loyal to the Vietnamese cultures.
Tai Hua will be free to select the individuals who embrace the western culture or have relevant skills to fit in the Western firms. The expatriates should also consider the character and personality of the candidates including culturally aware, strong emotional intelligence, good communication skills, understanding, tolerance, and open-minded (Vo, 2009). By emphasizing these attributes, the company will get individuals who can fit in its culture. These factors ensure the company mitigates or prevents conflicts between the expatriates and the local Vietnamese workforce.
Employee Training and Development
Vietnamese seems to lack relevant training, skills, and development thus making the situation severe. The foreign companies must make appropriate steps to support their operations. The company needs to consider sending its Vietnamese workers to the headquarters for training purposes (Chung & Ho, 2012). As such, the recruits will be acquainted with the Western culture thus understand the HRM practices and organizational culture. The trained workforce will act as the intermediaries between the expatriates and local level workforce. The expatriates should also help in developing or designing the training materials in Vietnam that fit the modern business environment. The local workers should be exposed to extra training materials that encompass English language, marketing, managerial skills, consumer orientation knowledge, cross-cultural communication, and English language. The enlisted issues form part of the Vietnamese weaknesses that affect the foreign investors.
The company needs to allow the local Vietnamese to redesign the training materials. This will ensure that the communication and related assumptions are overcome in the management of the workforce. In these training materials, it would be essential for the expatriates and the local Vietnamese to highlight the differences between the Western culture and Vietnamese culture. Therefore, early understanding of such differences would ensure the company avoids cultural conflicts.
Performance Appraisal System
The performance appraisal system in Vietnam is the most difficult HR practice. In most cases, it has proved impossible for foreign companies to transfer the appraisal aspects directly to fit the context of Vietnamese. For example, many Vietnamese rarely approve the result-oriented performance appraisal system. The expatriates must understand that Vietnamese value relationship building between people (Thang & Quang, 2011). They lack the desire to make things happen. In Singapore, the performance appraisal techniques embrace the performance-oriented mindset. Since the Vietnamese are not exposed to this performance appraisal system, it requires an iterative approach to the implementation. In Tai Hua, the aspect of communicating different practices to the workforce is common. The management has the responsibility to share the rationale with the workers. Nonetheless, these policies are conflicting with the assumptions, culture, and tendency of the Vietnamese (Thomas, Stanton, Bartram, n.d). Honesty, transparency, and willingness to listen will make the company succeed.
Unlike in Singapore and China, in Vietnam, the expatriates should avoid using strict appraisal. The company needs to use a transformation process. The new management should avoid openly criticizing the workforce or conduct the performance appraisal. This will ensure the expatriates consider the local’s emotional status and feelings (Truong & van der Heijden, 2009). However, they will have to persuade the local workforce to adopt the new appraisal system as applied elsewhere. With time, the company will adopt the HRM practices by Vietnamese. According to Bartram, Stanton, and Thomas (2009), the human resource management practices have to embrace open criticism from the local managers. The expatriates should help in developing the local Vietnamese managers so that they can adjust to the new context. Without a doubt, the company will benefit by adopting a trial and error method in achieving the required HRM practices among the Vietnamese managers. With the changing business environment, it is prudent for the subsidiary to adopt flexible performance appraisal.
Conclusion
Based on this article, many human resource management practices as implemented by Singaporean company are transferable to Vietnam. This is because; the Vietnamese have become adaptable to many Western management styles. The HRM practices used by the company have been developed to meet the expectations in multi-cultural settings around the world. Nevertheless, it is essential for the foreign company to consider the local business practices and local culture. In Vietnam, many foreign investors have failed in their ventures due to cultural issues. Therefore, the discussions in this study have provided important information on how the company can enhance the human resource management practitioners and allow them to transfer the practices to Vietnamese successfully and effectively.
References
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