Issue Identification
Discuss About The International Of Commerce And Management.
Employee intends to outperform if there are certain policies adopted by the company for acknowledging the effort of the working personnel (Kwenin et al., 2013, p. 14). Kwenin et al. (2013) stated that these reward policies are important for to reward people fairly, equitably and consistently and comprises of evaluation of the employee remuneration, compensation along with the benefits that the employee will get if they accomplish more than their desired job responsibilities. Frenkel et al. (2012) on the other hand argued that the policies should be developed according to the worker’s cultural beliefs and competencies so that everyone can aim to surpass their ability. Thus, this report will highlight the issue of rewarding system within culture of Indonesia compared to the policies adopted in Australia.
The issue identified in this report is based on that fact that the HR policies for rewarding outstanding performances that is developed for the Australian organization applicable for the New Zealand subsidiary; however, the same policies are not that significant when applied in the Indonesian environment. Thus, the insignificant HR policies negatively impact the team performances and cohesion.
The main objectives of this report is to evaluate the Hofsted 5 dimensions within culture of Australia and Indonesia and to identify the factors that is liable for impacting the team performances and cohesion of Indonesian employees when follow the policies developed for Australian and New Zealand.
This business report evaluates the cultural dimensions identified by Hofstede to explain the issue faced by the Indonesian subsidiary on following the same HR policies for rewarding outstanding performances. This discussion is also followed by the recommendations that addresses this issue and suggest solution based on the issue identified.
The report evaluates the on-line resource for gathering the knowledge of the Hofsted 5 dimensions within culture of Australia and Indonesia. The paper emphasized on the issues raised that is how culture differences of two nations have dissimilar impacts on the same HR policies for rewarding employees of the organization.
Taras et al. (2012) portrays that there is a significant impact of the culture ingrained in society on the perception possessed on the members of that society. This relationship between the values and the perception is based on some cultural dimension that is identified by the theory of Hofstede’s cultural dimensions. This theory highlighted six dimensions for evaluating the cultural differences- small power distance, individualism, masculinity, high uncertainty avoidance, long term orientation and indulgence (Taras et al. 2012, p. 331).
Objectives
Rinne et al. (2012) stated that small power distance highlights the scenario how people of the nation think about the distribution of the power in the institutions and organizations within a country. The score of the Australia for the small power distance is 36 and that of the Indonesia is high that is 78 (Hofstede Insights, 2018, See Appendix, Figure 1). Thus, in Australia efficient hierarchy is established and the managers are always accessible and rely on individual employees for highlighting their expertise. Power is not equally distributed in the Indonesian organizations as power is centralized and the managers always direct the employees regarding the working process and utilization of the resources. Taken for instance, financial rewards in Australian organization comprised of number of factors for the development of pay levels- employer-driven and employee-driven that resembles that upper boundary is set based on which employers will willfully pay an amount to employee and a lower boundary is also set for which employees will be willing to work respectively (Business.tas.gov.au, 2018).
Minkov and Hofstede (2012) depict that individualism shows the degree of interdependence that a society maintains among its members. Whether or not people of the nation prefer to call their effort individually or together as a team is also a major direction in this dimension. The score for the Australian nation for this dimension is 90 that show that Australia has a highly individualist culture and people look for their benefits and the facility they get for their immediate families. On the contrary to the Australian society, Indonesia represents a Collectivist society with a low score of 14 (Hofstede Insights, 2018, See Appendix, Figure 1). In case of the promotions and rewarding system, in Australian nation, the promotion decisions are based on individual merit (Galtress et al., 2012). However, in Indonesia, the ability of the entire team has to be considered. Government of Australia specifies minimum wages for Australian workers in collaboration with Fair Pay Commission and Tasmanian Industrial Commission (Business.tas.gov.au, 2018). Apart from this pay structure varies according to the capabilities of the employees and employer may adopt- job-based pay structure for particular role and responsibilities, person-based pay structure for particular skills or knowledge and is a matter for negotiation between employee and employer and performance-based pay structure for merit-based profit sharing where employer may pay bonuses more than the agreed amount is the department exceed predetermined threshold (Business.tas.gov.au, 2018).
Aim
Aries Susanty et al. (2013) stated that if a society is expressed by greater competition, achievement and success, the society is referred as high muscularity; while, caring for others and quality of life shows the feminism of the nation’s environment. Thus, whether it is desire to be the best or valuing the things that one prefers is the fundamental issue in this dimension for motivating the people (Sabrim 2012, p.203). The Australia has the score of 61 that shows a “Masculine” society and values the successes and achievements for in case of getting more opportunities for collecting the promotional offers. Indonesia on the contrary scores 46 that represent a feminism society and people addresses status and visible symbols of success for bingeing motivation (Hofstede Insights, 2018, See Appendix, Figure 1).
The situation of feel threatened by ambiguous situations and the tendency to avoid these is the main characteristics of the dimension uncertainty avoidance. Australia shows very intermediate position in this dimension with the score 51 (Hofstede Insights, 2018, See Appendix, Figure 1). Indonesia on the other hand represents the score 48 that is considered as low preference for avoiding uncertainty (Hofstede Insights, 2018, See Appendix, Figure 1). Indonesian society prefer to show empathy when they are morally down. Thus, if considering the case of rewarding people, this society focuses more on maintaining work place and relationship harmony (Panggabean et al., 2013, p. 88). Direct communication is more preferred to resolve the conflict rather than familiar route of using a third party intermediary (Minkov & Hofstede, 2014). In Australia, other facilities like fringe benefits and salary sacrificing are given for motivating people to remain in the organization for longer time. The fringe benefit contain using work car for private purpose, payment for employee’s gym membership, reimburses some expenses, offering chap loan to employees and free tickets for entertainment like concert and exhibitions (Business.tas.gov.au, 2018).
This dimension represents maintaining links with the past in order to deal with the challenges of the present and future (Aries Susanty et al., 2013, p. 64). Sohaib and Kang (2014) stated that there are two existential goals for this dimension- normative societies and pragmatic societies. Normative societies maintain time-honored traditions; while, pragmatic societies encourage thrift and efforts. The score of the Australia is 21, which is low and represents a normative culture where they show great respect for traditions but focus on achieving quick results by small propensity to save for the future (Hofstede Insights, 2018, See Appendix, Figure 1). Indonesia score 62 that show that they prefer to store and save the resource for the future and adapt traditions easily to changed conditions showing a pragmatic culture.
Scope
The extent to which the people of the society try to control their impulses and desires is the main objective of the indulgence. The score for Australia for indulgence is 71 that exhibit willingness to enjoying life and having fun and possess optimistic perception and often spend more for fulfilling their desires. Indonesia, on the contrary, scores less as 38 representing a cynicism and pessimism environment (Hofstede Insights, 2018, See Appendix, Figure 1). Spending more for their luxury is wrong in this culture. The informal reward that is given to employees is cash equivalent of $100 per individual and is for giving fun to the employees customized ‘trophy’ item, medal or framed certificate, off-site fun activity participation, coffee for a week, chocolates/edible treats, customized/gourmet hamper and professional association membership (See appendix, Figure 2).
Conclusion
Thus, it can be stated that Australian culture value individual work more than the team work and this is the reason government formulated job-based pay structure, person-based pay structure and performance-based pay structure alongside of the formulation of the minimum wage for the employees in accordance with Fair Pay Commission and Tasmanian Industrial Commission. Fringe benefits are also given to the employees for being a member of the organization. Informal rewards are given to the employee that can provide them entertainment and fun.
Categories like “Best Branch (Team)” and “Best Project Performance” should be formulated. These major criteria should contain the details description of the aspect fulfilling which the reward can be claimed (Nurlaili, 2015). Taken for instance, for Best Branch (Team), the team needs to demonstrate excellent interpersonal skills, high level of productivity, greater level of personal and team accountability, high level of efficiency and demonstrates outstanding results.
According to the Hofstede model, Indonesian people value their family relationships more and thus including rewarding policies like two days vacations for the employee and immediate family members for employee’s outperformance. This will allow the Indonesian people to meet the target and exceed the predetermined goals.
Indonesian people emphasized more on the team work and celebrate the achievement as a team. Thus, the policies should include rewards for the entire team and their members (Woehr et al., 2013). Taken for instance, a free lunch for the top team or sharing their success stories in the company’s auditorium can be included so as to maintain the cohesion of the team.
References
Ansto.gov.au. (2018). [online] Available at: https://www.ansto.gov.au/cs/groups/corporate/documents/document/mdaw/mdyz/~edisp/acs124649.pdf [Accessed 7 May 2018].
Business.tas.gov.au. (2018). [online] Available at: https://www.business.tas.gov.au/__data/assets/pdf_file/0005/119327/Chapter-4-Motivate-Manage-Reward.pdf [Accessed 7 May 2018].
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