The International Manager

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Personnel Management

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The most valuable asset of any business is its people. Land, buildings, goods, and equipment may dominate a balance sheet, but they do not make a business successful: people do. The best businesses are the ones that have the best people – capable, creative, energetic people. To attract them requires both ingenuity and initiative on the part of employer. But the payoff in productivity is worth it. Staffing your business with the best people should be one of the highest priorities.

Staffing, leading and controlling are important functions of management. The main aim of staffing is to fill and keep filled the positions in the organization structure with competent people. It also involves selecting, hiring, promoting, planning the career, compensating and training.

Many firms have a personnel department with personnel manager directly responsible for coordinating activities of the employees. Yet, whether or not there is a personnel department, all managers are responsible for managing human resources.

In recent years, many companies have expanded globally. They have done this through mergers, joint ventures and co-operation with foreign companies. Because of this globalization trend, many more employees are working abroad in managerial positions or as part of a multicultural team.

Although it is common nowadays for staff to work abroad to gain experience, many people have difficulty adapting to the new culture. The failure rate in US multinationals is estimated to be as high as 30% and it costs US business $3billion a year.

Two topical failures have been described in the journal “Management Today”. The first example concerns a German manager with IBM who took up the position as a product manager in England. He found that at most lunchtimes and especially on Fridays, many members of the staff went to the pub. “I stopped that right away”, he says. “Now they are not allowed off the premises. It did not make me very popular at the time but it is not good for efficiency. There is no way do that in Germany. No way.”

The second example is about an American manager who came to France on management assignment. He was unable to win the trust of his staff although he tried all kinds of ways to do so. He set clear goals, worked longer hours than everybody, participated in all the projects, visited people’s offices and even took employees out to lunch one by one. But nothing seemed to work. This was because the staff believed strongly that the management was trying to exploit them.

The German manager’ mistake was that he hadn’t foreseen the cultural differences. IBM had a firm rule about drinking during working hours. It was not allowed. He didn’t understand that staff in other countries might be more flexible in applying the rule.

The American manager used the ways he was familiar with to gain the staff’s trust. To them, he seemed more interested in getting the job done than in developing personal relationships. By walking around and visiting everyone in their offices, perhaps he gave the impression that he was “checking up” on staff. His managerial approach strengthened their feeling of exploitation.

When managers work in foreign countries, they may find it difficult to understand the behavior of their employees. Moreover, they may find that the techniques which worked at home are not effective in their new workplace.