Professional Documents
Culture Documents
Global Human Resource Management Casebook
Global Human Resource Management Casebook
Management Casebook
Liza Castro Christiansen, DBA and MBA, is a visiting academic fellow at the
Henley Business School, University of Reading, England. Liza is an external
lecturer at the Copenhagen Business School and a senior lecturer at the Aarhus
Business Academy in Denmark.
Routledge Global Human Resource Management is an important new series that examines human
resources in its global context. The series is organized into three strands: Content and issues in global
human resource management (HRM); specific HR functions in a global context; and comparative HRM.
Authored by some of the worlds leading authorities on HRM, each book in the series aims to give readers
comprehensive, in-depth, and accessible texts that combine essential theory and best practice. Topics
covered include cross-border alliances; global leadership; global legal systems; HRM in Asia, Africa, and
the Americas; industrial relations; and global staffing.
Edited by
James C. Hayton, Michal Biron,
Liza Castro Christiansen, and Brd Kuvaas
First published 2012
by Routledge
711 Third Avenue, New York, NY 10017
Simultaneously published in the UK
by Routledge
2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN
Routledge is an imprint of the Taylor & Francis Group, an informa business
2012 Taylor & Francis
The right of James C. Hayton, Michal Biron, Liza Castro Christiansen, and
Brd Kuvaas to be identified as the authors of the editorial material and, of
the authors for their individual chapters has been asserted in accordance with
sections 77 and 78 of the Copyright, Designs and Patents Act 1988.
All rights reserved. No part of this book may be reprinted or reproduced or
utilized in any form or by any electronic, mechanical, or other means, now
known or hereafter invented, including photocopying and recording, or in
any information storage or retrieval system, without permission in writing
from the publishers.
Trademark notice: Product or corporate names may be trademarks or
registered trademarks, and are used only for identification and explanation
without intent to infringe.
Library of Congress Cataloging in Publication Data
Global human resource management casebook / editors, James C. Hayton ...
[et al.].
p. cm.
Includes index.
1. Personnel managementCase studies. 2. Industrial relations
Case studies. 3. Human capitalManagementCase studies.
I. Hayton, James C.
HF5549.G5388 2011 2011003719
658.3dc22
ISBN: 978-0-415-89370-1 (hbk)
ISBN: 978-0-415-89371-8 (pbk)
ISBN: 978-0-203-80761-3 (ebk)
Typeset in Times New Roman
by HWA Text and Data Management, London
Printed and bound in the United States of America on acid-free paper
by Sheridan Books, Inc.
Contents
Part I
Western Europe 1
1 Belgium: How Innovative Staffing Solutions Can Make a Difference:
The Case of Selecting Blue-Collar Workers for the Port of Antwerp 3
Filip Lievens and Britt De Soete
Part II
Scandinavia 59
6 Denmark: Grundfos Invests in Talent 61
Liza Castro Christiansen
8 Iceland: Merger, Culture, and HRM: The Marel and Stork Case 85
Ingi Runar Edvardsson and Gudrun Berta Danielsdottir
10 Sweden: At the End of the Road: The Process of a Plant Closure 112
Magnus Hansson
Part III
Central and Eastern Europe 125
11 Bulgaria: telerik: HRM in a Bulgarian Software Company 127
Lucia F. Miree and John E. Galletly
Part IV
Mediterranean, Middle East, and Africa 191
16 Cyprus: People Management in Academia: Anna-Maria Harilaous Story 193
Eleni Stavrou
Part V
Asia and Pacific Rim 251
22 China: Performance Management at Shenhua Guohua Electric Power 253
Gong Yaping and Yang Weiguo
Part VI
The Americas 329
29 Canada: Building a Culture of Inclusion at the Royal Bank of Canada:
Strategies for Aboriginal Peoples and Newcomers to Canada 331
Maria Rotundo
31 Costa Rica: Tim Smith and the Central America Investment Institute 356
Brosh M. Teucher
Index 395
Illustrations
Figures
1.1 Screenshot of computerized crane operator simulation 7
3.1 Luxottica HR department worldwide organization 29
5.1 The John Lewis Partnership virtuous circle 46
5.2 HRM in the John Lewis Partnership 48
6.1 The 10 competencies associated with being a Grundfos talent 65
8.1 Marel expected growth 89
8.2 Number of Marel employees 20052009 93
8.3 Prioritizing activities at Marel 96
10.1 Productivity development January 2000March 2003 117
10.2 Productivity development January 2002August 2003 117
10.3 Understanding fluctuation in productivity during the plant closure process 118
11.1 teleriks mission displayed in company lobby 127
11.2 Sales dashboard by telerik 132
11.3 The work environment 133
11.4 Programming in pairs 135
13.1 Total average monthly gross wages and salaries in Polish zoty and US dollars 153
13.2 AIOs organizational structure 156
14.1 Eldorado operationsgeographical overview 165
15.1 Examples of Trimos solutions 177
15.2 Trimos Path to Excellence (annual mottoes) 178
15.3 Trimos complete solutions operations 179
15.4 Trimos regional sales structure in 2009 181
15.5 The number of domestic and foreign employees 182
15.6 Scholarships by area 183
15.7 The pitfalls of the deteriorating construction market 188
15.8 The structure of Trimo Groups total revenues 188
15.9 Total profit of the Trimo Group 188
16.1 Hierarchy of academic positions at Zenon University 194
17.1 Structure of leadership in PIGAMU 205
18.1 Structure of the production unit at Bamco 220
18.2 New structure of the production unit at Bamco 221
19.1 JCHE overall organizational structure 233
19.2 JAU organizational structure 233
22.1 Guohua Power organizational structure 256
22.2 GHEPCs performance management system, operations 258
22.3 Rules for a forced distribution performance management system at GHEPC 259
23.1 Structure of each MostClean business unit 267
Illustrations ix
30.1 S.C. Johnsons Via del Mar plant Operations Department structure
held previously to the Self Managed Teams Implementation 345
30.2 New structure implemented at S.C. Johnsons Via del Mar plant
Operations Department 347
30.3 Parallel structures developed at the S.C. Johnsons Via del Mar plant in
order to implement Self Management Teams in its production processes 349
30.4 Key findings of the SWOT analysis conducted by the
Implementation Committee 350
Tables
0.1 Cases and topics xxiv
2.1 Macroeconomic effects of the global economic and financial crisis 13
3.1 Italian plants of Luxxotica 26
7.1 Diversity management implementation tools used in Petrocom Finland 77
8.1 HRM practices in firms in Britain, Denmark, the Netherlands, and Iceland
in 2003 91
14.1 Evolution of monthly salaries in Russia (EUR) 167
14.2 Culturally endorsed leadership styles in four countries 170
14.3 Responsibilities of outlet managers and supervisors 172
14.4 Components of the comprehensive assessment procedure 173
25.1 Employee composition at XYZ Company (Indonesia) based on position levels 290
32.1 Novo Nordisks Values 372
32.2 Configuration of High-Performance Human Resource Practices according
to Bamberger and Meshoulam 373
32.3 Configuration of High-Performance HR Practices in Novo Nordisk Mexico 377
Contributors
the area of leadership and HRM. Additional research interests include team
effectiveness, trust, and employees proactive and innovative work behavior.
She has published her work in leading journals, including Journal of Applied
Psychology, Journal of Organizational Behavior, Human Relations, and
Leadership Quarterly and serves on several editorial boards. She represents
the Netherlands in the Academy of Management HR Divisions Ambassadors
Program.
Dr. Graham Dietz is a lecturer in human resource management and organizational
behavior at Durham Business School, Durham University, England. He
completed his PhD on workplace partnership arrangements at the London
School of Economics in 2002 and has published research and commentary on
trust and trust repair, HRM and performance, and joint consultative committees
in leading academic journals, including Academy of Management Review,
International Journal of Human Resource Management, Human Resource
Management Journal,and the International Small Business Journal.He is co-
editor of a book on Organizational Trust: A Cultural Perspective (Cambridge
University Press, 2010).He has undertaken consultancy work for leading multi-
nationals on trust and HRM.
Anders Dysvik is associate professor of organizational psychology in the
Department of Leadership and OrganizationalManagement, Norwegian
School of Management in Oslo.He received his PhD from the Norwegian
School of Management. His research interests include HRM (e.g., training and
development, performance management, investment in employee development,
temporary employment) and organizational behavior (e.g., work motivation,
stressors,supervisor support, turnover, knowledge sharing). His work has been
accepted for publication in journals such as Journal of Vocational Behavior,
International Journal of Human Resource Management, Human Resource
Management Journal,Personnel Review, and European Journal of Work and
Organizational Psychology.
Ingi Runar Edvardsson is a professor in management in the Faculty of
Business Administration at the University of Akureyri. He received his PhD in
sociology from the University of Lund, Sweden. His research and publication
include: knowledge and human resource management, outsourcing, regional
universities, and Nordic labour markets. He has presented his research at several
international conferences, including Decowe: Development of Competencies
in the World of Work and Education, International Labour Process conference,
and IFKAD: International Forum on Knowledge Asset Dynamics. His articles
appeared in Employee Relations, Knowledge Management Research & Practice,
International Journal of Technology Marketing, and International Journal of
Knowledge-Based Organizations. He also published several book chapters.
Marion Festing is professor of human resource management and intercultural
leadership at ESCP Europe in Berlin. She has gained educational, research and
work experience in France, Australia, Tunisia, Taiwan, and the United States.
Her main field of research is international human resource management. In
a three-continental team together with Peter Dowling (Australia) and Allen
Engle (USA), she has published a textbook on International Human Resource
Management (5th ed. London: 2008). Marion Festing is the co-editor of the
German Journal of Research in Human Resource Management and a member
Contributors xiii
Ministry, Finance Ministry, EU, and World Bank. He has published widely in
premier Chinese journals.
Dr. Laura Zapata-Cant (doctor of Universitat Autonoma de Barcelona) is
associate professor of organizational learning and business consulting at
Tecnolgico de Monterrey (Mexico). Dr. Zapata holds the research chair
in European studies. Among her main research interests are knowledge
management in small and medium enterprises, intellectual capital, and
organizational learning. She has presented her research work at international
conferences and has several publications in international journals such as
International Journal of Manpower, Estudios de Administracin (Universidad
de Chile), European Journal of International Management, and Journal of
Knowledge Management. Since 2006, she has been a member of Mexicos
National Researchers System.
Dr. David B. Zoogah earned his PhD in HRM and organizational behavior from
the Ohio State University, Columbus, OH, United States. He teaches HRM
and organizational behavior at Morgan State University, Baltimore, MD,
United States. His research interests center on HRM (employee development,
mentoring, team diversity, green management); leadership (ineffectual,
strategic, and followership); strategic alliance management (teams, personality);
and management in Africa. He has published in the Journal of Applied
Psychology, Journal of Organizational and Occupational Psychology, Asia
Pacific Journal of Management, International Journal of Human Resources
Management, and International Journal of Cross-Cultural Management.
Foreword
Global HRM is a series of books edited and authored by some of the best and
most well-known researchers in the field of human resource management (HRM).
This Series is aimed at offering students and practitioners accessible, coordinated,
and comprehensive books in global HRM. To be used individually or together,
these books cover the main areas in international and comparative HRM. Taking
an expert look at an increasingly important and complex area of global business,
this is a groundbreaking new Series that answers a real need for useful and
affordable textbooks on global HRM.
Several books in this Series, Global HRM, are devoted to HRM policies and
practices in multinational enterprises. Some books focus on specific areas of global
HRM policies and practices, such as global leadership, global compensation,
global staffing, and global labor relations. Other books address special topics that
arise in multinational enterprises such as managing HR in cross-border alliances,
developing strategies and structures, and managing legal systems for multinational
enterprises. This book, Global Human Resource Management Casebook, edited by
James C. Hayton, Michal Biron, Liza Castro Christiansen, and Brd Kuvaas, is a
special one because it is composed of cases based in countries around the world by
authors who are based at universities in those countries. The cases reflect a variety
of HR policies and practices in companies, some multinational and some mostly
local. As with all the books in the Series, the cases utilize the most recent and
classic research and are grounded in what companies around the world are doing
today.
This Routledge series, Global HRM, is intended to serve the growing market
of global scholars and professionals who are seeking a deeper and broader
understanding of the role and importance of HRM in companies as they operate
throughout the world. With this in mind, the books in the Series provide a
thorough review of existing research and numerous examples of companies around
the world. Particularly in the Comparative and the MNE-focused books, company
stories and examples are found throughout the chapters. In addition, many of the
books in the Series include at least one detailed case description that serves as
convenient practical illustration of topics discussed in the book. The Casebook
is unique because it provides global scholars and professionals with detailed
international HRM cases from more than thirty countries.
The publisher and editor also have played a major role in making this Series
possible. Routledge has provided its global production, marketing, and reputation
to make this Series feasible and affordable to academics and practitioners
throughout the world. In addition, Routledge has provided its own highly qualified
professionals to make this Series a reality. In particular, we want to indicate our
deep appreciation for the work of our Series editor John Szilagyi. He has been
very supportive of the Global HRM Series and has been invaluable in providing
the needed support and encouragement to us and to the many authors in the Series.
He, along with Sara Werden and the entire staff, have helped make the process of
completing this Series an enjoyable one. For everything they have done, we thank
them all.
This book is intended for those interested in learning about the international
practice of human resource management (HRM) from case studies of real
companies and real situations. Unsurprisingly, given a particularly strong history
in the United States, a large number of popular HRM-focused case studies
originate from that context. Unfortunately, for those of us teaching HRM outside
of the United States, there are numerous constraints and contingencies that need to
be considered when discussing HRM practice beyond U.S. borders. International
cases can also provide a useful support for those teaching international HRM as
a specific field of study. In addition, international cases are more appealing to an
increasingly international and globally aware student body.
National differences are also in evidence, and a set of thirty-three cases from
around the world does a fine job of highlighting these differences in a comparative
fashion. Differences emerge in large part from two sources: the nature and
trajectory of the economy within which HRM is being practiced and the national
cultural and especially institutional context within which the HRM system
develops. The cases also demonstrate some of the unique problems that emerge
in particular contexts. For example, the challenge of managing and developing a
countrys aboriginal workforce are exemplified in the cases from New Zealand,
Canada, and the United Arab Emirates. The issue of religion, almost a taboo
subject for Anglo Saxon managers, plays a significant role in Indonesia. The cases
are sometimes pleasingly stereotypical (e.g., manufacturing in Germany and Italy;
retail in the United Kingdom) and at other times surprising or novel in terms of
xxiv Preface
The Ambassadors program was the brainchild of John Hollenbeck (Michigan State
University), past chair of the HR Division. The program falls under the remit of
the Divisions International Committee, co-chaired by Steve Werner (University
of Houston) and James Hayton. The editors of this bookJames Hayton, Michal
Biron, Liza Castro Christiansen and Brd Kuvaasare also the members of the
Ambassadors Program Subcommittee. However, the editors reserve the real
acknowledgment for the contributors to the book, our Global HR Ambassadors
and their colleagues, without whom this innovative project would not have been
completed.
James C. Hayton,
Newcastle University Business School
Michal Biron,
University of Haifa
Brd Kuvaas,
BI Norwegian School of Management
Part I
Western Europe
1 Belgium
How Innovative Staffing Solutions
Can Make a Difference: The Case of
Selecting Blue-Collar Workers for the
Port of Antwerp
Filip Lievens and Britt De Soete
Organizational Setting
Thanks to its central location and its large storage and distribution capacity, the
Port of Antwerp, which is situated in the north of Belgium, can be regarded as a
key gateway to Europe. Concerning international maritime transport, Antwerp is
ranked as the second harbor of Europe and the seventh harbor worldwide. The
Port of Antwerp is the European market leader in terms of the transportation of
steel, fruit, forest products, coffee, tobacco, and other products. In 2009, it dealt
with almost 160 million tons of goods. Each year, more than 14,000 seagoing
vessels and 55,000 inland navigation vessels pass through the Port of Antwerp. As
nearly every important European consumption and production center can be easily
reached by train, vessel, or truck from the Port of Antwerp, it is considered to be a
crucial player in the business of international trade.
Since the first Belgian social laws were voted in 1887, there has existed a growing
necessity for Antwerp harbor employers and employees to gather in occupational
associations to facilitate the social bargaining process. The harbor employees
joined trade unions that acted on their members behalf during collective
bargaining and social conflicts. Nowadays, every blue-collar harbor worker in the
Port of Antwerp is obliged to become a union member, as members are not only
represented during the social debate but benefit during the selection process and
the employment phase in the port. The selection process consists of a sequence
of tests and interviews one has to pass to become a blue-collar harbor worker.
However, passing the tests is insufficient to be employed in the port: Each harbor
employee also needs to be handed a registration card, which grants the owner the
official right to perform harbor labor. Applicants interested in the job of harbor
employee in the Port of Antwerp gain from their union membership, as trade
unions control the sequence in which all applicants can participate in the employee
4 Filip Lievens and Britt De Soete
Until now, the responsibilities of the CEPA have been threefold. Most important,
the CEPA represents all harbor employers during the social bargaining process and
during social conflicts. Second, the CEPA is held responsible for the organization
and administration concerning the selection and wage payment of all 9,300
Antwerp blue-collar dock workers. The third task of the CEPA as an umbrella
organization is the daily management of the aforementioned service organizations.
These opposites, together with the shared Belgian historyrather than the shared
Belgian culturehave molded the current relationships between employers and
employees. The Catholic influences and Belgiums pioneer contribution to the
Second Industrial Revolution and its inherent social conflicts have substantially
influenced the formal employment agreement and the psychological contract
between employers and employees. Individual employment agreements are
considered as membership certificates with limited room for negotiation.
Therefore, most Belgian employeesespecially blue-collar workers have
joined trade unions, and changes in employment conditions have been realized
by collective bargaining. The long Belgian tradition of social negotiation and
collective bargaining was created and is currently fostered by the psychological
contract between employers and employees and the accompanying cultural values.
Belgium 5
From the 1990s until October 2004, the CEPA outsourced the entire selection
process for blue-collar harbor workers to a government-owned selection company.
External consultants were responsible for the acquisition of the test battery, which
consisted of an interview and numerous paper-and-pencil tests. The selection tests
were rather old-fashioned, and no feedback reports were provided. The candidates
were external applicants who attended the selection procedure of the Port of
Antwerp with the aim to be selected for a job as dock worker. Twice a week,
Tom Wolters, one of the consultants, visited the Port of Antwerp to communicate
his decisions about the applicants and to provide face-to-face feedback when
candidates explicitly requested it.
In light of this state of affairs, both the candidates applying for a job in the Port
of Antwerp and the associated unions displayed an extremely negative attitude
toward the selection procedure as it was organized in those days. The main critique
expressed dealt with its troublesome job-relatedness, namely its perceived lack
of a connection between the content and format of the selection methods used
on the one hand and the target job on the other hand. This lack of a conceptual
link between the selection procedure and the job led to reduced motivation on the
part of the applicants because they perceived the result of the process as merely
arbitrary instead of being based on a thorough assessment of their abilities. As
the test battery was perceived to be an invalid predictor of job performance,
the selection decision was also often challenged by candidates. Frequently, Mr.
Wolters had to deal with complex and emotional feedback conversations with
rejected candidates. These latter ones received full support of the trade unions,
6 Filip Lievens and Britt De Soete
whereby union representatives often attended the feedback meetings and criticized
the entire selection process. At that point, any glimmer of constructiveness and
effectiveness in the selection and feedback process of the Antwerp blue-collar
harbor workers was a distant future.
In 2004, Sophie Ryan joined the CEPA as the new head of the selection department
of the blue-collar harbor workers. In the past, she had been working as a consultant
in the domain of personnel selection, which had made her aware of the importance
of standardized, up-to-date, and valid selection procedures. Sophies assessment
of the selection situation at the Port of Antwerp revealed that the CEPA was
faced with multiple challenges. First, as the selection battery was questioned and
criticized by applicants, harbor workers, and unions, the reputation of the CEPA
selection procedure was in jeopardy. Second, the low motivation of the applicants
often led to a decline in their test performance. The feedback meetings subsequent
to the testing procedure were frustrating both for the CEPAwhich could not
argue why certain candidates were not short-listed for the job as blue-collar dock
workersand for the candidates, who did not consider their testing results as a
sufficient explanation for their rejection.
In short, Sophie concluded that the Port of Antwerp in general and the CEPA in
particular were challenged to develop a new, job-related, and transparent selection
process. First, the selection procedure had to predict the performance of the
blue-collar harbor workers while taking the current job demands into account.
Belgium 7
Second, it was supposed to elicit positive perceptions among applicants and trade
unions, which in turn should improve the image of the port and its relationships
with the union. Third, it had to be an appealing selection procedure for traditional
(majority) as well as non-traditional (minority) applicant groups.
The Switch
After careful consideration of the possible options, the chairman of the division,
Sophie, and her staff decided to transform the current selection procedure entirely
to meet the aforementioned challenges. The development of a novel selection test
battery consisted of numerous steps. First, an extensive job analysis was conducted
to determine the knowledge, skills, abilities, and other characteristics (KSAOs)
of each blue-collar employee profile. Therefore, interviews were undertaken with
the head and the trainers of the training center, coworkers from the prevention and
protection department, and trade union representatives. These job analyses resulted
in an adaptation of the existing job profiles to the current needs of the harbor and
a list of corresponding KSAOs per profile. The next step consisted of determining
which selection procedures should be included in the selection process based
on the KSAOs to be assessed. The CEPAs aim was to shift from traditional test
methods to a new test battery that consisted of computer-based tests and simulation
exercises.
Although most blue-collar dock workers went through the same selection process,
attention was also paid to the development of specific selection instruments for
specific harbor worker profiles. The crane operator test, a simulation exercise
that was developed to test applicants for the job of crane operator, serves as
a good example. During this exercise, the candidate is placed in a simulated
container crane on a harbor terminal and is subsequently asked to unload an
inland navigation vessel. To do so, each candidate has a computer screen and two
joysticks at his disposal, which serve to present the simulated situation and to
carry out the accompanying tasks respectively. There are two tasks: First of all,
the candidate needs to reach out for the container, and afterward he is expected to
place the container on the dock. While performing this latter task, it is important
that the applicant takes the position of other harbor container transporters into
account and does not obstruct them in their movement. Figure 1.1 presents
the reader with a screenshot of the crane operator test. The crane operator test
measures four different KSAOs: concentration ability (speed-and-accuracy), sense
of responsibility, sense of safety, and stress resilience. An important asset of this
computer test is its ability to assess these KSAOs in an objective way. By using
an automated scoring key that was developed in advance, the subjective element
in the assessment process was reduced. Concentration ability was measured
by the speed by which a candidate was able to work with the spreader (i.e.,
container lifting device). The hindering of other vehicles in the harbor served
as a proxy for the candidates sense of responsibility. The applicants sense of
safety was determined by the number of safety mistakes displayed during the
test, for example, colliding with containers, ships, or other transport vehicles.
Finally, stress resilience was measured by the candidates performance during
test situations with increasing demands (e.g., via the manipulation of time limits).
Since 2005, the crane operator test has been successfully used in the selection
process of Antwerp crane operators.
An important aspect that Sophie took into account while modifying the selection
process was improving and maintaining good long-term relationships between
the CEPA and the trade unions. To develop a personal connection with the trade
unions and to lower the communication threshold, Sophie decided to introduce
herself personally to all harbor union representatives shortly after she joined the
CEPA. To gain union commitment, Sophie presented the plans to adapt the CEPA
selection system and discussed them with the unions already in the earliest stages
Belgium 9
of the switch. As mentioned earlier, the trade unions took part in developing
the new job profiles of blue-collar harbor workers. Although the unions were
strong advocates of changing the traditional testing method, the development of
a new test battery also induced a new perceived threat to a fair selection process.
As Sophie found out during her conversations with union representatives, they
feared that the PC-based nature of the battery required applicants to possess more
computer skills than needed for performing blue-collar worker jobs. Especially
older job applicants feared not being able to perform the tests properly and to be
selected out. Both Sophie and the external consultancy firm took this feedback
into account when developing the new selection battery. It was ensured that
neither computer skills nor a specialized educational background was required to
complete the selection instruments. Finally, to familiarize the unions with the new
selection procedure, trade union representatives were invited to pretest the new
computerized selection instruments.
In the end, not only the selection battery but the accompanying feedback process
was thoroughly adapted. As opposed to the early days, from 2004 every applicant
has been receiving a feedback report. In addition to this written report, each
candidate has been entitled to ask for a face-to-face feedback appointment and has
had the opportunity to look into his or her tests. Every rejected candidate also has
the right to sign up for a retest at an external selection office selected by the CEPA.
The switch from the traditional selection procedure to a modern, job-related, and
computerized version implied numerous direct and indirect advantages for the
Port of Antwerp. Logical consequences resulting from the computerized selection
procedure were faster and more efficient test administration, automatic item
banking, and up-to-date and automatically derived test norms. Apart from these
practical benefits, the use of fancy technological devices in selection also improved
the quality of the ports selection process and the stakeholders perceptions of this
process (Hausknecht, Day, & Thomas, 2004), which all together led to substantial
image improvement of the Port of Antwerp and the CEPA.
One of the most important consequences of the renewed test battery is the
development of a job-related selection process for the blue-collar harbor workers.
As the test development was based on an extensive job analysis and made use
of practical and visual (simulation) exercises, the link between the selection
procedures and the job became evident. As researchers have demonstrated, this
job-relatedness or face validity of a selection instrument serves as an important
determinant of applicant test motivation and test performance (Chan & Schmitt,
1997). Accordingly, simultaneously with the switch toward the new selection
battery, Sophie noticed an increase in motivation at the applicant level. Hence, the
CEPA received considerably fewer complaints concerning the selection process,
which relates to the experienced image improvement of the port among applicants
10 Filip Lievens and Britt De Soete
and other stakeholders. In addition, the feedback meetings went more smoothly
as the rejection of candidates could be objectively argued, thereby increasing
feedback acceptance. Trade unions also notified the enhanced job-relatedness
of the new testing battery and no longer criticized the selection process.
This significantly improved the relationships between unions and the harbor
management and facilitated the social bargaining process at the port.
A last important benefit of the renewed selection process in the Port of Antwerp is
its reduced reading and writing demands and enhanced visual presentation of the
stimulus material. By omitting unnecessary test demands (i.e., test demands that
are not related to the job), the Port of Antwerp has nowadays the chance to enlarge
its applicant pool by targeting non-traditional applicants groups.
Conclusion
Questions
1 In what ways does the Port of Antwerp resemble or differ from your own
national port or large organizations? Is the solution presented applicable in
your country of origin?
Belgium 11
3 What other HR solutions can tackle the problems of the traditional port
selection system?
Note
The authors have permission to publish this case study and to make small factual changes.
For privacy reasons, only fictional names were used.
References
Hausknecht, J. P., Day, D. V., & Thomas, S. C. (2004). Applicant reactions to selection
procedures: An updated model and meta-analysis. Personnel Psychology, 57, 639683.
Sels, L., Janssens, M., Van Den Brande, I., & Overlaet, B. (2000). Belgium: A culture of
compromise. In: Rousseau D., Schalk R. (Eds.), International Psychological Contracts,
4766. Thousand Oaks, CA: Sage.
Zedeck, S. (2009). Adverse impact: History and evolution. In: Outtz, J. (Ed.), Adverse
Impact: Implications for Organizational Staffing and High Stakes Selection, 327. New
York, London: Routledge.
2 Germany
Retaining Talent in Times of Crisis:
Opportunities for the Robert Bosch
Group in the Context of the German
Industrial Relations System
Marion Festing
Organizational Setting
At present, the majority shareholder (92 percent) of the Group is Robert Bosch
Stiftung GmbH, a charitable foundation, which uses the share dividend exclusively
for charitable purposes (e.g., to support medical, international, social, and
educational programs). Robert Bosch GmbH holds only 1 percent of shares and
does not have any voting power. Instead, Robert Bosch Industrietreuhand, a legally
independent unit, has 90 percent of the votes. This entity acts as a kind of board,
which provides strategic advice to Robert Bosch GmbH and ensures compliance
(Robert Bosch Group, 2010a).
Germany 13
Historical Background
The major phenomenon shaping economic activity and employment over the three
years since 2008 has been the global economic and financial crisis. As shown in
Table 2.1, initially driven by the liquidity crisis, the global economy has witnessed
a dramatic recession (OECD, 2009).
Among the industries most severely hit by the crisis was the automotive industry.
Despite the programs introduced by governments throughout the globe to
encourage car purchases, the automotive industry suffered greatly from dramatic
decrease in revenues.
Table 2.1 Macroeconomic effects of the global economic and financial crisis (OECD area,
unless stated otherwise, per cent)
Average 2007 2008 2009 2010
19972006
Real GDP growtha 2.8 2.7 0.6 3.5 1.9
United States 3.2 2.1 0.4 2.5 2.5
Euro area 2.3 2.7 0.5 4.0 0.9
Japan 1.1 2.3 0.7 5.3 1.8
Unemployment rateb 6.5 5.6 5.9 8.2 9.0
Inflation c
3.0 2.3 3.2 0.5 1.3
Fiscal balanced 2.0 1.3 3.5 8.2 8.3
a. Year-on-year increase
b. Percent of labor force
c. Private consumption deflator. Year-on-year increase.
d. Percent of GDP
Source: Based on OECD (2009: 12)
14 Marion Festing
training (Giardini, Kabst, & Mller-Camen, 2005). Collective bargaining and co-
determination at the regional, industry, company, and plant levels are supported
by the regulations at the state level, including the principle of non-interference
of the state in the bargaining process between the employers and the employees
(Tarifautonomie). The regulation of industrial and employment relations extends
to the individual and work contracts level, stipulating the rights of the employed.
Although these German institutions impose considerable constraints on managerial
decisions, important positive effects associated with successful HRM offset these
constraints. Competitive advantages result from the system in the areas of training,
communication, and employment stability. A major positive consequence for
employers is the increased human capital of employees due to training activities
and low turnover rates as compared to other Western European countries.
During the global economic and financial crisis, the positive effects of the highly
institutionalized German labor market environment have also become evident in
connection with the outcomes of the short-time working legislation (Gesetzgebung
zur Kurzarbeit) enforced by the German government. However, the commitment
of the trade unions and works councils to the primary goals of employment
stability, reflected in their cooperative attitude and eagerness to contribute to
solving the crisis together with the employers, has increased the positive effect
of the labor market policy measures. Thus, the effect of the short-time working
schemes enacted at the state level has been significantly accelerated by reducing
working time within the framework of additional collective agreements for
employment security (Tarifvertrag zur Beschftigungssicherung) at the regional
and industrial level and agreements between the employer and works councils on
working time reduction at the company and plant levels.
After many years of prosperous growth, during the financial crisis of 20082009,
Bosch had to report severe losses for the first time since World War II. The three
divisions have performed as follows. In 2009, driven by the steep global vehicle
production slowdown (12 percent compared to 2008 and 17 percent compared to
2007) and the decrease of the North American, Japanese, and European markets,
the sales revenues of the Automotive technology business sector fell by 18
percent to 21.7 billion. Owing to the order backlog, the industrial technology
business sector was significantly affected by the global economic and financial
crisis in the second half of 2009, when the annual sales decreased by 24 percent
and amounted to 5.1 billion. Despite the low economic performance of the other
business sectors owing to the economic and financial crisis, the consumer goods
and building technology business sector could not maintain comparably stable
revenues in 2009.
personnel costs. This generally leads to a situation when the valuable talent pool
developed by long-term development programs is at risk. However, even in times
of crisis, Bosch did not want to lay off well-qualified employees and managers,
and did not want to risk the loss of talent. To reach the goal of cost reduction
without talent loss in all fields, the firm benefited from the German state labor
market policies and the industrial relations system. Here, the interplay of legal
regulations, tariff agreements, agreements with the works council on the firm level,
and individual labor contracts provides for a reduction of working hours and thus a
reduction of labor costs in specific contexts.
The crisis hit the automotive division of Bosch at the end of 2008. In September,
the first discussions with the works council on possible reactions to the crisis took
place. The subject of negotiations was the reduction of working time in accordance
with the decreased production volume. According to the short-time regulations,
companies affected by a significant loss of work can reduce the working time of
their employees, which are in this case provided short-time working allowances
by the state. These allowances amount to 60 percent of the net income loss for
single persons or to 67 percent of the respective net wage cut for employees with
children.
Usually, the firm and the employees agree on short-time work for a period of six
months. It has to be strictly applied for at the beginning of each month. Changes
are subject to short-term notice (i.e., within fourteen days). Other rules can apply
if new production orders arrive. These regulations are an important device for the
company to maintain flexible employment during the crisis. From the employees
perspective, they enable individual workers to plan their time schedule but also
better organize their personal income situation.
16 Marion Festing
The maximum period of short-time work has been tremendously increased by the
German state: It went up from six months initially stipulated by the law to twenty-
four months to support firms in their efforts to keep their talent and to avoid
the massive unemployment observed in other countries. Under respective legal
conditions, a company can repeatedly apply for short-time work but only after an
interval of three months.
Thus, it was important for the company to find alternative ways of reducing
working time without additional financial burden on the employer. The respective
separate regional tariff agreement for employment security allowed for a reduction
of the working time from thirty-five hours to thirty orin some tariff zoneseven
to twenty-nine hours per week. For the company, this option is more attractive as
it allows for decreasing personnel costs almost proportionally to the reduction of
working time.
The collective agreement on employment security stipulates that the working time
reductions should be agreed upon at the site level. The result of the negotiations
between Bosch and the company works council (Gesamtbetriebsrat) in October
2008 was that the first 15 to 20 percent of the working time reduction should be
Germany 17
based on the tariff agreement, and that the rest could be based on the short-time
work legal and additional tariff regulations. At the end of 2008, these regulations
were applied at several locations. Thus, from late 2008when the after effects of
the crisis became even worsevarious groups of employees started with short-
time work. Of course, these measures applied only after the overtime accumulated
on flexible time accounts had been considered.
At the same time, the working time of full-time employees (with forty hours per
week contracts) was reduced from forty to thirty-five hours per week. Overall,
at the end of 2009, 31 percent of the working time of 32,700 employees was
reduced based on the short-time work regulations and tariff agreements. Though
the first target group included production employees, which means those who were
actively involved in the value chain, from 2009, also non-production employees
working in administrative functions and in the headquarters were affected.
By the end of 2009, the crisis was not over. At this point, the differentiation
between structural and economic problems was more important. In this situation,
there was an especially intense ongoing dialogue between the company and the
employee representatives. To maintain the long-term competitiveness and to keep
the core workforce despite the cyclical employment problems, further negotiations
with the company works council were initiated. It was intended to find a solution
in line with the Bosch values. It was agreed in the course of the next round of
negotiations between Bosch and the works council that from April 1, 2010, the
residual costs associated with the short-time work should be reduced as much
as possible, and the respective adjustments should be as socially acceptable as
possible.
The plant in Feuerbach had already encountered economic problems before the
crisis started. There was a plan on how many employees needed to be made
redundant each year to regain competitiveness. Altogether, there are about 12,000
employees in Feuerbach. About 50 percent belong to the automotive division; the
remaining employees are spread between administrative functions (3,000) and
other product divisions.
As a first reaction to the crisis, all external contract workers were dismissed. In this
plant, short-time work started at the end of 2008 based on a mixture of tariff and
legal regulations. On an optional basis, employees were offered a severance option
with a quite attractive financial package. This option could result in the reduction
of 300 employees. From the end of 2009, short-time work regulations were for the
first time applied to non-production employees. The additional payments for the
remaining employees were reduced, starting from 2010, in relation to the actual
volume of short-time work. In 2009, there were reduced bonus payments and no
salary increases for management employees. Therefore, the costs incurred due