@prefix vivo: . @prefix edm: . @prefix ns0: . @prefix dcterms: . @prefix dc: . @prefix skos: . vivo:departmentOrSchool "Graduate and Postdoctoral Studies"@en ; edm:dataProvider "DSpace"@en ; ns0:degreeCampus "UBCV"@en ; dcterms:creator "Cyr, Dianne J."@en ; dcterms:issued "2008-09-15T21:18:55Z"@en, "1993"@en ; vivo:relatedDegree "Doctor of Philosophy - PhD"@en ; ns0:degreeGrantor "University of British Columbia"@en ; dcterms:description "International joint ventures are frequently a response to external pressures placed on globally-oriented companies if they are to survive and compete successfully. Within the international context, a critical element to corporate competitiveness is the effective management of human resources. Despite this reality, very little research to date examines the strategic Human Resource Management (HRM) dimension in international joint ventures. In this investigation, strategic HRM refers to communication systems, staffing, reward and recognition, training, and performance appraisal systems which operate within four successful joint venture (JV) firms. All joint ventures have been formed between two international partners, each from a different national culture. Three of the companies are 50/50 ownership arrangements, while the fourth venture has a 60/40 ownership split between the partners. All four ventures are in the manufacturing sector, although indifferent market niches. In each case, managers in the joint ventures focus on total quality management and high employee involvement in order to enhance product quality and innovation, and to create a more satisfying environment in which employees can contribute to the organization. Collectively, these joint ventures provide an interesting window through which to view strategic HRM operations. In addition to the description of Human Resource policy and practice, the research pursues an understanding of the more evasive questions as to how and why HRM operates as it does. Issues which evolved from the research and are important to a fuller comprehension of HRM in international joint ventures include, among others: the management of the JV-parent relationship; how HRM policy and practice supports or limits parent and JV strategic objectives; the select influence which national culture has on HRM; how corporate culture develops in the JV related to parent influences and JV managerial contributions; and finally, how organizational learning operates at both strategic and tactical levels in each venture."@en ; edm:aggregatedCHO "https://circle.library.ubc.ca/rest/handle/2429/1989?expand=metadata"@en ; dcterms:extent "20793491 bytes"@en ; dc:format "application/pdf"@en ; skos:note "We accept this thesis as conformingINTERNATIONAL JOINT VENTURES:THE STRATEGIC HUMAN RESOURCE MANAGEMENT DIMENSIONbyDianne J. CyrB.A., The University of Victoria, 1973M.A., The University of New Brunswick, 1977A THESIS SUBMITTED IN PARTIAL FULFILLMENT OFTHE REQUIREMENTS FOR THE DEGREE OFDOCTOR OF PHILOSOPHYinTHE FACULTY OF GRADUATE STUDIESInterdisciplinary Studies[Organizational Behavior, Counselling Psychology, Sociology]THE UNIVERSITY OF BRITISH COLUMBIANovember 1992copyright Dianne J. Cyr, 1992In presenting this thesis in partial fulfilment of the requirements for an advanceddegree at the University of British Columbia, I agree that the Library shall make itfreely available for reference and study. I further agree that permission for extensivecopying of this thesis for scholarly purposes may be granted by the head of mydepartment or by his or her representatives. It is understood that copying orpublication of this thesis for financial gain shall not be allowed without my writtenpermission.(Signature)Department of ed-Y-X.-•y)%1A/C-1-\"The University of British ColumbiaVancouver, CanadaDate /3 ep.^.4A.A7 199-3 DE-6 (2/88)iiABSTRACTInternational joint ventures are frequently a response to externalpressures placed on globally-oriented companies if they are tosurvive and compete successfully. Within the internationalcontext, a critical element to corporate competitiveness is theeffective management of human resources. Despite this reality,very little research to date examines the strategic Human ResourceManagement (HRM) dimension in international joint ventures. Inthis investigation, strategic HRM refers to communication systems,staffing, reward and recognition, training, and performanceappraisal systems which operate within four successful jointventure (JV) firms. All joint ventures have been formed betweentwo international partners, each from a different national culture.Three of the companies are 50/50 ownership arrangements, while thefourth venture has a 60/40 ownership split between the partners.All four ventures are in the manufacturing sector, although indifferent market niches. In each case, managers in the jointventures focus on total quality management and high employeeinvolvement in order to enhance product quality and innovation, andto create a more satisfying environment in which employees cancontribute to the organization. Collectively, these joint venturesprovide an interesting window through which to view strategic HRMoperations. In addition to the description of Human Resourcepolicy and practice, the research pursues an understanding of themore evasive questions as to how and why HRM operates as it does.Issues which evolved from the research and are important to a fulleriiicomprehension of HRM in international joint ventures include, amongothers: the management of the JV-parent relationship; how HRMpolicy and practice supports or limits parent and JV strategicobjectives; the select influence which national culture has on HRM;how corporate culture develops in the JV related to parentinfluences and JV managerial contributions; and finally, howorganizational learning operates at both strategic and tacticallevels in each venture.ivTABLE OF CONTENTSABSTRACTACKNOWLEDGEMENTS^ xiiiPART ONE: JOINT VENTURE BACKGROUNDCHAPTER ONE: INTERNATIONAL JOINT VENTURES: THE STRATEGICHUMAN RESOURCE MANAGEMENT DIMENSION^1A. Introductory Summary^ 11. A Focus on International Joint Ventures^ 12. The Role of HRM^ 23. The Purpose of this Research Investigation 44. The Companies 55. Results of the Research Investigation^ 6CHAPTER TWO: A REVIEW OF THE LITERATURE^ 9A. Joint Venturing in an International Setting^ 91. Introduction^ 92. The Form and Functioning of Joint Ventures^123. Management of the Venture^ 134. The JV Board Structure 145. Balancing Stakeholder Interests^ 15B. Human Resource Management^ 171. HRM in Perspective 172. The Dimensions of HRM 18C. HRM in Joint Ventures^ 23D. Issues for Consideration in Joint Venture Firms^291. Corporate Culture^ 292. The Creation of Innovative Organizations^313. National Culture as Context^ 354. National Culture in Organizations^ 375. Joint Ventures as a Case of Socio-cultural Merging^39E. Summary^ 42CHAPTER THREE: RESEARCH METHODOLOGY^ 44A. Research Considerations^ 441. The Research Orientation^ 442. Securing the Companies 45a) The Type of Joint Ventures^ 45b) An Elusive Commodity 46c) The Process for Gaining Entry 483. The Process for the Research 50a) The Format^ 50b) The Role as Researcher^ 524. A Variety of Information 53a) Documentation 53b) On-site Observation 54c) Interviews^ 55d) The Minnesota Job Satisfaction Questionnaire^57e) The Culture Inventory^ 58f) Distribution of the Questionnaires^59g) Guide to Human Resource Management Practices^605. Analysis and Integration of the Data 62PART TWO: THE JOINT VENTURES - INTRODUCTION^ 65CHAPTER FOUR: MAYO FOREST PRODUCTS LIMITED 70A. Joint Venture Background^ 701. History of the Operation 702. Parent Roles^ 723. JV Benefits and Costs^ 76B. Strategic Orientation 781. The Vision^ 782. The Requirements^ 79C. Human Resource Management at Mayo^ 821. The HR Departmental Role 822. Employee Involvement Systems^ 84a) Sources of Information Exchange^ 84b) Shifting Roles for Employees 89c) Employee Opinion of High Performance Systems^933. Reward and Recognition^ 95a) Rewards^ 95b) Recognition 954. Staffing and Promotion 995. Training and Development^ 1016. Performance Appraisal 1027. Employee Opinion^ 1038. Aftermath^ 106viD. Results of the Employee Questionnaires^ 1061. Minnesota Satisfaction Questionnaire 1072. The Culture Inventory^ 1083. Guide to Human Resource Management Practices^112E.^Summary of the Results 114CHAPTER FIVE: OCG MICROELECTRONIC MATERIALS, INC.^117A. Joint Venture Background^ 1171. History of the Venture 1172. Management of the Venture^ 119B. Strategic Orientation^ 1241. The Vision^ 1242. Meeting the Goal 126C. Human Resource Management at OCG^ 1281. The HR Departmental Role 1282. Creating an Integrated Joint Venture^ 132a) Consolidation of CIBA-GEIGY employees intothe Venture^ 132b) Other Integration Issues^ 1383. Communication Strategies 140a) A Format for Information Exchange^140b) Linking International Operations 1434. The Performance Management Process 1445.^Reward and Recognition^ 146a) Rewards^ 146b) Recognition 1486. Staffing and Promotion 149a) Recruitment 149b) Employee Transfers^ 150c) Promotions^ 151d) Qualities of JV Managers^ 1517. Training and Development 153D. Results of the Employee Questionnaires 1541. Minnesota Satisfaction Questionnaire^ 1552. The Culture Inventory^ 1563. Guide to Human Resource Management Practices^156E. Summary of the Results 160viiCHAPTER SIX: OPTIMA CORPORATION^ 163A. Joint Venture Background 1631. History of the Venture^ 1632. Management of the Venture 164B. Strategic Orientation^ 1681. Achievement of the Quality Goal^ 168C. Human Resource Management at Optima 1721. The HR Departmental Role^ 1722. Employee Involvement Systems 176a) A Team Concept 176b) The Creation of New Roles^ 1803. Communication Systems^ 182a) JV-Parent Communications 182b) Communication Within the Venture^1844. Reward and Recognition 188a) Rewards^ 188b) Recognition 1905. Staffing and Promotion^ 193a) The Selection of Managerial Talent^193b) Hiring in the Plants 196c) Career Planning 196d) Job Postings^ 198e) Qualities of JV Managers^ 1996. Employee Transfers Between Optima and the ParentCompanies^ 200a) The Transfer Format 200b) Relocation Policies^ 202c) The Employee Perspective 2057. Training and Development 207a) The Focus for Training 207b) Training in the Plants^ 2088. Performance Appraisal^ 211a) Performance Appraisal for Salaried Employees^211b) Performance Appraisal for Associates^214D. Results of the Employee Questionnaires^ 2151. Minnesota Satisfaction Questionnaire 2152. The Culture Inventory^ 2163. Guide to Human Resource Management Practices^217E. Summary of the Results^ 222CHAPTER SEVEN:^TRIAD MOTORS CORPORATIONA.^Joint Venture Background1. History of the Venture2. Parent Roles3.^Employee Sentiments About the Ventureviii225225225226230B. Strategic Orientation 2331. The Mission 2332. The Requirements 234C. Meshing the Cultures 2371. The Cultural Challenge 2372. Bridging Cross-Cultural Differences 240D. Human Resource Management at Triad 2421. The HR Departmental Role 242a)^Plant Start-Up 242b)^The Development of \"Hybrid\" HR Policy 243c)^Challenges for HRM 2452. Communication Systems 248a) Communication Across Cultures 248b) Networks for Information Exchange 2533. Employee Involvement 256a) Quality Circles and Kaizenb) Employee Sentiments about Involvement256Processes 2574. Union-Management Relations 260a) Mutual Commitments 260b) The Unionization of Triad 262c)^Understanding Employee Preferences 2645. Reward and Recognition 264a) Rewards 264b) Recognition 2666. Staffing and Promotion 267a) An Influence from the Japanese 267b) Associate Selection 269c) Salaried Recruitment 271d) Staff Transfers 273e)^Promotions 2747. Training and Development 275a) The Context for Learning 275b) Multiskilled Capabilities 277c)^Other Training 2788. Performance Appraisal 280a)^The Format 280b)^The Accommodation of Cultural Differences 2819. Employee Opinion 284ixE. Results of the Employee Questionnaires^ 2871. Minnesota Satisfaction Questionnaire 2872. The Culture Inventory^ 2893. Guide to Human Resource Management Practices^290F. Summary of the Results 295PART THREE: CROSS-COMPANY COMPARISONS - INTRODUCTION^299CHAPTER EIGHT: A CROSS-COMPANY ANALYSIS^ 303A. The Joint Venture Form^ 3031. Specialization or Value-Added Ventures^3032. Dominant versus Shared Management Ventures^3053. The JV Management Contract^ 307B. The Strategic Management Orientation 3101. The Joint Venture Objectives^ 3102. Operational Inconsistencies withStated Strategic Objectives 3143. Organizational Outcomes 3154. Reinforcing the JV Mission^ 3165. The Process of Strategic Renewal^ 3176. The Creation of New Roles in the Venture^319C. Subgroups in the Joint Ventures 3221. An Identification of the Subgroups^ 3222. The Ardsley Employees^ 3223. Transferred Employees 3234. Organizational Subunits 325D. Strategic Human Resource Management^ 3261. The Human Resource Management Role 3262. Communication Systems^ 3293. Reward and Recognition 331a) Reward Systems 331b) Recognition 3324. Staffing and Promotion^ 333a) Hiring Practices in the Ventures^ 333b) Staff Transfers 336c) Career Pathing and Promotions 3395. Training and Development^ 340a) Variety in Training Programs^ 340b) Sources of Training 342c) Cultural Training 342d) Job Rotation in Production Facilities^3436. Performance Appraisal^ 343xE. The Questionnaires^ 3451. Guide to Human Resource Management Practices^3452. Minnesota Satisfaction Questionnaire^ 3463. The Culture Inventory^ 347PART FOUR: THE ISSUES: A DISCUSSION - INTRODUCTION^349CHAPTER NINE: STRATEGIC HUMAN RESOURCE MANAGEMENT^349A. Management of the JV-Parent Relationship 3491. Parent Goals and Strategic HRM^ 3492. Partner Compatibility^ 3543. Relationship Management 3554. Implications of the Management Contract^3585. Parameters for Joint Venture Autonomy 363B. Integration of HRM and Strategic Planning 3651. HRM Technique and Process^ 3652. The HR Departmental Role 366a) The Process Experts 366b) Early Involvement 367c) The Establishment of Credibility^368d) Charting New Values and Policy 370e) Resource Requirements^ 373f) Constant Change^ 3743. Communication Systems 374a) Multiple Forms of Communication^ 374b) Communication Across Cultures 377c) Sharing Technical Information 381d) Information Sharing Among JointVenture Subgroups^ 3844. Reward and Recognition 386a) Goals of Reward Systems^ 386b) Multiple Compensation Systems^ 388c) The Creation of Meaningful RecognitionSystems^ 3895. Staffing and Promotion^ 394a) A Focus on High Calibre Staff^ 394b) Transfers to the Venture 397c) Career Pathing and Promotions 4026. Training and Development^ 404a) A Training Emphasis in the Ventures^404b) Cultural Training 406c) Job Rotation in Production Facilities 4097. Performance Appraisal^ 411xiCHAPTER Ten: AN INTEGRATED VIEW OF INTERNATIONALJOINT VENTURE FIRMS - INTRODUCTION^415A. Corporate Culture^ 4171. Parent-based Influence^ 4172. JV-based Influences 4203. A Role for HR Managers 4234. A Process Design for HRM 4275. Questionnaire Outcomes^ 432a) Possible Incompatibility Between Policyand Practice 432b) A Rational Culture Orientation^ 434B. Organizational Learning^ 4361. The Context for Learning^ 4362. Partner Learning 4383. Administrative Learning 4404. Technological Learning 441C. National Culture^ 4431. National Culture and HRM Policy and Practice^4432. Cultural Relativity^ 4443. The Interaction of National Culture, CorporateCulture and Strategic Orientation^ 447D. An Integrative Framework for Strategic HRM inInternational Joint Ventures^ 453E. Research Issues^ 4601. Strengths of the Investigation^ 4602. Limitations of the Investigation 462F. Toward the Future: Some Personal Summary Comments^465REFERENCES^ 468APPENDICES 4781. Letter Sent to Joint Ventures with the AttachedProject Outline^ 4782. Lists of Employees (By Title) Interviewed inEach Joint Venture 4843. Schedule for Descriptive Company Information^4894. Annotated Bibliographies of Company Documents 4915. Participation Consent Form^ 5006. Guideline Questions for HRM Policy and Practice(Versions for HRM and Non-HRM Staff)^ 5027. A Question Guide for the General Manager 5108. Instructions for Audiotape Review 512xii9. Quinn's Typology of Organizational Culture^51410. Employee Consent Form and Questionnaires 51611. Guide to Human Resource Management Practices^52112. An Elaboration of Quality Circles and KaizenProcesses^ 52513. A Summary of the Communication Mechanisms whichOperate in Each JV^ 532LIST OF TABLES1. Human Resource Management Practice Orientations^192. Joint Venture Profiles^ 693. Results from the Minnesota Job SatisfactionQuestionnaire at Mayo Forest Products as AggregatedScores Across All Respondents^ 1104. Results from the Culture Inventory at Mayo ForestProducts as Aggregated Scores Across All Respondents 1115. Results from the Minnesota Job SatisfactionQuestionnaire at OCG Microelectronics as AggregatedScores Across All Respondents^ 1576. Results from the Culture Inventory at OCGMicroelectronics as Aggregated Scores Across AllRespondents^ 1587. Results from the Minnesota Job SatisfactionQuestionnaire at Optima as Aggregated Scores AcrossAll Respondents 2198. Results from the Culture Inventory at Optima asAggregated Scores Across All Respondents^2209. Results from the Minnesota Job SatisfactionQuestionnaire at Triad Motors as Aggregated ScoresAcross All Respondents^ 29110. Results from the Culture Inventory at Triad Motorsas Aggregated Scores Across All Respondents^29211. Central Features of the Joint Ventures 30112. A Process Design for HRM in Joint Ventures 42913. A Framework for Strategic HRM in InternationalJoint Ventures^ 455LIST OF FIGURES1. A Model for IJV Coordination and Process Development 4312. The Relationship between Parent Involvement, NationalCulture, and Similarity of Parent Corporate Cultureand Strategic Orientation^ 4523. Quinn's Typology of Organizational Culture^5154. Quality Circles - The Process 5295. Quality Circle Activity vs. Kaizen Suggestion^531ACKNOWLEDGEMENTSMany people deserve recognition for their contributionsto this investigation. I would like to thank PeterFrost, my research advisor, for his thoughtfulness,encouragement and guidance during the course of thisproject. Helpful comments were also provided by MerleAce, Larry Cochran, and Ken Stoddart who are on thedissertation committee. Evan Evans shared with me hisromance and dedication for research; and he providedvaluable advice which contributed in significant ways tothe development of this investigation. Cheerful andcompetent technical assistance was provided by AndrewLeung. I am grateful to many individuals in the fourjoint ventures in which the research was conducted, fortheir unfailing assistance and insights. In addition, Iappreciate the financial support which helped to defraythe costs involved in this research. Funding for theproject was obtained from a research grant shared withPeter Frost from the University of British Columbia, andfrom the National Centre for Management Research andDevelopment at the University of Western Ontario. Inaddition, the final stages of this project were completedat INSEAD in France, through funding provided from aChateaubriand fellowship from the French government(Centre International des Etudiants et Stagiaires).1PART ONE: JOINT VENTURE BACKGROUNDCHAPTER ONEINTERNATIONAL JOINT VENTURES:THE STRATEGIC HUMAN RESOURCE MANAGEMENT DIMENSIONA. Introductory Summary1. A Focus on International Joint VenturesTo compete in an international business environment, firms areforming strategic alliances as a mechanism for the enhancement ofglobal competitiveness. In recent years, an explosion ofinternational joint venture (IJV) activity signifies this form ofalliance as a popular vehicle for augmenting strategic capability,(Geringer and Woodcock, 1989; Harrigan, 1985; Hergert and Morris,1988; Killing, 1983; Shenkar and Zeira, 1987). Typically, the formand function of joint ventures has not been well defined either inthe academic literature or by company executives. In thisresearch, the term joint venture (JV) refers to a legallyindependent organization which is the product of the partnership oftwo corporations, (the parent firms), each of which participates inthe decision-making activities of the jointly owned company. Morespecifically, in an international joint venture, at least oneparent firm has its headquarters outside the country where thejoint venture is located.International JVs are formed for a variety of reasons.International companies create venture partnerships to gain foreignmarket access, for the acquisition of new technology, to fundcapital requirements beyond the capability of a single firm, and inorder to share risks. Joint ventures are also a vehicle through2which companies can gain broader scale sourcing of materialsrequired for their operations. The possibility exists for both theJV and the parent firms to learn new skills from one another, andto share technology or information as a result of the venture.Many of these elements are essential ingredients for companieswhich aim to compete in an international arena - where competitionis fierce, and where requirements for quality, innovation, andmeeting customer requirements are critical.Although there are clearly potential economic andtechnological benefits which result from firms venturing together,the failure rate of joint ventures is high. For example, in astudy of 880 joint ventures and cooperative alliances, only 45percent of the companies were judged successful by all sponsors(Collins and Doorley, 1991). Some factors which lead to JV failureinclude: significantly different goals of parent firms; perceptionsof unequal costs and benefits; or conflicts over decision-making,managerial processes and corporate values (Dymsza, 1988; Killing,1983). Misunderstanding is most likely when international JVs spandiverse national cultures, and when attitudinal and valuedifferences exist between different groups in the venture (Baird,Lyles and Wharton, 1989). Problems often arise when executives inthe parent companies attempt to impose their standards and policiesfor operation on the joint venture firm.2. The Role of HRMDespite an increase of joint venture activity, research hasgenerally neglected issues related to the development andimplementation of human resource management practice in3international JVs. Nor does the research to date examine contextfactors which determine how and why HRM operates as it does withinvarious joint venture firms. Scholars in the internationalmanagement field are quick to observe that the HRM role, related tothe success or failure of joint ventures, has received littleempirical study (Shenkar and Zeira, 1987; Teagarden and Von Glinow,1989). This omission in the research literature exists even thougheffective HRM practices are thought to be a significantcontributing factor in the successful operation of multinationalcorporations, (Evans, 1986; Laurent, 1986; Pieper, 1990; Punnett,1989; Schein, 1986; Schuler, 1989). Tichy (1988) notes that thekey to success in multinational companies is leadership, and aninnovative set of HRM practices which permit organizationalflexibility and adaptability.HRM managers may potentially function as the \"processexperts\", and help to determine the strategic capability of anorganization through the methods by which staff are selected,appraised, rewarded, and developed (Evans, 1984; Tichy, 1988). HRMis strategic to the extent that HR activities are consistent with,and enhance the business objectives of the organization. StrategicHRM is concerned with interdependencies which exist between companyobjectives and human resource management capability (Evans, 1986;Kossek, 1987; Schuler and Jackson, 1987; Tichy, 1983). In thisvein, HRM staff are proactive and anticipate both present andfuture HR needs in the organization (Meshoulam and Baird, 1987).HRM has the opportunity to foster entrepreneurship or mediocrity(Schuler, 1987). In complex, global companies, HRM is required tobe flexible and innovative (Schuler, 1989) in order to accommodate4diverse business and employee requirements. New forms of HRM whichtranscend uni-dimensional value systems (Evans, 1986, Quinn, 1984),or the perspectives of a single group (Bartlett and Ghoshal, 1989)will be required in international organizations.In the broadest sense of the term, HRM is a system of\"governance\" within the organization (Evans, 1986). HR staff worktogether with managers and other employees in the joint creation ofeffective solutions for how work is to be accomplished. Ineffective companies, HRM as enacted by multiple groups within theorganization, may be concerned with recruitment, reward andrecognition, training and development, performance appraisal, andcommunication systems, among other things. Considering theimportant role for HRM, research needs to more fully address HRM incomplex, international corporations. In particular, the study ofHRM in international joint ventures will help to illuminate how HRMoperates in a context when parent firms with multiple nationalcultures, and multiple corporate orientations, unite.3. The Purpose of this Research InvestigationThe research considers how and why HRM policy and practiceoperate as they do in a sample of successful international jointventure companies. Considering that so little information existson HRM in this context, the research is exploratory, with anemphasis on the description of HR processes, as well as on thedevelopment of some understanding as to the contributing factorswhich affect HRM. Based on the literature to date, one mightexpect, for example, that the national culture and corporateculture of the parent firms may have some bearing on HRM operations5(Datta and Rasheed, 1989; Killing, 1983; Pucik, 1988; Shenkar andZeira, 1987). However, how culture or other factors moderate HRMpolicy and practice in international JVs is far from clear.Further elaboration of both organizational determinants whichaffect how HRM functions, and the outcomes of various HRM policiesand practices deserves further elaboration. In order to gain acomprehensive perspective of HRM in international joint ventures,this research uses a multi-method approach to data collection whichincludes: documentary materials, interviews at multiple levels ineach JV, on-site observation, and questionnaires which measure jobsatisfaction and employee perceptions of the corporate culture asit operates in each venture. This form of in-depth investigationprovides an opportunity for the researcher to better understand thefactors which enable or constrain HRM, and where inconsistenciesexist between HRM policy and the way in which HR practices operatein reality.4. The CompaniesAll four joint ventures in this investigation aremanufacturing operations which share a remarkably similar strategicmanagement orientation, related to what managers in the JV perceivewill lead to successes in a global market. In addition, the HRMfocus which the management of these JVs consider desirable in orderto accomplish strategic goals, is also very similar. All jointventures are located in North America, and are 50/50 equitypartnerships between the parents, except Mayo Forest Products whichhas a 60/40 ownership split. Mayo Forest Products is a smalllumber manufacturing operation between Canadian and Japanese parent6firms. OCG Microelectronics is a relatively new JV, formed inJanuary 1991, and is a partnership between American and Swissparents. The management of the remaining two JVs in this projectprefer that the company names remain anonymous. \"Optima\" is aventure between American and German multinational corporations, andproduces high quality fibre optics. Finally, \"Triad\" is a JVbetween American and Japanese parent firms and manufacturesautomobiles for the American market.Of interest, all four joint ventures have been recognized byexternal sources for standards of product and service excellence(i.e. customer reports; awards for technological expertise). Inaddition, on a job satisfaction questionnaire employees in theventures indicate a relatively high level of satisfaction relatedto working in each company.5. Results of the Research InvestigationThe investigation provides a rich background of how HRMoperates in four joint venture companies. Related to themanagement of the JV-parent relationship, the reason for formationof the venture, level of partner compatibility, and which parenthas the management contract contributes to how strategic HRMoperates. The joint venture objectives, both as defined by theparents, and implemented by various managers in the JV, likewisehave implications for the development of strategic HRM policy andpractice. Perhaps not surprising in competitive firms which seekto compete in a global market, all JVs in this research have aremarkably similar strategic orientation which focuses on highquality and low costs. Subsequently, the HRM practices in each JV7to meet these goals are likewise very similar. Communication,training, staffing, and reward and recognition for employeeachievements are all priorities in these ventures related to theattainment of strategic objectives. In all the JVs, performanceappraisal appeared to be a less significant consideration.To remain competitive, all four ventures have a focus onorganizational learning and strategic renewal. In this researchlearning refers to the creation of new ideologies and systems atthe organizational level. More specifically, learning occurs:1. between the parents and between the parents and JV related tochanging expectations and objectives; 2. related to administrativechanges in policy and practice to keep pace with evolving strategicrequirements; and^3. at a technological level.^Various HRpractices operate to facilitate learning both in the JV, andrelated to the transfer of information and technology between theJV and the parents.In addition, the development of corporate culture in theventures is of interest, and is related to the strategicorientation of the JV, as well as to elements of national culture.In the joint ventures in this investigation, corporate culturedeveloped in relation to parent influences on the JV, as well asrelated to the contributions of JV staff to create a unique set ofnorms and values to suit the specific venture requirements. SelectHRM policies and practices have contributed to how employees in thejoint ventures experience the JV corporate culture.National culture has a definite presence in Triad, but is lessstrongly felt by employees in the other ventures. As managers atTriad note, almost everything they do is related to the combination8of diverse American and Japanese cultures in the plant. As aconsequence, in the area of HRM, managers have attempted to create\"hybrid\" HR policy which takes into account the national culturalvalues, norms, and operating contingencies of each group. Theresult has been the establishment of unique forms of HR policy forthe multicultural needs of the venture. 11 For the reader who wishes an overview of the key points inthis investigation refer to: the summary for each joint venturewhich appears at the end of each company section in \"The Companies\"portion of the manuscript; Table 11 in the section \"A Cross-CompanyAnalysis\"; and \"A Summary of the Major Themes from thisInvestigation\".9CHAPTER TWOA REVIEW OF THE LITERATUREA. Joint Venturing in an International Setting1. IntroductionThe complexion of businesses and organizations as we haveknown them for decades is rapidly being altered. More and more,large multinational companies seek to expand to new markets, arequick to require technology found in other firms, and recognizeintense pressure to compete for the rewards of global expansion.Based on the outcome of a seminar on global issues held in 1990, adefinition of globalization related to how organizations operate isoutlined by Barnett (1990:7-8),Globalization is the integration of business activitiesacross geographical and organizational boundaries. It isthe freedom to conceive, design, buy, produce,distribute, and sell products and services in a mannerwhich offers maximum benefit to the firm without regardto the consequences for individual geographic locationsor organizational units. There is no presumption thatcertain activities must be located in certain places orthat existing organizational boundaries areinviolable...The global firm is not constrained bynational boundaries as it searches for ideas, talent,capital, and other resources required for its success.International joint ventures are one vehicle for theaccomplishment of global corporate goals. In conjunction withinternational demands, new solutions of how to do business areeagerly sought in all forms of multinational companies. Recentbooks and articles expound on the multinational mission, (Beamish,1988; Egelhoff, 1988; Hedlund, 1986; Leontides, 1985; Prahalad andDoz, 1987); search for transnational solutions for the managementof enterprises which span multiple national borders; (Bartlett and10Ghoshal, 1989); and begin to probe complex control and humanresource issues which exist in firms when multiple national groupsare present (Pucik and Katz, 1986; Doz and Prahalad, 1986).Although the literature has begun to address some of theseimportant issues, relatively little investigation has been devotedto HRM in international joint ventures. This is the case despitethe importance of HRM to the success and viability of a company(Evans, 1986; Pieper, 1990; Schuler, 1989; Walker, 1989; Tichy,1988). Related to a role for HRM, Likert (1967:1) states,Every aspect of a firms's activities is determined by thecompetence, motivation, and general effectiveness of itshuman organization. Of all the tasks of management,managing the human component is the central and mostimportant task, because all else depends upon how well itis done.In the context of joint ventures more specifically, HRM cancontribute to the achievement of organizational goals related tostaffing, promotion, employee loyalty, decision-making andcompensation, for example (Cascio and Serapio, 1991; Pucik, 1988;Shenkar and Zeira, 1987). Further, effective HRM policy mightserve to bridge discrepancies when diverse social or culturalsystems combine (Baird, Lyles, and Wharton, 1989; Teagarden and VonGlinow, 1989). In addition, learning and experimentation in theorganization may be enhanced through HRM policy and practice(Bartlett, Doz and Hedlund, 1990; Parkhe, 1991). Technologytransfer can be orchestrated related to transfer, training andreward policies (Collins and Doorley, 1991).Despite evidence to suggest that executives and other membersin an organization are well advised to focus on HRM in theirinternational operations, HRM issues still receive minimal11attention. Frayne and Geringer (1989) note that \"of the 100 to5,000 hours typically involved in creating IJVs, only about 4% ofthe time has been spent resolving human resource issues\".In international operations, there are special requirementsfor the coordination of activities, including HRM, across companyboundaries. In particular, an understanding of intercompanyrelationships is important. According to Harrigan (1985:40), \"themissing link in understanding joint strategies is analysis ofdynamic interaction of the three key actors\", (i.e. between theparent firms and the JV). Considering company interrelationships,Ohmae (1990:136) observes,To my knowledge, however, not one scholar specializes inthe study of intercompany [his emphasis] relationships.This is a serious omission, given the importance of jointventures and alliances in today's global environment. Weneed to know much more than we do about what makeseffective corporate relationships work...We mustrecognize and accept the inescapable subtelties anddifficulties of intercompany relationships. That is theessential starting point. Then we must focus not oncontractual or equity-related issues, but on the qualityof the people at the interface between organizations.Finally, we must understand that success requiresfrequent, rapport-building meetings on at least threeorganizational levels: top management, staff, and linemanagement at the working level.With these considerations in mind, this research examines HRMas a component of both intercompany relationships between the JVand the parents, as well as how HRM operates within the venture.Related to a requirement to investigate HRM in internationalventures, the background for this research is elaborated in thefollowing sections in which literature relevant to this topic isreviewed. Select issues concerning international joint venturesand HRM are considered. In addition, there is some indication thatnational and corporate culture, degrees of flexibility in the12organization, and managerial expertise are likely to relate to howHRM operates in international JVs. These areas are brieflyelaborated, as well as the implications of organizational learningin the venture related to how HR policy and practice operates.2. The Form and Functioning of Joint VenturesInternational joint ventures represent a unique form of theglobally oriented corporation. The number of international JVswhich are formed is rapidly increasing, with the greatest incidenceof collaborative agreements between two partners (Hergert andMorris, 1988). Depending on the requirements of the JV, thepartners may have differing roles or functions. Lei and Slocum(1991) describe ventures which are either \"specialized\" or \"value-added\". In specialization ventures, each partner contributesspecific expertise to the operation. For example, one partner inthe JV may manufacture the product, while the other partner doesthe marketing. In a value-added venture, the partners share in thecreation of product value in the venture. In this instance, the JVpartners might jointly design and manufacture a product, drawing onsynergistic capabilities of the staff in both parent organizations.Within the two partner venture, Killing (1983) describes threelevels of management involvement or control by the partners:dominant parent JVs, shared management ventures, or independentventures. The dominant parent JV is closest to the idea of awholly-owned subsidiary, and one parent has primary managementresponsibility for the venture. In a shared management JV, bothparents have a meaningful role, and provide input as to how theventure operates. In independent JVs, the venture is relatively13free of interference from either parent, and the JV General Manageris often given responsibility for decisions which affect theventure.3. Management of the VentureThe management of joint ventures is a complex process. Ifparent firms decide that a joint venture is required to accomplishdesired strategic goals, then the partners must be prepared to dealwith difficult issues related to joint ownership and jointdecision-making in the venture. Collins and Doorley (1991) observethat in successful JVs, much advance planning is required, and theventure is likely to be championed by senior executives in theparent firms. The venture plan will ideally consider marketoptions, business strategy, resource requirements, funding - allrelated to partner compatibility. Collins and Doorley elaboratethat company style and corporate culture should be a \"majorconsideration\" as to whether two parent firms are able toeffectively join together in a joint venture operation. Differentgoals, perceptions and values of parent firms may result incorporate disharmony, and frequently to the failure of the venture(Dymza, 1988; Killing, 1983). For example, do prospective JVpartners have similar operating styles related to decision-makingand HR management? Is there partner compatibility related to thelevel of employee participation desired in the JV? To avoidmisunderstanding between the partners, these issues might beaddressed in early JV negotiations, before the actual start-up ofthe venture.In addition to planning for the venture, Collins and Doorley14(1991) suggest other criteria which will enhance the success ofvarious forms of strategic alliances. These \"golden rules\" ofpartnership success include:• a balance of trust and self-interest• anticipation of conflicts• clear definition of strategic leadership• flexibility• acceptance of cultural differences at both the level ofnational culture and corporate culture• orchestration of technology transfer• learning from the partner's strengthsTaken together, the preceding points offer some guidelines forfurther research on how the the relationship between joint venturepartners might be managed.4. The JV Board StructureMost joint ventures have a dual-board structure which includesa formal Board of Directors, which is usually comprised of seniorrepresentatives of both parent firms; and an advisory committee,which is often the operating group for the venture. Generally, theBoard of Directors is concerned with the ongoing success of theventure, as well as the protection of parent interests. The Boardtypically approves the annual operating plan, reviews budgets, andapproves major capital expenditures. According to Collins andDoorley (1991), in a 50/50 JV the Board would have equalrepresentation from each of the parents. Members of the board arechosen to \"reflect the main contributions of each parent\". TheGeneral Manager of the venture will often sit on the Board, but may15not always have full voting rights. In contrast, the advisorycommittee is comprised of senior managers in the venture, and isactive in the day-to-day operation of the company. The advisorycommittee informs the Board of Directors of key issues forconsideration when Board approval is required.5. Balancing Stakeholder InterestsIn early venture negotiations, the parents need to decide whohas management responsibility for the venture, in which specificareas, and how key positions in the venture are to be staffed. Inaddition, the level of autonomy and decision-making responsibilityallocated to JV managers (as opposed to parent managers), must bedecided. For the venture to achieve maximal results, members ofboth the JV and parent organizations will work toward the successof the venture. Lorange and Roos (1992; 1991) point out that thereare two political considerations in strategic alliances. Theseinclude:• Stakeholder Blessing - Are both internal (i.e. JV) andexternal (i.e. parent) interest groups convinced that theventure is desirable?• Internal Support - Are a broad range of employees in theventure convinced that the venture is viable? Are theycommitted and able to further the JV goals?Related to internal support, if managers and other groups in theventure view the JV as threatening to their careers or personalgoals, then enthusiastic, positive contributions to the venture arelikely to be curtailed.The extent to which HRM or other strategic management16practices are adopted from one parent influences the corporateculture and dominant values present in the venture. For example,Frayne and Geringer (1989) propose that training content, the formof performance appraisal, or type of compensation and reward areexpected to affect the JV corporate identity. If one parent isresponsible for the management contract, including HRM, in theventure, then theoretically that parent is more likely to infusethe venture with its practices, strategic objectives and operatingstyle. Further, dominance by the parents in the venture willaffect the level to which JV autonomy is possible.The development of a corporate identity in the venture islikely to occur under some of the same conditions which operate inwholly owned companies. Various authors (Joiner, 1987; Kanter,1989; Morgan, 1988; Schein, 1986; Walton and Lawrence, 1985)suggest that an integrated corporate identity is most likely when:• there is strong, unified leadership• there is a vision and mission statement for the companywhich is meaningful to employees and continuallyreinforced• communication is open at all levels in the organization• employees are actively involved• HRM practices reinforce company valuesIn joint ventures, evidence of these characteristics may contributeto the development of a unified JV corporate culture which isindependent from that of the parent firms.17B. Human Resource Management1. HRM in PerspectiveThere are multiple roles and demands for HRM in progressiveorganizations. London (1988) describes that HR staff operate asthe roles of educators and developers, innovators, evaluators,leaders, consultants, and futurists. In order to have sufficientpower to fulfill at least some of these roles, HRM staff requireinformation, resources, and support from other groups (Kanter,1988).HR staff are accountable to multiple stakeholders in theorganization (Tsui, 1987), and often may be in the often precariousposition of choosing which group's interests are to be met first.For example, production interests may need to be balanced withemployee concerns related to overtime or time-off policies. Injoint ventures, multiple stakeholders may include not only JVemployees such as supervisors, managers, union representatives, orproduction staff, but also various employees belonging to theparent firms.In recent years, the expectation for HRM is that it isstrategic and linked to the business requirements of the company.This is especially desirable in highly competitive organizations.Walker (1989) elaborates on organizational needs or issues whichwill determine HR roles in the global competitive environment ofthe 1990s. HRM must be responsive to:• the creation of a unified corporate vision• the development of flexible, decentralized organizationalstructures18• the establishment of HR policy which enhances qualityconsciousness• a requirement for increased international learning,including technology transfers• flatter, less bureaucratic organizations• lean staffing• the motivation of a diverse workforce with high personalexpectations• respect for unique differences while seeking commonvalues and approaches.Many of these issues will be dealt with by managers and employeesat all levels in the organization. In some instances staff in theHR department will work with other employees to develop creative,appropriate, enriching HR policies and practices which benefit bothemployees and the organization.2. The Dimensions of HRMConsistent with the literature, five dimensions of HRM will beconsidered in the present research: planning, staffing,performance appraisal, training and reward systems (Schuler, 1986;Schneider, 1988). 2 A list of HRM practices appears in Table 1.2 The description of HR functions has been adapted fromDolan, S.L. and Schuler, R.S. (1987). Personnel and Human Resource Management in Canada. St. Paul: West Publishing Company, and fromSchuler, R.S. and Jackson, S.E. (1986). Managing Stress ThroughPHRM Practice, Research in Personnel and HRM, 4, 183-224.19TABLE 1Human Resource Management Practice OrientationsPlanning^Informal^ Formal^Loose TightShort-term^ Long-termExplicit Analysis Implicit AnalysisNarrow Jobs^ Broad JobsSegmented Design Integrative DesignLow Employee Involvement^ High Employee InvolvementStaffingExternal Sources^ Broad PathsMultiple LadderImplicit CriteriaOpen ProceduresPerformance Appraisal ^Behavioral criteria^ Results CriteriaShort-term Criteria Long-term CriteriaPurposes: Development, Remedial, MaintenanceLow Employee Participation^ High Employee ParticipationIndividual Criteria Group CriteriaReward^Low Base Salaries^ High Base SalariesInternal Equity External EquityFew Perks^ Many PerksStandard, Fixed Package Flexible PackageLow Participation^ High ParticipationNo Incentives Many IncentivesShort-term Incentives^ Long-term IncentivesLittle Employment Security High Employment SecurityHierarchical^ EgalitarianTraining^Short-term^ Long-termNarrow Application Broad ApplicationUnplanned, Unsystematic^ Planned, SystematicIndividual Orientation Group OrientationLow Participation^ High ParticipationAdapted from R.S. Schuler (1987). Human Resource Management Practice and Choices. In R.S. Schuler and S.A.Youngblood (Eds.), Readings in Personnel and Human Resource Management, 3e, St. Paul: West Publishing.Internal SourcesNarrow PathsSingle LadderExplicit CriteriaClosed Procedures 20Further, in this investigation, the communication system isconsidered as a sixth dimension of HRM-related activities. In anextensive survey of American managers, communication activitieswere found to make the biggest contribution to managerialeffectiveness (Luthans, 1988; Luthans, Hodgetts and Rosenkrantz,1988). In the work by Luthans et al. communication was considereda separate, yet complementary activity to HRM practices such asmotivating/rewarding, staffing, and training and development, forexample. Additionally, communication is considered important tohow employees perceive the organizational environment to operate(Joiner, 1987; Kanter, 1989; Morgan, 1988; Schein, 1986).The six dimensions for HRM are outlined in the followingparagraphs.a) Communication - Systems for communication operate atmultiple levels in the organization and may include, for example,meetings, written correspondence, television or telephone. Schein(1986) notes that communication may be either formal andinsitutionalized, or informal. In addition, communication may beopen and generally involve employees, or closed and specific toselected group members. As the complexity of the organizationincreases, forms of communication such as transition teams, taskforces, or joint-management teams may be used to create informationlinkages across diverse and often geographically decentralizedgroups (Barlett and Ghoshal, 1989; Joiner, 1987; Kanter, 1983;Prahalad and Doz, 1987).b) Planning - Planning involves forecasting human resourceneeds for the organization, and the appropriate steps necessary tomeet those needs. Human resource planning aims to anticipate21shortages or surpluses of human resources and to correctimbalances; anticipate needs related to employee development;identify employee skills and to provide opportunities foremployees; and link HR plans with the business plans of theorganization. HRM planning may vary according to whether it islong-term or short-term, formal or informal, tightly or looselylinked to corporate planning, explicit or implicit, integrated orsegmented, with high or low levels of employee involvement.c) Reward - Reward systems are the mechanism by whichorganizations seek to evaluate the contributions of employees inorder that direct and indirect monetary and nonmonetary rewards canbe distributed. Rewards are provided based on legal regulationsand the organization's ability to pay. Reward will vary accordingto whether there exists high or low base salaries; internal orexternal equity; few or may \"perks\"; and flexible or fixed andstandardized packages.^Rewards may encourage employeeparticipation; have incentives built in; be based on short-term orlong-term incentives; have employment security; and be eitherhierarchical or egalitarian based.d) Staffing - Staffing is usually defined as a search forand obtaining potential job candidates in sufficient amount andquality in order that the organization can renew itself and filljob needs. Staffing objectives are also concerned with satisfyingthe needs of job candidates. Not only should job applicants beattracted to an organization, but it is desirable that they beretained.^Staffing may be done internal or external to theorganization, follow broad or narrow career paths, offer single ormultiple promotional ladders, use explicit or implicit criteria for22promotion, or use closed or open (i.e. job postings) procedures.e) Training - Training and development activities refer toan attempt to improve current or future employee performancethrough new skill or knowledge acquisition, or the adjustment ofemployee attitudes. Training may focus on short-term or long-termneeds; narrow or broad applications, (i.e productivity versusquality of work life). Training may be planned and systematic orspontaneous, unplanned or unsystematic; have a group or individualorientation; and allow low or high employee participation.f) Performance Appraisal -^As a formal structure,performance appraisal (PA) is a system which measures, evaluatesand influences an employee's attributes, behaviors, andperformance. Data obtained from the appraisal may be used tocorrect employee deficiencies or to suggest alternative jobplacements for employees. Appraisal may vary according to whetherthe process emphasizes how, versus how many things an employeeaccomplishes; whether criteria are behaviorally or resultsoriented; the extent to which evaluation criteria are short-term orlong-term; whether the purpose is developmental, maintenance orremedial; the degree of employee participation expected; andwhether individual or group appraisal criteria are stressed.Although communication, planning, staffing, performanceappraisal, training and reward systems in progressive organizationsare linked, and generally responsive to the business and humanrequirements of the organization, each HR dimension may varyautonomously. For example, in response to HRM needs in aninternational JV, performance appraisal maybe widely modified fromthe practices of the parent firms, while other practices related to23training may be adopted from the parent unchanged. Alternately,within each broad HR area (i.e. performance appraisal, reward),variations as to what is adopted from the parent firms might alsooccur. For example, in the area of performance appraisal, the JVmay be the same as one or both parents related to a behavioralorientation in the appraisal, but differ from the parents on thelevel of employee participation in the process. Selectedmodifications to HRM are based on an open system approach, in whichHRM programs and activities fit the requirements and constraints ofthe organization based on its unique environment (Tsui, 1987). Ininternational JVs, the venture is expected to have different HRMand other strategic operating requirements from each of the parentfirms. As a result, adjustments to HRM policy and practice will bemade to best match the specific needs of the venture.C. HRM in Joint VenturesIn a review article which examines human resource managementin international joint ventures, Shenkar and Zeira (1987:549)observe that in \"the vast majority of the literature on IJVs,issues about human resources are sporadic and limited\". Related toHRM issues considered by previous researchers, Shenkar and Zeiraidentify a number of HRM issues in JVs which were problematic.These issues include: staffing, promotion, loyalty of employees tothe JV, decision-making, communication, and compensation. Inaddition, the authors note that research to date has ignored manyfundamental HRM issues in joint ventures such as careerdevelopment, termination of service, demotion, absenteeism,24employee attitudes, control patterns, job design, training, and jobrotation.Further, based on their literature review, Shenkar and Zeira(1987) suggest two structural characteristics of joint ventureswhich significantly affect HRM, as well as other management issues.These characteristics are:• Multiple ownership - Parent firms might differ relatedto:^private or state-owned; size; reputation orcompetitive advantage; industry focus; unionized or not;human resource orientation; objectives for joining theventure; or the extent to which one parent tries todominate the JV.• Multiple national affiliation - The JV is a setting forindividuals who often differ in national origin, culturalvalues and social norms.Shenkar and Zeira identify JV characteristics, and omissions in theliterature related to this topic, which form an important guide forfuture research on international joint ventures. However, sincethe publication of the 1987 article, the international literaturehas barely begun to address many of these issues related to HRM ininternational JVs. There are some exceptions.Notably, Pucik (1988) examined the causes of HRM-relatedproblems in 23 joint ventures established between American orEuropean manufacturing firms and Japanese partners, located inJapan. Pucik found that in the particular case of JVs in Japan,low performance in the ventures was related to an inability on thepart of the Western partner to manage the cooperative relationship.Several of the problems encountered were related to poorly designed25and executed HRM strategies. Further, these problems were embeddedin national cultural differences between Western and Japaneseparent firms, and their strategic orientations as to how to dobusiness. More specifically, difficulties in the management of theJV were related to:• Staffing - frequent changes among Japanese managers whichresulted in inconsistent communication links with theWestern partner; over reliance on the Japanese partner toobtain suitable recruits which reduced control overstaffing by the Western partner• Training - utilization of external training programswhich failed to provide socialization of employees to thevalues and norms of the JV; the venture became aconvenient training ground for the Japanese parentcompany• Performance Appraisal - use of Western-style PA which wasinappropriate for Japanese staff related to culturaldifferences (i.e. preferences for group vs. individualevaluation; level of explicit vs. implicit feedbackconsidered desirable)• Reward - high wage costs in order to attract employeesfrom the Japanese parent firm; perceptions by theJapanese that Western expatriates were bettercompensated.Other research further substantiates how the presence ofmanagers from different national cultures adds to managementcomplexity in international joint ventures. For example,Mendenhall and Black (1990) consider the subtleties of conflict26resolution in Japanese-American ventures. The authors describe 1.the Japanese do not view conflict and \"harmony\" on the samecontinuum (as the authors claim is the case with most Americans),and 2. the desire by Japanese to obtain harmony is specific tocontextual conditions (i.e. whether \"insiders\" or \"outsiders\" tothe group are present). These differences suggest implicitdifferences in conflict management between Japanese and Americans,which may or may not be apparent to the parties involved.Further, Tyebjee (1991) found that in venture partnershipsbetween Japanese and Americans, differences existed related tostrategic objectives and how information is controlled and managed.Peer task teams across the parent companies were viewed as one wayto bridge strategic and cultural diversity. In addition, inearlier work by Peterson and Shimada (1978), communicationdifficulties between Japanese and American executives due tolanguage differences were singled out as the most pressing problemin the ventures investigated.The importance of understanding the cultural implications ofinternational venturing is also underscored by Phillips (1989). Inthe investigation of a 50-50 American-Japanese joint venture,Phillips found that divergent management styles, inflatedexpectations and disputes over quality and labor practices resultedin ongoing problems in the venture. Many of the differences instyle and value orientations stemmed from national culturalheritage. Phillips comments (1989:39),(American) workers grumble about the daily calisthenicsand the boring dedication ceremonies Japanese seem tolove. And managers can't understand Japanese frugality:At one plant, the size of memo paper caused a 40-minutedebate.27In an exploratory investigation conducted in the People'sRepublic of China, Teagarden and Von Glinow (1989) consider HRM ininternational joint ventures between Chinese and foreign firms.Teagarden and Von Glinow found that the cultural and social systemsas they operate in China were a significant factor which affectedJV effectiveness. More specifically, a Confucian influence,decision-making structures, the form and function of relationships,face-saving, and ideological assumptions influenced HRM. In otherresearch, major attitudinal differences were found between Americanand Chinese managers in joint ventures regarding preferences fororganizational structure, work orientation and reward systems(Baird, Lyles and Wharton, 1989).In addition, Cascio and Serapio (1991) examine HRM in fourinternational alliances. The authors consider issues related tothe blending of national culture and management style, job design,staffing, training, performance appraisal, compensation andbenefits, career issues, and labor-management relations. Cascioand Serapio summarize the lessons which are learned from theirinvestigation:• when national and corporate cultures are blended, thepartners need to spend time building trust; understandingand accommodating each other's interests is important• job design can be enhanced when the partners are willingto learn from one another• recruitment and staffing policies should be well-definedin the early stages of the venture• orientation and training of employees should focus on thepreparation of employees to deal with the social context28of their jobs, as well as the development of technicalskills• performance appraisals need clear objectives, liberaltime frames in which to achieve results, and built-inflexibility related to changing market and environmentaldemands• compensation and benefits policies should be uniform toavoid employee feelings of inequity• careers opportunities must be ensured for local managers• in the early stages of the venture, the partners mustagree on suitable terms for the labor-managementagreementConsidering the results of this research, time is required to builda stable relationship between diverse partners in an alliance. HRMpolicy ideally is determined in the early stages of the venture,and is applied consistently. The partners may potentially learnnew capabilities in an environment when there is an openness to newideas and operating styles. The research by Cascio and Serapio isan important building block to an understanding of how strategicHRM operates in joint venture firms. The present research aims toboth corroborate and extend the lessons already extracted from theearlier investigation.Datta and Rasheed (1989) conceptualize the importance ofplanning in international JVs which considers the variousconditions affecting HRM. For example, variables to consider inthe planning process include the local labour market, differencesin cultural and management styles between the parents, and parentobjectives. Related to this last point, a degree of compatibility29between parent objectives is important if venture partners are towork effectively together. Further, Frayne and Geringer (1989)suggest that HRM practices are one way in which parent firms canassert influence, and accomplish their strategic objectives in theventure. Depending which parent manages staffing, training,reward, and performance appraisal, then implicit control in the JVis more likely to be exerted by that parent.In the preceding paragraphs, work was reviewed whichspecifically focuses on HRM in international joint ventures. Inaddition, theory and research in a broader range of organizationsrelated to corporate culture, organizational learning andinnovation, and national culture are thought to offer someunderstanding as to how HRM might operate in JV firms. Relevantissues are considered with reference to joint ventures, and areelaborated in the following sections.D. Issues for Consideration in Joint Venture Firms1. Corporate CultureInterpretive approaches to the study of organizations andculture suggest that culture is both process and product,externally and internally situated as meaning, and evolves overtime (Berger and Luckmann, 1967). Members of a group createcumulative interpretations of their reality based on ongoingactions and interactions. Shared cognitive frameworks exist aboutnorms, values and preferences and affect how members of a groupdemonstrate their familiarity with rules of appropriate behavior(Leary, 1983; Goffman, 1959). The informal components of culture30provide implicit patterns for action and a \"governing sense\" forthe construction of action (Zimmerman, 1966).Related to culture as \"sensemaking\" in organizations, Schein(1984) elaborates that corporate culture exists at three levels:1. behaviors and visible data; 2. values; and 3. basic assumptions.Behaviors are represented at the most surface level of culture, andmay be demonstrated by office layouts or the manner of dress. Ata deeper level, values govern behavioral patterns and are lessaccessible. In some instances, values are not readily identifiableeven to individuals or to groups who influence, and who are in turninfluenced by the governing values. At the most elusive level ofcorporate culture are basic assumptions. Schein refers toassumptions as invisible, deeply embedded characteristics which arerooted in relationships to the environment, the nature of time,activity, and space. These assumptions are related to the nationalcultures to which individuals belong, and represent enduring,social characteristics.In addition to culture existing at multiple levels, culturehas both external and internal elements (Schein, 1986). Externalelements of culture include consensus on 1. a core mission; 2. themeans for goal attainment, (i.e. organizational structure, reward,control and information systems); 3. the measurement of results,and 4. the management of conflict. Internal elements of corporateculture include 1. a common language and communication system, 2.consensus on group boundaries (who is in or out); and 3. how powerand influence are stratified. Related to this, leaders in theorganization and HRM staff might help to provide, for example, afocus for employees of what is valued or normative behavior; how31critical incidents are to be handled; or the criteria forrecruitment, rewards, or appraisal.The company culture is related to the corporate philosophy ormission, product and market strategies, organizational structures,HRM systems and the attitudes of top management, (Enz and Schwenk,1988; Kono, 1990). For example, Kono (1990) elaborates that HondaMotor Corporation has an energetic, innovative culture which wasdeveloped by the top management team. In accordance with thecorporate philosophy, an atmosphere is created at Honda in whichaggressive, new product development is inspired. To encourageinnovation, recruitment systems are designed which match strategicfirm objectives.In multinational organizations, different goals, perceptionsand values of parent firms may result in corporate disharmony, andfrequently to the failure of the venture (Dymza, 1988; Doz andHamel, 1991; Killing, 1983; Parkhe, 1991). Further, partnerheterogeneity may hamper organizational learning (Doz and Shuen,1991). Norms which foster flexibility and learning may serve tobridge differences in strategic orientations or national cultureswhich exist between the partner firms (Parkhe, 1991).2. The Creation of Innovative OrganizationsResearchers have struggled with a concept and definition ofhow organizations learn, adapt, and change to accommodate newcontingencies and environmental conditions (Argyris and Schon,1978; Chandler, 1962, Lyles, 1988). Organizational theory hasconsidered learning at two levels in companies: 1. at a strategiclevel major ideological changes are instituted; and 2. at a32tactical level modifications to practices occur, but on a scalethat is unlikely to transform the course set for the company(Jelinek, 1979; Lyles, 1988; Pettigrew, 1985). Organizationallearning has been variously described as adaptation and response tonew information (Shrivastiva, 1983); new insights or knowledge(Argyris and Schon, 1978; Hedberg, 1981); new structures (Chandler,1962); and new systems (Jelinek, 1979). In this research, learningrefers to the creation of new ideologies, systems and processes atthe organizational level.Although learning and innovation are generally important inorganizations, this capacity is critical in competitivecorporations which operate on a global basis. In complexorganizations such as joint ventures, where multiple cultures andrequirements for innovation exist, then \"organizational learningbecomes a threshold condition for alliance success\" (Parkhe, 1991).One way in which a capacity to learn is enhanced in joint venturesis through the development of flexible structures and relationshipsbetween the parents and the venture. Of increasing importance isthe ability of JV managers to revise HRM and other systems inresponse to changing internal and external environments.Organizations must learn new competencies. Accordingly,\"organizations that learn quickly and well have a distinctadvantage in implementing change\" (Nord and Tucker, 1987:32). Oldsystems are discarded and replaced by more strategic andappropriate concepts and practices. The capacity for organizationsto alter HRM or other management systems in international jointventures prevents management orientations from becoming obsoleteover time. In global firms, an experimentation-based policy33process is more likely to take advantage of organizational varietyand diversity, resulting in more creative organizational outcomes(Bartlett, Doz and Hedlund, 1990).HRM systems can either support or curtail an environment forlearning. Pucik (1988:77) advocates \"that the transformation ofthe HR system to support the process of organizational learning isthe key strategic task facing the HR function in firms engaged ininternational cooperative ventures\". According to Pucik, learningin alliances is more likely when there is:• a high priority given to learning activities• involvement by the HR function• long-term planning• a focus on obtaining and retaining high quality staff• training provided in cross-cultural competence• a career structure which is conducive to learning• reward and performance appraisal which focuses on long-term goals, learning activities, and global strategies• incentive for the transfer of \"know-how\"• an HR group who have knowledge of the partner strategiesIn addition, HR staff and other managers in the organization needto accept the responsibility for the creation of conditions whichresult in learning.^Learning is a process which requiresintegration. To enact this process the HR department will requiresupport from other managers and employees.\"Politics in organisations breed in times of change\"(Pettigrew, 1985:43). Change may threaten the existingdistribution of resources, affect salaries or promotionalopportunities, and shift the control of tasks. New roles for34members of the organization may be required. For example, insystems where there is high employee involvement, then the role ofsupervisors will feasibly be reconfigured. In the case ofadministrative innovations, permission for change may be necessaryprior its implementation (Frost and Egri, 1991; Kanter, 1983).As already mentioned, strategic alliances have numerousstakeholders who are both internal and external to the alliance(Lorange and Roos, 1992; 1991). With respect to strategic andtactical changes in alliances, and more specifically in jointventures, support and approval of the multiple interest groups(i.e. JV and parent employees), is advisable prior totransformations in organizational values or systems. Toeffectively implement learning and change, HR staff will requireboth knowledge of the concerns of various stakeholders (Kanter,1983; Tsui, 1987), as well as the political skills necessary tomanage change.Finally, innovation may be more likely in organizations wherethere is support for multiple values and perspectives. Evans(1986) describes that complex organizations, with the potential forinnovation, are likely to exhibit paradoxical qualities. Examplesof \"value dualities\" are systems which have simultaneous elementsof control and flexibility, formalization and informality, orindividuality and teamwork. Cameron and Quinn (1988) also endorsethe benefits to organizations of a competing values approach, andsuggest that highly effective organizations pursue competing,paradoxical criteria simultaneously, rather than a single set oforganizational value criteria. More recently, Evans and Doz (1990)elaborate on qualities of the \"dualistic organization\", in which35competing value characteristics are effectively balanced. Evansand Doz suggest that \"dynamic balances\" may be created inturbulent, complex organizations when, for example, teamwork iscreated among strong individuals, opportunism is planned, orpartnerships are formed between competitors. Evans and Doz addthat a starting point for the introduction of dualistic thinkinginto organizations is through various HRM processes.3. National Culture as ContextThe national culture to which an individual belongs has anindelible influence on both attitudes and behavior. As Hofstede(1980) describes, the shared ideas of national cultures build uponsymbolic frameworks, mental programs and conceptual distinctionsthat shape social action. Underlying assumptions prescribe sharedways of thinking, perceiving and evaluating the world, self, andothers (Ronen, 1986). Attitudes toward uncertainty and change, ortask versus social orientations are examples of national culturalassumptions which affect perceptions of how the world shouldoperate.Culture is passed from one generation to another. Cultureembraces the concept of morality, determining for each group whatis right and what is wrong. According to Nath (1988:24),Culture is shared by all members of a particular group,and it is essential for the basis of social and communallife. In the words of Hofstede (1980:27) the essence ofculture is collective mental programming. It is the partof our conditioning that we share with other members ofour nation, region, or group but not with members ofother nations, regions or groups.An early anthropologist defined culture as \"that complex whole36which included knowledge, belief, art, morals, law, custom, and anycapabilities and habits acquired by man as a member of society\"(Tylor, 1924:1).Consistent differences in value systems and socialorientations have been observed among national cultural groups(Child, 1981). To illustrate, a study conducted by Meindl, Huntand Lee (1987) examined the differences between Western\"individualism\" and Eastern \"collectivism\". In an individualisticculture such as the United States, ideas tend to arise fromindividual action, competition is positive and people are self-governing. Alternately, in the collectively-oriented cultures ofSouth Korea, China and Singapore, action is generally agreed uponby consensus, there is greater dependence on the larger group, andrelationships evolve around joint responsibility. Self-interest,so prominent in Western philosophy, is less relevant in acollective society.In another example, related to an orientation to activities,North Americans generally see themselves as \"doers\" and seekaccomplishments that can be externally measured. For instance,employees are rewarded for their successes with promotions, raises,and other forms of public recognition. In contrast, in cultureswhich focus more on \"being\" than \"doing\", there tends to be moreof a natural acceptance of the pace of life, with little attempt toforce or influence outcomes. Further, related to a time dimension,Americans have a slightly future orientation and progress is oftentied to future goals. Eastern societies tend to focus more on thepast and value the importance of societal customs and traditions(Adler and Jelinek, 1986).374. National Culture in OrganizationsLaurent (1986) studied groups of managers from differentnational backgrounds and found that nationality had three times theinfluence as a predictor of managerial assumptions than any othercharacteristic such as age, education, function or type of company.Accordingly, national cultures influence the corporate culture oforganizations, (Adler, Doktor and Redding, 1986; Adler and Jelinek,1986; Laurent, 1986). Corporate culture is represented in the moresurface values and norms present in organizations, and is unlikelyto significantly alter underlying assumptions which stem fromnational culture assumptions. Laurent (1986:99) writes,Deep-rooted assumptions could then be better understoodas the historical result of broader cultural contextslike civilizations and nations. Organizations would onlyselect from the available repertory of their largercultural context of a limited set of ideas that best fittheir own history and modes of implementation.Consistent with this argument, one might expect a manager fromJapan who works in a U.S. based joint venture to modify certainelements of corporate culture such as dress or open door policies,without actually changing basic, governing assumptions as toauthority or appropriate levels of formality. These latterassumptions are rooted in the history and traditions of Japanesesociety, and as such are less malleable or subject to alteration.Related to the implications of national culture forinternational joint ventures, research has generally suggested theinfluence of the socio-cultural environment on the managementprocess, (Chiu and Bu, 1989; Kelley, Whatley and Worthley, 1987;Lindsay and Dempsey, 1985; Mendoca and Kanungo, 1989; Schneider,1989; Warner, 1986). In addition, assumptions and values which38operate within different national cultures are selectivelytransferred into specific HRM practices (Ishida, 1986; Negandhi etal. 1985; Peterson and Schwind, 1977; Schneider, 1988). Variousresearchers have found different preferences for compensationsystems (Atchison, 1989), training and development (Tang andKirkbride, 1989), and performance appraisal (McEvoy and Cascio,1989; Whitely, Tang and Kirkbride, 1989) related to the nationalculture of employees. Further, management practices are notnecessarily transferable across cultures. For example, Western-style performance appraisal systems are considered inappropriate inHong Kong, where the concept of \"face\" precludes the use ofconfrontative feedback. Americans prefer individually-orientedappraisals, as opposed to Taiwanese workers who are more likely toprefer a group focused appraisal (McEvoy and Cascio, 1989).Much has been said about the differences which exist betweenJapanese and American management practices. Related to variationswhich stem from national culture origins, Japanese managementphilosophy is described as based on lifetime employment, slowevaluation and promotion, non-specialized career paths, groupdecision-making, implicit control mechanisms, and collectiveresponsibility (Ishida, 1986; Peterson and Shimada, 1978).However, some modification in long standing management practice ispossible. Related to this, there is a recent trend in Japan towardrestructuring wage controls, and a greater focus on performance-based evaluation and rewards (Mroczkowski and Hanaoka, 1989). Incontrast, American management systems focus on individualaccomplishment, hiring externally, and explicit control mechanisms.Performance tends to be objectively measured and rewards are39distributed based on equity and merit.In research in 37 joint ventures, Killing (1983) notes thatmanagers of different nationalities have varying attitudes tofundamental assumptions regarding the importance of materialwealth, the value of on-the-job performance and the desirability ofchange. According to Killing (1983:57),The greater the cultural gap between the parent's basecountries, the greater the problem (in the IJV). Afundamental hindrance to the creation of a core skill cansimply be the difference in language. Many jointventures formed in Japan in the 1960s between Japaneseand North American firms failed in the early 1970s.Cultural differences were cited as a major problem inmany of these.5. Joint Ventures as a Case of Socio-cultural MergingThe merging of diverse cultures within the same organizationis a complex and difficult process. In international jointventures, the parent firms often represent diverse national orcorporate cultures. For example, in an American-Japanese jointventure, each cultural group brings to the JV different values,expectations and operating procedures. In this instance, Japaneseand American managers may need to work together to create neworganizational forms appropriate to all groups in the venture.Alternately, cultural merging may occur between groups with theirorigins in the same national culture. Again in the context of ajoint venture, employees may be consolidated who are all Americanin cultural origin, but who come from parent organizations withdifferent corporate styles and ideologies. Differences incorporate philosophy might relate to appropriate levels of risk-taking, or the amount of training offered to employees.40In organizations where cultures combine, ambiguity, or thedenial of another's culture may result (Martin and Myerson, 1988).In an American-Japanese JV for example, members from diversecultures may find the values or habits of the other group confusingor inappropriate. Ishida (1986) examined the transferability ofJapanese values and practices to non-Japanese subsidiary operationsand discovered numerous problems which were related tophilosophical differences between the two groups. Ishida comments,The difference in the concept of job leads to conflictbetween Japanese and non-Japanese working in the sameorganization. The non-Japanese cannot bear the vaguenessof job boundaries and complain that the Japanese bossoften trespasses on his own area of authority. TheJapanese, on the other hand, criticize the non-Japaneseworkers for 'doing only what they are told to do' andcomplain that they 'lack initiative and flexibility'.Subsequently, a learning process is required in which group membersdevelop a new understanding of expected requirements in theorganization. In addition, group members will need to work towardan appreciation of an unfamiliar culture. When different nationalcultures combine, the possibility exists for either positive,creative outcomes - or stress (Adler, 1986).According to Moran and Harris (1982), cultural synergy ispossible when new forms of learning transcend the boundaries ofseparate cultures. National cultural differences are neitherignored nor minimized, but are appreciated as a source forinnovation and change. Managers and other employees are morelikely to combine elements of contrasting value systems or culturesin organizations where there is flexibility, trust and support forchange. A philosophy which establishes a norm for pluralism inperspectives and capabilities is important (Bartlett and Ghoshal,411989; Prahalad and Doz, 1987).The merging of subcultures in joint ventures is likely tonecessitate some degree of value negotiation, and openness toanother's point of view. When opposing belief structures arebrought together, compromises are required related to discrepantbeliefs or political differences (Walsh and Fahey, 1986). In thiscontext, strategy-making will ideally be participative (Miller andFriesen, 1984) and involve members of each group.In general, mergers of organizations tend to ignore theimportance of human resource dynamics (Marks, 1989; Marks andMirvis, 1986). In corporate mergers, Schweiger and Weber (1989)note the importance for determining how HRM policy and systems areto be combined and they recommend either: (a) partial integrationof HRM policies of both firms, or (b) leaving the policies andsystems of the firms separate. In research which examines Japanesesubsidiaries in Taiwan, Japanese managers selectively added aJapanese influence to local management practices; and in someinstances Japanese systems were implemented in entirety (Negandhiet al. 1985).Related to these issues, how do joint venture companies manageHRM policy and practice when national cultures or corporatecultures combine? Is there an integration of HRM policy adoptedfrom both parents and applied to all JV employees? Alternately,are certain aspects of HRM policy applied to different subgroups inthe venture? Further, is there a role which the HR department canplay in diffusing the difficulties experienced in companies whendiverse cultures are combined?42E. SummaryInternational joint ventures are used increasingly as amechanism for the enhancement of firm competitiveness on a globalbasis. Although the role of HRM in international corporations hasbeen recognized by researchers as important, there has been verylittle research on the role and function of strategic HRM ininternational joint ventures. The current research examines HRM asit operates within the venture, and related to intercompanyrelationships.Management in joint ventures is complex. In those studies inwhich HRM in international joint ventures was investigated, issuesof concern relate to multiple ownership and multiple nationalaffiliation (Shenkar and Zeira, 1987). Further, partner ability tomanage the cooperative relationship when multiple national andcorporate cultures combine was considered to be important (Cascioand Serapio, 1991; Pucik, 1988; Teagarden and Von Glinow, 1989).More specifically, Cascio and Serapio (1991) found trust building,job design which enhances learning, well-defined recruitment andstaffing policies, training programs and fair compensation policiesto be salient issues in joint ventures. Although many of theseissues are also relevant in wholly owned companies, complexity isadded to how HRM operates when multiple parent firms are involved.For this reason, planning in joint ventures is especially importantin order that differences in cultural and management styles betweenthe parents and the venture are considered (Datta and Rasheed,1989).Beyond the realm of investigations specifically conducted in43joint ventures, a broader band of organizational literature offersinformation as to how joint ventures might operate. Corporateculture is considered with respect to how people in organizationsconstruct meaning, and the levels of values and assumptions whichoperate. The company culture is interrelated to the corporatemission, product and market strategies, organizational structures,HRM systems and the attitudes of executives (Enz and Schwenk, 1922;Kono, 1990).Further, how organizations learn, adapt and change at bothtactical and strategic levels is of interest. In companies inwhich global competitiveness is a goal there are specialrequirements for innovation and transformation. As Parkhe (1991)describes, in strategic alliances an ability to learn is crucial tothe attainment of organizational successes. HRM systems can eithersupport or curtail an environment in which learning occurs (Pucik,1988).Related to national culture, previous research has generallysupported the influence of the social and cultural environment onmanagement practices (Kelley, Whatley and Worthley, 1987;Schneider, 1989; Warner, 1986). In particular, assumptions andvalues which operate within different national cultures are oftentransferred into HRM practices (Ishida, 1986; Peterson and Schwind,1977). In international joint ventures when multiple national orcorporate cultures combine, \"cultural merging\" occurs which oftenrequires adjustments of HRM policy and practice to meet newlyevolving realities.44CHAPTER THREERESEARCH METHODOLOGYA. Research Considerations1. The Research OrientationThis project explores the development and implementation ofHRM policy and practice in a small number of successfulinternational joint ventures. The intent of the research is togain an indepth understanding of strategic HRM through thedescription of various HRM practices as they operate in the JVs.Both formal, institutionalized HR practices are considered, aswell as informal operating systems. In addition, the researchintends to provide an understanding of why and how HRM operates asit does in each company. This format pertains to the questionsasked in exploratory case study methodology (Yin, 1989) and isappropriate when relatively little previous investigation exists ona topic. In this instance, the aim of the project is to develop acomprehensive description of HRM in joint ventures. Unlike someother case study research (i.e. Allison's Essence of DecisionMaking Explaining the Cuban Missile Crisis, 1971) the intent is notto pose competing explanations for the same set of events.Instead, this investigation is more oriented toward the potentialdevelopment of an integrative framework for how various areas ofthe theoretical literature (i.e. corporate culture, nationalculture, organizational learning) may complement each other inorder to provide a better understanding of strategic HRM in jointventure firms.Further, the methodology in this project is consistent with45research done by Kydd and Oppenheim (1990), who considered HRM infour exemplary companies. This research also conforms to a call byUlrich (1987) for a detailed analysis of strategic HRM, in order togain a more penetrating appreciation of how firms are able toincrease their effectiveness through HRM applications. In thisspirit, the present project aims to provide a comprehensivedescription and understanding of various HRM practices in foursuccessful international JVs, related to the generation of theoryin this area. The results of this investigation also provideinformation to managers and practitioners concerning theimplications of various strategic HRM policies and practices.The research uses multiple sources of data collectionincluding documentation, on-site observation, interviews, andquestionnaires. Multiple methods for data collection allow across-analysis of information in order to ensure consistency in thedata, and are a signal for when further information or analysis isrequired. Multiple methods of data collection are recommended byseveral authors, (Adler, 1984; Eisenhardt, 1989; Yin, 1989), toobtain greater breadth and reliability of the results of theresearch. In addition, information is collected at multiple levelsin each organization, (i.e. executives, mid-level managers orsupervisors, and production staff), to gain an appreciation of thevarious perspectives in each group.2. Securing the Companiesa) The Type of Joint VenturesFour successful international joint ventures firms wererequired for participation in the research. A sample size of four46was chosen in order to allow greater comprehensiveness across jointventures (which vary related to national culture of the parentsetc.) than would be possible in a single case analysis. For acompany to qualify as suitable for the project, the followingcriteria would need to be met:• The company would be a \"formal\" joint venture (i.e. anindependent company which is the product of the union oftwo other firms).• The partners in the venture would be of differentnational origins in order that the JV be \"international\"in nature.• The partnership between the parent firms would beapproximately equal in terms of the equity of ownership,(i.e. a 50/50 to 60/40 ownership split in the JV).• The JV would be \"successful\" both in terms of a) externalawards and recognition given to the venture for exemplaryperformance, and b) because managers and other employeesin the JV felt that the venture was a satisfying place inwhich to work.• The JV would have its headquarters and/or majorproduction site in North America, for practical reasonsrelated to the collection of data.• The management of the venture would be willing to have meon site for two weeks, and to allow me access todocuments, and to staff for the purpose of interviews.b) An Elusive CommodityGaining entry to the types of companies designated for theresearch was incredibly difficult. I spent six months full-time47attempting to contact possible joint venture firms, and to securethe participation of managers for the project. During the courseof this task I contacted approximately 350 managers or academics,to a) locate possible joint ventures, b) determine if a companyeither met the criteria designated for entry to the project, or c)to more specifically request participation. Most people whom Icontacted did not seem to be aware of joint ventures which existed,or where they were located. As part of my search, I also usednumerous library sources, however because of the often rapid changeof ownership of JVs, many of these sources were outdated.In part, the difficulty of finding suitable JVs for theproject might be considered related to the followingcharacteristics:• There is no clear designation of joint ventures asopposed to other forms of strategic alliances, andtherefore in the literature as well as in otherdescriptions, a partnership company may be called a jointventure, when in fact it is not.• There is no accessible, comprehensive listing of jointventure firms. Various government agencies do not havethis information, including the Conference Boards in bothOttawa and New York, provincial or state agencies,municipal groups, or private agencies.• The often quickly changing ownership of JVs meant thatthe most recent directories of company listings areoutdated before their publication.• In many instances, managers did not want a researcher onsite. My perception is that this hesitancy was related48to a desire by managers to keep strategic initiatives\"in-house\". Several companies did not want competitorsto gain information as to what they were doing. Some ofthe companies which I had contacted wrote back and saidthat their operations were \"highly confidential\". Othercompanies did not want to participate due to feared\"leaks\" about the company identity in futurepublications, (although the option of confidentiality waspresented to company managers in each case). Further, Ifelt some managers whom I contacted were not particularlysecure about the quality of their HR operations in thecompany, and preferred not to have an outsider present toview operations or practices. In other cases, managerscited that they simply did not have the time to allowcompany involvement in a research project of this nature.c) The Process for Gaining EntryOnce possible joint ventures had been identified, I telephonedan upper level manager in the venture, (usually the Vice-Presidentof Corporate Development or the Vice-President for Human Resources,and in some cases a representative in the Public Relationsdepartment), to determine whether the venture had the qualifyingcharacteristics of the companies I was hoping to locate for thisinvestigation. Based on this conversation, and if there was somepossible interest, I sent a letter to this contact person whichdescribes the intent of the project, and the required amount ofinvolvement by the company. In addition, the companyrepresentatives were informed that if they were to participate in49the project, the company would have the benefit of a report whichoutlines the findings in the company, as well as an executivesummary report related to the general research project. Refer toAppendix 1 for a copy of the letter and project outline which weresent to each company with potential to participate in this project.Typically, approval for my entry was obtained in a managerialmeeting which would include the JV President, and the Vice-President or other senior manager for HRM. I offered follow-upinformation, as requested. Approvals for research entry often tooksix to eight weeks.Finally, I was able to secure the participation of four jointventures - Mayo Forest Products, OCG Microelectronics, Optima andTriad. Briefly, at Mayo Forest Products contact was made with theVice-President of Canadian Pacific Forest Products (the parentfirm), who quickly informed me that research access to the millwould be possible. I went with him to the mill to meet with theGeneral Manager for the JV and the Personnel Administrator. Atthis time, the Executive Secretary to the General Manager in the JVoutlined for me meetings which would be beneficial to attend, andpeople I should interview. Research began in the millapproximately one week later. At OCG Microelectronics, contact wasinitially made through the Public Relations Department, and afterabout eight weeks during which research access to OCG was apossibility, I made a follow-up call to the President of theventure. I was given immediate approval for the project, pendingadditional approval from the Manager for HRM, who also wasinterested in participation in the research. At Optima, contactwith the JV was made through the Manager of Employee Relations, who50over a seven week period, was able to get approval from seniormanagers, including the Vice-President of Personnel for my entry.Securing the participation of Triad was both quick, and veryfortunate. I contacted someone in the Japanese parent company whoI already knew, who in turn contacted a key person in the venture.Access to Triad was determined within days. This was particularlylucky, as I was told the plant had not previously been involved inany extensive research investigation, despite numerous attempts byother researchers to gain access to the company.3. The Process for the Researcha) The FormatI spent two weeks in each joint venture. In addition, at MayoForest Products I returned to the JV for two days, two weeks afterthe research data had already been collected, to interview peopleabout any changes they anticipated for Mayo due to the resignationof the General Manager the previous week. Data was collected atMayo Forest Products in April 1991, and in the other three venturesin July and August 1991. Approximately 20 interviews wereconducted at multiple levels in each company, and the titles ofthose people who were interviewed appear in Appendix 2. I had a\"contact person\" in each JV, who assisted me with whom would berelevant and responsive individuals to interview, arranged for awork space, suggested meetings to attend, outlined relevantdocuments to collect (and often provided them), and informed meabout miscellaneous items of company protocol. The title of mycontact varied: at Mayo it was the Executive Secretary to the JVGeneral Manager; at OCG it was the HR manager; at Optima it was51the Manager of Employee Relations; and finally, at Triad, it wasthe Training Specialist who fulfilled this role. All my contactswere well informed about company operations, and very generous oftheir time and insights.The operations of the joint ventures were not usuallycontained in a single location. Subsequently, to gain a broaderperspective of the operations, I visited more that one site tocollect information or materials for this research. At Mayo ForestProducts, most data was collected at the mill, but interviews witha Vice-President in the Canadian parent firm, a Vice-President forthe Japanese parent firm, and the Personnel Officer for salariedstaff in the JV were conducted at the Regional office for theCanadian parent, where these individuals were located. At OCG,which is a very decentralized operation, I interviewed people andcollected other information at the JV Headquarters in New Jersey;the JV plant in East Providence, Rhode Island; the Ardsley facilityin New York state; and the CIBA-GEIGY U.S. parent companyheadquarters, also in New York state. At Optima, data wascollected at the JV headquarters office and at the twomanufacturing plants, which were all located in the same city.Triad, is a self-contained unit, and all data for the venture wascollected at the plant.While at the main research location for each venture, I wasusually given a desk or work space to use temporarily. At MayoForest Products, I had a desk in the Administration area, in awell-travelled location. At the other joint ventures, I had spacein the HRM areas. Although security was a priority in all the JVs,I was given very good access to information. For example, I was52able to obtain copies of requested documents, and in some casesmanagers volunteered to provide me with confidential reports. Inaddition, I was given the freedom to explore the various JVlocations on my own. At both Optima and Triad, which requiredsecurity entry badges, I was given a visitor's badge for the lengthof the stay at the company; and this permitted me access to certainareas. At Triad, freedom of movement was restricted in the plantfor safety reasons, although I was able to move freely in theadministration areas.b) The Role as ResearcherIn ethnographic and other case study research, characteristicsof the researcher such as gender or status may influence the datacollection process with respect to how the participant views orresponds to the researcher (Spradley, 1987). As one of the\"instruments\" in the study, the fact that I am female and agraduate student may theoretically affect the participant-researcher relationship, and further, the information which isobtained for the purpose of this investigation. With considerationfor my perceived role as researcher in mind, I attempted to fit thecharacterisics of the environment as much as possible. Forexample, in the mill operations I wore jeans and hardtoed boots,when alternately in an office setting I chose to wear conservativebusiness clothing.My perception is that employees in the ventures identified mein a researcher capacity while I was visiting in each company. Iwas not asked for advice in a consulting role. On occasion, Ifelt that I was a confidant to some individuals who wereinterviewed. Related to this, some respondents shared personal53concerns related to the work environment, which generally theyspecified were intended to be confidential. Once I was on the JVsite, and sometimes in advance, employees who were to beinterviewed were informed of my intentions in the company, and thescope and focus of the research. In some cases, the project outlineand a brief summary of my background and experience, (which bothwere sent to the JV as part of the process to gain entry to theventure), were copied and distributed to staff.Although the majority of participants in the research areNorth American in cultural origin, some of the senior managers whowere interviewed were also Swiss (2), German (3) or Japanese (4).Related to this fact, I tried to ensure that each cultural group ofparticipants was comfortable with the interview format, and wasable to understand the content and intent of the questions. Onlyin the case of some of the Japanese respondents was languageproblematic. To ensure understanding I spoke slowly and rephrasedquestions if there appeared to be any confusion or hesitancy in theresponse. In only one instance was a written inventory completedwith an HR manager who did not have English as a first language.On this occasion, I went through the inventory with this individualto ensure an understanding of the content.4. A Variety of Informationa) DocumentationInformation on the joint venture, (i.e. age, reason forformation, industry focus etc.), and the strategic orientation ofthe company, (i.e. the corporate vision, historical changes), werecollected. Appendix 3 provides a more comprehensive listing of54some of this content. To gather information about the JV moregenerally, and HRM policy and practice more specifically, a widevariety of documents were consulted. This included, for example,company newsletters, employee handbooks, company brochures ormanuals, JV annual reports, policy statements, HR forms, newspaperarticles on the JV, or union agreements. Annotated bibliographiesfor each JV, which itemize the documents used in the research, anda brief description of their contents, appear in Appendix 4.b) On-site ObservationDuring the time when I was on-site full-time at each jointventure, I was able to observe operations, attend meetings, andhave numerous informal conversations with employees at multiplelevels in the organization. Information which was collected fromthese experiences, as well as my personal impressions of activitiesor events in the JV, were recorded in a journal. In each company Iwas given an introductory tour of the manufacturing operation.The number of meetings which I attended varied on each site.For example, at Mayo Forest Products I attended 17 meetings in 10days. This included production meetings, mill maintenancemeetings, manager's meetings, and a closed union meeting. At OCG,due to the amount of travelling between sites, I attended fewermeetings, although I did sit in on some of the production meetingsat the plant facility. At Optima, I attended a communicationmeeting, production meetings at both of the plants, and a \"teammeeting\". In conformance with plant policy that visitors are notpermitted into the plant without a guide, I was not able to attendfloor meetings at Triad. However, I did have the opportunity toattend several Quality Circle presentations, which occurred in July55when I was there. I also attended an HR meeting while at Triad.In addition, I was able to get some personal insights fromemployees about the operation of the venture over lunch, or inother private conversations. Responses were either volunteered orresulted from my informal prompting.c) InterviewsThe interview format was consistent for all participants. Iwould introduce myself and the research topic, ask participants ifthere were any questions, request permission to tape-record thesession, and get the participation consent form signed.Confidentiality was discussed, and participants had two options:that I could use names with statements which were made, or thatconfidentiality would be guaranteed. This portion of the consentform was completed at the end of the interview, in order thatparticipants could better judge their preference based upon whatthey had already said. Refer to Appendix 5 for a copy of theconsent form. No one refused to have the session tape recorded.To lead participants into the interviews gradually, we began withthe participant describing his or her background and experience,and the work role in the venture. I did not take notes, but choseto have a \"conversation\" with the individual who was interviewed,which allowed for eye contact, as well as a more informalatmosphere. On a few occasions, participants asked that the taperecorder be turned off if they had something personal,confidential, or perhaps incriminating to tell me.^In thisinstance, I would usually ask permission to take notes.^Myimpression is that employees were comfortable in the interviews,and generally unguarded in their responses, although there were a56few exceptions.The interviews were relatively unstructured and I used open-ended questions as probes. Participants were encouraged to includeany information they felt was relevant to help me understand howand why HRM policy and practice operated as it did in the venture.On average, the interviews were one and one-half to two hours inlength. An outline of general interview questions, and sub-questions which could be used as interview prompts appear inAppendix 6. Many of the questions which appear in this appendixare based on previous theoretical or empirical work by Datta andRasheed (1989), Frayne and Geringer (1989), and Pucik (1988), butwere developed specifically for the current project. There are twointerview guides in Appendix 6 which vary slightly from oneanother. One guide was used with HRM staff, the other foremployees who were less familiar with HRM policy and practice.Appendix 7 is a question guide used with the JV General Manager.In all cases, questions were not necessarily asked in the order inwhich they appear, but in an order which evolved naturally in thecourse of the interview.Information from tape recorded interviews was formatted ontoa computer, and an interview tape was replayed until relevantmaterial was accurately captured. Rather than a completetranscription, I selected what I felt was important to the goals ofthe investigation and either copied verbatim quotations, orsummarized the material into descriptive notes. Material which wasrepetitive or irrelevant was therefore not put onto computer,although all tapes have been retained. As a reliability check onthis procedure, a graduate commerce student was hired to check a57random sample of three tapes from each JV, for a total of 12 tapes.The graduate student was instructed to ensure that verbatim quoteswere accurate, and to check that I had accurately captured theessence of the rest of the conversation in notes. I asked that shenote errors, omissions of relevant material, or additions. A copyof the instructions to the reviewer are in Appendix 8. Thereviewer considered the interview transcripts to be 100% accuraterelated to quotations. In instances where content discrepanciesdid infrequently occur, I rechecked the tapes to ensure thatparticipant comments were accurately noted.d) The Minnesota Job Satisfaction QuestionnaireThe short form of the Minnesota Job Satisfaction Questionnaire(MSQ) developed by Weiss, Dawis, England, and Lofquist (1967) wascompleted by a random sample of employees in each venture. Thequestionnaire has been used over the years as a reliable measure ofjob satisfaction (Muchinsky, 1983). The short version of theinventory consists of twenty items related to various aspects ofone's job. The employee responds on a 5-point scale. In additionto an overall score for job satisfaction (which is a summation ofscores on all MSQ items), there are two subscales which determineemployee levels of \"intrinsic\" and \"extrinsic\" job satisfaction.The intrinsic satisfaction scale consists of twelve items whichreflect achievement, ability utilization, and autonomy, forexample. The extrinsic scale consists of six items which relatesto policy administration or working conditions. The MSQ manualindicates that internal consistency, (based on a wide variety ofoccupational groups), has a mean reliability coefficient of .86 forthe intrinsic satisfaction scale, .80 for the extrinsic scale, and58.90 for the general satisfaction scale.This research focuses on the organizational level of employeeresponses to job satisfaction, rather than on individual levelresponses. For this reason, mean scores and standard deviationsfor each item of the MSQ are aggregated across all respondents ina JV. Aggregated mean scores for overall job satisfaction, andcategory scores for intrinsic and extrinsic levels of jobsatisfaction were obtained. As suggested in the test manual, it ismost meaningful to consider scores for overall satisfaction,intrinsic satisfaction and extrinsic satisfaction compared topercentile ratings. A high degree of job satisfaction isrepresented in the 75th percentile or higher; mid-rangesatisfaction is the 26-74 percentile, and a low degree of jobsatisfaction is reflected in the 25th percentile or lower.e) The Culture InventoryThe Culture Inventory considers various aspects of corporateculture as it operates within a company. The inventory has twelveitems adopted from Quinn's (1984) competing values model. (Referto Appendix 9 for an elaboration of the theory which underliesQuinn's model). Four types of corporate culture are represented(three items for each culture type). The various cultureorientations include group, developmental, hierarchical andrational cultures. Participants respond on a 5-point scale toindicate their level of agreement with each of the twelvestatements in the inventory. I made one modification to theoriginal inventory and changed \"participant's business\" to \"thiscompany\" which I felt would be more relevant to the respondents inmy sample. According to Yeung et al. (1989) who have also used59this inventory in research with a large sample or companies, thereliability coefficients for the four culture types are: groupculture (.79), developmental culture (.80), hierarchical culture(.76), and rational culture (.77). The level of culturalpredominance in each of the four culture categories is determinedby adding numerical responses for each group of three items. Aswith the MSQ, organizational level responses were obtained in eachJV. Scores for the Culture Inventory are represented as aggregatedmeans for each item of the inventory. Mean scores were alsoobtained for each of the four corporate culture categories. Theconsent form for participants, which describes the project andconfidentiality issues, as well as copies of both the Minnesota JobSatisfaction Questionnaire (identified as \"Questionnaire 1\"), andthe Culture Inventory (identified as \"Questionnaire 2\") appear inAppendix 10. Attached at the back of the questionnaires is a pagerequesting some background information for each participant. Thisalso appears as part of Appendix 10.f) Distribution of the QuestionnairesSixty sets of questionnaires were distributed in each jointventure; return rates varied from 32 to 45 questionnaires in eachcompany. A stratified random sample of employees was identified tocomplete the questionnaires. Participant selections were done inthe following way:• An employee list or computer printout would be obtainedwhich lists all employees in the company for thegeographical location in which the research wasconducted. Names were in alphabetical order with no jobdesignation listed. This list would include employees at60all levels in the organization from production workers toexecutives.• I went down the list beginning with the first name andselected names at equal intervals. For example if therewere 240 employees in the company and the distribution ofquestionnaires was 60, I would select every fourth name.If there were 2400 employees in the company, I wouldselect every fortieth name.• The questionnaires were placed in an envelope with theemployee's name on the front. An envelope with my nameon the front c/o the HR department, was included with thequestionnaires in order that the individual could placethe completed questionnaires in it, and return thequestionnaire with confidentiality of the contentsensured.• Questionnaires for employees were bundled together byunit, division, or area, and were usually distributeddirectly to the employee by the supervisors for the area.• Envelopes were to be returned to either the supervisor(who would pass them to me), or through the internal mailsystem to the HR department.g) Guide to Human Resource Management PracticesThe Guide to HRM Management Practices is found in Appendix 11.I developed the guide for use to identify HRM practices whichoperate in the areas of planning, staffing, performance appraisal,reward and training. Information from the HRM Guide is intended toeither confirm or expand information from other sources related toHRM practices as they operate in each venture.61The HRM Guide was adapted from Schuler (1987) related tovarious human resource practice orientations. I was interested inthe development of this format because it has applicability for thedetermination of multiple values (i.e. the presence of both long-term and short-term goals, or that both a group and an individualorientation), which HR managers feel operate in the venture relatedto HRM practices. Although Schuler tends to use the HRorientations as unidimensional, I have presented the scales on theHRM Guide in a manner which allows participants to select theoperation of multiple values, if they felt this was the case. Forexample, a participant may indicate that planning is both formaland ordered, as well as informal and flexible. The dual aspect ofthe inventory is outlined in the introductory instructions toparticipants. The HRM guide is meant as an informal guide to HRpractices and has neither reliabilty or validity ratings.For the purpose of the research, the HRM Guide was completedby key managers in the HR departments. I felt that theseindividuals would be most familiar will all aspects of HR practice.If there were only one such designated person (as at OCG), then theHRM Guide would be completed only once in a JV. If there were morethan one HR manager, then the HRM Guide would be completed by morethan one individual. For example, at Triad, both the GeneralManager for HR (an American), and the Human Resources ExecutiveVice-President (who is Japanese), completed the HRM Guide. Thisallows for the presentation of multiple perspectives of how HRMoperates in the venture. In all cases, I was present and wentthrough the HRM Guide with the participant, to provideclarification when necessary.625. Analysis and Integration of the DataThe focus of data collection in this research is ondescriptive information, rather than on quantitative analysis. Asalready described, data were collected from documentation,interviews, questionnaires, and on-site observation. The multipleforms of information form a rich data base of HRM operations infour international joint ventures. Quantitative analysis of theMinnesota Job Satisfaction Questionnaire and the Culture Inventoryare meant to primarily extend or corroborate other data collectedin this investigation.The HRM themes which frame this investigation (i.e.communication systems, planning, staffing, training, reward andrecognition, and performance appraisal) were used to categorizeinformation from the interviews and other data sources. Inaddition, and related to the strategic emphasis in this project, Ialso used categories such as JV background (i.e. history of theoperation, parent roles), and the strategic orientation of thecompany (i.e. company vision and the steps taken to accomplish thevision), to organize the analysis of data. These additionalcategories evolved naturally from the interviews, and weredetermined based on the degree to which they were repeated inmultiple data sources (i.e. in documents, interviews etc.), andexisted in all four JVs in the investigation.Inevitably, I made some judgements as to what should beincluded as relevant data for the purpose of this study. Forinstance, and based on the review of the literature, I felt thatnational culture and corporate culture might be relevant to anunderstanding of strategic HRM policy and practice. Related to63this, implicitly a loose framework of issues which might betheoretically important existed, although as much as possible Iattempted to be open to new areas which were neither identified byme or others as directly relevant to the topic. Further, asalready explained, a reliability check was done on the interviewtranscripts to ensure that I had not subjectively omitted materialwhich was relevant to this investigation.More specifically, the analysis of the data occurred asfollows:• The questionnaires were analyzed using the method asdescribed in the preceding sections.• On each interview transcript, I noted the contentcategories related to HRM operations, JV background, orstrategic orientation of the company as described in thepreceding paragraph.• Documents were reviewed in the same way, using alreadyidentified HRM and company categories.• In a similar way, the journal was reviewed andcategorized.Following this preliminary step, data was organized within each JV,across the various sources of data. For example, within a singleventure, all information on training would be organized together inorder to form a comprehensive outline of training operations in theJV. At this point, all sources of data were used to create aunified analysis of HRM in the company. Convergence as well asinconsistency in the data were noted.In addition, the questionnaires were considered related toboth trends in the data for each questionnaire, and in comparison64to other information obtained in the JV. The HRM Guide was used todetermine levels of consistency of HRM policy and practice betweenrespondents in the venture. In addition, information from the HRMGuide was compared to other data. All sources of data were thencollectively woven into a profile for strategic HRM operations foreach joint venture. These integrated units form the basis of the\"Results\" section which follows.65PART TWO: THE JOINT VENTURESIntroductionThe four international joint venture companies investigated inthis research are all competitive, strategic players in the globalmarketplace. These joint ventures have been formed between twointernational partners, each from a different national culture.The ventures share very similar corporate goals and objectives.Without exception, in all the joint ventures in this research,employees strive to produce high quality products in theirrespective market sectors. \"Total quality\" programs operate toaccomplish this goal through 1. the reduction or elimination ofdefects, 2. continuous product improvement, and 3. the developmentof enhanced understanding of customer requirements. Employees areexpected to actively contribute to this process through theirinvolvement in quality management and product innovation.Depending on the reasons for the formation of the venture, theparents have either specialized roles, or strive to combine theirtechnological expertise in order to add value to the JV operation.Technology from the parent firms is transferred to the venture,depending on specific JV requirements.Although all four joint ventures are manufacturing operationsand share an orientation toward quality and service, they represent\"maximal variety\" in that they are in different industries, anddiffer in size and age. This variety therefore provides acomprehensive view of some of the strengths and challenges faced byjoint venture firms. Mayo Forest Products is a small lumbermanufacturing firm with 160 employees established in 1980. It66operates primarily as a subsidiary operation of Canadian PacificForest Products (60% owner), and is unionized. The other parent isMitsubishi (40%) which provides Mayo Forest Products with access tothe Japanese market.The second company in this study is OCG Microelectronics,which was formed in January 1991 and is a 50/50 partnership betweenAmerican (Olin) and Swiss (CIBA-GEIGY) multinational parent firmsin the microelectronic industry. OCG is very decentralized,relatively small (196 employees), and is nonunionized.The remaining two companies which participated in this studyprefer to remain anonymous. Consequently, I have renamed the jointventures as well as the parent companies. These names arefictitious and are not meant to represent any existing firm. Thethird company \"Optima\" was established in 1977 as a 50/50 equityventure between American and German parent firms. Optimaspecializes in fiberoptics and maintains technological linkageswith its German parent. This company is medium-sized (1250employees) and operates without a union.The final company to participate in this research is anautomobile manufacturing joint venture which was formed in 1985 andbegan production in 1988. \"Triad\" is a greenfield operation,unionized and relatively large (approximately 3000 employees). Itis the product of American and Japanese parent firms. An overviewprofile of the joint ventures in this research appears in Table 2.Throughout the following sections, various issues arereflected which consider the human resource management component asit operates in joint venture firms. Related to the emphasis whichthe management of these four participating companies place on their67employees, HRM is more often than not, linked to the strategicfunctions in the company. In addition, because each JV representsa union of diverse national and corporate cultures, issues relatedto the incorporation of parent and joint venture goals, values, andpreferences are apparent throughout these sections. They confirmthe contrasts, and the difficulty connected to the creation ofwhole and effective systems when more than one set of actors are onthe corporate stage. More specifically, and based on key themeswhich emerged from the investigation, HR policy and practice mightbe considered in the context of the following issues:1. The management of the JV-parent relationship - Does thetype of joint venture (specialized/value-added ordominant/shared); degree of partner compatibility; whichparent has the management contract; and the ability ofboth JV and parent managers to interact effectively havean impact on strategic HRM?2. The integration of HRM with strategic planning - How dovarious HRM practices such as communication, staffing,training, reward and recognition, and performanceappraisal contribute to, or limit, strategic JVobjectives? What is the role for the HR department inthis process?3. The development of a corporate culture in the JV - Whatare the influences (either from the parents or JV-based)which shape the norms and values as they operate in theventure?^How, if at all, are various subgroupsaccommodated into the organization?4. The establishment of organizational learning in the JV -68In progressive ventures, is there an emphasis onflexibility and learning, and if so what are thestrategic and tactical components of this process?5. The presence of diverse national cultures - Which HRpolicy is changed, if any, and what stays the same in thecontext of a joint venture when parents are fromdifferent national cultures?Finally, I have presented each company as a synthesis andintegration of data collected from each JV site. The data in thissection is based on interviews, documents, and questionnaireresults. This is a reflection of what the participants of eachcompany shared with me of their history and insights. I havereserved my own opinions and analysis of these events for thediscussion section.Plant Start-up/OCG^OPTIMA1991TRIAD1988MAYO1980; 1977TABLE 2JOINT VENTURE PROFILESReorganization reorg. 1988 (January) reorg. 1988Ownership 60% CPFP 50% CIBA-GEIGY 50% Bauer 50% Spartica40% Mitsubishi 50% Olin 50% Fiberop 50% Japan MotorsStrategy Orientation total qualityhigh employeemanagement ^involvementManagement Contract CPFP Olin Fiberop Japan MotorsNumber of Employees 160 196 1250 3000Union Status unionized non-union non-union unionizedMarket Sector lumber photoresists/polyimidesfiberoptics automobileJV Type (Specializationor Value-Added) specialization value-addedvalue-added specializationTechnology Transfer none bothparentsbothparentsJapanese70CHAPTER FOURMAYO FOREST PRODUCTS LIMITEDA. Joint Venture BackgroundI. History of the OperationMayo Forest Products is a sawmill nestled on the shoreline atNanaimo, British Columbia. Operational since 1980, the mill is ajoint venture between Canadian Pacific Forest Products Limited (60%owner) and Mitsubishi Corporation (40%). Mayo competesinternationally in the high quality lumber market. To ensuresurvival, the aim at the mill is to extract the greatest value fromevery log. This requires logs entering the mill must be accuratelycut to specified lengths, and be free of defects in order tomaximize lumber extraction and to minimize waste. The largestpercentage of cut lumber is exported into the quality consciousJapanese market. Eighty five percent of the lumber manufactured atMayo is sent to Japan, which represents approximately 4.5% ofJapan's total North American lumber imports. The remainder of thelumber is marketed to the United Kingdom, Europe and the MiddleEast. Mayo Forest Products has 22 salaried employees, (i.e. inadministrative or management areas), and approximately 160 hourlyemployees who are unionized members of the InternationalWoodworker's Association of Canada.The Mayo mill was designed in 1978 and constructed in 1979.According to the production supervisor, the mill was a combinationof a traditional Japanese mill and a North American mill design.During the mill construction there was high participation from theJapanese partner in both the engineering and design phases of the71project. When the mill began production in 1980 it was recognizedin the industry as one of the most progressive mills in BritishColumbia, and set a standard for quality requirements into theJapanese market. The plant came up to production quickly andmaintained the same level for about seven years. During this timeother competitors had outpaced the Mayo operation, productivitylevels had not improved, and the plant technology was becomingoutdated. The general manager noted the plant employees had littleor no training in the markets for which they were cutting, and noknowledge of the direction of the business. There was no long termplan, no formal quality control programs, and little informationwas shared with employees. Accidents in the mill had been steadilyincreasing.To counter this downward trend, Sandy Fulton who is the Vice-President of Canadian Pacific Forest Products (CPFP) in charge ofthe Mayo operation, hired a new General Manager for the mill in1988. The intent of this action was to create a majortransformation of how the mill operated. To assist in thedevelopment and implemention of this change, an outside consultantwas hired to work with the General Manager, as well as with otherstaff mambers at Mayo. Together they instituted a \"HighPerformance Management System\", which emphasizes setting andmeeting high quality standards; employee education and involvement;and statistical monitoring and communication of performance resultsto all levels of the organization. Part of the reorganization planinvolved refocusing the goals and roles of each of the jointventure parents. Mitsubishi was to concentrate solely on themarketing and on providing good product information; it would have72no direct involvement in the management of the site operation. Onthe CPFP side, Sandy Fulton assisted to refocus the managementpriorities at the Mayo operation. The mill manager was providedthe opportunity to operate more autonomously, while maintaining anenhanced focus on quality control and performance management in themill. To get first hand information about markets in Japan,employees at Mayo began to visit Japan, and talk directly withcustomers regarding product requirements.2. Parent RolesCurrently, the roles of the joint venture parents arespecialized and well defined. Mitsubishi has the marketingagreement to supply lumber products to the Japanese market.Canadian Pacific Forest Products handles the marketing of lumber toother destinations and has the management contract for the Mayooperation. This relationship has mutual benefit to both partners.CPFP is able to sell some of the logs that come off their holdingsto the Mayo lumber manufacturing operation, at fair market prices.Mitsubishi gains by having a continuous flow of high qualityproducts into their building material distribution systems.Both Mitsubishi and CPFP formally manage the joint venturethrough an advisory committee and the joint venture board. Theadvisory meetings occur quarterly or more frequently, and alternatebetween the Mayo mill site and Japan. According to Sandy Fulton,the meetings include representatives from Mitsubishi Tokyo,Mitsubishi Vancouver, CPFP representatives in manufacturing andmarketing and some of the management staff at Mayo. They meet tojointly decide a future focus for the mill related to product73development and people management, as well as to discuss otherplanning issues relevant to both JV partners. The advisorycommittee informs the JV board of issues for consideration. AsSandy Fulton describes,If there are other issues that need to be addressed atthe senior, and when I say the senior level, the board ofdirectors level, we would look to the advisory committeeas the vehicle to develop the direction or the consensusof what steps we're going to take. That might be ascomplex as negotiating the next agreements that willprevail for the next ten years in how the ownershipstructure is going to take, or what sales agreements aregoing to be, or log supply agreements or you knowgenerally the parameters in which the two companies ownthe operation. So any one of those issues that mightcome up would be dealt with either at the advisorycommittee level or in a subcommittee if you will of thoseindividuals. So those individuals at the advisorycommittee level play a very integral role in themanagement of the operation and dealing with any of theissues between the two owners. And that might not be soevident when you're sitting at the mill. You might notsee a lot of that.Sandy Fulton believes the advisory committee is responsive andreflects the requirements of each partner. The mill manager, MikeLow generally agrees with this analysis. Planning directives fromthe advisory committee and requests for major capital expendituresare approved formally at the JV board level. The JV board for MayoForest Products is comprised of 3 Mitsubishi members and 4 CPFPmembers. Sandy Fulton of CPFP is the chairman for the boardmeetings, which he describes as being largely \"ceremonial\". Theexecutive Vice-President of Mitsubishi Canada adds the boardmembers meet in these institutionalized meetings, but in additionthey meet frequently in other settings. The Mitsubishirepresentative suggests \"agreement, conviction or common interest\"in the joint venture are facilitated informally.74Although Mitsubishi is a 40% owner in the joint venture, CPFPhas the management contract through which it has the authority anddiscretion for how the mill is managed and operates. Related tothis, Mayo Forest Products functions like a wholly owned subsidiaryof CPFP with very little evidence at the mill level it is a jointventure. This analysis is supported by some of the comments madeby Mayo employees. One employee volunteered he worked for CanadianPacific Forest Products and added, \"everybody here works forCanadian Pacific Forest Products. If someone at Canadian PacificForest Products is not happy with your performance, then you don'thave a job. If somebody at Mitsubishi's not happy about yourperformance, they have to live with it.\" Another employee notes hefelt Mayo is treated like a division of CPFP. In fact, frequentperformance comparisons are made by managers in the mill betweenthe Mayo operation and other CPFP mills in the area. Although theemployee handbook cites Mayo is a JV between Mitsubishi and CPFP,few employees seem to understand the implications of thisrelationship. \"The Mitsubishi presence in this mill is so limited,it's almost nonexistent to the crews\" one mill manager remarked.Although there are no Mitsubishi employees transferred to the Mayooperation, some of the mill managers have previously worked withCPFP.Within the network of relationships which tie the Mayo milloperation to CPFP, Sandy Fulton views Mayo \"almost like a totallyindependent company, but overlaid with the rest of the company\"[CPFP]. He continues,In the management of it [Mayo] we manage it notappreciably different than our other sawmills. And whenI say that we have a manager there and while he's a Mayo75Forest Products general manager, I personally view him inthe same way as I do the general manager of Ladysmith andthe Tahsis sawmill. He conceivably might have a littlebit more latitude in that he serves two masters not justone...Given this parameter, Sandy Fulton provided the GeneralManager at Mayo with a mandate to operate as autonomously aspossible, and told him \"to manage his business unit and feel freeto make whatever changes are required.\" To a great degree MikeLow, the General Manager at Mayo, has been able to make changeswhich he felt were necessary for upgrading the mill and creating anew management style. At the mill site there are no visible signsMayo Forest Products is related to CPFP. As Mike Low points out,\"we have our own corporate identity, our own colors, our own policymanuals. Let's take advantage of that. We can do anything wewant. I write the policies for the policy manual and am signingofficer for the company.\" Alternately, it is the Mitsubishipresence which is more visually represented. The company sign atthe front of the building, and a sign over the resource centre bothare in Japanese and English. In the front lobby there are twoJapanese dolls in a glass case, gifts from Mitsubishi Corporation.However, because the reporting link for Mayo is to the CPFPparent, Mike Low requires CPFP approvals through the Vancouverregional office, as well as the Montreal headquarters office ofCPFP before making certain decisions. This is the case in thehuman resource areas for staffing and compensation practices, whichrequire approvals from the Montreal office. In all instances,approval is required before hiring anyone and for allocating salaryincreases. Mike Low finds this frustrating and says, \"it'sprevented me from doing a proper job of recognizing my staff. It's76prevented us from doing a proper job of organizing the staff asthings change and evolve. We've done a poor job of properlycompensating people.\" Mike notes he does have some unapprovedpositions on the payroll for which he can't seem to get approval.These people are being paid on an hourly basis under a \"hiddenpayroll\".3. JV Benefits and CostsThere are both benefits and costs to operating in a jointventure in which there are two large parent companies involved.Mike Low reflects there is a \"tremendous amount of clout\" pluscapital and power provided from the JV union. This ensures a levelof security for the venture. Alternately, dealing with two hugecorporations is difficult in order to get things done. Mike Lowsaid if either Mitsubishi or CPFP disagree on an issue it's \"almosta hopeless cause.\" Despite some of the difficulties of balancinga joint venture relationship, the key players seem to feeloptimistic about the progress at Mayo, and have activelycontributed to the wellbeing of the venture. Sandy Fulton notesthe importance of a good relationship between the two partners, andadds he had personally invested a significant amount of time andeffort in making the venture successful. He said \"it was importantto me to get to know all of the people in the whole process, fromthe most senior individual to everybody that was involved in themarketing of the products for Mayo\". Mike Low was instrumental inaltering the path the mill has taken. In an address to the staffin the company newsletter (March 1991) he writes,To me, Mayo is as unique as our people. Each individual77with an astonishing variety of backgrounds and interests,and yet, each day we come together, as one team,powerful, dedicated and satisfying to work with. Withoutpeople we would not have growth, and without growth,there would not be continued success.A Mitsubishi board member, Mr. Tsuchiya concurs. He stresses theimportance of communication among the partners, and adds at alllevels of the joint venture they are able to discuss issues. Mr.Tsuchiya comments both partners see Mayo as their \"baby\" and bothMitsubishi and CPFP include each other at their board meetingdinners.The success of Mayo Forest Products has varied over the years.It currently represents an exemplary company and multipleindicators attest to the management and marketing success of theorganization. In the first quarter of 1991, Mayo had its best eversafety performance per person day; quality was up and productioncosts down; and the mill production level was above budget andabove the 1990 performance level. Mayo is recognized in Japan asone of the top five sawmills in North American for quality lumberproducts and in recent months, Mayo was awarded the Japanese lumbergrading certification. This signifies lumber products from Mayomeet the requirements set by the Japan Federation of Lumbermanufacturers, and are preferred over non-certified products byJapanese lumber buyers. The lumber bypasses inspection on arrivalto Japan. This certification is the only one awarded in Canada,and the second in North America. Based on these distinctions andsuccesses in the quality area to date, Mayo Forest Products hasapplied for the 1991 Canada Awards for Business Excellence in thequality category.78B. Strategic Orientation1. The VisionIn 1988, as a preliminary step in the reorganization of theMayo operation, Sandy Fulton at CPFP introduced Mike Low to theRydberg Levy consulting group. Sandy Fulton had been involved withthe consulting company for the previous eight or nine years as aresult of working on other projects with them. One of theconsultants worked with Mike Low for a period of approximately oneyear before he came in to work with the other managers andemployees at Mayo. Initially, the consultant worked with themanagement staff to establish a focus and vision for the future ofMayo Forest Products. Later, hourly employees were involved insimilar sessions to determine goals and focus in their own groups.In one instance, twelve of fourteen filers attended a whole daysession at a local hotel, to construct a vision and goals as to howthe file room should best operate. To enact a new strategy andvision for Mayo Forest Products, major changes in staff wererequired at the management level. Of twenty-two managers currentlyin the operation, all but three or four were hired by Mike Low aspart of the reorganization plan. Mike has served as a champion forthe reorganization plan at Mayo. He is dedicated, energetic, andperceived as fair by staff at all levels of the company. Hisinfluence and initiatives are strongly felt, and greatlyappreciated by the majority of employees. Many of the staff atMayo specifically note the important role which Mike Low has had inthe reorganization of the mill operation.The vision for Mayo Forest Products is reflected in the79company mission statement which is located in the front lobby ofthe building. It reads,We at Mayo Forest Products will be the highest quality,lowest cost producer of Japanese wood products in thePacific Northwest through bringing together innovativepeople, raw materials and technology to produce a productthat meets our customers requirements every time.Mike Low points out the mission statement ties together people, rawmaterials and technology. Substatements were developed to expandon the above mission statement. These include the Mayo Statementof Quality which is, \"we will meet our internal and externalcustomer's requirements every time\" [his emphasis]. The Mayophilosophy for how people are viewed focuses on a need to \"build astrong, committed and dynamic team that will carry this plant intoand through the 1990's\". The team concept is an importantcomponent at Mayo, and is reflected on every page of the company'spost-it notes in the phrase \"quality, a team effort\". Numerousreferences to the \"Mayo team\" are sprinkled throughout the companynewsletter. A team approach is cultivated partly through aconscious effort to build a cooperative relationship with the unionand its members. A recent step toward this goal involved theinclusion of a union employee on the selection panel for hiringthirty new employees to the company payroll.2. The RequirementsA cornerstone of the Performance Management System in place atMayo focuses on the involvement of employees in decision-making,regarding equipment and operations for which they are responsible.Employees are encouraged to participate in problem-solving andproblem prevention. In order to make informed decisions, the80communication of accurate and timely performance information toemployees about how the mill is operating is imperative. Opencommunication and the education of employees is central to theprocess. These goals are accomplished by:1. Identifying accountability - Clear areas of responsibility andaccountability are determined by employees. Based on group goals,performance indicators are established and employees monitor theirperformance on an ongoing basis.^Performance is measured inquantitative terms which reflect production outputs or cost levelsin the mill. The term \"ownership\" is frequently heard around themill, and this refers to a decision by employees to decide the partof the business for which they are responsible, and to make itbetter.2. Involvement - A communication system has been established asa means of getting information to multiple levels of employees inthe organization. This system includes the use of meetings,bulletins, graphs and other forms of posted performance data, anda company newsletter. Performance indicators are monitored inorder that problems can be detected and corrected at an earlystage. Problem areas are discussed by the group responsible for ajob function. These groups, the Quality Improvement Teams (QITs),identify a specific problem and then follow-up changes areimplemented by a Corrective Action Team (CAT). Employees areencouraged to provide suggestions and ideas for continuousoperational improvements. Upgraded training manuals and programsassist employees to enhance technical skills.3. Recognition - Rewards and recognition are given to employeesfor their efforts and contributions. Recognition might range from81verbal praise to a variety of tangible rewards available such asgift certificates, jackets, or trips. All Mayo employees areeligible for these rewards, and based on employee accounts, manyforms of recognition have been distributed.Mayo Forest Products aims to aggressively compete in aninternational market. \"Going for the checkered flag\" appearsthroughout the company newsletters, and symbolizes in 1991 thecompany will drive forward as if they \"are in the Indy 500 to win\".To succeed, Mayo has decided part of its mission is to focus onquality and to gain a better understanding of the customer'srequirements. A variety of tactics have been instituted whichallow employees to better understand the Japanese market for whomthey are cutting. Mike Low determined the best way to getinformation of the customer's needs was to go and talk to them.\"We directly built that relationship with the end users\", heremarked. Until three years ago there had only been a few seniorpeople who had been to Japan. At last count, nine or ten of themanagerial group had been to Japan, some more than once. Inaddition, five of the hourly employees in the mill have been toJapan to study firsthand the grades and packaging standardsrequired in that market.Apart from these trips, two people in sales and production atMayo speak fluent Japanese. This allows them to talk with thecustomer directly, in order to get a clear and accurate picture ofthe market in Japan, without reliance on interpreters. Althoughthere had been drop-in Japanese lessons offered to employees for aperiod of time, lagging attendance led to their termination.However, every morning in the production meetings there is a82Japanese phrase of the week which is repeated aloud at the end ofthe meeting. At present, training courses are not offered onJapanese culture and the Japanese market, but this possibility isunder consideration. At various times, the General Manager hastalked to the crews about the importance of quality requirements inJapan.It is these underlying tenets which frame the philosophy forthe company. They permeate how jobs are viewed and how work isaccomplished at Mayo. These statements reflect a desire thatemployees at Mayo manufacture quality products. Subsequently,systems have been created to enhance productivity and to reducecosts; employees are to be involved in this process. To meet agoal of employee involvement, employees are provided withsufficient information, education, and training in order that theycan perform in ways which emphasize quality. Much of the strategicorientation in the company underscores the human resourcephilosophies at Mayo. This includes the amount and kind ofinformation shared with employees, policies for worker recognition,how staffing is undertaken, training initiatives, and the way inwhich employee involvement in the operation is viewed.C. Human Resource Management at Mayo1. The HR Departmental RoleHuman resource management operates at two levels at MayoForest Products. Personnel issues for salaried staff, (i.e.administrative and supervisory employees), are coordinated througha personnel administrator in the regional office of CPFP.83Primarily this involves the approval of salary increases orstaffing requests before sending them to the headquarters officefor final approval. HR policies for salaried staff at Mayo arebased on CPFP policy and directives. Personnel managers at boththe mill site and the regional office identify HR planning astending to be formal and ordered, based on a long-term focus, andintegrated with the plans of other departments.Human resources issues which relate to the hourly (unionized)employees are handled by a Personnel/Safety Administrator locatedon the mill site. All salary, grievance, promotion, and trainingconcerns are outlined in the union contract. As indicated by thetitle, the role of the personnel/safety administrator is largelyfocused on maintaining a safe work environment. Gale Limmert, thepersonnel/safety administrator remarks safety is 50% of her job.Additionally, much of Gale's role revolves around understanding andinterpreting the union master agreement. Describing the HRfunction at Mayo, Gale observes \"they [CPFP] believe that it's moreof an administrative function where one person sort of acts as amonitor, resource person, even just in a clerical function makingsure that everything is documented and filed\". The influence ofthe performance management systems which pervade the Mayo operationand include training, recognition, and employee involvement, havebeen created by Mike Low, in conjunction with his management teamand the group of consultants. The performance management systemwas not initiated in the personnel department. Instead, and basedin part on CPFP philosophy, supervisors are designated to have theprimary responsibility for working with employees in the humanresource management areas. The personnel administrator at Mayo84describes,A lot of the personnel functions are handled by frontline supervisors on a one to one basis. CPFP believesthat it is more of a supervisor's function to deal withhis people than somebody that is removed sitting back inan office. I try to get out in the mill as much as Ican, but I'm really not the front person. And so thesupervisors basically do most of what you might call thehuman resource, the one to one.In this role, the personnel administrator has little directinput into policies and planning. However, the centrality of thefunction is indicated by the fact there is an adequate budget. Thecontroller stated if there was a need for funds in the personnel orsafety areas then the necessary funds would be allocated.Gale remarked her role had changed little in the last twoyears, but that she would prefer to be more proactive than reactivein the accomplishment of HR activities. As with the other managersin the mill, she is very busy and finds there is little extra timeavailable in order to make improvements to her role. Related tothis, some employees specifically note the personnel function isoverloaded. A number of the production staff expressed they wouldlike greater access to Gale, and that it would be an advantage tothem if she could spend more time in the mill attempting to betterunderstand worker concerns.2. Employee Involvement Systemsa) Sources of Information ExchangeAn important way in which the company accomplishes its goals,is to concentrate on maintaining updated statistical information onmill performance indicators. This information is passed toemployees at multiple levels of the organization. Performance85information is available from fact sheets posted on bulletin boardsevery morning which highlight key indicators, including financialresults. The monthly company newsletter, the \"Mayo Update\"provides departmental summaries on performance, quality andproduction updates, marketing information and safety statistics.During a daily morning production meeting which lasts for fifteenminutes, managers and supervisors share information on millactivities for the 24 hour period. Statistical indicators areprominent on a large white board at the front of the room. Safetyissues are a central topic at these meetings, and are taken veryseriously by all staff. The production meeting is followed by afifteen minute maintenance meeting during which staff morespecifically examine activities related to maintenance and repair.Departmental managers attend a weekly meeting and prepare inadvance a one-page fact sheet for distribution at the meeting.This sheet outlines weekly performance for each department; citingfacts, figures and future action plans. A weekly superintendent'smeeting is attended by managers who discuss mill issues for thatweek. Crews have weekly meetings with their supervisors duringwhich information from the management meetings is shared, or otherissues for the specific crew are considered. In the crew meetings,actual performance is compared to goals the group has set foritself. As safety is a primary concern in the mill environment,there are monthly safety meetings held with supervisors and crewsduring mill production time. Safety statistics are also maintainedas part of the monitoring process at Mayo. Finally, there aremeetings held as required, to inform employees of capitalimprovements, product development, equipment changes, and training86programs.It would appear most employees appreciate the amount ofinformation transmitted to them. All three hourly workers who wereinterviewed for this project, said they did get information throughthe weekly meetings and from bulletin boards. As one employeecommented, \"everybody can see where we stand\". However, theproduction supervisor noted information-sharing may have started to\"slip a bit\" and there was less information getting to the crewsnow than in the past. The company has countered this trend by theaddition of junior crew supervisors, in order that each supervisorcan spend more time on an individual basis with crewmembers.From management's perspective, keeping up with the informationflow is time consuming. Manager's have mixed reaction as towhether all their meetings are necessary, and to what extent theyare adequately informed. Some managers felt there are about theright number of meetings, and that the meetings are all useful.Other managers thought the number of meetings could be reduced, orat least the length of meetings be shortened. One individualcommented due to the large number of structured meetings,spontaneous communication was lacking in their group. Disagreementexists among managers as to the openness of shared information.Certain managers and supervisors suggest the system is open andthere are \"no secrets\". In other cases, a supervisor commented hefelt there is both a formal and an informal information systemoperating, and it is difficult to know who would get whatinformation and why.The focus on information sharing, including performance data87and statistics, keeps management and other employees continuallyupdated on mill operations. This information is intended toprovide employees with current performance data, in order that theyknow of problems or accomplishments in specific work areas. Onegoal of management is to encourage employees to strive towardattainment of the highest quality product possible. This objectivemay be accomplished through Corrective Action Teams, or throughimproved decision-making based on statistical and performanceindicators provided to employees. Workers are expected to beaccountable for their work performance, and to be both effectiveand efficient in what they do. Statistics outline performancehighs and lows for each department or crew in the mill.To illustrate this process, one of the shift supervisors notedthere had been some problems in the trim area. To monitor andcorrect the problem, members of the crew were given performancefeedback every two hours. A Corrective Action Team was initiatedand employees were asked for their ideas of how to create asolution. The supervisor adds it is important to use the crew'sideas as they \"are the experts on the job\". In another instance,the production supervisor writes in the company newsletter that thecompany has continued to get a \"number of innovative ideas fromvarious employees\" for improving the production area. A sevenperson \"Recovery Team\" had been set up to formulate action plansrelated to improvement. In the same newsletter, the qualitysupervisor indicated package quality was down and requestedsuggestions or ideas from any employee on how to enhance theappearance of the product. Permission is given to make mistakes inorder to learn. One manager quoted Tom Peters who said \"go out and88make a bunch of mistakes\". He then remarked, \"we make a bunch ofmistakes and we make them quick\". There is a quarterly award forthe person who has made the biggest mistake. He said \"doingsomething different\" is one of the mottos at Mayo.In an interview with an hourly employee who works on thechipper, she says management \"takes what they [union employees] saypretty seriously\" and adds in the crew meetings workers makesuggestions for improvements. The development of employeeinvolvement has been an ongoing process at Mayo. The productionsupervisor, Eric Calverley comments management has \"struggled withgetting the people to accept this [participatory] way of managing.They're very suspicious about it. They don't understand why are weasking them to be involved in the decisions. They see somethingvery suspicious about it. And as a result they don't reallyparticipate that well\". He adds over the last four or five months,the hourly employees have begun to believe management does wanttheir suggestions and ideas. As a result, the productionsupervisor says the workers are offering more suggestions as to howto manage at Mayo. Worker's ideas are \"passed up the line untilsomething is done about it\". In some cases the ideas are notfeasible, but managers or supervisors make an effort to \"get back\"to each employee regarding his or her suggestion. Eric adds, \"thefeedback part of it is the key part of the management style...Itdoesn't really matter how ridiculous or how costly the idea is, youhave to get back to the people...\"The above examples indicate a commitment on the part ofmanagement and employees to involvement at Mayo. According to somemill staff, this has not always been the case. One hourly employee89relates \"we've got some ideas but nobody wants to listen to us\".His view is that management will listen to ideas but they gounused. One manager substantiates this claim by saying employeesare probably not listened to sufficiently, and this was not likelyto improve due to the amount of time required to listen toeveryone's suggestions. Mike Low, the General Manager wasspecifically singled out as someone with whom employees could talk.One union employee expresses any worker could make and appointmentand talk to Mike Low to \"let steam out\".b) Shifting Roles for EmployeesAn increase in the level of employee involvement in the millshifts the roles of hourly employees, managers and supervisors, andalters the traditional relationship between union and management.Not everyone is comfortable with the new arrangements. Thepersonnel administrator comments,There's a real conflict when you get into a unionenvironment because people still want to be treated as anindividual and yet the contract does not really allow forthat. As soon as you treat someone as an individual anddeviate even slightly to accommodate their needs you runinto the thing that you're not consistent with everyone.And it really does create a conflict when we [management]are trying to to entrust certain responsibilities andaccountabilities out in the mill at the floor level.That's not traditionally done in a union environment.[In] a union environment, they are the workers and wemake all the decisions as a company. And we want them tomake decisions. We're looking for added value from ourlumber and we want them [the workers] to be accountablefor the grades...We are entrusting that responsibility tothem. We get a little conflict from that because that'snot traditionally what they want to do. They just wantto do their jobs and go home at night. So there'sconflict with the new style of management and thetraditional [style] of what would be perceived as a unionemployee's role.Some workers are very willing to accept the additionalresponsibilities. Other workers have more traditional views of the90work role. To some extent, there is mistrust by union employees ofthe motivation behind manager's actions. The production supervisornotes a majority of the unionized employees are in favor of greateremployee involvement; and he comments, \"we have a lot of people whosee what we're trying to do and they're helping us. We'll run thisplace almost as a cooperative between management and union. Thatwill be a turning point for us. We're getting close.\" Recently aunion employee participated on the hiring panel for recruitment ofthirty new employees to the mill. This was a an important step forincreasing union involvement is decision-making in the mill. Theunion employee on the selection team addressed a group at theunion-management meeting, saying there were no problems or secretswith the new selection process. In another instance, the resourcecoordinator for training programs is a union employee. Theresource coordinator relates his role is unique in that it spansunion and management, and adds it is important for him to be ableto relate to both union and management concerns, and to focus on ateam approach. The resource coordinator adds he has littlepatience for \"them and us\" distinctions. One of the crewsupervisors thinks employee morale is improved and that workers arebeginning to trust management more. Of the three hourly millworkers interviewed in this study, two felt union-managementrelations were good. The other employee said it would not bepossible to trust management entirely, although this individualapproved of the trend and focus of the policies in practice atMayo.Part of the difficulty of instituting the performancemanagement system revolves around a shift in power from management91and supervisory staff to unionized employees. Information isperceived in the mill environment as power, especially bysupervisors. The power dynamics are not well hidden from view atMayo, but were observed and commented upon by several of the peopleinterviewed for this project. A mill worker relates management didnot want to share their knowledge with workers because this meantgiving up some of their power. A manager substantiates thisstatement by revealing supervisors had been choosing theinformation they pass to employees, depending on what they considerimportant. As a result key pieces of information were not alwayspassed to production staff.The General Manager, Mike Low, is aware of the difficulty inattempting to shift power to employees. Some of this difficultystems from middle managers, who feel that to share information withemployees means to give up control. To use the words of theGeneral Manager, he says middle management \"feel they're giving uptheir authority or their control and that scares me becauseobviously they still don't understand all the principles that we'reworking with\". Mike Low cited as an example, an employee whopresented some ideas at a management meeting, and subsequently wascriticized by one of the managers. This is only one signal whichindicates some managers have problems with the employee involvementconcept, and Mike Low has taken steps to remind staff that sharinginformation is \"not about giving up control or getting soft\". Atthe time of the interview with Mike Low, he was involved with theconsulting group to develop further training for supervisorsrelated to the goals of enhanced employee involvement. Trainingwill focus on communication skills, setting up self-managing work92teams, and the supervisor's role as coach and facilitator in thisprocess.Although union-management relations at Mayo seem relativelyconciliatory, the idea of information as power remains an issue inthis area as well. When the performance management system wasfirst instituted, management decided to bypass the plant unioncommittee and to go directly to the workers with performanceinformation on how the mill was operating. This policy wasshortlived. As one manager describes,In this latter year we've decided that bypassing theplant committee is not necessarily in our best interestsin that they maintain a certain status out in the millwith the crew members. It's an elected position and bybypassing them, we do ourselves some harm. So now we'redoing both. We're having regular plant committee-management meetings monthly. We've just implementedthat. And through our information meetings everyTuesday, information is being passed to the crew members.We like the idea of passing the information directlybecause once you get to an interpretation some of thefacts can change.One of the consultants to the mill elaborates on this themeand describes when he first began working at Mayo, the union hadall the political power. According to him, the union had access tomuch of the information circulated in the mill, and would pass itto the workforce with varying degrees of accuracy. For example,workers could go to the union and get information on whether therewould be a shutdown, or how much money the mill was making. Theconsultant continues at this point in the company history, thefront line supervisors had no power. When the focus on informationsharing began, power as information was shifted to the supervisorsand the mill workers, who then had increased access to updatedinformation related to most facets of the mill operation.93Initially the crews were sceptical of the sharing of informationand perceived \"they're just trying to snow us under\", and \"they[management] want something\". Related to this scepticism about\"real change\", around 1988 a flurry of grievances was initiatedagainst management, and this form of union reaction continued forapproximately a year and a half. The current relationship betweenthe union and management is much more cooperative.c) Employee Opinion of High Performance SystemsAlthough the Performance Management System and the relatedpolicies for sharing information have afforded the company benefitsin terms of enhanced productivity and performance, some staffquestion the rigorous attention to performance indicators andstatistics. One manager remarks the performance management systemis numbers, and in some instances can be manipulated. He adds,To me numbers are supposed to be used as something tohelp you. They can also be manipulated to make thingslook good and I have a real problem with performancemanagement if it starts affecting how you run a mill. Ifit affects it in a positive way where you're using theinformation as a tool, to try to better things, but whenyou start using that to start to modify your behaviorwhether it's how you load lugs at the trim table orwhatever, so that your numbers look better for all thewrong reasons, I have a problem with that.Another manager notes too much emphasis on numbers can potentiallylead to losing focus of the ultimate goals. He describes,People lose focus of why they're doing it...Get the bestyou can, and try and meet that goal. And they never stepback and say what are we doing...Sometimes thesupervisors loose sight of why and how they are supposedto be implementing this performance management. . . they puttoo much emphasis and focus perhaps, on the goal and onthe charts and trying to achieve that goal, and I don'twant to say at all costs, but almost to that point. I'veseen it before. I get a little bit of an indication ofit here, people really, really push for that target...Atsome point it gets to be a little self-defeating, whenthey're supposed to be encouraging the employees and94motivating the employees.To a degree, some of the supervisors in the mill do have apreoccupation with adherence to statistical criteria. One linesupervisor comments a major challenge for supervisors is to focuson numbers and to improve production statistics. In addition,performance management systems implicitly have the potential forcompetition among individuals or crews.^Related to thispossibility,^a manager remarks \"when you're paying so muchattention to figures, safety stats, production stats, quality; whenyou're actually appointing a figure to how well someone stencilleda package, then again there is a certain amount of competition, acertain amount of conflict created\".However, Mayo employees like the challenges of bettering theirindividual or group performance goals. Competition among thevarious crews was viewed as positive. One hourly worker commentsthe competition between crews was \"like a baseball game, and youwant to win\". Another hourly employee agreed with this assessment,as did the production supervisor. The supervisor explains part ofthe reason competition between crews or individuals is viewedpositively is because the company does a good job of recognizingemployees for excellent performance. The production supervisordescribes,If we were to just go out and compare one shift'sperformance in a given area to another, I think we'd havea problem with it. But when we see some superiorperformance we go out of our way to recognize a personand that's anywhere from a pat on the back to maybe somemonetary gain or a gift certificate...In the beginning,yeah, it was pretty tough because we were comparingpeople and they'd never had that done to them before.And we're saying well this guy's a 6, and you're only ata 5 so maybe you'd better do something about it. But nowthe guys are turning it around and saying I'm only at a955 how do I get to be a 7...I haven't seen any what you'dcall fallout from it.3. Reward and Recognitiona) RewardsSalaries comprise the primary form of financial compensationat Mayo. The monetary reward system for hourly employees is fixedby the union contract, with built in adjustments for salaryincreases.^Mayo does not have a pay for performance systemoperating for hourly employees.^Management staff have salaryreviews which occur on an annual basis. A percentage range forsalary increases is set by Canadian Pacific Forest Products butadministered by the General Manager at Mayo. Managers meetindividually with the General Manager and he informs them of thepercentage of raise which they will receive. The amount ofincreases is kept secret and each manager who was interviewed hada different perception of the amount of increment possible. Thereis little discussion related to the reasons for the salaryincrease. As one manager describes, the salary and promotionprocess is based on \"pretty much of a gut feel\". There are fewformal guidelines. Another manager notes salary increases are\"done on the manager's perception of how you're doing. There isnothing concrete really about it\".b) RecognitionThe recognition system at Mayo is well developed, and offersnumerous sources of appreciation for employee efforts. Therecognition process is meant to both encourage employees to be moreinvolved in the mill operation, and to provide tangible or96nontangible rewards for continued efforts. As long as the rewardsfor union employees are not large monetary amounts, they do notinterfere with compensation guidelines of the union masteragreement. Recognition takes many forms at Mayo, and may includeverbal praise, dinners, trips, trophies, jackets, thank youletters, gift certificates, or donuts. When the saw filingdepartment achieved seven years without a lost time injury, thedepartment supervisor sent seven long stemmed roses to the home ofeach member of his crew. Also in recognition of a job well done,the filers went to Portland to look at some machinery. At Mayo, itis considered the supervisor's role to recognize his crew; and onesupervisor expresses it is very gratifying for him to be able toreward members of his group. On one occassion, the supervisor wasable to recommend one of his crew for a complimentary weekend at aluxury hotel, in recognition of work well done. Retirement dinnersare organized for employees, and there are Christmas parties andbarbques for all staff.As safety is very important in the mill, a safety program wasinitiated under which four times a year all members of a crew areindividually presented with a fifteen dollar gift certificate, ifthere have been no lost time accidents for that crew. This programreceives mixed reaction from hourly workers. Although the programwas intended to encourage people to work safely, some employeesview the certificates as a \"bribe\". Although there is a genuineconcern for safe working conditions at Mayo, reductions inaccidents, especially serious accidents, also means fewer workmancompensation claims, and ultimately lower insurance premiums forthe mill. One possible side effect of rewarding employees for97fewer accidents is that minor injuries are not reported. However,based on the reactions of both supervisors and hourly workers theytended to think this was not the case, and probably as manyemployees were going to first aid as before the program began. Inone instance, an hourly worker did describe an alternativeperspective. He relates,I got a little bonk on the head and I went to first aidand got it checked out there and then I didn't get myfifteen dollars. And that made me mad. I don't knowwhy, it just bugs me just because I went to first aid andeverybody else got their fifteen dollars. I don't likethat incentive...Everybody is then hiding their littlesprains and bruises.The employee adds in the future he will not go to first aid undersimilar circumstances. This same worker feels publishingindividual or crew recognition for safety in the companynewsletter, is likewise a disincentive to report safety incidents.The recognition system is not lip service at Mayo, but isenacted at every opportunity by managers and supervisors. Inaddition to performance recognition in the \"Mayo Update\",expressions of praise are often heard at the many meetings attendedby managers, supervisors and other employees. Recognition is oftengiven to individuals or groups in the morning production meetingsor in management meetings for work well done, or for theaccomplishment of a \"team effort\". A manager may comment on theexemplary work of specific members of a department. On oneoccasion, everyone at a manager's meeting clapped in appreciationof the achievements of one of their group. Although managers inthe company make an effort to recognize performance, there areobviously exceptions. One hourly employee remarks he receives onlynegative feedback. Another notes there is little ongoing98recognition for work performance or the suggestion of new ideas.Recognition of employees is regarded as one of the mostchallenging elements of the Performance Management System.Ensuring recognition is both appropriate and sincere has been adifficult task for managers and supervisors. One manager remarksemployee recognition has to be \"meaningful\", and that this isdifficult to accomplish when individuals differently view thereward and recognition systems. Employees have a wide range ofreaction to recognition systems at Mayo, from \"if I'm going to getsomething for free I'll take it\" to \"there's no way the company'sgoing to buy me off\". One hourly employee believes recognitionprograms are \"pretty genuine\" and management does a good job inthis area. A second hourly worker comments he would prefer moreteam recognition, and finds individual recognition embarrassing.Employees need to understand why recognition is offered.Several supervisors remarked if a lower performing individual ispraised for work improvement, then an effort should be made torecognize people for continued good work performance as well.Another manager notes that in an attempt to focus on a recognitionsystem, employees are sometimes rewarded even though they did notperform well. The inconsistency in this action makes the sincerityof the system occasionally suspect. The General Manager states hisview that \"the appreciation for people is paramount and toencourage and recognize improvements in performance and never,never, try to buy performance\". Despite the pitfalls inherent inthe development of a recognition system, as part of theorganization's value system, managers and supervisors look foropportunities to recognize individuals or groups for performance99and effort. In general, employees at Mayo appreciate theendeavours by management to offer encouragement and benefits fortheir contributions to the organization.4. Staffing and PromotionRecruitment of hourly employees is based on the unioncontract, and preferential hiring is given to workers who belong tothe IWA union. The personnel administrator mentions interpersonalskills would be considered, but only if two workers possess thesame skills and qualifications. Managers at Mayo prefer workerswho can be team players. Although traditionally a male workenvironment, there are currently eight women working in the mill ona variety of production jobs, from strapper to chipper. Anorientation program and an employee handbook are provided to newemployees which outline mill operations, as well as the millemphasis on safety, quality and people. The handbook provides abrief history of Mayo and mentions the joint venture arrangement ofthe company. The orientation sessions are presented by theresource centre coordinator who is also responsible for thecoordination of other training programs in the mill.The selection of hourly employees is done by a panel. A unionemployee as well as the personnel administrator and one or two linesupervisors are involved in the hiring decision. Each member ofthe selection panel has a vote as to whether the candidate shouldbe hired. Promotion is strictly by seniority. Availableproductions positions are posted in the mill, and internalcandidates are selected. Hourly workers have the opportunity tomove into supervisory positions, and this has occurred on two100occasions.The selection of managers primarily is done by the GeneralManager. Managers are hired who have broad skills and potential todo a job. Generally, the group of managers are considered to beself-starters, aggressive, and able to operate on a relativelyintuitive basis. Previous experience in a particular skill area isnot a necessary requirement. Staffing requisitions go to theregional office of CPFP, and then to the headquarters office inMontreal. The General Manager muses he is not always successful inobtaining approvals for staffing. There are no job postings orwritten job descriptions for managers. Career path information isnot readily available, although it may be obtained from theregional office of CPFP. One manager comments he does not know howpromotions operate.In some cases, when supervisors are hired for a specificdepartment, recruitment will involve the General Manager as well asa departmental manager. One manager remarks both a candidate'sskill and personality are considered. He describes,If we see a quality in a person that makes them adesirable [candidate]...good personality, reasonableintelligence. When we go to hire staff here we don'tever sit down and look at a guy and say does this guyhave grade 12 or university education, does he havefifteen years experience in the business? We never lookat that side of the person, we look for good peoplefirst. And then we'll train the people to do what wewant. I guess we can train people to do that, but wecan't train people to be good people.The Vice-President of CPFP, Sandy Fulton hired the GeneralManager for Mayo Forest Products. Related to the qualities whichthe Vice-President thinks are important for a joint venture GeneralManager, he suggests,101You must recognize you have two owners. Even if one isonly five percent ownership, it's still an owner. Stillhas rights, still ought to be given opportunities...Sowhat the Mike Low's of this world need to be, in additionto being an excellent general manager and having theability to do all the things that need to be done tomanage an operation and deal with all those issues,[they've] got to be prepared to deal with the vagariesand the nuisance factors of having two separate ownersfrom two separate cultures that ask two entirelydifferent sets of questions and on and on and on. Andhave different levels of expectations as well...[Ageneral manager of a JV should possess] tolerance,patience...you have to be appreciative. So to be a goodgeneral manager, you have to have supreme objectivity atall times, whether it's dealing with an employee or someother stakeholder, or a competitor, or whatever. Itmight be a customer. With the owners you need a muchhigher level of sensitivity and awareness but it reallycomes down to understanding, tolerance, patience and they[the owners] have to get to the point where they trustyou. And if your owner doesn't trust you then therelationship won't exist very long.The General Manager comments it is important for him to have a\"good understanding of the politics of the business\". He notes itis a very dangerous game to play one partner against the other,even though at times the temptation to do this exists.5. Training and DevelopmentThe General Manager, Mike Low, remarked \"to succeed we needpeople - innovative, skilled and well trained to meet all therequirements of our jobs\". This philosophy is entrenched at Mayoin an extensive, competency-based training program for hourlyemployees. Training is primarily on-the-job but there are alsotraining courses offered related to quality enhancement, maximizinglumber recovery, or in some trades areas when required. Allemployees are encouraged to obtain a Mayo grading ticket whichsignifies employees know how to best grade and cut wood, in order102to ensure the highest possible quality product. Employees are paidtime-and-a-half to attend these classes. A five-year training planis under development which considers adding courses on the Japanesemarket and culture, Japanese certification standards and qualityassurance.Some job retraining is done, but this is not extensive. Whenequipment is changed, a vendor may come to the mill and providetraining. Employees who are unable to perform successfully on thejob are likely to receive remedial on-the-job training which isprovided by the supervisor. A system of job rotation does notoperate at Mayo, although one production employee remarked hethought this should be considered by management as a means toalleviate boredom on routine tasks.Training for managerial and supervisory personnel is readilyavailable. Broad training opportunities exist and may includecourses in technical, superviory, or interpersonal skills. Therehave recently been speakers come into the mill to address issuesrelated to the team approach, or in another instance to provideinformation on stress management. Managers and supervisors mayalso attend training which is given externally. The consensus bymanagers and supervisors is training requests generally areapproved. Although training is available, it is not formallylinked to career development based on individual goals oraspirations.6. Performance AppraisalNo form of performance appraisal exists for union employees orfor salaried staff. Some managers mentioned for approximately one103and a half years after the reorganization in 1988, performancereviews were done. Under the earlier system, individuals would setgoals and objectives which would be reviewed with the GeneralManager. Currently, managers meet annually with the GeneralManager to discuss salary reviews, but these sessions do not focuson past and future performance goals. One manager mentions thereare no job descriptions, and subsequently is is difficult to givea performance review without a clear understanding of various jobs.To remedy this, the resource center coordinator plans to create jobdescriptions for staff positions. Some work has been done in thisarea on an experimental basis, and initial reaction has beenfavorable.7. Employee OpinionIn general, both hourly and staff employees are enthusiasticabout working at Mayo Forest Products. There is a sense ofoptimism about the future of the mill, even in an industry wheremany of the local mills are forced to close. Referring to themanagement of the mill, an hourly worker volunteers \"they[managers] do pretty good around here. I really don't have anycomplaints working here at all.\" Another member of the unionremarks employees are treated both fairly and equally. A managerexpresses \"Mayo is a mill of opportunity, you can be anything youwant to be.\" An individual on the managment team adds Mayo is\"progressive, always moving ahead, challenging, it's not easy\".The common goal for the company is to be \"the best in the industry,to put out the best product, something the Japanese are asking for.And we want to do it efficiently and to make a profit doing it. I104think we do quite well at it.\"The management group are given responsibility to run theirdepartments, and to take risks in the development of new ideas.This is aptly captured in the phrase of one manager who says,Innovative...we all have the chance here to pretty well get an ideaor whatever and run with it. There's not a lot of controls put onus that way. I've always been excited about working here.\" Thismanager mentions the workload at Mayo is much greater than anywherehe had previously worked, but \"because of that when things do cometogether there's a greater sense of satisfaction. I think each oneof us is proud to be working here. Our name is known throughoutthe industry.\"Managers work long hours, but like the people with whom theywork. One supervisor remarks for the last eighteen months he hadworked an average of 60 to 70 hours per week; another said he hadworked two months without a day off. A number of employees beginthe job at 7 a.m. and stay on the mill site until 6 in the evening.Some eat lunch at their desk while working. The intensity of theenvironment at Mayo contributes to managerial stress, and severalindividuals said they were feeling the effects of the pace. Tosome degree, managers feel they are not recognized for theirefforts, in comparison to the attention given to hourly employees.More than one manager remarked they were \"second class\" behind thehourly workers. Despite the long hours and sometimes hectic pace,the mood of employees in the mill is both jovial and respectful.In particular, this is demonstrated at the various meetings thatoccur regularly. Staff joke with one another and appear toappreciate each others efforts in the company.105The mill environment is challenging and progressive. Mostmanagers express the implementation of a performance managementsystem had been a positive step for Mayo. The productionsupervisor compared the current system to a more traditional millenvironment and states,I think it [the performance management system] is the wayto go. No doubt about that. It's very successful. Ithink we've been very successful with it here. We've gota long way to go with it mind you. But I think I knowenough about the industry to see that the potential forthis type of management far outweighs the benefits fromthe other [traditional] way I think. There's no doubtabout that. You have to get the people involved.Considering the mill environment at Mayo, the General Manager MikeLow, believes there are several important components to asuccessful organizational system, and that these are exemplified inthe Performance Management System. He describes \"if you keep theseprinciples of valuing your employees, and customer service, andquality products as the ultimate goals, the bottom line...you'llwin\".Mike Low has been a champion of the performance managementprocess at Mayo. Mike's presence in the mill has been asignificant catalyst to major reorganization and change. He hasthe admiration and respect of employees at all levels of theorganization. It was with surprise everyone received the news ofhis resignation. Mike left Mayo for a position of regional managerfor the Western division of a large forestry company. The generalannouncement to staff of Mike Low's resignation occurred justfollowing the completion of the research interviews.In our interview I had asked Mike Low what he thought theimpact of his leaving would have on Mayo.^Mike thought the106policies and practices he had helped to institute might change tosome degree, and that the mill might \"begin to fall back to someother standard...I would like to think that most of the people arestrong enough that what has been started here would carry on, butI guess the style and the focus are so unique and so unususal andso threatening that I'm not sure that it would be sustained.\"8. AftermathIn order to get employee opinion about Mike Low's resignation,I returned to the mill three weeks after the formal announcementwas made. I talked with employees over a two day period.Generally, the employees in the mill thought the style of the newmanager would have a lot to do with the relative amount of changein future for the mill. During the research interview, SandyFulton at CPFP assured a new manager would be chosen who canoperate the mill with a quality focus, using the performancemanagement system. There was concern on the part of many of theunion employees that the current management style might change. Insum, employee consensus was that some things would change, andother things would remain the same. There appeared to be calmacceptance of Mike Low's departure, and people expressed that hispresence would be missed.D. Results of the Employee QuestionnairesThirty two individuals reponded on the Minnesota SatisfactionQuestionnaire and the Culture Inventory. The group represents bothunion and staff employees. The demographics of the employees who107participated include 4 females, 26 males, and 2 unknown. Averageage of the respondents is 41.5 years, with a standard deviation of8.39 years. Ten employees had not completed high school, 15 had ahigh school education and 4 had some college or university. Theaverage number of years employees had worked at Mayo is 8.75, witha standard deviation of 3.63. Seventeen of the respondents havebeen at the mill since it opened in 1980. Of those people whocompleted the questionnaires, 20 reported they had not been absentfrom work in the last year.1. Minnesota Satisfaction QuestionnaireMean scores and standard deviations for each item of theMinnesota Satisfaction Questionnaire (MSQ), aggregated across allrespondents appear in Table 3. Aggregated mean scores for overalljob satisfaction, and category scores for intrinsic and extrinsiclevels of job satisfaction are also listed. As suggested in thetest manual, it is most meaningful to consider the overall scoreand the scores for intrinsic and extrinsic satisfaction compared topercentile ratings. A high degree of job satisfaction isrepresented in the 75 or higher percentile; mid-range is 26-74 anda low degree of satisfaction is represented by scores in thepercentile range of 25 or lower.Overall, employees at Mayo demonstrate a relatively high levelof job satisfaction. The overall score is 73.06, which while inthe mid-range area for satisfaction, is certainly on the high endof the scale. Standard deviation (s.d.) of the responses on theoverall score is 9.30, and represents a fairly wide range ofemployee responses from the mean. Percentile scores are high108(79.42) for intrinsic satisfaction and moderate (62.3) forextrinsic satisfaction. These scores indicate employees arecontent with job conditions leading to autonomy and personalfulfilment, for example, and less pleased with company policies andsupervisory practices. More specifically, the table indicatesfairly high employee scores, (represented as aggregated mean scoresout of a maximum score of 5 for a single test item), related tointrinsic satisfaction. Employees indicate they are able to workalone (4.25) and keep busy (4.34). They are free to use their ownjudgement (3.93) and to try their own methods on the job (3.81).There is a chance to tell other people what to do (3.69) and tomake use of one's ability (3.69). Employees get a feeling ofaccomplishment from the job (4.09). Working conditions areconsidered good (3.97) and employees think employment is steady(4.53).Scores are lower on extrinsic items such as the way one'sboss handles people (3.00) or the way in which coworkers get along(2.66). In general, employees do not like the way in which companypolicies are put in place (2.47). Of interest, in the unionizedmill environment employees think the chance for advancement isfairly high (3.44).2. The Culture InventoryResults of the Culture Questionnaire are displayed in Table 4.In a similar format to the results for the MSQ, scores arerepresented as aggregated means for each item of the questionnaire.Mean scores are likewise listed for each of the four organizationalculture categories represented in the inventory: group,109developmental, hierarchical and rational cultures, and an overallscore for the questionnaire. Employees at Mayo Forest Productsscored highest on the rational culture category (10.78). Accordingto the culture descriptions developed for the questionnaire,employees perceive the work environment to emphasize achievement,goal and task accomplishment, and production. The score for thedevelopmental category (10.15) is second highest, and suggeststhere is also some focus on innovation and creativity at Mayo.There is some evidence of a hierarchical culture (8.59) which istypically demonstrated through order, rules and a preoccupationwith documentation. The score for a group culture, related towhether respondents view the company as a personal place to work,with an emphasis on loyalty, tradition and human resources is thelowest score (6.93).1 10Table 3Results from the Minnesota Job SatisfactionQuestionnaire at Mayo Forest ProductsAs Aggregated Scores Across All RespondentsItem^ Mean^SD1. Able to keep busy 4.34 .482. Chance to work alone 4.25 .763. Chance to do different things 3.65 1.234. Chance to be somebody in thecommunity3.69 .595. Way my boss handles people 3.00 1.156. Competence of supervisor'sdecisions3.28 1.227. Able to do things that don'tgo against my conscience3.88 .878. Job provides steady employment 4.53 .329. Chance to do things for others 4.16 .5710. Chance to tell people what to do 3.69 .8211. Job makes use of my ability 3.69 1.2012. Way company policy is put intopractice2.47 1.2713. Pay related to the amount of work 3.41 1.2114. Chance for advancement 3.44 1.0115. Freedom to use my judgement 3.93 1.0716. Able to try my own methods 3.81 1.0617. The working conditions 3.97 .8618. The way coworkers get along 2.66 1.2319. Praise for doing a good job 3.12 1.3120. Feeling of accomplishment from thejob4.09 .82Aggregated Category ScoresMean SD PercentileIntrinsic Job Satisfaction(items 1-4,^7-11,^15,^16,^20)47.65 6.05 79.42Extrinsic Job Satisfaction(items 5,^6,^12,^13,^14,^19)18.69 3.91 62.30Total Job Satisfaction 73.06 9.30 73.06(items 1-20)111Table 4Results from the Culture Inventoryat Mayo Forest ProductsAs Aggregated Scores Across All RespondentsMean SD2.09 1.302.59 1.212.53 1.243.84 .922.41 1.393.81 1.062.59 1.103.13 1.312.43 1.393.75 1.323.47 1.323.81 1.31Item1. A personal place2. Dynamic and entrepreneurial3. Formal and structured4. Production-oriented5. Loyalty and tradition6. Commitment to innovationand development7. Formal rules and policies8. Tasks and goal accomplishment9. Emphasis on human resources10. Growth through new ideas11. Permanence and stability12. Outcomes and achievementAggregated Means for the Culture CategoriesGroup Culture 6.93Developmental Culture 10.15Hierarchical Culture 8.59Rational Culture 10.78Total Score 36.451123. Guide to Human Resource Management PracticesThe Guide to Human Resource Management Practices was completedby both the personnel administrator at the CPFP headquarters officewho is responsible for the salaried staff, as well as by thepersonnel administrator at the mill site responsible for theunionized employees. Both sets of results are quite consistentrelated to how the company operates its HRM systems. Differencesin HR policy and procedure between staff and union workers relatemostly to the guidelines of the union collective agreement.HR planning is indicated as formal and ordered but withelements of informality and flexibility as well. Planning isstated to be long-term in focus and integrated with the plans ofother departments. A group philosophy, high employee involvementand high risk-taking are noted. Staffing is primarily based oninternal recruitment, although there are some exceptions forsalaried staff. There are many career paths for salaried workers,and few for union employees. Hiring and promotion criteria areclearly stated for union staff, but tend to be more ambiguous andunclear for the salaried group. Minimal levels of experience arerequired of union employees and moderate experience is necessaryfor the salaried staff. Discrimination based on gender and socialclass is low.Career path information is available to salaried personnel uponrequest.As already noted, performance appraisal is not done with unionemployees. In theory, appraisals for salaried employees are basedon both behavioral and results criteria. Evaluation is of thetotal person, rather than strictly related to performance.113Performance goals for employees are long-term. Both group andindividual criteria are used in the evaluations. Employeeparticipation is relatively high, there is explicit performancefeedback provided, and rapid promotion.Salaries tend to be high and are consistent with the industry.There are standard fixed benefit packages and high employmentsecurity. Incentives are both short-term and long-term and manysocial and financial \"perks\" exist. Bonuses and wage increases areboth collectively shared and individually based for salariedworkers. Union wages are set by the collective agreement. Rewardsare egalitarian, and open for union employees and secret pertainingto the salaried group.Training is short-term in focus. Employee input is high andthere is minimal job rotation. The training for union workerstends to be narrow and specific. For salaried employees traininghas both an individual and a group orientation, is providedinternally as well as externally, and is both on-the-job and in theclassroom.114E. Summary of the Results1. Mayo Forest Products is a small, unionized sawmill which hasbeen operational since 1980. Mill performance had declinedfrom 1980-1987. To counter this trend a major reorganizationplan for the mill was instituted in 1988. A High PerformanceManagement System was implemented. Currently Mayo is verysuccessful in the international marketplace.2. Initially Mitsubishi had considerable involvement in thedesign and start-up of the mill. Mitsubishi participation inthe mill operation has declined over the years and theircurrent primary role is to market lumber to the Japanesemarket. CPFP has the management contract for the mill. Thejoint venture relationship is considered beneficial by bothpartners.3. The JV General Manager has been given a mandate to operateMayo in an autonomous fashion. To some extent, however, theMayo mill functions as a subsidiary of CPFP.4. Mayo Forest Products focuses on being a high quality, low costlumber producer.^The company aims to meet customerrequirements. Management's philosophy is accomplished throughbuilding a dynamic team of people at the mill. This isencouraged by the active involvement and recognition ofemployees.5. The HR role at Mayo is peripheral to policy decisions andplanning related to HR objectives. The personnel managers forboth salaried and hourly employees have largely administrativeroles. HR policy is typically set by staff at CPFP115headquarters.^Front-line supervisors have the primaryresponsibility for working with employees in HR related areas.6. Employee involvement is nurtured through information sharing,the solicitation of employee ideas and suggestions, and byproviding employees with performance feedback.7. Management and the union are working toward developing anincreasingly cooperative relationship.8. Shifts in control have occurred as supervisors provide moreinformation to employees. In turn, employees are expected toassume more responsibility in the mill operations.9. Salaries are the primary form of compensation at Mayo. Thereare no profit sharing programs.10. Multiple forms of recognition exist. Managers consideremployee recognition one of the most challenging components ofthe Performance Management System. Managers strive to makethe recognition system meaningful and sincere.11. The preference for recruitment is to hire employees who can beteam players. In the management group, personal skills areconsidered more important than technical abilities.12. At Mayo there is a strong commitment to training employees.Money and effort have been devoted to the creation of acomprehensive training system for unionized employees.Training is openly available to staff employees.13. Performance appraisal basically is not done with employees ineither the union or the salaried groups.14. Employees are generally enthusiastic about working at Mayo.They view the operation as progressive and successful.Employees consider Mayo to be production and achievement116oriented.^They feel there is insufficient emphasis onloyalty, tradition, and human resources.15. Overall, the employees at Mayo Forest Products express arelatively high level of job satisfaction. Employees are morecontent with conditions leading to autonomy and personalfulfilment than they are with certain company policies andsupervisory practices.117CHAPTER FIVEOCG MICROELECTRONIC MATERIALS, INC.A. Joint Venture BackgroundI. History of the VentureOCG Microelectronics was formed January 1, 1991 as a jointventure between Olin Corporation (50%) of the United States andCIBA-GEIGY A.G. (50%) of Switzerland. OCG aims to be an innovativesupplier of photoresist and polyimide products and services tosemiconductor customers on a worldwide basis. Photoresists arespecialty chemicals consisting of polymers and sensitizers whichare used to create the pattern of electronic circuitry on siliconwafers used in semiconductor manufacturing. Polyimides are highperformance polymers used in fabrication and packaging of advancedsemiconductor devices, including multichip modules. To maintain asolid market position as a supplier to fast moving semiconductorcompanies, OCG products must meet specific customer requirementsand be of an impeccable quality and standard. OCG is committed tomeeting customer demands for product quality, on-time delivery,packaging, technical problem-solving and innovation. Productmarketing is to Europe, North American and the Pacific Rim.The venture brings together unique capabilities of the parentfirms. OCG combines the photoresist business of Olin Hunt, (awholly owned subsidiary of Olin), and the photoresist and polyimideproduct businesses of CIBA-GEIGY Ltd.(Switzerland) and CIBA-GEIGYCorporation (Ardsley, New York). Olin Hunt has a significantmarket position with strong sales, marketing and customer serviceorganizations. Olin Hunt excels in product development.118Complementary to these strengths, CIBA-GEIGY has done extensiveresearch and development in polymers; and brings to OCG itspolyimide business, the newest group of products used in thefabrication of advanced semi-conductors. In addition, OCG assumesOlin Hunt's former 49 percent interest in Fuji-Hunt ElectronicTechnologies located in Japan. In this latter instance, byretaining the link to Japan, OCG is able to expand its presence inPacific Rim photoresist markets and to act as a distributor for theJapanese polyimide market. According to the joint venturepresident, Jim Favier, the combined capabilities of the parentcompanies allow the joint venture to excel in the global market.This ability is greater than if either parent were to operateindependently in the microelectronics sector.The structure of OCG is both complex and decentralized.Headquarters for OCG are in West Paterson, New Jersey.Manufacturing of products is in East Providence, Rhode Island withan additional manufacturing facility planned for Europe. Researchand Development is undertaken in East Providence, Rhode Island andBasel, Switzerland, and is coordinated on a global basis. Tomaintain close customer relations, customer support and technicalservice centres are located in Tempe, Arizona; St. Niklaas,Belgium; and Yoshida, Japan. According to staff in the venture,OCG is currently the only photoresist supplier with research anddevelopment, manufacturing, technical customer support, andmarketing capabilities in all three major electronics markets ofthe world, (i.e. Europe, North America and the Pacific Rim). Thisunique feature makes OCG an example of what is termed a triadalliance.119Employees for the joint venture will consist of current OlinHunt and CIBA-GEIGY personnel who will eventually be transferred toOCG. In the North American operation, the manufacturing and R&Dfacility in East Providence, which had previously been a whollyowned subsidiary of Olin (called Olin Hunt), will remain intact.During 1991, CIBA-GEIGY employees in Research and Development atArdsley, New York will continue to operate from CIBA-GEIGYfacilities until they are relocated to West Paterson. Customerservice employees who are currently employed by CIBA-GEIGY in SantaClara, California will be relocated to Tempe, Arizona. In Europe,joint venture employees will be situated at OCG businessheadquarters, the customer service centre, as well as in CIBA-GEIGY's R&D facilities in Basel, Switzerland. In total, OCG has196 nonunionized employees.2. Management of the VentureThe management group responsible for OCG operations consistsof a President, Technical Director, Financial Director, and twoBusiness Directors for North America and Europe. The President ofthe JV reports to a six person Board of Directors which has equalrepresentation from Olin and CIBA-GEIGY. The board Chairmanrotates between the parent companies. The primary role of theBoard is to establish business and management objectives for OCG,and to review financial results. There are four board meetings ayear. An advisory board also exists which consists of one seniormanager from both Olin and CIBA-GEIGY, (who are both on the Boardof Directors), and three additional members from each parent firm.Of the eight person advisory board, six of the members are able to120vote and there are two nonvoting members who are the JV president(previously an Olin employee), and the Financial Officer for OCG(previously a CIBA-GEIGY employee). The advisory board meets everyfour to six weeks. It is this group who are concerned with ongoingoperational issues at OCG. Issues raised at the advisory boardlevel are then passed to the Board of Directors, as required.Although still in their infancy, to date the boards havefunctioned effectively. To some extent this may be a product oftolerance and interpersonal \"chemistry\". As the President of OCGremarks, \"the parents in a joint venture are generally much moretolerant of their joint ventures than they are of their ownindividual businesses because they don't want to look to theirpartner as if they're not being reasonable\". The main issue ofcontention so far - the location of the European manufacturingfacility - was settled in a manner amenable to both partners.Several of the senior managers alluded the JV is working wellbecause the two most senior board members, each representing aparent company, get along well on a personal level. There is goodcommunication between these senior executives and the rest of themanagement group.As part of the original joint venture agreement, varioussupport services, including those in the human resource managementareas would be contracted from Olin. Part of the justification forthis decision originated with the fact approximately ninety percentof the staff in OCG were formerly Olin or Olin Hunt employees. Inorder to minimize the disruption to employees, all the Olin HRpolicies and procedures were adopted to OCG until such time whennew policies specific to the joint venture could be created. At121the present time a number of key policies related to benefits andrecognition programs are under review. As part of the reevaluationprocess, the HR manager for OCG indicated she would consider thecurrent HR policies of both parents, and then choose one policy, orcombine policies from both Olin and CIBA-GEIGY, to create HRpractices most suitable to the requirements of OCG.The contractual agreement to lease management services fromOlin is not entirely satisfactory to all CIBA-GEIGY executives.Senior members from the CIBA-GEIGY side of the operation realizethey have very little management control in a business in whichthey are a 50/50 partner. An OCG Vice-President who came fromCIBA-GEIGY, observes even before the joint venture was formed therewas a concern the Swiss parent wanted to be more than financialinvestors. Originally CIBA-GEIGY wanted to \"really have an equalvoice in the management and the operation of the company\". Thissame individual, who has considerable experience in the benefitsarea, hopes his expertise will be called upon when determining anew benefits package for employees at OCG. The Vice-President forHuman Resources of CIBA-GEIGY U.S. notes related to contractingservices for OCG from Olin, he has neither funding nor personnelbuilt into his departmental HR budget to formally contribute to theOCG venture. Subsequently, he currently takes a \"back door\"approach to reviewing HR policies for possible implementation atOCG. Although this CIBA-GEIGY executive adds he will eagerlyreview policies as requested, the question remains as to the levelof involvement which is reasonable and appropriate for him, giventhe management contract for OCG formally rests with Olin.Despite these concerns there is insufficient influence by122CIBA-GEIGY in the management of OCG, the contractual arrangement isgenerally viewed as satisfactory. One executive comments,My initial reaction was sort of negative, in that Ithought it would be better if OCG had its own peopleproviding financial and HR systems...and I just had mydoubts that some service arrangement might not work outwell. But it's turned out that generally these groupshave performed quite well for us, and I think they likeworking for OCG in a sense...On the plus side it permitsOCG to be a fairly lean organization in that it doesn'thave levels of bureaucracy and all these support groupson our payroll directly.Given the major presence of Olin employees in OCG, managersrecognize one of the major challenges for human resources is theintegration of formerly CIBA-GEIGY staff into the venture. For thegroup of employees who are currently working in CIBA-GEIGY'sfacility at Ardsley, absorption into OCG means a physicalrelocation to East Providence, and the adoption of new benefits andother related HR policies. As the president of OCG comments, thisrepresents merging ten percent of the staff who were CIBA-GEIGYemployees into a new organization strongly influenced by Olin. Headds this creates an \"identity crisis\" for this group, especiallywhen they are still operating out of CIBA-GEIGY facilities.Although the management at OCG would prefer to rapidlytransfer Ardsley employees to the OCG location in East Providenceonce the joint venture had been established, a space shortage madethis impossible. In the interim period, there is great uncertaintyamong the formerly CIBA-GEIGY, now OCG employees, regarding theirfuture. One Vice-President remarks, \"the problem is if you keeppeople at a CIBA-GEIGY location, particularly a major one like aheadquarters, which is Ardsley and Basel, they'll relate to theparent company\". The Director of Human Resources for Electronic123Materials at Olin notes a great effort will be required if thegroup of formerly CIBA-GEIGY employees are to feel an integral partof the new joint venture company. Part of the consolidationrevolves around building a unified corporate culture in the jointventure. The Olin HR Director observes,The key challenges are to facilitate the integration ofthese people coming in from other organizations. Tobuild comraderie and team spirit. To make sure there isconsistency in how people are treated. And I think thatas rapidly as possible to come up with programs in termsof the development and training of employees. There's alot of consistency that comes from the Olin side.There's a lot of consistency that comes from the CIBAside in terms of the CIBA people. What they [OCGmanagement] need to do is to gain the cohesion and bringthe people together and then develop the sensitivity ofprograms for the future. I think when you smash, andthis hasn't been a smashing, but when you integrateorganizations like that I think it's important to, Ithink, get people on the same wavelength and make themfeel like they're part of the team, and give a lot ofdirection.Much of the responsibility for the integration process rests withthe human resources department. A large part of this processrevolves around the creation of fair and consistent policies forall employees. According to the HR manager for OCG, ensuring openlines of communication at all levels of the company is a centralconsideration.As a newly created venture, OCG is clearly in a transitionalstage. Even though the venture is influenced by the parentcompanies, the opinion of the management staff is OCG is given thereins to operate in a relatively autonomous style. To some extentthis freedom has been earned from the consistently high performanceof the venture, despite its youth. The joint venture Presidentnotes in the world market OCG is already \"number three\" in themicroelectronics industry. The precocious beginning of OCG is124described by the Vice-President of Finance and Administration,We're way ahead of our budget in sales and profits, andit's already a very profitable business...I see anenormous future for this business. I think we'll be apretty good model to both parent companies as to asuccessful joint venture. I think often these thingsdon't work out. But I think there's a real good feelingabout this one.B. Strategic Orientation1. The VisionTo compete in the microelectronics market, OCG has beenstructured like a small, entrepreneurial company but with theadvantage of access to the resources of the two parentorganizations. The relative separateness from both Olin and fromCIBA-GEIGY allows OCG to operate \"lean and fast\". OCG has a visionwhich was jointly constructed by representatives of the parentfirms. The vision statement for OCG, as it appeared in theJanuary/February edition of the Olin Hunt newsletter is:• Be universally recognized as a preferred andinnovative supplier of quality photoresist andpolyimide products and services.• Be committed to meeting customer expectations 100%of the time.• Position itself to be a premier supplier in NorthAmerican and Europe, and achieve a strong positionin Japan and the rest of the world by 1995.• Continually introduce to the market high-valueadded-performance materials that meet thetechnology requirements of the semiconductorindustry.125•^Operate in an entrepreneurial fashion, whilemaintaining access to the resources of the parentcompanies.To maintain a strategic advantage in the microelectronics industry,the company focuses on creating high quality products which can beadapted to meet specific customer needs. As Jim Favier explainedin a news conference held in January 1991,We have created OCG Microelectronics, in fact, to ensurethat we can keep pace with demands for ever-purer andmore versatile electronic chemicals. The resources thatwe have assembled from our parent companies will not onlyallow us to develop innovative products; they will alsoallow OCG to quickly cycle them from the lab to themarketplace, and to customize them to satisfy differentend-use applications.Jim Favier continued that dedication to quality at OCG \"will driveour quest to become the premier worldwide supplier of advancedmicroelectronic materials. Indeed, it is my intention that by1995, OCG will be the company which other specialty chemicalsuppliers use as a benchmark for excellence.\"The vision for OCG is already familiar to employees of theventure. In general, most employees know the company goal is toeventually be a premier supplier worldwide. A research manager inR&D at East Providence remarks he would be \"shocked\" if employeeswere not aware of the mission for the company. He said this visionhas been communicated to his group through specific presentations.In the manufacturing side of the operation at East Providence, aline worker in the formulation department notes management hadrecently spent a considerable amount of time talking to employeesabout the importance of quality products. He adds \"we haveimproved our product quite a bit\", and knows the vision for OCG to126be #1 in the business.2. Meeting the GoalOCG pursues quality improvement through a formal processknown as Total Quality Management (TQM).^The program wasoriginally developed by 3M and adopted by Olin.^Under thisprocess, the aim is to satisfy customers' expectations 100 % of thetime. OCG uses Olin handbooks to explain the TQM philosophy toemployees. The key principles of Managing Total Quality are:1. Identify the expectations of both external and internalcustomers. This includes identification of the requirementsof the end-user, as well as knowing the expectations of otheremployees at OCG who depend on an individual to get their jobsaccomplished effectively.^Conformance to customerexpectations has top importance.2. People are encouraged to use their abilities to contribute toimprovements in the operation.^This includes taking\"ownership\" and responsibility to improvements, and makingrelevant decisions in a job area. The ability to work as amember of an effective team is important.3. A major emphasis is placed on prevention of errors or defects,and problem-solving.The goals of TQM are implemented on a individual basis withemployees using a Performance Management Process (PMP). Basically,this involves personalizing the principles outlined for TQM.Employees work with their supervisors to identify customers,customer expectations, as well as preparing a plan of how to meetthose expectations. Follow-up with customers is arranged. This127system forms the mechanism by which employees are evaluated ontheir performance.Although TQM had been in place in the Olin Hunt organizationfor approximately the last two years, there have been varyingdegrees of success in its implementation. As one total qualitymanagement facilitator describes, the process is too strenuous andtime consuming. With the formation of the new joint venture, stepsare being taken to simplify the performance management system.Although a focus of PMP is on teamwork and the reward andrecognition for team performance, Rodney Hurdich, the Director ofR&D at East Providence remarks OCG does not pay sufficientattention to this aspect of the program. He adds the TQMphilosophy does not apply just to North American operations, but toEurope as well. According to the R&D Director, TQM is beingimplemented slowly in the European arm of OCG, and there isconsiderable \"suspicion\" of the process. Related to culturaldifferences, he notes TQM may need to be packaged differently forEuropean employees.To meet the requirements of a total quality management system,the human resources department is developing new forms of rewardand recognition for employees. Communication systems are beingestablished which keep employees informed of developments in thecompany. OCG management hopes employees ideally will identifywith the company vision, and feel as if they are an integral partof OCG. Given the decentralized nature of OCG, the creation of anintegrated company unit is a significant task. Related to thesechallenges, HRM has a central role to play in the development ofthe TQM system.128C. Human Resource Management at OCG1. The HR Departmental RoleThe manager for Human Resources, Maida Garabed, has worked invarious personnel functions with Olin Hunt Corporation for elevenyears before her selection to the current role at OCG. In herprevious position as Personnel Manager at Olin Hunt, Maida wasresponsible for staffing, EEO, compensation, employee relations andhandling complaints which managers may have had with employees.She was chairperson for the training and orientation of a committeewhich focuses on increasing quality in the company. Added to theresponsibilities she had at Olin Hunt, although now focused solelyto OCG, her new responsibilities include relocation of employeesfrom the parent companies to OCG, and the creation of HR policy andprocedure specific to the needs of the new joint venture company.Maida deals with issues related to the familiarization of employeeswith the company, benefits, and training. More specifically, sheis dealing with problems related to the integration of formerlyCIBA-GEIGY employees into OCG. Maida actively solicits theopinions of employees and representatives of both parent companiesas to how this integration might best be accomplished. Related tothe determinion of employee attitudes and needs, she interviewedmany of the employees at the East Providence facility, and allArdsley employees who will be part of OCG. She is working withmanagers to develop better policies in the areas of benefits,recognition, and employee-management communication.In the North American operation of OCG, Maida is the only129person assigned full-time to the human resources function. Thereis also an HR manager for OCG in Europe. In keeping with thedecision to contract HR services, Maida draws all of her supportservices directly for Olin Hunt in the areas of administrationsupport, clerical support and benefits. Maida and the supportstaff are located in the Olin Hunt headquarters office in WestPaterson, New Jersey. She reports directly to the Vice-Presidentof Finance and Administration.Maida is proactively involved in creating HR policy andprocedures for OCG. Her involvement in the joint venture beganearly, in November 1990, two months before the signing of the jointventure contract. It was at this time she was designated the HRmanager for OCG. The only other person officially assigned to OCGat his time was the Vice-President of Finance and Administration.Both the Director of Human Resources for Electronic Materials atOlin and the Vice-President of Human Resources for CIBA-GEIGY U.S.were likewise involved in the developmental plans for HR at OCG.The initial discussions primarily centered around the transfer andintegration of employees to OCG, and the development of benefit andcompensation systems. The senior HR managers from each of theparent firms continue to be associated with Maida in the creationof various policies for OCG.HRM is aligned to the business plan of OCG, and is orientedtoward maintaining quality in the organization. Maida comments,\"the annual quality plan that we have for HR monitors very closelyturnover, monitors promotional moves versus external hires,monitors the training, the tuition that we give [employees]. Wealso monitor any recognition programs.\" The manager to whom Maida130reports agrees there is a substantial linkage between HR goals andthe business plan. He mentions that as they begin to more fullyimplement the performance management process, which links employeeperformance to the total quality approach, that the HR departmentwill be directly involved in designing some new policies on rewardand recognition for employees.In the initiation of new HR policy for OCG, Maida notes in heropinion the HR objectives and policies of both Olin Hunt and CIBA-GEIGY are very similar. She considers the policies of both parentsand then chooses one over another, or creates policies unique toOCG. Maida remarks most of the guidance she receives comes fromOlin, and in HR areas that may require revision she can \"always tapback to Olin Corporation\". For example, Maida receives assistancefrom the labour department of Olin on issues related to OCG hourlyemployees. Maida meets periodically with the management staff ofOCG and discusses with them planned HR changes for the venture.Once a major HR issue is approved at the OCG management level, thenit is presented at the advisory board level for final approval.The creation of a new benefit package for OCG is one instancewhen the HR manager has worked jointly with senior staff from bothOlin Hunt and CIBA-GEIGY. Jon Swenson, who is Maida's bossexplains there is a benefits task force which is looking atpensions, medical coverage, savings plans, and long-termdisability. He remarks they are \"looking at both company's [OlinHunt and CIBA-GEIGY) programs and coming up with what they thinkwill be suitable for OCG.\" Mike Lamona, the Vice-President of HRfor CIBA-GEIGY U.S. has been involved in reviewing the new benefitspackage. According to him, \"I find myself frequently involved131either developing product or critiquing their product particularlyaround the areas of incentive...around what type of benefitentitlements are we going to have futuristically for this venture.\"Maida notes she appreciates the involvement by the CIBA-GEIGYstaff. Alternately, the CIBA group feel they have expertise in theHR area which they can offer to OCG, although some of this groupare uncertain as to just how much time and effort should reasonablybe expended when the HR management contract belongs to Olin Hunt.One individual mentions a possible addition to the HR function atOCG might be to include a CIBA-GEIGY HR professional, who couldbring perspective and information from the CIBA-GEIGY parent to theventure.As already mentioned, Maida has the responsibility for HRM byherself. Located in the headquarters office in West Paterson sheis within several hours driving distance of both Ardsley and EastProvidence locations for OCG. Maida tries to visit both sites ona regular basis. Related to the numerous responsibilities of HRMin the venture, several OCG managers mention an expanded HRfunction might be in order. One Director in East Providenceobserves HRM is not \"crystallized into a place where you can go andget it\". He continues,We've been so used in the past to dealing remotely withthe issues of human resource management if you like, thatwe've tended to do our own thing. We work as a team[i.e. the members of his group] in terms of managingpeople and understanding their needs, and how tointerview. None of us have been formally trained, by theway, we just learn by mistakes, basically. And it'sunfortunate, because we should be trained. Since themost important thing you can often ever do in a year isto hire somebody.Other managers at East Providence agree HR should be expanded132to include a resident HR manager at the location. Although theyfeel Maida's assistance can be used from a distance because ofmodern communication, the consensus is it would also be desirableto have someone on site to maintain consistency of policies for thenonexempt (hourly employees), and for the administration ofprograms. As operations now exist, the plant managers for bothmanufacturing and R&D have assistants who help in the HR area, aswell as do other tasks. These two individuals maintain clericaladministration for HR including payroll sheets, vacation leave,absentee reports, medical forms, job postings, new hire orientationand exit interviews. They also schedule and track employeetraining. Despite this, there is an absence of someone at EastProvidence to provide daily guidance related to policies andprocedures which are created at the headquarters office.2. Creating an Integrated Joint Venturea) Consolidation of CIBA-GEIGY Employees into the VentureMuch uncertainty exists for employees who previously haveworked under the protective umbrella of a large multinationalcorporation like Olin or CIBA-GEIGY, and who now find themselvestransferred to a small joint venture company of approximately 200people. Benefit programs and incentive programs are currentlyunder review at OCG, and it is not clear to employees what theirnew employment packages will contain. For some, there is an issueof divided loyalty to the parent firm and to the joint venture,especially for those employees still housed in a parent companyfacility. Employees who have been asked to move to anotherlocation have concerns about housing costs and living conditions in133the new area. Although there are some similarities between thecultures of Olin and CIBA-GEIGY, there are also many differences.Employees will be required to adjust certain values and proceduresof how work is accomplished. The physical distances betweenlocations within North American, as well as the separate sites forOCG in Europe and Japan make communications complicated.The management at OCG fully realize the magnitude of the taskfor creating an integrated joint venture from its now separateparts. Integration will need to be accomplished on two levels.There is the issue of physical relocation of people to a new worksite, such as moving the Ardsley employees to the East Providencefacility. In addition, a looming concern is how to create loyaltyto OCG, so that employees enthusiastically identify with the newcompany and what it has to offer.Although there are no simple solutions for creatingintegration in a joint venture, one Vice-President in CIBA-GEIGYmentions the importance of choosing a partner with a relativelysimilar corporate culture. To an extent this reduces the degreeemployees need to readjust values and norms. In addition, there isa benefit in creating policies and structures early, before thejoint venture officially begins. He explains,The most important thing on the human resource side is todetermine how similar or dissimilar the partner is thatyou're going to partner with. Clearly, as I feel theconcerns of employees, the concerns are minimized whenthe partner that you're getting is very much like you.In areas where it's dissimilar, I think a lot of theseissues bubble up around just uncertainly and aretranslated into problems of job security...I think themore things you can resolve before the first official daythat people cohabitate as one business, the better offyou're going to be. Because what you find out if youdon't do that, it's kind of play as you go and you havepeople in this extraordinary position in that on one hand134they know they are part of this new venture, but on theother hand they're being treated as they were alwaystreated when they were part of your venture. And I thinkthere's probably some internal schizophrenia that's goingon trying to figure out how to behave and what to do andwhat to respond to.Various employees note some of the dissimilarity between thetwo cultures of the parent companies relates to differences insize, and to some extent the national origin of the company. TheOlin Hunt subsidiary of Olin is smaller, more entrepreneurial, witha tradition of informality. In contrast, a CIBA-GEIGY executiveobserves the European company is more bureaucratic and conservativethan is typical of most American companies. He says, \"theEuropeans are much more conservative in their approach to decisionmaking...we tend to be perhaps a little more forgiving aroundresults because of our preoccupation with the longer term...we tendto be a little more paternalized\".As already noted, a priority for the North American operationis to integrate the group of formerly CIBA-GEIGY employees stilllocated at the parent headquarters into the OCG framework. TheDirector of R&D at Ardsley explains the majority of the people inhis unit have experienced \"a tremendous amount of personalinsecurity\" as a result of their absorption to the joint venture.He elaborates most of the people in his group joined CIBA-GEIGY outof school and have been with the company less than five years. Forthem, to find out they are now part of a joint venture and notworking for CIBA-GEIGY, came as a \"big shock\".One Vice-President in CIBA-GEIGY summarizes many of theconcerns of the OCG Ardsley employees in the following way:Let me start first by saying I think they [OCG employeesat Ardsley] were angry...they had no option. This is135quite unlike we're going to sell the company and theywant you to come to work for them. Do you want to and ifnot we have a job for you elsewhere. When you form ajoint venture and you're going to have a 50 percent pieceof it, one of the things you find out very early in thegame is you're not going to give key players very manyoptions. I mean you're certainly not going to try tokeep them within CIBA-GEIGY to the detriment of your new50/50 interest that you've just put $70 million and yourbusiness on the table for. So consequently, you givethem no lifelines whatsoever and what you say to them ineffect, the proposition to the Ardsley group was: 1. Theonly job you have available is to go to work for OCG. 2.It happened so quickly we have not sorted out everylittle detail around your benefit entitlements butsuffice it to say that they'll be comparable. 3. We knowyour circumstance is uncertain and you don't know yournew boss and so forth and so on, but trust us it will beO.K. We have no idea what their culture is but we thinkit is similar to ours. 4. We know that longer term we'dlike to consolidate Ardsley into East Providence, RhodeIsland. We have an idea what time frame that may be.We're not positive every one of you here will have a job,but we think most of you would be offered theopportunity. And oh, by the way we know most of you havenever relocated before so we accept the fact there is alot of uncertainty associated with that circumstance.And 5. would be the issue of while you're there and doingthe job for OCG don't bother to bid for other jobs withinthe CIBA-GEIGY Corporation because we're not acceptingyour bid. Now the corollary to that is we'll providethings like a stick around bonus and an incentive to stayto the end. And a promise that you'll be treatedreasonably and that if you make a certain date, we'll letyou bid on anything within CIBA-GEIGY, which is in twoyears.The final issue mentioned in the above text refers to a policycreated for the joint venture which prohibits employees from eitherOlin or CIBA-GEIGY to \"bid back\" to jobs in the parent companiesfor a period of two years. The intent of the policy was to createstability within the OCG venture. The policy was initiated whensome employees at Ardsley bid for lateral of lesser positionsinside CIBA-GEIGY to avoid a move to join OCG in East Providence.In certain circumstances, exceptions to the no bid policy can bemade. An Olin executive qualifies,136This restriction doesn't preclude someone being able totransfer if OCG management no longer needs a particularskill, and the parent is willing or has a position forthat person back with the parent. There should benothing to keep that from happening. What you do need toput a block in though, is the matter of choice where theemployee chooses to move creating a hole whichjeopardizes the JV.As another example, employees may also be able to transfer from OCGback to a parent if the move is promotional and enhances careerdevelopment. The two year no-bid policy was supported by bothparent companies, and applies to European as well as North Americanoperations.A concern over relocation also exists for OCG employees inSwitzerland. Of 20 to 25 CIBA-GEIGY employees in Switzerland, 3will become OCG employees, and the others will be leased to OCG.As Jon Swenson, Vice-President of Finance and Administration at OCGclarifies,The issue with the three people, it's been a difficultissue getting them to become OCG employees because theyhad concerns about whether they would be forced torelocate out of Switzerland. They wanted some guaranteesthat they would not be relocated. We're not going togive them that guarantee because even CIBA wouldn't givethem that guarantee. And they wanted sort of a parachuteto go back to CIBA-GEIGY under certain conditions. Andthe only two conditions that will permit that is that ifthey are fired from OCG, CIBA-GEIGY will take them backor if the CIBA-GEIGY ownership of 50% of OCG is changed,then CIBA-GEIGY would take them back. So it's been likepulling teeth apparently, just to get those three peopleand to have a suitable negotiated contract.Jon Swenson added he was recently in Switzerland. Referring to thenew OCG employees there he said, \"I think it will take a long timebefore they consider themselves part of OCG\". According to JonSwenson, part of the estrangement to the venture stems from thefact these people are situated in a large CIBA-GEIGY complex.Another condition fuelling the uncertainty of employees137assigned to the joint venture is that the same policies are notconsistently applied to everyone who is now in OCG. For example,employees who relocate from CIBA-GEIGY into OCG would do so underthe CIBA-GEIGY relocation policy. Ardsley employees still operateunder CIBA-GEIGY policies for education tuition reimbursements andvacation entitlement. They are uncertain how various entitlementswill change once they are officially located in the OCG facilityand begin to operate under what are predominantly Olin policies andpractices. For OCG employees who were transferred to the jointventure from Olin Hunt, their benefits and entitlements primarilyremain those of Olin Hunt, until new policies are created specificto OCG. However, at the present time the two groups of employeesfunction under separate benefit systems.Maida Garabed, the HR manager for OCG has taken an active rolein attempting to quell the tide of anxiety created for employeesassigned to the venture. With respect to the Ardsley location,Maida has conducted individual interviews with all OCG staff therein order to hear of their concerns and preferences. Maida visitsArdsley for one day every two weeks to provide OCG employees withinformation, and to answer any questions. A \"Family Night\" wasplanned for OCG employees and their spouses. The intent of theevening was to present information on the East Providence area andto highlight relocation policy provisions. A relocation taskforce, (composed of people from Ardsley, East Providence, and theheadquarters office in West Paterson), was created to consider howto best phase the transfer of people from Ardsley to EastProvidence. In addition, to help integrate Ardsley employees intoOCG, they received the Olin Hunt Total Quality training package, as138well as teamwork training provided from the West Paterson office.The Ardsley group has been included in two company picnics andemployee recognition dinners.Unlike the Ardsley employees, the staff at East Providencehave experienced minimal change now they are part of OCG. Yet someapprehension was also expressed by those employees related to theirfuture in the company. In the R&D group, there is some concern asto how the R&D tasks will be split between themselves and Europe.One manager in R&D at East Providence elaborates the decision hasalready been made that most of the research would be done inEurope, and most of the product development would be done in EastProvidence. The R&D manager found this unacceptable. In his view,under this arrangement he and his colleagues would not have theopportunity to work on the most interesting and creative parts ofa project. This isolates the research and development activitiesfrom each other, prohibiting the start to completion of a projectby a single group.b) Other Integration IssuesIn addition, some employees perceive distinct differencesexist between the manufacturing and R&D groups in the EastProvidence site. Each group operates in separate buildings,connected by a catwalk. Apart from the space separation, membersof both R&D and manufacturing historically have considered theirroles and operating styles quite different from one another. Onemanager in research refers to this distinctiveness as the \"centralresearch versus operating unit gap\". He notes between the twogroups there are communication problems, and differences inviewpoints. Although the cultural \"gap\" between manufacturing and139R&D is not unique to joint venture firms, it creates an additionaltask for OCG management to address how better communication andunderstanding among diverse units can be accomplished. Toencourage teamwork between the R&D and manufacturing, a number ofproject task forces have been established which include membersfrom both departments. There is also a proposed plan to exchangetechnicians between R&D and production. For example, if a job wereavailable in R&D and someone in the manufacturing plant isqualified for the position, then that individual could move intothe R&D group. This form of cross-fertilization is intended tobring the two cultures closer together, physically as well as forthe purpose of creating better levels of understanding between thetwo units.One of the strengths of OCG is its presence on threecontinents. This arrangement allows the venture to provide productdevelopment and marketing which is close to the customer. However,at the same time the decentralized nature of OCG makes thedevelopment of a consistent, united corporate culture elusive. Inthe United States there are multiple OCG locations. Consideringonly the Eastern United States there are currently three locationsfor OCG. Once employees move from Ardsley to East Providence therewill be two. In that instance, manufacturing and R&D employeeswill be in East Providence but the executive staff including thejoint venture president, the various Vice-Presidents, as well asthe Human Resource Manager will be in the Olin Hunt headquarters inWest Paterson. Most managers express eventually they would preferto see senior OCG management located on the operations site. TheDirector at Ardsley suggests having employees in one location is140\"how you really build unified culture\". Although moderncommunication like telephone and fax are adequate, he continues\"there is no substitute for face to face communication\".3. Communication Strategiesa) A Format for Information ExchangeOCG has numerous mechanisms in place to facilitatecommunication among the various branches of the joint venture.Members of the headquarters office routinely travel to EastProvidence to participate in meetings. The photoresist productmanager describes she spends about ten to fifteen percent of hertime in East Providence meeting with representatives from both R&Dand manufacturing. Task teams are used extensively. The HRmanagers describes task groups have been assembled to consider avariety of issues including quality, recognition, environmentalissues, benefits programs, and the expansion of the East Providencesite to accommodate Ardsley employees. Several cross-functionalteams are in operation between production and research. RichLeach, the technical manager in manufacturing at East Providenceremarks he meets on various cross-teams several times a day. Asone example, he mentioned he is part of a team with two people fromresearch at East Providence and someone from process technologyfrom Olin. According to Rich Leach the team approach meanssometimes it is difficult to determine the boundaries of oneperson's job from another, but there are likewise benefits to begained. Other meetings include Quality luncheons hosted by OCGmanagement staff for groups of ten to twelve employees drawnrandomly from multiple levels in the organization. The purpose of141the luncheons is to share information about the company withemployees. There is a question and answer period in whichemployees can participate in the discussion. The president of OCGaddresses employees on an occasional basis to discuss the progressof the new venture.In the manufacturing facility in East Providence there areregular (usually weekly) meetings between supervisors and lineworkers during which they discuss progress for the week, upcomingissues and safety. Supervisors meet each morning in an informaldaily production meetings for one half hour. There is an employeesuggestion box and bulletin boards which display job postings,safety information and social events. The various formats forcommunication allow employees to express their ideas to management.Bob Pailthorpe, who is the production manager at East Providence,notes he has \"an open door policy and people can speak up and saywhat they want\". Employees offer suggestions which are acted upon.He cited an example of how the company had changed the method ofpacking boxes based on employee input. Line workers can requestmeetings to discuss group issues at any time. Although employeeopinions vary as to how well they are informed, the productionmanager thinks the company provides more information at presentthan they have ever before. An employee in the packagingdepartment remarks \"it seems we're forever having meetings\". Hesaid he participates in several meetings a month and getsinformation through memos.In the research and development area at East Providence thereare also regular meetings. The Director of R&D, Rodney Hurdich,mentions there is a staff meeting every two weeks where speakers142may be introduced from other departments. Maida Garabed attendedon one occasion to discuss personnel issues. Rodney Hurdich sharesinformation with his staff obtained from international meetings.Information is also distributed through memos and research reports.Despite these attempts to inform staff, he adds certain groups(i.e. the technicians) in R&D feel they are not getting sufficientinformation at all times.The employee handbook which is currently distributed to OCGstaff was originally produced for Olin Hunt, and describes the OlinHunt philosophies and benefits. There is a monthly employeenewsletter \"Images\" produced for Olin Hunt organizations, includingOCG. Beginning in April 1991 the top runner on the newsletter waschanged to signify it was for a publication for both Olin Hunt andOCG organizations. \"Images\" presents articles about teamwork, theformation of OCG, executive profiles, and other company activities.In the March 1991 issue a full page described the role of theArdsley group as part of OCG. In the same month, a new column wasadded which features recognition of teamwork; this is anopportunity for workers to publicly thank other workers for theirefforts and contributions.Some managers question whether a newsletter which focusesprimarily on Olin activities allows OCG to develop an identity asa separate company. One CIBA-GEIGY manager wonders whether OCGemployees might not feel more as if they belonged to a subsidiaryof Olin. From the CIBA-GEIGY perspective, information is providedto OCG employees through an Olin source, with no opportunity forinput from the second parent. The manager from CIBA-GEIGYobserves,143It was never in my recollection discussed who would bethe main communication partner or would we both[communicate with OCG]. So it seems as though Olin,because they were to provide the services, had found away to wrap OCG into their network of communicationsabout general Olin information. On the other hand CIBA-GEIGY does, I think, nothing to wrap them in on thisside. The idea I thought strategically at the outset wasto have all these employees [at OCG] feel like a standalone venture. My belief is the Olin strategy ofwrapping them into their newspaper is going to have themfeeling longer term like a subsidiary of the OlinCorporation...and not an equal partner with CIBA-GEIGY.Although one manager notes there would be an additional cost inproducing a newsletter for OCG, there may also be some benefits tothis related to the creation of a more secure identity foremployees in the joint venture. A manager at the Ardsley operationsuggests the merit of a separate OCG newsletter which incorporatesitems from both parent newsletters, when articles are relevant andaffect OCG.b) Linking International OperationsTo this point, communication systems as they operate withinthe Eastern U.S. component of OCG have mostly been considered. Onan international level as well, OCG uses a variety of mechanisms tolink its various locations. There are \"world-wide meetings\" whichtake place twice per year, and which are three to five days induration. These meetings are attended by the business managersrepresenting Europe, U.S. and Japan. Senior managers are inattendance from sales and marketing, R&D, and in some cases a boardmember will be present. Participants review progress, look at thecompetitive market situation and consider future plans for OCG.There are international teleconferences held approximatelyevery two weeks among cross-functional teams. The teleconferencesnot only link the North American and European operations, but are144held between OCG and Fuji-Hunt as well. Kenji Honda who is asenior scientist at OCG describes he operates in a liaison rolebetween the Japanese company and OCG. He observes the languagebarrier is significant, and slides are often used to simplifycommunication. Fluent in both English and Japanese, Kenji Hondasometimes translates reports from Japanese. He comments simpletranslation is not sufficient, and stresses it is also necessary tocapture the underlying meaning or intent of the text. This OCGemployee notes it is important to recognize the culturaldifferences which exist between Americans and Japanese, and toacknowledge the different cultural philosophies which operate ineach group. He adds telephone and fax are not adequate to createunderstanding across cultures, and advocates the necessity to meetface-to-face. Kenji Honda participates in the world-wideconferences and expresses these are an important mechanism forcommunication among employees who are in different locations, andwho represent divergent cultural backgrounds.4. The Performance Management ProcessThe Performance Management Process (PMP) is a system adoptedfrom Olin to OCG. The purpose of the PMP is to link employeeperformance with the total quality program which operates in bothOlin and OCG. Employees determine internal and external customerexpectations and then set personal or team goals to meet thoseexpectations. Generally, the aim of the process is to improveperformance, and employee progress is monitored. The PMP is a formof employee performance appraisal or review and all employees inthe company participate. The program applies to operations in145North America and in Europe.As part of the PMP, employees meet with their supervisor anddetermine primary customers. Feedback is obtained from designatedcustomers related to their current expectations, whether or not theexpectations were met, and what is required for the future.Employees are not rated on a point system for performance, butrather whether or not they meet customer expectations related tothe determined objectives. Both technical and interpersonal skillsare considered. The HR manager explains the purpose of theemployee reviews also has a developmental component. The processallows supervisors to know about employee objectives for careeradvancement, or of additional training which may be required. Theoriginal PMP was designed in a manner which was too complex toadminister and communicate. As a result, a task force was assignedto make recommendations as to how the PMP can be simplified forhourly employees.Currently, the PMP does operate in practice at OCG, but todiffering degrees. Performance reviews are not returned to the HRmanager by supervisors, and subsequently it is difficult todetermine who is completing the process, and to what level ofeffectiveness. One manager who is located at the headquartersoffice remarks performance reviews tend to be more informal thanformal. In his view, PMP is not used consistently and he mentionsif the process is to be effectively implemented, a \"top down\"approach will be required which is tailored to the uniquerequirements of OCG. In the East Providence manufacturing plant,employees have been informed of the goals of the PMP, and how it islinked to the Quality Management Program. One hourly employee146describes he had been to a local hotel for two half-day meetingsduring which the PMP was explained. In R&D at the East Providencefacility, one of the managers in the research group comments goalswhich are set for individuals or teams are reviewed at the nexthigh level to ensure the goals fit with those of the department.According to him, not everyone had yet implemented the system. ThePMP system has begun slowly in Europe, although it is currently inoperation.5. Reward and Recognitiona) RewardsOCG operates a number of reward and recognition programs toencourage employee performance. The HR manager explains OCG aimsto be competitive in the area of salaries. Under the Hay system,and using Olin criteria, a national survey is done periodically toensure Olin (and now OCG) salaries are in line with those of otheremployers. The objective of rewards is to attract, retain andmotivate staff. An employee's manager decides the amount of meritincrease. A reward of an additional one-half to two months salarymay be given as a bonus to employees who excel. The bonus couldapply to groups as well as to individuals. An incentive schemewhich had existed in the Olin Corporation for senior managers only,has been made available to both senior and mid-level managers atOCG. This scheme remains to be communicated to mid-level managersat all locations, and some of the eligible managers at the EastProvidence location did not yet know the details of the incentiveprogram. Recently, awards have been established for specialachievements and technological and commercial accomplishments.147These awards are substantial cash amounts and apply to either teamsor to individuals. In addition, Quality Awards of smaller cashvalues have been initiated for employees who demonstrate qualityperformance.Safety and attendance awards exist for hourly employees. Ifan individual has no lost time due to accidents during a quarter,he or she will receive twenty-five dollars for that period. If anentire department has no lost time from accidents for the year,each employee receives an additional 150 dollars. As one employeedescribes, he had broken his thumb the previous year and was offthe job for eight weeks. This prevented all employees in hisdepartment from receiving the safety bonus. This employee feelsonly the individual should lose the bonus and adds some people arenot reporting injuries to avoid embarrassment for causing others tolose the bonus. Maida Garabed is aware of the problems with thispolicy and plans to form a task team to consider the safetyincentive awards.A unique feature of OCG during the start-up phase is theleasing of CIBA-GEIGY employees to the venture. Under thisarrangement, all the Ardsley employees and 3 employees inSwitzerland who are designated as OCG employees remain on the CIBA-GEIGY payroll and benefits. This expense to the parent company isbilled back to OCG. Once the Ardsley group, for example, move toEast Providence they will be integrated into the OCG compensationpolicy and payroll system. Alternately, formerly Olin employeeswho are now in OCG are not leased, but are under the OCG system.Apparently the discrepancy in policy for the two groups resultsfrom regulatory characteristics and a desire to avoid a multi-148employer pension plan. For the formerly Olin employees this posedno problem as they were already on the Olin pension plan, andbasically continue on the same plan. The former CIBA-GEIGYemployees must remain leased until OCG establishes its own pensionplan.b) RecognitionIn addition to financial forms of compensation, OCG managementplan to expand nonmonetary recognition for employee achievements.A number of people mentioned CIBA-GEIGY has a good recognitionprogram currently in place, and the intention is to includeelements of that program in a package specifically designed forOCG. Already noted, there is a task force considering recognitionfor OCG employees. As part of the newly expanded program, a columnin the employee newsletter highlights individual or groupachievements. At Ardsley, a recognition dinner held to honoremployees for their contributions was attended by the joint venturepresident and two of the vice-presidents. At East Providence,pizzas were ordered to the work site to celebrate a record amountof production for the month. One employee at East Providencesuggests there should be an \"Employee of the Month\", and dinnercertificates in recognition of efforts. Some forms of recognitionexisted prior to the formation of OCG, (i.e. annual patent dinners,retirement parties, and gifts awarded for length of service), andwhich will continue.1496. Staffing and Promotiona) RecruitmentOCG was initially formed from previously Olin or CIBA-GEIGYemployees who were transferred into the venture. Most of the Olinpeople designated for the JV were already in place at the EastProvidence location and remain there. In the case of CIBA-GEIGY,people were required to relocate to join the venture. Most of theEuropeans refused to leave the parent company for OCG; Ardsleyemployees basically had no alternative but to join the venture.Further, employees are not be able to bid back to the parent firmsfor a two year period. In the case of a marketing and technicalsupport group in California, most were offered jobs at the OCGbranch in Arizona, and everyone who was asked to relocate refused.Consequently, many of the CIBA-GEIGY staff originally identified tobe part of the OCG venture resisted this option.As new staff are required, OCG will follow the Olin initiativeand rely primarily on internal recruitment, rather than hiring fromoutside the parent companies. At this point most new hires arelikely to come from the Olin Corporation. The HR Manager explainsOCG positions are posted corporate-wide within Olin and Olin Hunt,but not within CIBA-GEIGY. According to the HR Manager, \"CIBA saidwe were the minority at least as people are concerned. You don'thave to post the positions.\" However, one of the CIBA-GEIGYexecutives found the policy of not posting jobs in the secondparent quite surprising. He remarks \"it was my belief thatfuturistically that both Olin and CIBA-GEIGY employees would haveopportunities to bid into the joint venture.\" The executive admitsOlin is more likely to have people who have greater experience in150the photoresist side of the business, but that this should not be\"an excuse for why the jobs aren't posted here\". Despite thispolicy, over time there may be more staff at OCG who bid in fromCIBA-GEIGY. OCG President Jim Favier commented as the businessgrows he hopes to bring people in from both Olin and CIBA-GEIGY atlower managerial levels. It was his view more CIBA-GEIGY peopleshould be hired into OCG.In the East Providence plant, one manager says he would preferto hire qualified personnel from each of the parent companiesrather than to hire externally. In the past, people from outsidethe company would be hired on a temporary basis for hourlypositions, and based on their performance would be permanentlyhired. The production manager explains he does hiring inconjunction with the foremen. There is currently not a system inplace which designates hiring and interview criteria, although theHR manager is considering this issue. In most cases, jobs areposted in the plant although there have been some exceptions. Newhires receive a safety orientation and a tour of the plant.Staffing of key management positions was done before theofficial signing of the joint venture contract. The President camefrom Olin and had extensive experience in the microelectronicsbusiness. When he joined the joint venture, members of hismanagement team at Olin came with him, although not in exactly thesame roles. The most senior positions in the venture are splitbetween Olin and CIBA-GEIGY.b) Employee TransfersSince the JV start-up there have been few instances oftransfers between the various locations of OCG. To some extent151this is because the venture is still so new. However, in theresearch group at East Providence, a program has started which doesallow for the transfer of some personnel. The product manager,Michelle Robeson points out some people have been exchanged betweenthe St. Nicholaus technical services centre and East Providence,and between the Tempe customer support centre and Shizuoka inJapan. Staff from R&D in East Providence will have futureopportunities to go to Basel to do basic research. She adds moretransfers should be available to staff in order that they can gainbroader skills and a better understanding of the business on aninternational level.c) PromotionsAgain, due to young age of the venture there have been fewpromotions. The HR Manager states the basis of promotion is anemployee's ability, rather than seniority. In addition totechnical skills, interpersonal skills are equally important.Presentation skills and the ability to work as a member of a teamare also taken into account. Management reviews are done at yearend and suitable upward positions for managers are considered atthis time. The reviews take place between a manager and the personto whom he or she reports.d) Qualities of JV ManagersConsidering the qualities important in OCG managers, oneindividual suggests managers should be both aggressive andentrepreneurial, in keeping with the market niche the company hascarved for itself. The Director of R&D at Ardsley thinks it isimportant joint venture managers are resilient and patient. Theymust also have good communication skills and interpersonal152relationship skills. He adds when you are working with staff whocome from different backgrounds and approaches, (i.e. as occurs ineach parent company), it becomes critical to understand people'sapproaches and motivations. In joint ventures, a manager needs \"tomaximize what you can do yourself and what you have your parents dofor you. So your managers who will be successful, I think, have tounderstand their own culture, both parent cultures, and where theycan make use of them\". Along this line, a manager who wasrecruited from Olin notes the importance of being open to what bothparents can offer to the venture. He expresses \"it would be veryeasy for me to close my eyes and say, well I'm used to doing itthis way, and we're going to do it this way [here]. So I thinkbeing open to those things, being willing to change. And havingthe ability to help other people who are not so willing to change,to help them to change.\"The Vice-President for HR at CIBA-GEIGY U.S. comments an HRmanager in a joint venture would ideally have a breadth ofexperience in multidisciplinary settings, for example in differentindustries, or in the same industry but at different levels of aplant or division. This person should prefer adaptability, ratherthan predictability. He continued when there is an internationalcomponent, the HR manager should have international experience andexposure. Multiple language skills to match those of the nationalorigins of the parent companies would be desirable.1537. Training and DevelopmentThere is substantial emphasis on training for managerial,supervisory and administrative staff at OCG . A wide variety ofcourses are offered primarily through the Olin training facility atStamford. A list of the training packages offered at Stamford issent to employees twice a year. Training is provided in TQM,interpersonal skills, teamwork, supervisory skills, report writingand software training, among other things. In addition to theinternal (Olin) training programs, OCG employees are encouraged toattend external training for which the company pays in full.Little technical cross-training exists between OCG and the parents.One manager explains this is because OCG already has staff who arestrong in the microelectronics business who have moved there fromthe parent organizations.The HR Manager, Maida Garabed, identifies training needs forthe organization and then implements the necessary trainingprograms. For instance, Maida identified a lack of supervisoryskills in some of the staff at East Providence, and supervisors andhourly lead people did receive training in this area. In the R&Dgroup at East Providence, a manager in the research area said 80 to90 percent of the time people can attend courses which they choose.Most of the training received by hourly employees at EastProvidence is on-the-job. There is a manual of standard operatingprocedures for all the jobs in the plant and every employeereceives a copy. When learning a new job, employees andsupervisors complete a skills checklist to ensure skills have beenacquired. Safety training is a priority. Beyond on-the-jobtraining there is little additional training available for hourly154employees. One line worker mentions he is currently working mostSaturdays and many ten hour work days and that there is no timeleft for training. A need for computer training was identified forsome of the hourly employees and they are to receive this trainingsometime in the future.Some retraining is offered at the plant level. To eliminatethe cultural barriers between the R&D and manufacturing groupscross-training between departments will be initiated. This alsoserves to expand employee skill bases. Job rotation exists incertain areas such as packaging, so employees can train, and thenalternate, among the various jobs in that area. As equipment inthe plant changes and becomes more sophisticated, the maintenancestaff will receive skills upgrading.D. Results of the Employee QuestionnairesThirty three people responded on the two questionnaires. Thisincluded 9 females, 19 males and 5 unknown. The average age ofrespondents was 39.0 years, with a standard deviation of 9.92years. Three employees who responded had not completed highschool, 2 had a high school education, 15 had a Bachelors degree orsome college, 3 had Ph.D degrees. Related to how long employeeshad worked at OCG, the length of time indicated was 8.19 years,with a standard deviation of 6.83 years. As OCG was less than oneyear old when the questionnaires were completed, it is apparentrespondents referred to the length of time they had worked for thecompany when it had previously been Olin Hunt and before thatPhilip A. Hunt. Eleven respondents reported they had no daysabsent from work in the previous year.1551. Minnesota Satisfaction QuestionnaireMean scores and standard deviations for each item of theMinnesota Satisfaction Questionnaire (MSQ), aggregated across allrespondents appear in Table 5. Aggregated mean scores for overalljob satisfaction and scores for intrinsic and extrinsic categoriesare also listed. The percentile score for overall satisfaction is70.69 and falls somewhat below the 75th (or higher) percentiledesignated in the MSQ manual as the relative cut-off point for ahigh degree of job satisfaction. Standard deviation of theresponses is 13.14 which represents wide variation in employeeresponses around the mean. Percentile scores are fairly high(76.87) for intrinsic satisfaction and moderate (60.30) forextrinsic satisfaction. Referring to Table 5 these scores arerepresented as aggregated mean scores out of a maximum score of 5for a single test item. More specifically, respondents gainintrinsic satisfaction from being able to keep busy (4.27) and workalone (4.21). They indicate they have a chance to do differentthings (3.93) that don't go against one's conscience (4.03) and aregiven the chance to try their own methods for doing a job (3.81).There is a relative degree of feeling accomplishment from the job(3.76). Related to extrinsic satisfaction, employees did not likethe way company policies were put in practice (2.57), nor did theylike their salaries relative to the amount of work performed (2.94)and the chances for advancement (2.81). Employees indicated theyreceived little praise for doing a good job (2.93).1562. The Culture InventoryResults of the Culture Questionnaire appear in Table 6. Aswith the results of the MSQ, scores are represented as aggregatedmeans for each item of the questionnaire. Mean scores are alsolisted for each cultural category represented on the inventory:group, developmental, hierarchical and rational cultures. Inaddition, the overall score for the questionnaire is listed. OCGemployees scored highest on the rational culture category (9.99),indicating some focus in the company on achievement, production andtask accomplishment. Based on the results there is not strongevidence for either a hierarchical culture demonstrated through anemphasis on rules and order (8.49), or a developmental culturewhich typically nurtures innovation and creativity (9.11). Thelowest score is in the group culture category (7.14). Thiscategory considers whether respondents view OCG as a personal placeto work, with an emphasis on human resources.3. Guide to Human Resource Management PracticesThe Guide to Human Resource Management Practices was completedby Maida Garabed. As the only HR person attached to OCG in NorthAmerica, she expresses her opinions of how various personnelpolicies operate in the venture. Of interest, Maida indicates manydualities of HR philosophy exist at OCG. For example in the areaof planning, she notes planning is both formal and informal basedon both a short-term and long-term focus. There is an emphasis onplanning at both a group and an individual level. In her opinion,planning has high employee involvement, a high risk-taking focusand is integrated with the plans of other departments.157Table 5Results from the Minnesota Job SatisfactionQuestionnaire at OCG MicroelectronicsAs Aggregated Scores Across All RespondentsItem Mean SD1. Able to keep busy 4.27 .802. Chance to work alone 4.21 .703. Chance to do different things 3.93 1.064. Chance to be somebody in thecommunity3.45 1.035. Way my boss handles people 3.18 1.166. Competence of supervisor'sdecisions3.64 1.327. Able to do things that don'tgo against my conscience4.03 .888. Job provides steady employment 4.03 1.139. Chance to do things for others 4.00 .8810. Chance to tell people what to do 3.33 .9611. Job makes use of my ability 3.57 1.3912. Way company policy is put intopractice2.57 1.0913. Pay related to the amount of work 2.94 1.2714. Chance for advancement 2.81 1.3115. Freedom to use my judgement 3.72 1.2116. Able to try my own methods 3.81 1.1017. The working conditions 3.48 1.0618. The way coworkers get along 3.00 1.3019. Praise for doing a good job 2.93 1.1720. Feeling of accomplishment from thejob3.76 1.00Aggregated Category ScoresMean SD PercentileIntrinsic Job Satisfaction(items 1-4,^7-11,^15,^16,^20)46.12 6.94 76.87Extrinsic Job Satisfaction(items 5,^6,^12,^13,^14,^19)18.09 5.61 60.30Total Job Satisfaction 70.69 13.14 70.69(items 1-20)158Table 6Results from the Culture Inventoryat OCG MicroelectronicsAs Aggregated Scores Across All RespondentsItem1. A personal place2. Dynamic and entrepreneurial3. Formal and structured4. Production-oriented5. Loyalty and tradition6. Commitment to innovationand development7. Formal rules and policies8. Tasks and goal accomplishment9. Emphasis on human resources10. Growth through new ideas11. Permanence and stability12. Outcomes and achievementMean SD2.27 1.102.18 1.042.73 1.153.48 1.092.39 1.143.48 1.122.85 1.373.09 1.212.48 1.253.45 1.152.91 1.443.42 1.12Aggregated Means for the Culture CategoriesGroup Culture 7.14Developmental Culture 9.11Hierarchical Culture 8.49Rational Culture 9.99Total Score 34.73159In the staffing area, internal recruitment prevails. Thereare few career paths, due to the policy employees may not bid outof the venture to the parents for a period of two years. Accordingto Maida, hiring and promotion criteria are clear and stated andcareer path information is available. Discrimination based ongender or social class is low. There is extensive overtime at boththe East Providence and Ardsley facilities. Orientation sessionsare in use for new employees.Performance is based on both behavioral and results criteriaand evaluations consider the total person as well as performance.Employee performance goals are both long-term and short-term, andgroup criteria as well as individual criteria are used. Employeeparticipation is high, and there is explicit feedback provided toemployees as part of the evaluation. Promotion is moderatelypaced.Low base salaries exist for some staff groups, but otherwisesalaries are competitive. Compensation packages are standard andfixed. Bonuses, wage increases or reductions are individuallybased. Rewards tend to be open rather than secret, according toMaida, and are available to only certain managerial staff in theorganization. Incentives are both short-term and long-term. Thereare many financial and social \"perks\".Training is short-term, and can be both broad and specific innature. Training is provided both internally and externally,and can be either on-the-job or in the classroom. There is a grouprather than an individual orientation.^Employee input intotraining programs is low, although Maida notes this has increasedin the last three months.160E. Summary of the Results1. OCG is a small microelectronics company which supplies qualityproducts to the semiconductor industry. Formed in January1991, it is an example of a \"triad alliance\" with R&D,manufacturing, customer service and marketing capablilites inall three major electronics markets of the world. The companyaim is be be the #1 supplier to the international market by1995. Currently OCG ranks #3.2. The JV brings together unique technologies of the parentfirms, allowing OCG to have microelectronic capabilitiesgreater than either parent would have alone.3. In the original JV agreement, various support servicesincluding those in the human resource management area werecontracted from Olin. Subsequently, Olin HR policy andpractices have been primarily adopted in OCG, although some HRpolicies are under review, and will be specific torequirements of the joint venture. This arrangement reducesinput and control by CIBA-GEIGY related to the HR function atOCG.4. Ninety percent of OCG employees are formerly from Olin and theremainder are from CIBA-GEIGY. Currently, the CIBA-GEIGYgroup remain in the parent facilities and are leased to theJV. One of the major challenges for HR is the successfulintegration of the CIBA-GEIGY minority into OCG.5. The aim of OCG is to be entrepreneurial and customer-orientedin order to produce innovative, quality products for thesemiconductor industry. This goal is facilitated through a161Total Quality Management Program. This system emphasizesknowing and meeting customer requirements, as well as employeeinvolvement in the product improvement process.6. The HR role is central to meeting the quality goals set atOCG. The HR Manager was involved early, before th JV contractwas signed, and remains proactive and integral in creating HRpolicy to meet the business demands of the company.7. The HR function at OCG aims to build a unified culture for theJV. This task is made difficult by the need to a) integratepreviously CIBA-GEIGY employees into the operation; b) bridgecultural differences between R&D and manufacturing; and c)create connections between the various decentralized units ofOCG, both in the U.S. and globally.8. OCG uses a wide variety of communication mechanisms, (i.e.task forces, teleconferences, and meetings), in order to linkits diversely located operations.9. A Performance Management Process exists at OCG which connectsemployee performance with the total quality program. Thisprocess exists for all employees and is a form of review whichevaluates employee performance related to being able to meetcustomer expectations.10. The management staff of OCG are expanding reward andrecognition programs offered to employees.^Currently,monetary incentive plans which are tied to performance existfor some managerial staff.^The recognition system iscurrently under review in order to offer all employees greaterencouragement for their efforts and contributions.11. Staffing is internally focussed. Job postings operate, and to162date are posted corporate-wide with Olin operations, but notwithin CIBA-GEIGY. OCG employees are to remain in the JV aminimum period of two years before being allowed to bid backto either parent company for employment.12. Numerous courses are available to salaried employees,primarily through the Olin training facility. Training forhourly employees is currently under expansion.13. Employees view OCG as focusing primarily on achievement andtask accomplishment. They tend to view the company as somewhatimpersonal, with an underemphasis on human resources.14. In general, employees at OCG express a fairly high level ofjob satisfaction, and indicate they are able to workautonomously. However, in general, employees are not in favorwith the way in which company policy is put into practice.163CHAPTER SIXOPTIMA CORPORATIONSA. Joint Venture Background1. History of the VentureFormed in 1977, Optima Corporation is a joint venture equallyowned by Fiberop (50%) of the United States and Bauer GmbH (50%) ofGermany. Optima is currently the world's largest independentmanufacturer of fiber optic cable; the company also makessupporting components such as cable connectors and electro-opticproducts. These commodities are used in increasing quantities intelephone networks, cable-television systems, as well as in otherareas of the telecommunications industry. Optima internationallymarkets fiber optic cable and strives to be a total qualitysupplier which consistently meets customers' requirements, on timeand without defects or errors. The corporate office for thecompany is located in a small town in the Eastern United States.Manufacturing is undertaken at four plants. Two plants are withinseveral kilometers of the corporate office, and primarilymanufacture fiber optic cable. The other plants make elevatorcontrol cables and related support equipment which is sold to thetelecommunications industry. Optima also has a distribution centerand regional sales offices. Taking into account the employees inthe optic cable areas, Optima has approximately 1250 nonunionizedstaff.3 At the request of the joint venture management, they preferthe company name and identity of individual respondents remainanonymous. In keeping with this request, the joint venture name aswell as the names of the parent companies are fictitious. The JVis located in the United States.164The parent companies contribute complementary expertise to thejoint venture. Bauer is an international manufacturer oftelecommunications equipment, electrical and electronic componentsand subsystems. It provides technical expertise in cabledevelopment to Optima, and has designed much of the equipment usedby the joint venture in the cable manufacturing process. Technicalstaff are transferred from Bauer to Optima on a temporary basis toassist in the implementation phase of new equipment or technology.The other parent company, Fiberop, is a world leader in thedevelopment of high grade optical fibers. Fiberop is the primarysupplier of optical fibers to the joint venture. In addition, anumber of the management policies and procedures have been adaptedfrom the American partner. In the early stages of the jointventure, many of the executive management group were transferred toOptima from Fiberop's organization.2. Management of the VentureThe Board of Directors for the joint venture consists of eightmembers, four from each of the parent companies. The Chairman ofthe Board is from Fiberop. (In a second joint venture between theparents located in Germany, the reverse arrangement prevails, withfour board members from each parent and the Chairman from Bauer).The president of Optima reports to a Fiberop executive in thetelecommunications division. The joint venture president does notreport directly to the JV board, although the Fiberop executive towhom he reports does. In the U.S., management of Optima isprimarily guided from Fiberop, and the technical support isprovided by Bauer. Board meetings for Optima occur every 90 days165and alternate between the U.S. and Germany. Major capitalexpenditures for the joint venture require approval from the Board.Optima does not function with an advisory committee, which servesto define issues for the joint venture and then reports on JVprogress to the Board of Directors. There is however, a planningprocess which operates under the direction of the upper managementgroup in the joint venture. Plans for Optima are developed by thisexecutive group and then reviewed by the parent companies.Although the influence of both cultures exists at Optima, thegreatest impact on the joint venture is from Fiberop. This occursin part due to the agreement by the parents to allow Fiberopmanagement control in the North American venture. In addition, thelarge representation of upper level managers at Optima, whooriginally came from Fiberop, continue to influence the strategicorientation of the venture. As one manager remarks, \"it's probablytrue to say that from a general standpoint the number of parentemployees that are brought in [to the JV] probably has a biginfluence on how, and how fast the joint venture grows, what itlooks like, and what kind of culture it has.\" Related to this,much of the focus on total quality manufacturing, and more recentlya move toward employee high involvement systems in themanufacturing plants, has been infused to Optima through itsFiberop connection. As already noted, Bauer primarily provides thejoint venture with technical advice and training on new equipment.In the area of human resource management, managers have mixedopinions as to how much influence on policy and practice derivesfrom Fiberop, and how much of HR functioning is created for theindividual requirements of Optima. One senior manager, who feels166there is a significant influence from Fiberop comments,There's a much stronger influence on our organization byFiberop than there is by Bauer, and Fiberop has a valuestructure that they make a strong effort of disseminatingdown through all parts of their organization...But whenit comes to passing on information and systems issues,there does occur a lot of conflict in the sense thatthere are times when within the [Optima] organization itis perceived that Fiberop is trying to impose theirparticular HR systems on us. Not for our benefit, butfor theirs.Another manager adds there is a benefit to Optima in being able toabsorb or adapt HR policies from a parent company. He explains itis less costly to use materials originally produced at Fiberopwhich are already prepared, and well conceived. In his view,Fiberop does not put any pressure on Optima to use their HRpolicies. HR staff at Fiberop operate in a support role, andprovide assistance at the request of the management at Optima. AnHR manager mentions much of the influence on personnel policies wasderived from the quality focus central to operations at Fiberop.This individual notes, \"Fiberop has said, and rightfully so, thatwe expect Optima to introduce, implement, and adhere to the wholequality process the same as Fiberop does. Now did that have to bequote forced on us, the answer is no.\"Despite the assistance provided by the parent companies,Optima aims to operate in an autonomous fashion. One plant managerwho had been in the joint venture since the beginning remarked \"Idon't ever remember it being written down or somebody coming outand making a statement, but the sense you got being here was thatit was the intention that we would strive to be autonomous. Andthat was the direction we headed.\" Members of the management staffexplain they have learned and benefited through the associations167with the parent companies. That relationship has changed overtime. A Director at Optima remarks that in the beginning, thetechnology for the venture was supplied by Bauer and the fiberproduct by Fiberop. Now Optima is at the point where \"we'vemanufactured so much more cable than Bauer that we're in a positionof teaching and learning\". He adds this was \"an interestingbyproduct of the relationship. Nobody anticipated it\".Optima's success is reflected not only in its market share butin the confidence which customers express toward the company. Inthe headquarters office, an open area displays a series of plaquesand awards given to Optima by various customers for exemplaryproducts and service. Although Optima does not intend to competeformally in the Baldridge competition, the company has decided tocomplete the necessary criteria to qualify for the award. Themanagement at Optima have hired examiners to test them against theBaldridge criteria. In the past year Optima is the first non-Japanese company to be given a development contract to supply cableto Japan. One manager observed \"it's a big achievement; we're realpleased with it\".A Vice-President and General Manager at Optima adds employeesin the JV tend to be \"very young, very aggressive, very open andcreative people that are customer oriented\". He states,Optima has gone from virtually nothing to, in the cablebusiness, an equal share with AT&T. It's a real successstory when you think we were nothing and now we've got athird of the market. We got there by being creative, bybeing responsive, and I think everybody understandsthat's the key to our survival.168B. Strategic Orientation1. Achievement of the Quality GoalSimilar to many other successful companies competing with aglobal focus, Optima pursues a Total Quality Management system.This system has been largely adopted from Fiberop and is based onMilliken's philosophies. Essentially the quality statement servesas the primary mission statement for Optima. It reads,Optima's Quality Policy is to achieve Total Qualityperformance in meeting the requirements of external andinternal customers. Total Quality performance meansunderstanding who the customer is, what the requirementsare, and meeting those requirements without error, ontime, every time.Built into the quality philosophy, employees are encouraged toproduce high quality products and to learn to prevent errors anddefects. This is to be accomplished through management andemployee commitment to problem-solving, corrective action, and themeasurement and assessment of quality.A Corporate Quality Steering Committee operates as the policycommittee for the implementation of quality strategies. Thiscommittee consists of the departmental vice-presidents who providethe overall direction and guidance to the company. At the nextlevel, Quality Improvement Teams are responsible for theimplementation of the Total Quality process. Each operational areahas a QIT which functions to identify projects to be undertaken toenhance quality. For example at the plant sites, the plant managerand his immediate staff form the team. Corrective Action Teamswork to solve problems which have been identified by the QualityImprovement Team. Solutions are based on determining causes of a169problem, data collection, solution searching and implementation.Error rates are displayed using graphs and other visual techniques.Employees are to be actively involved in the quality process.To encourage involvement and \"ownership\" of the process, themanagement of Optima provide education and training in the qualityconcept. In addition, there is a company emphasis on vertical andhorizontal communication, a team approach and recognition ofemployee achievements and contributions toward the quest forquality. There is evidence of the quality approach in action atboth the corporate office and the two plants investigated in thisresearch. At corporate headquarters the personnel office has alarge board on the wall on which are listed items for action in thedepartment. Communication is emphasized and there are variousinformation meetings initiated by the personnel department to keepemployees informed. To varying degrees recognition programsoperate.According to some managers at Optima, the creation of a systemwhich truly involves and empowers employees has been initiated morefrom the plant level than from the vice-president and directorlevels. One manager remarks,Our vision is to be the market leader in our business intechnology. And we're going to do that through the totalquality process and I think the people, not necessarilyat the top of the organization, but at the middlemanagement level and down would say we're going to dothat by empowering people...I'm not sure all of them[upper management] are convinced, or that theynecessarily understand what that means. I think to someextent to people who grew up in a traditionalorganization, empowering people at lower levels in theorganization to make decisions traditionally made by themor middle managers is very threatening. Because there'san element of job security that seems to disappear inthat.170In theory, then, Optima aims toward the establishment of highemployee involvement systems, but is currently in the formativestage of implementation of the concept.A redesign program underway at both Plant 1 and Plant 2focuses operations toward providing greater autonomy andresponsibility to employees. Within the last 2 years Plant 1 hasexperimented with work cells and minifactories in which employeesare given responsibility for the completion of units of work fromstart to finish. In addition, employees are to be given themandate to do peer reviews, selection into their groups and todevelop their own recognition procedures. Plant 2 plans toimplement a similar process, but is currently in the preliminarystages of doing so. Quality Improvement Teams and ContinuousImprovement Teams operate in both plants.Following the quality mission statement for Optima, Plant 1has developed its own mission statement. It is,We will be the cable supplier of choice by understandingand meeting our customer's changing requirements ofquality, cost, and service. This requires an eagernessto change and the ability to make rapid, continualimprovement.Underneath the mission statement and appearing on a single page arelisted a number of items which the plant personnel believe areessential ingredients of a quality program. In addition toconsiderations of creating quality products and meeting customerneeds, there is an emphasis on the importance of creatingmeaningful work environments. This is expressed in Plant 1 by thefollowing statements related to the plant mission:1. Educated, empowered, enthusiastic, and flexiblepeople are the competitive advantage.1712. A team-based environment is fundamental to our success.3. Everyone will be treated with dignity and respect.The management of Plant 2 likewise intend to create a missionstatement unique to the goals of the plant. In addition, there iscurrently consideration that each work team within the plants willcreate their own mission statements. This will serve to make morespecific and meaningful the goals of each work team, while stilloperating within the overall framework of a total quality system.One plant manager describes the past and current strategicorientation at Optima in the following way,We've gone through phases and in the initial phase wasprobably technical strength. In the early eighties wehad the best fiber optic product. I think in the lateeighties, we had fiber optic products that were as goodas anybody else's, maybe a little better here and there,but there's a lot of good products...but I think thedifferentiation has been our quality and our service.And I think that's the thrust that we think we need tocontinue, to take it to the next level.This individual continued it used to take six to eight weeks toship products and now in some cases it may take 48 hours.Consequently, staff at Optima need to be able to rapidly respond tochanging customer needs within their manufacturing operations. Thecompany must to be able to change product volumes and to have shortlead times. Products are required to be transferred more quickly.To accomplish these tasks, the manager adds to his abovestatements, \"I believe the only way we can do it is to graduallychange the culture of the people from one where we've not askedthem to use their brains much, to do busy work, to one where theyfeel they own the business\".172C. Human Resource Management at Optima1. The HR Departmental RoleThe HR function at Optima is represented at several levels.At the highest level at the corporate office there is a Vice-President of Personnel who operates in an equivalent position toother vice-presidents in the company. Also located at corporateheadquarters is a Personnel Manager responsible for the needs ofadministrative and managerial staff. In addition, the Manager ofEmployee Relations deals with issues pertaining to hourly andtechnical staff rather than with exempt, supervisory employees.Among other things, his role is to deal with legal issues,employment related charges and discrimination. There is aPersonnel department which reports to the Manager of EmployeeRelations. Employees in this department are primarily responsiblefor internal communications, worker's compensation and safety,recognition policies, company social functions, job evaluation,benefits, and compensation. Each plant has a Personnel Manager.The human resource management function is considered centralin the strategic business planning process at Optima. The seniorVice-President of Personnel is part of the executive planning groupwhich meets with the JV President on a weekly basis to chart thecourse for the company. In referring to the HR function, one vice-president remarks the Personnel Vice-President is in a \"position tosee what's coming months ahead of anybody else...we people plan [inthe executive sessions] once a week in a macro sense\". He adds thePersonnel Vice-President is \"very active, very proactive in termsof causing the management to make decisions about people\". Another173executive who participates in these weekly management meetingsremarks the first thing they do in the meeting is to look at\"nosecounts\" and the company standing on safety and other personnelissues. He mentions personnel is an \"integral part of thebusiness\". This individual adds he thinks HR is primarily drivenfrom a profitability standpoint, and every employee represents$100,000 in associated costs.Related to the strategic role which HR has at Optima, one ofthe personnel managers comments,One of the things we [personnel] are doing with ourbusiness plan is that we're driving more of the peoplepart into that plan, which in previous years we didn't dovery much of that. So in today's environment I think ourrole is to ensure that we have the kind of resources weneed to meet the business conditions...I must say thatour people part of the company, the personnel piece ofthe company is an integral part of the whole businessplanning process...This gives us an opportunity to lookat the business in terms of labor cost, in terms of allthose kinds of costs that we have in terms of our wageand salary structures, our benefit plans.Another personnel manager sees an additional piece of the HR roleas \"changing and/or emphasizing the company value system\". Thismanager elaborates the important issues for Optima are quality,employee involvement, team-based manufacturing and administration,diversity, safety, and compliance with environmental regulations.He sees personnel in the role of \"initiator\" of policies which meetthe company goals. In the process of redesigning strategies toenhance employee involvement, members in the HR department can actas catalysts to expose line management to different modes ofthinking related to work relationships.At each plant personnel is given autonomy to create HR policyto meet specific plant requirements, while retaining the174overarching strategic direction of Optima. For policies which arecentrally controlled like pay and benefits, the personnel managersin the plants do have the opportunity to provide theirrecommendations. One plant manager observes,At the plant level, we pretty much decide here what we'regoing to do. Now as things tend to become perhaps alittle more of a departure from our history, we obviouslytalk to corporate personnel and have a lot of interactionthere. For example, the trend has been to reduce thenumber of job classifications in the plant area and we'vekept in touch obviously with the corporate group to keepus honest and make sure they don't have heartburn withsome of the things we're proposing.The personnel managers at both plants are actively involved in theredesign of the plants to become more participative teamenvironments. As one personnel manager in the plant comments, hisrole is \"part of the plant leadership team, to develop the plantculture, to work to ensure the team activities give us the resultswe're looking for. To make sure that we don't violate any of thewage and hour...guidelines and laws. To help to develop thestructure long-term that is going to make us successful.\"In general, the joint venture has the opportunity to borrow HRpolicies from the parent companies, in this case primarily fromFiberop. As one personnel manager explains,The one thing we have been able to do at Optima, whichrelated to a company our size as compared to Fiberop orBauer, is that we've been able to draw on the resourcesof both of those companies. We have been allowed to usesystems of theirs if we chose to use them without thembeing driven down to us. So that's been a tremendousadvantage and resource for us to be able to do that.Some of the things that we have chosen to do the same --more of Fiberop than Bauer.Personnel managers from Optima participate in conferences in thehuman resource area which are organized from Fiberop. Throughnetworking between the personnel staff at both Optima and Fiberop,175HR policy information is exchanged informally. Although Bauer doesnot currently have HR conferences, the company is considering thisalternative. If this were to occur, the personnel managers atOptima would attend.According to one of the personnel managers, a challenge forHRM is to perform at a high level of competency in order to avoidintervention from the parent companies. Only if personnel needsare adequately met in order to fulfil the business plan for Optimawill the joint venture be allowed to operate autonomously. Thismanager sees a second important challenge to the HR department asthe avoidance of union intervention. This individual remarks bothparent companies are unionized, and that occasionally the unionindicate interest in the unionization of Optima as well.Managers have various perspectives relative to the functioningof the personnel department. One manager perceives the personneldepartment to be in a helper role in the organization, and notoperating proactively. He mentions the personnel group isgenerally viewed as involved in the operation of the company, but\"when it comes to business strategy, and even the people issues,that is all driven by the business people\". This individual notesthat until the need arises, personnel at Optima will remain a stafffunction. \"There's a lot of pressure frankly right now that theyought to be more active, at least in some of the areas where humanresource management is affected, and I think some of that isstarting to happen but it will be the need that drives it.\"To some extent, the future development of a proactive role forHRM at Optima will depend on the ability of members of thepersonnel department to convince managers their unit has a176significant role to play in the company. This also depends onreceptivity by managers to allow personnel to become moreproactive. When one manager was asked the role personnel mighthave in developing the culture of Optima, he replied, \"I'd say theydon't have a role\". He continued that was the president's functionand \"to me HR is a staff job and they serve people on the line, andwhatever the line people think they need, HR should provide\". Thissame individual felt perhaps if personnel had more resources interms of people, that they may have more time to handle newinitiatives \"rather than just keep us afloat\".2. Employee Involvement Systemsa) A Team ConceptThe implementation of employee involvement systems is mostrapidly occurring in Optima's plants. The team concept wasinitiated primarily by the production manager and the plant managerin Plant 1. In approximately 1988 the production manager at theplant first became interested in a team-based approach tomanufacturing. She convinced the plant manager to try the concepton an experimental basis. In 1989 equipment was reorganized andemployees were identified to work on a pilot team. In 1990 asecond pilot team was added which was designated to operate on apermanent basis. Extensive training in employee involvementconcepts and philosophy was begun. The results have been good,both in terms of employee enthusiasm and product quality. Thetraining coordinator in the plant remarks, \"it was an experiment,just to see if it [a team approach] would work with this type ofenvironment. And it worked exceptionally well.\" By 1991 the177management at Plant 1 had decided to reorganize the plant tosupport the design team proposal. Currently, the entire staff ofabout 600 is converting to an employee involvement system.The team-based focus has been actively embraced by themanagement staff at Plant 2 as well, although the plant managerintends to first stabalize the profitability of the plant beforemaking significant alterations to the current operating style. Themanagement at Plant 2 intends to more actively begin the transitionto team-based manufacturing in 1992. Plant 2 has approximately 350employees. To date the team approach is operating in theconnectorization department where employees are situated in \"workcells\". In this instance employees work as a team to complete anentire task. This is in contrast to a \"sequential process flow\"where each worker is responsible for only one part of a largerprocess.The philosophy driving the team or mini-factory approach isthat employees work in autonomous units which are flexible andeasily adaptable to product changes. The quality process remainsfirmly linked to the team approach. As the training coordinator atPlant 1 describes, the evolution of the team process has resultedfrom a desire to empower employees while at the same time enhancingproduct quality and company profitability. In his view,We're trying to give opportunity for our employees toempower themselves, to do more, to be better employees,to take more responsibility, to internalize the qualityprocess. By cross-training...it gives these employeesthe opportunity to learn more, to develop their skillsmore, and they really take more ownership for the wholeprocess they're working on.Responsibility is allocated to employees, who are called\"associates\" in order that they can make decisions regarding their178work area. This not only includes responsibility for productcompletion, but for other functions which are relevant to the workteam and which have traditionally been performed by management. InPlant 1, associates presently do their own work scheduling,preliminary quality checks, training and peer reviews. Newrecognition programs have been developed by a team of associates.Within the next few years, associate responsibilities will expandto include hiring and firing within their work group.Activities among the various teams are coordinated by a teamproject manager for production who arranges weekly meetings forassociate coordinators on each shift. There are various associatecoordinator roles: quality, site coordinator for housekeepingissues, training, (i.e. scheduling and skill determination),production, and personnel, (related to attendance, safety andmorale). Within each team, the associate coordinators have theresponsibility for these individual areas. The project managerfacilitates the meetings of coordinators from the various teams asa way of integrating and coordinating efforts across teams. Forexample, a coordination meeting would include the qualitycoordinators from all teams. This meeting offers an opportunityfor coordinators to exchange ideas and information related toactivities in their teams across various shifts.In addition to the establishment of a coordinated system,teams are responsible for their own problem-solving. ContinuousImprovement Teams (CITs) are in charge of improving some majorfunction like the cables or connectors, or safety, for each shift.The CIT has its goals chartered by the Quality Improvement Teamwhich is comprised of the management staff at the plant. The CIT179is cross-functional and has team associates working together withengineering or planning people, for example, to determine andprioritize problem areas. At Plant 1 there are two main productionareas - buffering and coloring - and the CIT will have members fromboth of these production areas on a single team. On a coloringCIT, for example, some associates from the buffering area will beinvolved in solving problems for the coloring group in production.This would be reversed for a buffering CIT. In addition, theplants also have Corrective Action Teams (CATS) which form to workon specific problems, and once the problem is solved the CAT isdisbanded. In Plant 1 there are 14 CITS and 30-35 CATS operatingas of mid-year 1991. Employees are informed of CIT and CATprogress through the minutes of team meetings which are posted nearthe plant cafeteria. The minutes may include the team goal,modifications completed or ongoing to a production process,recommendations for future changes, and projects currently inprogress.The keys to the effective implementation of an employeeinvolvement system are closely related to the human resourcepractices operating in the plant. As the training coordinator inPlant 1 points out, training and education of employees is criticalin order to communicate the goals and benefits of the new system.The plant training department takes a wide-based approach toemployee education and teaches a variety of courses includingbusiness awareness, communication skill building, group dynamics,conflict management, and group development. Related to productionskills, training responsibility is gradually being handed toassociates who take \"train the trainer\" courses and then in turn180train other associates related to work procedures.^Jobclassification systems are under revision so there will be fewerjob categories, and therefore more flexibility related to jobrotation and cross-training. Selection procedures are beingmodified so new employees are hired only if they have the potentialto be good team members. In concert with these changes, thecompany is instituting new recognition systems, and eventually arevised pay system which aims to reward employees on a \"pay forskills\" basis. In many instances, future changes in the plant arebased on outcomes from the Continuous Improvement Teams who arecomprised of associate members. It is a CIT which is currentlyworking to create a revised recognition system for associates inthe plant.b) The Creation of New RolesApart from specific system changes, the management staff atthe plants recognize the importance of more generally changing theway in which managers, supervisors and associates conceptualize howwork is to be accomplished. A department head in one of the plantsremarks,I think the biggest challenge is getting the workforce onour side. Not opposing us. Changing how management isviewed. Instead of somebody [managers] walking aroundwith a big stick telling you what to do, as people whoare there enabling them [associates] to work better, worksmarter. And that's radical. That's not just radicalfor the plant, it's radical for management also.This individual thinks there is likely to be covert resistance frommanagement. A project manager in the plant adds resulting shiftsin power are more a problem for line supervisors than for managers.Supervisory power may be hoarded if associates are not givenapproval at the supervisor level in order to carry out a new idea.181As managers share power with workers, in turn associates arerequired to be willing to accept more responsibility. Onesupervisor remarks \"a lot of the operators are hesitant to take onresponsibility. They like someone else making the decisions.\" Headds to some extent associates want to see tangible examples ofmanagement's intent to change the operating systems. Much of thisrelates to establishing a better trust between management and theassociates. However, this process has begun. There are no timeclocks to punch at Optima's plants. As the personnel managerpoints out \"we trust them [the associates] to write down the timethey work on their time card and turn it in. So for some of thesefolks it establishes an immediate trust that they've never feltbefore.\" Managers feel open communication with employees isimportant. For example, associates were included in a budgetingmeeting with the marketing group in which sensitive budgetinformation was shared. In addition, there is a conscious efforton the part of management to solicit employee suggestions relatedto the change process, and then to implement these suggestions.The department head of connectorization comments he had asked someof his group to volunteer for a team to look at production capacityand that seven associates volunteered. He said some of them wouldhave never previously volunteered for the task, and he believesemployee attitudes were slowly beginning to change.For some employees, the trend toward a participativemanufacturing system can have positive benefits. An associate whois a member of one of the experimental work groups in Plant 1comments,182I think our goal number one is total quality. And toachieve total quality I think we first have to achievetotal quality people. Not necessarily the best, but Ithink that we should instill good morals, good all aroundpractices within this company...I think that's whatOptima's striving for...top quality, people who care,people who want to get ahead...I think Optima tries tomake people feel good about themselves.3. Communication Systemsa) JV-Parent CommunicationsCommunication operates on multiple levels at Optima. Thisincludes: communication between the joint venture and the parentcompanies, executive exchange related to the planning processes atOptima, and the communication of information from management toemployees at both the corporate office and at the plants.Considering the communication linkages between Optima and theparent firms, there are many. These are primarily technicalrelationships in order to share product information and areaccomplished through a variety of meetings. One Optima executivedescribes the communication exchange in the following way,You have your technical business meetings going onbetween us and them [the parents] all the time. Thelinkages run all throughout the company from the lowestlevel to the highest level. At the highest level thereare the meetings, fairly major meetings every 30 days.There are also interim meetings of the [JV] Board ofDirectors...We have board meetings every 90 days andthere's an interim meeting in between to make sureeverybody is up to date. With geography, with 4,000miles apart where the parents are located, two differentcultures, a couple of languages to throw around,communications do take a lot of travelling and a lot ofprecision you might say. So it goes on continually atall levels. If I sat down and wrote down all the littlecommittees and everything like that, it would probably bea standing list, a very long list. It usually falls backto, I guess, a strategic direction that satisfies boththe owners.Although there are formal mechanisms for communication between the183parents and Optima, several executives describe the informationnetworks tend to be informal. There is frequent telephone contact,particularly with Fiberop.One manager remarks much of the success of his interactionwith members of the parent companies relates to \"the nature and thepersonality of the individual people involved. Some of the peoplethat we interacted with, depending on exactly how they behaved, howthey treated us I think could have had a strong influence on whatwe did or didn't do. I felt that we were very fortunate we gotalong well with the people we were dealing with\". Another managermentions that it is the \"old boy network\" which underpins thecommunication system between Optima and the parent firms. He notesthe importance of establishing specific contacts in each of theparent firms which are developed over a number of years. One wayin which these contacts are established for new staff is for themto go on temporary assignment to the parent company. Likewise, itis important to have key people in positions in the joint venturein order that they are able to tie back to the parent firm. Forexample, the Vice-President and Director of Cable Technology atOptima is a Bauer employee who is able to facilitate the exchangeof information related to the technology of the European parent.One of the executives from Bauer also notes the important rolelanguage differences play in the communication process. He feelsit is important for staff of a joint venture to know the languagesof each partner. This is especially relevant in the start-up phaseof the JV, when significant amounts of interchange are requiredbetween the parents and the venture. Optima does offer Germanlanguage training courses, although most managers did not seem to184attend the courses. In this instance, most of the managers atBauer speak English, and this provides the medium for communicationamong the different cultural groups.Related to the personnel department, the three corporate HRmanagers from Optima attend meetings in the human resources areawhich Fiberop coordinates. Fiberop has a human resource councilwhich meets at least twice a year for two days and is comprised ofsenior human resource executives from each of Fiberop's jointventures, subsidiaries, and the parent company. The purpose of themeeting is to exchange information related to human resourceactivities in the organizations associated with Fiberop. There isalso an annual HR conference organized by Fiberop which isavailable to a wider range of human resources staff. Optimatypically sends ten or twelve of its staff to the conference.Apart from these formalized meetings, the HR managers at Optima arein frequent (usually weekly) contact with their counterparts atFiberop. Although there are not formal meetings between thepersonnel groups at Optima and Bauer, the Manager of EmployeeRelations mentions there are two or three people in the HR functionat Bauer with whom they share information and arrange transfers.b) Communication Within the VentureApart from communication between Optima and each of the parentcompanies, various mechanisms for information exchange exist withinthe joint venture. Communication among executives at Optima isfacilitated through weekly meetings during which the President andVice-Presidents of the company meet to discuss major issues anddirections for Optima. In addition, there are monthly meetingswhich include upper-level representatives from management. One185executive describes communication as \"very good at the middle andupper management level because we have business teams that meetevery month and discuss the business at a very high level anddiscuss outside forces and things that are going on that influencethe business...\" The outcomes of the monthly meetings are passedto the middle management level through both written communicationsand informal channels. The executive continues \"there probablyisn't as much communication as there should be all the way downthrough [the company].\" However, the relatively small size ofOptima serves to aid in the transmission of information. There isan emphasis on the charting of data on graphs to relate toemployees the company performance. Optima relies on a voice mailsystem, which seems to be a critical link in allowing all levels ofthe organization to communicate with each other.At the corporate office, the communication process is formallystructured through monthly and quarterly communication meetingswhich are organized through an internal communications supervisorin the personnel department. The content of the meetings includesthe financial performance of Optima over the previous month, newproducts to be brought on line, safety and other issues. Theprogress of the various company locations is reviewed. Guestspeakers discuss markets, ongoing projects, success stories orfailures. In the case of the communication meetings at thecorporate office, employees are encouraged to voluntarily attend.In addition to the communication meetings, the internalcommunications supervisor is responsible for organizing \"KoffeeKlatches\" which are informal gatherings of six or seven employeeswho meet with a senior manager to discuss pertinent issues related186to the company. There is no defined agenda for the meetings whichare intended to provide employees with an informal setting to askquestions about Optima.A television monitor near the staff cafeteria announcesupcoming events, employee birthdays, and visitors to the company.Bulletin boards and information handouts provide additionalmechanisms for communication. A company newsletter is publishedevery second month, and is distributed to employees at thecorporate office and at the plants. The newsletter has informationabout Optima's progress, company objectives, descriptions ofvarious departments and their staff, achievements by individualemployees, pictures related to special events, and a page on healthissues.In the plants there are regular meetings of the managementteam. According to one of the plant managers, selected informationfrom these meetings is disseminated to lower levels in the plant.As with the corporate office, there are employee communicationmeetings in which operational progress and financial results arepresented. Although actual figures are not shared with employees,graphs and charts are used to outline the company performance.Once a year the president of Optima meets with all employees onlocation to discuss the progress of the company, and other relevantissues.The plants have \"focus groups\" which occur about twice amonth, and like the Koffee Klatches at the corporate office, thesemeetings are comprised of small groups of employees randomly chosenfrom the plant, who sit with plant managers to informally discusstopics related to the plant. The groups are meant to be an187opportunity for employees to ask questions of management related toOptima. However, as one supervisor remarks, he was told by anassociate the meetings are regarded as superficial, and thatproduction staff hesitate to discuss \"real issues\". Apparentlyassociates do not want to be classified by management as \"anegative person\", and subsequently may refrain from introducingtopics of significant concern at the meetings.Both plants have daily production meetings. In Plant 1,supervisors have weekly pre-shift meetings during which employeesare requested to come to work 30 minutes early to review events ofthe previous shift and items which need to be addressed on thecurrent shift. Related to the amount of information shared inPlant 1, an associate in one of the experimental work teamsenthusiastically remarked the shift supervisors \"are wonderful tokeep us informed on administrative type things, manufacturingchanges. Any type of things like that. They're great, they'regreat about communication.\" The associate adds their group hasaccess to a voice mail system and there are two phones in the workarea which everyone may use. The voice mail system can beactivated from home or from work. The associate notes they areable to listen to the voice mail system daily and get messagescommunicated to the work groups from either supervisors or fromother associates. In this way, information from an associate onone shift can be readily passed to members of a next shift.Associates have the option of calling their own communicationmeetings in a work area, as necessary. There are qualitycommunication meetings which focus on issues related to theproduction of quality products. Following the conclusion of188meetings for Corrective Action Teams and Continuous ImprovementTeams, the progress of the meetings are posted on a bulletin board.Bulletin boards display job postings, the names of individuals whohave completed various courses, as well as other items of interestto employees.4. Reward and Recognitiona) RewardsAccording to one of the personnel managers at the corporateoffice, the objective of rewards at Optima is to attract, retainand motivate staff. In particular, the company is seeking new waysto enhance employee motivation in the company. This individualnotes salary policies for the managerial and supervisory staff atOptima are \"identical to Fiberop\". A salary plan is developed eachyear for salary increases. According to one of the executives, themerit increase program is \"very structured, very well thought out,very well controlled in the sense of consistency.\" He addedhowever, some reward inconsistencies are perceived by employees atthe corporate office. This is largely related to employees outsidethe sales area who make contributions to the company, but who donot qualify for various sales incentive programs. Sales staff areable to make considerable amounts of money on the program, whereasemployees in marketing for example, are not eligible for the samebenefits. To date, employees have not been involved in designingtheir own compensation packages.Recently, a unit cash award has been introduced at Optima toreward employees for high quality performance, successfulcompletion of projects, or technical innovations. Based on a189supervisor's judgement, an employee receives the cash award. Theaward is \"pseudo-secret\" mentions one supervisor, and the names ofthe recipients of the awards are not publicized. The award isgenerally given on an individual basis, although there was oneCorrective Action Team in Plant 2 which received the award. Thecash amount was divided amongst the team members. There is alsoanother cash award for outstanding contributors which is moresubstantial, (i.e. to a maximum of ten percent of an employee'sannual salary), and has rarely been used. This reward is given bythe supervisor to the employee in private. As with the unit cashawards, the reward is given to individuals rather than to groups.As one manager points out, this is incongruous in a company whereat their largest manufacturing plant people are working together inteams.Although Optima currently does not reward employees on a \"payfor skills\" basis, that is the intended direction for the company.At the plants, particularly Plant 1, a Quality Improvement Team isconsidering new forms of reward. The QIT will focus on creatingsystems which reward for skills and knowledge. At Plant 2, withinfive years the aim is to define skill blocks and to pay employeesaccording to the number of skills they possess. At present, hourlyemployees at Plant 2 are rewarded for \"time on the job with certainminimum performance levels\". Although some managers in the plantsuggest the pay system is viewed by employees as competitivecompared to other employers in the community, another managerremarks in his area the pay system is \"viewed dismally\". Hementions the source of the problem is employees who have receivedlump sum bonuses rather than pay increases, based on Optima's190\"perceived ability to compete\".b) RecognitionIn the area of nonmonetary recognition, a variety of programsexist at Optima's corporate offices. There is a peer recognitionprogram for employee of the quarter and employee of the year; TotalQuality Management preventor of the year; inventor of the year; anda president's sales club for employees who excel in salesperformance. Since 1987, a PRAISE program has operated under whichemployees can nominate their peers for either small or moresignificant contributions to the company. For each nomination,employees receive a voucher worth three dollars which is redeemablein the company cafeteria or store. Employees who are recognizedunder the PRAISE program have their names posted on the PeerRecognition board in the cafeteria. On their birthdays employeesreceive a balloon and a candy apple at the corporate office. Theplants have decided to create their own recognition programs.Some managers at the corporate office do not actively supportthe company recognition programs. One supervisor explains he doesnot have nominations for employee of the month or quarter in hisdepartment. He continues this form of recognition becomesmeaningless when there may be a list of 30 employees who qualify asoutstanding employees for a quarter. The supervisor adds, \"I thinkit's lost its significance. Motivationally, it turns out to be apopularity contest in my opinion.\" Another manager remarks peerrecognition programs like these will \"die a slow death\". Thisindividual explains,A lot of the employees are uncomfortable being'recognized' as the employee of the quarter because in alot of cases they don't really understand why. And in a191lot of cases and in some departments, the reality is thatthe same person or the same two or three people would getthe thing all the time, if the system was truly operatingproperly. And what that tends to do is demotivate thepeople who feel that yeah, it's there but I really don'thave a chance of getting it [the recognition]. I'm morea proponent of a system that rewards people for improvingover their prior performance as opposed to just pickingout the best person all the time and saying you'rewonderful because that really doesn't do anything forthose people you're trying to move up. That personprobably needs it [recognition] less than anybody. AndI think a lot of those programs do that, they alienate alot of people. And in a lot of cases, sometimes it'sgiven to somebody because we're supposed to give this outevery quarter, and we only got three nominations, and itmay be for something that really isn't all thatthrilling. And the person gets something and a bunch ofpeople just sit there and shake their heads. It doesn'tcarry any recognition with it. I personally don't thinkthose are really successful programs.Although some departments or individual supervisors do notparticipate in recognition programs, some of the staff at thecorporate office feel there is value in recognizing staff for minoraccomplishments aimed toward creating quality performance.In each of the plants, various forms of recognition exist, inmany instances instigated by the employees themselves. In Plant 1,a Corrective Action Team has been involved in the creation ofrecognition systems for the plant, and the result has been a peerrecognition program in which staff are nominated for employee ofthe month. As the personnel manager in the plant points out, thisprogram is different from the recognition system operating at thecorporate office. Previous winners of the award make futureselections of employee of the month, based on interviews withsupervisors and peers who are knowledgeable about the nominee'scontributions. Recognition is given to employees who do \"somethingabove the ordinary\", and there are ten criteria which areconsidered such as good attendance or punctuality. The personnel192manager adds it is not necessary the employee of the month make amajor contribution, but the candidate should demonstrate all roundexemplary behavior. The Corrective Action Team which is working onrecognition is expanding programs in this area to include therecognition of teams. A jacket with the plant logo or team emblemon it will be given to employees as recognition for teamperformance. In the past, some informal team recognition existedin the form of taking teams to dinner or lunch.Plant 1 also has an employee of the year award. The plant has\"safety bucks\" which are given to employees for accident free timeon the job. For every month an employee has no accidents, he orshe receives a five dollar certificate redeemable at the companystore. Recognition is provided by supervisors at their discretion.One associate describes their team had worked weekends for sixconsecutive weeks, and as recognition their group leader took theteam to lunch.The plant manager at Plant 2 describes \"we try to do quite alot with recognition and they're all home grown\". The aim is tohave \"little and often\" and to \"try to recognize successes when wecan\"; this may vary from free soft drinks on a given day for goodscrap results, or a free meal. As in Plant 1 there is an employeeof the month program which is managed by the employees. Theemployee of the month receives a cash award, a T-shirt, a plaque,and has preferred parking near the front door for a month. Anemployee who wins this recognition is automatically put on a listfor employee of the year and is eligible for more cash and otherprizes and preferred parking for a year. The training coordinatorat Plant 2 remarks these awards are \"fairly prestigious and I think193the employees perceive it as that.^Although I've heard thecomplaint that it's a popularity contest, but I've only heard thatfrom a couple of people.\"A \"Dinner for Two\" program at Plant 2 provides employees witha complimentary dinner for high levels of performance on thejob. At the completion of a CAT project, employees get a shirt,luncheon, and their picture and name in the company newsletter andin the plant newsletter. When employees complete a training classthey get a framed certificate. If additional training is completedstickers are provided which employees may add to the certificate.The plant if considering a \"Recognition Wall\" where employees mayhang their training certificates. One of the line workers in Plant2 remarks although he didn't think getting \"some littlecertificate\" was important, he liked some of the other forms ofrecognition. In his view, eighty percent of the staff like therecognition and the awards provided by the company.5. Staffing and Promotiona) The Selection of Managerial TalentThe senior management at Optima are primarily employees whohave previously worked at Fiberop. The only manager who comes fromBauer is the Vice-President and Director of Cable Technology. Itis likely this position will always be staffed by a member ofBauer, in order to retain access to the technology in the largecable group within the German parent company. At Optima, where theexecutive positions have been predominantly staffed from Fiberop,the concern by the other parent and by the JV management is thatthe quality of the staff sent from Fiberop to the venture are of a194high calibre and capable of running the business. One executive atOptima, who had previously been an employee at Fiberop, explainsthere had been some problems with the early staffing of the jointventure. Although transfers from Fiberop to Optima are now firstapproved by Bauer, there had been a period when Fiberop had sentemployees to the joint venture who were highly paid but notessential to the business. The executive continues,Frankly, some of the people who came down [to Optima]were highly paid. And when you've got high paid peoplethat really nobody understands their function or theirrole, they're really not needed by the business, at leastin the other parent's perception, right. It's half their[Bauer's] money, they're paying half their salary andit's almost that simple. But those were the growingpains. In all honesty, we went through that phase.Since those early days, Optima is still primarily staffed fromexecutives from Fiberop. Staffing, however, is now based on need,and is given parental consent. Alternately, a personnel managerremarks in some instances, Bauer has wanted to transfer employeesto Optima in order for them to gain experience working in theUnited States. This may occur even if there is no obvious jobavailable in the venture for the employee from Bauer. Thepersonnel manager states \"from an HR standpoint this can be alittle disconcerting in terms of finding a spot for that person. Ina sense sometimes they're imposed upon us.\"One of the senior executives remarks he feels the venture doesnot need any more senior staff transferred from the parentcompanies, but feels Optima should cultivate new managers to thecompany's specific business needs. He notes the cultures of theparent companies are \"just too far away from the culture we needhere.\" Consequently, Optima currently focuses on hiring new staff195from campuses or junior military officers, rather than workers withexperience in other companies. The aim is to \"grow talent frominside\" rather than to \"buy senior talent from the outside\".Hiring of management talent is usually done in a teaminterview. Everyone who is involved in recruitment has beentrained in behavioral interviewing, and there are specificinterview criteria which must be covered. The interview criteriaare varied, but qualities such as initiative and decision-makingability are important requirements for new management hires.Technical ability is considered and there is some emphasis onhaving German language skills, according to one of the personnelmanagers. There are some standardized selection tests which areused throughout Optima. An interview response form exists forscreening of non-management and administrative/technical staff.The form lists criteria which are considered in the screeningprocess such as communication skills, interpersonal skills,decision-making skills, flexibility, self-motivation and level ofresponsibility and maturity. At this stage in the selectionprocedure the emphasis is more on personal than technicalrequirements.b) Hiring in the PlantsAt Plant 1 a hiring committee evaluates temporary employeesfor permanent positions at the associate level. The hiringcommittee for production, for example, is comprised of about 20people who work on the line. There is a representative from eachdepartment and each shift. Members of the committee considerpotential candidates for hire. Selection is based on a \"mentorreview\" which is completed by the prospective employee's peers,196supervisor's ratings and attendance records. The personnel managerat the plant notes the system has been operating for approximatelythree years and is very successful. He explains initially lineworkers were sceptical that management was going to allow them todo the hiring. However, \"our supervisors think it's the rightthing to do, even though it took some of that quote power away fromthem\". The personnel manager thinks they have made better hiringdecisions now than using a supervisory hiring system. In thefuture the plant management intend to have members within a team doboth the hiring and firing of associates to their own groups.Plant 2 has the local employment office do pre-screening usingthe General Aptitude Test Battery. There is further screening in-house which considers personal qualities like honesty and theability to work safely and in a team. Finally there is an internalinterview given by a peer group of three associates. The selectionprocedure uses a list of interview questions and a standardizedscoring system. It is the peer group who make a recommendation tohire or not. In most cases the group's recommendation is accepted,the personnel manager remarks. He adds employees are veryconcerned about having \"the right people in the work environment\".c) Career PlanningOnce employees are located in Optima there is career pathinformation available to them, in varying degrees, regarding otherpositions within the company for which they might be suitable orqualified. One of the personnel managers at the corporate officebelieves it is the employees' responsibility to initiate their ownfuture career development. A career planning program is run twicea year. As part of the program, the Myer Briggs personality test197is administered to employees to help them identify theirpersonality characteristics and where their interests and skillslie relative to available jobs within the company. In addition,the personnel department has grouped jobs at Optima in order thatemployees can determine within a matrix which jobs might be mostsuitable. Job descriptions exist in a book which are groupedtogether by \"families\". Employees are informed they can makeappointments with the personnel managers to discuss careerdevelopment. One personnel manager observes, however, fewemployees take advantage of these services.To date, the career planning program has focused on hourly oradministrative and technical staff. Despite this emphasis, thepersonnel manager in one of the plants mentions employees moreinformally find out about other jobs which might be available. Headds for administrative and technical employees there is a fairlynatural progression from helper to operator, but there is not asystem in place to inform employees of other opportunities oncethey reach the top level of a particular job. Hourly positions arefilled based on seniority, although over time the intent is tostaff positions based more on qualifications.The personnel department has considered expanding the careerplanning program for managerial and supervisory staff. In theopinion of one manager at the corporate office, the company doesn'tsufficiently develop it's managerial talent. He states,We don't do a good job of career pathing or developingpeople. It's just by chance. When a job opens up thesupervisor scrambles to find out who's the most capableto fit in that job. But we don't really put anyforesight into well, so and so is eventually going toretire or get promoted, or whatever. And we don'tdevelop an organization underneath that person or groom198the right people.As the organization becomes flatter, the personnel manager notes to\"keep people excited and fresh there may be more opportunitiesmoving cross-functionally\". Presently in Optima, people are morelikely to be promoted who have broad experience rather thanspecialized skills.d) Job PostingsIn the case of supervisory and management staff, it isdifficult to know which positions are to become available withinOptima. Job postings generally exist for hourly, administrativeand technical positions, and some lower level supervisory jobs butnot for upper level positions. One manager in the personneldepartment advocates a system in which most jobs are posted. Heexpresses,The HR group would love to post exempt [i.e. managerialand supervisory] positions up to a fairly high middlemanager level, but have not been able to get buy off frommost of the organization in terms of doing that, eventhough most of them [managers] have operated with theprocess for administrative and technical people andmanufacturing folks for years and are very comfortablewith it...The posting process, and the desire to expandit into the exempt ranks and up to a relatively highlevel is a function of one, a self-identificationprocess. Too much emphasis in the past in this company,and I think in a lot of others, is placed on the person'sindividual supervisor, and/or manager assisting them withtheir career planning. And what I think we fail torecognize is that there are a lot of managers in thiscompany who have no cross-functional experience who wouldhave a very difficult time explaining to people whatother jobs are out there. And people who are supervisorsand who are new or relatively low in the organizationwill have a very difficult time explaining to employeeswhat jobs they should move through, if they want to getfrom point A to point B.The personnel manager adds a posting process gives all employeesthe opportunity to look at available jobs, and then to apply for a199job if properly qualified. He remarks in the past employees havecome to him and wondered why they had not been considered forvacant jobs at Optima, especially when the employee had not beeninformed of the jobs which were available.An executive at the corporate office comments at themanagerial level, staffing decisions are made through \"negotiation,usually in a bar room between two competing managers off site. Ican offer this person this. What can you offer him?\" He continuedhe felt employee reaction related to this system was mixed. \"Ithink to a great extent people would like to see all jobs posted sowe would have a bidding process for all jobs regardless of level.I think the practical aspect of that is I don't want that tohappen. It seems too inefficient.\"Subsequently, rather than posting jobs for upper levelmanagement positions, promotion selections are make through a\"people review\" process. Under this system the vice-president ofpersonnel, the personnel manager responsible for managerial staff,and the general manager for a unit meet annually with other keymanagers in a unit and \"literally review every exempt person intheir [the manager's] organization\". Information related to anindividual's strengths and limitations is summarized on one page ofthe \"Performance Development and Review\" form. The review focuseson what an employee aspires to do, and what he or she is capable ofdoing. Outcomes of the review are recorded in a set of minutes.The system has been operating for about eight years.e) Qualities of JV ManagersIn terms of the qualities important for managers who work injoint ventures, one manager at the corporate office responds200credibility is an important characteristic. He adds,Credibility has to encompass all the partners in thejoint venture and the employees in the organization.It's probably I think, the single most critical element.If you have a lot of credibility as an individual...youhave to then establish your credibility with the folks atBauer, in our case with the folks at Fiberop, and withthe people who work on the shop floor and with the peoplewho work above you. And if you're working within thejoint venture if you loose that credibility with any ofthose four, any single one of those four, it greatlyimpairs your ability to accomplish your tasks.More specifically related to the qualities required of a personnelmanager in a joint venture, one executive mentions the importanceof being able to resist pressure from the parents to conform topolicies which may not be appropriate for the JV. \"It's very easyto be swept away on the tide of corporate policies from outsidegiants.\" Another manager observes a personnel manager must be\"open minded, willing to communicate and being able tocommunicate...and maybe do things differently than you've done themin the past.\" It is important to \"take the initiative tounderstand the individual businesses that we're in. And you haveto be able to communicate that knowledge that you acquire, and askthe astute questions to the folks from Bauer and the folks fromFiberop and the operations people.\"6. Employee Transfers Between Optima and the Parent Companiesa) The Transfer FormatOptima primarily transfers personnel between the joint ventureand the parent companies, particularly transfers with Bauer, as ameans of exchanging information related to technology. Transfersof staff from Optima to Bauer tend to be fairly senior people whoare sent to the German parent company to manage programs, according201to an executive at Optima. In the engineering area, small groupsof staff from Optima have been sent to Bauer for up to two years tolearn various technologies. In addition, Optima employees havebeen sent to learn about equipment manufactured by Bauer before itis implemented at the plants. In the last year, two phases ofoperating people from Plant 1 were sent to Germany (11 people intotal) for a 90 day period to receive training on specializedequipment.A fairly continuous influx of R&D people from Bauer to Optimaoccurs in order to exchange information about technical processesand equipment. Typically, employees who are transferred to Optimaremain for a period of two or three years. In addition toproviding technical expertise to Optima, the transfer of employeesfrom Bauer to the venture provides German employees with experienceworking in the North American market. On a shorter term exchange,high level German technical staff come to Optima for meetings andprogram reviews in engineering or other areas. In the case oftechnical transfers with Fiberop, these have been minimal forantitrust reasons. Fiberop is the primary fiber supplier to theventure. As already noted, business knowledge was transferred toOptima in the early stages of the venture through executives wholeft Fiberop to become permanent employees of Optima. Currently,transfers from either parent to the venture require the consent ofthe second parent prior to the transfer.In the R&D area, an engineer in product development who wastransferred to Optima from Bauer six years ago, remarks he thinkslevels of communication and trust have improved between Bauer andOptima over that time period. This has been the result of202experience in working together as partners, shared businesssuccesses, and the cultivation of personal contacts. The engineercomments that as an employee of Bauer, he has more access to thatparent company and its subsidiaries than would an outside employee.He specifically mentions an example when he was able to getinformation from a Bauer subsidiary, which he thought would havebeen very unlikely for an employee from Fiberop to obtain. Ingeneral, this engineer is able to get information from eitherFiberop or Bauer. This is not the case for everyone. A member ofthe R&D project staff who is also a Bauer employee transferred toOptima for the last four years, mentions he would like to have moreinformation related to his job, but that he has \"to live with whatI get. And I don't get a whole lot of information from Fiberop.\"b) Relocation PoliciesOptima does not have written transfer policies related totransfers between the parents and Optima. Despite this, transferprocedures are well established. Each parent company treats thetransfer of employees to the venture as if the employee hadcontinued to work for the parent company for the entire time. Thisincludes conditions of length of service to the parent anduninterrupted benefits. Employees who permanently transfer toOptima from either Fiberop or Bauer are able to carry over theirseniority and benefits from the parent company to the JV location.In reverse, employees who transfer to either parent company areable to have credit for years of service and benefits accrued whileworking at Optima.Employees on temporary transfer to Optima from the parentcompanies remain on the parent company payroll and benefits, (i.e.203retirement or medical coverage), and reimbursement is paid to theparent company by Optima. If an employee from Optima were to go toa parent company on assignment, then the employee would remain onthe Optima payroll and benefits, which would be billed back to thereceiving parent company. In most instances, this means employeesfrom Bauer will be getting more salary and benefits than an Optimacounterpart in a similar job. In general this has not created anyanimosity among employees, who view the Bauer employee astemporary. In addition, the information about salaries or benefitsat Bauer is not readily known, so employees at Optima are unlikelyto be aware of the benefits and salary structures provided toemployees on transfer from the parent company.The personnel department is often involved in arrangingtransfers of employees, and assisting with the adjustment process.In some instances, however, employees have been transferred toOptima without the knowledge of the personnel department. One ofthe personnel managers remarks he thinks personnel should beinformed of intended transfers. The personnel group also assistBauer employees transferred into managerial positions at Optima tounderstand American systems and policies. Managers from Bauertransferred to Optima go through the orientation process, qualitytraining, and are briefed on other company practices such as hoursof work and overtime regulations.For transferred employees a variety of relocation benefitsexist. In the case of employees from Plant 1 who went to Germanyfor 90 days to gain experience on new equipment, they received asubstantial salary supplement from Optima to cover incidentalexpenses. Travel and accommodation expenses were paid, as well as204one round-trip ticket home for a visit, or alternately a ticket fora spouse or friend to visit in Germany.Employees transferred to Optima from Bauer are providedcertain incentives to join the joint venture on assignment. On theBauer retirement plan, every year spent in a foreign country countsas two years. Bauer guarantees transferred employees a positionwhen they return. The German parent company pays for movingexpenses plus additional expenses for relocation. This includescompensation for being away from one's spouse, funding for newelectrical appliances, new clothing which may be required for adifferent climate, furnishings, and a car. Bauer will also pay foran apartment in the U.S. for one and a half months until theemployee locates appropriate accommodation. Bauer provides a loanfor a house purchase. The Bauer U.S. personnel department (locatedin the U.S.) will assist the transferred employee with Visas, taxinformation, and will buy back a house from the employee if it isunable to be sold, or will assist with the resale. While onassignment, Bauer continues to pay employee benefits forunemployment insurance, health, accident and retirement.Given the large number of incentives provided by the parentcompany, one might expect employees are more loyal to the parentthan they are to the joint venture to which they now belong. Oneof the employees who had been on assignment to Optima from Bauerfor several years explained this was not really the case. Relatedto his commitment to Optima, he mentions his level of loyalty tothe venture is more a function of his personal professionalism,regardless of the fact he is a Bauer employee and well cared for bythe German parent company.205c) The Employee PerspectiveFor employees who transfer to Optima from Bauer for a lengthyperiod of time, they operate under many of the personnel systems ofthe joint venture. As described by transferred employees, there isgood access for them to training programs. One project specialistcomments he can go to as many courses as he feels necessary,located anywhere in the United States. Performance reviews aredone by the immediate supervisor at Optima. In general, Baueremployees did not like the operating principles behind the reviewsystem. One individual comments the performance review isdetermined by objectives which must be met, however the realizationof those objectives might be hampered by the ability to accomplishtasks in conjunction with others. Another employee on assignmentexplains he would like to \"see performance measured on the qualityof work you do, and not on...the timely basis of the finish of thatwork. You can turn out garbage on time, and you're good. You canturn out a great product late and you're bad.\"One employee transferred from Bauer observes he did not likethe reward system operating at Optima, and would like to see moremonetary incentives for good performance. Related to recognition,another employee on assignment from Bauer who is responsible forthe management of American workers, said he views qualityperformance as something an employee is expected to do. Thereforegood work should not merit special recognition. He adds he expectsemployees \"to do a quality job every day\". He does not activelyuse the various awards operating at Optima such as employee of themonth to recognize employees. He mentions Germans view expectedemployee performance somewhat differently than do Americans.206With respect to staffing, a transferred employee from Bauerfeels the system at Optima operates quite differently from what hewas used to in Germany. More specifically, he notes a tendency atOptima for staff to move to jobs in different departments fromwhich they were originally located. Subsequently, people havebroad experience, and less specialization. This employee said overa period of six years at Optima, he has worked under five differentsupervisors, all with different backgrounds. Alternately, hepoints out at Bauer a supervisor would have worked in the companyfor many years and have specialized expertise in a particular area.This individual feels these discrepancies are probably a functionof cultural preferences.On the part of American employees working at Optima, they havelikewise noted some differences in their German colleagues whichthey identify as stemming from cultural background. One managercomments on variations in communication style. He says,In a way, you hate to stereotype it seems, but you know,the German culture is a much more direct culture in termsof dealing with people. And in this country, andespecially it may be even more so in this part of thecountry, direct confrontation and/or very directdiscussion or debate is not necessarily something thatpeople are comfortable with. And so I think a lot oftimes, some of the folks that come from Bauer may beperceived as arrogant and argumentative and very muchdominant personalities, when in fact, it's more afunction of how people communicate in their countryversus here.2077. Training and Developmenta) The Focus for TrainingThe Training Director reports to the Quality department atOptima, rather than to personnel. According to the TrainingDirector, the training division did report to personnel at onetime. There was no attached significance to a shift in line ofreport, and the Training Director remarks the decision to report toQuality could have gone \"either way\". There are multiple areas offocus for training at Optima, with specific attention directedtoward quality issues. As one executive describes, training issplit into four areas: 1. personal training and how to handlestress, 2. communications 3. technology and 4. quality management.All employees receive training in quality and there is a growingemphasis on technological training. The Training and DevelopmentManual lists numerous courses available to employees in the areasof personal development, supervisory skills, the \"OptimaEnvironment\" which deals with how the company operates in itstechnological environment , problem solving and decision-making,quality, interviewing skills, and various technical courses, amongothers. An orientation course is available to new employees.A course in German language is offered, and at least twomanagers who were interviewed are taking the course. If anemployee of Optima is relocated to Germany for a period of two orthree years, he or she is given language and other culturaltraining programs prior to the move. Cultural training is providedthrough an outside source and offers comprehensive informationabout the German culture, history and political situation. Thereis a program for the employee's spouse and children as well.208According to one of the personnel managers at the corporateoffice, training is done once there is an identified need. \"Wehave developed a core curriculum for certain jobs, on skills thatare needed\". Some of the training content at Optima has beenadapted from Fiberop. The personnel manager continued when Fiberophas a new training initiative, Optima is usually given theopportunity to modify their materials to suit Optima's needs.None of the training materials from Bauer or Bauer U.S. areutilized by Optima.Training is provided both internally and externally. The goalis to provide managerial and administrative/technical staff withforty hours of training per year. One executive describes thetraining division has some control of departmental training budgetsand adds this ensures the proper amount of training is done. Hesays this is \"a little bit of police control but it's also a way ofefficiently coordinating training for the company\". The executivefeels most employees have access to training programs when theyrequest them, usually subject to the supervisor's approval.Somewhat contrary to this, another manager said people in his groupmay go to a training session about once a year, and he doesn'tspend his entire annual training budget. He claims employees areinformed of available training courses, but don't ask for thetraining.b) Training in the PlantsEach of the plants have their own training resource people whowork in conjunction with the Training Director at the corporateoffice. Trainers in the plant take \"train the trainer\" programs.For instance, one of the training supervisors in the plant had209originally been a shift supervisor, who acquired skills as atrainer. There is ongoing communication between the TrainingDirector at the corporate office and the plant training staff. Inrecent years, the plants have increased the amount of trainingprovided to associates and introduced some cross-training and teammember training programs. This is in keeping with the companyphilosophy to have greater employee involvement, especially in theproduction areas.Plant 1 is actively involved in providing associates with teamtraining. The training is in modules and includes businessawareness, communication skills, group dynamics, conflictmanagement, group development, and personality typing determinedfrom the Myers-Briggs personality test. The \"total team buildingconcept\" also includes a discussion of managing change, and anexplanation of why the changes in the plant are occurring.Although cross-training had not yet begun in the plant as of thesummer 1991, it was expected to commence in the months whichfollowed. When an employee is cross-trained he or she will learnboth coloring and buffering sides of the business. The managementat Plant 1 have devised eleven steps an associate must learn inorder to be a \"full fledged tube associate\". Likewise, there areeleven steps leading to the attainment of comprehensive training inthe cable area. Tube and cable areas are the primary productioncategories for associates in the plant. Management is in theprocess of developing skills checklists for the training.A consultant works with the plant training supervisor in thedevelopment of new training programs. Some training is done by thecorporate office, some externally, and the majority of the training210is done at the plant. On-the-job training is done by peers whohave taken a \"train the trainer\" program. The teams decide whichmembers of their group will go to training, and in which order. Inthe past, training assignments had been the supervisor's role.According to one associate in Plant 1, they receive more thanadequate training and this employee adds \"it is continuous, itnever stops. We never stop learning\".Plant 2 is behind Plant 1 in the area of training. The plantmanager describes \"our training program here from a formalstandpoint is less than two years old. And prior to that if therewas any training, it was kind of a buddy system on-the-job. Youlearned it as you go. But now we have a formal training program.\"As in Plant 1, there is an orientation for new employees and safetytraining. Employees receive team training; and recently technicaltraining is provided on-the-job by associates who have taken the\"train the trainer\" courses. On Saturdays, four-hour trainingsessions are given to teams on handling conflict. Everyonereceives quality training and there was a \"quality refresher\"during which the plant was shut down for a day to attend thetraining. Employees also go outside the plant to attend trainingseminars.A cross-functional group of associates is beginning to developa new system for training in Plant 2. Under the system, on-the-jobtraining performance of an individual is evaluated by peers.Points are assigned for level of skill accomplishment. As anassociate earns points, he or she will progress through varioustraining stages, until the maximal number of skills is learned.Eventually the number of skills an associate possesses will211determine salary levels.Apart from the associates, supervisors in the plants receive25 modules of team training. The Training Director at thecorporate office describes the shift in company philosophy towardgreater employee involvement has created some difficulties for bothassociates and for supervisors. Associates need to take moreresponsibility. Correspondingly, supervisors need to relinquishsome of the power they have traditionally retained. Referring tothe dilemma of supervisors, the Training Director remarks \"they[supervisors] are the ones that really get hit in the crunch...itcan be very devastating. [We need] to let them know that they'regoing to win by being leaders instead of bosses.\" Part of the teamtraining for supervisors addresses power shifts in the workplace.8. Performance Appraisala) Performance Appraisal for Salaried EmployeesA personnel manager at the corporate office describesperformance appraisal is given in order to have a record of anindividual's performance over the year and as a reference forfuture job fits. There is a developmental component whichconsiders which additional skills an employee may require in orderto move into another job. The personnel manager adds although thisis his perspective, others in the organization view the reviewprocess differently. One of the executives remarks the purpose ofappraisals is to \"try and find the stars\" and to createopportunities for them in the long-term plan of the company.Alternately, appraisals are a way to separate out the \"dead wood\"and the executive adds there is an emphasis at Optima on212repositioning or downgrading employees when necessary. For somemanagers, the most important reason for performance reviews is todetermine if established objectives have been met, and subsequentlythe magnitude of salary increases. Although Optima has tried toseparate compensation from performance, the linkage remains.Performance appraisal is done once a year by the immediatesupervisor, and according to the personnel manager, supervisorsactually complete the reviews. Managers are given training in howto complete appraisals. The personnel manager mentions performanceappraisal is done much more than four or five years previously.The personnel department ensures this, and \"no merit increase willbe processed unless there was a performance review submitted\".Late submissions of reviews are tracked by the personnel group.The president of Optima endorses the importance of the performanceappraisal process and consequently the personnel manager notes\"it's a rarity when someone gets their performance appraisal late\".Appraisals for exempt employees (i.e. managers, supervisorsand administrative/technical staff), are based on a \"Management-by-Objective\" system in which an employee and manager jointly setgoals for the employee to accomplish in the next year. Performancefor the year is matched to the previously set goals. Majoraccomplishments, strengths, developmental needs, trainingobjectives and career interests or plans of the employee areideally considered. The final page of the performance appraisalform is a summary form which is completed by the supervisor andused in the \"people review process\". The same system for review ofexempt employees is used at both the corporate office and in theplants.213To accompany the performance review a \"Managerial/IndividualBehavior Inventory\" exists which lists various work-relatedbehaviors. This form serves as a behavioral checklist for thesupervisor and the employee during the performance review process,and can also be used as a guide to setting future performancegoals. The form is completed separately by both the manager andemployee, and then ratings on various items are jointly comparedduring the performance review. Items for consideration includecommitment to quality (i.e. meeting customer requirements, productimprovement, and problem-solving); commitment to people (i.e.communication skills, the ability to take initiative); andcommitment to leadership (i.e. goal setting, creating a teamatmosphere, and managing for results). Also, a guide is availableto employees which explains how to prepare for the review andsuggests questions they might want to ask of the manager. It isrecommended the review take two and a half hours.In addition to the formal annual performance appraisal, onemanager mentions every six months he has his supervisors do a\"forced ranking\" of how employees in his department are performing.The objective of this is to determine which employees are fallingbehind and to provide remedial help when necessary. This alsoserves as a vehicle for the identification of employees who are nolonger desirable to the company, according to the departmentalmanager.214b) Performance Appraisal for AssociatesHourly employees in both Plant 1 and Plant 2 also receive aperformance evaluation. There is a performance review form whichconsiders both work performance and personal traits. A portion ofthe form allows an employee and supervisor to list objectives whichneed to be accomplished, if the employee is to advance at the nextreview. Currently in the plants a new employee begins at a basesalary rate. Employees are reviewed every two months for the firstyear related to a pay increase. After this there is typically asix month and then a one year review. According to managers inboth plants, the progression is automatic as long as the employeedemonstrates adequate performance.The personnel manager in Plant 1 notes employee performance istied to the pay scale, but \"there are no measures, it's totallysubjective\". Some supervisors have developed their own performancemeasures for employees, although there is not consistency from onesupervisor to another. Reviews are done by supervisors, and aswith the exempt staff, the personnel department does not processsalary adjustments until the employee performance review isreceived. For the plants, the aim to move toward a peer reviewprocess for teams in the future. In one of the experimental teamsoperating in Plant 1 there has already been some application ofpeer reviews. One associate describes performance review in theirgroup is done by all the other team members, while the team leadersits in on the review. Referring to the team leader role, theassociate continues, \"they [the team leaders] usually don't haveany input, they just kind of sit back and listen to what we have tosay. If something really gets out of hand that they may agree or215disagree with, they'll put their two cents worth in\". Otherwise,the review is left to the team members. The associate considersthis to be a fair process, and adds the team members are in thebest position to observe how an employee performs.D. Results of the Employee QuestionnairesForty five people responded on the inventories.^Thedemographics of the group include 12 females, 31 males and 2unknown. The average age of the respondents was 36.3 years, witha standard deviation of 9.15 years. Of the employees whoresponded, 1 had not completed high school, 19 had a high schooleducation, and 21 had a BA or BS degree or some college. Employeeshad worked at Optima an average of 7.15 years, with a standarddeviation of 6.54 years. Twelve respondents had not been absentfrom work in the previous year.1. Minnesota Satisfaction QuestionnaireMean scores and standard deviations for each item of theMinnesota Satisfaction Questionnaire (MSQ) are aggregated acrossall respondents and appear in Table 7. Overall job satisfactionand scores for intrinsic and extrinsic job satisfaction arelikewise represented as aggregated mean scores. Employees atOptima demonstrate a high level of job satisfaction. Thepercentile score for overall satisfaction is 76.53 and is above the75th percentile identified in the MSQ manual as the relative cut-off point for high levels of job satisfaction. Standard deviationof responses for the overall score is 11.57 which indicates216considerable variation of employee responses around the mean.Percentile scores are high (81.7) for intrinsic satisfaction andmoderate (65.9) for extrinsic satisfaction. Referring to Table 7these scores are represented as aggregated mean scores out of amaximum score of 5 for a single test item. Respondents indicatethey gain intrinsic satisfaction from the chance to work alone(4.42) and to do things differently (4.24). Respondents feel thereis freedom to use one's own judgement (4.04) and the opportunity tomake use of personal abilities (3.89). Likewise, respondentsindicate there is a chance to do things for others on the job(4.20), and to tell people what to do (3.56). Optima is consideredas a source of steady employment (4.53). Working conditions areindicated as good (4.07) and employees gain a feeling ofaccomplishment from the job (4.07). Scores for extrinsicsatisfaction are generally lower. Respondents do not favor the waycompany policies are put in place (2.80), chances for advancement(2.98), or the pay policies related to the amount of work whichthey do ( 3.29). Of interest, scores are relatively highconcerning how supervisors handle employees. Respondents score3.57 for the manner in which their boss handles people, and 3.82related to the competence of his or her supervisor's decisions.2. The Culture InventoryResults of the Culture Questionnaire are displayed in Table 8.In a similar format to the MSQ, scores appear as aggregated meanscores for each item of the questionnaire. Mean scores are alsolisted for each of the four organizational culture categoriesrepresented in the inventory: group, developmental, hierarchical217and rational cultures. As well, an overall score for thequestionnaire is listed. Employees at Optima score highest on therational culture category (10.64). This indicates employeesperceive the organizational environment to focus on production,achievement and task accomplishment. There is some evidence of adevelopmental culture (10.08), suggesting to a degree Optimaencourages innovation and creativity within the company. The scorefor the hierarchical category (9.24) suggests there is someattention at Optima to order, rules and documentation. The scorefor group culture (8.48) while the lowest score, still indicatesemployees feel a degree of loyalty and tradition in the company,and there is some attention paid to human resource practices.3. Guide to Human Resource Management PracticesThe Guide to Human Resource Management Practices was completedby the Manager of Employee Relations at the corporate office, aswell as by the personnel managers in Plant 1 and Plant 2. Ingeneral, there is consistency between the three managers, althoughsome differences are indicated in certain areas. In many instancesdualities in HR philosophy or practices is indicated. For example,in the plants as well as at corporate office elements of both agroup and an individual philosophy operate simultaneously.HR planning is indicated as fairly informal and flexible.Although there are elements of both a long-term and short-termplanning philosophy, the emphasis is more on short-terminitiatives. As already noted, planning is focused on both anindividual and group philosophy, with Plant 1 tending more towarda group orientation. Planning is integrated with the plans of218other departments and tends to involve low risk-taking. However,the management staff at Plant 1 is taking more planning risks asthe plant incorporates a philosophy of high employee participation.Although the plant managers view HR planning as having a fairlyhigh level of employee involvement, this was not indicated as thecase at the corporate office.In the staffing area, hiring tends to be based on a policy ofinternal recruitment. Orientation sessions are provided to newemployees. There are few career paths available at Plant 2 or atthe corporate office, although in the latter case promotions tolateral positions are becoming more prevalent. Plant 1 has severalcareer paths open. Career path information is generallyunavailable and hiring and promotion criteria are ambiguous andunstated. Discrimination based on gender or social class is low.There is fairly extensive use of overtime.Performance appraisal is based on results criteria, especiallyfor managerial, supervisory and administrative/technical staff whoare evaluated using an MBO system. Reviews of hourly employeesemphasizes behavioral criteria. The tendency at Optima is toevaluate the total person, rather than to consider onlyperformance. Employee performance goals are short-term. Theperformance evaluation relies mostly on individual criteria,although there is a tendency to move toward group criteria in theplants. Employee participation in the review is high, and in most219Table 7Results from the Minnesota Job SatisfactionQuestionnaire at OptimaAs Aggregated Scores Across All RespondentsItem Mean SD1. Able to keep busy 4.38 .652. Chance to work alone 4.42 .623. Chance to do different things 4.24 .774. Chance to be somebody in thecommunity3.73 .695. Way my boss handles people 3.57 1.236. Competence of supervisor'sdecisions3.82 1.117. Able to do things that don'tgo against my conscience4.29 .668. Job provides steady employment 4.53 .629. Chance to do things for others 4.20 .6610. Chance to tell people what to do 3.56 .9711. Job makes use of my ability 3.89 1.0512. Way company policy is put intopractice2.80 1.3213. Pay related to the amount of work 3.29 1.2714. Chance for advancement 2.98 1.3415. Freedom to use my judgement 4.04 .9316. Able to try my own methods 3.69 1.1217. The working conditions 4.07 .8118. The way coworkers get along 3.71 1.0619. Praise for doing a good job 3.31 1.0220. Feeling of accomplishment from thejob4.07 .89Aggregated Category ScoresMean SD PercentileIntrinsic Job Satisfaction(items 1-4,^7-11,^15,^16,^20)49.02 6.20 81.70Extrinsic Job Satisfaction(items 5,^6,^12,^13,^14,^19)19.77 5.26 65.90Total Job Satisfaction 76.53 11.57 76.53(items 1-20)220Table 8Results from the Culture Inventoryat OptimaAs Aggregated Scores Across All RespondentsMean SD2.93 1.162.44 1.083.00 1.283.60 1.142.82 1.193.80 1.182.86 1.313.31 1.222.73 1.393.84 1.043.38 1.153.73 1.01Item1. A personal place2. Dynamic and entrepreneurial3. Formal and structured4. Production-oriented5. Loyalty and tradition6. Commitment to innovationand development7. Formal rules and policies8. Tasks and goal accomplishment9. Emphasis on human resources10. Growth through new ideas11. Permanence and stability12. Outcomes and achievementAggregated Means for the Culture CategoriesGroup Culture 8.48Developmental Culture 10.08Hierarchical Culture 9.24Rational Culture 10.64Total Score 38.44221instances implicit feedback is provided to employees. Promotiontends to be slow at higher levels in Optima, but there is apossibility to advance at lower levels of the organization.Salaries are relatively high and relative to the industry arepegged at the 75th percentile for administrative/technical andhourly staff, and at the 60th percentile for supervisory andmanagerial groups. Employment packages are standard and fixed.Employment security is high and there have been no layoffs in fiveyears. Many financial and social perks exist at both the corporateand plant levels. At the corporate office benefits include use ofa company jet, theater or sporting event tickets, use of fitnesscenters, picnics, parties and golf tournaments. Rewards tend to behierarchical and individually based. There is some focus oncollectively shared rewards in the plants. Although some rewardsare secret, there is greater openness developing around sharinginformation about rewards.Training is generally short-term and specific in nature.Depending on the type of training, it may be provided to eithergroups or individuals. Training is given both internally andexternally, and may be either on-the-job or in the classroom.There is currently minimal job rotation, although the plants aim tomove in this direction in the future. Employee input to thetraining programs is generally high.222E. Summary of the Results1. Formed in 1977, Optima is currently the largest independentmanufacturer of fiber optic cable in the world. The companystrives to be a quality supplier to the telecommunicationsindustry.2. The parent companies contribute complementary expertise toOptima. Bauer specializes in cable technology and providestechnical support to the JV. Fiberop is an internationalleader in the development of optical fibers, and is theprimary supplier of optical fiber to Optima. In addition,Fiberop has management control of the venture.3. Optima has undergone various stages in its development. In1980, the venture acquired a conservative copper cablemanufacturing company. Subsequently, a reorganization ofOptima occurred in 1985 and a \"Total Quality\" system wasimplemented. In this process, the management group at Optimawas challenged to combine differing cultures of the originalJV, the copper business and both of the parent firms.4. Total quality at Optima is accomplished through education,communication and employee involvement. As part of thequality system, the plants are moving toward team-basedmanufacturing. Team associates will eventually perform taskstypically designated to management such as work scheduling,preliminary quality checks, training and peer reviews.5. The HR function is linked to business planning through theVice-President for Personnel, who is on the executive planningcommittee for the company. Personnel managers at the223corporate office and in the plants are actively involved inthe creation and/or implementation of HR policy.6. Communication linkages operate at multiple levels in Optima.Technical information is shared between the JV and the parentfirms. Within Optima various formal and informal mechanismsexist for the exchange of information.7. The management of Optima is expanding employee rewardprograms.^Although salaries remain the primary form ofreward, a new cash award based on performance has recentlybeen introduced. In the plants, the future trend will betoward rewarding employees on a \"pay for skills\" basis.8. Multiple forms of recognition exist.^In the plants,associates have been involved in the development ofrecognition programs for their groups.9. Staffing is primarily based on internal recruitment. Jobpostings exist for lower level positions. Upper-levelmanagement positions are staffed based on the recommendationsof senior managers.10. Employee transfers between Optima and the parent companies,particularly with Bauer, occur on a regular basis as a meansto exchange technological information. Numerous transferbenefits are available for employees.11. A wide variety of training courses exist for Optima employees,provided both within the company as well as externally.Recently, training in the plants has expanded and associateshave been introduced to cross-training and team membertraining programs. Some in-house training in the plants isprovided by the associates.22412. Performance reviews are completed for all staff at Optima. Atpresent, salary increases are tied to the review. One of theplants is using peer review in an associate work team on anexperimental basis.13. Overall, Optima employees demonstrate a high level of jobsatisfaction related to their employment in the company.Employees consider the working conditions good, and feel thereis an opportunity to operate in a fairly autonomous fashion onthe job. They are less satisfied with pay policies or thechance for advancement.14. Employees generally view Optima as oriented toward productionand task achievement, as well as being innovative andcreative. Employees perceive some emphasis on rules,documentation and HRM practices.225CHAPTER SEVENTRIAD MOTORS CORPORATION 4A. Joint Venture BackgroundI. History of the VentureTriad Motors Corporation was formed in 1985 as a joint ventureequally owned by Japan Motors Corporation (50%) of Japan, andSpartica Corporation (50%) of the United States. Both parentcompanies are expansive, multinational organizations. Spartica isone the \"Big Three\" automobile manufacturers in the U.S.; JapanMotors is part of a highly integrated and industrialized network ofcompanies located in both Japan and around the world. The decisionto create a joint venture in the auto manufacturing industry wasthe result of approximately 20 years of cooperative relationshipsbetween the two parent firms. Triad manufactures a line of sportycoupes and sedans which are marketed in Japan and in the U.S. Themanufacturing site includes a two million square foot building anda one and a half mile oval test track. The manufacturing andassembly facility has a stamping shop, a plastics mouldingoperation, a body shop, a paint shop and a trim and final assemblyarea. Triad is one of the most technically advanced auto assemblyplants in the world, with more than 470 robots in operation. Atfull production, Triad has the capacity to produce 240,000 vehiclesannually or 63 cars per hour. The joint venture has approximately4 As with \"Optima Corporation\", the joint venture managementprefer the joint venture name, parent company names and the namesof individual respondents remain anonymous. Subsequently, thejoint venture name and the parent company names are fictitious.The joint venture is located in the United States.2263,000 employees who are unionized members of the UAW.Although the joint venture was announced in 1985, it took twoyears to finish the construction of the plant. The plant site waschosen due to its close proximity to various transportationsystems, and because Japan Motors had been offered an attractivestate grant to build in the area. From the initial JV formation in1985, each parent firm had a planning task force in operation. Onetask force was located in Detroit, the other in Japan. Followingthe official ground breaking for the plant in 1986, Japan Motorssent a small task group to the U.S. to begin work with the Sparticatask team. The first cars rolled off the assembly line in 1988,two months ahead of the estimated schedule. Success has come earlyto Triad. In 1989, Triad was named one of the Top Ten OutstandingEngineering Achievements for 1988 by the National Society ofProfessional Engineers. Triad's models have ranked as one of the\"Ten Best Cars\" in 1989 and 1990 by Car and Driver magazine. Theyhave also been included on the \"All-Star List\" for Automobile magazine (1990) and as \"Import Car of the Year\" by Automundo magazine (1990). Triad's coupes were selected as part of AutoWeekmagazine's \"Magnificent Seven\" automobiles (1990).2. Parent RolesBoth parent firms contribute manufacturing expertise to theventure. More specifically, Japan Motors brings advancedtechnology and its manufacturing style to Triad, and is responsiblefor the design of the plant facility. Spartica contributes somedesign capability and testing. In addition, Spartica hasexperience with government contracting and labor relations in a227U.S. setting. In terms of benefits to the parent companies, JapanMotors is able to use Spartica's distribution networks to promoteexports to the U.S. In a period, when American automakers arebeginning to fall behind in market share to Japanese competitors,the JV provides Spartica with an open window through which to viewJapanese manufacturing styles and processes. The vehicle models tobe manufactured at the Triad plant are intended to be sportier thaneither of the parent firms has previously produced. Spartica hadoriginally planned to drop a sports car model which had been online before Triad began production, but ultimately decided to keeptheir sports version.In the early stage of the joint venture formation, both parentfirms agreed Japan Motors would take the lead in the management ofthe plant. According to an employee on the Spartica task team,their group had been told to \"assist Japan Motors, but not to runthe plant\". In line with this decision, many of the manufacturingprocesses at Triad mirror those typically associated with Japaneseproduction and management systems. For example, Triad has a \"just-in-time\" production system and operates using \"kaizen\" tofacilitate the continuous improvement of work processes. Employeesare cross-trained in various jobs and rotate to differentmanufacturing tasks. Senior management at the plant haveinstituted a no layoff policy for staff and have adhered to thisdecision. There are morning exercises for employees. Office areasprovide employees with an open work environment separated by lowpartitions. Only the Vice-Presidents of the company have closed-inoffice space. Uniforms are mandatory on the shop floor andoptional for office staff, although most office personnel wear the228uniforms, as do the executive officers at Triad.The joint venture has a Board of Directors which consists ofeight members, four from each parent company. The Chairman of theBoard; the Executive Vice-President of Finance; the Executive Vice-President and Senior Manufacturing Advisor; and the Vice-Presidentand General Manager for Procurement and Supply are employees ofSpartica. Alternately, the President and Chief Executive Officer;the Executive Vice-President of Manufacturing, Procurement andSupply and Quality Control; the Executive Vice-President, HumanResources and Administration and Secretary; and the Vice-President,Assistant to the President are employees of Japan Motors. Allexecutive officers are actively involved in the management ofTriad. Also of interest, these and other key positions at Triadare counterbalanced between Japanese and American staff. Forinstance, if a general manager is from Japan Motors, then theassistant general manager will typically come from Spartica.Similarly, if the general manager is from Spartica, then theassistant general manager will be an employee of Japan Motors. Insome cases there may be two assistant general managers reporting toa general manager; one from each of the parent companies.Originally about 25 managers from Spartica and 50 managers fromJapan Motors had been sent to Triad. In 1991, about half theSpartica dispatchees remained in the plant, while most of the groupof 50 from Japan Motors are still active in the operations atTriad.The Board of Directors meets on a daily basis and according toone of the Japanese Vice-Presidents, operates on a \"unanimousconsensus basis\" in which there is \"agreement through discussion\".229The consensus management style was established early on in thesemeetings by the JV President. The Japanese VP continues,There is not a single case where we couldn't come toagreement. Very fortunate. Maybe because except oneperson out of the four Spartica guys...Spartica has beenassociated with Japan Motors for about 20 years. Sothere is some inclination to understand the Japanesebusiness, or the Japan Motors business in relation toSpartica. So it's not the combination of two strangeparties, and this might have helped consensus.If serious differences of opinion between the two parent firmsarise, they are not handled through a process of third partyarbitration, common in large North American corporations. Instead,issues are settled by the President of Triad who represents JapanMotors, and the Chairman of Board representing Spartica.In addition to the Board of Directors, there is an operatingcommittee which meets to help chart a course for the joint venture.The operating committee consists of the President plus fourExecutive Vice-Presidents, two from each of the parent companies.As the President of Triad is an employee of Japan Motors, in totalthe Japanese parent has three votes to Spartica's two votes. Oneof the Japanese Vice-Presidents describes the purpose of this splitvote is to avoid \"deadlocks\". Although formal mechanisms exist forjoint decision-making between members of the two parent companies,another Japanese executive notes implicitly the authority to makesubstantial decisions is not at the JV level. This power restswith executives at the headquarters office of Japan Motors locatedin Japan. However, at the operational level, many decisions aremade at Triad. A member of the Spartica task force mentions in theengineering area, they \"try to let the parents do their own thingand to keep them out of any day to day operations of Triad. Triad230is like a separate autonomous child from the two parents. And it'stough, but it's very important not to let any parent matters get tothe smaller [JV] company.\"3. Employee Sentiments About the VentureAlthough many of the upper level managers have beentemporarily transferred to Triad from the parent firms, themajority of the employees were hired directly into the venture.This has created a body of staff who clearly have their primaryallegiance to Triad, rather to either parent. The general managerfor Human Resources, who himself was hired directly to Triadremarks,The strength of this joint venture is obviously that it'stotally new, so you don't have any bad patterns that havebeen set that you have to follow; or any bad precedents.So you have an opportunity to create something entirely,totally new. You've got a new workforce, and a newfacility...you've got maybe a higher level of dedication.It's our company, so I think most of our people realizethat this is the only place that they have to work.Management is not going to say 'well, I'll be here fiveyears and then I'll be transferred to anothercompany'...Survival of this [JV] is very important to theTriad people.Related to loyalty to the JV, one senior Triad manager who is aSpartica employee, mentioned originally, his \"sole purpose\" was tolearn Japanese manufacturing methods, and to take new methods backto Spartica. His feelings have since altered. \"Now it seems likeyou want to try and be part of the team and make Triad successful.And I hear very little from Spartica anymore, being honest aboutit. We're so tied up in what we're doing here to make Triadsuccessful; and not Spartica or Japan Motors, but [to make] Triadsuccessful. So I think we pretty well feel like we're on the Triad231team.\"Another Spartica employee at Triad reinforces this theme. Hecomments \"there was always an unwritten mission statement that ourefforts would be to help Triad.\" It is necessary to put aside anyagenda to make the parent companies stronger at the expense of thejoint venture. Although this is not the case with all Triademployees, he thinks \"your own hidden agendas, you've got to putaside. You can't go into a joint venture saying \"I'm going to makeone of the parents stronger'...\" Those employees who did not sharethese sentiments of nurturing the JV have left Triad to return tothe parent firm.The relationship between Japan Motors and Spartica has notalways been idyllic. One Japanese manager remarks the two parentfirms sometimes have different targets, and what may be good forJapan Motors, is not always good for Spartica. For example, insome cases, the introduction of some of Triad's models into theAmerican market has been in competition with some of Spartica's ownmodels. Another Japanese executive observes successful jointventures require a great deal of patience, an ability tocommunicate despite language differences, and especially arequirement by JV managers to attempt to \"try and understand theother side\". He adds a joint venture \"is the natural outcome ofthe intentions of two companies...this is a kind of naturalmarriage...Of course, when it's a marriage there are good days andthere are bad days\".In the case of Triad Motors, the parent firms ultimatelydecided to get a divorce. This occurred immediately following thecompletion of this research. Spartica was experiencing financial232woes and consequently, to gain capital sold its interest in theventure to Japan Motors. The Japanese parent became the sole ownerof the company. One Japanese executive remarks he thinks it wouldbe easier to operate Triad as a wholly owned company. He would nolonger need to report to his \"stepfather\", to use his word. Thisexecutive explains if two companies have the same policy ideas,there is no problem, but this is never the case. \"Two differentcompanies, two different cultures...impossible.\"In July 1991, of the few employees who knew of the futureshift in company equity, most felt this would result in minorchanges at Triad. One manager notes \"most of us relate to being aJapan Motors company more than we do to [being] a joint venturecompany. The day to day visibility of Spartica is very low.\"Another manager explains \"almost everything that goes on here [atTriad] has a Japanese influence to it...Triad is a 50/50, was a50/50, still is a 50/50 venture. But I've always said only in asmuch as the economics are concerned. This has always been aJapanese run company, always will be.\" In light of the newownership, an executive considers the impact of this development onemployees in the plant generally. He surmises \"I also believe thatthe majority, not all, but that the majority of employees wouldactually welcome a greater Japan Motors presence.\"B. Strategic Orientation1. The MissionTriad aims to be innovative and is focused on the manufactureof high quality automobiles. The management group at the venturehope to achieve these goals through the effective involvement of233the workforce in processes which continually modify and improve thepresent products. The joint venture is not merely a technologicalamalgamation of the parent firms, but also represents thecombination of Eastern and Western cultures. A Triad brochureoutlines: \"Triad represents more than an automotive venture. Itis also the union of Eastern and Western cultures - a union thatproduced innovative methods of production and a motivated, quality-conscious work force.\"The mission statement for Triad reinforces these underlyingtenets. Specifically, as written in the company brochure, thephilosophy for Triad encourages management and employees:• To build high quality cars which will assure customersatisfaction.• To make continuous improvements in the operation ofthe company.• To work together to achieve company goals. (\"Wa\" orharmony among people.)• To adapt quickly to changing conditions.• To work in harmony with the community.• To enhance the success and reputation of Japan MotorsCorporation and Spartica Corporation.In addition to this overarching corporate philosophy or missionstatement, an annual company-wide mission or goal is set by theBoard of Directors. For 1991 the goal for Triad was to be \"totallycompetitive: cost, quality, productivity\". Department managerswithin the plant decide on a specific goal for their units, whichsupports the company-wide mission. As one example, manufacturinghad the reduction of defects as the work theme in the last cycle.234Further, employees pick a theme or topic to work on in their areaswhich is related to the departmental goal. In this case, employeesmight identify a particular defect to improve upon. Following thisformat, company goals begin broad and become more refined andspecific at the production level.2. The RequirementsThe management of Triad consider employees integral tobuilding quality into the manufacturing operation. One Japaneseinspection manager remarks, \"Triad's philosophy is that qualitymust be created in the process. Ongoing training within [the]Quality [division] and throughout the plant, in concert with thefeedback provided by our associates [i.e. production employees]creates a fine mesh, a fine sieve which blocks out defects duringassembly.\" The Quality Management concept is taken directly fromthe principles practiced in Japan Motors. In a handbook preparedby Japan Motors for employees of Triad, employees are advisedproducts should be \"perfect and there should be no defectiveproducts sold.\" Workers participate in Quality Circles in whichthe aim is to statistically monitor and control for substandardproducts or processes. Solutions are sought which addressidentified problem areas. Worker activities reflect the following:1. \"Quality is the first consideration.\"2. \"Quality is not made by inspection but is built into the carduring production.\"3. \"No defective part should be sent to the next process.\"4. \"100% high-quality products should be made the first time.\"Employees are encouraged constantly to improve the quality of the235work in each division. In a process of continuous improvementcalled \"kaizen\", modifications are made to work processes whicheither make the product better, or improve production methods inorder that employees can more easily perform jobs. In order tomaximize employee contributions, all workers are provided QualityCircle training as well as other production-oriented training.Approximately 350 Triad staff members have received training inproduction methods at the Japan Motors facilities in Japan. AtTriad, rather than specialization in one production area, employeesare trained to have broad technical skills. Subsequently employeesare rotated to a variety of jobs and are provided with cross-training.As outlined in the company mission statement, cooperation andworking together in harmony (\"wa\") are important. In this spirit,Triad management endorse personnel policies and labour relationsarrangements which attempt to positively link the worker and theorganization. Much of the policy orientation in this area has beenadapted from Japan Motors, as outlined in the handbook provided toTriad employees describing the Japanese parent company. The booksummarizes \"respect for human dignity\" and \"personnel developmentand making use of capable workers\" are policy goals. In this waythe company seeks \"to encourage each employee to develop his owncapabilities through his work and let him exhibit the full scope ofhis abilities; thereby helping him to achieve his self-fulfilment\".Following a format predominant in Japan, the company and the unionare \"non-antagonistic entities\". Further,Improvement of the union member's status and thecompany's achievement and development can becompatible...The labor-management relations of Japan236Motors are based on the belief of both the company andthe labor union [in Japan] that all problems can besolved, however difficult they may be, if the managementand the union fully and calmly discuss and understand theopinions of the other party with mutual trust andconfidence.The intent is to deal with labor issues through negotiation anddiscussion, rather than through strikes or lock-outs.The strategic orientation at Triad has been systematic andplanned, according to one Executive Vice-President in the venture.In the start-up phase of Triad, the President primarily emphasizedestablishing a foundation for quality. This meant attention todefect and scrap reduction, and an emphasis on Quality Circleprocesses. The next step was to build quality cars which metcustomer requirements and provided high customer satisfaction. TheExecutive Vice-President adds \"when we rank all the plants thatsell Spartica products, whether they are made in Japan, Canada, inMexico, or in the United States, all 25 plants, Triad comes out onthe top of the heap in terms of quality, in terms of customersatisfaction.\" According to this individual, the precedingcomparison also holds compared to products made in Japan. Once thefoundation for quality was formed, in 1990 the main goal was toachieve profitability. At this point, cost improvement measureswere instituted, with a major focus on \"lean production\". By theend of 1991, the Vice-president observes Triad started to make aprofit and has done so every month since, despite a laggingAmerican economy. In this case, the Japanese management strategyis to ensure high quality, high customer satisfaction and low cost.Volume and profits are intended to follow.237C. Meshing the Cultures1. The Cultural ChallengeWithin the organizational framework of Triad, Japanese andAmerican managers work together to create an efficientmanufacturing operation staffed by primarily American workers.Implicitly, as well as explicitly, this arrangement brings togetherthe national cultures of Japan and America. Different styles ofoperation, and philosophical variations prevail among the groupsrepresented at Triad. There is a conscious attempt by Triadmanagement to blend the cultures of the two nations into policiesand processes which are appropriate for a company which seeks tomanufacture automobiles in a way unfamiliar to most of the Americanauto industry. On a personal level, managers at the plant need tocommunicate to each other, despite language difficulties. Thenuances of what each group wants to accomplish, and why, are notalways easily comprehensible.A Japanese executive in the Human Resource Management areapoints out the importance of being able to merge the Japanese andAmerican cultures. He suggests this requires a great deal of trustand flexibility from all concerned. The management philosophiesprevalent at Japan Motors can not be introduced to the NorthAmerican plant without modification. However, creating suitablepolicy for Triad is a challenge. He continues it is \"verydifficult to find out what is adequate, what is not adequate.Still we are struggling.\" Another Japanese manager explains \"if wecan say that both cultures completely mixed is 100 percent, we arenow 45 or 50 percent of the way\" [at Triad]. He adds in every238meeting the managers at Triad face cultural issues. From anAmerican manager's perspective, he notes when ideas are presentedthe Americans and the Japanese see things very differently. Bothgroups often become frustrated by approaches embedded in diverseoperating styles. \"It's not necessarily that either person isopposed to the other's idea. The objective that they're trying toaccomplish is probably mutual. But the road that they want to takeis totally different.\"A Japanese executive points out differences between theAmerican or Japanese point of view go beyond a comparison of \" so-called Japanese management style\" versus American practices. On adeeper level the executive remarks,The base culture [of the U.S. and Japan] is completelydifferent, so we think it takes time to understand eachother...It's very easy to simplify the differentphilosophies between the Japanese and the Americancompanies such as no layoffs, or training within thecompany or promotion within the company, or so-calledlifetime employment. But it is very superficial.To elaborate, the Japanese executive observes many of thedifficulties they experience at Triad are related to differences inexpectations between American and Japanese employees. In the areaof promotion, for example, career advancement is much slower inJapan because of longer time-lines for employment with the company.He adds American workers don't understand this arrangement, and areimpatient for fast promotions. In another area, the Japaneseexecutive notes most of the Japanese managers are frustratedbecause they are not able to hire manufacturing engineers in theU.S. with broad-based skills. He adds in the U.S., employees aretoo specialized in their job experience and knowledge, as opposedto Japan where a wide range of skills is valued. Consequently, how239to train and hire is different in Japan.In the area of job rotation, a representative of Japan Motorscomments generally people expect job rotation in Japanesecompanies, but from a practical point of view job rotation isdesirable only when employees have extensive knowledge of aparticular job. In Japan, a worker who has been in a job for fiveyears is still considered \"green\". Therefore it may take fiveyears or longer until a worker is rotated to another position in aJapanese factory. Time perspectives are longer related to aworker's expectation of being with a single company for an extendedperiod of time. In contrast, employees at Triad may expect to berotated to different positions after relatively short time-frames,after attaining only partial job skill knowledge. Some of theJapanese managers find these expectations unrealistic.The meaning of work and the form of work relations differs insome important aspects between American and Japanese workers. OneJapanese manager points out that contrary to popular opinion,Japanese managers have \"business fights\" with each other and do notnecessarily strive to avoid conflicts. This is the case in therelationship he shares with his boss; although he adds this doesnot imply a lack of respect. Citing an example, the Japanesemanager remarks he will usually ask permission of his boss whetherhe can leave the office in the evening, or if he might still beneeded. He does this because he and his boss are \"sharing thebusiness\" together. He suggests there is a difference betweenJapanese and Americans related to mutual work relationships. ToJapanese employees they are \"sharing life\" with their coworkers.\"[The] job is a part of the life to Japanese...but to240Americans...it's kind of an assignment maybe, a contract with eachother...There is a difference.\"2. Bridging Cross-Cultural DifferencesBased on this small sampling of philosophical differencesdescribed by various managers and executives at Triad, sensitivityto another individual's operating style is imperative. One managerdescribed the biggest challenge for employees at Triad is to tryand understand the cultural differences, and how these differencesinfluence management styles and decisions. A manager sums thissentiment in the following way, \"both sides of the culture in termsof management [i.e. Japanese and American], there has to be muchmore awareness of the counterpart in terms of cultural sensitivity;the understanding and also the willingness to change on bothsides.\" Cross-cultural training can assist in the process. Inaddition, there need to be qualified staff who are able to operatein a \"bicultural setting\".In the General Affairs Department at Triad, (the Japaneseanalogue to Administrative Services in the U.S.), there are twomanagers who have bicultural skills. In different ways theseindividuals are able to operate in the role of cultural interpreteror liaison between the Japanese and Americans at Triad. Forexample, one female manager is completely fluent in both Japaneseand English, and has long-term experience living in both Japan andin the U.S. In the past she has been able to provide vital linksrelated to language and cultural explanations. In this capacity,she was involved in the union-management negotiations at Triad.This individual remarks Japanese managers are more likely to come241to her for advice than are the American managers.The other bicultural manager in the General Affairs Departmenthas served as a liaison for the Japanese who are on temporaryassignment at Triad. He describes himself as a \"buffer\" betweenAmericans and Japanese. Related to the transfer of technicalpeople from Japan Motors to Triad, this manager arranged foraccommodation, schools and other services. He is a link to thecommunity and gives presentations to local groups related to thenew Japanese presence in the area. In addition, this individualarranges for visits to Triad, a large task considering in a yearthere can be as many as 2,000 visitors to the plant.Clearly, it has been a difficult task for the management ofTriad to create an integrated corporate culture. Each parent firmbrings to the venture diverse philosophies and operating styles.These philosophies and styles tend to be influenced by the normsand values represented in the national society to which each ofthese parent firms belong. In the case of Japan and the UnitedStates, there are some operating similarities, but also manydifferences related to how work policies ought to be enacted. Forexample, in the Human Resources area, one American managerdiscusses the difficulty he has of creating HR policy whichexecutives of both parent companies accept. He says this processis frustrating \"because there are two different philosophies. TheAmericans are going to support their corporate culture that theyhave. And the Japanese want to support their corporate culture ortheir beliefs of how they think Triad should be run.\" He addsphilosophical divergence between the parent firms has made itdifficult for managers at Triad to determine a unique culture and242identity for the venture, a culture separate from each of theparent firms. This sentiment is also reflected by a Japanesemanager at Triad. He explains for the first five years there hasbeen a strong influence from Japan Motors, and now most employeesat Triad understand \"the Japanese way of business, Japanesethought, and the Japanese way of production. And in time, theyhave to realize and to decide to think their own way; the Triad waythey have to create.\"D. Human Resource Management at Triad1. The HR Departmental Rolea) Plant Start-UpPlanning for the human resources component began early atTriad. The General Manager for HR was hired in June 1986. Thiswas around the time when construction began on the plant, andtwenty-one months prior to production start-up. The HR GeneralManager was the first \"pure Triad employee\" to be hired into theoperation. He had worked neither for Spartica nor for Japan Motorspreviously. The Executive Vice-President for HR and the AssistantGeneral Manager for HR are both from Japan Motors, and also wereassigned to the venture in the very early stages. As with otherupper level administrative positions at Triad, these positions arecounterbalanced between Japanese and American managers. In thiscase, because the Executive Vice-President is from Japan Motors,the General Manager is a Triad manager with an Assistant GeneralManager from Japan Motors. In addition, there is a PersonnelAdministration Manager responsible for benefits, wage and salary243administration of salaried employees.^The Employee Relationsmanager works with the associates and is the management link withthe union. These managers were both hired directly to Triad.The task laid out for the newly formed HR department was huge.There was a requirement to hire 3,000 new employees, which meantprocessing about 200 to 250 people per month. Triad received over80,000 employment applications. Although the recruitment ofassociates was done through an assessment center operated by aconsulting firm in the area, the HR department was responsible forinput to the process. HR staff were actively involved in employeeorientation, as well as in the recruitment of salaried employeesand the development of benefit programs. Time was also spent inpreparation for dealing with the union, which management correctlyanticipated would try to unionize Triad. It was not until theseissues had been dealt with that HR managers were able to turn theirattention to policy formation. As one manager remarks, there wasnot a list of identified policy requirements, but rather HR policywas written as it was needed.b) The Development of \"Hybrid\" HR PolicyHR policy is created for Triad which consciously draws fromboth American and Japanese management practice. One seniorJapanese manager comments on the need to form a \"hybrid\" system ofHR policy and practice. Consideration is given to the fact themajority of the associates in the plant are American. An HRmanager notes,When you've got multinational involvement, whatevercountry you're going to have your plant in, where everyou're going to stock your plant, the customs,traditions, behavior patterns of that country have to beaccepted...There is a lot of similarity actually between244Japanese and American workers. There are probably moresimilarities than dissimilarities, but thedissimilarities are striking. And while you can shapeyour work environment, shape your corporate philosophyand your corporate culture a certain way, there are justlimits on what you can do. So part of HR is to know whatthe limits are and to make sure that the managementunderstands them.Related to this, part of the task for HR managers involves thecreation of policy appropriate for employees, while at the sametime taking the goals and the norms of both parent companies intoconsideration. The individual cited above adds at the uppermanagement level at Triad, all managers should be informed as towhat is accepted policy in the United States. This may includelegislation related to hiring and firing practices, or workman'scompensation, among other things.In order to create a blend of HR policy and practice, bothAmerican and Japanese managers in the HR area have worked togetherfrom the conception of Triad to try and understand each other's HRorientations. In the first years of the JV, both the HR GeneralManager and the HR Assistant General Manager would travel to Japanseveral times a year to allow the American manager to get betteracquainted with HRM policy at Japan Motors. Many of the managersat Triad are Japanese and provide their insights into appropriateHR practice on an ongoing basis. In addition, the HR AssistantGeneral Manager (who is Japanese) mentions to gain greaterknowledge of American personnel practices, he had at one timeworked with a colleague in the HR department at Spartica. Somepolicies were largely adapted from Spartica, such as the healthinsurance plan. One manager mentions creating linkages with theAmerican parent firm was beneficial in order to have access to245certain HR policy information. Initially the PersonnelAdministration Manager at Triad had been a Spartica employee. Whenhe left the company in 1989, the direct link from HR at Triad andHR at Spartica was severed.To get broad managerial input to new HR policies, staff in theHR department typically draft a policy and then distribute it toSpartica, Japan Motors and Triad managers who work on the site fortheir review prior to implementation. According to one manager,this is done in order that all groups totally understand thepolicy, as well as to get additional comments. The HR AssistantGeneral manager will often act in the role of cultural interpreter,in order to explain the rationale behind a particular policy toother Japanese managers. According to various HR managers a policymay be rewritten many times, making this a very time consumingprocess. In some instances, when major policy changes areinvolved, the Executive Vice-President for HR will take the policyto the Board of Directors for approval.c) Challenges for HRMSome difficulties were expressed by managers who are uncertainhow to proceed in the absence of established HR policy. A managermentions Triad did not have written policy in some areas for a longtime after operations began, and subsequently managers \"made uptheir own [policies]\". This created problems in the plant becausemanagers did not know how to consistently handle HR-relatedsituations such as insubordination, pay, or travel allotments. Oneproduction manager remarks ideally policies, procedures and rulesof conduct need to be set in advance of when they will be required.A manager in the HR area echos these sentiments,246I think if there were two things I could say that weremistakes made, in terms of this particular joint venture,one of them was, and they kind of go hand in hand, onewas not having a fully staffed human resources functionon board before you brought anybody else in; and inconjunction with that was having your policies andprocedures in place before you start hiring people.Because what was occurring in the absence of thosepolicies, was well, kind of what you felt like doing thatparticular day, or with that particular person. So I mayhave done something differently for you than what I didfor the person I hired next month. And those have beensome problems we're still living with to this date.However, as another manager explains, part of the reason HRpolicies could not easily be set up early in the life of the jointventure was because of the pending unionization of the plant. Thegeneral manager of manufacturing notes although certain policiesshould have been implemented earlier, with a new union there is \"agray area, and if you create those policies early on then you'relocking yourself into a situation where you don't have a lot offlexibility.\" In this case, when management waited to jointly workout some of the HR policies in conjunction with the union, therewas a lag phase of approximately two years from the plant start-upuntil the union became established at Triad.Managers in the HR department acknowledge they have numerousongoing challenges. One manager mentions the difficultyexperienced by the HR group to be proactive, in a venture wherethey feel they are understaffed. He clarifies,We'd like to take more of a leadership role, but we'vebeen hampered in doing that from the standpoint that wedon't have the number of people to do anything. Rightnow all we can do is react to things that happen. Wecan't be as proactive as what we should be. We can't bepreparing better training programs, we can't beinteracting better with the people because we have somany responsibilities and so few people to handle theresponsibilities, that all we can really do is just jumpfrom one project to the next. We don't have any time todo new projects.247This same manager remarks not having additional staff is a \"major,major problem for human resources\". Apparently the HR budget isone-half to two-thirds the size it would be for the same sizeoperation in Japan, and much less than Japanese transplantcompanies in the United States. Despite the shortage of staff, anassociate mentions services in the HR department are readilyavailable: \"You can come up there any time for anything.\"Other managers identify the major challenge for HR is to keepa \"balance\" between groups in the plant who operate with differentpriorities. In particular HR seeks to maintain equilibrium between1. union and management; and 2. between a human resourcesorientation and a manufacturing focus. This is not to say eachgroup's goals are mutually exclusive. However, one managerdescribes the importance for HR staff to understand the needs anddesires of all associates on the shop floor, and not just respondto the requests of the union committee. He states in his view itis criticalTo keep the balance between the environment the Japanesehave worked so hard to create on the floor with theassociate people, and the environment the UAW would liketo create for their own reasons. How to keep thebalance.. and walk that fine line. To be able to walkthat line, I think you need to know a great deal morethan what we're learning, because you're liable to falloff and not know you have.Related to the goals of HR and manufacturing, a managerremarks the primary goal of manufacturing is to produce cars. HRis concerned mostly with \"making sure people are treated as humanbeings\", and sometimes practices which HR managers advocate forassociates at Triad many interfere with maximal production output.There have been instances when managers in manufacturing would like248to keep associates on an overtime basis, and may inform employeesof this only a short time before they are due to leave work for theday. An HR manager mentions this is part of a difference inopinion between manufacturing who want to get more time in on theline, and HR who feel it is their mandate to protect staffinterests. He adds, \"so HR, in many ways, sits in the middle of acompany\". It has a central position because HR deals withproduction, the union, the parents, and diverse cultures and as aresult \"you're tap dancing on bonfires all the time...Of all themyriad of problems you couldn't even imagine happening - they havehappened.\"2. Communication Systemsa) Communication Across CulturesRepeatedly, managers emphasize communication is the mostpervasive problem at Triad. The communication process iscomplicated by the predominance of two languages spoken by managersin the plant. Each group needs to understand the other in order toeffectively contribute to the JV operation. In addition, managersoften find it easier to communicate within their familiar culturalgroup, in a common language, rather than to integrate discussion orpass information to colleagues outside one's own culture. Cross-cultural communication is not the only difficult area. There arealso problems in transmitting information to lower levels in theorganization, regardless of language considerations. Often themiscommunication or absence of dialogue occurs between employees atTriad who speak the same language. One manager adds, \"failure tocommunicate is by far one of the biggest problems we have here.249And it's not just Japanese to Americans, it's Japanese to Japanese.And also of course, American to American.\"One Japanese Vice-President remarks when differences inopinion occur between Japanese and American managers it is often\"based on the misunderstanding or lack of proper communications\".He mentions the lack of English language skills as a problem andoften \"both sides get frustrated...Basically I think we [theJapanese] are trying, trying to understand, or trying to explain.It's a long process in any joint venture.\" One manager remarks itis interesting Americans come into Triad with the full knowledgethe company has a different culture and there are languagedifferences, and yet they show little patience related tocommunication with Japanese colleagues. Although many of theJapanese managers on site at Triad speak English quite well, thereare essentially no Americans who are conversant in Japanese.In some areas, such as the exchange of technical information,language is less problematic. According to a Japanese executive,technical exchanges have been \"very successful\". The factengineers have a common language has facilitated this process. Inaddition, the physical exchange of American personnel to Japan toobserve first-hand various production procedures has made the needfor verbal communication less critical. At Triad, interpretersare used on the production floor to assist in the transmission ofinformation between Japanese technical assistants or coordinatorsand American managers or associates. A manager in the engineeringdepartment comments that illustrations are helpful, and in meetingsbetween both Japanese and Americans they tend to write down mostcontent on a white board. \"We did a lot of illustrating through250sketches and this was very helpful to overcome this languagebarrier.\" In written communication as well, one American managermentions the Japanese prefer to see graphs and charts for thepresentation of information.However, beyond the physical competence required to speak alanguage, the ability to effectively communicate between culturalgroups is embedded in an individual's desire to take the time andeffort to initiate information exchanges. An appreciation ofdifferent communication styles is imperative. One manager who isequally skilled in both American and Japanese language and culturedescribes,Flexibility is very important, and the tolerance ofambiguity. Now ambiguity is something that stems fromthe Japanese language and culture. And the Japanese willnever come out and say things very straight forwardly.The Japanese will go round and round the bush in tendifferent ways...but what he's telling you is I don'tlike that idea, it's not acceptable.In contrast, a Japanese manager remarks \"American people are verymuch outspoken and sometimes upset some Japanese because they areso straight or so outspoken.\"In addition to obvious variations in communication style, incertain instances some American managers report a lack ofwillingness by their Japanese colleagues to openly shareinformation. Considering information-sharing among the Japanese atTriad, there is a definite advantage to being a \"born and bredJapan Motors employee\". It is important to have come up throughthe ranks of Japan Motors to be considered an \"insider\" andtherefore privy to certain strategic information. One managerrecognized it may be trivial information which is withheld, but inthe day to day operation of the plant this information becomes251important. American managers are involved in the plant management,but at a certain point this involvement is curtailed. This sameindividual suggested a need for \"patient aggressiveness\",indicating a requirement for both patience and persistence incommunications.According to a number of the American managers at Triad, theirJapanese counterparts exchange information informally in settingsin which they are not likely to be present. Meetings are oftenheld among the Japanese managers in the evenings, with no Americanmanagers in attendance. This form of \"socialization\" can be a timeto exchange strategic or technical information relevant at Triad,or to consider future directions. One American perceives thisprocess as part of gaining \"consensus\" on issues before taking themto formalized meetings with both American and Japanese managers inattendance. By the time the meeting occurs, a decision for actionmay have already been made. The manager adds \"this drives theAmericans nuts because in many cases they haven't been involved inthis socialization that's gone on, and they feel like they've beenbypassed.\" Related to production, a manager in manufacturingobserves information usually will reach Japanese managers orassistants before it reaches him. He mentions,The communication for example in terms of tasks, whatneeds to be done for the '92 model...it seems to comedown through the Japan Motors side, and everyone on theJapan Motors side including our TAs [TechnicalAssistants] and coordinators...they seem to know what'sgoing on. At all levels it [information] filters throughthe Japanese ranks, then we have official meetings toexplain, to disseminate the information; to assign theresponsibilities, or whatever. And what's always thecase is that all the Japanese people are already dialedin.A branch manager likewise explains even though an issue on the252floor arises which is his responsibility, a Japanese manager mayconsult directly with a Japanese coordinator related to the issue,therefore bypassing the branch manager. In this way, communicationdoes not occur with the person who is theoretically in charge ofthe operation.In the Human Resources area, several of the American HRmanagers comment communication with Japanese managers is difficultrelated to technical or legal issues, because the informationcontent is foreign to the Japanese (i.e. severance packages). Butthe more pressing communication problem expressed by the Americanswas how they can be better involved in the decision-makingprocesses in the HR area. One HR manager provides an example ofhow he had been circumvented by a Japanese manager who wanted tohave one of his staff promoted. The Japanese manager went directlyto the Executive Vice-President of HR for an approval, rather thangoing through the regular channels operating in the HR department.The manager who is designated to handle promotions was not providedan opportunity for his input. He remarks, \"these promotions, weshould be involved in this before it comes to us and say 'this iswho we want to promote'. We should be involved in discussing whythis person should be promoted before that decision is made.\" Inareas other than promotion, there have been problems for Americanmanagers who wish to contribute their opinions. The Americanmanager observes that in an American setting he believes he is ableto supply information related to worker expectations and attitudes,if given the opportunity to do so.b) Networks for Information ExchangeAt Triad a variety of mechanisms are in place for the253communication of information to managers and associates. Thecompany newsletter is published monthly and includes for example,items on quality circles, department roles and activities, acalendar of community events of interest to employees, car modelchanges, awards given to vehicles produced at Triad,production/sales statistics, contributions the company makes to thecommunity, and a list of those people who received promotions atTriad. In addition to this newsletter, there is a monthlypublication specifically devoted to Quality Circle news. Inparticular, this publication focuses on participation in qualitycircles, with reference to projects which are either ongoing orcompleted. Details of ongoing QC projects are described. In 1991closed circuit television monitors were added in the companycafeteria which carry world news, special programs and informationpertinent to Triad. There are bulletin boards in various locationson the plant floor where information for associates can be posted.Meetings are held at multiple levels in the plant within thedifferent departments in order to advise employees of newdevelopments. Employees also convene their own meetings related toquality circle and kaizen processes. On occasion the President ofTriad is seen walking in the plant talking to associates.The initial intent at Triad was to create an open style ofcommunication, with maximal information passed to employees inorder that they can actively participate in the operation of thecompany. In the office area, an absence of walled offices allowsstaff to have easy access to one another, with no physical barriersto communication. Related to communication on the plant floor, amanager explains in orientation sessions for new associates,254emphasis was placed on high employee participation and opencommunication. However, this same manager adds in the day to dayoperation of the plant the level of communication which they hadoriginally hoped for has not materialized. Regardless, he feelsthe level of communication at Triad is superior to the average autoassembly plant.A manager mentions in his opinion, part of the communicationbreakdown occurs because some group leaders are not receivinginformation from upper level managers, in order that they can inturn pass it to associates. An associate agrees with thisassessment. He describes \"communication is a big factor. I'vetalked to several of my supervisors about it. It [information]just doesn't filter down. There's too much secrecyimposed...Usually when we want to know something we go tomanufacturing.\" He continues in some cases, even when the groupleader does obtain information, he will choose to withhold it fromthe group members. The associate volunteers it would be useful tohave memos sent to each group from management so information couldbe posted on a bulletin board for everyone to read. Some groupleaders do try and keep associate members updated. One groupleader clarifies every day at the beginning of a shift there is afive minute meeting during which he tells associates aboutproduction levels for the previous day, production expectations forthe shift, and other miscellaneous news. The group leader adds\"but we aren't told much\", although he does have daily meetingswith his branch manager and the manager for his department.Apparently it is especially difficult for employees to getinformation if they work on the second shift, when branch managers255are infrequently available (i.e. except once every six weeks forone week).At the upper management level, managers have mixed reaction asto how the communication systems operate. Some managers feelbecause of communication difficulties it is \"impossible to get thejob done at all\". Other managers mention they are satisfied withthe amount of information provided, and in turn share it with themanagers who report to them. One manager who works in themanufacturing area said he began monthly department meetings twoyears ago because communication in his group was not adequate. Atpresent there are 125-130 people who attend this meeting to receivea departmental update. In the HR area there are meetings whichinclude some of the managerial staff, usually twice per week. TheExecutive Vice-President for HR does not typically attend thesemeetings, although he did in the past. Managers in HR comment theyfeel it would be valuable to have the Vice-President in attendance,especially related to setting goals and objectives for the HRdepartment.In general, an HR manager thinks a \"top-down decision\" isrequired which commits Triad to greater information sharing, and tothe establishment of superior mechanisms for the distribution ofinformation. Further, he mentions it would be an advantage ifmanufacturing would better inform the HR group of content to bepassed to the floor, so HR could put this information into a formatfor distribution. According to this manager, time then needs to beset aside for meetings between group leaders and the associates.On the labour relations side, a member of the union bargainingcommittee comments if manufacturing would pass more information to256human resources, then HR would be better able to inform the unionof potential problems in the plant. At present this flow ofcommunication does not occur.3. Employee Involvementa) Quality Circles and KaizenEmployees at Triad are encouraged to be actively involved inthe identification of problems in their respective work areas, andto create solutions to these problems through the complementaryprocesses of Quality Circles and Kaizen. Quality Circle (QC)activity focuses on the specification of a problem for which thereis no identified solution. An investigation is required toidentify root causes to a problem, during which releventstatistical data is collected. Kaizen is part of the QC activity,and is a suggested improvement to a problem. Once an obvioussolution to a problem is apparent and the benefits are defined,then the Kaizen solution can be implemented which will result inimmediate improvements. In the spirit of continuous improvement,a series of Kaizen solutions can be incorporated into the QCsolution. Refer to Appendix 12 for an elaboration of QualityCircles and Kaizen and their relationship to each other.Through the complementary process of Quality Circles andKaizen, associates are able to suggest improvements to themanufacturing process, (i.e. the reduction of defects), orintroduce changes in their work environment which ultimately maketheir jobs easier, (i.e. the use of headsets for bettercommunication on the floor). The Branch Manager for QualityCircles mentions the Quality Circle emphasis is more on teamwork257than on cost savings. However, the benefits to Triad from QCactivities are not negligible. In one instance, a QC group in theplastics shop was able to cut 73 seconds off a procedure, resultingin a one million dollar saving per shift to the company. TheBranch Manager for Quality Circles works full-time with theassociates to provide Quality Circle training and advice.According to him, the QC training at Triad has been 100% adoptedfrom the Japanese method in terms of theory, but modified to suitthe American worker.b) Employee Sentiments about Involvement ProcessesA Spartica executive at Triad made an interesting observationthat the concepts of Quality Circles and Kaizen can operateeffectively only when there is an environment in which there ismutual trust between the associates and management. He mentionsneither QCs nor Kaizen could exist in a traditional auto assemblyplant. The executive elaborates in a Spartica factory if employeeswere to improve a manufacturing process, the result may be arequirement for fewer people on the line. If this were the case,the company would lay off some of its workers. At Triad,associates are told there will not be layoffs and the company is\"living up to it\". The Spartica executive continues, \"there's afeeling here that there's some security being built, and there'ssome trust. And with that goes along contribution and willingnessto compete; willingness to participate from our associates thatI've never seen anywhere else.\" He adds he had talked to variousvice-presidents at Spartica about the implementation of qualitycircles and kaizen in their factories and \"could we ever get it inSpartica? Not in a million years could it ever happen...You would258have to take the Spartica mentality top down and change it.\"Although there have been many demonstrated successes of QC andKaizen processes at Triad, several employees and managers notethere is less time for these activities than in the earlier yearsat the plant. In part, this has been the result of increasedproduction schedules; and in part due to a lack of commitment onthe part of all managers to a high employee involvement system.One manager remarks an ongoing focus on continuous improvementsystems requires \"continuous improvement. I think where we'vefailed somewhere along the line a little bit with that [QC andKaizen philosophies] is we failed to get commitment from managementon those concepts. People wanted to accept that, but not knowinghow to accept it, and being forced with how do you meet yourproduction needs?\" He adds he hears associates saying they want toparticipate in QCs and Kaizen, but their group leaders don'tendorse the processes. There is now more focus on production atTriad, and the company is \"less people-oriented\".Related to these sentiments, another manager adds \"when westarted up all the philosophy, the Kaizen philosophy, the Japanesemanagement approach to the actual workers, [it] was very highlypublicized and you know it was to be implemented; it has been. ButI think we stopped short in terms of training, in terms of ongoingunderstanding of what it's all about\". This manager believesworker involvement at Triad is becoming less and less all the time.New workers receive less training in Japanese managementphilosophies; there is no longer Japanese cultural training offeredin the orientation session, as received by the early recruits toTriad. Alternately, some senior managers have a different259perception of the success of QCs and Kaizen.^A manager inmanufacturing thinks the systems are operating \"very effectively\",and that there is \"more QC participation this year than I thinkwe've ever had since we started the plant\".From the associate perspective, the chairman of the bargainingcommittee comments \"the Kaizen system doesn't work like they[management] told everybody it would\". Originally associates weretold if a Kaizen project were approved, the associate would begiven the opportunity to work on the project and to implement thechange. But \"it doesn't work that way now...they [management]can't afford to leave you off the line because the manpower's soshort.\" Related to QCs, this associate mentions they were supposedto have one meeting per month, but in certain manufacturing areas,this is not the case. Another associate concurs with this,Quality circles, in the beginning I thought it wasfantastic. You had the time to do it. Now as productionhas increased and volume is up, more people are becominginjured or calling in sick. You don't have near the timethat you actually need to do a good Quality Circleproject. One thing we do need is more time to work on it[QCs] if that's considered really important. But most ofthe things in our area that should be done in a QualityCircle, we do them automatically. If we see a changethat needs to be made, we just implement it at thatpoint. So my group probably hasn't had a Quality Circleproject in probably a year.Consequently, the formal data collection and documentation which ispart of the QC process is not being completed.2604. Union-Management Relationsa) Mutual CommitmentsThe UAW was selected by the associates at Triad in December1988. The union contract was ratified in August 1989. The Triad-UAW contract is unique from many other contracts in the autoindustry, and has written into it guidelines which reflect some ofthe preferences of the Japanese partner in the joint venture. Forexample, there are only three job classifications and two payscales for all associates. Kaizen principles and techniques arerecognized as important to the process of continuous improvement inthe plant. There is a no strike, no lockout clause. Written intothe Triad-UAW contract the management of Triad pledge to,Maintain an environment which allows its employees tobuild the highest quality, most competitive pricedvehicle available in the automobile industry and therebyto provide significant job security for its associatesand prosperity and growth for the organization. TheCompany will provide a safe work place, equitable wagesand benefits and will promote an environment based on theteamwork concept which establishes \"Wa\", or \"harmonyamong people\" in a non-adversarial environment thatpromotes mutual trust and respect.In turn, the union commits to,Long term cooperation in the recognition and commitmentto the principle of flexibility that the Company musthave to maintain and improve quality and efficiency andto the implementation of work practices and flexibleproduction systems similar to those used by Japan Motorsin Japan. This flexibility includes, among other things,a minimal number of job classifications, flexibility injob assignments and job transfers, associate training,harmony among the associates, the use of Kaizen and theTeam concept.Associates are expected to support team participation and to beinvolved in the Quality Circle process.The language in the contract has been described by severalmanagers and associates as \"loose\", and therefore subject to261interpretation. According to the chairman of the bargainingcommittee it \"gives the company very many options, very many outs\".He adds the company has abused the flexibility written into thecontract agreement, which may be cause for changes in the languagewhen the contract comes up again in 1992. Issues for futureconsideration are likely to include the policy for paid time off(PTO), and supervisors who work on the line because ofunderstaffing. A manager in the HR department agrees there islikely to be some refinement to the contract, and more definitionadded. In his opinion, the basic philosophy, including theinfluence of Japan Motors will remain. Another manager is not asconfident the Japanese emphasis will be kept intact, and commentsthe union will \"want to make this as standard a UAW type factory aspossible\".b) The Unionization of TriadThere is some question as to whether Triad was required to bea unionized plant. One associate describes in the early days atthe plant he was strongly opposed to a union. \"Their tactics tocome in were very, very bad. And they were threatening people [tosign up].\" One employee mentions usually a card is signed ifworkers want to have a union election. At Triad, workers whosigned the union card gave their automatic vote to bring in theunion. Many associates did not understand they were voting in theunion if they signed the union card. An associate adds morerecently when there is a union vote at Triad, the union \"only geta third to a half the people voting. And the other half could careless, they'd rather not see the union here.\" Apparently, thisassociate thinks there are a group of \"radicals\" in the plant \"and262they're out to try to nail the company on anything. No matter howtrivial...And our problem is right now we have a bunch of radicalswho have gained control of the union. And so if they took a votenow out there I think the union would be kicked out because ofthat.\" In a recent election, the associates did vote out theentire union committee, except for one person. A group leaderagrees with the summation the relationship between the associatesand the union is \"not strong\". He explains there may be greaterfocus on union activities in the future, as more of the associatescome from other unionized plants like those belonging to GM,Chrysler or Volkswagon.From management's point of view, there \"was never any attemptwhatsoever to block the UAW\". Triad managers had decided earlythey would leave it to the associates as to whether they wouldunionize or not. In the view of one manager, Triad is not a strongunion plant. Most managers think union-management relations atTriad are positive. An American manager voices the relationship is\"probably one of the best in the country\". One Japanese managerconcurs there are \"no serious issues between the company and theunion.\" Further, a senior manager at Triad who is a Sparticaemployee notes the union-management relationship in the plant isbetter than in any of the other plants in which he has worked. Hementions he has an open relationship with the union steward, and\"the union steward came up the other day and said 'if there'sanything I can do to help you, let me know, I'll do it'.\" Heattributes the level of cooperation at Triad to the fact \"everybodywas pulling together right now, recognizing the fact that if you'regoing to stay in business you've got to be competitive. And the263way to be competitive you've got to drive the costs down and havethe best quality vehicle.\" However, another manager adds not allSpartica employees echo the view union and management can share aharmonious relationship. He adds \"the Spartica guys have carriedin a lot of very traditional ideas, not only about automanufacturing, but also about union-company relationships, abouthow people should be treated. They've carried that in. And ofcourse, they don't want to change.\" Some of the Spartica managersat Triad have \"very negative feelings\" for the UAW. Thisadversarial attitude between some Spartica managers and the unionis puzzling to the Japanese. In Japan, the \"union and the companywill work together to correct the behavior of an employee, whereasyou'd never find the union admitting that the employee did anythingwrong here.\"c) Understanding Employee PreferencesRelated to the ability of management to understand associateneeds and preferences, one HR manager feels his department couldhave a better \"reading\" of associates. Currently he explains HRresponds to the more vocal employees and subsequently \"spend 90percent of our time on 10 percent of the people\". He adds 90percent of the people are doing a good job and are dedicated to thecompany. These employees deserve more attention, but this isdifficult to provide due to staff shortages in the HR department.In particular, one issue of concern to a number of associates andsalaried staff is the Paid Time Off (PTO) policy. Similar to thetime off policy at Japan Motors, Triad employees get apredetermined number of PTO days a year, (i.e. 13 days for newemployees), to be used for all work absences including vacation or264sick days. In addition, each employee receives 32 hours of\"spontaneous\" time off, for use at the employee's discretion. ThisPTO replaces a more traditional policy of vacation days and sickdays as time off.According to one associate he does not like the current PTOpolicy at Triad, and adds American employees are used to havingvacation time and sick days considered as separate. In hisopinion, if an associate takes a sick day, it is as if he or she isloosing a vacation day. This associate notes many people areabusing the time off system as it currently exists. He thinks \" ifyou had a set vacation schedule, like two weeks or three weeks asit builds up, plus some sick days, it'd be a lot better. And Ithink that's what we're going to see fought for in our nextcontract.\" Another associate complains it is difficult to get PTOdays because of heavy production schedules. According to thisindividual, management had limited PTO days to one per day per crewand in this case, not everyone would be able to take off all theirallotted PTO days in a year. Also, not all groups in the plantoperate under the same time off guidelines, and this associateobserves some crews are able to have two people off at a time. Sheis unsure where this policy distinction originates, (i.e. withupper management, branch managers, or group leaders), but feels theinconsistency in the policy is unfair.2655. Reward and Recognitiona) RewardsThe primary form of reward at Triad are salaries provided tohourly associates and the salaried staff. In the case of salariedpersonnel, the amount of pay is based on a merit increase linked toperformance as determined by the annual performance appraisal.There is no bonus system related to individual performance foreither associates or salaried staff, and no profit sharing plan.However, there is an across the board annual bonus paid to allstaff. As part of the UAW contract, associates get a lump sumbonus adjustment. Triad management decided to give salaried staffa bonus in parity with that given to associates. Triad managerswho are employees of either Spartica or Japan Motors do not get thebonuses. Managers who remain attached to either parent company areon the payroll of Triad, and the JV is reimbursed by the parentfirm. In this regard, managers on the Triad site but who remainattached to the parent firm retain the salary and benefit plans ofthe parent company. Subsequently, three different salary andbenefit systems operate at Triad, although apparently this has notcreated any problems for the joint venture.One manager in the HR department reflects Triad needs a bonusprogram which is tied to productivity. Currently, HR managementare considering the implementation of such a program, and thinkthis will be an important step if Triad is to remain competitive interms of compensation compared to other auto manufacturing plants.To some extent, incentive plans have not been introduced to Triadbecause as one American manager explains, \"the whole idea ofmonetary rewards and things like that is definitely against the266Japanese way of doing things\". He says through the use of theKaizen concept people who know a job well are responsible forimprovements which make the job easier, safer, and moreinteresting. The improvement to the job is the reward in itself.This manager adds most \"kaizens\" cost the company money, as opposedto QC projects which often save Triad money.b) RecognitionIn the area of nonmonetary recognition as well, the Japanesemanagers at Triad do not advocate the distribution of awards inrecognition of specific employee contributions. A senior Japanesemanager explains employees should be proud of their work and theproducts which they make. This becomes the most importantintrinsic reward available to employees. He does not feel it isnecessary to have special recognition systems for individualperformance, but was more enthusiastic regarding the possibility ofteam recognition. One American concurs, and adds some recognitionprograms \"almost take away from the teamwork aspect you know, whenyou single out him or her as doing the super job. That is not teambuilding\". He adds he would not like to see recognition in theform of \"Engineer of the Month\", for example.Other American managers tend to think there should be aninfusion of recognition programs to Triad, especially for minorachievements. A manager suggests there should be pins and othersmall gifts given to employees for no lost time or projectaccomplishments. He points out Americans are different from theJapanese and appreciate some \"public acknowledgement\" for effort.Currently, the main source of recognition at Triad is related toperformance in Quality Circle projects. Plaques or certificates267are given to employees who participate in Quality Circles, and acertificate from the general manager is distributed to the personwho wins the Quality poster contest. There is a trip to Japanawarded to the group who have the best QC presentation, in orderthat they may participate in the Japan Motors QC competition. TheQC groups which perform well in the plant-wide presentationsreceive a gift such as a watch or gym bag, which in this casecreated a \"lot of strain\" because the Japanese managers at Triadare opposed to giving out gifts for performance. An associateremarks he would like to see more recognition of employees atTriad. He elaborates, \"I think it [recognition programs] wouldwork...in really all types of areas. In safety as well as workperformance on the floor. It's just a type of recognition, andthat's what you need basically on the floor - to know that the workthat you're doing is appreciated, and that they [management] arelooking at you.\"6. Staffing and Promotiona) An Influence from the JapaneseIn 1989 Triad reached full employment with approximately 3,000employees. In addition to Triad staff, there were fifty JapanMotors employees initially assigned to the JV in the uppermanagerial ranks (who mostly have remained), as well as a number ofcoordinators who assist in the manufacturing operation on anongoing basis. During the plant launch, Japan Motors alsodispatched about 200 technical assistants to Triad. In general,staff from Japan Motors are assigned for a period of three to fiveyears; and senior managers remain at Triad for a five year term.268Originally, there were 25 Spartica employees assigned to Triad asupper level managers for a five year period. In 1991, 12Spartica employees remained at Triad and represent the onlySpartica employees in the plant.The staff selection philosophy at Triad focuses primarily onhiring people with the potential to work as good team members, aswell as having other personal skills. Technical skills are ofsecondary importance. One Japanese Vice-President explains in the\"hiring process, we call it Wa, you know the harmony isimportant...not how good you are, not how good your abilities orskills may be...\" Senior Japanese managers who were involved inthe establishment of selection procedures at Triad note theimportance of a \"manager's subjective judgement\" in choosing a jobcandidate. For both associate and staff groups, the Japanesemanagers preferred to introduce implicit evaluation criteria, (i.e.the ability to have harmonious relationships with others), to theselection process, rather than to rely on objective point ratings.One Japanese manager said it is impossible for him to judge peoplebased on standardized criteria because \"everything should be athousand cases\", and therefore each case needs to be evaluateddifferently. Based on these considerations, there are two mainformats for hiring staff to Triad. All associates go through anassessment center operated by a local consulting firm. Salariedemployees apply to the HR department at Triad, and applications arescreened in-house to determine which candidates will beinterviewed.269b) Associate SelectionTurning attention firstly to the selection of associates, theassessment center procedures were developed by the consultingcompany, with input from the Japanese. In the early stages ofsetting up the assessment format, members of the consulting companywent to Japan to observe Japanese methods, and to talk with workersand managers in the Japan Motors plant. Interviews were held withJapanese managers already transferred to Triad. The consultantsalso spoke to Americans about what it is like to build a car andwork in an auto manufacturing facility. Following the completionof this preliminary ground work, the assessment criteria and hiringprocedures were determined. Individuals who are to be consideredas prospective employees for Triad are initially prescreened by thelocal employment office, and are given the General Aptitude TestBattery (GATB). An individual generally needs to score in the 70thpercentile or higher to remain in the screening process.Successful candidates are then referred to the assessment centerfor further testing. They undergo the Bennett Mechanical AptitudeTest and a group exercise. For the exercise, applicants wouldperform a group activity, and assessors would observe the processto determine how well individuals were able to function as part ofthe group. Triad candidates undergo a physical examination and adrug screen. The final step in the assessment process is astandardized interview. Candidates who proceed to the interviewstage have a 95% chance of being hired.Although the majority of employees have already been hired toTriad, the assessment center is still in operation. Now hiringusually is done twice per year. Triad management prefer to have270about 100 people in a \"ready to hire pool\" in order that additionalstaff can be quickly recruited when required. Generally, staffingat Triad has been \"lean\", and employees are working more overtimeand double shifts than they did in the early days at the plant.There are no temporary workers at Triad. A group of 56 permanentemployees fill in when needed, although the chairman of thebargaining committee feels this should be a larger group. As withother Japanese-influenced plants, there is a no layoff policy whichoperates in practice. One HR manager mentions they had hired anumber of new employees who were still in a probationary periodwhen the company experienced a downturn in schedule. Rather thanterminate staff, which he comments would have been typical in anAmerican style factory, all new staff remained with Triad.Based on the selection procedure, the associates at Triad arerelatively young and well educated. The average level of educationis fourteen years and reflects the requirement for a highly skilledworkforce which can rotate to various positions in the plant.There are only two job classifications, (as opposed to 60 or 70 insome plants), so associates are needed with \"interchangeablequalifications\". As one manager notes, the associates have highexpectations for advancement, and some have become frustrated dueto an inability to move to supervisory positions. This is the casedespite considerable upward movement of plant employees. Anothermanager notes in retrospect it may have been a good idea to hiresome people who would be satisfied with more routine activities.He also adds the physical demands of the manufacturing operationare considerable, and currently employees undergo a complexphysical examination. In the early stages of the assessment271process a routine physical was given, and as a result there havebeen too great a number of employees who suffer from injuries.c) Salaried RecruitmentHiring to the salaried ranks is done by resume submission,preliminary screening, followed by an interview with the managerfrom the department into which the candidate is to be hired.Managers receive training in interview protocol and use astandardized set of interview questions. Preference is given tosuitable internal applicants. As with the associates, staffing isnot based on technical skills but on potential to learn new skillsand function well with others. One engineer describes the peoplehired to his group did not necessarily have automotive skills, butrather were people who \"were open, a willingness to learn, had aninquisitive mind, were not necessarily at the top of their class -were down a little bit - but had done hands on type work and had anautomotive desire\". The Branch Manager for Quality Circle agrees.When he was first hired to Triad in 1987, he and others weredeliberately placed into jobs for which they had no previousexperience. He mentions this was done so people would be open tonew methods and not say \"well we used to do it this way\". Thisbranch manager, along with many others, went to Japan in order toget first hand experience in the new assignment.One manager in the manufacturing area explains the Japanesemanagers are heavily involved when hiring staff into upper levelpositions. He states the Japanese managers will likely hiresomeone based on a candidate's job history and the concept of\"face\" - the unspoken chemistry of how sincere and loyal the personis perceived to be. American managers are more likely to make272selections at the middle management level. When the first group ofAmerican senior managers were hired to Triad, many went to Japan tomeet with executives at Japan Motors. In the case of the HRGeneral Manager, he was in Japan for one week of interviews and metwith managers from labor, HR and manufacturing. He remembers, \"Imet almost all the top level management who were involved with theTriad project\". The HR General manager adds the Japan Motorsexecutives were seeking to determine whether hisPhilosophies were set to the traditional automotive[factory] or was I going to be able to adapt to newconcepts, new ideas, and try and build something new. Orwas I going to just be what they figured was thetraditional American management style, nonparticipative,'you're going to do it my way, we're not going to listento you'.The question which the HR General Manager repeatedly addressed washis position on labor and whether he intended to fight with orcooperate with the union. One Japanese manager remarks he felt theHR General Manager should be an American who knew about hiringpractices in the U.S., and who understood relevant legal and laborissues. Another Japanese manager who was directly involved in thishire, elaborates it was important to find someone who could helphim combine the cultures of both the U.S. and Japan. An ability tobe flexible was an important consideration. The emphasis onflexibility was echoed by American managers at Triad as well.Several said the most important qualities of JV managers arepatience, flexibility, and the willingness to look at another'spoint of view.Triad has a diversified employee population and 22% to 25% ofthe workers are women. Some of these woman hold managerial orsupervisory positions. There are four woman at the branch manager273level or higher and five to ten women who are group leaders. Onefemale branch manager remarks contrary to what she would haveexpected at a Japanese-influenced plant, she does not personallyexperience any discrimination and at Triad she \"just simply did thework; that's the only thing the Japanese pay attention to\".Another female branch manager feels although her skills areunderutilized to some extent, she has advanced \"fairly rapidlycompared to other people\". There is a point to which she will beinvolved by the Japanese, and after that point feels she will be\"cut off\".d) Staff TransfersThe majority of staff transfers have been employees of JapanMotors who come on assignment to Triad. As mentioned earlier,transfers from Japan Motors include senior managers, coordinatorswho provide engineering and manufacturing expertise, and technicalassistants. There are no transfers of Triad employees to Spartica.Some employees of Triad have been sent to Japan Motors fortraining purposes. A manager in the HR department notes there areno carry-over policies for employees who transfer from the JV tothe parent companies, or alternately for employees who transferfrom the parents to the JV. For example, if an individual choosesto leave Spartica and transfer to Triad, he or she would sever tieswith that company and begin again to accrue benefits and seniorityat Triad. Another HR manager says this policy was intentional, andaims to create \"allegiance all to the joint venture company, not tothe parent company\".274e) PromotionsIn the area of promotion, both associate and salariedemployees generally complain they are unaware of job vacancies inthe plant when they arise. There is currently no job postingsystem in place, and only infrequently will a job vacancy withinTriad be advertised in the company newsletter. A manager in the HRdepartment had tried to initiate a job posting program, butaccording to him it was \"killed by the Japanese general managers\"who felt it would take selection decision-making out of theirhands. The impetus for developing a posting program stemmed froman employee survey in which employees raised the absence of jobinformation as a major problem. However not all managers in the HRdepartment are in favor of job postings. Another manager remarks,I guess I'm a hardliner, an old traditionalist. I don'tbelieve in job postings. I think management should havethe right to select people and not be forced into takingpeople...Now from the standpoint of the employee havingthe opportunity of saying he wants to do that [apply foran available job], wants to be interested in the job,yeah, we should have some mechanism for those people toexpress what they would like to do.In once case, the Vice-President of Finance felt there should be ajob posting system, and initiated one in his own area.From the employee viewpoint, one manager mentions for salariedstaff there has not been a great deal of movement betweendepartments, and employees would like to be able to know about jobsand to apply to other departments. Neither salaried employees norassociates think the current bidding system is fair. One groupleader observes associates \"don't know what's open, when it'sopen\". On one occasion a production manager advertised for aposition in the community newspaper and received a \"flood\" of275applications from employees already working at Triad. Oneassociate explains, \"when there's an opening they call down to thegroup leader and ask him to submit some names of who he would liketo see promoted. That's it.\" This individual adds that associates\"would like to have more information. But one thing we can notfigure out is how they evaluate you to promote you. There's no setscale. One branch manager will make up a rule to get the personpromoted he wants. Another one will have just the opposite pointof view.\" Further, he adds \"to move up there really aren't thatmany opportunities. Not as many as I would say we were led tobelieve in the beginning.\"Related to this, there is no career path information availablefor employees at any level. Consequently, employees do not knowhow to develop in their careers in order to advance within Triad.The General Manager in HR states he would like to develop careerpathing, but again a shortage of resources in his department makesthis difficult.7. Training and Developmenta) The Context for LearningAs already discussed, employees were hired at Triad who had apotential for learning new skills, no preset notions of a singlebest way to accomplish a task, and the ability to work as teammembers. The intent by management was to train Triad staff inJapanese manufacturing technology and systems, as well as in athorough comprehension of the management philosophy as it exists atJapan Motors. The Executive Vice-President for Human Resourcesexplains the \"biggest result of sending them [Triad employees] to2 7 6Japan is that they are aware that on-the-job training is much moreeffective that classroom-type training.\" His opinion is that onlythrough experience on-the-job can people gain required knowledge.There is an emphasis on job rotation and learning multiple skillsto create flexibility in the manufacturing operation. Toaccomplish these goals, many of the employees at Triad went toJapan for training in the formative months of the joint venture.In total about 300 Triad staff spent time training at the JapanMotors factory in Japan. Most of these staff were at themanagerial level. In addition, 26 maintenance associates, wholater assumed the responsibilities of group leaders and unit groupleaders, spent 10 months in Japan receiving training. Once thephilosophy and manufacturing practices were established in the JV,the number of employees who now go to Japan for training has allbut stopped. However, several managers thought continued visits tothe Japan Motors plant would be advantageous for keeping alive thecommitment to the Japanese-influenced manufacturing and managementphilosophies which exists at Triad. Beside sending American staffto Japan, training was provided to people in the U.S. Triad plantby Japanese managers, coordinators, and technical assistants (TAs)who spent various amounts of time in the American-based operation.As the General Manager of Manufacturing elaborates, the TAs andcoordinators are experts in their field and were sent to Triad tocross-train the hourly workers, group leaders and branch managersin technical knowledge related to the vehicles which theymanufactured, as well as in process flow.277b) Multiskilled CapabilitiesWith reference to a multiskilled concept, associates aretrained to perform jobs which extend beyond their usual areas ofexpertise. For example, a millwright is able to use electrical ormechanical skills and can therefore be exchanged from one job toanother in the plant within the same job classification. Jobrotation is one of the components of the Japan Motors philosophyused in order to give workers multiskilled training. One associatedescribes when she first began at Triad in the trim area, shelearned about 22 jobs. Recently their group has been reorganizedso currently associates each do eight jobs, and therefore rotate toeach job every second day. Although some associates like the jobrotation system and note it is operating in their group, anotherassociate remarks the system is not in effect as originallyintended. He describes,It's not like they promised everybody in the beginning.They [management] promised you equal training and fullrotation of jobs, and they came to find out for some ofthese jobs that some people can't do or don't want to do[the job]. And there's other jobs that they won't letpeople do because they are preferred jobs and they handpick who they want to put on those. And everybody [theassociates] was under the impression that they wouldrotate through all aspects of the team concept here. Andthat just doesn't work. They [management] found out it'snot practical for them to implement that because of thebuilding of the cars and they have to have X number ofcars built a day, and if they have to train everybody allthe time they weren't getting their production out. Sothey pretty much stopped it.This associate continued that in preferred jobs like those off-lineor in robotics, some frontline supervisors would \"hand pick whothey want, and don't give everybody the opportunity. It's possibleyou might be just as good as the next guy, but if they[supervisors] don't care for you too much, or you're not one of278their favorites, you don't get that chance.\"A manager at Triad corroborates to some extent job rotationdoes not always work as originally proposed. On more highlyskilled jobs, supervisors want to retain employees in a task ifthey already have the necessary experience. A senior manager inmanufacturing observes at certain times, (i.e. when model changesare initiated), job rotation may be limited in order to get thehighest possible quality in the product. He also mentions jobrotation may be reduced in \"higher skill jobs\", but that in the\"normal, assembly-type operations there's very little reduction ofrotation\".c) Other TrainingIn addition to on-the-job training, various classroom coursesare provided for both salaried staff and associates. Associateshave been offered in-house training in Quality Circles and safety.Otherwise most training is offered by outside contractors. Thetraining department (which is part of the HR department), consistsof one individual who primarily arranges for courses and schedulestraining. Triad has a contract with the local State universitywhich supplies two courses for manufacturing associates. Onecourse is in basic automotive theory (75 hours) which about 150people have attended; the other course is basic welding which over200 Triad employees have received. Considering this training, inaddition to the extensive on-the-job training for associates, onemanager mentions to some extent salaried staff feel they aretreated \"second class\" by comparison.Associates who are new to Triad receive an orientation sessionwhich consists of a plant tour and an explanation of employee279benefits. The current orientation is much less elaborate than theprogram which existed at Triad during the first two years the plantwas in operation. At that time there was a 40 hour orientationduring which employees were briefed on each department in theplant, and had 8 hours of cross-cultural training. The culturaltraining included Japanese customs and culture, Japanese businesspractices and some rudimentary Japanese language skills. Theorientation program was scaled down once a huge state traininggrant given to the JV as part of the incentive to build in the areaexpired. In addition, production output increased, andsubsequently less time was available for such an extensiveorientation session.The training coordinator recognizes the need for expandedtraining programs for the salaried groups at Triad. Beginning July1991, additional training courses have been organized in the areasof the performance appraisal process, computer software, projectmanagement (for staff engineers), interview training, EEO/sexualharassment, and training for supervisors and middle managers. Inparticular, the training coordinator plans to broaden supervisorytraining. Subsequently, an HR manager describes that there hadrecently been an eight hour supervisory training seminar offered tothe branch manager level or higher, and the response from employeeswho attended the training was enthusiastic. Further, training willbe provided for group leaders and unit group leaders who haverecently advanced from associate status and who do not haveprevious supervisory experience. One manager remarks this groupneeds training in basic skills, (i.e. how to fill out time cardsand disciplinary forms), as well as in leadership. To meet this280demand, there is now a 32 hour supervisory course provided to groupleaders and unit group leaders by an outside contractor.To date, training has been readily available and there havebeen sufficient funds allotted to cover training costs. Thetraining coordinator mentions related to his training budget\"there's been more than adequate money allocated up to this point.\"A manager in the manufacturing area who is a Spartica employee,comments he often sends people on training courses. He cites oneexample when a system engineer was able to take a course in anotherstate for three days which cost $1700. He adds at Triad \"wenormally approve those things\". At Spartica he said he would nothave even submitted the request, because there would have been nochance for approval.8. Performance Appraisala) The FormatA performance appraisal (PA) system exists at Triad forsalaried (i.e. managerial, supervisory, administrative) staff, butnot for associates. Appraisals are completed annually fromFebruary to April and are used to determine salary increases foremployees. The \"Performance Planning and Review\" form is short andcontained on both sides of a single sheet of paper. One side ofthe form requires that performance goals are listed, and theaccomplishment of those goals is recorded on a five-point scale.There is an additional section on this side of the page (which isoptional) where an employee can state career interests and goals ordevelopmental needs. The reverse side of the performance reviewform lists thirteen \"methods/factors\" which are also evaluated on281a 5-point scale. Items to be considered include quality, teamworkor \"Wa\", Kaizen, cost consciousness, planning, problem solving,leadership, communication, job knowledge, EEO/AAP support,interpersonal skills, safety awareness, and attendance. Aninformation package accompanies the form in order to explain tomanagers the meaning of the various terms. In keeping with themanagement philosophy infused into Triad from Japan Motors,considerable emphasis is placed on interpersonal rather thantechnical skills. There is a focus on quality, effort dedicated tocontinuous improvement, and the maintenance of harmonious workrelationships.b) The Accommodation of Cultural DifferencesThe format for employee evaluation was made deliberately shortand simple in order that Japanese managers would be able tocomplete the form with a minimal amount of difficulty. Japanesemanagers were consulted regarding the format and content of theperformance review sheet. One of the HR managers explainsoriginally the Japanese managers at Triad did not want to doappraisals, and that in Japan an appraisal process does not exist.One Japanese manager notes the Japanese at Triad had \"severedifficulty\" with the idea of a review in which explicit feedback isgiven to an employee. He said \"most of the Japanese managers arenot accustomed to negotiation, and sometimes they were emotional.But now they are accustomed to this [PA] system and they know thepoints.\"The current system of performance review was implemented in1988. Prior to this time salary increases for employees were basedprimarily on length of service. To assist the Japanese in the282completion of staff appraisals, a manager in the HR departmentcomments their groupDeveloped a system, a program, that we thought was easyto understand. We spend some time in training. Weanswered their [Japanese managers] questions, and kind offorced them to do it. [We] told them this is the way ithas to be done in the United States. So from that theywere obviously very reluctant, didn't want to do it. Wemade some revisions to it [the review process]. Weincreased the training in the following year and nowthere doesn't seem to be much of a problem with it.Despite the attempt to streamline the PA system, there remainsome difficulties with the process. Triad managers who remainemployees of either Spartica or Japan Motors are appraised by theirsuperior in the parent company, if they have no superior at Triad.In the case of Japan Motors, the President or Executive Vice-Presidents at Triad will provide parent company executives withinformation related to the performance of Japanese dispatchees atTriad. Under the current system, managers at Triad do theperformance reviews of Triad staff, (i.e. who are neither JapanMotors nor Spartica employees), who report to them directly. Thereis a distinction however: Japanese managers will only be appraisedby other Japanese, but Americans can be appraised by Japanesemanagers. In the case of the Vice-President for Finance, forexample, he does not evaluate Japanese managers who report to himdirectly. This is done by one of the Japanese Vice-Presidents.Even given the responsibility to do appraisals, the Japaneseare hesitant to be involved in the process. One senior Japanesemanager mentions he prefers to have his American counterpart do hisappraisals on other American managers, although he does the PA forJapanese managers who report to him. From an American manager'sperspective, he notes the Japanese do not want to be put in the283position of evaluating an American and telling them \"how theyshould be as a person\". One American manager who is appraised bya Japanese superior notes the Japanese \"have a really rough time.They don't do that [PA] in Japan. And he hates it, he puts it offto the very last second. And they're [the appraisals] probablyfive minutes, if that. And he wants to get out as quick as hecan.\" This branch manager adds his Japanese supervisor rates allthe branch managers who reports to him the same. Another Americanwho is appraised by a Japanese manager states, \"I just received myfirst performance appraisal from my manager in April and it wasextremely good. But I wonder if he would actually criticize me, ifyou know what I mean. Or if he knows how to do it.\"Although there is no performance review system for associates,the Assistant General Manager in HR, who is Japanese, feels thereshould be one. He adds he would like to see pay tied toperformance, but wasn't sure how this could be done under a unionarrangement. This manager states there is a new agreement whichexists between Spartica and the union in which there are three orfour pay scales, and an employee moves to the next pay levelfollowing a review and based on performance. An associate agreeshe would like to see a performance review system in operation inorder that employees can have some idea of how they are doing onthe job. Related to not having a PA system in place he says,That's a big problem, very big. Simply because you havepeople who are working hard, going the extra mile, doingtheir job and they're getting the same amount of money asa person here who is not doing their job, or just doesenough to barely get by. So there's nothing thatseparates the two...even if you got some feedback frommanagement on 'you've been doing a great job, thank you'.Compared to the person who does not do their job. Justanything would be great. But you hear nothing.2849. Employee OpinionThere are clearly demarcated views held by Triad employeesabout the two parent companies who each have a presence in theplant. Although not generalizable to all Triad staff (who aremostly American), there is a clear preference by most employees whoparticipated in this study for the Japanese-influenced methods ofmanagement. There is less enamourment for the participation ofSpartica at Triad. One manager at Triad who is a Spartica employeedescribes this situation in the following way,When I first came here [to Triad] there was a tremendousresentment for Spartica. The Japanese were the heros.They provided this plant. Spartica put up half of it,but the Japanese were given the authority to manage andrun it in the agreement. So there was a tremendousresentment about American Spartica people being here...Alot [of Spartica managers] have left and a lot are guiltyof not doing anything when they were here. They took itas a free ride. Some of us didn't, and we made an earnesteffort to help and got involved. And those that did areappreciated more than they ever could have been backhome, because they helped fill some of those culturalgaps.Some of the difficulties experienced between the two parents hasfiltered well beyond the management ranks so associates are awareof some of the existing issues. One associate comments,The problem we're finding out, you have the Japanesemanagement on one side, the Spartica management on theother, and they don't communicate and so what comes downto you are two different views of the same thing. I likethe Japanese philosophy because I enjoy working hard andI get excited about being able to accomplish something.And the American management is, well, do what you can.It's not as, I want to say hardnosed, as the Japanese wayof life. The Japanese expect you to do a good job. Andyou don't have that same expectation with the Americanmanagers. They seem to manage through threats. Wherethe Japanese seem to say 'this is your job. It needs tobe done'.This associate elaborates the Japanese on the floor are well liked285and respected. In contrast, he mentions the Spartica managers areSnobbish, arrogant, they won't come down and talk toanybody. If you say 'hi' to them, it's just, they keepon walking. Where the Japanese managers will stand andtalk to you. Even the President when he was on thefloor, he'll stop and talk to everybody. You don't havethe same with the Spartica management.He said in his view he sees Spartica managers who \"tend to blameeverything on the Japanese management...If you can't get a straightanswer it's blamed on the people who weren't there, which isnormally the Japanese management...One thing I would love to see isif the Japanese take completely over. Because I like theirmanagement style a lot better than the American or Spartica styleof management.\"Two American managers who have previously worked in automotivefactories in the U.S. both remark there is greater respect for theindividual in the Triad plant than at other plants where they havebeen employed. One manager notes,While I don't always know what's going on, I'd have tosay that I've been treated better here in the last fouryears than I've ever been treated any other place I'veworked, in terms of respect for the way you're treated...I would never have this opportunity any place else, I'velearned more in four years than I did in all the otheryears I worked any place else. I probably learned twiceas much.This same manager mentions there have also been difficulties. Inparticular, these difficulties stem from working in a jointventure. Related to this he says,Probably the biggest thing in terms of joint ventures, orI should say working with the Japanese, or with any otherculture, is the fear - the uncertainty of the otherculture...there's more emotion involved in coming to workhere everyday in a joint venture environment betweenforeign companies, and working for a foreign company inyour own country....It's been difficult. I think it'sharder if you're a person that likes direction andcontinuity and those kinds of things, and constancy or286whatever. If you like all those kinds of things, it'salways changing here.A second American manager with previous auto plant experience alsolikes to work at Triad. He observes \"it's a good place to work\",adding the Japanese and the American workers get along. There are\"no yelling contests\", where in other auto plants \"it was how wellyou could demean somebody\". He said at Triad people do not raisetheir voices. At other plants he remarks \"everyday you'd wonderhow many battles you were going to get into at the plant. Well,here you don't get into any.\"One other element employees seem to like about Triad is thesense of equality derived from all staff wearing uniforms, from thepresident to associates. An American manager observes Triad is nota strong union plant and with respect to this he states,You know what I think makes a lot of difference to all ofthat [i.e. regarding union support] - this uniform, thebreakdown in how you're perceived in the shop. The factthat my engineers are out there right now, and if wewalked out on the floor you wouldn't be able to tell themanager of production from a guy on the floor. And inall my years of working with a tie and out on the floor,you might as well walk around with a sign on your head,'I'm better than you. I'm management. You're nothing.'And you know, believe it or not I think the uniforms makea big, big difference. Everybody's the same.An associate verifies this sentiment and does think the uniformshave an equalizing effect: \"That's nice. Even the President hasgot the same thing on. You know they don't show any 'I'm betterthan you. I'm a manager. You're just an associate'.\"287E. Results of the Employee QuestionnairesA total of 38 employees responded on the questionnaires. Thisgroup includes 27 men and 11 woman. The average age of therespondents was 34.68 years, with a standard deviation of 6.8years. There were no employees in the group who had not completedhigh school, 15 had a high school education, 16 had some college,6 had completed either a BA or BSc degree. One person did notindicate the educational level. The average years an employee hadworked at Triad was 2.13 years, with a standard deviation of .93years. Twenty two respondents had not been absent from work in theprevious year.1. Minnesota Satisfaction QuestionnaireMean scores and standard deviations for each item of theMinnesota Satisfaction Questionnaire (MSQ) are displayed in Table9 as aggregated scores across all respondents. Overall jobsatisfaction and scores for intrinsic and extrinsic jobsatisfaction are also presented as aggregate mean scores. Triademployees who responded on the MSQ demonstrate a moderate level ofoverall job satisfaction. The percentile score for overallsatisfaction is 69.47 which is somewhat below the 75th percentileidentified in the MSQ manual as the relative cut-off point for highlevels of job satisfaction. Standard deviation of responses forthe overall score is 13.34 which indicates considerable variationof employee responses around the mean. Percentile scores are quitehigh (74.33) for intrinsic job satisfaction and moderate (59.37)for extrinsic satisfaction. These scores are presented in Table ??as aggregated mean scores out of a maximum score of 5 for a single288test item. Based on these results, respondents indicate theyaccrue intrinsic satisfaction from being able to keep busy (4.21),the chance to work alone (3.87), and the chance to try one's ownmethods on the job (3.71). In particular, employees think Triadprovides steady employment (4.61), and to a lesser extent has goodworking conditions (3.81). In the area of extrinsic jobsatisfaction scores are considerably lower, indicating respondentsare only moderately satisfied with Triad employment policies andpractices. More specifically, related to extrinsic satisfaction,employees indicate they do not favor the way one's boss handles hispeople (2.68), the amount of praise received for doing a good job(2.74), or the competence of the supervisor's decisions (2.92).Scores related to chance for advancement (2.82) and the way companypolicies and practices are put into operation (2.47) are fairlylow. However, in the extrinsic category, employees indicate theyare satisfied with their pay and the amount of work which they do(4.18).In July 1989 researchers from two local universities conducteda questionnaire study which focused on occupational preferences ofTriad employees, as well as other economic, sociological andcultural factors. Responses were scored on a five-point scale asin the current research. Two hundred employees were randomlyselected to participate in the 1989 study. Although thisquestionnaire was distributed two years prior to the questionnaireswhich were completed for this research, there is consistency inmost areas concerning job-related items. For example, in the 1989study, 48.10% of respondents scored 4 or 5 (out of five) indicatingthey were satisfied with their wages, 61.43% scored 4 or 5 related289to the work environment, and 53.34 scored 4 or 5 for worksatisfaction. On the lower end of the scale, and also consistentwith the results of the MSQ questionnaire, 50.48% of respondentsscored 1, 2, or 3 (again out of five) on their perceived chancesfor promotion. Unlike the results of the MSQ, two years agoemployees scored quite highly as to how they felt about supervisorsand managers at Triad. Considering the performance of groupleaders or supervisors, 44.29% of employees scored 4 or 5; relatedto the performance of branch managers and general managers, 37.62%of the respondents scored 4 or 5. In contrast to these scores,employees now indicate mean scores on the MSQ of 2.68 (out of five)for \"the way my boss handles his people\", and 2.92 for the\"competence of my supervisor in making decisions\". According tothis comparison, it would appear in 1991 employees are lesssatisfied with their supervisors than they were in 1989.2. The Culture InventoryResults of the Culture Questionnaire appear in Table 10. Aswith the results of the MSQ, scores are represented as aggregatedmeans for each item of the questionnaire. Mean scores are alsolisted for each cultural category represented on the inventory:group, developmental, hierarchical and rational cultures. Inaddition, the overall score for the Culture Questionnaire islisted. Triad employees scored highest on the rational culturecategory (9.97) which indicates there is some focus at the plant onachievement, production and task accomplishment. Respondents onthe Culture Questionnaire scored just slightly lower on thehierarchical category (9.16) which means there is also some290emphasis on rules, order and documentation. There is not strongevidence for either a developmental culture (8.03) in which thereis encouragement for innovation and creativity, or for a groupculture (7.11) which would reflect the company is viewed as apersonal place to work, with an emphasis on human resources.3. Guide to Human Resource Management PracticesBoth the HR Executive Vice-President (who is Japanese) and theGeneral Manager for HR (who is American) completed the HumanResource Management Inventory. There is variable consistency as tohow these two individuals perceive HRM practices operate at Triad.The areas where discrepancies occur are not surprisingly related todifferences in perspective related to the national culture to whicheach of these managers belongs. For instance, differences occurregarding the length of time-frames which operate (i.e. long-term/short-term), whether there is a group or individualphilosophy, the amount of employee involvement which exists,whether evaluation is based on the total person or on performanceonly, the speed of promotions, and finally, the extent to which jobrotation and employee input occur.In the area of HRM planning, both managers consider the systemto be fairly informal and flexible, and integrated with the plansof other departments. There is a low amount of risk-taking. TheJapanese manager thinks planning is more long-term than does hisAmerican counterpart. Related to employee involvement, theJapanese view is there is relatively high involvement because of291Table 9Results from the Minnesota Job SatisfactionQuestionnaire at Triad MotorsAs Aggregated Scores Across All RespondentsItem Mean SD1. Able to keep busy 4.21 .742. Chance to work alone 3.87 1.093. Chance to do different things 3.68 1.344. Chance to be somebody in thecommunity3.45 .955. Way my boss handles people 2.68 1.446. Competence of supervisor'sdecisions2.92 1.307. Able to do things that don'tgo against my conscience3.89 .808. Job provides steady employment 4.61 .559. Chance to do things for others 3.58 .9510. Chance to tell people what to do 3.32 .7411. Job makes use of my ability 3.34 1.4412. Way company policy is put intopractice2.47 1.1613. Pay related to the amount of work 4.18 .9514. Chance for advancement 2.82 1.2315. Freedom to use my judgement 3.47 1.1316. Able to try my own methods 3.71 1.0617. The working conditions 3.81 1.0618. The way coworkers get along 3.24 1.1019. Praise for doing a good job 2.74 1.1320. Feeling of accomplishment from thejob3.47 1.06Aggregated Category ScoresMean SD PercentileIntrinsic Job Satisfaction(items 1-4,^7-11,^15,^16,^20)44.60 8.42 74.33Extrinsic Job Satisfaction(items 5,^6,^12,^13,^14,^19)17.81 5.04 59.37Total Job Satisfaction 69.47 13.34 74.33(items 1-20)292Table 10Results from the Culture Inventoryat Triad MotorsAs Aggregated Scores Across All RespondentsMean SD2.34 .972.00 .932.50 1.063.50 1.112.24 .972.92 1.153.03 1.173.00 .902.53 1.253.11 1.113.63 1.083.47 1.06Item1. A personal place2. Dynamic and entrepreneurial3. Formal and structured4. Production-oriented5. Loyalty and tradition6. Commitment to innovationand development7. Formal rules and policies8. Tasks and goal accomplishment9. Emphasis on human resources10. Growth through new ideas11. Permanence and stability12. Outcomes and achievementAggregated Means for the Culture CategoriesGroup Culture 7.11Developmental Culture 8.03Hierarchical Culture 9.16Rational Culture 9.97Total Score 34.27293the kaizen process which operates at Triad. The American manageralternately thinks there is moderate employee involvement.Finally, HR planning is seen by both managers as based on anoverall group philosophy, except in the area of training which isconsidered more individually focused.Staffing is based on internal recruitment, and people can behired to a position with minimal experience. Orientation sessionsare used. There are many career paths for employees althoughcareer path information is generally unavailable. Hiring andpromotion criteria tend to be ambiguous and unstated.Discrimination based on either gender or social class is low.There is extensive overtime.With respect to Performance Appraisal, there is considerablevariation in response between the two managers related to how thesystem operates. The American General Manager views PA as based onperformance, with PA criteria and goals set for the long-term (i.e.more than one year). In contrast, the Japanese manager thinks PAis based more on the \"total person\" and goals are shorter-term.Both managers agree employee participation in the reviews is high.Also, both managers believe the PA is based on individual criteria.The Japanese VP adds the caveat the overall company philosophy isoriented to the group, but that in practice in a U.S. setting thereis more of an individual emphasis. Both managers agree feedback toemployees is implicit, but the Japanese manager adds there are alsoelements of explicit feedback. He says the perception of whetherfeedback is either explicit or implicit is tied to whether theindividual involved is Japanese or American. Although the Americanmanager indicates promotion is rapid, the Japanese manager294indicates differences in perception exist, again depending onwhether the individual is Japanese or American. He notes Americansfeel promotions are slow, while the Japanese think they are rapid.Whereas variations exist between the two managers related toPerformance Appraisal, their perception of how reward systemsoperate is very similar. Both managers agree there are fairly highbase salaries at Triad, and that reward packages are standardizedand fixed. Rewards which are primarily in the form of salaries areconsidered to be egalitarian and open. There is high employmentsecurity. Few \"perks\" are available to Triad staff.Training is broad and general, and mostly provided in-house.Much of the training is on-the-job (especially for associates), butthere is also some classroom training. In the case of supervisorytraining, outside consultants will be hired to provide training atTriad. There is a group orientation to training, but the JapaneseVP notes in the case of on-the-job training there is an individualorientation. The Japanese manager thinks training tends to bebased on a short-term focus, while the American manager believes itto be more long-term. Also at variance, the American managerthinks employee input to training is low, while the Japanesemanager thinks it is relatively high. The American manager notesthere is considerable job rotation in operation at Triad, while theJapanese manager perceives job rotation to be relatively low. Hepoints out employees would prefer greater job rotation, butsupervisors limit rotation because it reduces the skill levelsrequired of employees in some areas.295F. Summary of the Results1. At the time this research was conducted, Triad was a 50/50joint venture between two large parent firms - one Japaneseand the other American - in the automotive industry. Triadwas formed in 1985 and began production in 1988, and isconsidered the most technologically advanced auto assemblyplant in the world. In 1991 the Japanese parent became 100%owner of the company.2. At the JV inception, Spartica involvement assured access toits distribution networks of Triad products which were to besold in the U.S. In the early stage of the JV formation, bothparents agreed Japan Motors would take the lead in themanagement of the plant. Japan Motors provided advancedtechnology and the manufacturing philosophy to the JV.3. Based on the management influence by Japan Motors, Triad hasa just-in-time production system, operates using \"Kaizen\" tofacilitate continuous improvements in the plant, and aims toprovide cross-training and job rotation to employees. Thereis a no layoff policy in operation. Uniforms are worn by allstaff to promote an egalitarian orientation.4. The JV Board of Directors are also the upper tier ofexecutives in the plant. Key executive positions arecounterbalanced between managers who are either Japanese orAmerican. Although some decision-making occurs at the plantlevel at Triad, many of the upper level decisions are left toJapan Motors executives located in Japan.5.^The strategic orientation of Triad focuses on quality and296continuous improvement which is achieved in an environmentwhere employees work together in a team effort to accomplishthe JV goals. A cooperative relationship between the companyand the union is encouraged.6. One of the key challenges at Triad has been to establishproduction and personnel policies which take into account theneeds and requirements of primarily American employees whowork in a system highly influenced by the Japanese parent.Both American and Japanese managers seek to understand eachother on a day to day basis in the plant. This task is madedifficult by the various perspectives and styles each managerbrings to the JV, which are rooted in the national culture towhich each belongs.7. HR had an early role at Triad. HR managers were responsiblefor the coordination of hiring 3,000 staff to the JV, and forcreating HR policy appropriate for the company which drew fromboth Japanese and American management practices.8. Managers emphasize communication is the most pervasive problemat Triad. Some of the difficulty in communication relates toculture and the predominance of both English and Japanesewhich is spoken by managers. In addition, information is noteffectively passed to associates by supervisors or othermanagers.9. Employees are encouraged to actively participate in theidentification and correction of problems in their work areas.Both Quality Circles and \"Kaizen\" operate as part of thisprocess, although employees recently identify they do not haveas much involvement as they did in the early days at Triad.29710. Union-management relations at the plant are generally good.The union contract is flexible and allows the company tooperate in a manner which reflects the manufacturing andpersonnel preferences of the Japanese partner in the JV.11. The primary form of reward at Triad are salaries. Performanceis not linked to employee productivity.^Few recognitionprograms exist, although the management at Triad generallyacknowledge the need for greater recognition of employeeachievements in the future.12. Staffing of associates is done through an assessment center.There is a focus on internal recruitment at Triad. Employeeswould like to see a system of job postings in place,especially for salaried positions, in order that they can bebetter informed of available positions.13. In the early days of the venture, many managers went to Japanfor training.^In addition a large number of Japanesedispatchees came to Triad to provide training on-the-job forassociates and supervisors.14. Performance appraisal exists for salaried staff, but not forassociates. Many of the Japanese managers are unaccustomed toa PA process, and have difficulty implementing the system.15. Employees are generally enthusiastic regarding the involvementof the Japanese partner at Triad, and are less positive aboutSpartica involvement.16. Overall, employees at Triad indicate moderate jobsatisfaction. Employees think there is considerable autonomyon the job, and high job security. They are less satisfiedwith company policies and practices, and the performance of298supervisors.17. Generally, Triad employees consider the JV to have someemphasis on production, task achievement, rules anddocumentation. They feel there is less emphasis on creativityand innovation or a human resources orientation.299PART THREE: CROSS-COMPANY COMPARISONSIntroductionThe results of the research for Mayo Forest Products, OCGOptima and Triad have been outlined in detail for each company inthe preceding sections. In the pages which follow, cross-companycontrasts and similarities will be considered. Collectively, thefour JVs which are investigated in this research afford anopportunity to examine some of the central features and processeswhich operate related to HRM in international joint ventures.As a summary of the previous sections, Table 11 outlines thekey characteristics of the four joint ventures in this research.The strategic philosophy for the venture, HR policies andpractices, special issues which exist in each JV, as well as thecorporate culture for the ventures are noted. In addition,outcomes for the JVs and perceived levels of employee jobsatisfaction are included. These issues frame the followinganalysis of the four joint ventures in this investigation.The analysis of the companies outlines a wide variety ofcommonalties and differences between the JVs in the investigation.In general, the topics parallel those in the preceding section inwhich the data from the research is elaborated. The analysispresents an integrated picture of how strategic HRM operates inthese companies. More specifically, the following topics areconsidered:• the joint venture form• the strategic management orientation• subgroups which operate in the ventures300• various HRM functions• the employee questionnairesInferences and interpretations of the data are discussed in thesection which follows the analysis of the JV cases.TABLE 11CENTRAL FEATURES OF THE JOINT VENTURESMAYO^OCG^OPTIMA^TRIADhigh quality innovative customer high qualityStrategic low cost low cost satisfaction; TQM TQMPhilosophy involvement involvement involvement involvementQITs, CATs cross-functionalteams QITs, CITs,CATSKaizen, QCsHR not strategic; high involvement; high involvement; creation ofDepartmental supervisors only one HR staff adequate staff \"hybrid\" policyRole implement HRM personCommunication employee feedback intercontinental employee feedback; problematicSystems statistical links '^technological re nationalreporting links culturepay not based on individual & team pay for skills pay not basedReward performance rewards;bonuses for individuals, not on performanceor teams technologicalaccomplishmentsteams or teamsmany forms; some; under many forms; created generallyRecognition intended to be development by associates in limited, butmeaningful plants; intended tobe meaningful available forQuality CirclesTABLE 11 continuedMAYO^ OCG^ OPTIMA^TRIADStaffingpersonal skills;team players;no job postingstechnical/personalskills;team player;job postings: Olin;many upper levelmanagers from Olintechnical/personalskills;team player;no job postings(upper management);many managers fromFiberopbroad skillsteam members;no job posts;balanced bet.Japanese andAmericansstrong; especially wide-based:salaried cross-training job rotationTraining for productionemployeessome job rotation some job rotation multi-skilledQC emphasisPerformance not done Performance considers special formatAppraisal Mgmt. Process innovativecontributions for Japaneseunion-management; integration of transfers; nationalSpecial shifting roles parent employees; self-managing work culture;Issues R&D - manufacturing teams; shiftingrolesunion-mgmtOutcomes quality up #3 in industry customer and high qualitycosts down ahead on sales service awards low costsJob moderately high moderate high moderateSatisfactionCorporate achievement achievement achievement achievementCulture production production production productioninnovation innovation rules/order303CHAPTER EIGHTA CROSS-COMPANY ANALYSISA. The Joint Venture Form1. Specialization or Value-Added VenturesAll joint ventures in this study are the product of a unionbetween two large multinational corporations. OCG, Optima, andTriad are 50/50 joint ventures, while Mayo Forest Products is a60/40 equity split between the partners. Both Mayo Forest Productsand Triad are examples of a \"specialization\" international jointventure. According to Lei and Slocum (1991:52) \"specializationventures are those to which each partner brings and contributes adistinctive competency in a particular value-adding activity (e.g.,one produces, the other markets).\" This form of joint venture ismost likely to be organized around defined functions or roles. Inthe case of Mayo Forest Products, the roles of each of the parentcompanies are well determined. Mitsubishi is responsible formarketing 85% of the lumber product to Japan. Canadian PacificForest Products (CPFP) handles marketing to other destinations,ensures a steady supply of raw resources in the form of logs, andhas the management contract for the mill. The management groups ofboth parent companies perceive that they benefit from thisarrangement, and that each are able to contribute complementaryability and competency to the success of Mayo. PrimarilyMitsubishi provides the JV with market access and distributionnetworks in Japan; CPFP contributes raw lumber resources to theventure.304Likewise, at Triad the roles of each parent are definedspecifically. The benefit to Japan Motors is clear. The Japanesemultinational gains access to the American market, and has accessto Spartica's distribution networks for the marketing and promotionof products in the U.S. In turn, Japan Motors brings advancedtechnology and the manufacturing and management style to the plant.Originally, an objective at Spartica was that several of theirmanagers would transfer to Triad in order to have exposure to, andlearn from the Japanese methods. In reality, this objective didnot materialize to the degree that Spartica management had hoped,and within a couple of years into the venture, approximately halfof the assigned Spartica managers returned to the parent firm.With the return of many managers from Triad to Spartica, (which wasinitiated from the American partner), the opportunity for Sparticastaff to learn new procedures and techniques was automaticallyreduced. In addition, the financial benefits of the union toSpartica were less obvious, especially because some of Triad'sautomobile products were in competition with Spartica's own models.In this case, the joint venture was dissolved. At this timeSpartica was suffering huge financial deficits. The sale ofSpartica's equity in the JV was required as a way to offset otherfinancial losses which had continued to plague the parent firm.Alternately, OCG and Optima are examples of \"value-added\"international joint ventures.^As Lei and Slocum (1991:52)describe:^\"in the shared value-adding ventures, partnersparticipate and share in the value-adding activities together(e.g., both design and produce jointly).\" The partners haveindependent expertise in related areas, and each feel that they can305benefit from the union which the joint venture provides. At OCG,the photoresist business of Olin Hunt is combined in acomplementary way with the photoresist and polyimide businesses ofCIBA-GEIGY. At Optima, the cable development technology of Baueris combined with the optical fibre expertise of Fiberop. Theseventures provide the partners with the opportunity to share boththe risks and costs required to compete in high development-costindustries. Although the potential for valuable technology of oneparent firm to be lost to the other parent exists, this concernmust be balanced with the possibility of gains in the internationalmarketplace. In this case, at both OCG and Optima, the parent andJV managers feel the union is worthwhile. These venturepartnerships have already attained greater product excellence inthe particular JV market sector than either parent could attainalone.2. Dominant versus Shared Management VenturesBased on previous research on joint ventures, Killing(1983:16-22) categorizes JVs as operating under three differentmanagement styles: dominant parent JVs, shared management ventures,or independent ventures. Accordingly, in dominant ventures, theJVs are staffed entirely by one parent and \"managed by theirdominant parents virtually as if they were wholly ownedsubsidiaries\". The \"board of directors, although containingexecutives from each parent, plays a largely ceremonial role.\"Alternately, Killing describes a shared management venture as onein which \"both parents play a meaningful managerial role.\" Theboard or executive committee is likely to have real influence, the306partners share technical or product expertise, and both parentshave an active role in the decision-making required for the JV. Inindependent JVs the general manager has autonomy for makingdecisions which affect the JV, without need for recourse to a JVboard.With reference to the above designations, all of the jointventures in this research are shared management ventures. OCG,Optima, and Triad have representatives from both parents in the JV.Mayo Forest Products, which has the least amount of involvementfrom one parent (Mitsubishi) in the plant operation, hasconsiderable involvement from the Japanese partner in marketing andat the board level. Shared decision-making is evident at the JVboard level in all the ventures.To elaborate on the board structures in the joint ventures inthis study, each company has in operation 1. a formal JV boardcomposed of executives from each of the parent firms, as well as2. an advisory committee which is largely responsible for theoperational management of each venture. The JV boards primarilyapprove major capital expenditures and review budgets in order tosafeguard the financial interests of the parents. At OCG, Optimaand Triad there is equal representation from the two parents on theJV board. At Mayo Forest Products the board is comprised of threemembers from Mitsubishi and four members from CPFP.In the operational management of each venture, the parentresponsibilities are also generally shared. At OCG and Triad thereis active involvement from both parents at the executive levels.Optima has less influence from Bauer at the executive level,however a key position related to the exchange of technical307information between the JV and the German parent (the Vice-President and Director of Cable Technology) is staffed by a Bauerrepresentative. In addition, at OCG, Optima and Triad there arenumerous exchanges of specialized personnel (especially in the R&Dand technological areas). Mayo Forest Products is a shared jointventure because of the complementary, but separate, roles played byeach parent. However, Mayo Forest Products is very close to thedominant form of joint venture. Canadian Pacific Forest Products,which is 60% owner, provides the majority of strategic leadershipin the venture. In fact, as one CPFP executive remarks, Mayo isnot managed \"appreciably different than our other [CPFP] sawmills\".This same executive perceives the JV board to be largely\"ceremonial\", to use his term. The advisory committee, which doeshave members from both of the parents as well from the millmanagement, is the working committee for the JV, and in this senseit is responsible for planning directives at Mayo.3. The JV Management ContractIn the joint ventures in this research, the managementcontract for the ventures generally was assigned to one of theparent firms in the early stages of the JV formation. Theexception is Mayo Forest Products. In this instance, themanagement for the mill was allocated to CPFP at the time of thereorganization in 1988, when a need for better defined roles forthe parents was decided. With respect to the joint ventures inthis study, the parent firm with the management contract has drawsubstantially on that parent's resources related to the strategicand HR orientations for the venture. Subsequently, the parent with308the management contract generally has had the greater degree ofinfluence related to both HRM systems and the corporate culturewhich operate in the venture.At Mayo Forest Products, although JV staff were independentlyhired to the JV, the strategic orientation for the mill is similarto other CPFP operations. In addition, the consulting companyemployed to refocus many of the HR-related policies at Mayo hadbeen used by the Canadian parent in other mill reorganizations. HRpolicies for salaried staff at Mayo have been adapted from those atCPFP.In part, the decision by OCG partners that Olin would have themanagement contract is related to the large percentage of Olinemployees who are employed in the venture. Further, OCG is in thestart-up phase of its operation, and related to a demand formultiple new HR policies to be quickly implemented in the venture,OCG management decided to initially adopted HR policies from Olin.The Quality program and related performance review process havebeen taken from the American parent. Training for OCG employees isdone primarily in the extensive Olin training facility. Thenewsletter currently distributed to employees in the venture is aproduct created for all Olin operations.At Optima, the parents have a counterbalanced arrangement;Fiberop manages the JV in the U.S. location, and Bauer has themanagement contract for a jointly shared JV in Germany. HR staffat Optima have many linkages with their counterparts at Fiberop.Training content and the reward systems for salaried staff atOptima are very similar to those HR practices found in the parentfirm. In addition, the strategic focus at Optima is derived309largely from directives also employed by Fiberop. The upper ranksof the joint venture are staffed primarily by former Fiberopmanagers.Finally, at Triad, both the managerial and the manufacturingfocus for the plant have been taken from Japan Motors. Kaizen;Quality Circles; the union-management philosophy; staffing, reward,training initiatives; job rotation; and a no lay off policy haveall been largely adapted from the Japanese parent. This decisionwas made in early JV contract negotiations, in order to bringJapanese methods into the American plant. In the HR area, staffhave created modified policies which suit the styles andphilosophies of an American workforce.Although the management contract rests with one parent in theventure, in general each JV functions independently at theoperational level. Employees in the ventures tend to identify thatcontinued JV independence is related to the success of the venture.Further, the ability to effectively manage interorganizationalrelationships between the parents and the JV is consideredimportant if JV managers are to sustain parent trust. Many of thecharacteristics identified by senior managers in the JVs as centralto this process are remarkably similar. For example, at MayoForest Products patience, trust creation, and objectivity indealing with multiple stakeholders, including the parents, arementioned. In particular, the General Manager at Mayo ForestProducts suggests that managers require \"a good understanding ofthe politics of the business\", and must avoid playing one partneragainst the other. At OCG, understanding both the JV and parentcultures, and openness to what the parents have to offer the JV is310considered important to the management of parent-JV relations. AtOptima, an open mind, and an ability to retain credibility with JVand parent staff are noted. In addition, the establishment ofpersonal contacts and the exchange of staff are thought tocontribute to the development of favorable interorganizationalrelationships. At Triad, patience, flexibility, and the ability toconsider another's point of view are key.Related to personal qualities important to the management ofparent-JV relations, executives at various JVs note that personalrelationships between upper level staff, and \"chemistry at the top\"are critical for the maintenance of harmonious partnershiprelationships. As one manager at Optima elaborates, much of thesuccess of the interactions between senior members of the parentfirms and the joint venture are related to \"the nature and thepersonality of the individual people involved.\" This same managermentions the importance of establishing long-term contacts betweenindividuals in the parent firms and managers in the venture.B. The Strategic Management Orientation1. The Joint Venture ObjectivesIn the determination of strategic initiatives, each of the JVshas an established model from which to draw insights and methods.At Mayo Forest Products managers were assisted by the consultingcompany employed to help with the reorganization plan in 1988. OCGadopted the Total Quality Management system which operates at Olin,and which was originally modeled after 3M (Minnesota Mining andManufacturing Company). Optima uses Fiberop's Total Quality311Management program which is an adaptation from the programestablished at Milliken. At Triad, the orientation toward qualityand continuous improvement derives from the philosophies andmanagement styles which exist at Japan Motors.There is much similarity in the strategic management goals andobjectives which aim to facilitate the success of Mayo ForestProducts, OCG, Optima and Triad. Staff in all four companiesstrive to implement a \"Total Quality Management\" system which will:enhance production creativity and innovation; consistently meetinternal and external customer requirements on time, every time;and demonstrate cost efficiency. Employees are encouraged to beinvolved in decision-making in their work areas through systemswhich focus on teamwork, \"ownership\" of work responsibilities, andproblem-solving oriented toward continuous product and processimprovement.To fulfil designated strategic objectives for the JV, managersand other staff are to be actively involved in processes whichfacilitate the realization of a Total Quality management system.In general, the cornerstones to the activation of high employeeinvolvement systems in the JVs in this research encompass thefollowing:• Communication systems which provide multiple forms ofinformation and feedback to employees. This occurred inall four JVs in the form of meetings, charts, telephoneand written correspondence. Managers determined that ifemployees are well informed in the areas of productinformation, costs, and policies and procedures, thenthey are able to make better decisions, and to produce312higher quality products. Feedback to employees on avariety of dimensions is important in order that they mayidentify areas where improvements are required. In someinstances (i.e. at Mayo and Triad) this takes the form ofstatistical reporting. At OCG, where operations spanthree continents, world-wide teleconferences and meetingsare used as a way to communicate among employees.• At all four JVs, education and training for employees arecentral to providing staff with better skills in order toparticipate in the work environment. To facilitate andmaintain flexible manufacturing systems, employeesreceive wide-based training. At Optima and Triad, thistraining enhances employee ability to rotate to variouswork stations and responsibilities.• Teamwork and a small group approach are encouraged. AtMayo and Optima this may take the form of QualityImprovement Teams, Continuous Improvement Teams, andCorrective Action Teams. Optima also functions withproduction work cells or minifactories. OCG operateswith a number of cross-functional task teams. QualityCircle groups and Kaizen project teams exist at Triad.• Employees are to be rewarded and recognized for theirefforts and contributions to the company. At Mayo, OCG,and Optima, managers have created numerous incentives foremployee excellence. These range from monetary rewardsto T-shirts, mugs and verbal praise.^At Triad,recognition is given to employees for Quality Circleperformance. At OCG (and under consideration at Optima),313rewards are offered for team performance.In all four companies in this study, a substantial commitmentof time and resources has been made in the above areas. Generally,multiple communication systems operate in the JVs, some moreefficiently than others. Significant amounts of energy and expensehave been devoted to training programs for employees, and moststaff in the ventures felt that they have sufficient training toaccomplish their tasks. Systems which promote teamwork areoperating in practice, although at OCG and Triad employeesindicated there has been a reduction in time available to employeesfor team-related meetings due to increased production schedules.Selection procedures for new employees aim to hire individuals withbroad skills, and the ability to operate as team players.Most JV managers take the recognition of employees seriously,and provide many tangible incentives for JV staff. Triad is anexception, where recognition provided to employees is limitedbecause of philosophical preferences on the part of the Japanesemanagers in the plant. In the two unionized plants, Triad andMayo, the creation of positive union relations is thought tocontribute to the effective accomplishment of company strategicobjectives. Both unionized plants have taken steps to encourage aconstructive union-management environment. In addition, themanagement at Mayo Forest Products, OCG, Optima and Triad generallyidentify that the maintenance of a work environment in whichemployees are treated with respect and consideration is important.The mission statement for Plant 1 at Optima outlines that employeeswill be \"treated with dignity and respect\". At Triad, the employeehandbook similarly describes that the company focuses on \"respect314for human dignity\", and is interested in the creation of anenvironment for employees which will result in achievement andself-fulfilment.Although in all the JVs there has been ongoing experimentationwith increased levels of employee involvement, the managers inPlant 1 at Optima are taking the boldest strides to involveworkers. Noteworthy, in the near future associates at Plant 1 willperform many of the tasks currently assigned to management; thisincludes both product and self-management responsibilities. Withinfive years, on-the-job training in the plants will be done bypeers. Associates will develop their own training schedules and dojob evaluations; they will hire and fire peers based on associatecommittee recommendations. Already associates are developing theirown recognition programs. In addition, production workers will dopreliminary quality checks, and they will be responsible forproduct and process innovations using a small team approach, (i.e.Corrective Action teams, Continuous Improvement teams), which isalready operational in the plant. The number of job categories forproduction associates is being reduced to increase flexibility ofmovement between jobs, and to allow cross-training. Promotionswill be based on broad experience.2. Operational Inconsistencies with Stated Strategic ObjectivesAlthough the stated cornerstones of the strategic managementphilosophy in the four joint ventures focuses on communication,education and training, teamwork, and reward and recognition ofemployee performance, as employees in each all four JVs admit,stated strategic objectives are not always implemented in practice.315More specifically:• supervisors may selectively share information withproduction employees in an effort to retain power (Mayo,Optima, Triad)• communication may be less open between subgroups in theorganization (i.e. between Americans and Japanese(Triad); union-management (Triad, Mayo); HR-manufacturing(Triad); or R&D-production (OCG)• an absence of job postings and career information limitsthe employee's knowledge regarding possibilities forfuture career development (unavailable for all staff atTriad and for managers at Mayo and Optima)• limited use of performance appraisal or other forms ofemployee review curtails performance feedback (no PA forall staff at Mayo, or for production associates at Triad)• heavy production schedules may interfere with training(Mayo, OCG, Triad)• although all JVs focus on teamwork, only at OCG arerewards offered for team (versus individual) performance• all JVs are struggling with the creation of recognitionprograms which are meaningful and tied to performance• salaries for production employees are not based onperformance or skills (all four JVs)3. Organizational OutcomesDespite some inconsistency between stated corporate objectivesand the actual implementation of practices, overall, each jointventure in this investigation has achieved many of its goals316related to the integration of HRM and strategic planning. Eachjoint venture excels in the areas of cost, quality and productinnovation. In all four ventures there exists optimism on the partof employees that the company will do well. At Mayo, despite theheavy work load created by the high performance management system,managers feel the additional efforts were worthwhile. Based on jobsatisfaction questionnaires distributed in each venture, employeesindicate a relatively high level of job satisfaction. Employeesare more satisfied with aspects of the job related to autonomy andpersonal fulfilment, than with actual work conditions (i.e. theimplementation of company policy or supervisor competence). Allfour joint ventures are viewed by employees to focus on achievementand production demands. At Mayo and Optima, innovation andcreativity likewise are seen to be priorities in the venture.4. Reinforcing the Mr MissionThe strategic philosophies and objectives for the ventureshave been disseminated to employees in a variety of ways. At Mayo,the JV mission statement is frequently mentioned; it is presentedregularly in the employee newsletter. Symbolism is used to used toindicate Mayo \"is in the race to win\" and \"is going for thecheckered flag\" which appear throughout the newsletter as well.\"Post it\" notes have inscribed the \"team effort\" slogan. At OCGthere is a mission statement unique to the JV, and employees knowof and identify with the company objective to be \"number one in thebusiness\". The vision for the company is communicated to employeesthrough specific presentations on the company strategicorientation. At Optima, the overall company mission statement is317the TQM quality statement, and is therefore not unique to theventure. In this respect, employees do not have a specific,company-relevant slogan with which to identify. However, Plant 1has created its own mission statement, and Plant 2 intends to dothe same in the future. At Optima there is extensive training inemployee involvement concepts and the quality philosophy. Finally,at Triad, mission statements are created at the company,departmental and unit levels. Training reinforces the concepts ofQC and Kaizen, which are central to the accomplishment of strategicobjectives of quality and low cost at Triad. All four jointventures have orientation programs for new production employees; atMayo, Optima and Triad there is some discussion of the company andits objectives; OCG focuses primarily on a safety orientation.5. The Process of Strategic RenewalIn each of the joint ventures in this investigation, thestrategic orientation is changing, rather than static. Morespecifically, at Mayo Forest Products a major reorganization of itssystems occurred in 1988, eight years after the JV formation. Mayois still in the process of implementing changes. In the case ofOCG, the company is new - and it is the product of a merger betweenstaff of the two parent companies. Barely one year old, staff inthe JV are actively creating and changing policies and systems tomeet novel demands in the venture. This process involves theparticipation of both JV and parent employees. Managers at Optimaare taking strides to reshape the manufacturing plants to operateas work cells and minifactories. This change has occurredapproximately fourteen years after the JV was initiated. At Triad,318although now five years into operation, JV staff still aredeveloping new HR and managerial systems. As the management atTriad readily agree, the process of learning and adaptation hasbeen greatly complicated by the active presence of two diversecultural groups in the operation. Both American and Japanesemanagers actively participate in the ongoing policy creationprocess. With the recent change in ownership at Triad, employeesmay expect to experience continuing shifts in management style andphilosophy. Although according to several staff members, theythink few changes in the plant philosophy are likely to occur nowthat Japan Motors is the sole owner.The impetus for reorganization in the ventures has beenlargely initiated and endorsed at the executive levels. However,at multiple levels in the JV, various groups and individuals haveactively contributed to the modifications which have beenundertaken. At Mayo Forest Products, the Vice-President of theCanadian parent and the JV General Manager were responsible for anew direction in the mill. The changes at Mayo were organized inpart by the consulting company, with input from a wide range ofmanagers as well as hourly employees. Most of the reorganizationat OCG has been driven from the executive level of the venture,with considerable operational assistance from the HR Manager forthe JV. At Optima, many recent changes related to employeeinvolvement systems began at the \"grass roots\" level. Themanagement staff in the plants identify the production manager andthe plant manager in Plant 1 as largely responsible. In this case,it was not the executive group in the headquarters office who haveinitiated changes related to the employee involvement system,319although they have continuously endorsed the focus on Total QualityManagement systems. At Triad, most of the systems which are inplace have been organized at the Vice-President level of theventure, with considerable assistance from the HR departmentrelated to the creation of new HR policies for the company. Manyof the modifications to policy and practice at Triad have theirideological base in Japanese management and productionphilosophies, modified to suit an American workforce.6. The Creation of New Roles in the VentureAs a result of strategic reorientation in the venture, theroles of managers and supervisors, production employees, and theunion require reconfiguration. As one manager in Optima describes,the only way in which the JV will be able to meet its operatinggoals is to \"gradually change the culture of the people from onewhere we've not asked them to use their brains much, to do busywork, to one where they feel they own the business\". In all fourJVs, production staff who work in \"high employee involvement\"systems have been asked by management to accept moreresponsibility, to innovate, and offer improvements to theproduction process. Some employees are uncertain whether theyactually want the new role. In addition, some hourly employees aresuspicious that managers will prevent them in practice fromaccepting newly designated responsibilities.This suspicion is supported by a manager at Triad who reportsthat the company had failed to get commitment from some managersrelated to the employee involvement systems. He also notes thatenhancement of these concepts will require the support of upper320level managers, including those in the production areas. Despitethe problem of commitment by some managers, managers andsupervisors in the JVs have generally tried to prove theirintentions related to employee involvement by overt demonstrationsthat \"they mean what they say\". For instance, at Mayo ForestProducts, hourly workers have been taken to Japan to better observecustomer needs and requirements. Employee initiative is givenrecognition by managers, and suggestions are taken seriously andoften put into practice. At Optima, a manager remarked thatemployees are included in supervisory-level meetings, when theywould not have been included previously. At Optima's plants thereare no time clocks and managers say they want to send a deliberatemessage to employees that they are trusted.In Mayo Forest Products and Triad, production employees whoare part of a union are asked to cooperate with management. AtMayo Forest Products one example of how this is accomplished isthrough the inclusion of a union representative on the hiring panelfor new employees. This step was unique for union-managementrelations in the mill, according to both union and management. AtTriad, the relationship with the union is described by managers inthe plant as good, and better than in most other automotiveassembly plants. The implementation of selected Japanese practicesat Triad is aimed to create \"a nonadverserial environment whichpromotes mutual trust and respect\" between managers and unionemployees.Related to a new role for supervisors, there is evidence atMayo Forest Products, Optima and Triad that supervisors haveattempted to retain power through the control of information. For321example, a production worker at Mayo Forest Products observed thatsupervisors did not want to share their knowledge with employees.Further, supervisors were choosing the content of information whichthey distributed. To some extent, the \"hoarding\" of information bysupervisors was a by-product of the history in the plant. Inprevious years the union had considerable power, and the front linesupervisors had little. In the new and refocused system,supervisors are hesitant to relinquish their power gain toemployees in production. At Triad and Optima also, problemspersist with supervisors who were unwilling to share informationwith workers. A manager at Optima observes that \"empowering peopleat lower levels in the organization to make decisions traditionallymade by them [supervisors] is very threatening. Because there's anelement of job security that seems to disappear in that.\" Adepartment head at Optima advises that in order to giveresponsibility to associates, managers need a more \"enabling\" role.He further explains that this is a \"radical\" step for managers andsupervisors. To address the issue of new roles for supervisors atOptima, team training considers power shifts which will occur as aresult of the new orientation occurring in the plant, and a newrole for supervisors in this process. Both associates andsupervisors at Optima receive training in how to work effectivelyin teams.322C. Subgroups in the Joint Ventures1. An Identification of the SubgroupsWithin the joint ventures in this investigation, a variety ofsubgroups exist. These are related to:• minority groups of parent employees who are permanentlymerged into the venture; such as the Ardsley employeeswho were absorbed into OCG from the parent, CIBA-GEIGY• employees who are temporarily transferred to the venturebut who will return to the parent company (i.e. employeestransferred to Optima from Bauer, or to Triad from JapanMotors or Spartica).• groups who differ in philosophical orientations orperspectives; for example, differences were evidentbetween union-management at Mayo and Triad; R&D-manufacturing at OCG; and HR-manufacturing (especially atTriad)2. The Ardsley EmployeesThe most serious concern for managers (especially for the HRmanager) at OCG related to the successful integration of formerlyCIBA-GEIGY employees into the venture. The largest group of CIBA-GEIGY employees to be merged into OCG were the group of employeesin the R&D division at Ardsley. This group of employees is locatedat the parent headquarters offices of CIBA-GEIGY, and as variousmanagers mention, Ardsley employees identify their membership morewith the parent than with the new joint venture to which they nowbelong. The long-term plan is to relocate the Ardsley group to323East Providence, although this would not occur until a couple ofyears following the start-up of the venture due to insufficientspace at the current facility. Ardsley employees who arereassigned to OCG experienced great uncertainty about leaving thesecurity of the large multinational parent company, to join astart-up JV about which they initially know little. For Ardsleyemployees, moving to OCG means not only a physical relocation withtheir families, but also an adjustment to new organizational valuesand processes. Further, to create stability in the JV, theformerly CIBA-GEIGY employees are unable to bid back to the parentfor a period of two years.To best determine the concerns of Ardsley employees, the HRmanager met with members of this group on an individual basis.Further, the HR manager provided information to employees withrespect to changes they may expect as employees of OCG. A taskforce for relocation has been established. As part of theintegration of employees into OCG, an objective for the HRdepartment has been to create fair and consistent policy for all JVemployees, and to implement these policies as quickly as possible.For example, Ardsley employees had considerable uncertainlysurrounding the benefits they are to receive under a new system.In an attempt to remedy this concern, a task force in the JVendeavoured to combine elements of the parent policies which willhave appeal for all JV employees.3. Transferred EmployeesBauer employees who are transferred to Optima retain aseparate status from JV employees, and continue to be retained on324the parent payroll and benefit systems. The parents treattransfers to Optima as if they never left the parent (i.e.seniority, benefits). Although the transfers are made with theintent of sharing technical information, one Bauer employee who isan R&D project staff member at Optima described that his access toinformation from Fiberop has been variable. This individualmentioned that he has not always been provided with informationnecessary to accomplish his task in the venture. Alternately, anengineer in product development transferred to Optima from Bauerfeels that the level of trust and communication between the parentcompanies has improved during the six years he has been in theventure. Employees who transfer to Optima from Bauer for a lengthyperiod of time operate under many of the personnel systems in theventure. Bauer employees at Optima receive an orientation to theJV and quality training, provided by Optima staff. Transferredemployees have access to Optima's training programs generally;performance appraisals for Bauer employees are completed by theirimmediate superior at Optima.At Triad, both American and Japanese managers note thedifferent operating styles and philosophies which exist between thetwo groups. Communication difficulties at Triad have beendescribed by various employees, and to some extent this has beenthe result of different languages spoken by the Americans andJapanese in the plant. Further, American managers describe thatJapan Motor employees are privy to information which they are notalways able to obtain. This is transferred from senior levelJapanese managers in the plant to other Japanese managers andtechnical staff. To some extent, American managers feel excluded325from many of the processes which operate in the plant, during whichdecisions are made. In particular, one manager mentioned that theJapanese managers meet after work, and American managers are notpresent. In some cases, American managers with functionalresponsibility (i.e. in HR) have been bypassed by a Japanesemanager or coordinator, who will instead deal with another Japanesemanager. Similar to Optima, employees transferred from JapanMotors to Triad remain on the parent company payroll and benefitsystems. Japanese managers receive performance appraisals onlyfrom other Japanese managers, regardless of whether they reportdirectly to an American manager.4. Organizational SubunitsIn unionized plants value orientations and work priorities mayvary depending on whether group members belong to either union ormanagement. Differences in perspectives between union andmanagement existed at both Mayo Forest Products and at Triad. Ineach case, measures had been taken to bring the groups closertogether. As already mentioned, at Mayo Forest Products, the unionwas included on a selection panel for new employees. At Triad, acooperative relationship between union and management staff isgradually being built, which stems from each group committing inaction to the requests of the other. The union at Triad agree tooperate the plant based on a quality-oriented and flexiblemanufacturing system. In turn, the management at Triad haveprovided security to employees, and abide by a no layoff policy.At OCG, the HR manager has attempted to bridge differences inperspective, and communication difficulties which exist between the326R&D and manufacturing groups. This \"bridging\" was to beaccomplished through the formation of a cross-departmental teamsand task groups. In addition, exchanges of staff (mostlytechnicians) between R&D and manufacturing was to be initiated.The aim of the exchanges is to share information and to createbetter understanding between the goals of the two groups.Differences exist in operating philosophy between the HR andmanufacturing departments. The first priority of manufacturing isto maintain a high level of production; in turn HR managers notethat their mandate is to create and safeguard positive workconditions for employees. The goals of these two departments aretherefore not necessarily in agreement. Further, as one HR managerin Triad remarks, communication between the HR and manufacturinggroups has been described by various employees as not very open.D. Strategic Human Resource Management1. The Human Resource Management Departmental RoleGenerally the HRM staff in the joint ventures in this researchtried to operate strategically, linking HRM operations with thebusiness plans of the company. However, the form and function ofthe HR role in each venture firm varied considerably. At MayoForest Products, supervisors had the primary responsibility formany of the HR-related activities, (i.e. training, recognition,employee involvement systems). Although the HR manager isfunctionally part of the management team at the mill, much of herrole is related to maintaining a safe work environment, theapplication of the collective bargaining agreement, and ensuring327that \"everything is documented and filed\". As the HR administratormentioned, her role is without power. Neither is it proactive.Policy and decision-making responsibility is not assigned to eitherthe HR administrator on the mill site, or to the HR manager locatedin the regional headquarters office of the parent firm, who wasidentified to work with the salaried employees in the venture.At OCG, the HR manager is strategically involved in thecreation of HR policy for the start-up joint venture. Related tothis, the HR manager plays a significant role in policy creationwhich links HR with the overarching goals for the company.However, somewhat in contrast with this initiative, the HRdepartment is comprised of one individual (for the North Americanoperation), who does not report directly to the President of OCGbut rather to the Vice-President of Finance and Administration.Despite the lack of staff in the HR department, from the earlystages of the venture the HR manager has been involved in policycreation, and has actively solicited ideas from other managers andemployees in this process. For example, various interest groups,including the CIBA-GEIGY employees who are to be merged into theventure were interviewed related to their needs and requirements.The HR manager at OCG has also consulted with HR managers in eachof the parent firms. As a result, HR policy at OCG either has beendrawn substantially from the existing HR policies of the parentcompanies, or alternately has been created to suit the uniquerequirements of the JV. This is in contrast to JVs which drawexclusively from one parent; or as at Triad, where essentially allHR policy has been created to meet the unique needs of the JV.The HR department at Optima is fairly large, with HR staff328located in both of the plants and at the headquarters office. TheVice-President for Personnel holds a central position as a memberof the JV management team, and reports directly to the President ofthe JV. Theoretically, this should ensure a position of relativecredibility for the HR department. However, some of the managersin the venture expressed that HR is not viewed as proactive, andthat HR staff are perceived to function more as \"personnel\"specialists rather than as \"strategic managers of human resources\".In this sense, select managers felt that HR focused more onspecific issues (i.e. benefits), and not enough on the developmentof staff in order to meet future, strategic needs within thecompany. HR managers, along with other managers in the plants aregiven responsibility for the creation HR policy in the plant whichfollows overall JV strategic initiatives.From the earliest days at Triad the HR staff have had anactive role in the creation of new HR policy which is in alignmentwith the business goals of the venture. The development of a largenumber of HR policies in a relatively short period of time hasproven to be an onerous task for HR managers. In general, membersin the HR department expressed that they would have been able toestablish policies earlier, and be more proactive than reactive inthis process, if there were greater numbers of HR staff. Further,early development of HR policy would have contributed to greaterconsistency in the application of HR policy by managers in the JV.As already elaborated, a major focus for HRM at Triad was to blendaspects of American and Japanese management philosophy into HR\"hybrid\" policy which is suitable for an American workforce. Aspart of a policy development process, HR staff built collaboration329with other managers by requesting their input on policies prior toimplementation. Managers in the HR department sometimes found thisprocess to be laborious, and in some instances, (i.e a policy forjob postings), a newly developed policy was rejected after muchpreliminary work. In addition, an HR manager described thatestablished HR procedure may be circumvented by managers in theplant. This has occurred related to promotions, and on occasionJapanese managers have gone directly to the Vice-President of HRMto obtain approvals for staff advancements, rather than to obtainthe approval from the HR manager with responsibility for that area.In select circumstances, although functional authority might beallocated \"in principle\" to a specific HR manager, in reality aJapanese manager may have ultimate decision-making power. Added tothe already complex HR role at Triad, HR managers recognize thattheir department is challenged to keep a \"balance\" between groupsin the plant who operate with differing priorities. In particular,HR staff attempt to maintain an equilibrium between union andmanagement, and between the sometimes divergent priorities of theHR and production departments.2. Communication SystemsA large number and variety of communication systems exist inall the joint ventures in this research. The upper managementgroup in each of the international joint ventures has made acommitment to share information with managers and other employees,and as a result many formal channels for information exchangeoperate. Mayo Forest Products, the smallest JV in the study,probably has the most intensive communication systems, in order to330provide all levels of staff with information on a consistent basis.OCG, with operations on three continents, has special requirementsrelated to the creation of integrated communication networks.Mechanisms for information exchange at OCG are in place, not onlywithin a single location of the JV, but also between the NorthAmerican, European, and Japanese locations. With various sites inthe U.S., the management at Optima have been challenged tointegrate communication systems between the separate plant andbranch locations of the JV. Optima also has manyinterrelationships with Bauer related to the sharing of productinformation. Triad has multiple forms of communication but asmanagers and other employees in the venture note, there have beenongoing difficulties with systems for information exchange. Inpart, this is related to the presence of two distinct cultures andlanguages in the plant.The forms of communication which operate in each JV aresummarized in Appendix 13. An overview of the communicationsmechanisms present in the four JVs in this research highlights aprimary emphasis on face-to-face meetings. In most of the JVs,meetings are scheduled on a regular basis. This included meetingsrelated to: JV boards, the JV advisory committee, daily production,maintenance, departments, crews, safety, QIT, CAT, CIT, task teams,executive planning, focus groups, quality, Quality Circles, Kaizen,and \"world-wide\" meetings in the case of OCG. The exchange oftechnical information occurrs between members (especially in R&D)of the parent companies and the JV. The active sharing ofinformation is viewed by most managers as central to theiroperations. In addition to meetings, information is exchanged331between personnel through the use of fact sheets, memos, bulletinboards and suggestion boxes. Some form of company newsletter andan Employee Handbook was available to staff in all of the JVs. Thetwo largest joint ventures, Triad and Optima, have closed circuittelevision. In all JVs there is extensive use of the telephone.At OCG, every two weeks international teleconferences are held asa way to link managers across three continents. Unique to Optima,much importance is attached to a voice mail system, (for bothmanagers and for the experimental work teams in Plant 1), as a wayto exchange information among busy managers, or across shifts. Tofacilitate communication when multiple languages are in use, Triaduses slides and visual aids (i.e. white boards).3. Reward and Recognitiona) Reward SystemsIn the JVs investigated in this research, salaries aregenerally competitive, compared to other companies in the sameindustry. In all four ventures, employee salaries are the primaryform of compensation, although to a limited extent other rewardincentives are also available. For example, OCG provides awards toindividuals or teams for technological and commercialaccomplishments. In addition, at OCG, financial bonuses areprovided for mid-level managers or higher, although there exist noincentives for hourly workers. OCG is somewhat unique, in thatsome of the employees now designated as JV staff (who were formerlyCIBA-GEIGY employees) are leased to the venture. Salaries andbenefits are paid to these employees by the parent, CIBA-GEIGY,which are then billed back to OCG. At Optima, unit cash awards are332available to salaried staff, primarily on an individual basis.Triad staff, (both salaried and associates), receive an across theboard bonus, which is not tied to performance. As already noted,Japanese management philosophy generally does not support amonetary incentive system. Instead, Kaizen improvements are asource of reward for employees. Under a Kaizen system, processimprovements which often cost the company money, are meant todirectly benefit workers. Despite this, HR staff at Triad areconsidering a revised reward system which ties bonuses andproductivity, and is more likely to meet the expectations ofAmerican workers. In Mayo and OCG salaries for productionemployees are not tied to performance or skills; at Optima pay forskills is under implementation.b) RecognitionMayo Forest Products, OCG and Optima all have multiple formsof recognition available to employees. Recognition may range fromverbal praise, to jackets, shirts, mugs, dinner certificates,luncheons, and \"Employee of Month\", among other forms. Inaddition, in these three ventures recognition is given to employeesfor safety performance, although there is some indication that thispolicy is resulting in no-report of injuries. Related to thepreferences of the Japanese managers at Triad, recognition programsare more limited, although recognition does exist for employeesrelated to achievements in Quality Circles. At Triad, Japanesemanagers especially discourage recognition which focuses onindividual, rather than group accomplishments. In the other JVs inthe study, there is a growing emphasis on team recognition,although to date most recognition tends to be provided on an333individual basis. Some managers at Mayo Forest Products and atOptima suggest that the creation of meaningful recognition programsis one of the most significant challenges of employee involvementsystems.4. Staffing and Promotiona) Hiring Practices in the VenturesAt Mayo Forest Products, a new General Manager was hired bythe Vice-President of the dominant Canadian parent firm, at thetime of the mill reorganization in 1988. The General Manager hadbeen chosen not only for his mill management skills, but alsobecause he was perceived by the Vice-President as able to handlethe politics of balancing the demands of the JV and the parentcompanies. In the months following his appointment, the GeneralManager hired a new team of managers for the mill. Hiring wasinformal, with a focus on bringing in people who were aggressive,self-starters, with diverse skills. The previous background ofcandidates was considered less important than their personalsuitability to match with and support the strategic orientation ofthe mill operation. Staffing requisitions for management staff gothrough the Canadian parent regional office, and then headquartersoffices prior to approval - a system which the General Managerfound cumbersome. Hourly staff are hired by a selection panel,based on union seniority. The ability of production staff tooperate as team players is considered.OCG had minimal requirements for hiring new staff. Ninetypercent of OCG staff were formerly Olin employees; the remainderwere mostly from CIBA-GEIGY. The President of OCG had been an334executive at Olin, and when he joined the venture, members of hismanagement team came with him. Vice-President positions were splitbetween the parents, and were assigned early, before the actualstart-up of the venture. Similar to Mayo Forest Products,interpersonal skills and the ability to work as a team member areimportant characteristics of OCG staff. Managers in the jointventure were considered to have special requirements beyond thoseof managers in wholly owned companies. In particular, JV managersneed an understanding of the JV culture, the parent cultures, andthe interface between them. The importance of \"personal chemistryat the top\" was acknowledged by managers as essential to themaintenance of smooth operations between the JV and parents. Goodcommunication skills, interpersonal relationship skills, andopenness by JV managers to the ideas of the parents was consideredan asset. The HR manager in the JV was perceived to ideally haveinternational, multidisciplinary experience, be adaptable, andpreferably to possess multiple language skills. As new managementand technical staff are required in the venture, hiring will bedone based on a policy of internal recruitment from the parentcompanies. For hourly staff hired in production areas, temporarystaff are recruited to permanent positions.At Optima, the majority of senior managers came from Fiberop.Hiring of new managerial talent is done in a team interview bymanagers with training in behavioral interview techniques. Manynew managers are hired externally, and as one executive remarks, hethinks this contributes to the cultivation of management talentsuited specifically to the company's business needs. In therecruitment process, personal skills, (i.e. communication,335interpersonal, and decision-making skills), are considered moreessential than technical abilities. It is important for managersto gain credibility, not only in the JV, but also in the parentcompany. Openness to new ideas is required. At the same time, JVmanagers must be able to resist pressures placed upon the ventureby the parent firms. Generally, a capable team of managers wasthought to operate in the JV, although as one executive mentionedthis had not always been the case. In earlier times, the JV hadbeen staffed by some overpaid, underutilized staff from Fiberop.This resulted in a policy which still exists, under which transfersto Optima are first approved by the parents. In addition, Bauerhas sent some technical staff to the JV to gain work experience inthe U.S., even if the transfer was not necessary to the operationof the venture. Recruitment of new employees to the plants is donethrough pre-screening by the local employment office, testing onthe GATB, and hiring by a committee of associates who use astandardized interview format. Personal qualities, including theability to work as a team member, are important considerations forprospective associate recruits.Upper management positions at Triad are filled byrepresentatives from the parent companies, as well as by staff whowere hired directly to the venture. Upper level hiring wasprimarily done by Japanese managers, and often included recruitmentinterviews which were held in Japan. Key managerial positions arecounterbalanced between American and Japanese staff. In addition,Triad has a large number of Japanese technical staff transferredfrom Japan Motors, as well as a large production workforce, (i.e.managers, supervisors, and associates). The Japanese managers had336input to the recruitment procedures, and they advocated the use ofimplicit evaluation criteria, rather than objective point ratings.Salaried staff are hired in an interview process by managers whohave received training in interview protocol. Preference is givento Triad internal candidates, and hiring is based more on personaland team skills, than technical background. Managers mentionedthat patience, flexibility, and a willingness of consider otherpoints of view were valued qualities. One manager emphasized theimportance of hiring individuals with bicultural skills in orderthat they may act as \"cultural interpreters\" between the two majorcultural groups in the plant. Women have been able to advance toupper level management positions, although their numbers are few.Associates are hired through an assessment centre; the recruitmentprocess involves standardized testing, a group exercise, and aninterview. Again, personal and team skills are more important thantechnical abilities. The level of education of associates is high,relative to similar production operations. Staffing in theassociate area is generally considered to be \"lean\", and there isa no layoff policy which operates.b) Staff TransfersBoth Optima and Triad make extensive use of employeetransfers. In both JVs, transferred employees remain on thepayroll and benefit systems of the parent companies, the costs ofwhich are billed back to the venture. Transfers enable managerialor technological expertise to be brought into the venture from theparent firms. More specifically, at Optima transfers are used asa means to exchange technical information between the JV and theparents. Most transfers occur between the JV and the German337parent, and generally staff are on assignment for three to fiveyears. Optima staff who are sent to Bauer to learn about newequipment have shorter assignments. Alternately, some Baueremployees in the R&D department at Optima have been on assignmentin the venture for up to six years. Employees transferred fromBauer for a lengthy period of time operate under the personnelsystems established in the venture (i.e. performance appraisal,training). There are no written policies related to employeetransfers at Optima, but despite this, transfer procedures are wellestablished. Employees who are transferred from the parents to theJV are treated as though they have never left the parent, (i.e.benefits and length of service are uninterrupted). In addition,employees who are on assignment in the JV are eligible for many\"perks\", (i.e. Bauer employees receive doubled retirement benefitsfor each year they are on assignment in a foreign country, and theyare reimbursed for a wide variety of relocation expenses). Theparents guarantee a position for transferred employees upon theirreturn. Employees who permanently transfer from the parents toOptima are able to carry over to the JV seniority and benefitsaccrued in the parent company.Basically most transfers to Triad are managers, coordinators,and technical assistants who were sent to the JV by Japan Motors toimplement management and manufacturing practices in the plant. Inaddition, some of the management staff from Spartica had also beenassigned to Triad, but their numbers were relatively few.Assignments are usually three to five years in length. Seniormanagers were designated by the Japanese parent to remain in the JVfor five years. In order to assist transferred Japanese employees338adjust to a new cultural environment, the General AffairsDepartment in the JV arranged for housing, food, schools and otherdomestic details. Transferred Japanese employees to Triad receiveperformance appraisals in the venture, but only from Japanesemanagers. As already mentioned, employees transferred to the JVremain on the payroll and benefit systems of the parent. Incontrast to Optima, however, there are no carry-over policies inplace for Triad employees who wish to permanently transfer to theparent firms, or for employees who want a permanent transfer fromthe parents to the venture. For example, if an employee chooses toleave Triad to move to Spartica, he or she severs ties with the JVand begins again to accrue benefits and seniority in the parentcompany. This policy was intentionally established in order tocreate allegiance to Triad. Similar to the policy at Triad, OCGalso established a policy under which employees could not bid backto the parents for a two year period. This was done in order toensure stability in the newly formed joint venture.At OCG, staff transfers are minimal. In large part this isbecause the necessary technological or managerial expertiserequired for the venture was provided by parent staff who arepermanently reassigned to OCG. In particular, management talentwas largely allocated to the venture by former Olin staff, who arenow OCG employees, rather than from employees on temporary transferfrom the parent firms. In a similar way, R&D talent was added tothe venture from the group at Ardsley, who complement the existingR&D group at the East Providence facility. All the expertiserequired for the new venture was therefore transplanted directlyinto the newly formed JV, making staff transfers of managerial or339technical assistance less necessary. Alternately, at Mayo the milloperation is well established. Very few transfers from the parentsexisted, although the production and sales coordinator is a CPFPemployee. There had been greater involvement by Mitsubishi in thestart-up phase of the mill, but Japanese involvement diminishedover time as the operation stabalized.c) Career Pathing and PromotionsThe absence of job postings to inform employees of futureavailable positions, and lack of other career-related information,are contentious issues for employees in this investigation.Generally, despite strategic goals in the JVs to develop staff forfuture requirements, this was done poorly, if at all. As a result,many employees are frustrated by not having the opportunity toapply for jobs for which they felt qualified. A large number ofemployees think promotional systems in the JV are unfair. Tosummarize the systems related to career advancement as theyoperated in this research, Mayo Forest Products has mandatory jobpostings and promotions based on seniority for union employeesbased on the collective agreement. No job postings exist forsalaried staff; and career path information is not readilyavailable. At OCG there are job postings for hourly and salariedstaff in Olin, but not in CIBA-GEIGY, related to hiring new peopleto the venture. This arrangement reflects a perception that thereis a greater likelihood of hiring people with the requiredexpertise to the JV from Olin. However, a CIBA-GEIGY executivefelt job postings should be circulated in both parent firms.Career path information and job postings exist at Optima, butmostly for administrative and technical staff, and lower level340supervisory positions. Staff in the HR department have consideredan expansion of the career planning program for managers and seniorsupervisory employees. Job postings do not exist for upper levelmanagement positions; instead a \"people review\" is done by seniormanagers and promotions are made accordingly. At Triad, there areno job postings or career path information available for employeesat any level. Subsequently, employees complain that they don'tknow which positions are available, or how promotions occur withinthe company.5. Training and Developmenta) Variety in Training ProgramsAt Mayo Forest Products, OCG, Optima and Triad there is astrong commitment to training employees at all levels in theorganization. Training for salaried staff (i.e. supervisors,managers) in all the JVs is wide-based and generally available. Tosummarize, at Mayo Forest Products salaried employees receivetraining in technical, supervisory and interpersonal skills. OCGprovides TQM training, teamwork, interpersonal skills, andsupervisory training. Optima provides training in interpersonalskills, communications, technical areas and quality management tosalaried staff. At Triad, staff have received training in Japanesemanagement and production methods, performance appraisal,computers, project management, as well as supervisory training.This is not an exhaustive list of all training provided in eachventure, but rather highlights the variety of training which isoffered to supervisory and management staff.Managers in all JVs stressed the importance of training to341enhance employee teamwork and production quality. Training forhourly workers is mostly on-the-job, but in addition, otherspecific opportunities for training related to the job are offered.At Mayo Forest Products considerable time, energy and expense havebeen devoted to the creation of a competency based on-the-jobtraining program for hourly workers. Comprehensive trainingmanuals for each job station were developed by equipment operatorsand an outside consultant. To become qualified for a job, hourlyemployees complete a written test, a performance test, and thenundergo a qualifying period when a skills checklist is used toensure the job has been adequately learned. This system is new andis not yet applied consistently. In addition, hourly workers atMayo Forest Products are eligible for classroom training inspecific, job-related areas. Employees who attend a course in howto grade and cut quality lumber are paid time and a half to attendthe classes. Training for hourly employees at OCG is on-the-job,and there is a manual of standard operating procedures for all jobsin the plant. When learning a new job, a skills checklist iscompleted by employees and supervisors to guarantee the job hasbeen learned properly. Little additional training is offered toproduction employees at OCG. Hourly employees at Optima receivetraining from other production employees who have taken \"Train theTrainer\" programs. Cross-training and training related toeffective team participation are offered to production staff.Teams determine training schedules for their own groups. At Triad,as well, training for hourly staff is mostly on-the-job, althoughsome trades training in the classroom is also offered. Trainingwhich is provided in the plant to production staff emphasizes342Japanese manufacturing methods. Job rotation and cross-traininghave been implemented to create flexibility in the manufacturingoperation.b) Sources for TrainingMuch of the training which occurs in the ventures is offeredinternally (i.e. by parent or JV staff), especially for productionemployees. Salaried staff are more likely to receive off-sitetraining provided by external sources. At Mayo and Optima,managers and supervisors have attended training programs providedby consultants. OCG employees receive training primarily throughthe Olin training facility.At Triad, in order to teach American production workers aboutJapanese management philosophy and production methods, largenumbers of coordinators and technical assistants were transferredfrom Japan Motors to provide training. In addition, upper levelstaff at Triad who are American, went to Japan to receive relevanttraining. Quality circle training, which is an important componentof training for production associates, is provided by an Americanwho spent considerable time in Japan learning QC methods. Althoughtraining is also provided at Triad from external sources, atpresent this is fairly limited. The training department consistsof one individual who is responsible for the coordination ofoutside training programs.c) Cultural TrainingRelated to cultural training, at Mayo Forest Products, a five-year training plan is under development, and may include courses inthe Japanese market, culture, and Japanese certification standards,in order that employees can better understand the requirements of343their Japanese customers. OCG does not offer cultural training.At Optima, a course in German language was offered, although fewemployees attended. For employees who are transferred from Optimato Germany for a period of several years, they are eligible for acourse which provides information about German culture, history,and politics. Eight hours of cultural training, (i.e. Japanesecustoms, culture, business practices, language), originally wasoffered to Triad employees, although this program no longeroperates.d) Job Rotation in Production FacilitiesJob rotation is a system in which employees rotate to variousjobs in order to gain broad skills. The benefit to the employee isgreater job variety and less potential for boredom as the result ofrepetitive job assignments; the benefit to the company is greaterflexibility in the manufacturing process. In the JVs in thisstudy, job rotation does not operate at Mayo Forest Products, isused minimally at OCG, operates primarily in the experimental workteams in the plants at Optima, (although this was to be expanded in1992), and is used extensively at Triad. Although as someassociates at Triad point out, job rotation did not always operateas designated, and some associates are given preferential treatmentby supervisors.6. Performance AppraisalOf all HRM activities, the area of performance reviewgenerally receives the least attention by JV managers in thisstudy. At Mayo Forest Products, essentially no performanceappraisal (PA) process operates for either hourly or salaried344staff. OCG has a \"Performance Management Process\" in operationwhich is a system adopted from Olin. The purpose of this system isto link employee performance with the total quality program.Employee progress is monitored related to meeting customerexpectations, and is based on both team and individual goals.Employees have input to the reviews, and technical as well asinterpersonal skills are considered. There is a developmentalcomponent which focuses on career objectives or trainingrequirements for employees. All employees at OCG receive aperformance review, although the implementation of this process isnot consistent within the company. At Optima, performance reviewsfor salaried employees are based on an MBO-type system in which theemployee and immediate supervisor jointly set performance goals.There is a developmental component, under which employeeperformance is reviewed related to requirements for future job fitsin the company. Managers are given training in how to conductappraisals, and guidelines exist for both managers and employees inorder that the process is completed successfully. Hourly employeesin the plants also receive performance reviews based on both workperformance and personal traits; at the time of the review,employee objectives are set for the coming year. In the future,peer reviews for production associates are expected to operate inthe plants. To ensure the completion of performance reviews forall staff, merit increases are only processed once the PA has beenreceived by the personnel department. A PA system exists at Triadfor salaried staff, but not for associates. The process focuses onboth the accomplishment of performance goals and personal skills,and the PA is used primarily to determine salary increases.345Considerable thought and preparation was devoted by HR staff tocreate a PA system which was compatible to the requirements ofJapanese managers in the plant. To facilitate the implementationof the performance reviews, training was provided to Japanesemanagers as to how to complete the process. Despite this, thereare ongoing difficulties for the Japanese in the use of a systemwith which they are neither entirely comfortable nor familiar.E. The QuestionnairesData accumulated from the questionnaires distributed as partof this project broadens the scope of information collected fromemployee interviews and documents. The questionnaire data indicatehow employees in each venture perceive the company to operate. Ingeneral, the results from the questionnaires are consistent withother sources of data, and lend numerical support to some of thefindings. Although the questionnaire results are not meant togeneralize to other companies, there are implications that can bedrawn from this data.1. Guide to Human Resource Management PracticesInformation gathered on the Guide to HRM Practices wasgenerally consistent with other data related to HR policy andprocedures as they operated in the JVs. There was considerableevidence of dual values operating in the HR systems. For example,at OCG the HR manager indicates that planning is both formal andordered, as well as informal and flexible. Planning considers bothindividual and group components; incentives are both short-term andlong-term. In ventures where more than one HR staff member346completed the inventory, there was internal consistency among therespondents. The exception was at Triad, where differences incultural perspectives between Japanese and American HR managersfigured prominently in how HR policy and practice was seen tooperate. For the American and Japanese managers who completed theHRM inventory, operating differences were perceived to existrelated to the length of time frames which operated in the plant,(i.e. long-term or short-term), whether a group or individualphilosophy existed, the amount of employee involvement, and whetherevaluation is based on the total person or on performance only.2. Minnesota Satisfaction QuestionnaireOverall scores on the Minnesota Satisfaction Questionnaire(MSQ) in all four JVs in this research are relatively high foremployee job satisfaction. Job satisfaction related to intrinsicsources of satisfaction is higher than scores for extrinsicsatisfaction in all companies. Generally, intrinsic jobsatisfaction resulted when employees experienced autonomy andvariety on the job. This relates more specifically to employeeswho are able to keep busy, to use their ability and judgment, andwho have the chance to work independently. Employees in all JVsindicated strong agreement that their jobs provide steadyemployment.Scores for extrinsic satisfaction were consistently quite lowin all companies. For example, this relates to the way companypolicies are put into practice, and the low availability of praisefor high standards of work performance. This finding is consistentwith some interviews in which employees state they rarely receive347feedback from supervisors on how they are doing. It iscontradictory, however, to the stated emphasis in all four JVsrelated to reward and recognition for employee accomplishments.Also related to extrinsic satisfaction, employees perceived thecompetence of supervisors to be quite low, except at Optima whereemployees scored relatively high on how the \"boss handles people\".At Triad, there is consistency on a wide range of items between theresults of the MSQ and an earlier survey on occupationalpreferences completed by researchers from two local universities in1989. The only exception is in the area of employee satisfactionwith supervisors' performance, which is lower now than in the 1989survey. Related to extrinsic satisfaction, employees at MayoForest Products, OCG, and Optima indicate that they are moderatelysatisfied with salaries with respect to work demands; employees atTriad were highly satisfied with this feature of the company. n1all four JVs, the chance for advancement was not perceived byemployees as especially high, except at Mayo Forest Products.3. The Culture InventoryBased on the questionnaire scores, employees in all four jointventures view the organizations as having a predominantly rationalculture in which there is a focus on achievement, goal and taskaccomplishment, and production. At both Mayo and Optima, arational culture is considered most predominant, but employees alsoindicate there exists a developmental culture in the JV as well.In this regard, the production focus is coupled with an emphasis oninnovation, creativity, growth and dynamism. At OCG, employeeslikewise view the company as having a rational-developmental348culture, although the developmental component is weaker than atMayo and Optima. Triad employees indicate that a rational cultureexists in the JV, with a secondary influence of a hierarchicalculture. In this instance, a focus on achievement and productionis coupled with some emphasis on rules, order, and formality. Inall the joint ventures in this investigation, evidence of a groupculture was weakest. This indicates that employees feel there isminimal emphasis on people, loyalty, tradition and human resources.349PART FOUR: THE ISSUES - A DISCUSSION IntroductionThe preceding sections have outlined strategic HRM practicesand processes as they operate in the four joint venture firms inthis investigation. Based on this information, the followingsections consider the implications for the research based on thedata and the analyses of the data. Issues related to strategic HRMemerge as a result of the project, and these are elaborated.Further, strategic HRM is considered related to corporate culture,organizational learning, and national culture in internationaljoint ventures. Bolded text at the beginning of each subsectionserves to frame key issues related to the JV cases and relevantliterature. These statements or propositions underlie comparisonsacross the four joint ventures in this study.CHAPTER NINESTRATEGIC HUMAN RESOURCE MANAGEMENTA. Management of the JV-Parent Relationship1. Parent Goals and Strategic HRMIn the value-added JVs, both parents tend to activelycontribute to technological outcomes in the venture; inthe specialization JVs, parent input is more one-sided,with minimal involvement from the nondominant parentfirm. Depending on the strategic goals of the parents,HRM policy and practice differs, especially as it relatesto the transfer of technology.350In the four joint ventures in this project, Mayo and Triad arespecialization JVs; OCG and Optima are value-added. Related tothis, in the value-added ventures there tends to be a more sharedrole between the parents. Although one parent was assigned themanagement contract at OCG and Optima, both parents are involved intransferring technological expertise to the ventures. In contrast,Mayo and Triad are shared JVs, but more dominant in character. Theparent with the management contract in each case takes the lead inproviding administrative and technological expertise to theventure. This is the case at Mayo Forest Products. At Triad,there is some involvement by Spartica, but this is very minimal.Alternately, Japan Motors provides influence and expertise to theJV through numerous staff assignments to the venture, and transfersof Triad staff to Japan, in order that information and technologyrelated to Japan Motors management and manufacturing style can betransferred to the venture.Depending on the parent goals for the venture as identifiedabove, the way in which HRM is structured to complement the parentobjectives differs in each case. For example, at Mayo the\"subsidiary\" type operation has no specific requirements for thetransfer of staff between the JV and the parents. Although infact, if job rotation were to be implemented in the mill as oneproduction employee described as desirable, there may be benefit inJV managers and other employees visiting the Mitsubishi operationsin Japan in order to view this process first hand. Likewise, thereare no particular requirements to link other HRM activities such astraining or staffing with those of either parent in order totransfer technical or other expertise to the JV. Communication351networks with either parent are relatively limited, howevercommunication is retained with the CPFP parent, and with bothparents through the JV board and advisory committee.At Triad, where the Japanese parent is dominant, a network ofHRM-related processes operates in order to accomplish parent goalsand objectives. This takes many forms. For example, in the areaof staffing, the placement of transferred Japanese executives inthe JV is counterbalanced with senior-level American managers.Although the Japan Motors executives have primary influence in theoperation, one might consider this arrangement to provide asemblance of shared power in the American-based operation. This islikely to be important if Spartica managers on the site, and Triadmanagers, are to feel they have a role to play in the venture.Alternately, the result might be an abdication of responsibility byAmerican managers who feel Japan Motors executives make thedecisions. To some extent, American managers at Triad did perceivethe Japan Motors executives to dominate in the operation,regardless of the effort to balance executive staffing. This isdemonstrated by one manager who mentions that all the Japanesemanagers and technical assistants are \"dialed in\" before theAmerican managers. Japanese employees in the plant get informationahead of their American counterparts, and are more likely to shareinformation from the Japanese parent with other Japanese managers.Although there is no evidence of exactly why many Spartica managersleft the plant earlier than planned, this may relate to a sense ofpowerlessness to contribute, or a perceived redundancy of rolesgiven the predominance of the Japanese in the plant. In futureresearch, questions related to how the involvement of dominant352parent managers is perceived by managers of the less dominantventure partner, and how this affects the performance of thenondominant parent group, would be interesting to consider.Further, staffing of both associates and managers at Triadfocused on obtaining employees who could contribute to theenvironment Japan Motors hoped to create in the plant. This meantextensive selection procedures for associates, and a requirement ofbroad skills for all staff. On the production floor, well educatedemployees with multiple skills are selected to better participatein the flexible manufacturing operation, where cross-functionalcapabilities of employees are expected. The HR manager wasselected by Japan Motors executives in Japan, because he wascommitted to the same goals as the Japanese parent, including aconstructive union-management relationship. To meet the qualitygoals required by the Japan Motors, extensive training wasnecessary. As already described, this took the form of transfersof American staff to Japan, or of Japanese managers and technicalassistants to Triad to provide direction, training and otherexpertise related to both management and manufacturing methods.Equally important, Japan Motors seeks to reduce costs.Subsequently, Kaizen and Quality Circles are both importantemployee activities related to continuous improvements to meet thegoals of cost control and efficiency in the plant.At both OCG and Optima, the primary goals of the parents andthe venture are to achieve product innovation and quality based oncomplementary parent expertise. To accomplish these objectives,technology sharing between the parents is a priority for eachventure. This is accomplished through strategic HRM initiatives.353At OCG, staffing of senior Vice-Presidents represents both parentfirms. In addition, the biggest issue for the venture, thetransfer of the Ardsley group into the JV, was initiated to acquireR&D expertise of the CIBA-GEIGY parent. This necessitated avariety of new HR policies related to relocation and benefits. Theno-bid back to the parents was instituted to retain thetechnological talent in OCG until the JV had stabilized. Many ofthe goals of both parents related to innovation and quality wereaccomplished through the adoption of Olin's Total QualityManagement program, and the Performance Management Process foremployee performance evaluation. To provide greater incentives toemployees to contribute technological accomplishments at OCG, thereward and recognition systems are under revision.Intercontinental communication systems were initiated to shareinformation and technology among JV and parent groups.At Optima, product innovation and quality are facilitated bynumerous transfers and permanent staff relocations between the JVand the parents. Many of the senior executives in the productionarea at Optima were relocated from Fiberop, and brought knowledgerelated to optical fibres with them. Cable expertise is introducedto Optima through numerous transfers between the JV and the Germanparent. In the latter instance, technology is transferred by Baueremployees who are temporarily relocated to Optima in the R&Ddivision. The HR department provides assistance in transfers. Theparent goals of quality enhancement are encouraged in trainingprograms, by the employee performance review process, and by rewardand recognition programs for innovative technical accomplishments.In the plants, the redirection toward self-managing work teams is354not only likely to be more positive for employees, but there is theadded benefit of cost reduction and product improvement related toa more flexible manufacturing operation where employees cross-train, have broader skills, and are more willing to volunteerproduct and system improvements.2. Partner CompatibilityIf the JV partners lack well aligned strategic intents,then long-term venture success may be more tenuous.As Lorange and Roos (1991) suggest, the strategic match of thepartners is critical. The parties to the venture not only mustcomplement each other, but it is important that they don't infringeon each other's territory. It helps if there is culturalsimilarity. Related to these considerations, if the parents are toachieve optimal realization of their goals, then one might expectthe parent goals to be in close alignment. At Mayo, OCG andOptima, the parents have basically the same direction andphilosophy for how the JV can best achieve the strategic mandate asoutlined by the parent firms. Managers in the joint venturecontribute to this process, as do the JV management board.At Triad, however, the corporate philosophy and strategicobjectives of Japan Motors and Spartica are not in completeharmony. The parents operate their own automobile plantsdifferently from one another. One Triad manager describes, \"theAmericans are going to support their corporate culture...and theJapanese want to support their corporate culture or their beliefsof how they think Triad should be run\". Japan Motors has a similarorientation to the other parent companies in this investigation355related to quality and employee involvement; Spartica hastraditionally not focused on either quality management or employeeinvolvement to the same extent. Related to this, part of thereason for Spartica involvement at Triad was to gain exposure tothe manufacturing methods and management style of the Japanesepartner. As already described, this goal did not materialize tothe degree Spartica management had originally hoped. Many of thelimiting the amountSpartica managers returned early to the parent,of learning for the parent firm.In addition, Spartica had a market conflict with Triad, inthat one of its own models was in competition with a new modelproduced by the JV. Related to these concerns, Spartica decided towithdraw from the venture. The American parent experienced seriousfinancial difficulties at this time, and one might speculate didnot feel there were sufficient gains to be made by remaining in theJV. Although, the joint venture was dissolved, this does notindicate in any way that the Triad was unsuccessful. Triadcontinues to thrive under the leadership of the Japanese parent,and the many Triad managers who have helped realize the corporatevision of high quality and low costs.3. Relationship ManagementThe effective management of relationships, both in the JVand between the JV and parents, appears to be animportant factor to JV success. Exemplary personalskills are an asset in staff at all levels.In all of the joint ventures, personal skills and an abilityfor managers to facilitate good relationships between the parents356and the JV, and within the JV were considered important. Thisimplies that HR managers and other managers are aware of thepriorities of various stakeholder groups. As already noted, thereare a number of subgroups which operate in each venture. Thesegroups include for example, union-management, R&D and production,transferred employees to the JV, or diverse cultural groups as atTriad. In addition, managers located in the parent firms, ormembers of the JV board may also have a stake in how the JVoperates.Managers are most likely to be successful in meeting theexpectations of these various groups if they first know the group'srequirements. Such information can be obtained, for example,through open communication channels, and in relationships wheremutual support is built (Kanter, 1983). In each of the jointventures in this investigation, these tasks were accomplished indifferent ways. For example, at Mayo Forest Products, theinclusion of a union representative on the selection committee wasa beginning step to include the union in the mill operation. AtOCG, the HR manager first determined the needs of the Ardsleygroup, and defined the differences which existed between R&D andproduction before the development of new HR-related policy to meetthe respective concerns in each group. At Optima, managers weretaking pains to demonstrate to production employees that they\"meant what they said\" about new norms of greater employeeinvolvement at the plants. At Triad, some managers in the HRdepartment saw themselves in a balancing role between variousgroups in the plant (i.e. union-management, Japanese-American). AtTriad, new HR policy was created only after consultation with357American and Japanese managers. In all joint ventures, a focus oncommunication encouraged various groups to express concerns, oroffer suggestions. In these ways managers both become morefamiliar with issues of importance to employees and to their peers,and are able to offer acceptable solutions to problems when theyarise.In the relationship between JV managers and members in theparent firms, the General Manager at Mayo Forest Products mentionsthe development of trust between the JV and the Japanese partnerwas important. He states,I would always wear the Mayo hat and was always verydirect with them [the Mitsubishi representatives].Always very up front with them and very consistent. Iwas never deceitful, never lied. Always went at themwith the same story. And we [the JV staff] got theresults.At OCG, a manager notes that when you are working with peoplefrom different backgrounds and approaches in the parent firms, itis critical to understand different styles and motivations. Headds that in joint ventures, a manager needs \"to maximize what youcan do yourself and what you have your parents do for you. So yourmanagers who will be successful, I think have to understand theirown culture, both parent cultures, and where they can make use ofthem\". To elaborate on this theme, managers need broad knowledgeof all strategic players linked to the venture, as well as thedynamics of how tasks might be accomplished. Similarly, at Optimaone manager notes that credibility is important, and havingsufficient business knowledge to ask appropriate questions ofmembers of both parents, as well as of the JV operations staff.Finally, at Triad many managers mentioned the importance of being358able to bridge cross-cultural differences through enhancedknowledge and communication. In all the ventures, theestablishment of personal relationships between senior executivesin the parents and in the JV contributed to development of informalchannels of communication through which information might beexchanged and tasks accomplished.In these descriptions by JV managers of how the venture-parentrelationship might operate, the establishment of trust andcredibility, as well as an understanding of the operating stylesand motivations of various groups is mentioned. Despite this, innone of the joint ventures in this study did managers eitherrequest, or were provided with, training or information whichfocused on how interorganizational aspects of the JV-parentrelationship might best be managed. Given the importance manymanagers attach to the development of personal relationships withmanagers in the partner companies, joint training sessions whichinclude members of both the JV and the parents, are likely tofacilitate not only relationship building, but also exchangesrelated to key issues, concerns, or new ideas. In JVs when parentgroups are from diverse cultures, cross-cultural understandingmight also feasibly be enhanced.4. Implications of the Management ContractThe parent with the management contract can significantlyinfuse the JV operation with its own strategy andmaterials. The second parent may likewise have importantofferings to the JV, and therefore careful planningconsideration is warranted in the early stages of the JV359as to how both parents might contribute to the venture.Three of the joint ventures in this investigation share 50/50ownership between the parents, and have an equally shared JV boardstructure. Mayo is the exception, with a 60/40 equity split infavor of CPFP, and an extra CPFP member on the JV board. However,in all four joint ventures, one parent was given responsibility formanagement in the venture by virtue of the assignment of themanagement contract. This allocation of responsibility was decidedearly in the JV formation, except at Mayo where the managementcontract was assigned to CPFP at the time of the reorganization in1988. In all instances, the parent with the management contracthas drawn on its own resources in the management of the venture.For example, at Mayo Forest Products this has included use of thesame consulting company as CPFP to set the pace for thereorganization plan in the mill. HR policies for salaried staff atMayo are adopted from CPFP. At OCG, the HR manager who is from theparent, draws on Olin resources (including TQM, HR policies, andthe Olin training facility). Optima uses Fiberop's TQM program andhas adopted many HR policies from the American parent. At Triad,management practices are derived from Japan Motors adapted to suitAmericans.In these ways the JV may be either unintentionally ordeliberately infused with the values and strategic initiatives ofthe managing parent firm. As Frayne and Geringer (1989) speculate,the extent of overall parent involvement in the venture related tothe placement, quality and number of staff; training content; formof performance appraisal; or type of compensation and reward areexpected to affect the JV corporate culture and identity. How this360occurs is elaborated in later sections. In addition, the contentand type of communication systems which operate in the JV, andbetween the JV and the parents, are related to the degree to whichemployees of the joint venture form an affiliation to the venturecompany as opposed to either of the parent firms. In this sense,and related to strategic HRM objectives, the parents need to decidethe level of JV autonomy versus dependence on parent policy whichis desirable in order for the JV to flourish. For example, thereis a trade-off between an infusion of readily available managementservices into the venture, and the creation of innovative HR policyunique to the special needs of the JV. At OCG which aims to beentrepreneurial, a simple adoption of policy from either largerparent firm is likely to be inappropriate to the demands of themuch faster paced market in which OCG competes.To elaborate on this point, the parents have ready-made,usually high-quality materials and programs to which JV managementcan have access. This is especially useful in the start-up phaseof an operation when the creation of a multitude of new policiesand processes is required. The development of new systems islikely to demand considerable staff time and energy. Further,there is a cost savings. HR departments in the JVs in thisresearch were generally small, with a limited number of staff. Itis less expensive if HR staff in the JV can draw on already createdparent policies. The alternative is for a greater number of HR andadministrative support staff to be employed in the venture, whenlarge numbers of new HR policies are to be developed. However, ifthere is an overreliance of parent materials and systems in the JV,the possibility exists that the venture may inappropriately mirror361the parent culture, with little focus on unique JV requirements.Further, if the joint venture is structured to be qualitativelydifferent from the parents, i.e. to be entrepreneurial (as at OCG)rather than large and bureaucratic (as tends to be the case in theparent corporations), then a simple adoption of the same strategiesand HR policies as the parent, is unlikely to meet the specificdemands of the venture.Although to some extent, it is easier to coordinate thestrategic and HR processes in the venture if one parent is theprimary source of input, this assumes that the second parent haslittle to offer to the JV in terms of HRM or strategic policy. Forexample, in the early stages of the JV negotiations at OCG,management responsibility for the venture was clearly designated toOlin. In part this was done because the majority of staff assignedto the venture were former employees of the Olin operations.However, because the management contract was awarded to Olin, CIBA-GEIGY personnel had budgeted neither time nor resources tocontribute HR expertise to the venture. This was problematic forat least one senior executive at CIBA-GEIGY, who felt that theSwiss parent had insufficient strategic and HR input to OCG. Morespecifically, the HR manager for OCG and the CIBA-GEIGY executivesrecognized that the Swiss parent excelled in recognition policiesfor employees. The contribution by CIBA-GEIGY in this and other HRareas might be enhanced in a situation where that parent's inputwas part of the JV mandate. If such exchanges of expertise do notoccur as a result of unilateral assignment of the managementcontract, then opportunities for administrative learning in theventure are reduced.362Related to assignment of the management contract, it maytherefore be advantageous to consider how the expertise of managersin the parent firm not assigned the management contract, might alsocontribute to the venture. If the second parent in fact chooses tobe involved in the JV, then participation could be structured bythe formation of joint task forces in the HR area (as is alreadydone at OCG). In addition, allocation of funds to the secondparent for its contributions, or temporary assignment of personnelfrom the second parent to the JV, may contribute long-term benefitsto the venture. In this way, the parent who has not officiallybeen assigned the management contract for the JV, neither abdicatesresponsibility related to providing expertise to the JV, nor feelsuninvited if contributions are offered.To date, research has not examined under which conditionsjoint venture partners decide who has the management contract forthe venture, and why. Given the potential influence the managingparent has on the JV operations, the factors which underlie theassignment of the management contract to a parent firm deservefurther attention. In three of the four JVs in this investigation,the contract was assigned to the parents with headquarters in thesame country in which the JV is located. Alternately, at Triad,Japan Motors took the lead in the venture because both parentsbelieved they could best provide relevant manufacturing andmanagement capability.3635. Parameters for Joint Venture AutonomyAlthough at a strategic level, many JV goals andobjectives are directed by the parent firms, at theoperations level JV managers are generally givenindependence as to how to run the operation to meet thosegoals.Joint venture managers in this investigation seemed to thinkthat the level of autonomy given the JV was related to the successof the JV in meeting parent expectations. In support of thisassumption, Killing (1983) notes that if the joint venture isoperating in a manner considered successful by members of theparent firms, then JV managers are given relative independence.Killing concluded that autonomy in the venture both results fromgood performance, and leads to improved performance. In thisresearch, it would appear that each of the joint ventures wasjudged successful by the parents related to established performanceobjectives, and was given relative autonomy as a consequence.Managers in various departments of each JV did not take thefact of independence from the parents for granted. This isexemplified by a senior HR executive at Optima who remarked thatone of the major challenges for the HR department was to maintainexcellence in the department in order to avoid intervention fromthe parents. This manager states,In the area of personnel and people, I want to keep ourcompany as good as it can be. I feel that if I do not,that I could have some intervention from my parents. Soif I think about that as a challenge, and I think if youtalked to our financial people, they would tell you thesame thing.Further, a plant manager at Optima notes that despite welcomed364assistance provided by the parent companies, that the JV strivesfor autonomy. He adds, \"I don't ever remember it being writtendown, but the sense you got being here was that it was theintention that we would strive to be autonomous. And that was thedirection we headed\". At Triad, where there has been considerableinfluence from the Japanese during the first five years of theoperation of the venture, one Japanese manager hints that it may betime for Triad to create a more autonomous identity. This Japanesemanager suggests that now most employees at Triad understand \"theJapanese way of business, Japanese thought, and the Japanese way ofproduction. And in time, they have to realize and to decide tothink their own way; the Triad way they have to create\". TheGeneral Manager at Mayo Forest Products was told by the CPFPexecutive most involved in the JV to manage his business unit andmake changes as required at the operations level. At OCG, althoughthe venture is new, the upper management team felt they were givenrelative independence directly linked to the successes of the JV todate. As mentioned in an earlier section, the ability of JVmanagers to effectively interface with the parents is important.The development of trust between the JV and the parents contributedto the independence of the ventures.365B. Integration of HRM and Strategic Planning1. HRM Technique and ProcessHR managers appear able to deal with the technical issuesof creating new HR policy; the more difficult task isthe implementation of process-related HRM.HR managers as well as other managers and employees in theventures contributed to the development and enactment of variousHRM systems. In all joint ventures is it interesting that many ofthe difficulties related to the creation of appropriate HRM systemswere not technical in nature. In each JV, various HRM policieswere established with minimal difficulty, either drawing on parentresources, or newly created for the venture. Of course somedifficulties were technical, such as a lack of job postings, or anabsence of any performance appraisal system. However, even atTriad, where the development of \"hybrid\" policy presents asignificant challenge for managers, HR policy related to staffingand training were readily created. The more difficult issues inall of the joint ventures instead were related to the successfulimplementation of strategic HRM processes. For example, thisconcerned how to create effective communication systems at Triad inthe presence of diverse cultural groups; how to implement aperformance appraisal system at Triad when Japanese managers resistthe format; how to effectively deal with changing roles formanagers and production workers in all four ventures; or how tobest integrate parent employees into the ventures. Based on theseconsiderations, one might expect managers to require diverse skillsif they are to function as \"process experts\" in complex366organizations.2. The HR Departmental Rolea) The Process ExpertsHR staff are most effective as process facilitators ifthey possess personal, technical and political skills.HR managers in this study required multiple skills if theywere to function effectively in their roles, and gain thecredibility and confidence of other staff. In general, managersmentioned the importance of personal skills such as openness andflexibility to new ideas or other perspectives, and tolerance andpatience. Technical skills were likewise required. Senior HRmanagers at OCG, Optima and Triad all have many years of experienceworking in the HR area. In all of the ventures, HR managers havea thorough knowledge of HR-related policy. Further, HR managersmentioned that political skills related to the management ofrelationships with a variety of stakeholders in the JV and parentorganizations are beneficial. More specifically, at Triad, HRmanagers noted the importance of balancing priorities betweengroups, and the benefits of advance knowledge and information aboutthe groups' concerns and preferences. In another example, at OCG,the HR manager recognized the importance of gaining support fromthe parents and parent employees assigned to the JV as part of aprocess to develop new HR policy.The role of HR managers as process experts suggests anexpanded position for the HR department in the organization. Tosome extent, this is an idealized role, and not attainable in allcompanies. However, related to this expanded role, Cyr and Frost367(1992) outline a role for HRM which might include: a knowledge ofcompany strategic goals and objectives in order that HRM policy andpractices are in alignment with these goals; the creation anddissemination of a clear vision for HRM at the organizational andHR departmental level; and an appreciation of how cultural valuesand assumptions impact employees and the organization. Related tothe above considerations, and with a focus on HRM in jointventures, these and other issues are discussed in the followingsections with respect to how HR managers operated, or might haveoperated to accomplish their objectives at Mayo Forest Products,OCG, Optima and Triad.b) Early InvolvementEarly involvement by HR managers in the JV operationtends to ensure a central and strategic position for HRMon the longer term.At OCG, Optima and Triad, where the HR department has asignificant role in the creation of HR policy for the venture,involvement by HR staff began in the early stages of planning forthe JV, before the plants were operational. For example, at Triadthe HR manager was one of the first staff members hired to the JV,and he spent considerable time in Japan determining HR objectivesfor the JV, in conjunction with Japan Motors executives. Alongwith other staff, the HR manager began to establish HR procedureswell in advance of production start-up in the plant. The advantageof early involvement by the HR department helps to ensure that theHR group is aware of parent strategic initiatives and is able totranslate JV objectives into appropriate HRM systems in theventure. Related to this, if the HR department is able to take the368lead in effective strategic HRM planning, and is successful in thistask, then quite possibility it will be awarded greater decision-making power as a central player in the future of the company.Further, if HR policy is established early, then managers inthe venture have formalized guidelines to follow for theimplementation of various HR practices. This is a specialrequirement in joint ventures, when formerly parent staff arerelocated to the JV and want some assurance that benefits and otherpolicies will not be substandard to those enjoyed in the parentcompany. In this investigation, for example, at OCG the HR managerimmediately began to develop HR policy which she anticipated wouldbe beneficial to the Ardsley group, in order that they know what toexpect in the new venture. Alternately, the early development ofsome HR policies at Triad was curtailed due to both the largenumber of policies required, and a need to wait until the unioncontract was ratified. In this latter instance, specific HRpolicies were unknown to both employees and managers. In theabsence of HR policy at Triad, one manager remarked that he andothers \"made up their own policies\" as required. Based on theseexamples, the early establishment of HR policy and guidelines islikely to facilitate a more consistent application of policy inpractice.c) The Establishment of CredibilityMembers of the HR department are more likely to be viewedas credible when a clearly defined set of HR values andpriorities exists with which employees can identify andsupport.An added benefit related to the early development of HR policy369is that the HR department is able to establish a valued andcredible role for itself in the strategic functioning of theventure. The HR department can become an important source ofinformation and provide resources to managers and employees in thejoint venture. This is most likely to occur if the informationprovided is considered valued and timely by the recipients.HR credibility is likely to be enhanced when within the HRdepartment, members are able to define a clear set of HR values andpriorities. If various departmental members are divided as totheir role, and which HR values should predominate, then there isless likely to be a clear, consistent message transmitted to othersin the JV as to what is important in the realm of human resources.To elaborate, one HR manager commented that it was inconsistency ofthe goals and values within the HR group which, to some extent, hasresulted in diminished credibility for the department. Within hisdepartment, different opinions were expressed as to the amount ofemployee autonomy and responsibility which should operate in theJV. To some degree, the HR department can have a role is thecreation of HR-related values in the organization, but this task iscompromised until the group can first define a consolidatedposition for themselves.Further, the support of other key players is important if theHR department is to have sufficient power to make policy changes oradjustments. If organizational members feel they have some inputto new HR policies, then the job of \"selling\" policies orstrategies to other managers and employees becomes an easier taskfor HR staff. At OCG and Triad, input from managers and others inthe JV was requested by the HR department on HR policy prior to its370implementation. This process not only provides the HR departmentwith policy feedback, but serves to build interrelationships andsupport between various groups in the organization (Kanter, 1988).At Mayo Forest Products the Personnel Administrator and othermanagers had decided to bypass the union committee to provideperformance information directly to production employees. Theunion responded with a flurry of grievances. The PersonnelAdministrator described this situation in the following way: \"we'vedecided that bypassing the plant committee is not necessarily inour best interests in that they maintain a certain status out inthe mill with the crew members...by bypassing them, we do ourselvessome harm.\" In this case, if the HR manager and other managers areto gain organizational support for changes to policies orpractices, then first they must secure the approval of keystakeholders in the JV.d) Charting New Values and PolicyAn awareness by HR staff of the unique requirements ofthe JV and the parent companies, as well as sensitivityto differences in national and corporate cultures as theyexist within the venture, contributes to the formationof new HR systems which are appropriate for all groups.In joint ventures when employees from the parents and newhires are merged together, operating assumptions and policies whichwere familiar to employees in the parent firms become changed. Forexample, at OCG, new HR policy was to be created with a goal ofintegration of the Ardsley group into the JV, in order that theyare satisfied with the new policies and environment. At Triad, HRpolicy was formed based on a consolidation of values and371expectations from two diverse cultural groups. In each case, priorto the creation of appropriate policy, HR staff first attempted todefine and understand the operating norms and values of the variousgroups in the venture. This was not an insignificant task. AtOCG, the HR managers conducted interviews with all Ardsleyemployees to determine their needs and concerns. At Triad, bothAmerican and Japanese managers provided input to the HR policyformation process, which managers noted was very time-consuming.Once an HR policy is formed, special requirements may exist toexplain the rationale behind the policy to different sub-groups.For example, at Triad, the Japanese Assistant Manager in HR took onthe role of explaining HR policy to other Japanese managers, whowere otherwise unfamiliar with many new HR directives. This is animportant task in multicultural environments, if HR policy is to beeffectively applied. During the implementation of the newperformance appraisal system at Triad, American managers providedinformation on the appraisal process to Japanese managers, askedfor implementation feedback, and make assessments related to policyunderstanding. In the early stages, Japanese managers were notentirely comfortable with the performance review process, andtraining was provided to assist the Japanese to better understandand operate the system. In this way, values and assumptions ofdiverse cultural groups are incorporated into new policy, andmonitoring is provided by the HR department to determine theeffectiveness of policy applications.Although a need for consistency in policy has been suggestedalready, this does not mean policy inflexibility which ignoresunique situations and requirements. In this sense, the HR mandate372may be most successful if established policy or rules are balancedwith flexibility to meet practical operating considerations. Thiswas demonstrated at Triad in the creation of a new performanceappraisal system. A PA system which HR managers felt was importantfor providing performance information to American workers wasmodified significantly to fit the operating values of Japanese, aswell as American managers in the plant. In another example, at OCGalthough there is a policy in effect which prohibits employees tobid back to the parents for two years, this policy could bemodified under certain circumstances if a transfer back to theparent was clearly beneficial for employee career development. Ifthe HR department does not introduce flexibility into operatingpractice, then quite possibly resistance to new operating norms andvalues will be encountered from JV staff who feel their uniquecultural assumptions or operating requirements are overlooked.Further, as integrators of values and systems, HR managersmight organize HR processes which provide information exchangeacross different divisional boundaries or groups. This occurred atOCG, when the HR manager set up a cross-divisional task teambetween the R&D and production departments. Although these twodepartments had previously viewed their roles and values asseparate from one another, the establishment of task groups andcross-training between R&D and production was a conscious move bythe HR manager to build greater cooperation and exchange betweenthe units. In a similar way, the \"counterbalancing\" of managers atTriad served to integrate cultural and technological informationbetween members of diverse groups. Transfers between staff at OCG,Optima, and Triad serve this function as well.373e) Resource RequirementsIf the HR department has insufficient staff and financialresources, then its role as a \"process expert\" in theorganization is severely hampered.The quality of staff assigned to the HR department should beexemplary, and possess both technical and interpersonal skills ifthey are to deal with complex HR issues.Two of the joint ventures in this investigation wereunderstaffed - OCG, and Triad. Although the HR manager at OCG hasa significant role in setting new policy for the venture, she isalone in the department, with administrative assistance. Further,OCG was the only venture in which an HR manager was not located onthe production site. Managers and employees in the venture notedthat locating a member from the HR department in the plant wouldassist staff to better understand and consistently apply HR policyand procedure.At Triad, an HR manager mentioned that the department would\"like to take more of a leadership role, but we've been hampered indoing that from the standpoint that we don't have the number ofpeople to do anything. Right now all we can do is react to thingsthat happen.\" If the role of HR in the organization is to beproactive in the creation of new HR policy and processes,sufficient numbers are staff are needed for the fulfilment of thismandate.374f) Constant ChangeFast paced organizational change requires HR managers toreadily adapt HR policy to match altered JV strategicpriorities. Failing this, the HR department loses itsability to participate as a central player in theorganization.Changes to HRM policy are one example of administrativelearning which occurred in the joint ventures in this study. Inall JVs there is evidence of ongoing change and revision in the wayHRM operates. HRM priorities and functions are not static in theorganization, but are variable and changing. Even in moreestablished ventures such as Mayo Forest Products and Optima, thecompanies were in the midst of reorganization plans whichnecessitated the implementation of major changes to HR policy andprocess. These changes are not metered and linear in direction,but based on experimentation, and refocusing, until policy fits theneeds of the organization.3. Communication Systemsa) Multiple Forms of CommunicationCommunication systems which are open, and operate bothhorizontally and vertically contribute to the degreeemployees know about JV goals and objectives, andmanagement's intentions regarding products, processes,and policies.Communication is especially important in joint ventures, whererequirements exist not only to keep information flowing within asingle company, but between the JV and parents, and between375international locations of the venture as well. As already noted,management of the JV-parent relationship was facilitated by goodinterpersonal relations and informal communication among managersin the venture and the parent firms. Communication channels werealso created through the transfer of employees. On aninternational level, teleconferences and world-wide meetings suchas at OCG, served to link the various arms of the operation.Within the venture, the most successful communication systemswere open and operate between multiple hierarchical levels (i.e.between managers, supervisors, and production staff). For exampleat Mayo Forest Products, generally staff at all levels felt theyhave a good knowledge of the business, and of management'sintentions. Production employees at Mayo said they receivedinformation through weekly meetings and from bulletin boards. Ason employee commented, \"everybody can see where we stand\".Although some supervisors did withhold information from associates,production staff note they were generally well informed. Managersat Mayo describe that there are \"no secrets\". Communication wasapparent between managers and production employees, and betweenmanagers and supervisors.At Optima, an associate remarks that shift supervisors \"arewonderful to keep us informed on administrative type things,manufacturing changes...they're great about communication\". At theheadquarters office and in the plants, focus groups operate as adeliberate way to provide employees with a face-to-face chance toask questions of managers related to any aspect of the company.Management's challenge is to establish a norm of trust and sharingfor the meetings. As these sessions currently operate, associates376are hesitant to discuss \"real issues\" for fear of appearinguncooperative. As in other areas of Optima, where supervisors areattempting to prove to production employees that they are sincerein what they do, the process of establishing trust will takeconsistent application of norms which reflect openness, and time.In addition, horizontal communication across levels (i.e.between various units and employee teams) was considered important.At Optima, cross-team coordination was accomplished by a teamproject manager for production, who arranges weekly meetings forassociate coordinators on each shift. These meetings wereestablished to facilitate the integration and coordination ofefforts and communication across teams. At OCG, cross-functionalteams and task forces serve to likewise create communication linksacross organizational units. Further, at Mayo, Optima and Triad,the existence of a newsletter which focused on the JV, rather thanon more general parent operations, helped to draw JV personneltogether as a unit.In general, active forms of communication which involve thedirect interaction of employees in the JVs were more favored byemployees than passive forms of information exchange such as memos,reports, or newsletters. One manager observes that althoughtelephone and fax are adequate, \"there is no substitute for face-to-face communication\". Several managers mentioned the importanceof establishing personal contacts with their counterparts, inmeetings which involved face-to-face interactions. A manager atOptima notes that the development of personal relationshipssignificantly enhanced his ability to discuss future issues withhis contacts on a telephone basis. The temporary assignment of377personnel from the parents to the venture provides an opportunityfor managers or other staff to work together over a period of time,and further to gain a better understanding of one another. This islikely to have added benefit when the participants are not all fromthe same national culture. Through direct interactions betweenmembers of diverse cultures are cultural appreciations more likelyto be enhanced, and stereotypes dispelled.Whether information is shared between groups within the JV,or interorganizationally (among geographically dispersed JV units,or between the JV and the parent firms) depends on several factors.Schein (1986) elaborates that the amount and content of informationshared relates to: 1. a common language, 2. consensus on groupboundaries (who is considered an insider or an outsider), and 3.how power and influence between individuals or in a group arestratified. Even in companies, such as the four joint ventures inthis investigation, where numerous mechanisms for communicationexist, information sharing may be constrained by languagedifficulties, lack of trust between groups, cultural boundaries, ora perceived requirement to retain \"information as power\". In turn,these elements affect the quality of information shared amongemployees in the JVs in this study, as elaborated in the followingsections.b) Communication Across CulturesAcross cultures, communication difficulties may beameliorated by the use of illustrations, interpreters,cultural \"liaisons\", and some understanding of howinformal norms related to information exchange operatebetween different cultural groups.378In joint ventures where there is a significant representationof managers and other staff from more that one national culture,communication systems are likely to be complicated by the presenceof multiple languages, and diverse cultural norms and values. AtTriad, for instance, communication difficulties were prevalent, andin part related to two different languages spoken in the plant.Employees at various levels at Triad mentioned they thoughtcommunication was probably the biggest problem in the plant.Although many of the Japanese at Triad speak English, subtledifferences related to communication often resulted in frustrationor miscommunication for employees. This finding is supported byother researchers who found language differences to be afundamental problem in Japanese-American JVs. Specifically,Peterson and Schwind (1977) found that 86 percent of employees inJVs in Japan mentioned communication difficulties in the venture.At Triad, the inability by Americans and Japanese tounderstand one another's language partially was bridged by the useof illustrations and interpreters. Interpreters were predominantlyused on the plant floor to help Japanese technical assistants andcoordinators (who were providing manufacturing expertise), tocommunicate with American managers and associates. Illustrationswere also found to be helpful, and both Japanese and Americanswrote down content and diagrams on a white board. In other writtencommunication, one American manager notes that the Japanesepreferred to see graphs and charts.The exchange of technical information was less problematicthan other areas of communication. One Japanese executive at Triadconsidered technical exchanges to be \"very successful\". This may379be assisted by a common technical language shared by engineers inthe plant, regardless of whether they spoke English or Japanese.This thought is given support by Lewis (1990:258), who suggeststhat around the world scientists and engineers in the samediscipline are,Educated with the same principles, use the same texts,read the same journals, and share the same jargon...Thus,more than any other discipline, science and technologyshare many values that cut across other culturalboundaries.Further, a Japanese employee at OCG who considered himself a\"liaison\" between various groups in the venture, describes thedifficulty of conveying meaning across cultures. To assist withthe communication process, not only did this individual translatereports, but he also tried to capture the underlying meaning andintent of the Japanese text. At Triad, where there were twomanagers with bicultural skills, they filled a similar role. Towhat extent individuals with bicultural skills exist ininternational organizations, and which specific roles they play areinteresting questions for future research.Alternately, few Americans have multiple language or culturalskills. As one Japanese manager at Triad remarked, there is muchhesitancy on the part of Americans to learn a foreign language.Generally, Americans expect that members of another culture will beable to speak English. This tended to be the case at Optima, aswell. One manager noted that the German technical staff who workedat Optima, or German managers with whom he communicated but whowere located in Germany, were all conversant in English. Americanmanagers at Optima remarked that the ability on the part of theGermans to speak English had greatly enhanced the communication380process in the venture.Beyond difficulties experienced by Triad staff due to multiplelanguages in the plant, communication also was influenced by theexistence of different informal norms for information exchangerelated to national culture. Although differing communicationnorms existed in both the American and the Japanese culturalgroups, the norms operating in the Japanese group had the greatestimpact. In large part this occurred because the Japanese parenthad the manufacturing and management responsibility for Triad, andin this role provided strategic information to the plant throughJapanese managers on assignment from the parent company. Partlydue to language ease, and partly due to style preferences andfamiliarity, Japanese managers at Triad meet in informal groups,often after work, to exchange information. This form ofinteraction has the automatic effect of partial exclusion ofAmerican managers from obtaining strategic or other technicalinformation which Japanese managers might possess. Some of theAmerican managers at Triad viewed this exclusion with concern, andfelt \"left out\" of the main stream of information exchange. Withrespect to HR-related matters, in some instances Japanese managersdirectly interacted with the Vice-President of HRM, (who is arepresentative of Japan Motors), rather than to deal directly withthe American HR manager with relevant functional responsibility.In other divisions, as well, American managers reported that aJapanese manager may consult with a Japanese coordinator, andbypass the branch manager in charge of the project.Related to these examples, important information in the JVsoften is passed through informal, nondesignated information381channels rather than through a more formal and institutionalizedinformation system. Individuals who are \"outsiders\" can not expectto be privy to all levels of information as it exists in thecompany. This reality has implications for employees related totheir ability to effectively accomplish tasks, and for the degreeof job satisfaction which they experience.The operation of informal communication systems existed withinother JVs in this research, but less powerfully than the informalsystems which existed at Triad. In shared management jointventures between partners from widely diverse national cultures,one might expect the operation of informal communication systems tobe more prevalent than in companies where more culturally similargroups are represented. This possibility may result when membersfrom different national cultures gravitate toward operating stylesand norms, and within group interactions, which are most familiar.This postulate, however, remains a question for future research.Further, how might the operation of informal norms and systems forcommunication influence the effective exchange of informationbetween groups from different national cultures in the venture?c) Sharing Technical InformationSharing of technical information between JV and parentemployees may be hampered when the recipient isconsidered an \"outsider\", or under conditions whenorganizational commitment or trust are not yetestablished.In international joint ventures, especially when the goal ofthe parents is to create value-added products, technology sharingfrom the parents to the venture is necessary. However, information382exchange among the JV-parent groups may be complicated whenindividuals feel that providing sensitive information compromisesthe parent's strategic position (i.e. related to product secrecy,or innovative technology). In addition, one might expect more openexchanges of information between parent employees in theheadquarters office and that parent's staff who are transferred tothe venture. In each case, they are \"insiders\" and belong to thesame parent organization. Staff who are transferred to the JV fromthe parent firm are still considered members of the parent, andtherefore more likely to receive privileged information. This isin contrast to information sharing which may occur at Optima, forexample, between Bauer parent headquarters staff, and Fiberopemployees in the venture. In this instance, managers or technicalstaff from the parent may be reluctant to share information withstaff from the partner firm, even though they all are associatedwith the JV.Related to this, a Bauer employee on assignment to the R&Ddivision at Optima, remarked that he was more likely than an\"outside\" employee, (i.e. either from Optima or from the Americanparent Fiberop), to have access to information in the German parentcompany and its subsidiaries. Alternately, an engineer from Bauermentioned that he had experienced difficulties trying to obtaintechnical information from Fiberop. In this sense, the extent towhich members of the JV or the parent firms either screen or shareinformation with one another has implications for the amount oftechnical learning which is possible in the venture. If themanagement of parent firms commit to a joint venture in which theintent is to create value-added products (as was the case in383Optima), then at the most senior levels of the venture, mechanismsand norms should to be established which support open informationexchange as it affects the JV. At Optima, the placement of a Baueremployee in the position of Vice-President of Cable Technologysignificantly contributed to information transfer from Bauer to theJV. Further, information exchange may be enhanced if rewards formanagers and other employees are based on joint productdevelopment; although this did not appear to happen in the jointventures in this investigation. If norms for openness andcollaboration do not exist, there is the possibility of informationrestriction between the parents and JV, which on the long-term mayaffect the ability of managers to realize technical, as well asinterpersonal opportunities in the venture. Employees who feelthey can not accomplish tasks due to a constricted flow ofinformation may eventually feel demoralized, and question theircontinued participation in the venture.Although in general, one might expect to see more frequent andopen exchanges between headquarters and other employees who belongto the same parent firm, there are some conditions which maymoderate how these communications operate. For instance, at Triad,some of the Spartica task force (those who remained in the ventureand who were committed to the JV goals), began to feel more a partof the venture than the parent. In fact, as one Spartica managerobserved, he has a more valued role at Triad than in the parentorganization. Specifically, he remarks, \"we made an earnest effortto help and got involved [at Triad]. And those [of us] who did areappreciated more than we ever could have been back home [atSpartica], because we helped fill some of those cultural gaps\".384This Spartica manager expressed an allegiance to the venture, anda desire to focus his energies to help Triad succeed. As loyaltyby parent employees to the JV increases, and if there is minimalappreciation of efforts by the parent firm, a gradual reduction inthe amount of information exchanged between the parent transfer andhis or her counterparts at the headquarters office might beexpected. At Triad, this had implications for the accomplishmentof parent goals. Originally, Spartica entered the venture to learnfrom the Japanese partner, and sent Spartica employees to Triad forthis purpose. As Spartica transfers either returned to the parent,or gradually reduced parent ties, as described here, then theaccomplishment of Spartica's original goals for learning from theventure involvement were reduced.d) Information Sharing Among Joint Venture Subgroups:Information sharing may be constricted among subgroups inthe organization, especially under conditions ofuncertainty and mistrust.In all of the JVs in this investigation, some supervisorswithheld information from production employees. Generally, thiswas related to a fear by supervisors that if information is shared,one gives up control, or perhaps makes his or her role in theorganization redundant. Further, open information exchange did notalways occur between other subgroups in the JVs. For example, inunion-management relations an ideological tradition exists that theunion expects management to take advantage of employees, andtherefore needs to provide employee protection.Operating assumptions form the framework throughorganizational members, either supervisors or union employees, as385in these examples, make sense of their organizational roles. Asconditions in the joint venture environment begin to change, andsupervisor's roles shift, or the union is asked to be more involvedin the management process, member role reevaluations may berequired. Role shifts such as those described here are predicatedby uncertainly, often mistrust, and are uncomfortable in theinterim stages until a new organizational position is solidified.In these interim stages, exchanges of information may be guarded,until proof is supplied that normative changes will actually occur.Alternately, if members of each group are made to feel moresecure in their roles, then possibly greater willingness toproductively interact can be encouraged. For example, ifsupervisors receive training in role alignments (as they did atOptima), and develop a new role as \"enablers\" in relation toassociates, then the risk of losing power to the associate group isless relevant. In a similar way, if union and management are ableto develop some continuity, rather than separateness, of roles thena goal for working together might be nurtured (as was beginning atMayo Forest Products). Consequently, less energy is expended byeach group on a \"them and us\" position. In companies where theintegration of subgroups, and the development on relatedcommunication channels to foster mutual goals and understanding isnot encouraged, the possible result is employee dissatisfaction anda focus on \"groupism\" where joint contributions are hampered.3864. Reward and Recognitiona) Goals of Reward SystemsTQM, product innovation, and teamwork are important inall the ventures. However, only in a few instances wererewards offered to employees in alignment with theirefforts in these areas.The purpose of monetary compensation is to attract, motivateand to retain employees. In competitive, joint venture companies,ideally compensation systems are structured to reward employees forproduct improvements and work performance which exceed normal workrequirements. Reward incentives for employees which are linked tolearning and innovation, are most likely to result in the creationof new solutions, or changes to products or processes whichultimately benefit the firm. In competitive companies when rewardsare absent for high employee performance in these areas,inconsistency exists between stated policy and policy in action.Typically, in the JVs in this study, pay is not linked toperformance, especially for hourly employees. This is in contrastto reward structures present in other progressive companies, wherethe compensation system \"emphasizes the individuality anddistinctive competencies of each person, with pay allocated forknowledge and performance\" (Forward et al. 191:39). However, inthe near future at Optima, managers in the plants plan to institutea system for associates which rewards employees for exemplaryperformance; and eventually, to adopt a \"pay for skills\" approach.If managers are to encourage employees to learn new skills, andperform to maximum capacity, then reward systems will be inalignment with these stated objectives.387For example, in companies where innovation and creativity aredesired, reward systems will ideally reflect such goals. At bothOCG and Optima some rewards exist for salaried employees related totechnological accomplishments. In addition, organizational valuesand norms may support risk-taking as part of a process leading tonew solutions. For example, at Mayo Forest Products, one managersaid that making calculated mistakes is not considered unfavorable.He added \"we make a bunch of mistakes and we make them quick\".There is a quarterly award at Mayo for the person who has made thebiggest mistake. This action sends a strong message to employeesthat mistakes are acceptable as part of a broader search forproduct improvement. Further, if a goal in manufacturingfacilities is to develop team activities, then rewards should beprovided to employees for team, rather than for individualperformance, as some managers are quick to observe. Generally, inthe JVs in this project, rewards were provided on an individualbasis, rather than for teamwork.At the executive level, compensation which is tied to JVsuccess provides incentives for managers to concentrate on theviability of the venture (Frayne and Geringer, 1989). However,this form of executive compensation was not usually applied in theJVs in this research. Without incentives which are tied to ventureperformance, executives or other managers (who may experiencedivided loyalty to the JV and the parent anyway), may be tempted tospend more time making career connections back to the parent firm,than to stimulate financial success in the JV. Also related to JVsuccess, financial rewards can be a powerful tool to encouragecooperation between technical staff, task force groups, or other388cross-functional teams between JV and parent staff. If variousincentives for joint project success are available to employees,then technological sharing, innovation based on combined expertisefrom parent groups, and project successes may be more likely toflourish. Reward systems which are designed to suit the uniqueorientation of the venture, as opposed to those taken whole orpiecemeal from the parent firms may be most effective.b) Multiple Compensation SystemsThe presence of multiple compensation systems in the JVis not problematic for employees if they view rewards asconsistently applied within their own groups.In international joint ventures, the possibility exists thatmore than one compensation system may operate simultaneously.Executives or other employees transferred to the venture may remainon the payroll of the parent firm. In addition, a separatecompensation system might be developed for JV staff. For example,at OCG, Optima and Triad, more than one compensation system was inoperation. More specifically, at OCG the Ardsley group who aredesignated as JV staff currently are leased to the venture; theyremain on the CIBA-GEIGY payroll and benefit systems, and costs tothe parent are billed back to OCG. At Triad, a large number ofupper level executives who remain employees of either Spartica orJapan Motors, are paid by the parent. At both Optima and Triad,technical staff on temporary loan to the JV also continue to bepaid by the parent firm.According to Cascio and Serapio (1991:71) multiplecompensation systems may have a negative impact on staff ininternational alliances. They write,389Failure to establish a uniform compensation policy in aninternational alliance that requires high interactionamong employees from different partners can lead topredictably adverse effects. Differences in compensationsystems, especially for employees doing the same jobs,often lead to feelings of inequity among those receivinglower compensation and benefits. Morale and motivationtherefore suffer among group members.However, contrary to these predictions, multiple compensationarrangements did not seem problematic for JV staff in the venturesin this study. Generally, JV employees knew that different rewardsystems existed, but felt that as long as an individual remainedunder the parent umbrella, he or she was considered in a differentcategory. Further, most staff were not aware of actual salarydifferences which existed. What appeared to be a more importantfactor for employees in their judgement of fairness related tocompensation systems, is whether reward systems are consistentlyapplied within the group of employees officially designated to theJV. This was more significant to employees than the manner inwhich staff on temporary assignment from the parent are rewarded.Related to this, if reward incentives appear inconsistent within adepartment in the JV, then staff are likely to be dissatisfied.For example, at Optima, different awards are available to salesversus marketing staff, and had been a source of discontent formarketing employees who perceive they are not able to make as muchmoney as their counterparts in sales.c) The Creation of Meaningful Recognition Systems:Managers find recognition systems difficult to implement.To be most meaningful, recognition is:^linked toemployee performance; individually valued by employees;and consistently applied.390As is the case with monetary reward systems, nonmonetaryrecognition systems in progressive companies are instituted torecognize excellence in employee performance. Recognitiondemonstrates to employees that their efforts are appreciated, andconsequently encourages continued excellence. If recognitionprograms are to be consistent with a teamwork approach advocated bymanagers in the JVs in this investigation, then recognition will beprovided for group effort and accomplishments. This does notpreclude the existence of individual recognition as well.Generally, despite stated team objectives, recognition was givenfor individual, rather than team efforts.The area of employee recognition is problematic to the JVmanagers in this research. In support of this idea, managers atMayo Forest Products feel one of the biggest challenges they faceis the creation of meaningful employee recognition systems.Employees were not always informed or aware of the reason forrecognition, diluting its reinforcement value. At Optima, amanager remarks, \"a lot of the employees are uncomfortable beingrecognized as the employee of the quarter because in a lot of casesthey don't really understand why\". This suggests that ifrecognition programs are to have maximal value, then employees needa clear concept of what the programs involve, and why recognitionis offered.Some employees stated that they like to be recognized; othersfelt the recognition was an embarrassment. Related to this, theeffect of recognition programs will vary greatly depending onindividual employee preferences. For this reason, managers mustconsider what is appropriate recognition for either an individual391or a group. Although considerable time was spent on thedevelopment of recognition programs in this research, there waslittle evidence that managers spent time tailoring reinforcementsto be appropriate for specific individuals or groups. Further, ifmanagers do not use sensitivity in the recognition of employees,these programs potentially may have a negative effect onperformance. For example, one HR manager at Optima suggests thatrecognition programs can demotivate employees, if recognition doesnot also reward the average performer for improved performance.At Triad, employee recognition programs did not operate,except for QC performance. Although in general, Japanese managersdid not favor a recognition system, some American managers notethat there should be small gifts and other forms of recognitionavailable to employees for no lost time or project accomplishments.One American manager mentioned that Americans are different fromthe Japanese and appreciate \"public acknowledgement\" forachievements. An associate at Triad concurs that he would like tosee more recognition of employees, \"to know that the work thatyou're doing is appreciated, and that they [management] are lookingat you\". In view of these comments, there is some evidence thatthe influence of Japanese management preferences in the plant mayrequire some revision in the area of recognition, in order toaccommodate the expectations of American workers. The HRdepartment can have a role in the creation of new recognitionprograms, but first they need endorsement from Japanese managersthat the application of these programs will have plant-wideapproval, including that of the Japanese managers.One of the most successful recognition programs operating in392the JVs in this study was created by associates themselves. AtOptima, a team in Plant 1 was responsible for the creation of an\"Employee of the Month\" program in which associates nominate theirpeers for recognition. A manager in the plant perceived thatemployees generally view this award as prestigious, where in othercompanies \"Employee of the Month\" is more likely to be viewed as apopularity contest. This manager mentions he had \"heard thecomplaint that it's a popularity contest, but I've only heard thatfrom a couple of people\". It may be that recognition programscreated and administered by employees are considered to be moremeaningful, and less subject to favoritism by managers. Thissupposition requires further investigation. As numerous managersand production employees pointed out in the course of this project,often an employee's peers best know his or her level ofperformance.In all JVs except Triad, recognition was provided to employeesfor safe work performance, and was withheld from employees who hadon-the-job accidents. Although safety was a priority in all JVs,the merits of providing recognition and/or monetary reward in thisarea are not clear. In fact, according to traditionalreinforcement theory, the withholding of reward is considered\"negative reinforcement\". In companies where recognition in theform of \"safety bucks\" is given for safe work performance, then thewithholding of safety recognition and rewards is an incentive foremployees to conceal injuries. In companies where safetyrecognition is for groups, rather than for individual on-the-jobsafety, employees who report injuries may feel as though they arecontributing to the loss of recognition for their entire group.393Some of their peers may perceive this also. To illustrate, someemployees did avoid reporting minor injuries in order to maintaina safe work record. At Mayo Forest Products, one production workerexplains, \"I got a little bonk on the head and I went to first aidand got it checked out there and then I didn't get my fifteendollars. And that made me mad...I don't like thatincentive...everybody is then hiding their little sprains andbruises.\" When recognition for safety is provided only if thereare no accidents in a unit or group, then peer pressure is placedon individuals who have an accident, therefore blemishing thesafety record of the entire group. One associate at Optimamentions that although members of a group should implicitly beconcerned for one another's safety, reward or recognition forsafety should only be based on individual performance.If recognition programs are to be considered fair byemployees, then managers must consistently apply the programs. Inat least one of the JVs in this study, a few managers independentlyhad decided that certain aspects of the company recognition programwere of minimal value (i.e. Employee of the Month). Subsequently,one department had this form of recognition, while another did not.Not only does the nonapplication of certain forms of recognitiondeviate from company stated strategic policy, but it also providesan inconsistent message to employees as to what is valued behaviorin the organization. Further, employees who see their peersrecognized for performance, when they are not, may become eitherdemoralized, or disillusioned with the way company policies are putinto practice. Although there can be positive benefits fromtailoring recognition to meet group needs, variation in recognition394programs within a company may have a negative impact on employees,who feel (despite what the manager thinks), that a particular formof recognition is worthwhile.In sum, in the areas of employee reward and recognition, noeasy solutions exist for the creation of an environment in whichworkers feel appreciated, and in turn desire to significantlycontribute to the success of the venture. However, based on someof the evidence in this research, reward and recognition programsmay be most effective if they are meaningful and consistentlyapplied. To the extent that recognition programs are aligned withthe strategic orientation of the venture, employees have a clearidea of what is important in order to contribute to the goals ofthe company. Ignoring these considerations, reward and recognitionprograms can have a demotivating effect on employees, and thusdetract from the original intent of the programs.5. Staffing and Promotiona) A Focus on High Calibre StaffCompetent, high potential employees are hired atmanagerial, technical and production levels. Personalskills are important, and in some cases, are a moreimportant consideration than technical competence.Both hourly and salaried employees were hired based on theirability to communicate, learn new skills and operate as teammembers. In some cases, technical competency seemed to be ofsecondary importance. For example, at Triad, employees withoutprevious experience in an automotive manufacturing setting weredeliberately hired, in anticipation that they would be more open to395novel ideas, and new ways of operating on the job. The Manager forQuality Circles at Triad mentioned that when he and others went toJapan for training in the early days of the venture, they hadexpected to be placed in jobs similar to those in which they hadpreviously worked. Instead, many placements were made based onpotential, rather than specifically related past experience.Somewhat surprising, there is little emphasis on acquiring JV staffin any of the ventures who have cross-cultural skills andabilities, international management experience, or multiplelanguage skills.Although, traditionally, salaried staff undergo a moreelaborate selection procedure than hourly employees, in the jointventures in this study production workers were thoroughly screenedas well. At Triad, associates were screened in the assessmentcentre. Although an assessment centre approach has typically beenused to select executive talent, it has rarely been used for theselection of production employees. At Mayo Forest Products andOptima, hiring of associates or hourly workers was done by aselection team.At Optima, the hiring committee which evaluates temporaryemployees for permanent positions is comprised of productionassociates. Associate selection is based on a \"mentor review\"completed by a prospective employee's peers who considersupervisor's ratings and attendance records. The system has beenoperating for three years and has been very successful. Althoughhiring of production employees by peer review is not prevalent inindustry, this system worked well at Optima. Responsibility forstaff selection is given to employees who know the job best, and396who will eventually interact with the prospective candidate. Thissystem of peer selection is likely to have maximum benefit whentraining in selection procedures is first provided to employeesresponsible for this task.The emphasis on staffing as seen in the JVs in thisinvestigation is in contrast to previous research on internationaljoint ventures. In a review of the literature on IJVs by Shenkarand Zeira (1987), they found that in twelve of nineteen studies onJV firms, a gap existed between actual and desired levels ofstaffing in the venture. Although there is no definitive answerwhy there is so much focus on high quality staffing in the four JVsin this study, one might speculate that this primarily is done inorder to accomplish the JV strategic objectives. In each of theventures, which has been very successful in product quality andinnovation, quality staff with broad skills are required to bothcontribute new ideas, as well as to have wide-based abilities inorder that they can rotate to various positions. High qualityproduction staff are especially critical to this process. In thefuture, it may be that companies which hope to successfully competeon a global scale will need particular focus on how they stafftheir operations.Further, if companies are to realize strategic objectives,sufficient numbers of staff are required to complete taskseffectively, while providing a minimal strain on employees in thisprocess. Staffing which is too lean may have numerous detrimentaleffects on both employees and the operation of the venture. Forexample, excessive overtime and multiple shifts can result indeterioration of employee health. At Triad, where production397demands have escalated in recent years, there are more staff offwork with injuries. In addition, because staffing is lean, thereis less time which production staff can devote to Kaizen andQuality Circles, which ultimately contribute to the realization ofJV objectives. Within the HR department at Triad, various managersnote that they require more HR staff in order to be proactive, andto keep up with demands for timely new policy. Given theseconsiderations, it seems that not only do competitive companiesrequire high calibre staff, but they also need them in sufficientnumbers.b) Transfers to the VentureEmployee transfers potentially contribute to sharing ofinformation and expertise between the JV and parents.Operational flexibility results from the temporarytransfer of employees; while longer-term commitments maybe fostered by more permanent staff assignments.Transfers of staff between the JV and the parent firms canprovide the mechanism for sharing information, learning from eachother's abilities and expertise, and for the creation of synergiesrelated to product development. Flexibility is built into theoperation by the temporary transfer of staff to work on projects,who then return to the parent once they are no longer required inthe JV. In joint ventures in which there is little or no transferof employees, opportunities for the parent and JV staff to learnfrom each other may be lost. This is especially the case whentechnical exchanges have the potential to enhance products andsystems in the JV. Related to this, Collins and Doorley (1991:114)suggest \"the key to transferring detailed technical knowledge, and398applying it commercially, is people\". The authors add that thismight best be accomplished by medium-term to long-term assignmentof parent personnel to the venture.Except at Mayo Forest Products, the joint ventures in thisstudy have large numbers of managerial and technical staff eitherpermanently reassigned or on loan to the JV from the parentcompanies. At OCG most of the upper level staff come from Olin andwere permanently transferred to the JV. Likewise, to gainadditional R&D expertise, the Ardsley group were to be permanentlyrelocated to OCG. At Optima, the executive staff are mostly onpermanent relocation from Fiberop, and R&D talent is transferred tothe JV by parent staff who are relocated on a temporary basis. AtTriad, all parent staff are on temporary assignment. None arepermanently reassigned to the JV. In the case of productionemployees, they were all hired directly to the ventures, except atOCG where former Olin employees in the manufacturing facility werereassigned as employees to the JV.In the joint ventures in this investigation, transfers werefor a significant period of time, usually for three to five years.Considering the benefits of staffing the JV with members from theparent firms, there is the advantage that linkages from the JV tothe parent are already established. Communication may befacilitated when transferred employees already know who to contactin the parent organizations for information or assistance, and havealready developed a working rapport with other parent employees.Obviously, if the JV is to gain the maximum benefit fromtransferred parent staff, then reassigned personnel should be wellqualified to contribute relevant expertise to the JV. In this399investigation, in at least one of the JVs, the quality of staffsent to the venture from the parents was a concern to somemanagers. If executives in the parent firms view the venture as a\"dumping ground\" for ineffectual managers, then they are likely toharm the long-term interests of the venture, as well as therelationship with their partner. Ultimately, if trust is to beestablished between the JV and the parents, then the interests ofthe JV should come first. Once managers in the parent firm looseconfidence that their partner will effectively contribute staff tothe JV, the consequence may be \"policing action\", so that seniorstaffing decisions by one parent require approval by the otherprior to their implementation.It is not uncommon that fairly large numbers of parentexecutives are transferred to the JV. Killing (1983) found thatJV executives were drawn from each parent in the majority of sharedmanagement ventures (11 of 19) which he studied. As alreadymentioned, in this research OCG, Optima, and Triad have manymanagers who have been reassigned from the parent firms. Thispolicy raises some interesting questions related to theestablishment of a joint venture with its own uniquecharacteristics, when there is a significant influence from theparents in the form of employee transfers. In particular, theparent with the JV management contract not only has managers andexecutives in the venture, but also tends to draw HR-relatedsupport from that parent.To elaborate, one manager at Optima mentions \"it's probablytrue to say that from a general standpoint the number of parentemployees that are brought in [to the JV] probably has a big400influence on how, and how fast the joint venture grows, what itlooks like, and what kind of culture it has\". In support of thisstatement, Frayne and Geringer (1989) suggest that the control ofJV operations by managers from the parent firm is related to thenumber of parent staff in the venture, and their particularassignments. Related to these comments, it is possible that if alarge number of parent employees are present in the JV, theestablishment of a unique and separate identity for the venture ismore difficult. When parent managers enter the venture they bringthe values and norms of the parent firm with them, which may notnecessarily meet the requirements of the JV. Further, if aninternal recruitment policy is in operation (either to hire fromthe parents or from within the JV), this may limit the ability tohire special talents which are only to be found externally. As onemanager at Optima described, they probably have enough managersfrom Fiberop, and would be better to cultivate people who morespecifically meet the unique needs of the venture.Another issue concerning the transfer of parent employees tothe JV relates to the advantages of permanent reassignment ofemployees (managers, technical personnel), versus temporarytransfers. As already suggested, temporary transfers providemaximal operational flexibility. However, the other considerationis that permanently assigned employees (or employees hired directlyto the JV), may have a greater commitment to the operation. Forexample, at Triad, managers hired directly to the venture seemed totake special pride in their status as \"Triad employees\", as opposedto being \"dispatchees\" from one of the parents. For employees whoare permanently located in the venture, their livelihood depends on401the JV success. This is especially true if policies are not inplace where JV staff can easily transfer to the parentorganization, and take all their seniority and benefits with them.Further, the degree of loyalty which employees feel toward theventure may be negatively affected if better employment prospectsare perceived to exist in the parent company.Whether or not carry over policies should exist for employeeswho wish to permanently relocate between the parent firms and theJV is a complex issue. If no carry over policies exist, thenemployees may feel somewhat \"trapped\" in the venture, as they didat OCG. This has the longer term effect of reduced morale andcontribution. Also, if it is difficult for employees to rejoin theparent firm once they have been on assignment to the JV, then thismay discourage talent from leaving the parent which may benecessary for optimal growth in the venture. Alternately, if anabundance of tangible benefits exist for staff who transfer to theJV, (i.e. special retirement benefits, various financial perks),then implicitly this may send a signal to employees that it is moredesirable to work in the parent firm; the incentives which areprovided may have the appearance of \"isolation pay\" related toassignment to the venture.Theoretically, JV assignments can provide great opportunitiesfor employees to gain broader, often international expertise in anew environment. This potentially adds value to employeecredentials. If managers in the parent strive to tie transferredemployees' career advancement in the parent to high levelperformance in the venture, then parent employees may view the JVassignment as a chance to gain valuable experience which is402ultimately linked to their career advancement. Typically thiscoupling was not initiated in the JVs in this study.c) Career Pathing and PromotionsWhen managers withhold information from employeesregarding career opportunities (or make decisionsindependent of employee input), employee responsibilityrelated to career self-development is greatly reduced.A relative absence of job postings and other career relatedinformation is problematic for employees in the ventures in thisinvestigation. Many employees express that they have limitedinformation related to jobs for which they are qualified. Ifformal career mechanisms, meant to inform employees of how todevelop their skills to match company needs in the future areunavailable, then not only does the employee miss personalopportunities for self-development, but the ability for employeesto contribute to the organization is limited. Ideally, promotioncriteria will be clearly stated and communicated to employees.This allows employees to understand the guidelines under whichpromotions are most likely to occur. Such action also preventscareer blocking in certain groups (i.e. women, minorities).Further, there may be a demotivating effect on employee performanceif the perception exists that there is no clearly defined avenuefor advancement, despite accomplishments. Further, in companiessuch the ventures in this research, where there is a focus onemployee responsibility, if career information or job postings donot exist, employee involvement is curtailed related to careerdevelopment. This is counter to the stated strategic objectives ofthese companies to allow employees responsibility and involvement.403In particular, when no job postings exist, some employeesviewed career or promotional systems as unfair. In the absence ofemployee input, managers decide the jobs for which their staffmight best be suited. Implicitly this process assumes thatmanagers or supervisors are both aware of employee interests andcapabilities, and are equally aware of all relevant careeropportunities in the organization. For managers with narrowfunctional experience this is unlikely to be the case. As onemanager at Optima remarks, \"what I think we fail to recognize isthat there are a lot of managers in this company who have no cross-functional experience who would have a very difficult timeexplaining to people what other jobs are out there\". In jointventures, when career paths may extend beyond the boundaries of theventure to include the parent firms as well, the possibility thatmanagers are unaware of employee career opportunities isheightened. One advantage in JVs is the possibility that JVemployees can move to the parents, or that parent employees canmove to the JV as part of their career progression. To provideemployees with information about these possibilities, a job postingsystem which provides job information to all relevant groups (inthe JV and the parents) would seem desirable. Generally, such asystem did not operate in the JVs in this research. At OCG, jobpostings were only available in Olin for employees who wished toconsider moving into the venture.Although transfers of parent employees into the JV can havethe effect of blocking career advancement for JV staff (Cascio andSerapio, 1991), this was generally not mentioned as a problem byemployees in the current investigation. Hypothetically, in this404study employees may not have seen their careers as blocked for tworeasons: 1. many of the parent managers transferred to the venturebecame JV employees (i.e. OCG, Optima), and 2. a large number oftemporary transfers did not occupy positions which would otherwisego to JV employees (i.e the technical coordinators or assistants atTriad). Also, at Triad, both managers and technical staff wereperceived by employees as central to the transfer of manufacturingand management expertise to the plant (and which most employeesthought of as a favorable arrangement). Further, from thebeginning days at Triad, JV managers (as opposed to parent managerson assignment), were aware that after the initial five year start-up period that many of the Japanese managers were designated toreturn to Japan Motors. Despite the presence of many Japanesemanagers, many promotions at Triad had already occurred. Relatedto these possibilities, future research might systematically focuson the conditions under which employees view their careers to beblocked in JVs when a relatively large number of parent employeesare present in the venture.6. Training and Developmenta) A Training Emphasis in the VenturesAn emphasis on wide-based training for employeescontributes to operational flexibility. A commitment oftime and financial resources is required for training ofemployees at all levels.Training is a major emphasis in the joint ventures in thisstudy. Training is wide-based and often involves cross-training ofproduction staff in order to build flexibility into the405manufacturing operation. Training focuses on both personal andtechnical skills. The extensive amount of training provided toemployees seemed to be worthwhile, and both associates and managersfelt they were sufficiently qualified to perform their jobs. Whenproblem-solving and teamwork are important, training might beexpected to focus on these components, although this was notevident in all companies in this investigation. Associates atOptima and Triad did, however, receive training in these areas.At Triad, training was provided to associates by Japanesetechnical assistants and coordinators, an arrangement which seemedto work well in order to transfer technical training to JVemployees. As already noted, interpreters and the use ofillustrations assisted in this process. In addition, associatesreceived training in Quality Circles and Kaizen in formal programscreated by the Manager for Quality Circles. The content for thistraining was largely adopted from Japan Motors, but modifiedsomewhat for the American operation. For example, the originalemphasis on statistical monitoring was decreased somewhat forAmerican associates, although employees who desired could take anadvanced version of the QC program.Training programs is the JVs generally required long-termplanning and a considerable investment of time and resources.Programs under which production employees are given responsibilityfor peer training (i.e. \"train the trainer\" programs), worked wellat Optima. In this format, associates are given responsibility andautonomy in practice. This shift in training responsibilitynecessitated that supervisors receive training related to their newroles, and this was also implemented at Optima. In general, one406might expect that the most successful training programs are basedon identified employee needs and linked to employee careerdevelopment, although this was seldom done in the JVs in thisinvestigation. Further, there is little evidence of jobretraining. This would appear to limit opportunities for employeesto develop new skills.b) Cultural TrainingTraining programs related to national or corporatecultures have the potential to inform employees about thevalues, history, or other traditions related to theirwork environment. However, cultural training isgenerally neglected.Cultural training in the ventures can encompass 1. the normsand values which operate in the company, and with which employeesmay eventually identify, and 2. language and other training relatedto the creation of a better understanding of the national cultureof the parents or off-shore customers.More specifically, in some of the ventures training wasprovided to employees about the company strategic mission, JVhistory and traditions, the business environment in which the JVoperates, and how to manage and understand change. For example, atOptima a course is provided called \"Optima Environment\", related tohow the company operates in the technological environment. Also atOptima, associates and supervisors receive training in how tomanage changing roles in the plant, and why changes have occurred.Although this form of training is generally not offered in mostcompanies, the information seemed valuable to employees in orderthat they make better sense of the work environment. Training407related to the corporate culture can be offered in orientationsessions provided to new employees (Cascio and Serapio, 1991). Forexample, at Mayo Forest Products the orientation includes safety,the quality emphasis is the company, and an identification of thepeople who work in the operation. The employee handbook which isgiven to new employees, provides a brief history of Mayo andmentions the joint venture arrangement of the company.An important consideration for JV managers is which parentvalues and styles will predominate in the venture, or whether theintent is to create a unique corporate culture for the JV, separatefrom the parents. Based on who provides training, priorities andvalues will be passed to employees. If one parent provides themajority of training, then it is likely that certain operatingnorms and values will be transferred to JV employees by eithertrainers or training materials which are associated with theparent. In one case, training content and other \"culturalinformation\" given to JV employees may have on it the name of theparent firm. JV employees have indicated some resentment towardthis practice, especially when they have been absorbed into theventure from the nondominant parent company.When more than one national cultural is represented in the JV,there are advantages to training which is provided to employees ofboth cultural groups about the cultures and languages which operatein the venture. In IJVs, the importance of multiple languageskills and international management skills can not be diminished.Although some language training was offered, many American managersdid not attend the classes. Somewhat surprising, none of theventures emphasized training related to the specific skills408required of international managers. It may be that employees wouldbe more encouraged to attain these skills if they are linked topromotions and other career progressions. As mentioned in anearlier section, neither was training offered as to how best managethe JV-parent relationship.In the instances when training related to national culture isoffered, the material is not generally provided in a forum whichallows for the active integration of cultural information. Forexample, training content is typically provided in a classroomsetting, without an opportunity for participants to discussdifferences and similarities between the national culturesrepresented in the venture. If JV members are to gain enhancedcultural understanding, then ideally an action learning model willoperate in which employees explore cultural values, acceptedprocesses or policies, and cultural interpretations. This form ofcultural analysis is especially appropriate for managers in JVs andother multicultural settings, who seek knowledge related to thediverse processes which operate among cultural groups. However, asJaeger (1986) notes, the format of interventions themselves aresubject to the influence of cultural expectations of theparticipants.A senior manager for training at Bauer GmbH at theheadquarters office in Germany described that the creation ofcross-cultural understanding is very important in the context ofjoint ventures and other forms of strategic alliances. Thismanager and others at Bauer headquarters, form a team which focusesspecifically on the development of training programs to enhancecultural communication and understanding between different cultural409groups within a given venture. Training programs are provided tomanagers in the alliances which help to enhance an appreciation ofthe partner's culture, and alternately to avoid culturalmisunderstanding. According to the Bauer manager, this form oftraining has been essential to the success of the companies withwhich he has been involved. Equally striking is the absence of asimilar training function in other international companies. To hisknowledge, this manager remarked that his division was the only oneof its kind which existed. The success of this program indicatesthat in other companies, a focus on better cultural understandingamong the partners, and training which specifically focuses on thistopic have merit, and deserve consideration on a wider scale.c) Job Rotation in Production FacilitiesAlthough job rotation has positive benefits for employeesand can alleviate boredom, it may be too expensive orinefficient for companies to implement.For example, as one individual at Mayo Forest Productsexplained, job rotation may incur extra costs for the company. Insawmills where job rotation did operate, an employee may work threedifferent jobs, (one week in each job), and is paid the top rate.This means an increase in payroll to the mill. In an economy wherejob turnover in the lumber industry is virtually nil, there existslittle incentive for companies to increase costs to retainemployees.Further, at Triad, some associates noted that preferred jobslike those off-line or in robotics were selectively assigned bysupervisors. In this way, not all employees had the opportunity towork at all jobs. If job rotation does not operate consistently,410then employees may come to quickly distrust the motives ofmanagers. On the long-term, employee dissatisfaction and reducedmotivation may be the result.When production schedules are a pressing concern for managers,less emphasis may be placed on training employees in multiple jobskills, and on job rotation. One manager mentioned that in moretechnical positions, there is an advantage to keeping employees ina single job because they gain more specialized experience.Several production employees in this study complained that they hadreceived reduced training due to production demands. Further, lesstime was available for employees to meet and discuss qualityimprovements to the production process. In these instances, thestrategic operating goals of the companies related to continuousimprovement and employee involvement are not sustained. It may bethat rigorous production schedules and systems which allow highemployee involvement are mutually exclusive. If so, then managerneed to determine their priorities related to maximum productoutput, versus other issues such as product quality or employee jobsatisfaction.4117. Performance AppraisalPerformance appraisal is one area which receivedinconsistent attention from managers.^However, incompanies where employees receive feedback from othersources (i.e. from supervisors on a regular basis),performance appraisal systems may not be essential.The goal of the companies in this project is to createconditions under which JV staff are encouraged to excel to meet thecompetitive demands of a global market. Performance reviews areone way to sensitize employees to performance objectives, providethem with performance feedback, and allow managers to gain a betterappreciation of employee skills, difficulties and careeraspirations. Yet despite the possibility of obtaining criticalinformation from the PA process, managers repeatedly said thatemployee reviews were a bother, inconsistently done, if done atall. To some extent this was a function of time, but in many casesmanagers seemed to think the reviews were not of essential value.In all four JVs there is a strong emphasis on the value ofproduction staff related to the creation of quality products in theventure. Consequently, tremendous effort is allocated to thetraining of hourly production employees. However, in only two ofthe four ventures was a performance review process provided tohourly workers. As one associate at Triad comments, he would liketo see a PA system in place in the plant in order that employeesare better informed about their job performance. He says \"you havepeople who are working hard, going the extra mile, doing theirjob...but you hear nothing\". In this context, a performance reviewsystem is viewed as a chance to have better interaction with412supervisors. In companies where feedback to employee about workperformance is a regular occurrence, it is possible that aninstitutionalized system for performance review is less necessary.Otherwise, the PA may be the only way in which employees know howthey are doing.To meet strategic objectives, the PA system will ideallyreinforce central operating requirements of the company such asquality, teamwork, or continuous improvement. Based on overallcompany objectives, employees are rewarded for the accomplishmentof personal goals in each area. For example, at OCG, thePerformance Management Process is a format where company objectivesof meeting customer requirements are individualized for employees.Performance is judged against various customer expectations. Asthe HR manager points out, this system has the advantage of notrelying on a single supervisor's evaluation and is based onmultiple input. In addition, the PA considers both technical andpersonal skills, and has a developmental component. In a similarway, the PA system at Triad mirrors the strategic goals for thecompany. Quality, teamwork, Kaizen, cost consciousness, problem-solving and other personal and technical skills are considered.Further, if company goals focus onexchange, or executive contributionsare important to the review process.are traditionally for individuals,approach is predominant, managersapplication of \"team reviews\". Inthe increase of technologyto the JV, then these itemsAlthough performance reviewsin companies where a teammay want to consider theall of these cases, the PAsystem aims to match company strategic goals.In order to meet the evolving needs of employees and the413company, ideally a developmental component is part of theappraisal. This may include the designation of longer-term andshort-term career goals for employees, as well as related futuretraining requirements. When performance goals are fixed andinflexible, then there is little opportunity for employees torespond to changing contingencies in the company. For example, infast-moving entrepreneurial firms with global associations, aflexible PA process is more likely to fit employee and companyrequirements than one in which performance goals and expectationsare static.Further, performance appraisal may be more meaningful toemployees if goals are not unilaterally determined by supervisors,but involve joint input from employees in which they can \"buy intothe process\". This form of PA would be most consistent with thegoals of the companies in this research which aim to provide highlevels of responsibility and involvement to employees. As anextension of employee involvement in the area of PA, in the futureat Optima associates will conduct \"peer reviews\", in whichemployees are responsible for the performance evaluations of eachother.PA may operate most effectively if it is consistently applied.At Optima and Triad, the HR departments offered training in the PAprocess to managers and others responsible for appraisals. Inaddition, written materials were made available to both managersand employees in order that they have a better understanding of theprocedure. This helped to ensure that managers and supervisorsunderstand the PA system, and know how it is to be applied.In joint ventures, a further issue is whether the PA process414will be based on the PA systems operating in one of the parentfirms, or developed to suit the specific needs of the venture. Asin other HR policy areas, there may be a time and cost savings ifPA is adapted from the parent firms. The trade-off is that theappraisal system may not exactly match the objectives of theventure.When diverse national cultures are represented, the creationof a PA system appropriate to all groups is likely to pose uniquechallenges. For example, at Triad the HR staff took great pains tocreate a simple PA system, with input from Japanese managers.Values and operating preferences of each cultural group wereconsidered related to the development of a culturally-sensitive PAformat. To assist the Japanese in the application of PAprocedures, the HR department assisted with the development oftraining programs related to appraisal implementation.415CHAPTER TENAN INTEGRATED VIEW OF INTERNATIONAL JOINTVENTURE FIRMSIntroductionInternational joint ventures represent an exceedingly complexform of organization. The presence of diverse national cultures inthe venture contributes to differences in employee values andexpectations, which in turn influence interpretations of companypolicy and practices (Adler and Jelinek, 1986; Laurent, 1986;Schneider, 1988). Further, in joint ventures where parent firmsare united under one umbrella, the corporate cultures of theparents may differ from one another. Even when parents are fromthe same national culture, distinctions in operating philosophiesand norms exist. Variations in corporate practices may revolvearound centralized versus decentralized decision-making; optimallevels of employee involvement; or appropriate forms of reward andrecognition, for example. Corporate differences are likely to becompounded when parent firms are from different national cultures,when deep-rooted, often unconscious, national value systems formthe context for organizational action. Further, HRM policy andpractice are influenced by both national culture and corporateculture as they operate within a company (Atchison, 1989; Ishida,1986; Peterson and Schwind, 1977).In this investigation, the cascading effect of nationalculture on corporate culture and HRM practice was best demonstratedat Triad. For instance, a \"traditional\" Japanese value of harmonyin work relations (\"wa\"), was integrated into the corporate valuesystem at both Japan Motors, and then at Triad in the form of416cooperative, involved employee participation. Related to thisgoal, managers in the HR department at Triad developed aperformance appraisal system which emphasizes employeecontributions and cooperation. In the joint venture, theaccommodation of values present in the Japan Motors system asreflected in HR policy required input by both Japanese and Americanmanagers. As was the case with the performance appraisal system,initial attempts to create a new system were modified a number oftimes before being suitable to both Japanese managers and to thelargely American workforce.As part of a process of organizational \"sensemaking\", acyclical process is likely to exist where policy and practice arereshaped to suit continually reconstructed value realities andexpectations in the organization. The HR department can possiblyhave an influential role in the value charting process, linked tospecific HR policy and practice. This is most likely to occur whenHR managers are considered central strategic players, and have thepolitical and social skills necessary to gain the support ofemployees and managers at all levels in the venture.In competitive organizations there are ongoing requirementsfor organizational renewal, change, and the creation of newknowledge. Mayo Forest Products and Optima are good examples ofJVs which after reevaluation of past practices, instituted majorreorganization plans which affected all levels of the company.This action was taken as a response to the external environment anda requirement to restyle the corporate culture in order to attainsuccess on a tougher, more demanding global stage. Concerningthese competitive goals, the corporate culture in each of the joint417ventures in this study was refocused to support a norm in whichorganizational learning is emphasized.Related to the an understanding of how strategic HRM operatesin the joint venture firms in this study, in the following sectionsconsideration will be given to issues related to corporate culture,organizational learning, and national culture. These sections drawfrom the earlier discussion on HRM, and summarize some of the moresubtle processes which operate at Mayo Forest Products, OCG,Optima, and at Triad, in order that these companies accomplishdesired goals related to both products and people. In addition,this section concludes with an overview of the main issues from theinvestigation, some discussion of the strengths and limitations ofthe project, and some personal summary comments.A. CORPORATE CULTURE1. Parent-based InfluenceTypically, JV partners consider how similar orcomplementary are their strategic objectives related tocompetitive product development or marketing prior toventure start-up. Much less often is the match ofcorporate values and philosophy related to HRM strategiesbetween the partners evaluated.According to a manager at OCG, this is a serious omission. Heelaborates,The most important thing on the human resource side is todetermine how similar or dissimilar the partner is thatyou're going to partner with. Clearly, as I feel theconcerns of employees, the concerns are minimized whenthe partner that you're getting is very much like you.418In areas where it's dissimilar, I think a lot of theseissues bubble up around just uncertainty and aretranslated into problems of job security...Particularly in joint ventures when groups of employees aremerged into the venture from the parent firms as at OCG, one wouldexpect employees to more readily adjust to the JV corporate culturewhen parents with similar norms and values join together. Forexample, both Olin and CIBA-GEIGY have a history of supportingemployee contributions through well-developed reward and benefitprograms. Not only did parent value similarity facilitate thecreation of HR policy for the JV in this area, but it also reducedthe adjustments required of employees in order to fit into the newsystem. In a broader sense, norms related to the level of employeeinvolvement would operate in a similar fashion. For example, ifemployees from a high involvement environment are merged into a JVwhere employee participation is relatively limited, employeedissatisfaction is bound to be greater than if employees arereinstated into an environment with which they are more familiar.Alternately, when the intents or corporate initiatives of theparents are dissimilar, employees may be confused regardingexpected behaviors or values as they operate in the venture.Related to such corporate disparity, one associate at Triaddescribes,The problem we're finding out, you have the Japanesemanagement on one side, the Spartica management on theother, and they don't communicate and so what comes downto you are two different views of the same thing...TheJapanese expect you to do a good job. And you don't havethat same expectation with the American managers. They[the American managers] seem to manage through threats.Where the Japanese seem to say 'this is your job. Itneeds to be done'.Not only are employees uncertain regarding organizational419priorities, but a further consideration is how loyalty within theJV may be fractured as a result of obvious differences in parentnorms or values. Although this was not the case at Triad, when themajority of employees in an international venture identify with theparent from the same national or corporate culture, managers fromthe second parent may be at a distinct disadvantage gainingcommitment from the workforce.Already summarized, and therefore only briefly mentionedagain, the parent with primary responsibility for management in theJV is in a position to broadly influence the corporate culture andHRM practices which operate in the venture. This may occur in theform of adoption of parent newsletters in the venture, or trainingemployees with parent materials in a parent training facility, forexample. The arrangement of locating JV employees in a parentfacility can contribute to divided loyalty between the parent andthe JV for that group of employees (i.e. the Ardsley group in OCG).Further, the presence of a large number of parent executivesunavoidably infused the JVs with norms and values of the parentfrom where the executives originate. Related to the development ofthe corporate values in the venture, and further, related to HRMpolicy and practice, in early JV negotiations consideration mightbe given to the implications of the assignment of the managementcontract on the development of corporate culture in the JV.Depending on the goals for the venture, there may be advantages ifboth parents contribute corporate values and expertise.Based on the exploratory results from the currentinvestigation, future research might address the followingquestions related to parent involvements in the venture:420• Under which conditions do parent firms and JV managersdecide which parent receives the management contract forthe venture and why? To what extent is the managementcontract simply given to the parent with headquarters inthe same country in which the JV is located?• Depending on the number of parent managers on site in theJV, how does this influence the development of acorporate culture which is unique to the JV, as opposedto a culture which closely mirrors that of the parent(s)?2. JV-based InfluencesModifications to the corporate culture evolved from theimplementation of proposed values and HRM policy inactual practice.In conjunction with cultural influences from the parents,managers in the JVs contributed to the development of norms,values, and practices in the joint ventures. While taking intoaccount parent goals and values, as well as employee requirements,select managers in the JVs in this study attempted to create acorporate culture to suit the ongoing needs in the JV. Forexample, at Mayo Forest Products and Optima, the JV corporatephilosophy was revised to place greater emphasis on total quality,employee involvement, and meeting customer requirements. In turn,revisions of the corporate philosophy necessitated changes in HRpolicy and practice to match new organizational requirements.Within the JV environment, the development of new corporategoals was accomplished in ways similar to those found in whollyowned companies. These strategies are well documented in the421literature on corporate culture change in organizations (Badaraccoand Ellsworth, 1989; Frost et al., 1985; Joiner, 1987; Kilmann andCovin, 1988; Kouzes and Posner, 1987; Morgan, 1988; Schein, 1984,1986; Walton and Lawrence, 1985). Related to how corporate valueswere introduced in the joint ventures in the current investigation,this included, for example:• mission statements which are unique to the JV (at Mayo,OCG, and Triad; at Optima this occurred at the plantlevel)• a vision statement which is repeated to employees throughverbal and written communication (all four JVs)• a company newsletter which focuses on JV issues andactivities (Mayo, Optima, Triad)• communication systems designed to link multiple JVlocations (OCG, Optima)• staffing which focuses on selection of employees to suitthe requirements of the venture (all four JVs)• training which is aligned to strategic objectives of theventure (all four JVs)• recognition and reward for performance which exemplifiescorporate values of quality and innovation (Mayo, OCG,Optima, and Triad for QC accomplishments)• PA which recognizes quality, teamwork and employeeinvolvement (OCG, Optima, Triad)Alternately, certain features of the joint ventures in thisstudy make the consistent communication and application ofcorporate values and norms problematic. For example, the manylocations of OCG both within the United States, as well as the422operations in Europe and Japan present some integrationdifficulties, despite specifically designed communication systemsto alleviate this situation. Also at OCG, the location of Ardsleyemployees at the parent facility limits physical access of thisgroup to the venture and its operating systems. Further, thepresence of subgroups (i.e. union-management; supervisors-production employees; R&D-production) in the ventures, each groupwith its own distinct value systems, contributes to variedinterpretations by employees of the company strategic goals.Multiple languages (especially Triad), the relatively large size ofthe company (Optima, Triad), and the level of commitment toinformation sharing and involvement (all four JVs) likewisedetermine the degree to which values and norms can be communicatedthroughout the venture.In order to create an environment in which cultural changesmay evolve, JV managers focused on instituting philosophicalchanges in practice. For example, at Mayo Forest Products andOptima plant managers mentioned they aim to \"do what they say\", andto use overt demonstrations that they desire employee involvement.Employee suggestions were used to modify operations, and somemanagers mentioned they specifically tried to reward and recognizeemployees for their contributions.As norms for expected participation shift, managers,supervisors and production employees were implicitly required toformulate new roles for themselves. As already noted, thisresulted in power shifts and some degree of personal uncertainty.However, if managers persist in the consistent reinforcement of thenorms and values of a revised corporate system, then over time one423might expect employee concerns about realized changes to eventuallybe dispelled. Open communication, training in role shifts, andreward and recognition which reinforces revised corporatephilosophies all assisted employees in the ventures to betterunderstand new operating values and requirements.3. A Role for HR ManagersHR managers can cultivate the development of the JVcorporate culture through their contributions to thecreation of revised values, facilitation of communicationand other processes, and through specific alterations toHRM practice.Based on the preceding, a role for the HR department maytheoretically function in a variety of ways. HR managers cancontribute to the development of:• Values - This implies HR managers know and understand thegoals and values of various stakeholders in the parentand JV organizations. A possible role for HR is in thedevelopment of the JV mission statement and a vision forthe JV, in conjunction with others in the venture.• Processes - HR managers might work as the \"processexperts\" and develop and facilitate formal mechanisms forcommunication (i.e. meetings, a newsletter) and informalcommunication among subgroups (i.e. between nationalcultures, union-management groups).• Technical HRM Policy - In a more traditional vein of HRactivities, HR managers are responsible for thedevelopment of HR policies and practices in the areas of424training, reward and recognition, staffing, orperformance appraisal.As noted in an earlier section, HR managers were able to dealwith the technical aspects of HRM policy development. The greatestchallenges for HR managers in this investigation centred aroundprocess issues. For this reason, some of the process-relatedissues which are relevant in joint venture firms will be brieflyelaborated. Specifically, the integration of the Ardsley employeesinto OCG, and the presence of diverse cultural groups at Triad willbe considered as examples of how HR might facilitate processeswhich lead to employee commitment to the venture.At OCG, the role of HRM related to the integration of parentsubgroups generally involves two components: 1. the development ofa positive identification by employees with the venture and, 2. thereduction of employee stress related to leaving the largemultinational with which they already identify, to joint a start-upJV about which they know little. In many ways, the formation ofJVs like OCG, which involve the combination of already formedparent groups, is very similar to company mergers. As at OCG,managers in mergers attempt to communicate relevant information toemployees related to expected changes, reduce employee stress andcreate new corporate roles and values (Marks, 1990; Marks andCutcliffe, 1988; Schweiger and Weber, 1989).Related to these concerns, the HR Director at Olin states,The key challenges are to facilitate the integration[into OCG] of these people coming in from otherorganizations. To build comraderie and team spirit. Tomake sure there is consistency in how people are treated.And I think that as rapidly as possible, to come up withprograms in terms of the development and training ofemployees.425As already discussed, the HR manager for OCG quickly set out toaccomplish these goals through interviews with Ardsley employeesrelated to their concerns, the rapid development of new HR policyin order that the Ardsley group would have an appreciation of whatthey can expect in the venture (i.e. related to benefits), and theinclusion of Ardsley staff in training programs and other JVactivities. The above practices were instituted in order to morequickly integrate the Ardsley group into the new venture.Alternately, some HR-related processes were problematic foremployees, and perhaps deserve further attention by managers orresearchers as to their merits. These processes include the nobid-back policy, temporary housing of JV employees in the parentfacility to which they originally belonged, and the \"no choice\"assignment to the venture. Although these conditions may have beennecessary to make the JV viable in the early stages of operation,in terms of the development of committed participation to theventure, the value of these actions is less certain. Related tothese issues, future research might consider:• What are the consequences for JV employees who arereassigned by the parent from the security of a largemultinational corporation into a start-up joint venture?Research issues might include motivation, personalsecurity, concerns related to physical relocation, andhow allegiance to the JV for reassigned employees mightbe established.• How do staffing policies between the JV and the parentsinfluence the degree to which employees feel allegianceto the venture? More specifically, the merits of long-426term leasing to the JV versus permanent reassignment, a\"no bid-back\" policy to the parent, and forcedassignments to the JV might be considered.At Triad, part of a process-related role for HR managersrevolves around the reconciliation of various subgroups in the JV.These groups included union-management, HR-production, and Japaneseand American employees in the plant. As HR managers noted, part oftheir role is to \"balance\" concerns of the various groups. To someextent HR managers gained support by \"selling\" HR policy prior toits implementation, and through training managers in new HR policy.In these ways, managers and other employees in the JV have anopportunity to contribute to the creation of corporate values asreflected in HR policy, and to gain a fuller understanding of theimplications of various practices in training sessions.Theoretically, mutual support between diverse groups might havebeen built through frequent formal meetings, and through informalcontacts as part of a coalition-building process (Kanter, 1989).However, at Triad, a coalition strategy was complicated bydifferences in group priorities, and to some extent to an absenceof trust. These differences are exemplified, for example, in howunion and management view the \"paid time off\" policy, or the amountof overtime which the HR versus production departments feel isappropriate for employees.Further, as already elaborated, American managers at Triadwere not likely to be included in meetings with their Japanesecounterparts, when vital information regarding the direction forthe plant was shared. This form of \"selective participation\"occurred in all areas of plant activity, including the HR427department. In this latter instance, HR managers noted their roleas active contributors had been limited in instances when exclusionfrom mainstream strategic operations occurred. Ideally, as part ofa process role, the HR department might create communicationsystems in which both Japanese and American managers are activeparticipants. However, a prerequisite consideration is how thenorms underlying communication between the American and Japaneseemployees in the plant might first be explored. For example, areJapanese managers aware of the impact their informal meetings haveon the constriction of information to American managers? To whatdegree are American managers dissatisfied with the process as itcurrently exists at Triad? Upper management support for new normsfor communication may be a step toward building new communicationnetworks in the venture. As process agents, the HRM departmentcould feasibly have a role in initiating such action.4. A Process Design for HRMAn important role for HRM in joint ventures concerns thefacilitation of processes which link the JV and parents,multiple JV locations, and functional units andorganizational subgroups within the venture.As evident in the preceding discussion, a process role for HRMhas many facets. HR systems which informed and linked employeesboth in the joint venture (horizontally and vertically), andbetween multiple locations (locally and internationally), appearedto be important to employee understanding of corporate, and morespecifically, of HRM initiatives. By way of summary, a processdesign for HRM is described in Table 12. This format outlines428suggested levels of involvement for HRM, and provides some examplesof processes which operate at each level based on informationprovided from the international joint ventures in thisinvestigation. More specifically, HRM practices are identified tooperate 1. between the JV-parent related to managementcoordination, permanent reassignments of parent employees to theJV, and temporary transfers; 2. at various JV locations; and 3.within the JV. The processes which operate in internationaljoint ventures might further be considered related tocommunication, training and staffing, in particular. At alllevels, the importance of developing communication networks andstrategies is central to HRM processes. In several instances,communication is enhanced though training programs. Further,selection of staff with exemplary personal and technical skillscontributed to effective organizational functioning. Figure 1provides an outline of JV core process requirements as well asinternational process requirements. JV core requirements areimportant at all levels of the operation, and internationalrequirements are especially relevant in the JV-parent relationshipand in international JV operations. Given the importance of HRMprocesses in joint venture firms as demonstrated in this design,one might expect a process focus to be a fundamental component inhow HRM operates in successful joint venture firms.TABLE 12A PROCESS DESIGN FOR HRM IN JOINT VENTURESLevels^ Processes1. JV-Parenta) management coordinationa) permanently reassignedemployeesc) temporary transfers- facilitation of contributions of both parents (ifrelevant) through communication networks or 'ohpostings in the parent companies- adaptation of HR policy from the parent(s) for theJV, or the creation of new policy for the JV basedon input from multiple sources in the JV and in theparents- solicit feedback on needs and transfer concernsearly establishment and clear communication of HRpolicy which balances employee security and JVrequirements for stability (i.e. carry over ofbenefits, bid-back to parent policy)development of an understanding of the JVenvironment for transferred employees throughorientations and training- creation of conditions of commitment and trust wheninformation is readily shared between the JV andparents- staffing to promote communication across languagesand cultures (i.e. interpreters for the transfer oftechnical expertise; \"liaisons\" who possessbicultural skills)TABLE 12 CONTINUED2. Multiple JV Locationsa) locallyb) internationally- development of mechanisms for information exchange(i.e. meetings, written correspondence)- facilitation of interpersonal contacts via \"world-wide\" meetings and teleconferences training in language skills and cross-culturalskills, and international management skills3. Within JVa) horizontalb) vertical- communication^across^various^units^(i.e.R&D/manufacturing; HR/production) through cross-team coordination (i.e. cross-departmental teamsand task groups) and team trainingcreation of open communication between managers,supervisors, and production staff in which there istrust and a willingness to deal with \"real issues\";training in role shifts and interpersonal skills- development of a union-management contract whichpromotes mutual involvement in activities as wellas reciprocal trust and respectJV CORE REOUIREMENTS431Communication - open and multiple forms ofinformation exchange- HR policy based on multiplestakeholder inputs- cross-team coordinationTraining- team building andinterpersonal skillsStaffina- good personal andtechnical skillsINTERNATIONAL REOUIREMENTSCommunication - international tele-conferences & meetings- staff exchanges- interpreters- dealing with transferconcernsTraining- language, cross-culturaland internationalmanagement skillsStaffing- international experience- cultural \"liaisons\"- for transfer of technicaland/or management skillsINTERNATIONALLOCATIONS(JV-PARENT;INTERNATIONAL JVOPERATIONS)MULTIPLE LOCALJV LOCATIONSWITHIN JVFIGURE 1A MODEL FOR IJV COORDINATIONAND PROCESS DEVELOPMENT4325. Questionnaire Outcomesa) Possible Incompatibility Between Policy and Practice:A strong emphasis on production and innovation inorganizations may be incompatible with corporate normswhich focus on human resource considerations.The scores on both the MSQ and the Culture Inventory provideinformation as to how employees view the JV corporate culture, andtherefore the values and norms which they perceive to operate inthe companies in which they work. Considering the MSQ, in all fourJVs employees reported an overall high level of job satisfaction,and high scores for intrinsic satisfaction with respect to jobvariety and autonomy. Somewhat puzzling are the consistently lowerscores for extrinsic job satisfaction. Related to extrinsicsatisfaction, employees reported they did not like the way companypolicy was put into place, perceived supervisory performance to beinadequate, and were not praised for high work standards. Insupport of these results, on the Culture Inventory as well,employees in all four JVs reported that \"group culture\" wasweakest, therefore indicating a minimal emphasis on humanresources, loyalty and tradition. Of interest, these findings seemcontrary to stated JV intentions related to a focus on employeeinvolvement, and subsequent rewards and recognition forperformance.Considering this apparent contradiction, there are multiplepossibilities which deserve speculation. First, informationprovided by respondents (mostly managers and supervisors) ininterviews may tend to overstate the company position on employeeinvolvement, and the importance paid to various HRM activities such433as reward or recognition. This is certainly not a generalizablefinding however, and based on observation and on interviews withproduction workers, there was alternately some indication highemployee involvement systems operated in reality, reward andrecognition were actually given, and efforts were made by managersto create a positive work environment for employees.Second, there is a clear indication in all joint ventures, theprimary focus in the JV is dedicated to production and innovationdemands. Related to this fact, it may be too much emphasis onproduction goals may have long-term detrimental effects onemployees, and subsequently influence employee perceptions of howthey are treated in the organization. For example, long shifts andheavy production schedules may result in physical and emotionalstress for employees, or excessive time away from families. Thepotentially detrimental effects of a strong corporate focus onproduction were manifested in each JV in this study. Morespecifically, in all four JVs, some production employees workedmultiple shifts when manufacturing operations were escalated. Inaddition, managerial or technical staff worked long hours to keeppace with the demands of reorganized product and employee systems.In all of these instances, one might expect employees to questionthe relative value placed on human resources in relation toproduction and customer requirements. Further, as work schedulesbecome heavier, time available for supervisors to praise and offerother forms of recognition to employees became more limited.Finally, employee involvement in meetings and other activitiesrelated to the continuous improvement process was curtailed.434b) A Rational Culture OrientationIn successful, globally competitive joint ventures, thereis evidence of a rational culture which emphasizesachievement, goal and task accomplishment, andproduction.The results of the Culture Inventory indicate that in all fourJVs in this investigation a rational culture, which focuses onproduction, achievement and task accomplishment, is predominant.In Mayo Forest Products, OCG and Optima there is likewise evidenceof a developmental culture, indicating a secondary emphasis oninnovation and creativity. These results might be considered toreflect how employees perceive the priorities of four successful,globally oriented firms to operate. The data from thisquestionnaire form an interesting contrast to earlier research byYeung, Brockbank and Ulrich (1989), who also used the CultureInventory to determine corporate culture orientations, but in alarger sample of companies.To elaborate, Yeung, Brockbank and Ulrich (1989) investigatedHR practices related to organizational culture in a sample ofFortune 300 companies in the late 1980's. Yeung et al. foundhierarchical cultures were strongest in forty-four percent of thecompanies. Further, based on the theoretical model which underpinsthe Culture Inventory, (described in Appendix 9) the companiestended to be both internally focused and control oriented. Yeunget al. (1989:11-12) wrote,Businesses with rational cultures are not identifiable inthis study. Businesses in every [culture] cluster havemoderate scores on rational economic orientation. Thismay be due to the fact that rational cultures areessential for survival in a competitive economy.435In contrast to this earlier finding, all four JVs in this studyoperate with a predominantly rational culture; three of the JVsalso have evidence of a developmental orientation. This implies,again based on the model, that in companies with rational-developmental cultures there is an external focus and anorientation which has dual elements of flexibility and control.This represents a significant difference from the hierarchicalorganizations which Yeung et al. (1989) found to be in the majorityseveral years ago.Given the small sample size of four in this investigation,generalizations about a new form of corporate culture inprogressive organizations in the 1990's is not possible. However,the consistency of the evidence of a rational culture in all theJVs in this study suggests further research in this area may bewarranted. For instance, has there been a systematic shift incompetitive companies to focus more on external demands? In theJVs in this investigation, numerous pressures exist for thecompanies to extend beyond their own boundaries to deal withcustomers, outside sourcing of materials, or parental demands. Tobe competitive, these JVs, without exception, focus on quality,responsiveness, and cost requirements. These demands are directlyrelated to the maintenance of rational control (i.e. goalaccomplishment), coupled with flexibility (i.e. innovation andpeople/product responsiveness). To what extent these valuecouplings occur in a larger sample of companies would beinteresting to discover.436B. Organizational Learning1. The Context for LearningLearning in joint ventures occurs at three levels: 1.related to the parent-parent or parent-JV goals andexpectations for the venture, 2. in administrative areaswhich include policy changes, and 3. related totechnology sharing and technical innovations. The keysto organizational learning are staffing, communicationand training.As part of the corporate culture, organizations may haveestablished norms for learning at strategic or tactical levels.Learning may be considered to operate on three levels:1. Partner learning - The parents and the JV are in a positionto learn about each other in relation to strategic goals andrequirements. Goals and expectations of managers in theparents and in the venture are likely to change as part of anevolutionary process. For example, as the JV demonstratessuccess, the parents may decide greater autonomy for the JV iswarranted. In another example, one parent may decide itsinitial goals in the JV are not attainable, and may eitherreadjust expectations, or reorganize its involvement in theventure.2. Administrative learning - In quickly changing environments,and in response to altered strategic initiatives or changes inorganizational values and norms, administrative and policychanges are inevitable in progressive organizations. In thejoint ventures in this study, and specifically related to HRM,437policy was changed in response to employee and JVrequirements. For example, a shift toward greater employeeinvolvement necessitated the creation of HR policy in theareas of reward and recognition to encourage involved,committed employee participation.3. Technological learning - Except at Mayo Forest Products, theJVs represent an opportunity for the parents and JV to learnfrom one another in technology-related areas. At OCG andOptima this takes the form of value-added technologicalaccomplishments. At Triad, Japan Motors provides technicalexpertise to JV employees; in addition Spartica had hoped tolearn from exposure to the methods and practices of theJapanese partner.In each case, learning is more likely to be facilitated whenthere exists openness, trust, permission for reasonable risk-takingas a prerequisite for innovation, and when there is support andtolerance for multiple values and perspectives. As the strategicobjectives or national cultures which are present in internationaljoint venture firms become more widely divergent, a focus onlearning and mutual support are likely to become even morecritical.Further, to summarize, the keys to organizational learning inthe present investigation centre around the following:• Staffing - High calibre, flexible staff were requiredwith exemplary technical and personal skills. Stafftransfers occurred as a means of exchanging technologicalor managerial expertise.• Communication - An emphasis on communication in the JVs438and between the JV and the parents, facilitated thetransfer information, and importantly built trust throughthe longer-term establishment of interpersonal networks.• Training - For all staff, training and skill acquisitionwas a priority. In each JV training was wide-based andavailable.Alternately, the absence of certain values or conditions curtailedthe potential for learning to occur. These omissions include: ageneral absence of international experience in the executive suite;a lack of cross-cultural competencies (especially among Americanmanagers); limited training related to parent or JV corporateculture, cross-cultural skills, or negotiation and conflict-resolution; and heavy production schedules which restrictedtraining time available for production employees.2. Partner LearningGoals and expectations between the parents and betweenthe parents and JV are bound to change over time. Thisnecessitates a process in which the partners buildrelationships and establish channels for communication inorder that they may continue to learn about each other.In international ventures, willingness by the partners in theventure to learn about one other is an important component ofcollaboration. This includes both learning between the parents,and learning between the parents and the venture related to tasks,goals and expectations. In early JV negotiations, specific partnergoals are usually determined. For example, one partner may begiven the marketing responsibility for the venture, the other439partner may supply raw resources. However, over time the originalresponsibilities or expectations of the partners may begin toshift. To elaborate, at Mayo Forest Products after ten years ofpartnership, the parents recognized a refocusing and separation ofthe parent roles was required. Both Canadian Pacific ForestProducts and Mitsubishi set out to redefine their involvement inthe JV, and to determine each partner's expectations as part of thereorganization plan for the mill. Alternately, without ongoingattention to changed requirements, and willingness to alter valuesand priorities as a consequence, JV partners may eventually findthat initial strategic goals are no longer in alignment.Doz and Schuen (1991: 14-15) suggested \"the importance andnecessity of developing, building and continuing learning about thepartner's organization, culture and ways is underestimated ascompared to other types of more explicit and measurable learning\".Further, insufficient learning among the partners may be a hiddencause for venture failure. Related to this possibility, greaterattention might be focused on the parent-parent or parent-JVrelationships. The development of norms for information exchange,joint communication networks, and specific mechanisms for conflictresolution when normal communication channels falter may all beimportant to continued JV success. In the JVs in this studycollaboration was nurtured through the JV board structure andadvisory committees, other formalized meetings, and throughinformal contacts between executives.4403. Administrative LearningTo keep pace with strategic demands in the organization,ongoing change to HR policy is required.As technical demands change, and as parent involvement orcontrol in the venture is modified, original JV management systemsare likely to become obsolete. As already explained, externaldemands which were largely market driven formed the impetus forchange at Mayo Forest Products and Optima. Also at Mayo ForestProducts, parameters for management involvement were revised as theparents redefined their roles and responsibilities in the venture.Related to the JV management contract, one might expect that as thejoint venture matures, changes in parent involvement will lessen.In each of the above cases, policy changes are likely to berequired to match new conditions in the organization. Morespecifically, and as already outlined, HRM policy did change tokeep pace with revised strategic demands. Further, HR managersselectively contributed to the creation of HR policy which supportsorganizational learning through programs which include:• Verbal feedback to employees for ideas or suggestions,and an effort by managers to implement employeesuggestions in practice (all four JVs)• Recognition programs for employee efforts andaccomplishments (Mayo, OCG, Optima); Triad recognizes QCperformance; Optima has an \"Inventor of the Year\"; Mayohas a quarterly award for the employee who makes the\"biggest mistake\" related to experimentation-based effort• Financial awards (OCG and Optima have cash bonuses fortechnological and commercial accomplishments)441• Hiring well educated personnel with broad-based abilities(all four JVs)• Training which focuses on broad skills with an emphasison quality and innovation (all four JVs)• Transfers of employees between the parents and the JV isone way in which management and technological expertiseis transferred to the venture (Optima, Triad)• Performance appraisal which considers innovativecontributions (Optima, Triad)In addition to the above characteristics which are apparent inseveral of the JVs in this investigation, other conditions whichwere thought to contribute to a \"learning environment\" werementioned by managers or production staff. At Mayo Forest Productsthe placement of limited controls on managers seemed to beimportant. This permits managers to experiment and try newmethods. At Mayo, OCG and Optima direct contacts between employeesand customers to determine required product or service improvementsfacilitated innovation and learning.4. Technological LearningStaffing and training are vital to the creation of value-added technological achievements.Although various HR-related strategies contribute toinnovation and learning in joint ventures, in the JVs in this studystaffing and training related to technological learning are ofparticular importance. In the area of staffing, transfers ofpersonnel contribute to the introduction of necessary skills to theventure. Senior parent executives were transferred to the JV from442the parent, with the specific goal of bringing technicalproficiencies with them. For example, at Optima, the VP of CableTechnology is from Bauer and was responsible for the introductionof essential cable expertise to the venture. In addition, largenumbers of technical staff are transferred to the ventures in orderto introduce new technical skills into the JV. At Triad, forexample, Japanese technical assistants on temporary assignment fromJapan Motors train production workers in Japanese manufacturingmethods. Further, counterbalanced staffing between Japanese andAmerican executives at Triad is another mechanism through whichmanagers can exchange technical (and administrative or cultural)knowledge. In fact, this arrangement may be one way to fosterlearning between culturally diverse managers, especially wheninformal norms for communication (i.e. meetings among Japanesemanagers and technical assistants in the absence of Americans) mayotherwise limit learning experiences in which both American andJapanese managers can participate.Training is likewise a priority in the JVs and generally wasconsidered to contribute to the level of technological learning.Related to this focus, training is readily available for all levelsof staff. At Triad, JV staff received training in Japan, as wellas from Japanese on assignment in the venture. In addition, cross-training occurs at Optima and Triad; job rotation operates atTriad. Staff placements into cross-functional teams and taskgroups as at OCG serve to create a broader technical learning basebetween the research and manufacturing arms of that operation.443C. National Culture1. National Culture and HRM Policy and PracticeHRM policy and practice will more likely be acceptable toJV participants when it is sensitive to variations andpreferences related to national culture.At Mayo Forest Products, OCG and Optima, there is relativelylittle evidence HRM policy was adapted to suit the national cultureof the off-shore participants in the venture. In each of theseventures, HRM policy either paralleled HRM policy in the Americanparent, or was created specifically for the JV. In either case,policy was created which is suitable for the largely Americanproduction and managerial workforce. Although this arrangement didnot seem problematic due to the relatively small percentage offoreign parent employees in each venture, there was some indicationat Optima that some of the employees from Bauer were not totallycomfortable operating under reward and appraisal policies whichthey considered to be \"American\" in orientation. Although it maybe unrealistic for HR policy to take into account the special needsof small groups of transferred employees, there may be value in thecommunication of HR goals and philosophies to individuals who arenot familiar with systems adapted from the American parent. AtOptima, for example, the HR department did provide an orientationto Bauer employees related to the venture operations and specificHR policy initiatives.In this study, Triad is a good example of a venture in whichthere is significant influence from the off-shore Japanese partner,coupled with input from American managers hired directly to the JV.444In addition, there is a minimal degree of involvement from theAmerican parent. In the venture, HR policy and practice drawsheavily on Japan Motors preferences for manufacturing andmanagement style, but it is modified to suit the expectations andpreferences of a basically all-American production workforce.Alternately, when worker expectations are not met, this may be thecause for policy revision. For example, American productionworkers at Triad would like to see a policy implemented whichrecognizes superior employee performance. Despite the sentimentsof Japanese managers against such policy, the HR department iscurrently reviewing the creation of policy in this area related toemployee demands and expectations.2. Cultural RelativityCultural differences are represented in \"shades of gray\"rather than in absolute terms.An interesting finding which developed from the investigationat Triad is that some Japanese managers, as well as some of theAmerican managers, did not view their respective cultures as widelydivergent. Managers generally preferred to consider that bothsimilarities and differences exist between the national cultures ofthe United States and Japan. This sentiment is contrary to popularopinion that these cultures are vastly diverse. Further, Japanesemanagers noted a generalization of management practice which is\"Japanese\" in orientation is false, and that commonalities existbetween Japanese and American management styles, or betweenJapanese or American managers and workers.To elaborate, a Japanese Vice-President at Triad commented,445I don't really know what is the Japanese managementsystem that many people talk about, you know. Somepeople may say that it's lifetime employment, orconsensus management, but it is not new or unique toJapan. It is also in America. In Japan, lifetimeemployment is not necessarily so.Related to these remarks, it is possible many of the acceptedconcepts of what comprises Japanese work orientations or practicesmay be overstated. For example, a Japanese and an American managerwho work together at Triad both responded differences between thecultures of the two groups have been exaggerated. In the area ofplanning, for instance, the Japanese manager remarked although theJapanese as a whole are considered to be good long-term planners,some Americans excelled as long-range planners, and alternatelysome Japanese did not.In addition, a senior Japanese manager at Triad commented itis false for Americans to assume Japanese employees work primarilyfor the intrinsic satisfaction of accomplishing a job. He added inJapan, employees work hard because they are actually striving forbetter jobs or salaries. However, because time frames foraccomplishing goals are longer, employee motivations may not betransparent to an external observer. This same manager suggestedalthough there is a collective or \"group\" philosophy which operatesto some extent in Japan, there is also considerable emphasis on theindividual and individually-oriented criteria. He stressed tomotivate employees, (either in Japan, or when working with Japaneseemployees outside Japan), managers often offer individualencouragement. In his view, a distinction operates: in Japan a\"group philosophy\" applies when employees consider their allegianceto the company, however the treatment of employees is on a more446individual basis. As a further example, a Japanese managerexplained contrary to popular belief, Japanese do not avoidconflict at all costs, and may commonly have what he termed\"business fights\". On a subtle level, much depends on the contextin which these discussions occur. Open discussion with one's bossoccurs in certain circumstances, but conflicts are likely to beavoided when \"outsiders\" are present.Related to the importance of context, previous research hasconsidered the relative determinants of conflict management inU.S./Japanese joint ventures (Mendenhall and Black, 1990). Morespecifically, depending on the organizational or social situation,the appearance of harmony was more important than the actualabsence of conflict. Other specific analysis of social andcontextual situations as enacted by members of cultural groups,either in joint ventures or in other settings, is likely to be afruitful avenue for future research. A deeper understanding ofculture as it operates in international organization is most likelyto evolve as general cultural categorizations are replaced by anexamination of the more subtle features which influence individualand group interaction.4473. Interaction of National Culture, Corporate Culture andStrategic OrientationIn joint venture firms, diversity related to nationalculture may be moderated by complementarity andconvergence of the corporate culture and strategicorientation of the parents. Demonstrated capability fororganizational learning in the JV and in the JV-parentrelationship may further enhance positive outcomes in theventure.The joint ventures in this study are either 50/50 or 60/40equity partnerships. In each case, the partners are from differentnational cultures. Somewhat puzzling, the influence of nationalculture was not strongly felt in three of the four ventures; nordid it appear to be a major contributing factor to either positiveor negative outcomes in the JVs in this investigation. (Consistentwith earlier definitions, positive outcomes are gauged related toproduct success and employee job satisfaction). This is aninteresting finding, given the emphasis in the literature on theimportance of national culture in organizations and the often citeddifficulty of bridging cultural differences (Baird, Lyles andWharton, 1989; Peterson and Shimada, 1978; Phillips, 1989; Tyebjee,1991).Building on the results of the current investigation, but alsospeculating beyond the data, it may be possible the impact ofnational culture in joint ventures may be moderated by otherfactors such as:•^the complementarity or similarity of the parent strategicgoals or orientations448• the complementarity or similarity of the parent corporatecultures• a capacity for learning in the JV-parent relationship atpartner, administrative and technological levels.Although strategic goals and the corporate culture are interrelatedand therefore difficult to separate, in this context a slightdistinction is suggested. The strategic orientation refers to theidentified focus or goal toward which managers strive (i.e. highquality products, low costs). The corporate culture refers here tohow the strategic objectives are to be accomplished related tooperating norms and values (i.e. employee involvement, rewards forinnovation).Considering the above proposition, the importance of nationalculture related to management practices (Hofstede, 1980; 1990;Laurent, 1986) is not meant to be diminished. Rather, thepossibility is suggested other conditions related to corporateculture, strategic orientation, and organizational learning mayform relevant context conditions for how joint venture firmsoperate despite differences in national culture.Further, there is support for this theory in the literature.For example, Killing (1983) found none of the joint ventures in hissample failed due to differences in national culture. However, twoof twelve venture failed due to \"differences in corporatepersonality\". In other work, Dymza (1988) found factors which ledto JV failure included different goals of the parents; perceptionsof unequal costs and benefits; or conflicts over decision-making,managerial processes and corporate values. More recently, Parkhe(1991) speculated complementary resources between the parents and449a capacity for organizational learning may overcome differencesrelated to different national operating styles and cross-culturaldifferences. However, to date research to specifically test thispossibility has not been initiated.Related to the preceding, in the current project at MayoForest Products, OCG and Optima there were no major problemsrelated to the combination of diverse national cultures in theventures. Although the national culture of the parent firmsdiffer, alignment between the parent strategic orientations andcorporate cultures generally does exist. For example, at MayoForest Products, OCG and Optima both sets of parents tend to focuson HR activities, and have similar norms for how work is to beaccomplished. Likewise, there are agreed upon strategic goalsbetween the parents related to their respective responsibilities inthe venture. Further, in these JVs there is a focus onorganizational learning. As already discussed in earlier sections,the ability to learn provides the JV and the parents with thecapacity to revise strategies and tactics as new information isreceived, or when operating contingencies alter.The situation at Triad is less clear. Certainly there is ahigh degree of cross-cultural \"mixing\" between the groups involvedin the venture. However, in addition, there is less consistency inthe corporate norms and strategic objectives between the parentfirms. Although there is a focus on organizational learning in theventure, there has been less opportunity for Spartica to learn fromJapan Motors than the American parent had originally hoped.Learning was curtailed when several of the Spartica managersreturned to the parent from the venture early. Related to the450present considerations, it would be interesting to see whetherSpartica would have remained in the JV had there been a greaterdegree of alignment between the corporate culture and strategicgoals of the parent firms.Drawing on the literature to date, and based on speculationrelated to the inconclusive data provided in this investigationrelated to the interaction on national culture with corporateculture or strategic firm orientation, it is possible that ininternational joint ventures:• If the parent firms have a similar corporate orientationand strategic focus, and organizational learning isimportant to both the JV and parents, then positiveoutcomes in the venture are more likely despitedifferences in national culture.Alternately,• If the parent firms have a dissimilar corporateorientation and strategic focus, and organizationallearning is not important to the JV and parents, thenpositive outcomes in the venture are less likely when thenational culture of the parents are either dissimilar orsimilar.These propositions are obviously extreme points on a continuum. Itwould be expected intermediate positions exist. For example,parents may have similar corporate cultures related to how theyinvolve employees in the JV. Yet despite corporate complementarityrelated to employee involvement, unaligned strategic goals (i.e.concerning product development or profit expectations), may createirreconcilable differences which eventually lead to problems in the451JV, regardless of national culture considerations.In addition, the above picture may be further complicated bythe degree to which the involvement by the parents is shared, orwhether the JV operates under the influence of one parent, orautonomously. In the JVs in this study, in the value-addedventures (OCG, Optima) a more shared role operates between theparents than in either Mayo Forest Products or Triad, where parentroles are relatively specialized and separate. Adding this pieceto how joint ventures might operate, a further proposition mightinclude:• As national cultures of the parent firms become morediverse, and as the degree of shared managementinvolvement by the parents in the joint ventureincreases, then similarity in the parent corporatecultures and strategic orientations will be prerequisitesto positive outcomes in the venture.The proposed relationship among these factors is represented inFigure 2.Related to limited empirical investigation to date as to hownational culture may be moderated by other factors such ascorporate culture, strategic orientation or level of organizationallearning in international joint ventures, further research in thisarea appears warranted. The propositions outlined here may form aninitial point for further conceptual and empirical development inthis area.452 HighLevel of SharedInvolvement byJV Parents*Medium****Low^Medium^HighNational Culture Diversity*** represents: Similarity of Parent Corporate Cultureand Strategic OrientationFIGURE 2THE RELATIONSHIP BETWEEN PARENT INVOLVEMENT,NATIONAL CULTURE, AND SIMILARITY OF PARENT CORPORATE CULTUREAND STRATEGIC ORIENTATION453D. AN INTEGRATIVE FRAMEWORK FOR STRATEGIC HRMIN INTERNATIONAL JOINT VENTURESThe intent of the project was to provide detailed informationof how HRM operates at Mayo Forest Products, OCG, Optima, andTriad. HR policies and practices were described in each jointventure, as well as processes related to the implementation ofstrategic HRM. More specifically, in chapters nine and ten theanalysis and discussion highlighted: the management to the JV-parent relationship; HR policy and practice as it operates in theJVs; and an integrated view of HR in international JVs related tocorporate culture, national culture and organizational learning.Based on the results of this investigation, it is possible topostulate a preliminary framework for how strategic HRM operates ininternational joint ventures. Drawing directly on the previouschapters, strategic HRM is considered with respect to planning,communication, staffing, reward and recognition, training andperformance appraisal. In each case, how HR policy and practiceoperates appears related to various \"context conditions\" (i.e. theJV-parent relationship; the extent to which HR and companystrategic objectives are integrated; corporate culture and nationalculture; and whether or not there exists a focus on organizationallearning). These conditions reflect the potential complexity ininternational joint ventures, and further, suggest an especiallybroad and complicated role for HRM in which internal and externalenvironmental demands are balanced with HRM policy and practicerequirements. Structural, strategic and cultural components areconsidered.To elaborate, a framework for strategic HRM in joint ventures454is presented in Table 13. Context conditions (along the top of thetable) are shown in relationship to the HR practices identified inthis project. For example, in the top left-hand corner planning isconsidered with respect to the JV-parent relationship. The pointslisted in this cell, as well as the others in this table indicatesome of the central considerations in international joint venturesas they have been observed in the JVs in this investigation. Theitems listed in Table 13 represent a graphic summary of thematerial which has been presented in previous chapters.The information presented in each cell relates to the four JVsin this investigation, and therefore most closely represents howHRM operates in globally-oriented manufacturing operations in whicha focus on TQM prevails. However, given the relative consistencyof the results in the JVs, the framework is believed to havebroader applicability subject to further confirmation in futureresearch. More specifically, HR practices are considered inrelation to:1. JV-Parent Relationship - The relationship between the JV andparents represents both structural and strategiccharacteristics of how the JV is managed. For example,whether the JV is specialized or value-added, and how themanagement contract is assigned have implications for HRpolicy and practice. The definition of parent roles,establishment of trust between JV and parent representative,and the integration of groups and locations are relevantconsiderations.TABLE 13A FRAMEWORK FOR STRATEGIC HRM IN INTERNATIONAL JOINT VENTURESJV-ParentRelationship Integration ofHRM and Strategy CorporateCultureNationalCultureOrg.LearningPlanning * complementaryparent goals* managementcontract* use of parentresources* awareness ofJV and parentobjectives* earlyinvolvement* financial andstaff resources* similarparentcultures* integrationof parentgroups to JV* defined HRvalues/goals* policywhichconsidersculturalnorms andvalues* learningatpartner,admin.,andtechnicallevelsCommunication *trust-building* link multiplegroups andlocations* informationto employeesrelated toJV objectives* companyvision/values* norms forinformationexhange*language*interactionnorms*integratenetworks(verticalandacross)Staffing *2-way transfer*influence fromparent staff* high calibreof staff* broad skills(personalandtechnical)* to createallegianceandflexibility* balancedbetweenparentexecutives* toexchangeexpertiseA FRAMEWORK FOR STRATEGIC HRM IN INTERNATIONAL JOINT VENTURES (CONT.)JV-ParentRelationship Integration ofHRM and StrategyCorporateCultureNationalCultureOrg.LearningReward/Recognition* multiplereward systems* executivereward tiedto JV success* for JV-parentcooperation* relatedtoJV specificgoals* meaningful* reinforcesvaluedbehaviors* reflectsnormsandvaluesof themajorityof staff* forinnovationandcreativityTraining *internationalmanagement* intercompanydynamics* wide-based* readilyavailable* commitmentof time andfinances* JV cultureandenvironment* externaltraining maynot socializeto JV norms* language* nationalcultureof parents* extensive* forrisk-takingandteamworkPerformanceAppraisal * goals forintercompanyexchanges andcontributions* evaluateperformancerelated tostrategic goals* for salariedand productionstaff* createdfor JV vs.adopted fromparents* simple* inputfrommanagers* trainingprovided* forinnovation* focuson staffdevelopment& trainingneeds4572. Integration of HR and Strategic Planning - In competitiveorganizations such as those in this project, ideally there isa strong link between the firm strategic objectives and HRpolicy and practice. Strategy is proposed to respond to bothinternal and external requirements of the firm (Pettigrew,1985) and is translated into various HR practices. In orderto form realistic linkages between strategy and HRM, managersare aware of both JV and JV-parent strategic objectives.3. Corporate Culture - The corporate culture norms and values inthe venture support the strategic ojectives of both the JV andthe parent firms.^Consistent with Schuler (1992) HRactivities can contribute to the establishment of the firm'sstrategic direction, especially when HR policies are developedand implemented which are compatible with the corporateculture.4. National Culture - Related to variations among nationalcultures (i.e. Laurent, 1986), the presence of differentnational cultures in the venture suggests consideration forcultural norms and values in the development of HR policy andpractice.5. Organizational Learning - Reflected in both firm strategy andcorporate culture, a capacity for learning at theorganizational level is increasingly important to firmflexibility and survival (Doz and Schuen, 1991). Learningoccurs at partner, administrative and technological levels.Further, and considering the framework as presented in Table 13,strategic HR activities are expected to vary in each joint venturewith reference to the preceding five considerations. For example,458in the present investigation due to the presence of diversenational cultures in the plant at Triad, managers developed\"hybrid\" HR policy and \"counterbalanced staffing\" between Americanand Japanese executives. Alternately, the development of a JVcorporate culture was a more pressing issue at OCG, when in thestart-up venture effective integration of parent employeesrepresented a primary consideration. Further, depending on arequirement for organizational change or renewal, the focus onorganizational learning related to company strategic objectives islikely to vary. At both Mayo Forest Products and Optima,reorganization plans were initiated in 1988 in response to arequirement for enhanced competitiveness in the global arena. Asa result, HR policy was significantly modified in keeping with anew strategic direction which focused on TQM achieved throughemployee involvement.These examples illustrate joint ventures have ongoing needsfor flexibility and adaptability in response to both internal andexternal operating conditions. In the present framework a widevariety of conditions are outlined under which HRM operates and towhich managers are required to respond. Based on the currentinvestigation, in international joint ventures as well as in otherforms of organizations, simple policy applications of HRM arelikely to be inadequate. Instead, a fuller understanding ofstrategic HRM necessitates a multidimensional model whichencompasses structure, strategy and culture related to HRoperations. As evident in the joint ventures in thisinvestigation, this further suggests a dual capacity forflexibility and control. Specifically in the area of human459resource management, definition of policy and practice exists, butnot without the simultaneous capacity to make adjustments asstrategic or cultural needs change over time and situations. Basedon this challenge, the process role for HRM in joint venturesbecomes critical in order to both assess organizationalrequirements and facilitate the implementation of new HR policy asrequired.460E. RESEARCH ISSUESI. Strengths of the InvestigationAccording to Shenkar and Zeira (1987), human resourcemanagement in international joint ventures has historicallyreceived limited attention. The current project has addressed thistopic at two levels. First, the investigation provides adescription of the technical aspects of HRM as they operate in fourjoint ventures related to planning, communication, reward andrecognition, staffing, training and performance appraisal. Second,the study has contributed to a better understanding of processissues related to HRM. In particular, strategic HRM has beenconsidered with respect to: the parent-joint venture relationship;how HRM can operate strategically to fulfil the goals andobjectives of the parents and venture; issues related to nationalculture and corporate culture; and finally how an emphasis onorganizational learning can contribute to JV and parent operations.More specifically, the present investigation extends the workby Schuler and Jackson (1987) and others concerning strategic HRMin wholly owned companies. Consistent with Schuler (1992), HRmanagers can play a role in charting the strategic direction forthe firm, identify HR philosophy or culture which is consistentwith the firm strategic objectives, and develop and implementpolicies, programs and practices to support the corporate culture.However, the current research further provides information onstrategic HRM but in the context of international joint ventures.In addition, this investigation extends work by Cascio and Serapio(1991) and Pucik (1988) in IJVs through the elaboration of a461process-oriented role for HRM.The framework suggested in Table 13 both evolved from thecurrent investigation and is based on previous work in the areas ofinternational JVs (Collins and Doorley, 1991; Lei and Slocum,1991); strategic HRM (Schuler, 1991; Tichy, 1988); corporateculture (Schein, 1984), national culture (Laurent, 1986; Schneider,1988), and organizational learning (Doz and Schuen, 1991; Parkhe,1991). This theoretical frame assists to identify centralconsiderations in each area of HR policy development, and iscomprehensive with reference to the context conditions which mightaffect how HR policy and practice operates.Further this project supports the supposition by Frayne andGeringer (1989) concerning the potential for influence in the JVdepending on which parent has the management contract and isresponsible for the organization of HR activities. In addition,the current investigation elaborates how HRM might function relatedto whether JVs are specialized or value-added. These are all newand relatively unexplored areas in the literature on jointventures, and contribute to how strategic HRM operates in jointventure firms.The method used for the collection of data is a strength ofthe investigation. The format is multi-method and allows for datafrom various sources to be cross-referenced. Interviews wereconducted with employees at multiple levels in the organization(i.e. managers, supervisors, production staff). This arrangementis important in order to gain an understanding of the variousperspectives which operate in each JV. Employee views differedconsiderably, depending on one's position in the company. The462interview format was open-ended, which allowed respondents tointroduce issues which they felt were important related to HRM ininternational joint ventures. As a consequence, a variety ofunique issues emerged from the data collection process, whichotherwise would not have been evident.The instruments used in this investigation have merit insimilar future research. The Guide for Human Resource ManagementPractices was developed specifically for this project and resultsfrom the inventory are consistent with interview and other datasources. Data obtained on the Minnesota Job SatisfactionQuestionnaire are also consistent with other sources. The CultureInventory developed by Quinn and others is new and little used todate. However, the questionnaire is easy to use, is not timeconsuming, and seemed to accurately reflect the corporate culturesof each of the companies in this study.2. Limitations of the InvestigationThe current research has a sample size of four. Although thisallows for the intended depth in understanding of various strategicHRM processes, the small number of companies participating in theproject limits the generalizability of the results. For thisreason, a similar research format which considers HRM ininternational joint ventures is recommended in a broader spectrumof companies. In this instance, the research could moresystematically look at how HRM practices in international JVs varydepending on for example: company size, age, location, parentcultures, unionized or not, and industry focus. In the presentsample, all JVs are in the manufacturing sector and have a similar463strategic orientation. Two companies are relatively large, and twoare small. Two JVs are unionized and two are not. Two of theventures are between North American and Japanese parent firms; twoare between a North American and either a German or Swiss parentcompany. The results of the current investigation would bestrengthened based on an extension of the results in a largercross-section of international joint ventures.Further, all joint ventures in this project have beenrecognized by external sources for product and service excellence.On the Minnesota Job Satisfaction Questionnaire, the sample ofemployees who were surveyed in the ventures indicated a relativelyhigh level of job satisfaction. Again, in order to extend thepresent results, a similar investigation might include JVs which ona continuum represent differing degrees of product success andemployee satisfaction. This may serve to provide a morecomprehensive explanation of which HRM policies and practices workwell, and which are problematic related to JV strategic objectivesand employee satisfaction. In addition, the JVs in thisinvestigation are all based in North America, although they mayhave operating sites or marketing facilities in other countries.A further extension of the research is to include JVs which arebased outside North America.Finally, considering the role which the researcher plays inthe investigative process, there are advantages if a multinationalresearch team (rather than a single investigator) were to collectdata in a similar project. Investigators who are from the samenational cultures as represented by the parent companies couldfeasibly facilitate data collection as a result of language skills,464and indepth knowledge of the values and operating norms as theyexist in the relevant national culture groupings.465F. TOWARD THE FUTURE:SOME PERSONAL SUMMARY COMMENTSJoint ventures are neither a new phenomena, nor are they\"trendy\". In recent years the number of joint ventures hasdramatically increased, often related to external pressures placedon companies if they are to succeed in relation to other globally-oriented competitors. Joint ventures are one mechanism by whichmultinational companies can expand in a world where there areinternational trading blocks (i.e. Far East, Europe, and NorthAmerica), and increased requirements to be \"close to the customer\"in various country locations, for example. In response tointernational challenges, the parent firms in this study havejoined together to share risks or technology, and to be betterpositioned to create and market innovative, high quality, costefficient products.Despite evidence of a previous escalation in joint ventureactivity, one might expect the number of joint ventures to increaseto an even larger extent in the future. For example, in theexpanding markets of Central and Eastern Europe, joint ventures arerapidly on the rise. In that region, Hungary has the largestnumber of JVs. At the end of 1989, 1590 joint ventures operated inHungary (11% of all companies); by the end of 1990, 5000 jointventures were in operation, which represents 35% of all companies(Csath, 1991). Further, in the wake of a new trade agreementbetween the U.S., Canada, and Mexico, recent joint venture activityalong the Mexican border with the U.S. may also continue toescalate, as investors seek viable partnerships, and entry to newmarkets.466In the joint ventures in this investigation, importance isattached to HRM activities which match the strategic requirementsof the organization. Poised in a position to work with managersand other employees, HR staff crafted policies in the areas ofcommunication, staffing, training, reward and recognition andperformance appraisal which meet evolving technical and employeeneeds. The HR role is especially complicated in joint ventureswhen multiple national and corporate cultures are present, and whenvarious operational sites require integration.The issues which have been considered in this investigationare relevant to a sample of joint venture firms located in NorthAmerica. However, given the uniqueness of joint ventures, furtherresearch is needed to expand knowledge of how joint venturesoperate in the context of other national locations, and whendifferent social, cultural and political systems prevail. In thisvein, an interesting area for future investigation is how jointventures operate in countries such as China or Poland - wherespecial challenges exist for managers related to, for example, howa local workforce unfamiliar with a market economy might bemotivated and rewarded.Although joint ventures are often considered in relation tothe advantages they offer for international competitiveness andfinancial returns, there may also be less tangible benefits fromthe formation of such partnerships. For instance, in internationaljoint ventures between partners from diverse national culturesopportunities for cultural learning and exchange may result. Inaddition, joint ventures can also provide a vehicle by whichcapital and technical skills can be transferred into countries467(i.e. in Central or Eastern Europe) where newly emergingdemocracies are struggling to stabalize. Long-term committedparticipation by the partners to the venture, rather than short-term and quick-gain involvements, will most likely result in JVsuccesses and provide benefits to the local economy and itsworkforce during periods of social, economic and politicalstabalization.Based on first-hand observation of HR practices in jointventures in Hungary, but equally applicable to other settings,Csath (1991:89) concludes:Human relations are going to be the key strategic issuesin joint ventures. Those who understand this will beable to build healthy and long-lasting relationships,because of their focus on the 'invisible assets' of everyquality-oriented organisation: human beings - theirknowledge, creativity and commitment.Great opportunities for technical and personal developmentexist in international joint ventures. There also exists an equalchance for frustration and failure. 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Unpublished Ph.D. dissertation:University of California at Los Angeles.APPENDIX 1478LETTER SENT TO JOINT VENTURES WITH THE ATTACHED PROJECT OUTLINEdateDearI am writing to you to request the participation of in a research project which focuses on strategic human resourcemanagement policy and practice in international joint ventures.This area is of contemporary significance, and the results of thisstudy will have practical importance for managers.Despite recent attention to joint ventures as an importantstrategy for global competitiveness, little research exists as tohow joint ventures operate. This is especially apparent in theareas of human resource management and strategic managementpractices. For these reasons, I am conducting indepth studies ina small sample of successful joint venture companies. The enclosedproject outline provides detailed information as to the specificaims and objectives of my study. This research is in fulfilment ofmy Ph.D. requirements at the University of British Columbia atVancouver, where I am specializing in international managementissues. For your further information, I have also included a briefbiographical sketch outlining my relevant background andexperience.I would very much appreciate your participation in thisproject. I believe the operating knowledge of managers and otherstaff at can provide an essential contributionto understanding how international joint ventures successfullyfunction. The results of the study will contribute to forming animportant foundation upon which a more comprehensive understandingof international joint ventures can be built.My investigative approach goes well beyond superficialanalyses of how joint ventures operate, and uses multiple forms ofdata collection and interviews at various levels of theorganization. I would like to emphasize that I have designed thestudy such that it entails a minimal amount of your staff time, andwill not interfere with normal operations. All that is requiredare one or two interviews per individual.479480I will publish the results of this research investigation inan academic journal. As each company has been selected for itsexemplary management practices, I hope to be able to identify eachcompany by name. However, if desired, the participating companiesand individuals have the option to remain anonymous. It isimportant to emphasize that the focus of this research is onstrategic and human resource management. Consequently, there is norequirement for information pertaining to the financial status ofeither the venture or the parent companies. Further, there is norequest for monetary support from participating companies.Should you have any questions related to this proposal, pleasedo not hesitate to contact me at the fax or telephone numbers notedbelow. I hope that you will respond positively to this proposal.I believe the results of this study will be of significant use toyour organization, as well as to the academic and businesscommunities.Sincerely,Dianne CyrTel: (604) 683-2414Fax: (604) 224-8489AN ASSESSMENT OF THE DEVELOPMENT AND APPLICATIONOF HRM POLICY AND PRACTICE IN INTERNATIONAL JOINT VENTURESDianne CyrIntroductionThis research is focused on how human resource management(HRM) policy and practice are developed and implemented insuccessful international joint ventures. In the broadest sense ofthe term, HRM in this instance refers to the planning, staffing,training, appraisal and reward systems which are applied toemployees in joint venture firms. This also includes theinvestigation of strategic management practices, conflictresolution strategies, and the various communication mechanismswhich operate in international joint ventures and which contributeto their success. In this study the term joint venture representscooperative and strategic alliances formed as the result of twointernational companies venturing together to form a third,independent company which is jointly owned and managed.BackgroundRecently, both the popular and academic literature haveincluded references to the importance of understanding howstrategic human resource management practices operate ininternational joint ventures. Of note, a special issue ofManagement International Review (1990) has been devoted to thistopic. Further, in his latest book The Borderless World, Ohmae(1990) stressed the need to study intercompany (his italics)relationships, especially in the context of joint ventures andalliances in today's global environment. Understanding strategicHRM in international companies is likely to be an importantcomponent in creating progressive and competitive firms which aresensitive to the needs of a diversified and often multiculturalworkforce. Despite these calls for research on the subject, todate very little information is available related to the unique andcomplex issues managers face in alliance companies. The proposedresearch is a contribution toward addressing how HRM operates onboth a strategic and tactical level in international jointventures.481482Research ObjectivesDue to a lack of prior information as to how human resourcemanagement strategies operate in joint ventures, the presentresearch is exploratory. The objectives of this research include:1. To determine how and why various HRM and strategicmanagement practices have evolved and to understand howthese processes operate and are unique in internationaljoint ventures. The project seeks a fuller comprehensionas to which strategies (i.e conflict resolution strategies,communication mechanisms, career pathing formats) areutilized in order to accommodate the complex needs ofglobally oriented corporate relationships.2. To consider the benefits and difficulties of operating HRMpractices in complex international alliances.3. To develop an understanding of how HRM can contribute tocreating more flexible, innovative and competitiveorganizations.4. To obtain a measure of employee satisfaction in eachcompany studied, and to explore employee perceptionsrelated to the existing corporate climate in each firm.Plan of the ResearchData collection is estimated to occur between April to August1991. The project is to be conducted as an indepth analysis of asmall sample of international joint ventures. It is anticipatedthat I will spend approximately two weeks in each company. Itshould be noted however, that the time involvement of individualstaff members will be minimal and is unlikely to exceed oneinterview.The plan of the project is as follows:1) Establish a contact person within the company.^Thisindividual will assist in identifying documentary materialsappropriate to the study, and will help in the selection ofinterview respondents.2) Written documents will be gathered and analyzed to providea) background information on the company, b) information onHRM policy and practice in the areas of planning, staffing,training, performance appraisal and reward, and c) datarelated to management's strategic initiatives. Documents tobe reviewed may include annual reports, mission statements,policy reports, HRM manuals, minutes from meetings.3)^Time will be spent observing operations and procedures. Thiswill involve the observation of daily routines and managementpractices.4834) Interviews will be conducted with managers and other staff atmultiple levels in the organization. A tentative list ofrespondents includes:general managersenior manager of HRM1 other HRM officer1 operating manager/supervisor (i.e. production)1 technical-level employee (i.e. engineer)1 line executive (i.e. marketing, finance)1 line worker1 union official (if applicable)5) A questionnaire measuring employee satisfaction and corporateclimate will be administered to a small number of employees(35-40). Administration time is approximately 10 minutes.6)^Following the analysis of the data, the findings of the studywill be shared with management. The results of the study asthey relate to HRM and strategic management within each jointventure will be discussed.March 1991APPENDIX 2LISTS OF EMPLOYEES (BY TITLE) INTERVIEWED IN EACH JOINT VENTURE484Employees Interviewed at Mayo Forest ProductsGeneral ManagerPersonnel and Safety Administrator (plant level)for unionized staffPersonnel Officer (at parent company)for salaried employees at MayoProduction SuperintendentSuperintendent Maintenance and EngineeringControllerProduction and Sales CoordinatorFiling SuperintendentMechanical SupervisorProduction SupervisorResource (Training) Center CoordinatorExecutive SecretaryUnion Representative (Past Plant Chairman)Male Production WorkerFemale Production WorkerConsultant (involved in the Mayo reorganization)Executive Vice-President in the Japanese parentExecutive Vice-President in the Canadian parent485Employees Interviewed at OCG MicroelectronicsWest Patterson Headquarters OfficeJoint Venture PresidentHuman Resources ManagerVice-President Finance and AdministrationProduct ManagerEast Providence Manufacturing FacilityDirector, Research and DevelopmentPlant Manager for ManufacturingResearch Manager, Research and DevelopmentProduction ManagerTechnical ManagerProduction SupervisorProduction WorkerLiaison with Fuji-HuntOtherDirector, Research and Development (Ardsley)Vice-President Human Resources for CIBA-GEIGY U.S. (Hawthorne)Human Resources Director ( Electronic Materials at Olin)486Employees Interviewed at OptimaHeadquartersVice-President PersonnelManager of Employee RelationsPersonnel ManagerVice-President and Director Cable TechnologySenior Vice-President, Cable DivisionVice-President and General Manager, Cable DivisionDirector, PlanningManager, Engineering ServicesDirector, MarketingTraining DirectorPlant 1Personnel ManagerTraining CoordinatorTeam Project Manager (Production)Female AssociatePlant 2Plant ManagerPersonnel ManagerTraining CoordinatorGeneral ForemanDepartment Head (Connectorization)Male AssociateOtherProject Staff, Cable Process (transferred from Bauer)Project Staff, Product Development (transferred from Bauer)487Employees Interviewed at TriadJapan Motors DispatcheesHuman Resources Executive and Corporate SecretaryGeneral Affairs ManagerAssistant General Manager, Human ResourcesAssistant to the Executive Vice-President ManufacturingSpartica DispatcheesGeneral Manager, ManufacturingFinance Executive Vice-President and TreasurerAssistant General Manager, Production EngineeringAssistant General Manager, ManufacturingTriad EmployeesGeneral Manager, Human ResourcesBranch Manager, General AffairsEmployee Relations ManagerTraining Specialist, Human ResourcesPersonnel Administration ManagerBranch Manager, Quality CirclesManager, Body EngineeringBranch Manager, Service PartsGroup LeaderChairman of the Union Bargaining CommitteeFemale AssociateMale Associate488APPENDIX 3SCHEDULE FOR DESCRIPTIVE COMPANY INFORMATION489Schedule for Descriptive Company DataGeneral• Age of company• Reason for JV formation and how the venture wasinitiated• Number of employees in the JVManagement Systems• Corporate objectives and company mission of the JV andthe parent firms• Degree of centralization of the venture• Leadership style in the venture• Historical data (i.e. how management goals, systems orstructures have evolved and changed over time)• JV Board structure490APPENDIX 4ANNOTATED BIBLIOGRAPHIES OF COMPANY DOCUMENTS491492Annotated Bibliography of Documentsfor Mayo Forest Products1. Master Agreement for IWA2. Employee Handbook - Lists information on the history of MayoForest Products, the safely program, quality control, andother information on the mill process.3. Five Year Strategic Plan - The contents include informationon fibre supply, markets, operations overview, project scope,the five year capital plan, site plan, proposed mill layout,quality and development and economic justification. Thegoals and objectives of the company are outlined.4. Resource Centre Information - An abstracted version of someof the training focus and procedures which Mayo ForestProducts is in the process of implementing.5. A Cut Above - An article published in the November 1990 issueof the Globe and Mail Report on Business Magazine outliningthe performance-based, employee involvement programsoperating at Mayo Forest Products.6. The Mayo Update (January, February, March, April 1991) - Themonthly published company newsletter. The newslettertypically has a safety update and statistics, productionresults, accident free achievements. Messages andinformation are supplied from the personnel/safelydepartment; quality control; maintenance; production; andfiling. The newsletter ends with a saying and birthdays forthe month.7. Mission statement, philosophy statement, definition ofquality and total quality control activities list, qualityresults list.8. \"Managing for Performance\" - An address Mike Low, the generalmanager presented in Oregon. The speech primarily coveredthe elements of the high performance system operating at MayoForest Products. It outlined the process of developing sucha system i.e. establishing a vision, developing a missionstatement, defining key success factors, and goal setting toaccomplish desired results.9. Address to the Japan Futures Reception at the Coast BastionInn at Nanaimo. The address refers to the productionprocesses and focus of the mill.10. Canadian Pacific Forest Products Limited Annual Report (1990)11. Focus ( A profile bulletin of Mayo Forest Products, July1989). Briefly presents production and market information493related to Mayo Forest Products.12. Mayo Forest Products Limited: Quality People, QualityProduct - A glossy picture magazine depicting the company andits people.13. Weekly Management Meeting Handout (April 16 and April 23) -Given out in the management meeting, each manager provides apage of update for the operations of the current week.14. Personnel Stats on absenteeism - Lists budgeted and actualabsenteeism figures as well as activities targeted to improveabsenteeism results.15. 1991 Canada Awards for Business Excellence Application - Anoutline prepared for the quality category. The applicationoutlines business background, quality improvement policy andplan, information of the implementation and operation of theplan, and results achieved.494Annotated Bibliography for OCG Mictroelectronics1. Press Kit - Included in the kit are a variety of news releasesdescribing the nature of photoresists and polymide materials;background on OCG including company objectives and the structure ofthe company;^background information on key executive staff;remarks on OCG from the JV president Jim Favier; remarks of EdwardPollak, Senior Vice President for Olin Corporation, the OCGmanagement structure.2. The Olin Hunt Employee Handbook - The handbook is also given tothe employees of OCG and covers the company history and philosophy,the work environment, and benefits.3. Total Quality Management (TQM) Manual : Improving PersonalQuality - The handbook describes the goals of \"Improving PersonalQuality\" and the employee's role in this process.4. Managing Total Quality (An Olin publication.) - The manualelaborates the total quality process and how this process might beaccomplished. [Select pages have been reproduced.]5. Performance Management Process - (An Olin Chemicalspublication.) - The manual presents a step by step process forperformance review.^This includes worksheets for an initialmeeting betwen the supervisor and the employee, a job descriptionform, a planning and review meeting worksheet, and an updateexpectations worksheet. Also included are a sample of generalknowledge and skill areas that might be considered in theperformance management process. [Select pages have beenreproduced.]6. The Ciba-Geigy/Olin Hunt Microelectornics Joint Venture BusinessPlan. The business plan includes the vision and concept for thejoint venture. Also outlined are markets and competition, researchand development plans, organization of the joint venture, and salesand marketing strategy. [Select pages have been reporduced.]7. Images (the Olin Hunt and OCG newsletter) - Copies of issuesfor December 1990 to May 1991. The publication is monthly anddetails business issues and employee activities and accomplishmentsboth in the Olin businesses and at OCG Microelectronics.8. Olin Personnel Policies - Table of Contents outlines the list ofHR polices included in the manual.9. Olin Job Information System (Introduction) - Presents thepurpose, procedures and guidelines for recruitment and selection.10. Organizational Chart for OCG Microelectronics49511. OCG Mictroelectronic Materials, Inc. Short-term ManagementIncentive Plan - The plan outlines the administration, eligibilityand design of an incentive plan for OCG.12. Proposal for Group Move from Ardsley to E. Providence -Outlines some of the stategies planned prior to the relocation ofArdsley employees.13. Recommendations for Employee Rocognition Programs at OCG - Theprogram recommendations focus on both individual and teamachievement in the areas of a) performance/special achievement andb) technological/commercial achievements.14. Employee Attitude Survey at East Providence - The surveyoutlines the identified problems and subsequent recommendationsbased on the survey of employees conducted by Maida Garabed, HRmanager, at the East Providence site.15. Special Achievement Program Policy Statement - The policy isstated and a \"Quality Award Employee Nomination Form\" is included.16. Quality Awards Policy Statement - The policy is stated and a\"Recommendation for Special Award\" form is included.17. Newsletter for the Rhode Island site - This is the firstinformal newsletter printed by the employees at East Providence.18. Certificate of Recognition - Blank copy.19. Absenteeism Statistics for 1990 and 1991.20. New Hire Safety Orientation - An outline of various safetyitems which are covered in the orientation of new employees.21. Sample job description for an employee of the packagingdepartment at the East Providence facility.22. Ciba-Geigy pamphlet briefly outlining the company vision andleadership objectives.496Annotated Bibliography for Optima Corporation1. Optima Code of Conduct - This pamphlet briefly outlines theQuality Policy for the company, the company's responsibilities toemployees, the expected employee commitment to the company, thepersonnel focus, a variety of issues related to corporate security,conflict of interest, use of company funds, and compliance to lawsand acts.2. Optima - A description of company focus and products.3. Fiberop Annual Report (1990)4. Organizational Chart for the Personnel section under theresponsibility of the manaager for employee relations - Members ofthe personnel department are listed as well as their respective jobduties.5. The Tieline (the company newsletter) - Issues forOctober/November 1990 and January/February 1991.6. Employees: A Self-Directed PD&R Guide - The guide is foremployees to assist them to prepare for the performance reviewprocess. A variety of worksheets are included that form the basisof the appraisal and which are reviewed jointly by the employee andhis or her supervisor. This format is used with managerial,administrative and technical staff.7. Optima Managerial/Individual Behavior Inventory - The inventoryis intended to supplement the annual Performance Development andReview.8. Optima Plant Hourly Review Summary and Recommendations forAction - A one-page performance review form used for hourly planemployees.9. Clown Around with Praise - A bulletin for employees explaininga peer recognition program for individual employees at Optima.10. Correspondent - A one-page news and information updatepublished daily for Optima.11. Plant 1 Mission Statement12. Training and Development Manual - The manual lists recommendedcourses in various job areas, as well as brief outlines of some ofthe courses.13. Optima Interview Response Form - An interview form used for theselection of Administrative, Technical and Managerial staff.14. Quality Seminar Manual - Outlines the principles and actionsteps required for the quality process.49715. Design Team Proposal - A report prepared by the committeedesignated to investigate the implementation of the team concept atPlant 2. The report considers environmental, technical, and socialelements of the proposed plan. Various team options are exploredwith a proposal outlined for the option of choice.^Variousrecommendations for the implementation of teams at Plant 2 arediscussed.16. Team Member Training (Sessions 1 and 2) - The training packageconsiders various managerial and interpersonal skills necessary foreffective results using the team concept.498Annotated Bibliography for Triad1. Triad Corporate Philosophy - The corporate mission statement.2. Employee Handbook - The handbook outlines various employmentpractices and guidelines for personal conduct at work.3. The collective bargaining agreement between Triad Motors andthe UAW. Of interest in the agreement is the focus on the tenetsof Japanese management practice as practiced by both the companyand union interests in the agreement. This includes a minimalnumber of job classifications, flexibility in job assignments andjob transfers, associate training, harmony among the associates,and the use of Kaizen and the Team concept.4. Performance Planning and Review - A one-page performancereview form used for the evaluation of managerial staff.5. Triad Quality Circle Group Leader/Unit Group Leader QualityCircle Activity Guidebook - The guidebook outlines the purpose andobjectives of quality circles as well as the keys to conducting theQuality Circle process. Detailed information is presented relatedto the initiation, implemention and evaluation of the qualitycirles. Forms used in the quality circle process and examples ofquality circle presentations are included.6. Triad 7 Tool Quality Circle Training Manual - An indepth manualdescribing the 7 tools of quality circles as part of the datagathering process. The 7 tools are cause and effect diagrams,histograms, checksheets, pareto diagrams, scatter charts, graphs,and control charts. This training is provided to all associates atTriad.7. Triad Motors Advnaced SPC Manual - An advanced training manualof statistical analyses for use in the quality circles.8. Training Plan (July 1991-June 1992) - A list of courses offeredmonthly, as well as additional courses provided to employees atTriad. The total number of employees in training each month isalso listed.9. Outline of Triad Motors - An abbreviated listing of the historyand benchmarks for Triad beginning in 1985.10. Triad Employee Survey Report - The report is the summary ofresults of a survey at Triad conducted by researchers at a localuniversity during August and September 1989. Information collectedincluded socio-demographic data, economic and occupationalinformation, worker migration patterns to the area and theirexpectations about the community, and employee attitudes toward thework environment at Triad with a focus on attitudes related toJapanese culture, technology and management practices.49911. Triad News - A sample of the monthly newsletters published atTriad. Issues range from June 1990 to July 1991.12. Quality Circle News - A newletter published with a specialfocus on quality circle issues.13. Triad Motors - A glossy magazine published outlining key factsand figures about Triad. Numerous pictures depict themanufacturing process and featured car models.APPENDIX 5PARTICIPATION CONSENT FORM500501CONSENT FORMConsent to participate in the project\"An Assessment of the Development and Application ofHuman Resource Management Policy and Practice inInternational Joint Ventures\"Dianne Cyr^ Peter FrostResearcher Thesis Advisor(604) 224-8489 (604) 224-8384Purpose: The project aims to gain an indepth understanding of howhuman resource management practices are developed and applied toemployees in international joint venture firms. In this study,international joint ventures refer to strategic and cooperativealliances formed between two international partners. Humanresource practices related to planning, staffing, performanceappraisal, training and reward systems will be considered.Procedures:^The researcher will individually interviewparticipants in this study.^Each participant will likely beinterviewed once, although multiple interviews may be conducted toverify or confirm information. The interview will be audiotapedand will probably last in the general range of two hours.Questions will relate to human resource management practices in thejoint venture. The researcher is available to answer any enquiriesrelated to this project.Confidentiality:^All individuals have the option of strictconfidentiality and no names are required. Only the researcher andher thesis advisor will have access to the tape-recordedconversations. You may, however, choose to include your name as arespondent in the study. Please check your desired option:^ I wish to remain anonymousMy name may be used with reference to statements I make.Right of Refusal: All individuals have the right to refuse toparticipate in the study and may withdraw at any time.^Anindividual's decision to not participate in the project will in noway affect employment status.Consent: The signature below acknowledges consent to participatein the project and the receipt of a copy of the consent form.Participant's SignatureAPPENDIX 6GUIDELINE QUESTIONS FOR HRM POLICY AND PRACTICE(VERSIONS FOR HRM AND NON-HRM STAFF)502503Guideline Questions on HRM Policy and Practice*(for HRM Managers and HRM Personnel)Background Questions• Explain the HRM role in this company. What exactly do you donow? What would HRM like to do?• What are the unique issues HRM faces in alliance firms? (i.e.cultural, political, technical)• How can HRM assist in dealing with these unique challenges?• What are the necessary skills, knowledge and abilities for asenior manager of HRM? other HRM personnel?• Within the HRM mandate, who initiates policy? practices? changes?INTRODUCTION1. Overall, to what extent has HRM policy and practice changedover time? Describe. Why did these changes occur?2. Which HRM policies operate most successfully? Why? Whichpolicies are problematic? Why?PLANNINGIn your view, what are the key planning issues related to HRM? 3. When is broad policy for HRM in the IJV established?4. Is HRM planning linked to the overall business plan? How?5. Is there consensus among the HR management team concerningessential strategic objectives? Explain.6. To what extent does the IJV plan HRM policy independently ofthe parents?7. Are the objectives in the IJV the same as those of theparents, or different? If the objectives are divergent, howare they developed into a set of consistent criteria for HRMplanning and systems in the company?• These questions serve as a guideline for interviews. Numberedquestions will be used by the researcher as prompts for additionalinformation, as required.504Guideline Questions continued...How are the needs of different groups of employees accommodated? 8. Are there HRM practices in place for accommodating diverse(cultural) needs of employees in the IJV? If so, have thesepractices changed over time?^Is cultural sensitivitydemonstrated in employee/management behaviors? Are the sameHRM policies applied to all IJV employees? Explain.Are there mechanisms for building trust between employees andmanagers? Explain. 9. Is information shared among IJV managers amd employees? Ifinformation is shared, how much? content?^When ismiscommunication most likely?10. Are there mechanisms for facilitating communication andcollaboration between management and employees of the IJV?(i.e. task forces, steering committees, transition teams,information sharing sessions). If so, when are they formed?membership? Are there meetings? newsletters?How are conflicts resolved when they arise? 11. Who in your group (or in the organization) is involved inproblem-solving?STAFFINGHow are staffing decisions made (for managers and workers)? 12. How was the general manager chosen? the senior manager ofHRM? other managers? (when?)13. Which positions were filled from each parent? (generalmanager, chief financial officer, technical directors,department heads) How are the different management rolesassigned?14. Are the same selection criteria used for all managers andemployees? Describe.15. Which qualities are valued in managers? workers? (i.e.analytic ability, interpersonal skills, flexibility, culturalsensitivity, language skills) Evidence?16. To what extent are expatriate managers used? Is loyalty to theIJV problematic?17. What are the rules for intracompany job transfers?18. Who makes staffing decisions? (i.e. are employees ordepartment heads involved?)505Guideline Questions continued...PERFORMANCE APPRAISALDescribe the performance appraisal process. 19. What is the purpose of appraisals? (ie. developmental,remedial, maintenance)20. What actions are taken based on the appraisal?21. Who provides the appraisals? Who is appraised?22. What kind of rating criteria are used in appraisals (i.e.interpersonal skills, contribution to team effort etc.)23. How often are appraisals performed?24. Is the same appraisal process applied to all managers andemployees?25. Are cultural factors taken into account?TRAININGHow are training programs developed and implemented? 26. What is the focus of training? (i.e. job content, problem-solving, cultural, communication skills) What are the valuescommunicated?27. Who provides the training? (parents, IJV)28. Who develops the training packages?29. What is the format for training?30. Is the aim to transfer \"know how\" from the parent to the IJVor the other way?31. Are training programs culture-specific or multicultural? Aredifferent courses offered for employees from differentcultures?32. To what extent is job retraining done?PROMOTION AND REWARDHow are promotions awarded? 33. What is the basis for promotion? (seniority, ability) Why?34. Are promotion criteria the same for all employees?35. Is career path information available? Are bulletins featuringpromotion/hiring information visible?36. How many people were promoted last year?506Guideline Questions continued...How do compensation systems operate? 37. What is the objective of rewards? (i.e. to attract, motivateor retain employees)38. To what extent are employees involved in creating their owncompensation packages?39. Are the same reward systems applied to all employees?Is there a perception of equality or inequality of rewards?Explain.40. Are key employees in the IJV on the parent's payroll? Who arethey?41. Are bonuses (or career paths) tied to the attainment of IJVlong-term objectives? Explain.42. Are there incentives for learning new skills or behaviors?OTHERWhat are the major challenges to IJV managers? Are experimentation and creativity encouraged in the IJV? How? Is there anything else that should be added in order for me tounderstand how HRM policy and practice operates? 507Guideline Questions on HRM Policy and Practice*(for Non-HRM Managers and Staff)Background Questions• Explain the HRM role in this company.• What are the unique issues HRM faces in alliance firms? (i.e.cultural, political, technical)• How can HRM assist in dealing with these unique challenges?INTRODUCTION1. Overall, to what extent has HRM policy and practice changedover time? Describe. Why did these changes occur?2. Which HRM policies operate most successfully? Why? Whichpolicies are problematic? Why?PLANNINGHow are the needs of different groups of employees accommodated? 3. Are there HRM practices in place for accommodating diverse(cultural) needs of employees in the IJV? If so, have thesepractices changed over time?^Is cultural sensitivitydemonstrated in employee/management behaviors? Are the sameHRM policies applied to all IJV employees? Explain.Are there mechanisms for building trust between employees andmanagers? Explain. 4. Is information shared among IJV managers amd employees? Ifinformation is shared, how much? content?^When ismiscommunication most likely?5. Are there mechanisms for facilitating communication andcollaboration between management and employees of the IJV?(i.e. task forces, steering committees, transition teams,information sharing sessions). If so, when are they formed?membership? Are there meetings? newsletters?* These questions serve as a guideline for interviews. Numberedquestions will be used by the researcher as prompts for additionalinformation, as required.508Guideline Questions continued...How are conflicts resolved when they arise? 6. Who in your group (or in the organization) is involved inproblem-solving?STAFFINGHow are staffing decisions made (for managers and workers)? 7. How was the general manager chosen? the senior manager ofHRM? other managers? (when?)8. Are the same selection criteria used for all managers andemployees? Describe.9. Which qualities are valued in managers? workers? (i.e.analytic ability, interpersonal skills, flexibility, culturalsensitivity, language skills) Evidence?10. Who makes staffing decisions? (i.e. are employees ordepartment heads involved?)PERFORMANCE APPRAISALDescribe the performance appraisal process. 11. What is the purpose of appraisals? (ie. developmental,remedial, maintenance)12. What actions are taken based on the appraisal?13. Who provides the appraisals? Who is appraised?14. What kind of rating criteria are used in appraisals (i.e.interpersonal skills, contribution to team effort etc.)15. How often are appraisals performed?16. Is the same appraisal process applied to all managers andemployees?17. Are cultural factors taken into account?TRAININGHow are training programs developed and implemented? 18. What is the focus of training? (i.e. job content, problem-solving, cultural, communication skills) What are the valuescommunicated?19. Who provides the training? (parents, IJV)20. Who develops the training packages?509Guideline Questions continued...21. What is the format for training?22. Is the aim to transfer \"know how\" from the parent to the IJVor the other way?23. Are training programs culture-specific or multicultural? Aredifferent courses offered for employees from differentcultures?24. To what extent is job retraining done?PROMOTION AND REWARDHow are promotions awarded? 25. What is the basis for promotion? (seniority, ability) Why?26. Are promotion criteria the same for all employees?27. Is career path information available? Are bulletins featuringpromotion/hiring information visible?How do compensation systems operate? 28. What is the objective of rewards? (i.e. to attract, motivateor retain employees)29. To what extent are employees involved in creating their owncompensation packages?30. Are the same reward systems applied to all employees?Is there a perception of equality or inequality of rewards?Explain.31. Are there incentives for learning new skills or behaviors?OTHERWhat are the major challenges to IJV managers? Are experimentation and creativity encouraged in the IJV? How?Is there anything else that should be added in order for me tounderstand how HRM policy and practice operates? APPENDIX 7A QUESTION GUIDE FOR THE GENERAL MANAGER510511A Question Guide for the General Manager1. From your perspective, what have been the most significantchanges in HRM policy and practice in this company? Why didthese changes occur?2. Which HRM policies operate most successfully? Why? Whichpolicies are problematic? Why?3. What are the unique issues HRM faces in IJV firms? (i.e.cultural, political, technical)4. What is the HRM role in dealing with these unique challenges?(i.e. What HRM does now versus what HRM should do)5. Are there mechanisms for building trust and facilitatingcommunication among units, managers and employees in thiscompany? If so, explain.6. How are conflicts (i.e. between units, managers, employees)resolved when they arise?7. What are the necessary skills, knowledge, and abilities for ageneral manager? senior manager of HRM? How is this differentthan in other non-IJV firms?8. In the instance when there are managers or other staff fromeach parent firm (or culture) employed in the IJV, how aredifferent management roles or task functions assigned? Explainwho performs which roles.9. Are there HRM practices in place for accommodating the diverse(cultural) needs of employees in the IJV? if so, have thesepractices changed over time? Are the same HRM policies appliedto all IJV employees? (i.e. reward structure, promotioncriteria, appraisal process, training programs, etcetera).Explain.10. To what extent is the HRM division linked to the overallbusiness operation of the firm?11. Can HRM policy contribute to enhanced learning and innovationin IJV firms? If so, explain.12. Is there anything else that should be added in order for me tounderstand how HRM policy and practice operates?APPENDIX 8INSTRUCTIONS FOR AUDIOTAPE REVIEW512513Instructions for Audiotape ReviewThe tapes have been transcribed using a format which records notesbased on the conversation with the person interviewed, as well asverbatim quotes. Quotes appear in quotation marks. Unmarked textrepresents summarized notes. Comments appearing in square brackets[] are my own thoughts or additions to the text and are notnecessarily part of the tape recordings. Rather than transcribeevery word on each tape, I have tried to capture the sense of whatindividuals are saying. In order to review the tapes you shouldhave the audiotape and a copy of the transcribed text for the sameaudiotape. It is important to note that confidentiality has beenguaranteed to individuals interviewed as well as for company names.In keeping with the above, I would ask you to review the tape(s)with the following considerations:1. Ensure that verbatim quotes are accurate. I have donesome editorialising of quotes by leaving outinterjections like ums, er, etc. and have also omittedthe odd word which may start a sentence or thought andthen is replaced by the interviewee by another sentenceor thought.2. Check that the essence of what people say is accuratelyrecorded in notes. Not every thought is necessarilyrecorded, but I have attempted to capture the sense ofwhat people are saying as it relates to the topic of thisresearch (human resource management in internationaljoint ventures). I have hoped to include importantthoughts or details. Alternately, I did not want tosummarize some detail of the tape, or to add information,in a way that it did not occur in the tape recording.Additional information or commentary that does not occuron the tape recording should appear in the squarebrackets as mentioned above.To assist in checking the accuracy of transcription of the tapes,please note errors, omissions, or additions (all as outlined above)that alter the basic sense of the text as you perceive it presentedby the individual interviewed on the tape. Your notes can be madeonto the transcribed copy you receive with the tape. When you havecompleted the review, please return the tape and the transcriptionto Peter Frost.Thank you for your help.APPENDIX 9QUINN'S TYPOLOGY OF ORGANIZATIONAL CULTURE514515The Culture InventoryThe Culture Inventory used in this research was based ontheory developed by Quinn (1984) and is related to a \"competingvalues approach to leadership\". In this model, Quinn proposes thatcompetition exists between a rational world view with a preferencefor control, objectivity and certainty and an adaptive view inwhich a preference for flexibility, and a tolerance forsubjectivity and uncertainly prevail. Other dimensions of Quinn'smodel are a preference for an internal versus an external focus.An internal focus suggests cohesion and cooperation as well asstandardization. An external component is related to an emphasison action and competition resulting in desired outcomes. Withinthis framework, and related to the cultural categories in theinventory, organizations with a group culture (internal andflexible) emphasize people, a sense of family, loyalty, traditionand human resources. Organizations in which there is adevelopmental culture (external and flexible) emphasize innovation,creativity, growth and dynamism. In a hierarchical culture(internal and control), an emphasis is placed on order, rules andregulations, formality, stability and documentation. Organizationswith rational cultures (external and control) focus on achievement,goal and task accomplishment, and production. A simplified versionof Quinn's model is diagrammatically represented in Figure 3.FLEXIBILITYGroup Culture Developmental Culture INTERNAL 11 11 111111111111111 I1111111111111111111 EXTERNALHierarchical Culture Rational CultureCONTROLFIGURE 3QUINN'S TYPOLOGY OF ORGANIZATIONAL CULTUREAPPENDIX 10EMPLOYEE CONSENT FORM AND QUESTIONNAIRES516517CONSENT FORMConsent to participate in the project\"An Assessment of the Development and Application ofHuman Resource Management Policy and Practice inInternational Joint Ventures\"Dianne Cyr^ Peter FrostResearcher Thesis Advisor(604) 224-8489 (604) 224-8384Purpose: The attached questionnaires will be used to collectinformation on how employees in international joint ventures feelabout some of the management and personnel practices operatingwhere they work. In this study, international joint ventures referto strategic and cooperative alliances formed between twointernational partners.Procedures: You are asked to complete the two short questionnairesattached. The questionnaires have no time limit but together willtake about ten or fifteen minutes to complete. Taking these fewminutes to answer the following questions will, however, greatlyassist in providing information about employee issues andimpressions in your company.Confidentiality: All individual responses on the questionnaire areconfidential and no names are required. Only the researcher willhave access to information provided on the questionnaires.Right of Refusal:^Your participation is voluntary.^Allindividuals have the right to refuse to participate in the studyand may withdraw at any time. An individual's decision to notparticipate in the project will in no way affect employment status.Consent: Completion of the questionnaire assumes your consent toanonymously participate in this project.Your participation is sincerely appreciated.518Questionnaire 1Indicate the degree of satisfaction you have with your job. Askyourself how satisfied you are with its various aspects.Use the following guide for your answers:VDS^D^N^S^VSVery^Dissatisfied^Can't^Satisfied^VeryDissatisfied Decide SatisfiedCircle one alternative for each question.1. Being able to keep busy all the time^ VDS D N S VS2. The chance to work alone on the job VDS D N S VS3. The chance to do different things fromtime to time^ VDS D N S VS4. The chance to be somebody in the community ^VDS D N S VS5. The way my boss handles his people^ VDS D N S VS6. The competence of my supervisor inmaking decisions^ VDS D N S VS7. Being able to do things that don't goagainst my conscience VDS D N S VS8. The way my job provides for steadyemployment^ VDS D N S VS9. The chance to do things for other people^ VDS D N S VS10. The chance to tell people what to do^ VDS D N S VS11. The chance to do something that makes useof my ability^ VDS D N S VS12. The way company policies are put intopractice VDS D N S VS13. My pay and the amount of work I do^ VDS D N S VS14. The chances for advancement on this job^ VDS D N S VS15. The freedom to use my own judgement^ VDS D N S VS16. The chance to try my own methods ofdoing the job^ VDS D N S VS17. The working conditions^ VDS D N S VS18. The way my co-workers get along witheach other VDS D N S VS19. The praise I get for doing a good job^ VDS D N S VS20. The feeling of accomplishment I get fromthe job^ VDS D N S VSPlease go to the next page519Questionnaire 2The following statements describe types of values which may existin your company. None of the descriptions is better than theothers. They are just different. Please indicate the extent towhich each statement applies to the company where you work.Show your degree of agreement or disagreement by circling theappropriate number as on the following scale.1Low Agreement 2^3^4^5I I I I^Moderate Agreement^High Agreement1. This company is a very personal place. It is like an extendedfamily. People share a lot of themselves^ 1 2 3 4 52. This company is a very dynamic and entrepreneurial place.People are willing to stick their necks out and take risks.^ 1 2 3 4 53. This company is a very formal and structured place. People payattention to procedures to get things done^ 1 2 3 4 54. This company is a very production oriented place. People areconcerned with getting the job done^ 1 2 3 4 55. The glue that holds this company together is loyalty and tradition. Commitment runs high 1 2 3 4 56. The glue that holds this company together is commitment to innovation and development. There is an emphasis on beingfirst with products and services^ 1 2 3 4 57. The glue that holds this company together is formal rules andpolicies. Following rules is important^ 1 2 3 4 58. The glue that holds this company together is an emphasis ontasks and goal accomplishment. A production and achievementorientation is shared^ 1 2 3 4 59. This company emphasizes human resources. Morale is important.^ 1 2 3 4 510. This company emphasizes growth through developing new ideas.Generating new products or services is important^ 1 2 3 4 511. This company emphasizes permanence and stability. Efficiencyis important^ 1 2 3 4 512. This company emphasizes outcomes and achievement.Accomplishing goals is important^ 1 2 3 4 5520Background InformationIt is important to have some information on the background of thosepeople who respond to the questionnaires. Again, all informationis strictly confidential.Age: ^ yearsSex: Male^FemaleHighest level of education ^Job title ^Number of years in this company ^Years of residence in this country ^Ethnic Origin (if born outside this country)Number of nonvacation days absent from work this year(year = one year prior from today's date)APPENDIX 11GUIDE TO HUMAN RESOURCE MANAGEMENT PRACTICES521522GUIDE TO HUMAN RESOURCE MANAGEMENT PRACTICESFor each of the following items, indicate your choice as to howyour organization operates its human resource management practices.Each item represents a continuum. Circle the spot on the continuumfor each item, which best represents your choice.For example, on the first item, planning may range from formal toinformal. If planning is very formal you would indicate this inthe following way:formal *---*---*---*---*---*---* informalIf planning in your organization is moderately informal, you wouldindicate the following:formal *---*---*---*---*---*---* informalIn some cases you may feel that elements of both formal andinformal planning apply. Mark this dual choice by circling twoseparate spots on the scale which best represents your choices.Use the following scale to indicate your level of agreement as tohow your company operates its human resource management practices.Use the \"undecided\" category only if you can really not make upyour mind regarding the answer.Agreement is:*^*^*^*^*^*^*strong moderate^slight^undecided^slight^moderate strongPLANNING1. formal and ordered *--*--*--*--*--*--* informal and flexible2. long-term focus (more than one year ahead) *--*--*--*--*--*--*short-term focus (less than one year ahead)3. group philosophy *--*--*--*--*--*--* individual philosophy4. high *--*--*--*--*--*--* low employee involvement5. low risk-taking *--*--*--*--*--*--* high risk-taking6. integrated *--*--*--*--*--*--* nonintegrated with the plans ofother departments523Guideline to HRM Practices continued...STAFFING7. internal recruitment *--*--*--*--*--*--* external recruitment8. few career paths *--*--*--*--*--*--* many career paths (i.e.employees can be promoted to a wide range of positions)9. hiring and promotion criteria are clear and stated*--*--*--*--*--*--* ambiguous and unstated10. discrimination based on gender: high *--*--*--*--*--*--* low11. discrimination based on social class:high *--*--*--*--*--*--*low12. early retirement *--*--*--*--*--*--* late retirement13. extensive overtime *--*--*--*--*--*--* limited overtime14. minimal experience *--*--*--*--*--*--* high levels ofexperience15. orientation sessions: absence *--*--*--*--*--*--* use16. career path information:unavailable *--*--*--*--*--*--* availablePERFORMANCE APPRAISAL17. behavioral criteria *--*--*--*--*--*--* results criteria18. evaluation based on:total person *--*--*--*--*--*--* performance19. criteria and goals: short-term (less than one year)*--*--*--*--*--*--* long-term (more than one year)20. group criteria *--*--*--*--*--*--* individual criteria21. employee participation: high *--*--*--*--*--*--* low22. implicit feedback *--*--*--*--*--*--* explicit feedback23. slow promotion *--*--*--*--*--*--* rapid promotion524Guideline to HRM Practices continued...REWARD24. low base salaries *--*--*--*--*--*--* high base salaries25. standard, fixed packages *--*--*--*--*--*--* flexible packages26. employment security: low *--*--*--*--*--*--* high27. few perks *--*--*--*--*--*--* many perks (financial, social)28. short-term incentives (less than one year) *--*--*--*--*--*--*long-term incentives (more than one year)29. hierarchical rewards *--*--*--*--*--*--* egalitarian rewards30. bonuses, wage increases or reductions:collectively shared *--*--*--*--*--*--* individually based31. secret rewards *--*--*--*--*--*--* open rewardsTRAINING32. long-term (longer than one year) *--*--*--*--*--*--*short-term (less than one year)33. broad and general *--*--*--*--*--*--* narrow and specific34. group orientation *--*--*--*--*--*--* individual orientation35. in-house *--*--*--*--*--*--* external36. on-the-job *--*--*--*--*--*--* classroom37. extensive job rotation *--*--*--*--*--*--* minimal job rotation38. employee input is high *--*--*--*--*--*--* lowAPPENDIX 12AN ELABORATION OF QUALITY CIRCLES AND KAIZEN PROCESSES525526As part of the Quality Circle process, data is summarized anddisplayed using the \"seven tools\" for statistical analysis (i.e.cause and effect diagrams, histograms, checksheets, paretodiagrams, scatter charts, graphs, and control charts). Using theseven tools, data on a problem is presented and analyzed beforedetermining goals for corrective action. An overview of the QCprocess appears in Figure 4. The relationship between QC activityand Kaizen suggestions appears in Figure 5.As identified in the Triad \"Quality Circle Training Manual\"some of the goals of Quality Circles are to:• respect the individuality of each member of a circle andto create a setting in which work is meaningful• activate the unlimited potential of employees• reduce defects, inefficiencies, and enhance work quality• inspire more effective teamwork and job involvementThe QC groups at Triad typically have 12 to 15 members who areled by a Circle leader. Meetings are supposed to be scheduled atregular periods in which problems in the work area are to beconsidered. These meetings are to be held during paid work hours.QC members are encouraged to recommend viable problem solutions tomanagement. Project areas which may be explored include quality,productivity, safety, cost reduction, improvement of work methodsand work area cleanliness. Triad QCs are not authorized to addressissues such as company policy, wages, benefits, grievance orpersonal matters. Members of a QC collectively identify a themefor their projects using brainstorming techniques. The themeshould fit with the section, department and plant-wide qualitythemes. Once a QC group theme is identified by associates, it isgiven approval by the group leader, the branch manager, and thesection manager.The QC Branch Manager explains that participation in the QC isnot mandatory, but it is strongly encouraged. In the summer of1991, there were a total of 159 QC groups operating at Triad. Morethan one QC group may operate in certain work areas, but there areother areas of the plant which apparently do not have any QCactivity. All associates and group leaders receive training inQuality Circle theory. The QC training and manuals used at Triadwere created specifically for the company by the Branch Manager forQuality Circles. There is a 15 hour basic training program whichgives the background to quality circles, how the process operates,and an introduction to the seven statistical tools which are usedto represent data related to a problem under investigation. Moreadvanced statistical training is available at an associate'srequest. In addition, there is a three hour QC overview providedfor branch managers.Twice per year in June and December, QC competitions are heldduring which QC groups can present their projects. Projects are527judged by managers based on a group's ability to effectively usethe QC process and to implement an effective problem solution.Successful competitors advance to the plant-wide competition heldin July during which Triad executives, including the companypresident, spend a full day judging the Quality Circles. The QCjudged most successful receives the Triad President's Award and isdesignated to present their project in the Japan Motors CorporateQuality Circle competition held in Japan. One QC group leadermentions that although some of the groups like the element offormal competition, others do not.FIGURE 4QUALITY CIRCLES - THE PROCESS52812) Develop and ImplementCorrective Actions 13 Checking/Braking ►^14) StandardizationA.4-•48) Examine Causes andRelationships4 9) Collect Data 1410) Analyze Data ^11) Identify Root Cause(s) 4) Grasp Current Statusof ProblemA•a529Quality Circles - The Process1) Identify Participants142) Select Circle Leaderand Recorder3) Problem Identificationand SelectionPLAN3) Evaluate Results/Progress416) Prepare PresentationDOCHECKACTIONFIGURE 5QUALITY CIRCLE ACTIVITY VS. KAIZEN SUGGESTION530Though some ideas are available,there Is no clear cut solution.An investigation must be doneto identify the root cause(s).Does not attempt to \"Justify'a groups solution or 'Wish List\"Re •uires Invest' • ationRequires use of OC Techniquese • Limes Analysis 14^Requires use of QC TechniquesRoot Cause(s) Identified I4Corrective Action(s) Developedand ImplementedQuality Circle Activity vs. KAIZEN SuggestionThe result of the process may Include:Written KAIZEN proposalSOP Additions/RevisionsEngineering ChangesWorkstation RevisionsBecause these actions are improvementsto the workplace, they can beconsidered KAIZENs.A Solution IA clear cut solution is evident.Implementation benefits are obviousImplementation of this solutionwill result in immediateimprovement.Management may request additionalinformation to explain why this isimportant or why it will makethe improvements listed.APPENDIX 13A SUMMARY OF THE COMMUNICATION MECHANISMS WHICH OPERATE IN EACH JV532MAYO FOREST PRODUCTSfact sheetsbulletin boardscompany newsletterhandbookmeetings:daily productiondaily maintenancedept. managers (weekly)superintendent (weekly)crew (weekly)safetyQIT, CITOPTIMAmemosbulletin boardsclosed circuit T.V.voice mailnewslettermeetings: plantsfocus groupsdaily productionpre-shift (weekly)qualityQIT, CAT, CITmanagement/R&D533meetings: headquartersexecutives (weekly)senior managers (monthly)communicationKoffee KlatchesOCG MICROELECTRONICSbulletin boardssuggestion boxmemostask teamsQuality lunchesresearch reportsmeetingshandbooknewsletterinternational teleconferencesworld-wide meetingsTRIADwhite boardsnewsletterbulletin boardsQuality Circle Newsclosed circuit T.V.meetings:informal (Japanese)QC/Kaizenproductionsupervisory (daily)departmental"@en ; edm:hasType "Thesis/Dissertation"@en ; vivo:dateIssued "1993-05"@en ; edm:isShownAt "10.14288/1.0076823"@en ; dcterms:language "eng"@en ; ns0:degreeDiscipline "Interdisciplinary Studies"@en ; edm:provider "Vancouver : University of British Columbia Library"@en ; dcterms:publisher "University of British Columbia"@en ; dcterms:rights "For non-commercial purposes only, such as research, private study and education. Additional conditions apply, see Terms of Use https://open.library.ubc.ca/terms_of_use."@en ; ns0:scholarLevel "Graduate"@en ; dcterms:title "International joint ventures: the strategic human resource management dimension"@en ; dcterms:type "Text"@en ; ns0:identifierURI "http://hdl.handle.net/2429/1989"@en .