The Affect of National Culture on Human Resources Essay

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In today’s business environment, the complexity of international business has increased and international competition has been highlighted as an essential element for multinational firms (MNCs). Thus, in order to gain competitive advantage, various resources are utilized, such as financial capital, technology location or human resource (HR). Moreover, HR could be seemed as one of the most important resource which has also become a focus of attention of senior managers in MNCs. As suggested by MacMillan(1984), MNCs can gain competitive advantage through use of HR practice, such as training, compensation, socialization, selection, performance appraisal and career development, as long as other firms are unable to duplicate their
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Based on Hofstede’s (1993) definition of national culture, it is stated that national culture is the software of the mind, and it is deeply embedded in everyday life and fairly resistant to change. Moreover, it is confirmed that national culture has a significant relationship with HR policies and practice (Hofstede, 1993). Also, Earley (1994) demonstrated that national cultural values that reinforce HR are more likely to yield predictable behaviour and better performances. This is because a national culture is usually characterized by the values of the people who belong to that culture, so well HR practices are consistent with existing behaviour expectations and routines that transcend the workplace. Employees are not distracted from work if HR practices are consistent with national cultural value. The various values had been grouped, by Schuler and Jackson (1994), into four categories, work goal importance, need deficiency, fulfillment, and job satisfaction, managerial and organizational variables, and work role and interpersonal orientation. Furthermore, Hofstede (1993) has presented four largely independent dimensions of differences among national values systems, which were labeled "Power Distance", "Uncertainty Avoidance," "Individualism vs. Collectivism," and "Masculinity vs. Femininity."
1. Power Distance, indicates the extent to which the fact that power is distributed unequally is accepted in the society by those who do and do not possess power.
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