The most interesting topic of all time in business is…? Employment relations. Yeah, exactly. Clearly it’s your favorite topic. Right. I know that you are very interested in this. You do research on this: on labor relations, empowerment, and HR policies. Given that you have a lot of insights there, Given that you have a lot of insights there, I'd like to see whether we can apply some of that to a case, to a critical incident in a way. Clearly I want us to focus on the international, intercultural aspects of it as we talk about it. Mm-hm. You're hired as an organizational development consultant (OD). Congrats. Thank you. It’s a high-paying job. You hired by DHL: a worldwide German logistics provider; and they have a hub in South Africa that they're currently heavily investing in. Their not happy with the performance so they want you to look into it. They gave you short info on- Alright. -what they're doing there. Take a moment to look through it. Alright. What you see is that they have high hopes for the facility? Mm-hm. They really have ambitious growth plans for the region; and hampering that growth is essentially that the facility's underperforming compared to international standards. They have more than high hopes; They have 30%, growth revenues placed there. Yeah. Are they underperforming because of the place where they are, I guess South Africa has poor infrastructure and it's a difficult place to make business. Blame it on their environment. Right. That could be part of it. The fact that the preliminary analysis that they have done suggests, that it's also an issue of labor productivity. It's not just on infrastructure or the non-reliability of partners or whatever. Part of the problem is internal, and they're guessing that motivation might be part of the part of the problem. That's why they bring you in. I see. Who is managing these people? Who hired me, an Afrikaner? Is it a DHL headquarters person in Germany? Yes, it's an ex-headquarters guy. A German, 25 years with the company, a lot of experience in Germany and in Austria, but only two years in South Africa. He's heading this. We could say a moderate knowledge of the local environment- Mm-hm. -local culture? Exactly. A reputedly good knowledge and high experience in process efficiency. Yes. And DHL best practices, in terms of technical solutions. We have a more volitional motivational problem here, and an international culture problem here. Maybe, maybe those are the areas that he's not as strong in. That's why he's hiring you. I see. Okay. Alright, in the course so far we've talked about a number of motivation theories: Content theories by Maslow, McGregor, and Herzberg. We've talked about process theories: the Learn Needs by McClelland and the expectancy theory from Victor Vroom. Let's see whether we can apply those and make good use of them to see whether they can be helpful in this particular case. If you went to the company and arrived there, what would you do? How would you start? I’d probably analyze the status quo. I will basically review their policies to check if all hygiene motivational factors are actually in place. Meaning that do they adequately pay these people? Mm-hm. Are these people working in a safe and clean environment? Exactly. Relative to competition, right? You could benefit from that against other-. Exactly, that's right, relative to competition in the industry or at the country level. Yeah, uh-huh. If these things are in place, then the problem becomes even more complicated because we need to analyze which motivators because we need to analyze which motivators are in place and are not working. Basically, benefits, Mm-hm. opportunities for development and growth with a new organization, and training opportunities. Probably if these things are also in place a second round of analysis might be necessary. Okay, so those issues like safety, pay, opportunities for development are fairly universal. They're not culturally specific. What would the second round of analysis be then? It could be the analyze the managerial side of the story. What do the managers do? What managers do and what managers think about these motivational theories. Mm-hm. The best way to gain insight into this is probably interviewing the key managers involved in the operations, and just to really understand what I think is the right way to motivate people yeah What they idiosyncratically have in their heads as theories of motivation. Exactly. Maybe we can map that on Theory X, Theory Y beliefs. Are the people inherently lazy and do they have to be whipped into shape or are they inherently motivated? What would knowing that that buy you: Knowing the theories in use that people manage to have in their head? We could either act on the level of the employees' perceptions, of their theories if those theories are not wrong- Yeah. -or we could act on the managers’ conception of their leadership styles. Okay. It truly depends on what comes out from these interviews. Okay, so later on you, you have an idea of where you would start from- Right. -and what the resistance might be ultimately? Which leverages should be touched in this context. Which leverages should be touched in this context. Great. Alright, we reviewed the HR policies, we interviewed the managers. What's next? I guess we missed the workers here. Oh, that just… That's all… That's just a big thing. Probably the best way to gain insight into the work area is a survey,- Uh-huh. -individual level data. Data survey. We could survey them about their work experience, their relationship to DHL and especially, about their level of motivation and attachment and what is actually working for them and what is not. This could be a good way to get fine-grade understanding of the matching between those hygiene factors that we saw in the policies and the actual employees’ experience. Their perspective of it. Right. Individuals of the data, that also helps us to deal with stereotypes to some degree. Right. I would say this is particularly useful since our manager is a German guy. I would say this is particularly useful since our manager is a German guy. Well because he's a foreigner not because he's a German. Well because he's a foreigner not because he's a German. Right. That's true, that's true. That was-. Fact taken. I guess he, like me or you would have a very simplified way of aggregating all these Afrikaner workers as a big bundle of initial type. Yeah. I believe that getting this individual data could help him to actually see who these people are beyond the stereotypes. It may be that this is also useful in terms of understanding what incentivizes people. Mm-hm. We talked about power distance in South Africa before. Probably, another issue there is individualism. Mm-hm. As we said the infrastructure-. Yeah. Since they're high in individualism they're probably incentivized at an individual level, rather than a team level. So you need individual level data to understand the labor dynamics. That's right, okay. So ultimately when you have that individualist orientation or at least and indication that they might be an individualist orientation. Then you also want to give individual feedback not just individual incentives. Your survey would actually be a great starting point for that. You get the individual, data. Then you can start providing feedback based on that as well. South Africa is a very diverse country. Yep, very diverse. A lot of groups are there coexisting Black natives. Now they are coexisting as black natives. Yep. European roots Afrikaners. That's right, yep. Immigrants, right? British immigrants, Asian immigrants, I guess, Indians mainly. Yeah Right. How does that impact things? Why would you worry about that? These people are likely to have different education levels different literacy rates. It could be. This is a very interesting factor. Although not really covered by traditional motivation theories, right? The diversity issues are not really in what we covered. But to some degree you could say that McClelland’s needs the motivation that you have. The motives that you develop are or the needs that you develop are based on your ethnic background That's true. Different ethic groups may have different levels of achievement motivation at least would be his argument. Well surely the differences in this particular context are going to be huge. But it's something to think about. And you could connect it actually also to this, idea of how do you, calculate expectancy because that also links to your self Right. Right. And to your background. It’s the way you perceive your ability to perform a job. Exactly. The way you perceive your self efficacy are likely conditioned by your ethnic group, your level of education. And even if we have the same level of education, our ethnic group could influence our different perception of out results. That's right. Objectively same levels of education or literacy might have very different self-perceptions still. Okay. Which would mean setting a particular goal for someone for two people of different ethnic backgrounds. Might have very different motivational consequences. Depending on whether they self perceive themselves as being able or not being able to do it. You’re right, it makes things more complicated, You’re right, it makes things more complicated, complex for the managers in a way. It's not just an individual level story, it's also a group level story. Yes, that's where diversity usually the challenge the group level. A lot of dynamics might be in place, especially in a country with South Africa's history of segregation. of segregation. We can say that these different groups might have problems in trusting each other. Developing and sharing knowledge. Maybe, maybe. Shared language to understand each other. People will be more motivated at the individual level than at the very collective level. As they don't want to help each other or they're not motivated to help each other, to share knowledge. It's possible That's an option. It’s something to look into. The ethnic group tensions could cause problems with groups working together Which in logistics, is kind of-. Well, it's kind of a problem as people need to work together. Well, it's kind of a problem as people need to work together. We need to a smooth collaboration and coordination. That could be an issue. That could be an issue. What would you recommend then to your client? I guess a sensible way to go would be diversity and inclusiveness policies. Mm-hm. I'm thinking of sensitivity campaigns through training. Yeah. Reestablishing the group leadership in a way to have dual leadership so as to invoke members from different groups, or promotions is a classic way to go. Like, promoting members from these, traditionally discriminated groups, should help these groups to climb up the ladder. Although, some evidence, especially about gender. That would tell us a different story. Like, sometimes these members, who are promoted, tend to paradoxically discriminate against other members These things might backfire somehow. There are a lot of good books that provide interesting guidelines about it. Sure, sure. One I like is, Michele Barbaric's book, Managing Diversity. And it's a good perspective and there are a lot of good ones out there. This is what it gives to you, is what you give to your time. Okay That's what we are suggesting. That's what we are suggesting. A lot of these practices that you mention, so the training. Mm-hm. Dual leadership, promotions. In my ears that sounds a little bit like you're empowering the traditionally disenfranchised, disenpowered groups. This is about you're empowering people right? Well it is but meaning that in high power distant contests empowerment could also be problematic to people. People might feel very stressed out by the responsibilities on their shoulders. By this need to make decisions. And so it's not always a good thing. That’s one thing that’s very important in international contexts. Don’t always assume that, because empowerment is great in your own culture everybody's going to embrace it. everybody's going to embrace it. Maybe there need to be steps towards that route. It might be a big shock as you say It might be a big shock as you say creating tension stress. But an interesting solution, in an international environment, is this idea of associating the empowering policies to a cultural role model. I’m within or outside of the organization? A political leader, a very successful businessman Or any other role that in that society at the local level. successfully implemented some empowering techniques or behavior. Yeah, I can offer power. Indeed. It makes it relatable, it makes it culturally relevant to pursue that path. Yeah. Well one last thing we can look at are the types of contracts that our client is using. Okay, so the contracts. Yes. Why the contracts? Well, because of the industry we're working in. Logistics is an industry which, typically, a lot of, differentiated contracts are used to guarantee flexibility and cost efficiency. I mean, by differentiated contracts, I mean temporary workers, permanent workers, agency workers, contractors. And the interesting thing here, is that they are likely to work on very interdependent things and their interdependent activities. Mm-hm. So why does that create problems? Well it does have, it MIGHT have negative impacts in terms of group dynamics. People might perceive each other as threats just based on their different employment status. What I mean by threat is that temporary workers might perceive permanent workers as an obstacle-. Mm-hm. -for their shift to a superior status and to more job security; while permanent workers might perceive the temporary workers as less capable, less experienced and so they might perceive them as an obstacle to their daily activities. As they need some training, some support and this is perceived as a loss of time, basically. So, they're slowing everybody else down. Exactly, exactly. Okay. Yeah. So, these are the kind of threats I'm talking about. And if you think about it somehow. This decreases your satisfaction as a worker, increases your stress and your fear of losing your job. This also decreases the quality of your relationship and attachment to your direct supervisor, to the organization as a whole. And you might likely want to leave at some point. Okay. So proven that, how do they manage the tensions? Well, the tension could be managed in a number of ways. The one that comes to my mind is an incentive system, like better balancing middle level incentives versus collective level incentives. Although we are an individualistic culture, collectives might be a good way to go. So a better balance there? Better balance over there. He also mentions career paths and job security, so you could have more explicit policies that guarantee or make very explicit that there is an opportunity there for that as well. Exactly. Basically OHRs policies and systems should be consistent with the level of fragmentation of your contracts portfolio. Okay. You pointed out a number of areas that DHL should look into; points they should reconsider given their diversity of workforce, diversity of their contract portfolio. If you had to give them a recommendation for the future on how to better deal with those complexities, what would it be? Well, hire me. I'm a great consultant. *Laughs* What could they do themselves? If you're not available, if you're on some other consulting job. Well, they would probably need to understand individual needs, individual motivating factors, individual concerns. And this is important, since they have a very diverse workforce in terms of races and ethnic groups. They need to do this to avoid generalization and stereotyping. And on the top of this they also need, probably, to have a good understanding of group dynamics. Since the business requires a lot of task interdependency. You probably want to understand how people work together. Given these deep ethnic diversities and this deep contract diversity that are present in this organization.
