Can HR Organizations Used in the West be Used in High Tech Organizations in India?

Introduction

Personnel management, also known as Human Resource Management, is an essential management concept in the modern world. The practice and approaches of HR management have been one of the key factors of the global industrial scenario for a long time and the concept came up in India after the 2nd world war. There are 5 essential M’s that make up industrial organizations and establishments and they are Material, Money, Man, Machinery, and Method. Whereas the management of other M’s requires less effort, the management of ‘Man’ requires special skills as this factor is scarce and enjoys rationality. Thus, motivation and management of human resource is very crucial and there is a specific department for this activity in every organization known as personnel department.

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The various HR approaches to performance as well as organisations appraisal and their effectiveness are often topic for serious discussions. Correspondingly, a discussion on the prospect of HR organizations and approaches to Performance Appraisal successfully practiced in the West in their effective implementation in the high tech organizations of India is very relevant. We can identify various perspectives to the topic. Some of them agree with the possibility of it whereas some others do not. “There is some empirical evidence which supports the assumption of differences in cross cultural transferability of HRM practices.” (Warner & Joynt 2002, p 19).

In one of the researches that the book refers to concludes that “recruitment and training did indeed appear to be less culture-bound than promotion, performance appraisal and financial compensation.” (Warner & Joynt 2002, p 19). Likewise, the research by Child, as the book suggests, “showed that the introduction of foreign approaches in appraising, promotion and career development were not very successful, whereas new approaches in payment and staffing showed a somewhat higher success rate.” (Warner & Joynt 2002, p 19).

Now, the most significant question that arises in this context is regarding the scope of the western HR approaches in the new and fast developing industrial powers of the world. In this discussion we focus on the question whether HR organizations and approaches to Performance Appraisal that are extensively practiced in the West can be used in high tech organizations in India.

With this endeavour we attempt to deal with, in various sections, HR approaches (organizations and performance appraisal) in the West, India and India high tech, strengths and weaknesses of approaches in West for Indian culture and for the Indian high tech, and How HR approaches (organizations and performance appraisals) can improve in Indian high tech. Thus, in dealing with various aspects of the pertaining question about the scope of western HR approaches in India, the discussion brings about the ultimate conclusion that the future of these approaches in India is secure given the Indian high tech and the West learn from each other certain lessons about HR approaches.

HR approaches (organizations and performance appraisal) in the West, India and India high tech

First of all, it is important that we comprehend the HR approaches as practiced in India, its high tech enterprises, and the West. There are various factors that helped to evolve personnel management in India. The main factor is the need to safeguard the interests of the people working in an organization. Earlier, in the scientific management era, the human resource in an organization was treated as machine. They had to work almost 18 hours a day. The employees in an organization suffered very much mentally as well as physically. The working environment was also not encouraging. There was no human resource department or such provisions to the assistance of the employees.

However, in the modern period the situation is totally changed. Now, every organization in India gives due importance to human resources and its management as they are the most important as well scarce resource in an organization. A specific department called HR department is set up in every organization to control and co-ordinate the activities of human being.

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Performance appraisal as a part of HR approach started in Indian from the time of Second World War. This concept evolved from Taylor’s time and motion studies. Accordingly, if an employee’s performance is found less than the standard, a cut in his pay would follow and on the other hand, if the employee’s performance is better than the expected level, he/she will be pay more. The appraisal results are used to identify the performance of employees.

Generally, there are a number of public companies in India. So, in the public sector the term “performance Appraisal” is meaningless as its employees are paid monthly salary even he/she is an efficient worker or not. The Government organizations in India also follow a specific salary scale and the performance appraisal is not very important there.

“In the early part of the 1900s, Taylor, the father of scientific management came to the conclusion that the Western industries were woefully inefficient because of the absence of any systematic approach to human resource management.” (Brewster et al 2004, p 4).

Almost all organizations in the western countries follow the piece rate system that is they are paying according to their quantum and quality of work. So a close supervision is needed for their work. The organizations in the western culture are hiring the employees for doing a particular work and they are also paying according to their work completion. This will motivate the efficient employees to perform more effectively so ultimately the company can gain more. So we can say that, this is one of the reasons for the success of the companies in the western countries.

Hi tech companies in India are facing competition in this era and they are the driving forces for the economic growth of India. They adopt some techniques from the western organizations especially in the marketing areas. They are in a path of growth mainly because the top level managers are controlling and co-coordinating their subordinates in a better way. Almost all hi tech companies in India are hiring the employees for a piece of work and the employers are paying according to their performance and so in hi tech companies the activity of “performance appraisal” is playing an important role in the Hi tech companies.

Performance appraisal

Performance appraisal is a process of evaluating the work done by an employee in the organization and maintaining the records of their performance. This process is doing either by the personnel department or by their immediate supervisors or the managers in the concerned department. The process “performance appraisal” is conducting by the employer because sometimes the employees cannot achieve the goals or if there is any variation from the standard to the actual performance. The various tools and techniques for performance appraisal are,

  1. Trait rating scales: This is the oldest and most widely used technique. Under this method the employers rate their employees according to the characteristics and they rank their employees as outstanding performers, excellent performers, extra ordinary performers, poor performers etc.Through this technique the employers can assess the attributes such as co- operation, communication ability, technical competency etc of their employees.
  2. Job dimension scales: under this technique a rating scale is fixed for each job. This technique is applied separately for separate job description.
  3. Behaviorally anchored rating scales (BARS): under this technique separate rating scales are used for each job classification. It mainly focuses on how an employee is behaving to his job. It does not consider the characteristics of employees in general in the organization. Numerical scales are used in this technique.
  4. Check lists method: The different types of check lists are simple check lists, weighted scale and forced checklists. In this technique a list of behaviors of behaviors are composed. It includes some words or phrases about the behaviors of employees and rank according to how the employees are behaving to each work.
  5. Self appraisals: under this method the employees themselves are doing the appraisal process. They are themselves producing a written document of accomplishments and productivity in their own work. That is in this method the employees are assessing themselves.
  6. Essays: the name itself it is clear that the employers prepare a descriptive note about the strengths and weaknesses of their employees and what are the areas of their improvement. It gives a detailed description about an employee.
  7. 360o feedback: This is a modern approach. In this method an employee is assed by his employers, his subordinates, the employees in his same designation. In this method an employee is assessed from every dimension. That is, this is a multi source feedback.
  8. Management By Objectives: This is an objective oriented approach. Under this approach the employer gives a specified objective to achieve to every employees and the assessment is done according to the results which is achieved by the employees. This method is applied to assess how the employees attain the goals.

HR organization structure in India

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Down/upsides of approaches in West for Indian culture

Among the various functions of the Human Resource Management of a firm or an organization, one most essential function is that of the performance appraisal of its employees. In this effort there are various systematic, well-recognized, effective, and successful approaches which are mostly developed in the developed economies of the Western countries. These approaches aim, chiefly, at the performance appraisal of the employees. “Performance appraisal may be defined as a structured formal interaction between a subordinate and supervisor, that usually takes the form of a periodic interview (annual or semi-annual), in which the work performance of the subordinate is examined and discussed, with a view to identifying weaknesses and strengths as well as opportunities for improvement and skills development.” (Performance Appraisal. 2006).

As Flippo puts it, “performance appraisal is the systematic, periodic and impartial rating of an employee’s excellence in matters pertaining to his present job and potential for a better job.” (Flippo 1984, p. 225) Or it may be understood as “the systematic evaluation of the individual with regard to his or her performance on the job and his potential for a better job.” (Beach 1975, p. 258) There are many arguments that prove the efficacy of a good approach of the performance approach.

“The performance appraisal, when properly carried out, can help to fine tune and reward the performance of present employees.” (Billikopf 2006). Thus, a proper performance appraisal in the Western as well as Eastern human resource managements provide the best feedback on the performance of the employees, helps in the communication between an employer and employee, outlines a right basis in adopting decisions regarding the employees including salary hikes, job promotions and other management activities, and even works as useful instrument for employee training.

Having seen the significant role of these performance appraisal approaches that are mainly developed in the context of Western developed economies, a crucial question remains: Can these HR approaches to Performance Appraisal as used in the West be used in high tech organizations in India? In finding a right answer to this question it is important to consider the strengths and weaknesses of these approaches as used in the western countries and the peculiar nature of the Indian culture.

There are various approaches to performance appraisal in India that are made use in the industries there. The most important among them are

  1. a casual, unsystematic, and often haphazard appraisal,
  2. a traditional and highly systematic appraisal,
  3. appraisal through mutual gal setting, i.e.

Management by Objectives(MBO). The first approach was the common approach of the past which is no more used “with the need for quantitative and qualitative measurement of output for the rank-and-file personnel.” (Khanka p. 347) The traditional approach “is used to evaluate

  1. employee characteristics,
  2. employee contributions,
  3. both.” (Khanka p. 347)

This approach made it clear that the size of the firm and the extent of formal evaluation of the employees are very much related. The third approach, also called “the behavioral approach” may be regarded as an improvement upon the traditional approach and the manager of the firm is considered as all in all and the evaluation of the employees many often were subjective and biased. As a remedial approach evolved “a new approach giving emphasis on mutual goal setting and appraisal of progress by both the appraiser and the appraisee” and the approach is popularly known as Management by Objectives. (Khanka p. 347).

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As it is clear from the above discussion the most important modern approach of HR approaches used today is the Management by Objectives propounded by Peter F Drucker. It is much greater than a normal method of performance appraisal and is often regarded as a philosophy of managerial practice as it is the practice by which the managers and their subordinates plan, organise, communicate, control, and debate.

Many of the engineering giants of the world now follow this approach of performance appraisal. The chief limitations of the approach, which is not a panacea for all the organisational problems, are “unclear and unmeasurable objectives set for appraisal,” “time consuming,” “tug of war” between the manager and the subordinates, and the “lack of trust” by the management on the employees. (Khanka p.353-356). There are also other effective approaches like the 360-degree feedback which covers the feedback from all the levels of the organization including the subordinates, peers, other managers, and from the employee himself as self-assessment. All these approaches of performance appraisal have various types of strengths as well as limitations.

In understanding the scope for these performance appraisal approaches (mainly developed in the Western industrial background) in the Indian context, we need to consider the peculiar nature of the Indian industry. The industrial tradition of most of the Indian firms is not very encouraging to the significant approaches of performance appraisal and even the other human resource management systems. The working of the firms is controlled by various peculiar situations in India as well as it is greatly influenced by the political and trade union culture. These peculiar characteristics make the development of such approaches very difficult.

The situation of the traditional, domestic firms and enterprises prove the same fact. Even the situation in the so called multi national establishments is not much different. It is the same case with almost all the human resource management activities. This peculiar nature of the firms is common to almost all the Eastern developing industrial economies as compared with the Western industries. “In most internationally operating firms, the human resource management system is still managed as if the companies were exclusively operating on domestic markets. What they need to apply, however, are global concepts of management in general, and HRM in special.” (Pieper 1990, p 5).

Many often the establishments in India fail to notice this international characteristic feature of their working, though the situation is slowly changing with the advent of multi national firms and other companies working an a global base. Yet, the differentiation between an Indian industrial firm and a Western undertaking is very much evident in the first sight.

There are basic characteristics that distinguish the human resource practice and activities in a developed, self determining industrial establishment in the West and those up-springing firms and industrial culture in countries like India. As the crossvergence theorists make clear the countries of the world will influence and support each other economically as well as culturally as a result of the development in the global economy.

However, the cultural and other peculiar characteristic features of each country differ entirely from that of another resulting in the difference in managerial and human resource practices of the industry in each country. Likewise, there are great dissimilarities between the human resource management in the countries of the Western tradition and those of the Eastern tradition including India. The basic factor determining this difference is the human values that exist in the two cultures.

This is clear as we examine the human resource practices followed in these cultures. “Traditionally, Western countries such as the United States have long practiced instrumentalism, which considers human resources mainly as a means to an end, emphasizing individual competence of employees to make the best use of these human resources through a calculative exchange between employers and employees. It focuses on a utilitarian value of people in organization as they are managed as a resource. Just as time needs to be managed in the most efficient manner, people also need to be managed in the same way. In stark contrast, Eastern countries…, traditionally value human being in their own right.” (Vance & Paik, 2006, p. 53)

The human resource approaches in the West, though blindly followed in most of the high tech organisations and the multi national companies in India, face many barriers in the effective implementation in India. The most significant reason for this factor, apart from the limitations of these approaches as such, is the cultural difference and the peculiar economic and social situations that exist in India. For example, the interference of the trade unions and other political organisations in the working of the industry is much higher compared to that of the Western countries and these affect greatly the human resource practices especially the performance appraisal of the employees.

Therefore, the possibility of the effective implementation of these practices is adversely affected by these peculiar situations. Same is the result when the sex discrimination of the females, which is much greater in India compared to the West, affects the implementation of these human resource practices and approaches. Thus, we can accurately conclude that the human resource approaches to performance appraisal in the West have a greater challenge before them in their implementation in India and other such countries.

Down/upsides of approaches in West for Indian high tech

Human Resources approaches that are practiced in West, India and India High tech are different from each other. The human resources approach regarding staff appraisal is focused on in this study. The adoption of western practices will have both positive and negative effects when applied in the India context.

The merits of such adoption can be referred first. The HR practices adopted in one country have a relation to the culture and attitude of persons of that country. “Performance appraisal provides an excellent example of a practice which bears culture’s influence.” (Australian journal of Public administration. 2002).

Therefore, application of western performance appraisal in the Indian high tech helps the Indian high tech environment learn the specialized appraisal techniques of the west. The case of employee insurance can be seen at first. In the western culture the organizations provide insurance coverage to their employees under many plans. But in the Indian high tech this is not practiced in a great extend. So while adopting this strategy the Indian high tech can develop an organizational environment of highly motivated employees. The insurance coverage is satisfying the security need of a person as stated by Abraham Maslow. The appraisal practices in the west are highly specialized.

The western countries have scientifically drawn appraisal techniques employed in the organizations. While these scientifically drawn techniques are employed in the Indian High tech organizations it can develop highly specialized HR approaches within it. The organizations in India can also get rid of the outdated techniques that are used. This will help the organization to develop a team of highly competent employees that will ultimately help the organization to be the leading one in the country. A structured performance appraisal will help the high tech company to frame proper remuneration for the employees on the basis of the results of performance appraisal.

The high tech companies are also more exposed to the adoption of western HR approaches to the performance appraisal. The reason is that many high tech companies in India have foreign and western influence in the form of shareholdings or any other partnership. Another major advantage of the adoption is that the employees in the Indian High Tech has more global outlook than the pure Indian organizations. Some of the Indian high tech companies are those that have a direct or indirect foreign interest in it. So adoption of a common approaches in both the Indian and foreign branches makes the functioning smoother.

The Indian culture has a peculiar influence on the human resources practices. “In cultural terms compared to an English person, an Indian person is more fearful of people in power, obedient to superiors, dependent on others, fatalistic, submissive, undisciplined, friendly, modest, unreserved, collectivist, caste-conscious and clanorientated and law-abiding. On the other hand, compared to English people, he is less self-controlled, tenacious and less willing to take account of other people’s views.” (Budhwar & Debrah 2001, P.80).

The demerits of the adoption of western appraisal methods can be enumerated next. Majority of the persons who are employed in the Indian high tech are Indians. Therefore as mentioned earlier culture has great influence on the HR practices and appraisal techniques. As a result there will be lower acceptability of the approaches among the employees of Indian High tech compared to that of the western. The reason for that is the difference between the cultures of both the region.

The adoption of certain western approaches will not be accepted by the employees and the issue will be raised in the political level through trade unions. This will harm the reputation of the organization and continuous occurrence of such incidents can even result in the foreign company lose interest in it. The western approaches consider human resources just as tool to achieve the objectives of the organization. In contrast the approaches in the eastern countries like India always give a human consideration for the work force. Therefore, the Indian high tech too will reflect the same behaviour whereby certain western appraisal methods will be challenged by the work force.

How HR approaches (organizations and performance appraisals) in Indian high tech can improve

It is seen that the India high tech is much more adaptable to the western approach than the pure Indian organisations. Therefore, the scope for its improvement is also higher. In order to improve the HR approaches of Indian High tech the basic attitude of the employees towards the work should be changed. In order to improve such attitudes the management team must bring into the Indian high tech the motivational techniques of the western countries.

When this external or western performance appraisal is linked to the motivation the technique will have wider acceptability among the employees. In order to improve the Indian high tech, the sector should adopt those positive influences of the western as well as the Indian approaches. The combination should be such that the Indian style is not completely avoided as the culture of the employees is more inclined to the Indian side.

As we have seen in the discussion, there is greater possibility for Indian high tech organisations or the multi national establishments to adopt the HR approaches and practices for the effective functioning of the establishments. The performance appraisal in such firms can be carried out with not greater limitations in the modern context of global market concept. The high tech firms in India function in almost the similar manner as their Western global counterparts do.

In this modern situation, if these favorable conditions are made use in their proper implementation, the HR approaches including the organisations appraisal as well as the performance appraisal, that are mainly developed in the industrialised context of the West, can be improved in India. Let us also not forget the fact that India is one of the fastest growing international economy and developing industrial nation. Here, the favorable conditions that are made possible by the globalisation and other effective policies may be utilised to its maximum in order to improve the scope of HR approaches to performance appraisal and other practices.

The Indian industry, along with other developing economies, has to maintain a more industry-friendly outlook. If these countries understand the scope for improvement in growing with the international industry, the chances of HR approaches and practices to function more effectively in these countries. “What they need to apply, however, are global concepts of management in general, and HRM in special.” (Pieper 1990, p 5). Thus, the global concepts of HR practices implemented mainly by the Western countries need to be strengthened in countries like India for their industrial development and global survival of their industrial establishments along with the other international competitors, especially their Western counterparts.

The economic situation in India is very much corresponding to this requirement for improvement. What is more significant is the right understanding of the cultural, political, social, and economic peculiarities of this country that stand in the way of the improvement in the HR approaches and practices of organisations and performance appraisal. Thus, we may conclude that if the Western approaches understand the peculiar cultural and other situations in India, as well as the Indian high tech industrial establishments and organisations identify the need for improvement in their HR approaches along the lines of the global, especially the Western HR management, there is a room for improvement of these HR approaches in India.

Conclusion: Lessons about HR approaches (organization and performance appraisals) Indian high tech and West can learn from each other

In the ultimate conclusion to the question as to whether HR organizations and approaches to Performance Appraisal that are practiced in the West can be used in high tech organizations in India, we may safely respond that the answer is of a relative nature. There are various lessons about HR approaches that are learned mutually by the Indian high tech and the West. First of all, let it be clear that there is a greater possibility that the Indian high tech industrial establishments adopt the HR approaches and practices to organizations as well as performance appraisal that are developed primarily in the western industrial context.

This is mainly because the survival of any economy or industrial establishments ignoring the competition raised by the global market, specifically comprising of the western multi national establishments, is difficult. India is a fast developing industrial power and for the faster growth of its establishments the country need to open its doors to such successful approaches and practices of HR management so that it reflects in the development result of the Indian industry. The most significant aspect is that the Indian industrial establishments understand the inevitability of such internationally recognised approaches and prepare themselves for the necessary changes in their HR management strategies. Hence, the HR approaches of the West provide valuable lessons for the Indian high tech firms.

Similarly, there are certain crucial messages that the Western approaches and other HR practices need to assimilate from the Indian cultural context of industry and business. There have been various research findings and studies that point to the cultural, social and other such differences that underline the industrial framework of different countries. “There is some empirical evidence which supports the assumption of differences in cross cultural transferability of HRM practices.” (Warner et al. 2002. p 19).

Thus, it is important that the West comprehends the relevance of this cultural difference in the effort to find its HR approaches established in countries like India. The cultural environment of Indian establishments in their political intervention, trade unionism, sexual discrimination, employee background and performance and many such aspects differ tremendously from that of the Western context. It is this realisation of the reality that is required from the part of the West.

To conclude this discussion on the prospect of HR organizations and approaches to Performance Appraisal successfully practiced in the West in their effective implementation in the high tech organizations of India, it is evident that there is a greater possibility for the same compared to the pure Indian organisations. Also, we can very well comprehend that the HR approaches and practices put forward lessons of great significance to both the Indian high tech companies as well as the western outlook and approach of the same. The value of performance as well as organisations appraisal and the HR approaches to them is unquestionable.

Bibliography

Australian journal of Public administration. (1999). Research and evaluation, abstract. [online]. Blackwell synergy. Web.

Brewster, Chris., & Mayrhofer, Wolfgang., & Morley, Michael (2004). Human Resource Management in Europe: Evidence. Elsevier. p. 4.

Budhwar, Pawan S., & Debrah, Yaw A., 2001. Influence of national culture on Indian HRM Human resources management in developing countries. Routledge. P. 80.

Beach, Dale S., 1975. Personnel – The Management of People at work. Macmillan Publishing Company, New York. P. 258.

Billikopf, Gregorio(2006). Performance appraisal. [online]. Web.

Flippo, Edwin B., 1984. Personnel Management. MacGraw-Hill Book Company. New York. P. 225.

Khanka S.S., Human Resource Management (text and cases). S Chand Company. New Delhi. P. 347.

Khanka S.S., Human Resource Management (text and cases). S Chand Company. New Delhi. p 353-356.

Performance Appraisal. (2006). Modern Appraisal. [online]. Web.

Pieper, Rüdiger., 1990. Human Resource Management: An International Comparison. Walter de Gruyter. p. 5.

Vance, Charles. & Paik, Yongsun., 2006. Managing a Global Workforce: Challenges and Opportunities in International Human Resource Management. M.E. Sharpe. p. 53.

Warner, Malcolm., & Joynt, Pat (2002). Managing Across Cultures: Issues and Perspectives. Thomson Learning EMEA. P. 19.

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