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Workforce Management -- Worlds of Difference

Nov. 15, 2007
Language isn't the only communication barrier when establishing foreign operations. Every culture has its own workplace customs and expectations, and savvy managers are knowledgeable about all of them.

Eraser Man seemed like a harmless gimmick to promote lean manufacturing throughout the global operations of Columbia, Md.-based W.R. Grace & Co. The pink eraser mascot was supposed to convey a simple message: eradicate or "erase" waste. But when the $2.8 billion specialty chemicals manufacturer introduced Eraser Man during a focus-group session in China, the company's Asian staff was perplexed and perhaps a little miffed. That's because in China, erase actually means invisible.

"They said, 'Do you really want this program to be invisible?'" recalls Michael Piergrossi, W.R. Grace's vice president of human resources. "Of course, the answer is, 'no.'"

Also at issue was the color pink. "Pink is just not an acceptable color in China; it's feminine. No self-respecting man would want to be associated with a program that's marked by the color pink," Piergrossi explains.

Grace's cultural gaffe wasn't unique. In fact, it's becoming all too common for manufacturers as they go global. Fortunately for Grace, the mistake was easily corrected (Eraser Man is now tan instead of pink and employees in China are asked to "simplify" or "reduce" rather than erase). But other manufacturers worldwide can face much more serious consequences when they don't prepare for the varying customs and workplace practices of their foreign operations. The potential fallout includes trust issues between employees at home and abroad, along with safety and quality standards that don't quite match up with those within domestic operations.

Pink Eraser Man (top), tan (below).
Multinational companies also encounter workforces that place different values on workplace benefits. For instance, in parts of Asia employers face increasing demands from workers that can make attracting and retaining talent a challenge, according to an IBM report released in October. According to Big Blue's Global Human Capital Study 2008, 46% of human resource executives surveyed in the Asia Pacific region (excluding Japan) say compensation is a key driver for attracting candidates, compared with 33% worldwide. At the same time, existing employees in this region expect more career opportunities than in other parts of the world, with 53% of respondents listing upward mobility as critical for retention versus 43% globally.

'Embarrass the Leader'

The good news for manufacturers is this desire to learn represents eager, hard-working employees who give multinationals a chance to nurture homegrown talent in those countries. The challenge is identifying those workers, since local mores often hinder open communication. Guardian Industries Corp., an Auburn Hills, Mich.-based glass products manufacturer with more than 19,000 employees in 21 countries, found this out when it first entered Luxembourg, says Russell Ebeid, president of the Guardian Glass group. "People were not used to singular responsibility," he says. "They had always been told what to do."

Getting employees to accept leadership roles required a little coaxing and encouragement, Ebeid says. They also needed reassurance that mistakes were part of the learning process. "Once they found out that they could try things and not get hit over the head, then they started feeling more comfortable, and slowly they began to feel like it was their operation and not part of a big multinational company," Ebeid relates.

He also says some cultures are more comfortable solving problems on their own instead of contacting someone from a different country for help. For W.R. Grace, such stubbornness can be downright dangerous. The company stresses to employees that a safe working environment is dependent upon them reporting incidents. But that's easier said than done in some regions, according to Piergrossi. "In a lot of Asian cultures it's very hard for an employee to do something that could in one way embarrass the leader, and we needed to train our leaders to encourage this form of reporting -- [that] it wasn't something personal; it was something we needed to do to make the place better."

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When Virtual Worlds Collide
Safety also is a major concern for $11 billion paints and sealants manufacturer PPG Industries Inc. Like W.R. Grace, PPG employees handle chemicals that require special care. That means in developing countries where safety standards may be lacking, PPG must provide extra training (approximately 20% more in Asia Pacific) and be more vigilant, says Viktor Sekmakas, PPG's vice president of coatings and managing director for Asia Pacific.

Onsite contractors require the most attention, according to Sekmakas. "That's where you really have to be careful because their standards aren't quite the same as ours, so we have people watching them all the time to make sure they operate in a safe way," he says.

The same holds true for product safety. The spate of recalled Chinese-made products over the past summer has resulted in heightened public scrutiny over foreign workplace practices. In China, PPG tests materials coming in from lesser-known suppliers and conducts audits several times each year of all its vendors to ensure they're following quality procedures, Sekmakas says.

Localize, Localize, Localize

While PPG provides direction for their foreign workforces, each regional operation has some autonomy in their decision-making processes. Similarly, Guardian strives to "nationalize" each foreign plant as quickly as possible, says Chuck Croskey, Guardian group vice president and managing director for Asia-Pacific and Mideast-Asia. In other words, the company trains the local workforce to run each facility within three years of startup. Otherwise, communication disconnects can make relaying critical information challenging. "Language barriers, voice inflections and hand gestures all have certain meanings that are very important," Croskey observes.

W.R. Grace employee Steven Zhang tests chloride content in cement additives at the company's Beijing R&D lab.But here's the rub: Low-skilled workforces require intense training. Guardian has addressed the skilled-worker shortage in certain foreign markets by establishing a school along with a housing colony to develop local talent. Students pay tuition to attend the school, but a company employee who has been employed for a year can receive a full year of paid tuition rather than a cash bonus. The employee is allowed to pass that tuition on to any family member or friend. The Indian culture places a high value on their children's future, so such generosity often earns employees a great deal of respect within their community, Croskey says.

PPG's learning environment consists of onsite and online training courses. The virtual academy helps the company transfer knowledge from its mature regions to developing countries, says Debra Simeone, manager of blended learning for corporate human resources at PPG. The online learning center offers courses ranging from product training to leadership and ethics. It also features bulletin boards, message boards and chat rooms where employees can communicate with each other -- all functions that help PPG's offshore workforces understand the company's strategy, standards and protocols for each respective region.

A 'United Nations Approach'

A knowledgeable, local workforce helps foreign workforces operate more smoothly at home, but what happens when they need to collaborate with employees outside their regions? Guardian has created a companywide "United Nations" of sorts that includes approximately 100 company representatives from each of its regions who meet twice a year. The meetings give employees an opportunity to discuss trends, new ideas and what's happening in their markets.

W.R. Grace has a similar program in place consisting of 25 people from each of its worldwide operations who serve as an advisory board to the CEO and his executive team. The council, which is relatively new, has one meeting under its belt and has already recommended that the executive team participate in a leadership training program that focuses on how body language and other behaviors impact employee perceptions, according to Piergrossi.

These global get-togethers can boost morale and reduce the likelihood of conflicts or tension between employees from different cultures, which was an issue at the Newnan, Ga., operations of German-based Grenzebach. The maker of production equipment for the glass and construction materials industry faced a contentious situation when a German worker visited the plant to provide assistance.

Germans tend to be direct in their communications and can appear to be brusque or even rude to Americans, explains Manuela Franke, Grenzebach's human resources manager. So when the expatriate barked instructions to the U.S. workers, the employees didn't feel respected. The miscommunication resulted in divisions between U.S. and German employees, says Daniel Highway, the Newnan operations manager. "In the translation the statements or the sentences come out a lot stronger and instead of building as a team, then you start building up walls," he notes, "but we've been really successful at breaking those down."

The company is helping to break down those walls through an exchange program in which workers from Germany spend time in the United States and vice versa. The program is designed to build camaraderie by incorporating offsite activities for the out-of-town guests. For instance, when U.S. employees visited Germany this past summer the host employees gave their foreign co-workers a tour of the area. "They showed them around in Germany so they could understand the culture a little bit more and get a feeling for how Germans live," Franke says.

Maybe the real U.N. should be taking notes.

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