Cultural differences in managing performance
Performance Management in any organization at any given point of time is work in progress and a process of continuous improvement. With globalization taking its leaps and bounds, a key challenge that HR has in this context is “how to manage a performance process for a wide variety of culturally diverse audience divided by time zones and geographies and varying values and ethos”. Some of the key cultural factors that can come into play while approaching performance can be summarized as follows:
Achievement orientation: Achievement vs. Ascription can be a very big factor determining performance standards and what one strives for in different cultures. Countries like China, Russia, Indonesia and some parts of and Europe is still anchored by values pertaining to Ascription, which is more based on background - family you belong, University you went to and organization you first worked for etc. These factors determine how performance is viewed and measured. For example there is definitely aspects of Halo effect and preferential treatment for those who come from those preferred backgrounds when it comes to evaluating performance. In countries like US and most parts of Europe are more driven by achievement orientation when it comes to performance and the process is more inclined towards formal goal setting, reviews and year end assessment process and there is acceptance and embracing of that. Countries like India, Singapore, Hong Kong and parts of South East Asia are going through transitions from an “ascription” to a more “achievement” oriented culture as a result of the work place getting more westernized due to the opening of the economies in these countries. Sub cultures within these countries have further differences in terms of how they transition between ascription and achievement and vice-versa.
Time Orientation: In countries like US, Israel, Germany and Switzerland where they are driven by individuals with Monochronic preference to time orientation, they clearly demark work time and leisure time. For them work and work related performance is typically a 9-to-5 job or something equivalent. Whereas in countries like Latin America, the Middle East, and Africa, which is driven by polychronic individuals, there is a distinct overlap between work and pleasure and they ideally look at time and work related achievements more holistically. From a performance evaluation perspective they would like to be credited for the time they spent with a client building relationship over dinner or drinks.
Communication: Indirect or informal communication to get jobs done is heavily prevalent in a high context culture wherein performance feedback and evaluation is more considered to be coffee time informal conversations rather than a structured documented approach. Typically, these would be in countries like Japan, Korea, China, and many of the Latin American countries. Formal communication and outlining of goals, expectations and feedback in clear black and white format either verbally or in a written format is a typical aspect of performance culture in low context cultures. Examples of countries that would prefer this communication style include the United States and most European countries.
Individualism versus Collectivism: This cultural dimension is all about how people view performance from a individual vs. group perspective. It is very difficult to have an individual driven performance system where group work, kinship ties and collectivism is the most predominant anchorage of relationship and approach to tasks and work schedules. Most Asian, African and South American societies are typical examples of collective culture where the use of “I” or “my achievements” can be a cultural challenge. This mostly results in individuals focusing more on group work when they are actually evaluated for individual work by a typical American Company that has its operations in these countries. This is because most established Performance Management Systems is geared towards individual processes.
In individualistic societies, individuals are usually assessed on their specific individual goals, and how they achieve them. Individuals are hired and promoted based on individual performance and they typically compete with themselves and their peer groups for performance, compensation and other rewards. Examples of these would be US and North and Western Europe.
So, given these different aspects of cultural differences determining the values of individuals and how they look at performance and achievement, the challenge for HR is to ensure that there is a clear demarcation between systems that tries to drive the process uniformly across the geographies. The process is differentiated as per the needs of the local culture and personal values. A typical example as to how system and practice or process can complement each other would be as follows: In a collective culture, the individual sets goals as per the system that is driven individually accompanied by a process that actually goes over group performances and nails down the scores or the ratings to the individual level. Typically, the system here is centralized, but the process can be localized to complement and sometimes supplement the gaps of the system.
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