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Trade Union and International Labor Relations “Do It the Wal-Mart Way”. Presented by group 5 : Shady Ismail Michael Shumyater Michelle Robertson Ann-Kristin Hocke Fanny Voluer. Agenda. US Country Profile Germany Country Analysis Social Political Cultural

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Trade union and international labor relations do it the wal mart way

Trade Union and International Labor Relations “Do It the Wal-Mart Way”

Presented by group 5:

Shady Ismail

Michael Shumyater

Michelle Robertson

Ann-Kristin Hocke

Fanny Voluer


Agenda
Agenda

  • US Country Profile

  • Germany Country Analysis

    Social

    Political

    Cultural

    Economic

    Labor regulations

    Expatriation

  • Wal-Mart Case

  • Recommendations


The us industrial relations
The US Industrial Relations

  • Not as politically entrenched as in Germany

  • 15.5 million labor members

  • Men more likely to join than women

  • The public sector has higher members than the private sector


The us labor union membership
The US Labor Union Membership

Source: Adapted from data obtained from the Bureau of labor and Statistics; www.bls.gov


The us labor union demographic
The US Labor Union Demographic

Source: Adapted from data obtained from the Bureau of labor and Statistic; www.bls.gov



Social structure
Social Structure

  • Population peak at 82 million

  • Various cultures

  • Diverse religions


Social structure cont d
Social Structure (Cont’d)

  • The Elite

  • The Self-employed

  • Salaried employee

  • The Workers


Political stages
Political Stages

  • Federal Republic

  • Parliamentary system based on constitution

  • Three bodies to check and balance


Culture
Culture

  • Entrepreneurship and open competition is not encouraged

  • Labor unions are extremely powerful

  • Capitalism is not favored


Culture cont d
Culture (Cont’d)

  • Open competition is crucial for economic growth

  • Cooperative economy

  • Use of consensual business model


Culture cont d1
Culture (Cont’d)

  • No capitalism – social market economy instead

  • No strong CEO

  • Job security and stability for years

  • Protection Against Dismissal Act


Economy
Economy

  • One of world’s most important economic powers

  • Fluctuation in GNP

  • Heavily export oriented


Industrial relations
Industrial Relations

  • Organized at the industry-level

  • Forbid “employment at will”

  • Require at least 1 labor representative or work council per company

  • German culture more rigid than the American culture


Trade unions
Trade Unions

  • Constitute a political force

  • Union density: 42%

  • Most unionized: employees in the public sector

    manual workers

    white-collar workers

  • Largest unions: ver.di (3 million members)

    IG Metall (2.4 million members)


Expatriate profile
Expatriate Profile

  • American PCN

  • Working within the company in Germany

  • Staying in the host country for 2 years


Becoming an expatriate
Becoming an Expatriate

  • Apply for Visa

    • Residence visa

  • Obtain a Work Permit

    • Self-Employed

    • Employee of a Company

  • Apply for Insurance


Adjusting in germany
Adjusting in Germany

  • Applying for housing

  • Obtaining a driver’s license

  • Understanding the language

  • Creating social networks


American vs german work ethics

Americans

Strong work ethics

Impersonal employer-employee relationship

Informal communication

Work importance

Germans

Strong work ethics

Good employer-employee relationship

Formal communication

Family importance

American vs. German: Work Ethics


Us responsibilities for expatriates
US Responsibilities for Expatriates

  • US Taxes

  • Voter Rights

  • Social Security


Repatriate issues
Repatriate Issues

  • Emotional

  • Social

  • Occupational



Wal mart enters germany
Wal-Mart Enters Germany

  • 1997: acquisition of Wertkauf

  • 1998:take over of Interspar

  • Appointment of US citizen, Rob Tiarks, as CEO

    • Ethnocentric approach unsuccessful

  • Turnover rate of $ 2.3 billion


Do it the wal mart way
“Do It the Wal-Mart Way”

  • Failure in the expatriation process

    • No adaptation to the German culture

    • No pre-departure training

  • Denial of differences between Germany and the United States


Why wal mart failed
Why Wal-Mart failed

  • Low price strategies did not work

  • Poor product qualities

  • Dirty stores

  • Disrespecting employees

  • Weak service

Wal-Mart in Berlin


Wal mart and labor unions
Wal-Mart and Labor Unions

  • Refuses to have labor unions

  • Does not comply with local labor laws

  • Faces huge strikes

  • Ver.di forced Wal-Mart to respect the collective agreements for commerce


Can wal mart recover
Can Wal-Mart Recover?

  • 2001: appointment of German CEO Kai Hafner

  • Management tries to make efforts to satisfy employees

  • New ethics code

    • Ban on sexual relationships between staff

    • Creation of an informer hotline


Recommendations
Recommendations

  • Recognize the cross-cultural ability of the expatriate

  • Learn the host-country language

  • Common assumption:

    ‘"Don't worry," the departing employee is told, "they all speak English over there!“’

    (Schmidt, 2004, p.3)


Recommendations cont d
Recommendations (Cont’d)

  • Provide pre-departure training

(Dowling & Welch, 2005, p. 122)


Concluding comments
Concluding Comments

  • Wal-Mart’s ethnocentric approach was a failure

  • Human resources failed to recognize cultural differences

  • Wal-Mart survival only possible if labor is allowed to organized in Germany

  • Good employee-employer relationship is the key to success


References
References

www.bls.gov

http://ssa-custhelp.ssa.gov

http://www.irs.gov/businesses/international/

http://www.overseasdigest.com/country/germany.htm

www.eurofund.gov.int

www.expatexchange.com

Dowling, P. J.& Welch, D. E. (2005). International human resource management (4th ed.). Mason, OH: Thomson/

South Western.

htt://www.ebusinessforum.com/index.asp?doc_id=4968&layout=rich_story

http://www.commondreams.org/views04/0615-10.htm

http://geogate.geographie.unimarburg.de/vgt/english/brd/module/m1/u10.htm

http://www.sietareuropa.org/about_us/Newsletter/Jun04/BridgingtheInterculturalGap.html

http://www.usembassy.de/germany/working_in_germany.html

http://www.germany-info.org/relaunch/business/trends/basics_system.html



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