Human Resource Management
Week 2 Assignment
August 30, 2012

Chapter 2
Learning Exercise 2

1. Small businesses comprise a major portion of the U.S. economy. Larger companies typically have more resources to hire staff dedicated to supporting the management of employees than do smaller companies, which often lack formal HR departments to provide similar support. This does not eliminate the need to attend to people issues in smaller companies; rather line managers or company owners must perform HR practices in addition to their other activities. Also, smaller businesses often do not have the resources to provide the same level of pay, benefits, and training opportunities to employees as larger companies.

2. Although small companies often do not have the same type or level of resources enjoyed by larger companies, the importance of effectively managing employees may be magnified in smaller companies. With a smaller staff, managers may expect employees to display greater autonomy and discretion. As a result, the types of knowledge, skills, and abilities that employees may need in small versus large companies, even for the same job, differ. Furthermore, in contrast to large operations, in a small company, the performance of each employee is likely to have a larger, more direct impact on company success.

3. Yes, it would influence my decision about how to manage my employees. The pressures of managing employees in a young, startup company are different from those in a mature organization striving to protect its established market share and competitive position. The objectives and needs of companies at different stages of development introduce new and distinct challenges for effectively managing employees. While young companies tend to focus on growth and survival, mature companies may be more concerned with customer retention and perhaps extending their operations into new markets for further opportunities. Additionally, mature companies often have more resources to support staff, as well as established policies and procedures, for handling employee-related issues. Young companies face pressures to identify and hire people who can help the company grow. Given the limited resources that small companies typically have for pay and other benefits, it is sometimes very difficult for small firms to attract top-notch employees. As companies mature, the pressures regarding the management of employees evolve as well.

Case Study 2

1. Labor Force Trends: In 1997, Levi Strauss closed 11 plants and laid off about 7,400 employees to cut off excess production. In 1999, Levi’s announced a large-scale layoff of almost 6,000 jobs and the closing of more factories in Georgia, North Carolina, Virginia, Texas, Tennessee, and Arkansas in an effort to move production to foreign facilities. Over time the layoffs and the closings continued. Technology influenced the decision to move by production cost and a cheaper way to produce a larger amount of products. Globalization influenced Levi’s decision to move to outside the United States by lower cost to make products in foreign countries. What might cost $6.67 to make in the United States costs about $3.00 in Mexico and $1.50 in China. Ethics and Social Responsibility was an influence because Levi Strauss relocated outside the U.S. for what seemed to be the right decision to produce more at lower costs. Costs were a major factor for this decision to relocate. So to continue to produce their jeans the decision had to be made to relocate to foreign countries.

2. From a business perspective I would say Levi Strauss did make a good decision to relocate outside the United States. In order to keep the industry operating he had to relocate his factories where the cost to make products was cheaper. From an ethical perspective I do believe he made what he thought was the right decision and obviously was because Levi Strauss denim is still being produced and sold today.

3. First, cultural differences affect what HR practices and management decisions employees deem acceptable. For example, employees in a collectivistic culture may be less receptive to placing a strong emphasis on individual performance in reward systems and performance management systems than those in a more individualistic culture. Similarly, individuals from a high power distance culture may accept a work environment that emphasizes multiple layers of hierarchy and strong status distinctions between managers and employees more easily than those from a low power distance culture. Second, cultural differences also influence which HR activities managers and supervisors view as appropriate for how they manage employees. Asking managers in a high power distance culture to encourage employee participation and decision making might be viewed as contrary to their strong values for maintaining status differences. Similarly, companies might encounter resistance when asking managers to reward individual achievement in collectivistic cultures that value the community more than the individual.