Introduction
The cultural implications of the host country play a crucial role in decision-making for international enterprises. As with any other company domain, for instance, partner communications, staff management, and their expectations vary based on culture. In the United States, for instance, it is normal to use informal names in business correspondence. Similarly, in the majority of European nations, one must utilize titles while addressing coworkers (Reynolds, 2017). With employee voice, employees have varying expectations regarding their participation in the firm's management and inclusion of their perspectives when making arrangements, either directly or through representatives.
MNCs is an abbreviation for "multinational corporation," which refers to a business that operates in multiple nations. Culture lacks a cohesive and widely accepted definition. According to Hofstede, this phenomenon might be viewed as "collective mental programming of the human mind" (Compare countries, no date, para 1). Culture influences the habits and expectations of employees, such as their attitudes toward participation in the firm's decision-making, from a business perspective. Next, employee voice is a collection of structures and processes that allow employees to participate in a company's decision-making process (Boxall and Purcell, 2013).
These three concepts are interconnected because multinational corporations (MNCs) operate in multiple countries with diverse cultures, which impacts the employees' and outsiders' expectations regarding the significance of employees' voice and their participation in the firm's decision-making. This study examines the role of culture in the context of employee voice for multinational corporations.
Employee Opinion
In certain nations, employee voice is deemed crucial, yet in others, it is perceived as something that does not add to the outstanding decision-making and management of an organization. Wilkinson, Barry, and Morrison propose an alternative definition of the idea of "employee voice" to the one included in the beginning of this study (2020, p. 100677) —“employee voice” refers to all the means by which employees strive to have a say in and influence their work and the operation of their organization. ’ Examples include integrating employees in the company's planning process, communicating with employee unions to reflect on existing policies, as well as various forms of communication.
Aside from decision-making, employees frequently have insights on workplace issues, such as illegal actions by coworkers or unethical commercial practices. CIPD (2020, para. 5) notes that whistleblowing is an example of employee voice when an employee expresses concerns about an issue to either management or a regulator. Included among the topics that employees may wish to discuss are illegal conduct and hazardous working conditions.
This is an example of the so-called "speak up culture," in which employees are encouraged to discuss issues rather than ignoring them. According to the Public Interest Disclosure Act of 1998, these whistleblowers get legal protection (CIPD, 2020). Therefore, employee voice is a sort of participation in the firm's decision-making and control over its ethical and legal procedures.
Various Forms of Employee Voice
There are a variety of ways in which employee voice might manifest; for instance, it can be direct or indirect, individual or collective. Aside from these categories, which are related to cultural differences between nations, in some jurisdictions employee voice is not recognized as a necessary component of company governance. Due to their social hierarchies, India and China do not historically prioritize the inclusion of personnel in management, for instance (Warner, 2018). In many states, therefore, providing employees a voice is not deemed necessary.
With both direct and indirect representation, the emphasis is on how employees express their thoughts. Either each person does this independently, or the personnel choose representatives of their collective opinion. Direct voice is defined by Cvenkel (2020) as an employee's access to a two-way communication channel with their management. Examples include open-door policy, in which any employee may approach a supervisor, and team briefings. Various sorts of assessments, including 360-degree reviews and performance evaluations, as well as team briefings, offer the chance to discuss concerns (Ruck, 2017).
In most Anglo-Saxon countries, including the United Kingdom, Australia, and the United States, direct voice is preferred. In indirect speech, a representative instead of each employee talks with the company (Kwon and Farndale, 2020). Work committees, councils, such as the European Work Council, and trade unions are examples. France, Sweden, and Germany are among the European nations that continue to support this style of representation.
Employee feedback can pertain to various aspects of a company's operations. Other examples include working environment, remuneration, rules and procedures (Wilkinson, Barry, and Morrison, 2020). In some nations in Germany, for instance, a work council dubbed EWC is required to approve decisions that would effect the employees (What is the difference between a German- and French-style EWC?, no date). Due to the considerable engagement of these councils in the operation of the company, several multinational corporations have opposed their regulatory authority.
Cultural Implications
In jurisdictions where employee input is seen essential for corporate decision-making, the notion is that it adds to the success of the organization. According to Ruck, Welch, and Menara (2017, p. 904), "employee engagement is recognized as essential to organizational effectiveness and as a factor in achieving innovation and competitiveness."
The cultural variations and differing perspectives on employee voice between host countries and home states often lead to misunderstandings between management and workers. For instance, if a CEO comes from a culture where employee voice is respected, but works in China, where this idea is meaningless, they may be unable to make appropriate judgments since employees will be unable to participate in the planning.
In addition to differing perspectives on the importance of employee voice, there are several approaches to employee representation in organizations. There might be a direct or indirect expression of an employee's voice, as well as a distinction between the preferred forms of the host and home states. Examples of indirect representation are munitions, trade committees, and work councils, in which one or more employees are appointed by their peers to express the views of the majority.
France, Germany, and Sweden are countries that favor indirect voice (Cvenkel, 2020). State per state, attitudes towards labor unions and work councils vary. Cullinane et al. (2017) provide a case study based on the 2002/14/EC Directive, which governs business communications. This regulation was intended to establish a status for employer-employee contacts in the United Kingdom and Ireland, when no such framework existed previously. Previously, employee voice regulations were largely voluntary and controversial, thus this order helped to the enhancement of non-union communication.
Therefore, direct representation requires hearing each individual's perspective separately. This sort of employee voice is becoming increasingly significant, and more governments are accepting it. For instance, "South Africa has transitioned from autocratic racial Fordism to more inclusive paradigms that combine collective bargaining and direct forms of voice" (Wilkinson et al., 2018, p. 711). This shift is comparable to China's, which involved the blending of Westernized techniques with indigenous customs.
From a theoretical standpoint, Hofstede's Cultural Dimensions serve to explain differences in employee voice perception and representation kinds. This paradigm was established using a cross-cultural communications theory as its foundation. According to this theory, there are five primary domains that can be used to evaluate a culture: Power Distance (PDI), Individualism vs. Collectivism (IDV), Masculinity vs. Femininity (MAS), Uncertainty Avoidance (UAI), and Long-Term Orientation (LTO) (National culture, no date, para. 1).
Each of these categories represents the distinct preferences of the residents of this state. In states where individualism trumps collectivism, for instance, individual representation will be prized above trade unions and work commissions, and vice versa. Likewise, power distance may explain why certain regimes, such as India and China, do not promote the use of employee voice.
Hofstede’s culture dimensions can be employed to study the preferences of employee voice manifestation in different situations due to the fact that culture is a collective programming that develops specific mental patterns, allowing one set of individuals to be distinguished from another. However, its shortcoming is the dynamic nature of globalization and international business.
Case Studies
In the United States and the majority of European nations, employee input is a crucial factor in business decision-making. In China and India, however, the concept of employee voice is less significant than in Western nations. In their presentation of the hybrid model, Huang, Weng, and Hsieh (2016) discuss a case study from these nations that demonstrates how using employee voice in a culture that does not accept this concept can be detrimental to the firm.
According to the writers, "the absence of employee voice has become a major issue in China" (Huang, Weng, and Hsieh, 2016, p. 19). This may indicate that the global corporate culture has had an impact on China, resulting in varied approaches to corporate governance among local enterprises. According to the authors' study, the concept of employee voice in China has shifted in recent years, with many adopting a more Western approach.
In an effort to blend the global and local corporate and national cultures, a hybrid model known as 'democratic management' arose, which allows employees to participate in the decision-making of MNCs. Clearly, this is a product of global impact and the necessity to adapt to global governance techniques, but this does not imply that all local particulars have been highlighted.
The nature of employee voice preferences is evolving in both the European and American governments. Bryson et al. (2019) explore the Anglo-American approach, which has generally favored indirect employee participation through unions. In Canada, the United States, and the United Kingdom, trade unions that were popular throughout the industrial age are now on the decrease. Bryson et al. (2019) hypothesize that this is due to a shift in employee preferences from a preference for indirect representation to a preference for the direct voice. Instead, corporations and employees in these Anglo-Saxon nations adopt the ‘never-memberships’ and alternate voice models.
Intriguingly, the notion of employee voice and human resource management implies that indirect employee voice is still favored in some nations, such as the United States and the United Kingdom. Recent research by Bryson et al. (2019) demonstrates a gradual loss in the unions' influence, which is causing certain perception shifts about employee voice.
Consequently, one must be aware of cultural nuances, such as a preference for indirect representation and participation, and comprehend the new forms of employee voice. For instance, Holland, Cooper, and Hecker (2016, p. 2621) identify social media as a new type of worker representation since social media sites have evolved into ‘powerful communication tools both inside and outside the workplace. ’
Implications for multinational corporations
The culture of the host country should influence the management strategy of multinational corporations. This is essential because, as demonstrated in the preceding sections, there are considerable disparities in how various nations view employee voice, which can lead to problems with corporate decision-making. According to CIPD (2020), research indicate that the usage of employee voice contributes to the performance of a company since it influences the well-being and motivation of employees, as well as productivity, innovation, and the reduction of workplace conflicts. Tsang and Yan (2018, p. 3) reach similar conclusions, saying that employee voice adds to a ‘discretionary vocal exchange of ideas, proposals, or opinions with the goal of enhancing organizational functioning. ’
Changing a governance structure on a country-by-country basis may provide difficulties for multinational corporations. This presents the difficulty of designing a unified system that takes into account national variances in employee voice attitudes or is adaptable enough to allow for the modification of these practices. Global standards and local responsiveness, as defined by Bartlett and Ghoshall, are two widely acknowledged strategies for multinational corporations to manage employee input (Cvenkel, 2020).
The former entails aligning branches in different states with the objective of establishing a transparent system. This strategy is market-efficient and fosters a sense of parity across sub-branches. The latter entails modifying the system country by country. Respect for the local values and traditions is the foundation of local responsiveness, which helps retain the commitment of the workforce.
The MMC's work in this sector can be explained using Perlmutter's ERPG model. "ethnocentric, polycentric, and geocentric" are the three dimensions of Perlmutter's ERPG paradigm (Cvenkel, 2020, p. 67). The first aspect entails employing employee voice practices from the host country, the second from the MNC's home country, and the third allows for the selection of the most suitable strategy.
Consequently, multinational corporations must balance global uniformity and local responsiveness in their employee voice programs.
Case Studies
To understand the significance of employee voice, one must examine case studies that highlight the challenges faced by management when employee voice is misinterpreted. Hyman (2018) addresses employee voice perspectives in China, where trade unions are federated but there is little genuine connection between representatives and management. In addition, the Chinese ACTFU is the only legal trade union in the state, and all other unions must be affiliated with it. Therefore, this approach may be odd for a manager from an Anglo-Saxon country who views labor unions as independent organizations.
Belizon (2018) compiled a sample of replies from 240 multinational corporations operating in Spain to determine the challenges they experienced. First, the study emphasizes that numerous U.S. corporations refuse to participate in employee representation systems. This is problematic since in several European Union nations, employers are required by law to cooperate with unions, and refusal to do so leads in fines (Belizon, 2018).
In several of these Western European nations, including Spain, enterprises employing more than fifty people are required by law to have a formal affiliation with a union or representative organisation.
Belizon (2018) believes, based on the author's study, that British MNCs operating in Spain often adopt a localized strategy and adhere to an employee voice structure that is approved in Spain — formal cooperation with indirect representatives. United States multinational corporations tend to avoid collaborating with unions in host nations, but in Spain, they are legally required to do so. Still, Belizon (2018) concludes that US-based MNCs favor direct representation even in Spain.
This case study suggests that employee voice is affected by multiple factors, including the culture of the host state, legislations, and the preferences of the MNC’s home state, as shown by