Discuss about the Decision Support as Knowledge Creation.
The reported study has been developed to support a relocation decision of a manager of Toyota Motor Corporation’s Melbourne Manufacturing Plant, Australia to a sister plant located in the United States of America. As a Human Resource Manager, it is the responsibility to identify the current scenario of the car industry in the US. Precisely, through the identification of the impact of Donald Trump’s presidency on the business industry and the economy, the existing environmental analysis of automobile industry in the US has been briefed. The background briefing report will be evident for the manager to identify the differences in the employee relations and human resource management (Hertwig 2015, p. 331). By outlining the differences of the human resource management issues and employment relations in the US and Australia, the influencing factors affecting the working life of the manager will be illustrated. The relocation decision of the manager to the US manufacturing plant in 2017 must be handled effectively so that the expatriate employee will deliver premium working quality in the foreign country i.e. the US.
By order of the management, the reported study has been described to investigate the current environment analysis of the automotive industry in the US as well as Australia. In addition, the study will evaluate the leading HRM issues and employment relations issues that must be taken into consideration by the expatriate manager at the new located manufacturing plant of Toyota Motor Corporation in the US (Kehoe 2017, p. 22). The analysis of the study will be helpful for the expatriate manager to understand the difference of HR issues and employment relations issues in the US to that of in Australia. According to the outcome of the analysis, the manager needs to outline his job responsibilities to fit in the new workplace. To make the expatriate operation successful, the background briefing report will be essential to provide significant information to the manager who will be relocated in the US-based manufacturing plant of Toyota Motor Corporation.
The vehicle manufacturing industry in the United States of America has been primarily affected by the policies of the US President, Donald Trump. On a bigger perspective, the political condition and the policies of the US president will be the defining factors for automakers in the US market. Recently, most of the leading automobile manufacturers operating in the US car industry have been reluctant to set up new manufacturing plants (Evans 2017, p. 2). Alternatively, the latest policies, safety guidelines, and improved business environment can support the business proceedings of the automakers. In the other hand, flattening sales figure of the automobile industry has been another reason for the US automakers to increase the production plants in the territory (Garcia 2017). Evidently, the efficiency of the motor industry in the US can boost the GDP growth creating a positive outlook for the economy in the upcoming years.
The new Republican president of the United States of America has urged the leading automakers of the country to increase production line within the US territory so that the employment condition in the US will be boosted. The policies of Donald Trump are directed to create a number of jobs for Americans counterparts (Dawson 2017). Reportedly, the economic, as well as trading policies of the new president of America can be the biggest opportunity for the automakers in the US. The president has vowed that leading automakers must concentrate on manufacturing automotive in the country rather that developing manufacturing plans elsewhere. Admittedly, such policy of Trump will benefit the US automakers for sure (O’Sullivan & Turner 2013, p. 701). Notably, in the upcoming years, the job-creating president, Donald Trump will increase the pressure on the US automakers to increase production in the US plants. Furthermore, Trump has vowed to the cut taxes and statutory regulations imposed on the US car industry to make the sector more attractive for automobile manufacturing corporations (Greacen & Chou 2015, p. 387). By considering the policies of Donald Trump, the operations of motor manufacturing companies will be affected in a great deal.
The Australian automobile industry is shifting gear on a rapid scale as the sale of the automotive is up by 2 percent on a yearly basis. During the year 2016, the car industry in Australia has registered strong growth due to increase in demand from the target demographics. According to the report, the SUV category sale is up by 8 percent as Toyota Motor Corporation is the leader of the pack. In 2016-17 financial years, Toyota, Holden, and Ford have decided to shut down their Australian manufacturing plants. Therefore, the production of Australian-made automotive has reduced. Basically, the growth of the demand in the car industry has made a massive impact on the car sales. Reportedly, most of the Australian states such as New South Wales, Victoria, South Australia, and Tasmania have witnessed an increase in automotive sales.
Notably, sound economic growth factors and improved financial status of the Australians have increased the growth of the automobile industry in the country. Precisely, the number of manufacturing plants has been decreased in the recent years. Leading to the event, Japan and Thailand have become two major sources of automobiles for the targeted Australian market. As a result of that, the production of cars in Australia has slumped (Cornette & Pontier 2012, p. 177). Meanwhile, the sales of the automotive industry have picked up in a recent couple of years whereas the car manufacturing in Australia has declined. By considering the current market analysis, most of the leading car manufacturers operating in the Australian market have concentrated on sales in Australia rather than setting up new manufacturing units in the target locations.
Modern factors of globalisation have led to different HRM issues to the context of the target market. For instance, the HRM issues in the United States of America will be different to that Australia. Therefore, an analysis of the HRM issues in the United States of America has been discussed in the study to identify the leading aspects of management practices and workplace policies of the US based companies (Barkin 2016, p. 886). Leading to the event of HRM issues, being a developed country, the HR challenges are different in the United States. First of all, the improved labour market condition and technological development in the US market can be difficult for the management of the US-based firms to select the best talents. Meanwhile, the expatriate manager needs to be smart enough to select the most efficient workers (Joetan & Kleiner 2014, p. 51). On the other hand, impact of the economic indicators around the country can be identified another substantial issue in HRM. Based on the GDP growth rate, inflation, unemployment rate, and economic policies, hiring decisions and HR decisions have to be modified according to the demand of the day. Most importantly, diversity management due to globalisation has become one of the most crucial challenges for managers in US-based organisations.
Alternatively, data-driven human resource practices and policies have replaced the conventional strategy making of HR in the US business environment. By using efficient software to generate key data and information, managers have made decisions to complete hiring of new talents, compensation and benefits, and employee retention planning. Precisely, in-depth analysis and use of modern metrics must be used by the professional managers to evaluate the performance of the employees. Therefore, the expatriate manager must identify such functional differences used in the US companies (Brondoni 2013). In addition, the role of union and employee contracts must be analysed based on the legal frameworks. Therefore, it is the responsibility of the managers to identify the employee bargaining contracts and labour laws associated with the workforce to avoid any legal obstacles. Significantly, demographic changes have created a common issue in HRM. For instance, ageing workers, individual role of the employees, and responsibility towards the job position must be rightly identified by the managers to make the correct decision at the right time (Pethokoukis 2016, p. 15). Hence, it is important for a manager shifting to a new production facility in the USA to observe and understand the HRM issues for effectively working in the new environment.
The changes in the employment relations have been a major subject of discussion in different industrial nations such as the United States. It is important for a manager to be aware of the different local, states and federal laws and doctrines that governs the employment relationship in automobile industry of the United States (Chawinga & Chipeta 2017, p. 33). For example, the manager must know about the National Labour Relations Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Fair Labour Standards Act, the Family and Medical Leave Act, the Equal Pay Act and several other employment relationship rules and regulations that controls the employment market in the country (Deakins, 2016).
Arguably, the above stated laws are quite mandatory for an organisation to legally operate in the US market. According to the current market scenario, unionise activities can be highly evident in the US automobile market due to the growing intervention of the political powers (Deakins, 2016). Hence, there is a need of developing collective bargaining agreements with the labour union to minimise any sort of workplace conflicts. On the other hand, any sort of discrimination in the terms of age, disability, religion and gender is not tolerated in the US automobile market. There are several laws governing the discrimination of employees at workplace that must be maintained while developing the HRM policies (Ritchie, Komo, & Ngugi 2013, p. 86).
The Title VII of the Civil Rights Act of 1964 prohibits employers from refusing to hire, discriminate or discharge an individual in terms of colour, race, sex, religion, and national origin. On the other hand, there are several states that mandate additional regulations over the federal laws. Furthermore, the Age Discrimination in Employment Act prohibits employers from discriminating and discharging employees on the basis of their age (Deakins, 2016). Furthermore, the Family and Medical Leave Act protect the rights of the employees to take leave in case of emergencies and medical problems. Additionally, the Fair Labour Standards Act makes its mandatory for the employers in the automobile sector to provide statutorily prescribed minimum wages to all its employees without any discrimination.
Hence, it is important for the manager to know and understand the current regulatory frameworks governing the employment relations in the US automobile market. Furthermore, the manager must have proper knowledge of the current government policies in order to effectively manage the workforce in the sister manufacturing plant of Toyota in the United States (Casadesus-Masanell & Zhu 2012, p. 477). Therefore, it is important for the manager to understand the legal issues to effectively work in the United States of America.
By considering the above analysis, it can be seen that the competition in the Automobile industry in the Australia is at its peak due to the increasing invasion of the foreign companies. On the other hand, the foreign firms have good opportunity in the Australian market to expand their businesses (Vlasic & Boudette 2017, p. 20). On the other hand, the current situation in the US market is quite difficult to handle due to the changing laws and policies of the federal government. The company needs to offer employment opportunities to the local people to survive and smoothly operate in the US market (Lippert 2017, p. 37). On the other hand, the management must consider the changing employment laws to keep the company safe from legal obligations.
Furthermore, the cost of labour in the US market is continuously increasing in the recent years, which is expected to increase to around a minimum of $15 per hour in the upcoming years. On the other hand, the minimum wage rate in the Australian market is around $17.70 per hour that is quite lower than the US market (Nuttall, 2017). Furthermore, the US government will provide subsidiaries to the automobile manufacturers to develop manufacturing plants in the US market. Hence, the US market has a better growth potential in the future as compared to the Australian market (Steiger 2010, p. 33). But, the manager needs to consider the legal obligations and current trend in the employment relations and HRM practices to effectively manage the operations of the firm.
On the basis of the above analysis, the following recommendations are suggested to the expatriate manager to effectively work in the automobile manufacturing plant in the United States of America.
Conclusion
By considering the above analysis, there is several differences between the HRM practices used by the automobile companies in the United States and Australia. On the other hand, the economic policies of the US government have changed in the recent years that may make it difficult for the new manager to effectively work in the new market. Additionally, there are several rules and regulations that guide the employment relations in the United States of America. Hence, it is important for the manager to understand the laws and policies of the government to effectively manage the operations of the sister manufacturing plant in the United States of America. The manager must focus on providing adequate jobs to the Americans and develop good employment relations with his employees to seek growth in the new market. Finally, the manager must develop international HRM knowledge to control the diverse workforce effectively. Conclusively, the manager must understand the differences between the HRM practices of the automobile manufacturers in the United States and Australia to successfully perform his job.
References
Barkin, S, 2016, ‘Shifting Gears: Changing Labor Relations in the U.S. Automobile Industry’, Journal Of Economic Issues, vol.20, no. 3, pp. 875-881.
Brondoni, S, 2013, ‘Innovation and Imitation for Global Competitive Strategies, The Corporation Development Models of US, Japan, Korea, and Taiwan’, Symphony Emerging Issues In Management, (1).
Casadesus-Masanell, R, & Zhu, F 2012, ‘Business model innovation and competitive imitation: The case of sponsor-based business models’, Strategic Management Journal, vol.34, no. 4, pp. 464-482.
Chawinga, W, & Chipeta, G 2017, ‘A synergy of knowledge management and competitive intelligence’, Business Information Review, vol.34, no. 1, pp. 25-36.
Cornette, G, & Pontier, S 2012, ‘Transactional marketing versus relationship marketing: the US automobile market evolution’, International Journal Of Automotive Technology And Management, vol.2, no. 2, pp. 177.
Dawson, A 2017, Trump Says ‘No Way’ to Toyota Plant in Mexico’, WSJ. Retrieved April 2017, from https://www.wsj.com/articles/trump-says-no-way-to-toyota-plant-in-mexico-1483643183
Deakins, O 2016, ‘Managing the employment relationship in the United States’, Lexology.com. Retrieved April 2017, from https://www.lexology.com/library/detail.aspx?g=4a5227d0-a1da-439b-baa3-475478a5ad7b
Evans, S 2017, ‘Toyota to axe 2600 jobs when car-making stops on October 3’, Australian Financial Review, 1 February, p. 2.
Garcia, F 2017, ‘Donald Trump just threatened one of the world’s biggest companies’, The Independent. Retrieved April 2017, from https://www.independent.co.uk/news/world/americas/donald-trump-toyota-baja-california-plant-jobs-twitter-latest-a7511981.html
Greacen, J, & Chou, D 2015, ‘Offshore outsourcing impact: an analysis of the US automobile industry’, International Journal Of Management And Enterprise Development, vol.2, no. 4, pp. 387.
Hertwig, M 2015, ‘European Works Councils and the crisis: change and resistance in cross-border employee representation at Honda and Toyota’, British Journal of Industrial Relations, vol. 53, no. 2, pp. 326–349.
Joetan, E, & Kleiner, B 2014, ‘Incentive practices in the US automobile industry’, Management Research News, vol.27, no. 7, pp. 49-56.
Kehoe, J 2017, ‘Trumponomics: Wall St or economists wrong’, Australian Financial Review, 30 January, p. 22.
Lippert, J 2017, ‘The new White House seriously tests Toyota’, Australian Financial Review, 27 January, p. 37.
Nuttall, S 2017, ‘2016 Vehicle Sales – Trends in the Australian Automotive Market’, Acaresearch.com.au. Retrieved April 2017, from https://www.acaresearch.com.au/australian-market-research-blog/are-we-reaching-peak-automotive-in-australia-a-review-of-2016-vehicle-sales
O’Sullivan, M & Turner, T 2013, ‘Facilitators and inhibitors of collective action: a case study of a US-owned manufacturing plant’, British Journal of Industrial Relations, vol. 51, no. 4, pp. 689-708.
Pethokoukis, J 2016, ‘Downsides of Trump’s Carrier deal’, Australian Financial Review, 3-4 December, p. 15.
Ritchie, G, Komo, L, & Ngugi, I 2013, ‘Key success factors of small businesses’, International Journal Of Business And Globalisation, vol. 11, no. 1, pp. 86.
Steiger, D 2010, ‘Decision Support as Knowledge Creation’, International Journal Of Business Intelligence Research, vol. 1, no. 1, pp. 29-47.
Vlasic, B &Boudette, N 2017, ‘Carmakers react to Trump threats’, Australian Financial Review, 11 January, p. 20.
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