CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Every organization shares a common objective of addressing challenges through the provision of products, services, or both. This primary goal shapes the organization's mission, vision, and core values. The achievement of this objective heavily relies on human effort since individuals possess valuable knowledge and expertise that organizations can and should leverage. Hence, in the current context, the recruitment and retention of competent employees play a vital role in an organization's success (De Kok and Uhlaner, 2001).
Human Resource Management (HRM) plays a critical role in ensuring that organizations attract and retain the right talent necessary for their prosperity. HRM encompasses a wide range of activities, including recruitment, training, compensation, policy development, and the formulation of strategies to maintain a skilled workforce. In the last two decades, HRM has undergone significant transformations, increasing its significance in the modern organizational landscape (University of Minnesota, 2023).
The practices and challenges of Human Resource Management (HRM) can significantly differ based on cultural contexts. Culture, with its intricate web of shared beliefs, values, norms, and behaviors within a society, profoundly influences how individuals and organizations perceive and handle human resources. Cultural values act as external factors that shape HRM exercises and guide employee behavior (Tutorials Point, 2023).
Cultures play a crucial role in determining approaches to people management, which means that cultural differences necessitate variations in management practices (Newman and Nollen, 1996; Trompenaars et al., 2004). Among all management practices, human resource management (HRM) appears to be particularly susceptible to cultural differences, with potential implications for their design and appropriateness (Noe et al., 2006; Stone et al., 2008; Trompenaars et al., 2004).
The divergent perspective in international HRM suggests that cultural differences lead to variations in individual perceptions and preferences (Laurent, 1986), which, in turn, shape organizational behavior, including aspects such as work motivation, communication, conflicts, work orientation, goal definitions, performance appraisal, rewarding, decision-making, and management style (Hofstede, 1980). Hofstede (1983) goes so far as to state that "the convergence of management will never come" (p. 89).
Economic theory acknowledges the significant role of culture in shaping the behaviors of individuals and institutions. It suggests that, in addition to formal institutional contexts, the informal aspects of culture, referred to as "cultural socialization," exert influence on the governance structures that coordinate individual actions within organizations (such as working contracts) and also impact the preferences and utility functions of the actors involved (Wolf and Pooria, as cited in Festing, 2006, p. 456).
This highlights the importance of studying the impact of Culture on Human Resource management. Thus the aim of this study.
1.2 Statement of the Problem
The interaction between culture and HRM has been widely acknowledged in the academic literature. However, there is still a limited understanding of how culture specifically impacts HRM practices in multinational organizations, particularly in the Nigerian context and more specifically in Aba. This study seeks to address this gap by examining the influence of culture on HRM within Total Energies, Aba.
Total Energies is a large-scale multi-energy company engaged in the production and distribution of oil, biofuels, natural gas, green gases, renewables, and electricity. With a workforce exceeding 100,000 employees as of December 31, 2021, and representation from nearly 160 nationalities, the company encompasses a wide array of professions across production, sales, marketing, and support functions (740+ professions).
Given the size and diversity of the Total Energies workforce, this study aims to identify the challenges and opportunities that arise due to the cultural context and explore how the organization navigates them.
1.3 Aim of the Study
The main aim of this research is to explore and analyze the impact of culture on HRM practices within Total Energies, Aba.
1.4 Objectives of the Study
To achieve the main aim, the specific objectives of the study are:
- To examine the cultural factors that influence HRM practices within Total Energies, Aba.
- To identify the challenges and opportunities that arise due to the cultural impact on HRM.
- To assess how Total Energies adapts its HRM strategies to align with the cultural context.
- To provide recommendations for improving HRM practices in a culturally diverse organizational setting.
1.5 Research Questions
To guide the research process, the study will address the following questions:
- What are the key cultural factors influencing HRM practices within Total Energies, Aba?
- What challenges and opportunities arise from the cultural impact on HRM?
- How does Total Energies adapt its HRM strategies to align with the cultural context in Aba?
- What recommendations can be proposed to enhance HRM practices in a culturally diverse organizational setting?
1.6 Research Hypothesis
The study will test the following hypothesis:
H0: There is no significant impact of culture on HRM practices within Total Energies, Aba.
Ha: Culture significantly influences HRM practices within Total Energies, Aba.
1.7 Justification of the Study
This research is significant for several reasons. Firstly, it will contribute to the existing body of knowledge on the relationship between culture and HRM in the context of Nigerian organizations, providing valuable insights for scholars and practitioners. Secondly, it will offer specific recommendations to Total Energies, Aba, and similar multinational companies on how to effectively manage their workforce in culturally diverse settings. Lastly, the study will serve as a foundation for further research on HRM and culture in the Nigerian business landscape.
1.8 Scope of the Study
The study will focus solely on the impact of culture on HRM practices within Total Energies, Aba. It will encompass an in-depth analysis of the cultural dimensions that affect various HRM functions, such as recruitment, training, performance management, and employee motivation. However, the research will not extend to evaluating the overall organizational culture of Total Energies globally but will concentrate on the specific cultural context in Aba.
