Management in a Global World: Zespri

This report discusses the case study of Zespri International and the human resource problems faced while establishing new business units in China and Brazil. It highlights the issues of cross culture, lack of management, and lack of proper training and development. The report provides probable solutions and recommendations for effective management in a global workplace.

Running head: MANAGEMENT IN A GLOBAL WORLD
Management in a Global World: Zespri
Name of the Student
Name of the University
Author’s Note:

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Table of Contents
1. Introduction............................................................................................................................2
2. Discussion..............................................................................................................................2
2.1 Brief Idea of the Case Study............................................................................................2
2.2 Identifying Problems of Human Resource faced by Zespri for establishing new
Business Units in China and Brazil........................................................................................3
2.3 Probable Solutions to the Human Resource Problems highlighted for Zespri
International...........................................................................................................................7
3. Conclusion............................................................................................................................10
4. Recommendation..................................................................................................................11
References................................................................................................................................12

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1. Introduction
Human resource management in a global world or international human resource
management could be referred to as the collection of numerous activities, which target HRM
at the respective international level (Brewster et al., 2016). HRM is mainly concerned
regarding management of staff in any 1 nation and the international HRM concerns about
management of the employees outside the home country and hence enhancing diversification
to a high level. All types of additional activities related to human resource management are
being concerned for expatriating management. Numerous popular and significant
organizations are doing businesses in the global world and thus it is required for them to
involve IHRM in their business (Bratton & Gold, 2017). The following report will be
outlining a brief analysis of the case study of Zespri International with various details.
2. Discussion
2.1 Brief Idea of the Case Study
Zespri is a popular and significant organization that deals with kiwi fruit and provides
it to their customers. They have currently decided to start business in China and Brazil.
However, the operation in China was being rocked by numerous scandals and controversies
after involvement of the distributors of Zespri. Hence, the fine of the Chinese subsidiary was
around 1 million dollars and the respective employee was eventually jailed for next 5 years
for the underpayment of custom duties on kiwi fruit imports during the duration of 2008 to
2010. Currently the scandal did not involve kiwi fruit of New Zealand, however nine staff of
this organization were arrested for this purpose. For these issues, the board of directors of
Zespri took the decision that they have to include more people in Chinese market for
management and monitoring their distributors.

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2.2 Identifying Problems of Human Resource faced by Zespri for establishing new
Business Units in China and Brazil
Zespri has the decided to expand their business to China and Brazil for the purpose of
establishment of new business units. Hence, they should be concerned about their
international human resource management to reduce the complexities or problems faced
while doing business in a globalize world (Clark et al., 2016). The international division
structure is majorly highlighted with this purpose and entire functional structure is being
concerned by IHRM. Moreover, the different approaches of IHRM, such as ethnocentric,
polycentric, geocentric and regiocentric are being involved by the organization to each and
every employee of the business. The different cultural preferences of employees in different
countries often significant issues for the organization and the business is highly impacted due
to such effects (Baum, 2015). However, it is often being observed that for the distinctive
tendency to become exclusive in nature, various businesses face issues due to this.
The most significant and vital issues of human resource management that are being
faced by the organization of Zespri International for their new business unit introduction in
China are as follows:
i) Issues related to Cross Culture: The first and the foremost issue of human resource
management that is being faced by the respective organization of Zespri is related to cross
culture (Al Ariss, Cascio & Paauwe, 2014). These types of issues could eventually turn into
massive disaster when the specific human resource managers do not involve any type of
effort for understanding the entire situation. The most significant aspects of this cross cultural
issues mainly include ethics, management style and communication. Such issues occur when
any particular person from a culture eventually communicates with one individual from other
culture. Zespri, before setting their business in China and Brazil, although has analysed the
entire market, they have been facing some of the most distinctive issues, which has

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eventually landed up 9 staff of a same agent, Dalian Yidu to jail. It is a huge loss to their
business (Chmiel, Fraccaroli & Sverke, 2017).
The main reason for such arrest was that they were caught in illegal customs and they
were sending kiwi fruit illegally, since importing kiwi is prohibited. As per the
communications manager of Zespri, Dalian Yidu is one of the importers of Zespri in China,
which deals with over 4% of the total Chinese volume, enhancing around 10% of the total
trade (Andresen et al., 2014). According to the annual report, Zespri had to focus on their
global compliance framework without even losing the capability of execution. There were
extra oversight of different agents as well as a customs audit of each and every direct sales
customers or market for ensuring every importer is acting accordingly with the international
customs practice.
Due to the issue of cross cultural communication, several employees from different
cultural backgrounds had been working with Zespri. Apart from the difficulty of linguistic
barrier, different employees might face issue due to cross cultural problems such as
inaccurate and hostile stereotypes (Chambel, Castanheira & Sobral, 2016). Since, the agents
or distributors of Zespri were not being monitored properly by the respective human resource
management of the organization, they got an opportunity of bringing ineffectiveness and
inefficiency in the business.
ii) Lack of Management: The second important and significant issue of human
resource management that is being faced by the respective organization of Zespri is the lack
of management. Leadership or proper management is extremely vital and noteworthy fo4
managing any business that is operating in a global workplace. Lack of leadership or
management could eventually lead to closing of the companies completely or bringing losses
to the respective business (Deery & Jago, 2015). Poorer leadership majorly results in higher

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employee turnover, increment in the costs of recruitment, prohibition in training and
development that are highly effective on the overall capability of the business for continuing
their operations.
Moreover, the organization with lack of management is unable to provide motivation
or proper guidance to the employees and hence the business can suffer major issues. Lack of
management often leads to lowering of the company morale. When employees or workers
complete their respective tasks with minimum effort, complain to one another and even
become a failure in finishing their respective work assignments within time, these employee
might be substantially suffering from the lacking of motivation for the manager, who cannot
relate to the respective employees (Machlis & Tichnell, 2019). These staff might also
perceive in inequitable treatment of few co workers, which could result in favouritism.
Furthermore, they do not have leadership required for keeping them on tasks. Due to
lack of management, the respective human resource management might not pay attention to
the various employee requirements or guiding them for allowing a balance within their
professional work and other working duties. As a result, the employee productivity is highly
hampered when the management does not effectively define all types of expectations of
performances or taking proper follow ups with the staff regarding their different productivity
levels. Issues are faced related to reduced revenues and profit losses. One of the most basic
and significant examples of this type of lack of management is in the case study of Zespri
International.
They have appointed several distributors or agents in their business for ensuring that
the new business units at China and Brazil are providing high advantages or benefits in the
business (Chelladurai & Kerwin, 2018). However, Zespri has not appointed any manager or
supervisor for taking follow ups on the Chinese market and for this purpose, 9 staffs of one

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particular agent in China were penalized and put into jail due to illegal customs of kiwi fruit
from New Zealand. These accused staff were not being monitored by the management of
Zespri International and hence the management did not have any idea regarding the illegal
customs issue. Organizational productivity hence was highly hampered and there was drop in
performances. Moreover, Zespri International lost her goodwill and brand name due to the
highlighted issue. The communications manager of the company had agreed to the factors
and have identified the accused agent as their distributor in Chinese market. Hence, the entire
issue of human resource management occurred due to lack of management in the
organization.
iii) Lack of Proper Training and Development: This is yet another important and
noteworthy issue of human resource management that is being faced by the respective
organization of Zespri International, while setting business in China (Girard & Girard, 2015).
The diversity in work force, cultural differences and linguistic barriers majorly influence on
the entire structure of training and development program. The training program eventually
enables the business in strengthening various skills, which every employee requires to
improvise in his or her career. On the other hand, the entire program for development could
eventually bring every employee to reach to the highest level, for the purpose of having same
knowledge and skills. It helps in proper reduction of any type of weak links in the
organization, who depend completely over others for the core purpose of completing the
basic work tasks.
It is extremely vital for the organization and organizational members to ensure that
every employee is undergoing proper training programs, so that better effectiveness and
efficiency in achieved in the business. This type of training is even more vital for those
businesses that are doing businesses in the global work place. An international business
becomes successful only when every employee or staff is well trained in the process. It even

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improvises employee performances as well as boosts employee morale and satisfaction. This
type of training even helps the employees to choose between the correct and incorrect paths
in business (Berman et al., 2019). The staffs are able to perform in a better manner and it
provides the employees with a better understanding of all types of responsibilities in the roles
and hence building the subsequent confidence.
Such incremented confidence enhances overall performances and providing high
profits to the organization. In the case study of Zespri International, since the employees did
not receive any kind of professional training from their senior management. The employees,
who are competent in nature and are on the top of changing industry standards substantially
help out the organization in holding a position as the strongest competitor and as a leader in
the industry. The various drawbacks of the employees are also identified with such programs
of training and development.
The entire management of Zespri had the responsibility of recruiting or involving
those agents or distributors in the respective Chinese market, who have received proper and
professional training in their business (Deresky, 2017). It would not have enhanced any issue
related to illegal customs as those experienced and trained distributors would have known
that they should not import kiwi fruit from New Zealand since these fruits are completely
prohibited. Consistency would also had been maintained in the business and the basic policies
and procedures would had been enhanced to a high level. For the core purpose of bringing
innovation and creativity in the business, Zespri gave complete responsibility to its
distributors, hence issues were being created.

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2.3 Probable Solutions to the Human Resource Problems highlighted for Zespri
International
IHRM has the basic capability of meeting all types of organizational objectives and
then achieving competitive benefits over their competitors for both international and national
level. There are various similarities of IHRM with human resource management, which
ensure that the respective organizations are gaining higher effectiveness and efficiency in
their business (Brewster, Gooderham & Mayrhofer, 2016). Human resource management
occurs at the national level, whereas the international human resource management occurs at
international level or within those organizations, who are doing businesses in global world.
The respective business has the core ability of moving their operations into another
country before effectively managing the employees for obtaining smoother operations of the
companies. Few of the distinctive reasons for the organizations for being globalized, majorly
involve technologies advancements, trade specialization as well as cost efficiency. For the
presence of international human resource management, it becomes quite easier to ensure
globalization in the business and then reach outwards to the market for successfully
recognizing the basic importance of IHRM. These companies, holding extremely little
regards or absolutely no importance for such HRM to set back and considering consequences.
The three distinctive issues that were faced by the respective organization of Zespri
International, could be eventually resolved with the help of three suitable recommendations
or solutions (Festing & Schäfer, 2014). The probable solutions to these 3 identified issues and
problems are as follows:
i) Solution to Issues related to Cross Culture: For resolving this particular issue of
cross culture, the organization of Zespri International should focus on their new strategies and
products. It would ensure that every problem related to cross culture, such as communication

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or linguistic barrier, would get resolved with major efficiency. The most effective solution to
this particular issue include identification of issues, which could cause conflicts and also
consideration of the cultural differences that initiate the misunderstandings. In the Chinese
market, the distributor tried to illegally customize kiwi fruit, however was caught and put into
the jail with a compensation of 1 million dollars.
If he had known the rules and regulations of Chinese market, such issues would not
have occurred. Furthermore, the respective distributor or agent would have answered to the
local management of Zespri, however no such regional management people were present in
the market, who would take up the core responsibility of making others understand about
cross cultural differences and issues (Morgeson, Brannick & Levine, 2019). The difficulties
in making the agent understand with correct process and then seeking assistance whenever
needed was vital in the process.
ii) Solution to Lack of Management: The second distinctive issue that was being
faced by the organization of Zespri International was lack of management. One of the most
vital issues that is extremely common in an internationally recognized organization. Due to
the lack of proper leadership and management, the respective employees or staff were unable
to share their problems and shortcomings in the business. It even ensured that the entire
business of Zespri International is getting down with selection of inappropriate employees for
the poor strategies and procedures. Zespri International should have involved a management
or leader in the Chinese market, who could have identified each and every feature of the
market and what should be done for bringing better efficiency in the business and also
increasing profit.
However, since no such management or leader was present in the market for
supervising the distributors, these distributors did not get any complete idea about what steps

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should be taken and how to maintain compliance in the business (Sparrow & Makram, 2015).
Moreover, the policies and procedures were also not evaluated for human resource
management. The management style was not adjusted for checking whether it was working
efficiently and they did not get clear idea about the objectives and goals of the company. It
was highly recommended for Zespri International to include new management to each and
every new market, so that these leaders or managers are able to understand the current
scenario of the market and maintain a progress update on the organization. It would even
bring out a positive working environment and the business expectations would be met.
iii) Solution to Lack of Proper Training and Development: To resolve this particular
issue of lack of proper training and development, it is recommended to the organization of
Zespri International to involve a professional trainer, who could provide training to the
employees with the help of appropriate training programs. Apart from the business benefits,
there would be an increased job satisfaction and high employee motivation. Moreover, they
would be able to identify their own faults and maintain ethical steps. They would not get
indulged in ethical issues like gender inequality, child labour, bribery or corruption. The
training and development programs would also enhance Head Office support functions in
Zespri.
This particular organization should even ensure that the distributors or agents,
involved for their global business, are well trained and they do not get involved in any kind of
unethical or illegal acts, such as not paying custom duties or illegal customizing (Kavanagh
& Johnson, 2017). It would save up the goodwill and brand name of the organization and as a
result, total profit of the organization would be highly enhanced without much complexity.
Zespri even will be able to settle with their employees through proper involvement of HR
department and they will be able to diminish the issues in the most effective and appropriate
manner.

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3. Conclusion
Therefore, conclusion could be drawn that the most important and significant
functionalities of international human resource management mainly include recruitment and
hiring, compensating, developing as well as following the basic laws. Due to the incremented
globalization, this international human resource management plays one of the most
significant roles for achievement of each and every objective of the organization. Since,
business growth and development hugely impacts the entire human resource department, it
becomes quite common for them to ensure that a wide variety of activities are being obtained
without any kind of issue or complexity. The entire HR department has to conduct few of the
activities for bringing changes in the organization. Few of the most important and significant
issues faced by IHRM for doing business in a global world, include cross cultural issues, lack
of training and development for employees, remuneration packages and many more. The
above provided report has clearly outlined a detailed analysis of the case study of Zespri
International after identification of few HR problems and then providing suitable solutions to
those issues.
4. Recommendation
The most suitable recommendation to the organisation of Zespri International would
involvement of a manager or management in each and every market such as Brazil and
China. The inclusion of management in the markets would eventually ensure that all the
problems are getting resolved and the monitoring of progress of work is possible. It would
hence increment the productivity of the business and there would be an adherence to the
quality standards. Furthermore, an increased efficiency in the processes is responsible for
bringing project success and hence improving organizational turnover as well as potential
market shares. This particular recommendation would even reduce the employee turnover and
also improving the business’s goodwill and brand name. Zespri International would be hence

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able to reduce the issues of human resource management and every other aspect of illegal
customs of kiwi fruit.

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