Human resource management as competitive advantage in the new millennium

Abstract

One strand of conventional wisdom is the urgent need for human resource management in Indonesia to improve to world standards so that the Indonesian corporate sector can survive in a globalized economy. Another strand accepts the need to improve to international standards but argues that such improvements should be based on Indonesian conditions. Indonesian management is traditional, patrimonial and hierarchically oriented, and international practices like empowerment, participation and incentive orientation are irrelevant or, at best, need to be adjusted to and are secondary to Indonesian indigenous characteristics. There is a dearth of empirical research in Indonesia that could support either strand. This article presents three mini‐cases to argue that human resource management in Indonesia is a complex process with both national and international influences. The cases suggest national conditions need not hinder the adoption of international best HRM practices focusing on participation, empowerment and incentives leading to competitive behavior.

Future research on human resource management systems in Asia

“…The literature analysis on HRM in Asia in particular shows that research has been and is being conducted on the following topics. First, the literature regularly features a number of country-specific studies, such as those on Japan (Sano, Morishima, & Seike, 1997), Singapore (Chew & Horwitz, 2004), Hong Kong (Kamoche, 2003;, Thailand (Kamoche, 2000;Siengthai & Bechter, 2005), Vietnam (Kamoche, 2001), Malaysia (Chew, 2005), Taiwan (Lin, 1997), Indonesia (Habir & Larasati, 1999) and Korea (Rowley, 1998). At present, a lot of research is being published on different aspects of Chinese management (Chow, 2004;Cooke, 2005;Mathews, 2006;Peng, 2007;Warner, Wong, & Lee, 2002).…”

eHRM adoption in emerging economies: The case of subsidiaries of multinational corporations in Indonesia

“…Regarding other external factors, we observed that in terms of the perception of the HRM function, little has changed since Habir and Larasati's (1999) findings that HRM in Indonesia has historically not had an important role in management. It has traditionally been regarded as a supportive function and almost totally administrative in orientation.…”

“…While HRM did not enjoy a particularly positive image in Indonesia before the Asian financial crisis (Bennington & Habir, 2003), the recognition of HR roles in companies is steadily rising (Habir & Rajendran, 2007). Traditionally, HR roles in Indonesian companies have been considered administrative in nature (Habir & Larasati, 1999), and the educational background of HR managers has not been HR-related in most companies (Bennington & Habir, 2003). However, since 1997, personnel departments and managers have mostly been rebranded as HR departments, and managers are keen to stress the newly gained importance of HRM (Habir & Rajendran, 2007).…”

Cultural dimension issues in Indonesia human resource management practices: a structured literature review

“…Indonesia was chosen as the representative based on some considerations including the size of its population and economy. Since the Asian Economic Crisis of 1997, Indonesia is continuing to rebuild its economy and successfully overcome the crisis by adopting new strategies and making significant changes to human resource management (HRM) policy and practices (Habir and Larasati, 1999). Indonesian is an emerging market and managing Indonesian people is not easy because of the complex cultural, geographical, historical, ethnic, religious, economic, political and administrative systems (Singleton and Nankervis, 2007).…”