Talent Management in Latin America

Pressing Issues and Best Practices

Jordi Trullen, Jaime Bonache

• Publisher: Routledge
• Year: 2021
• Print ISBN:
  9780367819903
• eBook ISBN:
  9781000416534
• Topic: Business
• Subtopic: Business General
• Index: Business

In a period of about 20 years, Latin America (LATAM) moved from having highly unstable closed economies ruled by authoritarian regimes, to becoming more democratic, stable and open to investment and trade, attracting by 2020 close to 11% of world total foreign direct investment. In parallel, the region has seen the emergence of large multinational companies (so called multilatinas), which have become true global players.

There is still relatively little knowledge about how to manage employees in these countries and there is a need for more research addressing people management problems. In comparison with other world regions, Human Resource Management research on Latin America remains scarce. Focusing on this region, this book seeks to offer a more up to date review of the main developments in HRM and talent management that have recently occurred in Latin America, paying attention to local cultural and institutional factors; illustrate examples of idiosyncratic problems or issues that require approaches to TM that differ significantly from those commonly established in current literature; and describe and reflect on the transfer of Talent Management policies from and to LATAM within the context of local and foreign multinational companies.

Talent Management in Latin America updates main HRM topics in Latin America, with a local focus on culture and institutions. It shows the latest state of knowledge on the topic and will be of interest both to researchers, academics, and students in the fields of human resource management, critical management studies, and international business.

1 Introduction

Jaime Bonache and Jordi Trullen

Half a century ago, the Uruguayan writer Eduardo Galeano asserted that “as far as the world is concerned, America is nothing more than the United States: we inhabit, at most, a sub-America, a second-class America with a nebulous identification. It is Latin America, the region of open veins” (Galeano, 1971). If we come to the present time and review the content of international manuals on human resource management, even those manuals most used and influential in Latin America, it is difficult not to agree with the above words by Galeano. In contrast to the huge amount we know about management problems in the US, where there is a wealth of research on the most varied determinants and effects of managing people in various ways, what we usually find in such manuals about the reality of human resources in Latin America is anecdotal and marginal.

We believe that this scarce attention and apparent lack of interest in managing people in Latin America is an error for two reasons—one quantitative and the other qualitative. Regarding the first, much objective data underlines the economic importance of the region: Latin America represents 14% of the world’s land mass and covers some eight million square miles (Nicholls-Nixon, Castilla, Garcia, & Pesquera, 2011); the region has a gross domestic product of $5.7 trillion and a population of more than 650 million (World Bank, 2020a); it attracts 10.7% of world foreign direct investment (UNCTAD, 2020); and accounts for 6.5% of the world economy and 8.4% of the world population, with two countries, Brazil and Mexico, among the world’s 20 largest economies. If only because of the substantial investment made by many companies in Latin America, it does not seem sensible to operate in this region blindly and without evidence that enables businesses to assess what they should—and should not do—in terms of managing people.

But there is another and more qualitative reason to study personnel issues in Latin America. As the Cuban writer Alejo Carpentier (1949, p. 67) wrote at the end of the 1940s: “In Latin America, the wonderful is found around every corner, in the disorder, in the picturesque images of our cities … in our nature … and also in our history.” The first author has traveled extensively in the region, given many training courses, and worked on the ground with companies and organizations that have local economic interests. The second author has traveled to various Latin American countries, as well as taught and collaborated with several Brazilian colleagues. All this has helped us discover the truth of Carpentier’s words. Latin America is indeed an exciting environment. But, it is also an especially complex and unstable region, which makes it a particularly interesting and challenging subject for research. Just over a decade ago, optimism was dominant. It was highlighted how, in a period of some 20 years, Latin America had changed from having highly unstable closed economies ruled by authoritarian rulers, to becoming more democratic (Santiso, 2007). The region has also seen the emergence of major multinational companies (known as multilatinas), which had become global players (AmericaEconomía, 2016). As we write these pages, however, that optimism (as so often in the past) has changed into deep concern about the economic and social situation of the region. Some of the countries mentioned as examples of economic miracles (such as Brazil and Chile) suffer the same socioeconomic difficulties faced by countries in other latitudes, and the populism that is causing so much damage to various societies in the 21st century seems to have found an especially fertile ground in many Latin American nations and governments.

A few examples will enable us to emphasize the qualitative interest of the region. In 2019 (before the start of the pandemic), the following events occurred: the president of Bolivia had to flee from the nation after being accused of electoral fraud; in Chile and Colombia, there were major social revolts driven by student protest against economic reforms; in Costa Rica, there was a prolonged strike in the health and educational sectors; in Ecuador, there were mass demonstrations against a rising fuel prices; in Haiti, there were several riots aimed at overthrowing the president; in Honduras, there were protests about election irregularities; in Paraguay, the government had to restructure after the covert renegotiation of a hydroelectric contract with Brazil was revealed; in Peru, there was an open struggle between the president and congress; while in Nicaragua, there was a violent confrontation between the government and a broad coalition of civil society, the Catholic Church, and the private sector (World Bank, 2020b). All these occurred without counting the continuing explosive situation in Venezuela and the subsequent migrant crisis. Social unrest is now compounded by the COVID-19 pandemic, which included more than 8.3 million cases and more than 310,000 deaths as of September 14, 2020 (BBC, 2020), and which, according to some recent estimates, could impoverish 25 million people in Argentina, Brazil, Mexico, and Colombia alone (El Pais, 30 August 2020). How can we lead people and manage organizations in such a difficult and unstable environment? What can managers do to attract, retain, and motivate people when they are surrounded by anxiety and pain—with populations suffering because of the fall in economic activity, the COVID-19 pandemic, and social instability? What is influencing these managers and what impact do their decisions have on affected stakeholders such as employees and local community? In short, what makes the People Management in the region more efficient and/or legitimate and how are human resource problems experienced?

It is difficult to answer these types of questions supported by quality scientific research. HRM research on Latin America remains scarce and descriptive when compared with other world regions such as Asia. It is true that, in recent years, a number of publications in academic management journals have directly addressed the Latin American context (Aguilera, Ciravegna, Cuervo-Cazurra, & Gonzalez-Perez, 2017; Bianchi, Mingo, & Fernandez, 2018; Hermans et al., 2017; Husted & de Sousa-Filho, 2019; Mingo, Junkunc, & Morales, 2018). Nevertheless, these works do not usually specifically address human resources. There is a need for more literature that addresses in a rigorous manner the talent management problems experienced in Latin America.

However, we do not want to exaggerate either. To say that there are few rigorous studies on people management in Latin America does not mean that there are none. If the reader chooses to search the databases for a reliable source on the subject, he or she will be pleased to find their effort rewarded. Works on the subject written almost 15 years ago by Elvira and Davila (2005) and Davila and Elvira (2009) stand out. These works offer an excellent conceptual framework for analyzing the implications that certain dominant regional work values (such as benevolent paternalism, personal contact, and popular traditions) have on the design, implementation, and results of specific human resource policies in Latin America. These works also indicate the need to have a good knowledge of the Latin American sociocultural environment, and not to uncritically apply frameworks and solutions from other countries (and especially, the Anglo-Saxon world).

This rejection of the simple importation into Latin America of “prefabricated” models of progress has been discussed by other authors, including the writer Carlos Fuentes, who with great subtlety and depth, has written memorable pages analyzing the sociocultural context of the region. For this Mexican author, there is a long Latin American tradition of venerating ideas from Europe and the US that have not always translated into substantial improvements for the continent. Culturally, independent Spanish America turned its back on its black and indigenous heritage in the 19th century and understood it as “barbaric.” Subsequently, there was a rejection of everything Spanish, combined with great admiration for the US, and especially for France, as the world’s cradles of progress. It was the time of Auguste Comte’s positivist philosophy, according to which “human history developed in predictable and universally valid stages” (Fuentes, 1998, p. 425). A typical assumption was that the new Latin American nations could also become modern nations if they closely followed certain steps based on French and American experiences. This uncritical and xenocentric vision ended with negative consequences. While the elites imitated “French” and “American” tastes in areas such as consumption, clothing, architecture, political, social, and economic ideas, they were unable to apply the working models of these countries (which were perceived as straitjackets that were poorly adapted to Latin American cultural idiosyncrasies). Latin America thus became a source of raw material exports, but without generating for itself the necessary capital for investment and savings.

Analyzing the extent to which initiatives from “outside” the Latin American environment also work in this context is a key issue for empirical research. In fact, this is what we did in our own work when testing the typical universalist and culturalist visions in human resource management (Bonache, Trullen, & Sanchez, 2012). However, the way in which we addressed this subject (i.e. our methodological approach) was the typical and dominant approach used in intercultural management—but it is not the only possible approach. Let us clarify this point a little further to see what new research opportunities exist in this field, as well as what this book intends to contribute.

Providing a vision around the management challenges within a given region can ideally be done from two epistemological perspectives: positivist or interpretative (Szkudlarek, Romani, Caprar, & Osland, 2020; Bonache, 2020). The first approach is the most common and is adopted by Davila and Elvira, and is also the perspective we followed in our own work mentioned earlier. Based on the assumption that there is a social world independent of the researcher (in this case, the Latin American sociocultural world with its own management practices), this approach identifies regularities between variables of interest (such as relations between certain cultural values, HR practices, and behavioral outcomes) as well as “boundary conditions” that specify in which situations such regularities are most likely to occur (Donaldson, 2003; Sackman, 2020). This perspective differs from the constructivist or interpretivist perspective that focuses on understanding social phenomena from the point of view (or interpretation) of the various groups involved (Gertsen & Zølner, 2020). Although constructivist studies are increasingly influential and common in the field of intercultural management (Szkudlarek et al., 2020), it is unfortunately difficult to find studies on HR in Latin America from that perspective (indeed, we have not managed to find any). Such studies, by putting to rest the assumptions we normally hold about a given area and studying reality from a local point of view, would enable us to reveal specific (and possibly new and different) ways of looking at events in Latin America. Such studies may help generate more socially relevant research, and it would be extremely rewarding if any of the readers of this introduction take up the challenge of conducting that type of work.

When Professor Ibraiz Tarique, the editor of this collection, commissioned this book from us, our first idea was to prepare a manual about the reality of human resources in Latin America from the two perspectives mentioned earlier. However, the lack of constructivist studies led us to dismiss that idea. What then could we do? We decided to explore two other options. One of these was deductive: starting from a general index of topics to be covered and inviting various authors to write the chapters. A book organized in this way would undoubtedly be excellent. However, given the lack of data on most of the potential topics, it would run the serious risk of importing data and conceptual frameworks from other environments—and thus, the text would be constructed on very weak empirical pillars. We were thus left with a more inductive option. This consisted in carefully reviewing the recent scientific production on human resources in Latin America and identifying the issues and authors. This path would enable us to discover, without a priori frameworks or preconceived ideas, the topics and factors that are especially relevant to the Latin American scientific community. This is how the book came to be written. It includes chapters focused on factors or variables found in the general Latin American context: such as populism and unproductive behavior (Wated & Sanchez; Chapter 2); or informality and deregulation of the labor market (Amorim, Neto, and Garcia, Chapter 3). Other chapters analyze how specific human resource problems are approached in a Latin American context: such as the attraction of local talent (Ramirez and Søderberg, Chapter 4); or career management in family firms (Vazquez, Gómez Mejía and Molina; Chapter 5). Finally, there are two chapters analyzing how well-known human resources initiatives in other latitudes are understood and implemented in Latin America: such as socially responsible HRM (Davila, Chapter 6) or high-performance work systems (Hermans and Díaz Avendaño, Chapter 7). A simple glance at the list of chapters reveals that the book does not cover all the potentially important topics, but that all the topics included are important.

We will conclude by saying something about the work process that has made this book possible. After deciding the direction we wanted to take with the book, and carefully reviewing what has been published in the area over the past few years, we made a list of the ideal authors. Some of the authors were good friends, but others we had never met. We were pleased that everyone we invited to join the project chose to accept. From then on, the only priority was to collaborate with each other so as not to disappoint the publisher, authors, and potential readers. In this context, we recall what one of the few writers who worked in collaboration, the Argentinean Jorge Luis Borges, wrote about the success of his writings with his compatriot Bioy Casares:

I have be...

Table of contents

• Cover
• Half Title
• Series
• Title
• Copyright
• Dedication
• Contents
• List of Contributors
• 1 Introduction
• 2 Political Populism-to-Work Spillover in Latin America: Implications for Human Resources Management
• 3 The Emergence of the Self-Employed Worker in Brazil: Toward a Structural Change of the Labor Market
• 4 Talent Management in the Interface Between Cultural Heritage and Modernity: A Case Study of Younger Mexican Middle Managers in a Regional Office
• 5 Job, Career, and Calling of the Next Generation of the Family Firm: A Latin American Perspective
• 6 How Socially Responsible HRM Should Be Understood in Latin America
• 7 A Stakeholder Approach to Strategic Human Resource Management in Latin America
• Index