INTERNATIONAL MANAGEMENT

International Management - DB Schenker Rail Joint Venture in the Arab Emirates with ETIHAD

International Management - DB Schenker Rail Joint Venture in the Arab Emirates with ETIHAD

Introduction

DB Schenker Rails is a multinational organisation which currently has more than 88,000 people working for them in almost 2000 locations within 130 countries globally. Their annual turnover is estimated at 18 billion Euros and is considered a leading logistics company. Its parent company is Deutsche Bahn the logistics powerhouse based in Germany, and is headquartered in Duisburg (DB Schenker Rail, 2010). It retains about 300,000 employees worldwide, and is a top ranking company in the Global Fortune 500 list. Within the UK, DBSchenker Rail is the largest freight haulier, holding a leading market position. This report is set to analyse and process the challenges that they will face in respect of IHRM, with regards to their opportunity to set up a new rail infrastructure and business in the Arab Emirates in collaboration with a localised JV partner which will be Etihad.

DB Schenker Rail moves a large load, almost 80 million tonnes per year. Their aim should be to maintain its position in the global market. To do this, the company should be prepared to penetrate all sectors of the fast growing Arab Emirates logistics transport. Using their local partnership with ETIHAD, which will concentrate on the development of rail freight, they should move towards the UAE and with a particular focus on the transport of goods in bulk, trains, carriages and combined transport, which should aim to provide efficient transport services (DB Schenker Rail, 2010, p 77). However, the purpose of this paper is to highlight the cultural and social problems that may arise during this joint venture, and how DB Schenker Rails's IHRM department should plan to deal with their employees going through symptoms of “culture shock” while working in the Arab Emirates.

Problem Statement

To give an idea about the size of the problem we note first that a company like DB Schenker Rail operates in UAE, and all of these offices must fill personnel from Germany and Arab Emirates. The Human Resources management is responsible for the selection, training and reward process of the employees in any organisation, In this paper, we are going to look upon the issue of international human resource management DB Schenker Rail.

First of all, from the four stages of culture shock, we must understand that the differences are either euphoric or an unusual mix of culture and setting properties of recovery mechanisms - fear, homesickness and depression experiences and progressive adaptation or the adoption of biculturalism which could lead to a crisis, (Padilla, 1980, p 102-105). Cultural adaptation and orientation (Sculion et al, 2006, pp. 18-23) could train the expatriate manager. Cross-cultural preparation should be a priority in the preparation of the expatriate (Lancaster et al, 2002, p. 233).

Definition of Culture

Management of expatriates plays a small but crucial role in the management of IHRM. IHRM managers need to form a strategy which reflects the ...