Human Resources Management Strategies of Taiwan-based Enterprises in Vietnam

2.2 HRM Issues of Taiwan-based Enterprises in Vietnam
After implementing reform policy in 1986, it is attracted the number of FDI into 
Vietnam in which Taiwan is one of largest investor of Vietnam up to now. However, 
the HRM of Taiwan-based companies are still facing with difficult in term of cross-
cultural management which communication barrier within organization may lead to 

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misunderstand and produce on reducing job performance of employees. Plus, the 
human capital matters regarding of recruiting workforce as well as work efficiency of 
Vietnamese labors in Vietnam also one of major reasons challenges Taiwanese 
companies in HRM field. 
2.2.1 Cross-cultural Management 
Cross-cultural management is defined as the behavior of people in organizations 
and performs how to work with employees and their customers from many different 
cultures. It describes organizational behavior within countries and cultures as well as 
compares organizational behavior cross countries and cultures, from that on, seeks to 
understand and improve the interaction of managers, co-worker, and alliance partners 
from different countries and cultures, (Adler, 2002). Communication is a major barrier 
in multicultural workplace in which language is considered as a key factor in cross-
cultural communication (Thomas and Peterson, 2015). It is a tool to transmit 
information from one person to another. This may make difficult for someone who 
isn’t
fluent in the language in which business is conducted. The sender may take longer to 
communicate their ideas to receiver and the receiver may also be unable to get the 
message correctly if the language skills of the sender are not good enough. 
In case of the Taiwan-based enterprises in Vietnam, communication is a big 
obstacle within workplace. The common language of Vietnamese and Taiwanese is 
completely different that is Vietnamese and Chinese so that English is used as second 

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language for both parties. Even though company hires translators for communication 
supporting to Taiwanese and Vietnamese, there are unavoidable misunderstanding 
because of cross-cultural. As (Harzing and Feely, 2008) noted that language barrier is a 
problem in multination business and it effects to company operation. Therefore, the 
language barrier is a major element in cross-cultural communicating that Taiwanese 
enterprises should be considered and that may also help for their HR management as 
well.
Another factor related to cross-cultural communication that is communication 
style which means the style of speaker expresses to listener such as direct and indirect 
communication. 
Direct and indirect communication is associated with that country’s 
culture; directness is related to individual culture and indirectness to collectivist culture 
(Thomas, & Peterson, 2015, p.118). As mentioned above, Vietnam is collectivist 
society which means people expressed in the indirect style in which they might not say 
to-the-point, but they use a hint speech as a way of expressing their ideas. Thus, in this 
communication style may lead to confuse and misunderstand to listener. In any case, to 
have an effective cross-cultural management, the manager must identify and understand 
the differences in cultures as well as need to be able to modify and adapt to the culture 
of country in which company is operating business.