To get a job, a promotion, or a new position in an organization, social networks can be decisive. Whereas in developed countries such as the United States or Canada, “weak” social ties—acquaintances with whom one has sporadic contact—are key to getting a job, in emerging countries in Asia or Latin America, “strong” ties are more useful— kinship or close friendship—when getting promoted and prospering on the job market. Knowing how social networks function as related to Latin American job market dynamics can help human resources in the region perform better, and can serve as a guide to manage them efficiently.
The chapter “Human Resource Management in a Kinship Society: The Case of Latin America,” included in the Handbook of Human Resource Management in Emerging Markets. and co-written with IESE professor Marta Elvira, examines how social networks affect human resource practices in Latin American organizations. By analyzing the region´s cultural values, and focusing particularly on hiring, promotions, training, and labor relations, we explore how, in Latin America, social networks influence the job market.
Prevalence of Kinship Networks
Kinship societies, such as in Latin American countries, tend to favor the development of networks with “strong” ties, for economic and business reasons. Social networks within and outside of organizations then facilitate an administrative function (of governments and businesses) that does not manage to meet the needs of employees.
Thus, social networks produce a “social capital” that has its own value (and that generates more trust than the institutions), because it is based on reciprocity and the constant exchange of favors. An example would be compadrazgo, which also exists in the Chilean middle class and the Brazilian jeitinho. Culturally, the region has developed mainly from a kinship structure and not through market principles.
“Vertical” and “Horizontal” Ties
Latin America’s economic development is strongly related to a pattern of cultural values whose cornerstones are the family, authority, and power. Historically, family businesses have been the main driving force behind development in the region, and relationships among family members have been of vital importance, but so have relationships among elite families and the members of the same socioeconomic group. As a consequence, the “weakest” ties with friends, acquaintances, or colleagues are secondary to these networks, the opposite of what happens in countries such as the United States or Canada.
On the one hand, in the paternalist system that has prevailed in the region’s labor relations, bosses take care of their employees’ personal needs and those of their families. On the other hand, there is a lot of respect for authority and hierarchal structures, which may favor close ties between the members of the same socioeconomic group.
One of the findings of this research shows that, in Latin American organizations, superiors and subordinates develop strong “vertical” ties because they share the value of power distance based on solidarity and reciprocity; whereas it is more likely for “horizontal” ties to develop among people from the same hierarchal level because they share the value of legitimate authority and social differentiation.
Networks and HR in Latin America
“Strong” ties—which privilege kinships and close friendships from the same socioeconomic group—may be the most effective way of finding a job. It is also believed that hiring relatives or family members of employees increases trust, loyalty, and responsibility in the workplace, and recommendations from family members, close friends, or classmates are the main source of hiring in many companies.
Recruitment and personnel selection practices based on the family or the socioeconomic nucleus through “strong” ties guarantee employee control and performance; however, they can also be a glass ceiling for executive promotion, as they are more important than talent.
With respect to training, we found a predominance of the master-apprentice model, by which the relationship between superior and subordinate is strengthened based on the principle of vertical reciprocity. Informal training is also useful, as vacant positions are usually filled from the inside, although it could create opposing viewpoints at the management level when managers get training and apply professional administrative practices.
The chapter describes how labor relations have historically been carried out in Latin America: Strong ties between unions and political groups have guaranteed control over the workers in exchange for privileges, which shows another strong vertical tie between these social agents.
