hr practices in china

H R practices in

Sneha Mittal

HRM: a strategic function concerned with consequences of all organizational decisions for human productivity and for the well-being of the entire work force.

It is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable work force, using an integrated array of cultural, structural and personnel techniques.

HRM practices in China:

 • Concepts of Chinese culture affecting HRM

practices in China• the respect for age and authority• maintenance of harmonious human relations• the favour of personal relations • group orientation• the concept of face, which suggests that one

should avoid losing face - shame and indignity in public.

Areas of HRM: • Recruitment• Training• Performance appraisal• promotion criteria• financial reward

Recruitment 

• Inheriting the existing workforce of local parent partner

• Quick to start the local partner provide welfare and supporting facility old organizational culture.

• Merits and defects of recruiting from labour market selecting the best candidates creating new organizational culture and management style lack loyalty and high turnover rate difficult to persuade local partner to accept this practice.

Training: 

• Generally most joint ventures in China recognize the importance of training and devote a large amount of resources to training

• Overseas training regarded not only as knowledge acquisition, but also as part of the strategy to retain good employees

Performance appraisal

• Performance appraisal Share similarities to that of home HRM practices than to those of local firms

• Use of objective appraisal criteria; qualitative criteria are used as complimentary

• Top-down appraisal system; unlike the practice in local firms, managers are not rated by subordinates

Promotion

• Promotion Most similar to home HRM practices• the GM has important power to determine the

appointment of middle managers and other subordinates, while in local firms

• promotion typically involves collective actors promotion as a strategy to prepare for greater localization

• usual conflict between foreign and local partners over promotion

Financial rewards

• Financial rewards Joint ventures often offer much higher pay than local firms

• the difference of pay for worker and manager is larger in joint ventures

• pay and bonus are geared to individual contribution

Why localize?

• High cost of maintaining expatriates

• greater long-term effectiveness of local managers

• Need to attract and retain high potential employees

• Best use of human resource assets available locally

Challenges for localization in China

• Few qualified people • Selecting appropriate personnel • Need for accelerated training • Managing the expectations of local

employees• Managing internal politics and resentments• Ensuring the transfer of knowledge and

skills by expatriates • Lack of comprehensive localization strategy

Developing high potential employees

• Developing local leaders in the training classroom

• Coaching and mentoring by someone who understands how to execute business strategies through people

• Trial and error experimentation by local managers

Cont..

• Coaching by expatriates • positioning: to position local managers

properly within the organization, both in China and in the eyes of their western colleagues back at the headquarters

• rotating jobs: moving from various types of functional areas to develop broad base of experience

The roles of expatriates

• To transfer technical and managerial knowledge

• General management: to provide strong leadership, build up organizations, and push for changes

• To communicate with the headquarters

• To safeguard the company’s interests • Hence, a certain amount of

expatriates are needed because some roles are very difficult to be taken up by local managers