Strategy to Build a World-Class Pdc for Hi Tech Systems

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However, they cannot rely on recruitment through guanxi. Hiring through personal connections is likely to bring unqualified workers. Joint ventures may also run the risks if the partner is unable to provide personnel with the desired skills and qualifications(Zhou, 2006, p.32.). The advantages and disadvantages should be balanced.

In addition to the recruitment and selection process, policy regarding the retention incentives Peter Hanson adopted is far from having been locally adapted.

In China, the job hopping has become so common, especially among the highly-educated youngsters, who have relatively strong individual bargaining power. While the product creation work the PDC undertakes means the major employees should be the highly-educated who are in great shortage. So efforts should be taken to retain these talented employees.

Firstly, Peter Hanson should provide satisfactory financial reward. Research studies revealed financial reward is one of the most important factors in retention and motivation in China(Cooke, 2014, p.15.). In addition, developing opportunities, training programs, mentoring and a positive working environment can be crucial.

However, putting too much attention only on the reward to retain the talent rather than developing them can be short-term oriented, not conducive to human capital development for both the individuals and the firm in the long run.(Cooke, 2014, p.16.) Companies such as Unilever, HSBC, and Maersk have developed their graduate training scheme as part of their long term talent management strategy to attract and foster high-calibre talents who lack work experience. (Zhou, 2006, p.35.)

Therefore, with limited fund, Peter Hanson should consider training and developing programs as incentives, this also matches up China’s situation.the Chinese government is taking policy to combat the problem of skill shortage and raise the skills level of the workforce to enhance national competitiveness, so the institutional environment can be favorable. (Cooke, 2014, p.5.)

With regard to the consideration of Peter Hanson that to what extent the Chinese employees should receive the same content as Hi Tech System’s employees elsewhere, one factor relative is the fear of staff turnover. In this case, a detailed labor contract that set restraints on employees’ quitting who have taken a high-cost skill training can be formulated. This will not scare off the potential candidates if offering good salary in the same time. In addition, job training opportunities in China market are limited, which make the job with training program Hi Tech Systems offers more attractive.

To conclude, a good financial reward and training opportunity should be combined and both emphasized, to increase the attractiveness , retain the talents and lead to long term development.

From Peter Hanson’s strategy, they need employees expatriated from different other PDCs so as to better the connection with other PDCs. But failure from a expatriation can result in great loss and cost. So there are several significant points for Peter Hanson to pay attention considering the expatriate matters.

Generally, incentives are necessary for Peter Hanson to recruit and retain expatriate employees. Firstly, providing sufficient pre-departure training so that they can be well prepared and adapt to the local environment quickly. Secondly, a satisfactory salary is always attractive. Thirdly, collaborating with other PDCs to guarantee a job upon return and do not counsel repatriates when they come home.

Anyway, it’s an advantage for Peter Hanson to build the PDC in china. The local employees may not get depressed when compensations for expatriate employee are higher. Fairness is defined differently by people of different cultures. In collective societies, harmony may precedence over pay equity. (Toh, 2005, p.8.)So local staff in China would have been unlikely to view themselves as comparable to expatriates because of the vast differences in backgrounds, qualifications, and experience. One study even found that Chinese managers felt fairly treated by their organization because they are better off compared to other locals in the same company or in other international joint ventures(Toh, 2005, p.7.).It’s even better that Peter Hanson tried to coach the expatriates not to mention how much money they made, how they lived, and how cheap they found most things to be in Shanghai. This will maintain the harmony between his staffs with different salary.

In summary, the transnational HR practice Peter Hanson has adopted indicate a good local adaptation to China despite of the several points need to be rethought to smooth the process of the new PDC building. All the points recommended are linked to a better local adaptation with regard to the recruitment and selection process, the retention policy and the expatriate policy.The recruitment methods like the assessment should be improved and locally adapted because of the different thinking pattern of Chinese and Western people. Chinese’ guanxi should also be considered and balanced in the process. To deal with the fierce competition in China’s talents market, competitive financial rewards and training program should be implemented. Finally, formulating a relatively higher expatriates compensation policy is feasible and acceptable in China. There will still be a long way to go for the new starter and changes should be made with the fierce change of market and society.

Reference:

Borkman, I. and Lu, Y. (1999), A Corporate Perspective on the Management of Human

Resource in China,Journal of World Business, 34 (1):16-25.

Cooke, F. L. (2014). HRM in China. In Varma A. & Budhwar, P. S., Managing HR in

Asia-Pacific, 2nd ed., pp. 11-30. New York: Routledge.

Toh, S. M. & DeNisi, A. S. (2005). A local perspective to expatriate success. Academy of

Management Executive, 19(1), pp. 132-46.

Zhou, G.Z. (2006). An Examination of HR Strategic Recruitment and Selection Approaches

in China.