Doing Business in China - Managing human resources

Sub navigation - 1st level

Sub navigation - 2nd level: Setting up in China; Choosing the right location; Finding premises; Day to day communications; Managing logistics; Managing human resources

Finance and legal issues

Sub navigation - 2nd level: Protecting your intellectual property; Taxes; Banking and getting paid; Getting legal advice and resolving disputes; Corruption and corporate social responsibility; Accounting and auditing requirements; Due diligence and avoiding scams

Communication challenges

Sub navigation - 2nd level: Building relationships; Managing meetings and negotiations; Dealing with government and authorities

Coping with culture and language

Sub navigation - 2nd level: China's culture and protocols; Dealing with language differences; Business etiquette

Manufacturing challenges

Sub navigation - 2nd level: Options for manufacturing; The challenges of manufacturing in China; Finding a manufacturer and location

Sales and marketing challenges

Sub navigation - 2nd level: Getting your products into China; Finding and managing agents and distributors; Direct exports; Marketing

Home › Challenges in China › Operational challenges ›

Managing human resources

You will probably have to spend more time on human resource (HR) issues in China than in other markets. A survey of US Business Council members found recruitment and retention were their top operational issues in China.

One of the major drawcards for Western companies in China - relatively low wages - is disappearing within some job categories in some regions and industries. This is particularly the case for well qualified technical and management staff in the main cities. In Shanghai professional salaries can match what you'd have to pay in large Western markets. Skill shortages are also a major problem with many companies listing this as the biggest brake on their growth in China.

Another issue is looking after your New Zealand staff who have relocated to China (or expatriates already in China).

Key learnings

Watch out for contradictory advice on HR issues - you need to find out what is right for your company.
Check the CVs and references carefully.
Make the final selection yourself.
Look after your expats.
Value your Chinese employees.
Look out for hidden wage costs.
Invest in vocational training and head or regional office placements.
Conduct exit interviews.
If you "inherit" staff via an acquisition or joint venture don't be too quick to pick and choose who you will keep or let go. Some labour laws prohibit layoffs in certain circumstances, but you don't know in the short term who actually plays which key roles, or more importantly in China, who is related to whom.

Where to from here?

What do you want to know?

Related Information:

› How to hire staff
› Remuneration of staff
› Training executive and vocational staff

Related Kiwi Lessons:

› Don't think hiring is only about money
› Use Chinese nationals familiar with New Zealand
› Hire a mixture of local and expat staff
› Offer staff regular visits home

Doing Business in China - Making the most of the free trade agreement

Managing human resources

Key learnings

Where to from here?