Year of the Tiger – HR Shift

In Chinese zodiac, the year of the Tiger is traditionally associated with massive changes. To remain ahead of the game, here are a few ways that companies in Mainland China should consider:

1. Make a call for HR contribution to the organization’s productivity and capabilities. For most management teams, putting more emphasis on HR means realizing tangible and monetary deliverables. Reduction of recruitment costs seems to be the next and most relevant frontier. Building strong in-house recruitment arm with their own high caliber headhunters is financially sound, especially as recruitment fees to external recruiters have skyrocketed as talent is scare in China. However, this strategy does not solve the long term issue of developing talent and making it more effective. Net net, retention could be much cheaper than recruitment.

2. Shift focus on building talent. Long-term workforce planning involves identifying and nurturing junior talent particularly fresh out of college. The ‘big four’ and even some local Chinese companies realize the importance of an aggressive approach and surpass other people businesses in this respect. Each year in November these organizations put the senior students to a series of interviews and tests. Once this process concludes, employment contracts are signed and the "workforce newbies" are expected to start after their graduation in May of the following year.

3. Fill in your teamwork approach with substance. Pulling together as a team is a central element of motivational speeches by many companies’ leaders. However, bonuses tend to be based on individual performance and enormous discrepancies in pay tend to prevail. Both of them prevent employees from believing that everybody is "in the same boat". For all employees to feel valuable and more valued, status, pay, perks, and other privileges should be reviewed and according to Jeffrey Pfeiffer (1998, The human equation: building profits by putting people first) reduced. As an example, Whole Foods Market introduced a policy limiting executive compensation to ten times the average full-time salary of all team members; disruptive?

Culturally speaking, the concept of teamwork must also be reviewed critically in Mainland China. Surprisingly, current experimental research suggests that Chinese tend to avoid team-based performance measures and self-sacrifices in favor of the team. This goes to show that collectivism of Chinese culture does not automatically translate into cooperation and teamwork in the workplace.

4. Decentralize decision-making. The words “empowerment” and “to empower” are often misused. For example, companies believe that by having a suggestion box, employees will feel more empowered to put their ideas forward. Leaders also tend to believe that making the company’s proprietary tools available to employees and offering training so that employees can do their daily work constitutes empowerment. Well, empowerment is first and foremost about enabling non-managerial staff to make autonomous decisions without consulting their supervisor.

The best examples for empowering staff arise from the hospitality industry. Hampton Inn Hotel instituted a 100 percent satisfaction guarantee and thereby permitted employees to do whatever was required to make their guests happy (for example, giving money back for the cost of one night’s stay at the hotel should guests find shortcomings in service). At the Ritz-Carlton Hotel, employees have the discretion to spend up to US$ 2,500 without any approval in order to respond to guest complaints. (Pfeiffer, 1998)

For those in "people" businesses in China, the question is what the scope of the decisions is and whether or not employees have the skills and knowledge to make those decisions.