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HR Management Trends in a Globalised World

Volume 2, 2019

By Joan Zhou

The origins of HR management

A company’s HR practices starts from its brand positioning. Although often overlooked, this relationship has a decisive impact on the rise and fall of businesses; the way a company positions itself determines its philosophy, including its organizational principles and structure.

However, the positioning of a company is not set in stone. When Chinese companies go global or foreign firms enter China, they must clearly define their long-term positioning, while constantly making adjustments to match real life. By the same token, their HR practices must also evolve to ensure that they are keeping up with the times.

In today's increasingly globalised world of business, the evolution of companies can typically be divided into three stages. During the first stage, companies focus on R&D and product development; one example of such a company would be the EV manufacturer Tesla. During the second stage, companies strive to use their presence in different market segments to achieve economies of scale; the tech giant Apple falls within this bracket. During the third stage, companies diversify their business by integrating resources across a range of industries; the Alibaba Group is a case in point. The transition from one stage to the next is not a step-by-step progression, and there are no clear-cut boundaries. To become an industry leader, companies must focus on one or more of these stages, depending on their own positioning, and develop an appropriate talent management model.

Social recruiting: A new approach to hiring

In the West, companies often use local head-hunters to recruit talent across regions. However, the traditional head-hunting model is lagging behind due to increasing cross-sector collaboration and a growing demand for talent. Social recruiting has recently emerged as a new method for identifying talent, and it is now being used both intentionally and unintentionally by many businesses outside China. Social recruiting takes the forms of cross-departmental and cross-industry workshops, corporate cocktailing events, industry forums, etc. to create a hub of information and idea exchange. For example, CEIBS, where I am now doing an EMBA, provides quality networking opportunities for Chinese and overseas entrepreneurs across the supply chain.

The devil is in the details

Proper talent management is essential for a company to develop a market presence. One of the challenges for Chinese companies venturing abroad is finding a way to retain and optimize their human resources. If they try to replicate a tried-and-true HR model from overseas, it's important that this is followed to the letter. In the past, several Chinese businesses have overlooked important aspects of the models they base themselves on, often resulting in failure. Meanwhile, HR practices need to take into account cross-regional culture maps, with communication and management based on respect for others.

A recent McKinsey survey pointed to new trends in corporate HR management that are set to change the way businesses operate. For example, a high employee turnover rate — which affects some industries and professions more than others — is now becoming the norm. Entrepreneurs need to keep abreast of these changes and adapt their HR management model accordingly. For example, they need to retain top performers rather than try to reduce the overall turnover rate, which is now being used as a yardstick for HR assessment in some foreign companies. This gives a more granular reading on the value of corporate HR.

Entrepreneurs are often too idealistic about the type of talent they are seeking. In an ever-changing market, they cannot afford to be short-sighted or complacent, but must instead remain up-to-speed with the latest HR trends and best practices. Thankfully, the CEIBS platform can help overcome this: by interacting with the school’s professors and their classmates, entrepreneurs not only expand their social networks, but are able to access well-grounded, forward-looking business insights that will provide them with a new perspective on effective HR practices that can be a catalyst for corporate growth and innovation.

In his writings, Chinese philosopher Mencius stresses the importance of people by saying, “the weather is not as good as the land, and the land is not as good as the people”. And in his Art of War military strategist Sun Bin (said to be related to Sun Tzu) writes: “If the times, geographical location and people are not allowed to win, there will be disaster even in victory.” It is my hope that, going forward, Chinese enterprises will have a solid understanding of the importance of employees, and leverage HR management trends in today’s globalized world to go from strength to strength.

Joan Zhou has practiced and conducted research on corporate structure and HR management during roles at Shanghai Corporate Development Research Centre, Huawei, and Walmart. She is currently China HR director of an international fashion brand and a CEIBS EMBA 2017 student.