DiligenceChina

Flattening Curves: HR Trends in the New China: Stars, Drones & Trainees

What will the China’s HR picture look like in 2016? If the Flattening Learning Curves theory is correct, large MNCs are going to have a big impact on the shape of hiring and compensation for years to come. US-style MNCs have a few standard HR moves that may go over big in China.

The Star System

We’ve also seen movies and shows that revolve around one or two main actors while everyone else runs around supporting their efforts. Well, many US MNCs work on a similar theory. US firms interested in market leadership will always target the most well-known, successful player in the industry and pay him a tremendous premium to join their company. These Stars can expect more than just high pay – they get access to the best resources that the company has. They get the best assistants, analysts, technicians, clients, leads, products and access to top management. Corporate Stars are treated like kings (emperors?) as long as they are performing well. It is not unusual for two salesmen in the same department to earn wildly varying salaries. And US managers are surprisingly open about the situation. “Winners get rewarded” and “no one said life is fair” are the mantras of sales managers and top bosses throughout corporate America, and that system will probably work just great here in China. I can think of more than a few young Chinese sales pros whose sales are barely being recognized. Some smart sales manager or HR pro is going to offer them a 300% bump to switch teams – provided they can deliver on the tremendous promises they will make. Once a Star is born, only another company with the star system will be able to afford them or make money off of them. These people do not play well with others.

Drones

If the front office if for preening Stars, what is going on in the back office? Drones. Dozens, sometimes hundreds of semi-anonymous office workers performing repetitive tasks under close supervision. Compliance, underwriting, funds transfers, and thousands of other functions have to be performed around the clock if those expensive Stars are going to shine. Corporate back offices need lots and lots of warm bodies. Even the automated systems need entry level & middle management technicians to make them operate. These people will be relatively well paid, relatively well treated and will be relatively satisfied. Since these jobs pay more, have better benefits and are very secure, the MNCs will get their pick of the graduating classes at all but the most elite universities and colleges. Corporate HR departments will hire dozens at a time and run orientation training “boot-camps” to train them to fit the companies’ needs. The three big business centers will house these giant paperwork-mills, but will probably draw workers in from all over China. MNC HR departments have learned how to process large numbers of unskilled graduates into productive office workers in the US, and there is nothing about China’s culture or education system that would make it particularly challenging to do the same thing here.

Trainees

If the big cities get stars and drones, what happens out in the countryside? Well, there will be tremendous opportunities at those big, expanding MNC stores and offices. In Shanghai or Beijing many bright young graduates weigh the choice of working for Siemens or HuaWei and HSBC or BOC. In the countryside and 3rd tier towns, young people often don’t get those kinds of opportunities. Well, when Starbucks, Wal-mart and other MNCs start opening doors all over China, they are going to be the first job and/or career for lots and lots of locals. Working in the warehouse of Best Buy or slinging Big Macs may not be your dream-job, but it’s a big step up for millions in smaller cities and villages through-out China. These flashy, modern companies are going to make a big impression on small-town China, and once they draw in a youngster as a Customer Service Trainee they are likely to hold on to him and work him until retirement. Supported by those big-city back offices, MNC retail or sales outlets will work at a higher level of sophistication and efficiency than any other institution these people are likely to have experienced. MNC outposts in smaller Chinese cities will take over where the public schools leave off – training, organizing and caring for large numbers of people engaged in service to an unseen organization.