Hong Kong and New York — Aug. 9
China and its executives will have a profound impact on global commerce amid predictions it will become the world’s largest economy by 2020, according to “Multiculturalism: China’s Gift to the Global Economy?” released today by Boyden global executive search.
The report is based on a series of interviews with Chinese CEOs, Western business leaders, consular officials and academics. In addition to explaining important shifts in the market including corporate leadership and human resources imperatives, the report addresses areas of opportunity for multinationals, Chinese enterprises and Chinese executives.
“Multi-polar globalization is sharpening the focus on executives who can be successful in China, whether Chinese or non-Chinese,” said Brian Renwick, Boyden board member and managing director of Boyden China. “We need to evolve Confucian-style relationships carefully so that then next generation of managers is more comfortable with leading and implementing organizational strategy.”
The report explores change at multiple levels including:
• For the company — Companies are adapting to a shift in trade patterns within China, the consequent evolution of “multi-polar globalization” and increasing commercial diversity.
• For the business leader — Business leaders are integrating China appropriately into the business plan and motivating teams through cross-cultural understanding.
• For Chinese and non-Chinese executives — Companies are becoming more flexible and focusing more on individual change.
“China’s ability to compete in the new global era doesn’t come from our products. It comes from our people,” said Anthony Chow, former president at newegg.cn.com and Ozzo Logistic. “For Chinese companies that do want to expand abroad, the lack of HR leaders is a serious barrier. If we want our companies to grow, we must hire, train with skills, develop into management and retain our best performers. This can only happen if we have world-class HR leaders in the senior team.”
The report offers the following advice for business leaders and HR management:
• Drive change at the individual level — There has been a tendency in some countries to steer China to what works in other markets. In fact, most Chinese business people have developed capabilities based on how state-owned enterprises are run from the central government. Change therefore needs to driven incrementally at the individual level.
• Change the mindset at headquarters to empower the local leader — Driving change at the individual level starts at the top — with empowerment. Once the leader of the Chinese business segment within a multinational is empowered, other key elements of HR policy can work.
• Be clear on expectations from HR — One of the biggest challenges ahead for company leaders revolves around how HR expertise is used. Large Chinese companies generally view HR experts as managers of people, benefits and salaries, rather than experts in developing leaders. A major change in mindset has to come from the head of the company.