The Human Resource Management Concepts in China - Case Study Example

HUMAN RESOURCE MANAGEMENT IN CHINA The Human Resource Management Concepts in China The term human resource management refers to the practices and policies needed to carry out the peoples’ resource aspects of a management position (Sun, 2009). These aspects include training, rewarding, appraising, recruiting. The HRM concept in China involves the coherent and strategic approach to manage the most of organization’s valued assets. The people involved work individually and collectively and contribute to achievement of organization’s goal and objectives. HRM concept also comprise of human capital management which is an approach that the organization uses to obtain, analyze, and report on data which informs the direction of value adding people management strategic investment and operational decisions at corporate level and at the level of front line management (Sun, 2009). Similarly, the HRM concept also involves personnel management that is concerned with organizing, motivating and obtaining human resources that are required by the business. People management is also another important HRM concept and entails the policies and practices which govern how people are managed and developed in the organizations. Discussion of HRM Approaches used in China (Administrative personnel approach or Human Resources Approach) China contains a mix of HR personnel management system and more modern human resource management practices. There is increased use of human resource management approach in China today as the Chinese enterprises have developed more partnerships with foreign firms. China has adopted a new strategic role that is concerned with developing the organization and capabilities of its managers (Sun, 2009). The recognition of poor enterprise productivity and efficiency linked with low education levels has created a need for HR development. The management development programs have been introduced in major Chinese cities, for instance, training of HR professionals. The HR manager, an example of HR professional in China, also ensures that employees have the mechanisms required to contest unfair practices. The Human Resource approach that is used in China today encompasses the activities that are required to maintain the productive workforce. These include human resource administration, career and succession planning, performance management, payroll and benefits, learning management, workforce tracking, focusing and scheduling (Sun, 2009). It also includes relevant legislation, local agreements, work timings and the individual employees’ contracts. The human resource management approach helps the organization in providing opportunities for high potential workers, supports implementation of the business plan, improves the employees’ morale, and identifies the replacement needs. Moreover, human resource management approach involves recruitment and selection of employees/staffs. The key aspect of employment in the Chinese firms is its irregularities. In most cases, they develop formal employment processes and policies on the surface but the written rules are often not adhered to in the implementation. These processes and policies are replaced with short cuts that reflect the top management’s priority and interests. There compensation system has changed. It is linked to skills, performance, and job levels. It is outside official salaries. The best HRM practices in China in term of implementing the standard HRM approach The HR practices relate to company performance and contribute to customer and employee satisfaction. They also contribute to the productivity, innovation and growth of a suitable reputation of the company in the society. These practices include: Recruitment and selection: This involves the design of policies and procedure for fair recruitment and selection in order to contribute to the fulfillment of the organization’s corporate strategy (Rovai, 2004). For instance, the Sino-Euro Oil Group Company carries out interviews, monitoring and giving advice terms and conditions of employment. The most qualified personnel is selected and offered a job at the company. Learning/training and development: This practice involves the teaching of employees on how to perform their work. Trainings namely “on-going learning” at Sino-Euro Oil Company, is aimed at improving the performance of the employees in the company or firm (Rovai, 2004). It ensures that there is availability of skilled, knowledgeable and ready workforce for the company. The employees or persons intending to work for the company are given a prior training on the company’s operations, processes, finances, the customers, authority, and ethics. Workforce management: This comprise of all the activities that are required for the maintenance of a productive workforce. It involves learning management, career and succession planning, human resource administration, time and attendance, scheduling activities, workforce tracking, and emergency support services for the employees (Rovai, 2004). Time and attendance are important to the delivery of a company’s daily objectives because they comprise work timings, laws, agreements, and work life balance guidelines. For instance, medical leave of absence and family care. Performance Appraisal: This is the formal system of assessing the performance of a company’s employees. It helps the employer to identify the challenges hindering employee performance, identify the solutions to the problems, and plan career development. Company brand image and learning systems is considered as the core policies that attract and retain top talents in the local Chinese market (Rovai, 2004). Performance management also determines promotions, transfers, improvement of productivity, and compensation of the employees by communicating their expectations. The differences between the Government Sector and Private sector in term of implementing the HRM The private sector companies in China are those companies that are managed and owned by the citizens and not the state or foreign investors (Wei, 2010). The government sector HRM deals with those companies and enterprises that are owned and managed by states and governments. The private and government sector implementation of HRM in China The Chinese private sector companies are sourced from the family firms. They are managed by personal relationships and not formal management policies. These private sector firms are concentrated in low technology and labour intensive sectors. They freely adopt new management practices, develop green sites and have less organizational push and social burden. The HR management system for the Chinese private sector lacks a comprehensive and consistent HR strategy (Rovai, 2004). These private sector firms offer less career development and training as compared to the government owned enterprises and the key management positions are confined to the family members. Comparison of the Government and Private sector implementation of HRM in China and the world The government sector has a more established HRM system than the private sector. The state owned sectors are larger and have a much more government influence. There are divergent practices and views towards HRM in China and other global states (Wei, 2010). The Chinese view promotion of a younger staff to a position above their previous managers as a loss of face. Although these promotions reward outstanding performances and creates an upward mobility for dedicated workers, the Chinese partners may reject them. This will eventually drag the productivity of the company. In other parts of the globe, there are no such influences that are in the Chinese HRM system (Wei, 2010). Hence, there is maximum freedom to borrow and import management practices from other local and international sectors. The only constraints faced by enterprises from other parts of the world are the institutional and legal differences which can be modified to standard HRM practices to fit the native conditions. The companies that implemented the HRM concept in China successfully Kerry Logistics Company a company that encompasses international freight forwarding, integrated logistics and chain supply has successfully implemented the HRM concept. The company believes that the development of quality products and services go hand in hand with the development of quality people. The company fosters an ongoing partnership between the staff and management that is built on fairness, respect and mutual transparency between the two groups. For instance, the assistant manager is assigned with the duty to oversee the daily operations of the logistic team in the warehouse in alignment with client’s request and internal policy. In addition, formulate policies and set operating procedures for warehouse, inventory and logistic management. SBA Stone Forest Company which is a professional advisory firm with its presence established in China and covers all major cities is well positioned to provide expert human resource consultation and payroll. The company’s cross-border experience and local knowledge in the retail sector, allows them to support their clients in managing their labor costs (SBA Stone Forest, 2015). For this reason, the workers are able to deliver their core business in providing quality customer service to their clients. SBA focuses on the three key areas on the retail sector that include; Labor cost management- working for long hours has seen rise in two key challenges for the management. The first is to control labor costs with wiry staff and the second one is to match staffing levels to the flow of customers (SBA Stone Forest, 2015). The company, therefore under PRC laws provides for flexibility and minimizing of the requirements of overtime compensation. Employee retention management- SBA stone forest retains experienced and productive employees despite the higher levels of employee turnover. For this reason, it maintains a more stable workforce for a longer term hence motivating its employees to attain and succeed higher levels of employment. Employee relationship management-SBA Stone Forest (SBASF) has created an in-depth relationship with its employees by ensuring that the customized handbook is compliant with the labor law (SBA Stone Forest, 2015). Summary HRM practices in China have proven effective and efficient and companies have proved success in its implementations. China uses several approaches to curb HRM. These concepts are concerned with organizing, motivating and obtaining human resources that are required by the business. People management is also another important HRM concept and entails the policies and practices which govern how people are managed and developed in the organizations. There are lots of differences between the government sector and the private sector in terms of HRM implementations. The public sector seem to be organized more than the private sector in terms of implementations of HRM. References Cooke, F.L., Stoney, J. & Wright, P. (2015). The Routledge Companion to Strategic Human Resource Management. Routledge, New York. Retrieved from http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0CCUQFjAB&url=http%3A%2F%2Fir.nmu.org.ua%2Fbitstream%2Fhandle%2F123456789%2F119722%2F7a12dab9245d3a55e97b4a459a751ac8.pdf%3Fsequence%3D1&ei=IeJLVZqkNor_7AbQ1IHwDQ&usg=AFQjCNGU_4SEdu88NUplR9_8vv2bh3dajQ&sig2=tjEw-lPGNB4A4BqScJQLFQ&bvm=bv.92765956,d.ZGU Kerry Logistics. (2015). Retrieved from http://www.kerrylogistics.com/eng/main/search.jsp?key=human%20resource%20management Rovai, S. (2004). HRM Practices in MNCs (Multinationals) Operating in the PRC: an Institutional Perspective. Newcastle School of Management. Retrieved from http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0CCQQFjAB&url=http%3A%2F%2Fwww.who.int%2Fhrh%2Fen%2FImproving_hrm_capacity.pdf&ei=3t1LVarxM6TW7QaI-ICYDg&usg=AFQjCNGYzEMuq jPGLQNKR3EbMt2h5ZBmA&sig2=P3lwx_8TdMwnWp1mKWtMwQ&bvm=bv.92765956,d.c2E SBA Stone Forest. (2015). Solution for Retail-Human Resources Outsourcing (HRO): Helping You with Business Expansion Support & Talent Management. Retrieved from https://www.linkedin.com/company/sba-stone-forest-corporate-advisory-shanghai- Sun, J. (2009). A Study of Human Resource Management in a Joint Venture Organization Compared To a Locally Owned Organization in China. Unitec, New Zealand. Retrieved from http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CCUQFjAA&url=http%3A%2F%2Funitec.researchbank.ac.nz%2Fbitstream%2Fhandle%2F10652%2F1248%2Ffulltext.pdf%3Fsequence%3D1&ei=s89LVffhMcGBmQXHx4CADg&usg=AFQjCNHYezsjnzo-9bqbl2Uk9VS214oRGQ&sig2=BPumfIZQL2DSIORzjjmCFQ&bvm=bv.92765956,d.dGY Wei, S. (2010). HR Practices and Challenges in Chinese Firms: Comparison with Western Firms. BS Psychology Zhejiang University. 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