Over the Great Wall

Sun-Tzu, the ancient Chinese philosopher who authored The Art of War, had a saying, “Sacrifice the plum tree to preserve the peach tree.” It means that there are circumstances in which one must sacrifice short-term objectives in order to gain the long-term goal. He was writing about military strategy in the seventh century B.C., but that’s the recommended approach when it comes to recruiting in China. Establishing a recruiting operation in China requires patience and persistence. Quick rewards are not likely.

The Chinese can put up some amazing numbers — and not just those having to do with the ages of their gymnasts.

The Middle Kingdom produces over 2.5 million college graduates, including 30,000 Ph.D.s and 650,000 engineers, every year. But employers looking to fish in this ocean of talent will find that there’s a lot of cuttlefish along with the bass.

Graduates of the top schools compare with the best in the world, but wander a little further away and the quality of education becomes questionable — by one estimate over two-thirds of the engineers are no better than technicians. This is a particular concern with private schools, most of which haven’t yet established their credentials but often team up with top-flight state-run colleges to attract students. Despite rules enacted by the Education Ministry that require these schools to issue diplomas under their own names, instead of the name of the better-known institution, violations are rampant. When evaluating academic credentials it becomes critical to find out where a person actually studied.

China’s educational system relies heavily on “memorization,” meaning that skills such as creative writing, public speaking, teamwork, and leadership are not taught well in most of China’s universities. A study by The Conference Board concluded that the “learning by rote” culture of the Chinese education system means its graduates often lack the practical experiences and softer creative and leadership skills required in the modern business world.

The Legacy of Mao

A half-century of communism has had some effects on Chinese society that Marx (Karl, not Groucho) likely never imagined. With the state controlling every aspect of their lives, many people find it difficult to do anything that falls outside their defined responsibilities. Many managers find that employees never attempt to work on anything not directly concerned with their specific role. Recruiters must be extremely explicit in explaining a job description and attempt to cover all the tasks that the job could require. And jobs that require a lot of creativity may be difficult to staff.

Another legacy of communism is a generation of only-children. China introduced the one-child policy in 1979 in an attempt to control the population. A generation of children with two parents, four grandparents, and no siblings is now of working age. Never having interacted with siblings and studying in an education system that does not emphasize group activity, many cannot see themselves as others do and have a grossly inflated sense of self-worth. So jobs that depend on teamwork need to be very well-managed, since many employees are unaccustomed to working in groups.

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While educated Chinese workers are generally, bright, urban, eager to work, ambitious, and dedicated, multinationals also report a range of common problems. These include poor foreign language skills (especially spoken English), education that was often too theoretical rather than practical, a lack of experience accompanied by an expectation of high salaries, rapid advancement, and frequent job-hopping.

Not Enough Chiefs

Despite the abundance of talent, leadership and managerial skills are in short supply. Mid- and senior-level talent often has to be brought in from the outside. Chris Gootherts — International Staffing Manager for Microsoft and an expert on recruiting in China (a source for some of the material in this article) — has built a process to recruit high-level talent to China, since local talent is unavailable. The Conference Board study mentioned above found that the number of people aged 40 and over was not generally well educated, and did not constitute an adequate pool of talent for companies. But, those in their 20s and 30s have high levels of educational attainment and are hungry for responsibility, position, and the trappings of success in order to support not only themselves but also their aging and large extended families. That’s both good and bad — while willing to take on challenges, they will also readily move between employers in order to get a bigger salary, more status, and more opportunities: in other words, high turnover.

China’s growth has been primarily built on manufacturing. Seasoned talent in other industries is hard to come by. For example, in software development, it’s difficult to find anyone with more than four to five years of experience. Unlike India, which has been an IT hub for over 20 years, the range of skills in China tends to be limited. There are some extremely bright and talented people working in R&D labs run by the likes of Microsoft, Cisco, HP, and others, but IT talent that has experience with the full-range of product development is limited.

Conclusion

China has a lot of talent to offer, but the market remains competitive, and recruiting requires a great deal of effort and preparedness. Microsoft needs to screen 25,000 college graduates to fill 200 jobs. Despite the economic slowdown, wages in China are predicted to rise by 9% in 2009 and even more in specialty areas. Another quote attributed to Sun-Tzu (or maybe it was Dustin Hoffman in Kung Fu Panda) is, “Substitute leisure for labor.” It means choose the time and place of battle, and be prepared.

Raghav Singh, director of analytics at Korn Ferry Futurestep, has developed and launched multiple software products and held leadership positions at several major recruiting technology vendors. His career has included work as a consultant on enterprise HR systems and as a recruiting and HRIT leader at several Fortune 500 companies. Opinions expressed here are his own.

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2 Comments on “Over the Great Wall

  1. Raghav, I greatly enjoyed your article. As I recruit in a niche arena for several MNCs’, I can also validate your thoughts. While I cannot publicly disclose their identities, I have several Clients that refuse to hire talent that has graduated from Chinese Educational Institutions.

    There is one Client, however, who has set up operations in Canada to avoid our immigration policies. The reason for this is because they are bringing over Chinese ‘engineers’ (term used loosely) and putting them on a 6-mth training program to teach them how to move beyond theory and actually apply their knowledge. From what I’m told, there is also the issue of ‘initiative’. It is often seen as disrespectful to take initiative instead of waiting on ‘orders’ . . . so this is a shift in thinking that must be taught (to overcome a lifetime of being told what to do).

    During a trip to China in 2006, I visited scores of Chinese companies that presented the educational profile of their workforce (apparently to impress visitors/guests). In fact, it was one of the first talking points presented . . . suggesting to me that perhaps their valuation on the Hong Kong Stock Exchange may (in part) tie back to the mean educational level. What I remember is visiting several organizations that were comprised of 50% PhDs’. Something was wrong.

    I also remember several Execs speaking of their retention problems as well. Some companies spoke of 75% annual turnover . . . which rivals today’s Big-Box Publicly Traded Staffing Agencies.

    So my question to you is this: Is the recruiting the problem? Or should capital and programs be dedicated to retention first, and then development second? It seems to me that the order of issues here is: 1. Retention, 2. Employee Development, 3. Recruitment. The reason I say that is because of the fact that if 75% of all employees are going to turn over in 12 months anyway (considering things remain unchecked), why not tackle the root cause instead of optimizing recruiting efforts?

  2. I haven’t recruited much from China, but I find this article fascinating. There’s so much to learn on this subject. I imagine recruiting to/from China & India will be an entire recruiting career choice in the months and years ahead. Thanks for the great article.

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