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The major Human Resource (HR) issues which are critical for the success of the company in China include performance appraisal, retention, turnover, and staffing philosophy.
Performance appraisal is the process of evaluating employees in an ongoing manner to know their progress. Performance appraisal is also aimed at giving the employees an opportunity to disclose their job-related concerns and their input on how best to improve on performance. It also gives an organization an opportunity to understand the kind of people who are working for it.
The results of performance appraisal are supposed to give an organization a sense of direction and inform any changes which may be necessary to keep the organization on course of making profits or attaining its goals and objectives.
If the company performs appraisals regularly, it would understand the levels of commitment and loyalty of its managers. Consequently, it would address the concerns which may make the managers have a low commitment by coming up with remedies such as incentives to motivate them or even sacking them and replacing them with others (Sinha & Sinha, 2008).
The employee performance appraisal could also make the managers understand that their job is depended on their performance and levels of commitment to the organization. Such an understanding could make them either quit employment early or dedicate all their energy and loyalty to the organization.
Retention and Turnover
Retention has to do with making sure that employees do not quit their employment for whatever reasons, real or perceived. It is achieved by having good management practices such as good remuneration, having a good working environment, teamwork, and good relationships between top management and middle-level management.
Turnover is the reverse of retention and has to do with the rate at which employees leave their jobs in an organization. It is caused by various reasons key among them the poor working environment, low remuneration, and lack of cohesiveness in an organization (Griffin & Pustay, 2001).
To enhance retention and avert turnover, the company should establish a cohesive organizational culture, which is very critical in the retention of employees. Many organizational researchers agree that a cohesive organizational culture is the one in which all members of an organization hold to similar beliefs and values which bond the organization together. These beliefs and values may be implicit or explicit to the organization, meaning that they may be or not be outlined in the organizational core values.
Cohesive organizational culture also facilitates the alignment of organizations for the achievement of their objectives, mission, and vision without much difficulty. This is because the employees are not only fully aware of the mission, vision, and objectives but have also internalized them. This makes employees motivated to accomplish the set organizational goals, targets, or objectives.
The best staffing philosophy for executive and managerial employees the company should adopt is the ethnocentric staffing model. With this model, organizations prefer employees from the parent country to those from the host country or other countries. The reason is that managerial employees are supposed to be people who understand the organization in and out.
They are also supposed to be people whose character is well known by the organization. Above all, they should be people who should have demonstrated some degree of loyalty and commitment in the organization as well as people who are well informed about the organization’s short term and long term development agenda (Delios, 2012).
If the company recruits parent country managers to oversee its business in China, it may lose on the aspect of understanding the culture and local market, but gain by having loyal employees managing its business in China.
To overcome the challenge of poor understanding of the local market and culture, the organization should invest resources in training its expatriate managers on cultures and markets for different countries before they are dispatched for expatriate assignments. However, the company should consider hiring local employees for its nonmanagerial jobs because parent country nonmanagerial employees are expensive due to relocation and remuneration costs.
Delios, A. (2012). International Business: An Asia Pacific Perspective. Mumbai: FT Press.
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Griffin, R.W., & Pustay, M.W. (2001). International business: a managerial perspective. Upper Saddle RiveUr, NJ: Prentice Hall.
Sinha, P.K., & Sinha, S. (2008). International business management: a global perspective. New Delhi: Excel Books.