Hrm In China Essay Example

Piercy, 2006). Following are some aspects of the main changes of HR function. . 1HR as a strategic partner Along with making changes to HR leadership, organizations worldwide are also changing their perception of the HR function. According to Mercer’s survey (2006), 67% of respondents said that HR leaders are viewed as a strategic partner, participating in strategy discussions and decisions. The same percentage of HR leaders (67%) reports to the CEO, compared to 54% in the 2003 study.

All these shows that the HR function has spent less time on its traditional HR activities such as recordkeeping and delivering HR services and more time on strategic partnering.Excellent HRM always pay more attention to the distribution of human resource in the organization. Nowadays, the role of HR plays is both HR manager and strategic partner through integrating technology and management. What they need to focus on is not only the traditional personal things but also put much more emphasis on the activities of making strategy on the development of organization. This means HR managers are supposed to treat recruitment, selection, training and development as strategic practices. Therefore employees can make a great contribution to the organization by sharing the same organization value, operation and culture.

. 2From “human resource” to “human capital” In the past, people in organization were treated as “resource” to the organization. But today they are seen “capital” where to invest and add value. In the last decades, workers have been treated as the necessary resource to organizations.

However, this is not enough, they should be considered as human capital which adds value to the business and create more value to the

organization. The difference between “resource” and “capital” is obvious. According to Wikipedia, “Human Resource” is another name for labor.But “Human capital” refers to the stock of skills and knowledge embodied in the ability to perform labor so as to produce economic value. It maybe cost but can be profitable to the organization. It is useful resource (Wancheng Wu, 2006).

At the end of the 20th century, many industries were trying to boost productivity by helping employees to expand their skills (Microsoft, Encarta). This means more and more companies have realized that the employees are assets to the organization where to invest. 2. 3Use of Electronic Human Resources (e-HR)During the last decade, more and more HR managers have begun to use computers in their daily work because the personal computers and laptops are available and accessible. Moreover, the human resource management system (HRMS) is much user-friendly. With such modification, HR managers are sure to spend less time on personal administration compared several years ago.

According to Kanul Goenka (2003), Electronic Human Resources (e-HR) has shortened the cycle of management and reduced the duplication of traditional HR operations so that making work more efficient.In addition, e-HR can make HR departments from providing simple HR information to offering the solutions which can support the top manager’s decision making at any time and finally easily building up a human resource management system which supports the HR department itself. (Wenyuan XU, 2007) 3. Stage of development of HRM in China HR practices usually rely on the economic development of a country. HR practices in Chinese enterprises do not share the same HR model. That means the development stage of HR

profession in china is various in different ownerships of organizations exist in china.

In the following part of this essay will analyze the development of HRM in different types of organizations including state-owned enterprises (SOEs) Foreign-owned enterprises (FOEs) and Sino-Foreign Joint Ventures. 3. 1State-owned enterprises (SOEs) For decades, China has been using the same set of personnel management politics, which was established during early years of Socialist China, to cover a wide range of occupational staff working in state sector from managers in state-owned enterprises to medical doctors in public sector. Fang Lee Cooke, 2005, P41) This implies that in most SOEs, they still had traditional human resource management systems. The reason why most SOEs had this HRM maybe involved in the following factors. First of all, HR managers in SOEs do not need to directly deal with the human resource because workers were usually assigned to enterprises by the government.

Fang Lee Cooke (2005, P43) advocates that traditionally, SOEs in china, which employ the majority of the workforce, have been the patron of the workers’ welfare. Equally important, these SOEs had close ties with government and make contribution to local development.Therefore, usually they are limited by the local government and at the same time facing more constrains which can be the barriers during the innovation of HRM. Shan S. Liu (2006) present that inherited from the historical burden of the planned socialist economy, the HR function in most state-owned enterprises are generally underdeveloped in China.

However, when China opened its economy to foreign investors in 1970s, the employment environment has changed a lot, many HR managers in SOEs have much more authority to hire and

fire employees. 3. Foreign-owned enterprises (FOEs) Since china introduced the “open door” policy, economic reforms have brought a lot of changes to business environment. Many FOEs entered China market with lots of new HR practices. They do not have more constrains compared to SOEs. Their HR practices are usually directly adopted the international HR practices based on western systems (Benson and Zhu, 1999).

Most of HR leaders in these enterprises are viewed strategic partner. This means HR managers have been accepted as a professional group in the organization.According to a recent survey conducted by Mercer (2006), 59% of HR leaders have a significant contact with the board of directors on issues beyond remuneration, such as talent management, succession planning, and human capital implications of mergers, acquisitions and other transactions. Moreover, this trend continues in these days. The statistics of the survey conducted by Mercer (2006) shows that HR leaders indicated that they would like to spend less time on recordkeeping (from 27% at present to 14%) and more time on strategic partnering (from 15% at present to 27%).

3. 3Sino-Foreign Joint VenturesIn many Chinese local companies, they were suffered a transformation from a traditional HRM to a new one. They adopted a HR management style mixed with “Chinese characteristics” (C. H. Tan, D. Torring, 2004).

Facing the ever-increasing economic globalization including China’s entry into the WTO, competition in the international market and greater participation in globalization, many Sino-Foreign Joint Ventures appears in employment market. They combine foreign and local methods in HRM. These enterprises usually have a traditional perspective of HRM, but now they have introduced new HR practices.For example, a performance-based pay system is

gradually replacing the seniority pay system (Warner, 2001).

The explanation for this HRM is because more enterprises have to complete in the global market rather than remaining in the protected domestic market (Cherrie Jiuhua Zhu, 2005). Therefore, these enterprises need some innovation about HRM. At the same time, China has a market economy with Chinese characteristics, so the HRM in these enterprises are more or less influenced by this economic environment. 4.

Major challenges facing HR managers in chinaAfter three decades of economic reforms and promises of prosperity, China is enjoying a high and stable economic growth. In the process of moving up the economy ladder, many multinational enterprises (MNEs) have made a great contribution. After a steady stream of foreign direct investment began in the late 1970s, the trend has accelerated. China’s entry into the World Trade Organization (WTO) in 2001 made more changes in the business environment. Therefore, there must be many changes in the HRM in Chinese enterprises as mentioned before.

In the process of this innovation, HR mangers are sure to face many challenges. 4. 1Acquiring key talent Because of many Chinese enterprises such as Sino-Foreign Joint Venture are suffering a HRM transformation and shift from a focus on the traditional human resource process and technology to human capital strategy, HR managers not only have to know the traditional HR knowledge but also to have a good command of knowledge about helping top mangers to make decision as a strategic partner. In order for the HR function to move forward with its transformation, organizations must implement a talent strategy that arms HR with a range of skills, especially those that relate to

finance and business, so that they can be more effective business partners,” explained by Ms. Piercy (2006), a principal and HR effectiveness expert in Mercer’s Human Capital business.

4. 2Hard to implement performance management system A noticeable change of HRM in China has been the use of performance-based management system.There is a growing trend that more SOEs are linking employees’ performance much more close to their reward, promotion and job security. However, it has been advocated by academic researchers that the implements of performance-based management system was a major challenge faced the HR managers (Fang Lee Cooke, 2005). For example, it has been represented that Joint Ventures in China have suffered difficulties in adopting performance management as an internal strategy in their corporations (Braun and Warner, 2002).Lockett (1998) argues that Chinese culture may be potential barriers in the process of adopting western HRM techniques like the performance management system.

4. 3Cross-culture difficulties In today's global economy, HR managers must be able to identify and work with various types of cultures that exist simultaneously within an organization. During the last two decades, which have witnessed a growing internationalization and globalization of businesses in China, there has been an increasing demand for HR managers among especially those in MNCs to improve their knowledge about regional and cultural differences between nations.One lesson here is that Chinese and Westerners see workplace relationships differently.

Chinese are more comfortable with a boss who is above them in the organizational structure while westerners are more at ease with managers who are more-or-less equal to other team-members (Irene Hau-Siu Chow, 2003). Under this different background, it raises conflicts between workers and managers. Therefore,

HR managers have to know the culture shocks between China and America, and thus to deal with the conflicts appropriately. 4. 4Difficulties of enforcing social security policiesEnsuring the employers to meet their social security obligations is a central requirement of Chinese government to assist the evolution of Chinese economic markets. And enforcing the social security policies has also become a challenge for HR managers as they are normally the ones who handle the current social security policies within enterprises (Guan, 2000).

As social security reform has facilitated the personal risk management like how individuals match the job to their own skills, it has a great impact on the workforce such as HR planning and the motivation to employees (Cherrie Jiuhua Zhu, 2005).All these problems, to some extent, need the HR manager to consider extensively. 5. Conclusion As we look at the history and content of HRM, there have been numerous changes in the world of human resources (HR) as well as in China during last decade. The role of HR mangers in organization has changed from a traditional personnel manger to a strategic partner.

Meanwhile, Employees are no longer treated as resource but capital in enterprises. Because of the innovation of computer technology, Electronic Human Resources (e-HR) plays an important role in the modern HRM which to some extent changes the HR function.In order to outline what stage of development is the HR profession in china, this essay analyze different ownership of enterprises in china including state-owned enterprises (SOEs) Foreign-owned enterprises (FOEs) and Sino-Foreign Joint Ventures. HRM in these enterprises usually are not the same since the organization structures, enterprises background and management philosophy is

various. However, no matter what types of organizations they are, all of them have evolved in the HRM over the last several years.

In the process of revolution of HRM in China during the last decade, HR mangers are facing challenges they haven’t met before.First of all, they need to acquire key talent to adapt the changing function of HR. Secondly, it is hard for HR managers to implement performance management system instead of the seniority management system in some SOEs because of culture shocks. Thirdly, HR managers should be able to identify and work with various types of cultures that exist simultaneously within an organization. Finally, carrying out the social security policies has also become a challenge for HR managers as they have to enforce these policies within enterprises.

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