The Future Arrives Early
Many companies and executives also view this period as an opportunity for them accelerate the maturation of their business and employees by raising expectations and performance standards in their organization.
In my own, recent CEO address, I was very direct in telling our people that it will be very difficult for us to grow at the same rate as previous years. I also emphasized, however, that in the coming year, we will be doing many things to continue to build our business for the long-term, such as significantly raising our branding and positioning in the market and being one of the stronger companies to manage through this difficult economic time.
Actually, like many companies in China, this is the direction that we have always been heading towards anyway to become a highly professional, world-class company. The global financial crisis is just driving it to happen with a greater sense of urgency. As a result, during this downturn, many businesses here are requiring their staff (both mainlanders and foreigners) to show a greater level of maturity, commitment, and value than they have in the past.
Showing Your Value
“For many mainland professionals who have never experienced a market downturn before, the coming months are going to be a rude awakening,” according to a human resources director in Shanghai. “In good times, just about everyone does pretty well. But in a down market, you can really tell who the stronger performers in your organization are, versus the ones who are only able to be successful when facing a more positive situation.”
“Very few of our mainland staff are in the habit of getting involved in new assignments, or showing their willingness to take on additional projects, like helping to identify new business opportunities or develop new resources for the company,” says the country manager of a mobile internet company. “Others are always telling you what they can’t or don’t want to do. It’s not a good time to be doing that right now though.
“We expect every one of our employees to be thinking about and demonstrating what they can do to bring greater value to their position during this tough period. It’s a time when we expect them to be doing anything and everything they can to contribute and support our company’s success. That’s an orientation that is becoming increasingly more important for anyone in this market. At this time, you want to be showing your value to those around you. If and when we need to make difficult staffing decisions, guess who are going to be the ones we’re going to keep and protect.”
Tougher Times For Expats
For many foreigners working in China who are receiving some type of premium compensation package, it’s also going to be a challenging time. With global companies in heavy cost-cutting mode these days, just about every China operation is looking closely at whether the positions currently occupied by foreigners can be handled by a local professional. Even if it is determined that it is unable to happen right away, then the next question is, by when?
That’s not to say that there is no longer a need for many types and levels of international talent in this market. Of course, there is. Or that expat packages are no longer going to exist. They will (mainly, at executive management levels). It’s just that most foreigners are going to have to adapt to more localized compensation packages, as well as increase their ability to differentiate and demonstrate their value to employers here.
Good For The Long Run
Through all of this, the China operations of global companies are still expected to aggressively pursue and deliver strong business growth. In fact, with substantially lower numbers being projected in major markets like the U.S. and Europe for 2009, the pressure to grow revenues and achieve results in China are even greater this year for many operations. However, with many industries and markets here slowing for once and with many new business initiatives put on hold or under review by home office, it’s a chance for many operations to reassess their staffing and talent needs.
On the plus side, we do not see positions among our multinational clients being eliminated altogether as is the case for many positions in other overseas markets. Rather, we are confident that the hiring freezes we are seeing represent a delay, or push, in their staffing plans for China. As the situation becomes even more dire around the world, we even expect an acceleration of activity in the mainland as companies try to compensate for considerably lower revenues being forecasted elsewhere.
For many in China, it’s going to be a more painful experience than they’ve ever experienced before. In the coming year or so, in particular, companies and professionals in the mainland are all going to have to get sharper and better in order to continue to compete successfully. For their long-term growth, however, this is a good thing in terms of quickening their process and development towards becoming more “world-class” in their standards and capabilities.
