Talent shortage in China
By Liu Jie (China Daily)
Angie Eagan admits she is good at solving problems, and as the general manager with the headhunting firm Hudson Shanghai she is helping multinational companies in China find the talent they need – a task that she also admits isn’t always easy.
Hudson is a worldwide provider of permanent recruitment, contract professionals and talent management solutions worldwide.
With more multinational companies establishing and expanding their presence and more Chinese companies emerging, finding the right people to fill the right positions, especially at the leadership positions, is a challenge for any firm, according to Eagan, who has 20 years of experience in the field and has worked for 12 years in China.
“Multinational companies’ (MNCs) expectations for the capability of their local staffers are much higher,” says Eagan. “And many of them who have to localize their human resources management find getting the right people is not easy. Getting capable leaders is even more difficult.”
Her conclusions come from study and research by Hudson, meanwhile, a series of surveys from other firms confirm the findings. A survey by the US-based management consulting firm Hay’s found that finding the right people for leadership positions is the No 1 challenge for MNCs headquartered in Shanghai. It also conducted a survey on the Fortune Top 500 Companies, and 35 percent of the respondents said they believed recruiting and retaining capable senior executives with a global view and local knowledge is the toughest challenge.
Eagan cites an example. A senior executive whose company was a newcomer to China told her that his company’s job description is one level, but he has to hire people one level down and pay them two levels up. That is because he cannot find people meeting his demands but must also have somebody to support the group’s establishment and expansion here.
“This is the talent shortage in China. It’s truly a candidates’ market right now,” says Eagan.
Faced with the challenge, companies have shifted from being willing to continually hire to caring more about how retaining and training their employees.
Eagan specifically mentions the talent shortage in the middle and senior levels.
She says there is a lot of stress on executives for several reasons. One is that many managers are filling positions for which they are not trained, experienced or capable.
Second, companies are often growing quickly in China and even if some leaders are capable, their duties expand with the growth. If the company has trouble finding filling new positions, the managers end up doing two, or even three, jobs.
According to Eagan, people that MNCs need most are those who can meet with their levels and who will be leading their local companies within five to 10 years.
When a MNC wants to build its business in China, what it is really looking for are potential leaders, who learn the company’s business, and culture and are able to teach other people.
“Those are the most difficult people to find right now, what we called like the second-line managers,” Eagan says.
Basic characteristics
There are a few dynamics really important for business leadership in China. One is an ability to build strong business partnerships, which includes building partnerships with the government.
“This is something you might not do in another area of the world, but here you should think about your relations with the government and what you can do to aid the society,” says Eagan.
Companies also have to work with suppliers and customers – as well as sometimes with competitors – so partnership building is very critical.
Furthermore, a leader should have clear vision and sense of purpose, because there are so many unexpected, frequent changes in China that a business leader needs to be able to clearly articulate his or her direction.
A leader also needs to manage change and be able to put the steps in place to help people and encourage them to all move in the same direction.
“If you don’t change your company under these market dynamics, it means your company probably dies,” she says.
A corporate leader in China should also be really resilient, she says.
“If you hit a wall, you don’t fall back and say ‘Oh, no’, you just stand there and ask yourself, ‘Yes, how do I go around it, how do I go over it?’ says Eagan, adding that a leader has to be somebody who can absorb negative experiences and keep going.
Solution
As one of the world’s leading executive recruitment and related consulting services firms, NASDAQ-listed Hudson has over 148 offices in more than 20 countries and regions and 3,600 staff worldwide with 1,500-plus in Asia Pacific. Its revenue exceeded $1.4 billion in 2006.
Entering China in 2000, the firm has three offices under two brands in China: two Hudson offices in Shanghai and one in Hong Kong called Tony Keith which is in IT recruitment and acquired by Hudson last year.
Eagan says her pride in Hudson China comes from “exceptional people”. There are about 180 staffers in its China offices aged mostly 33 to 35. More than 90 percent are local consulting talents.
“We value our people, who are really good and professional,” say Eagan, adding that Hudson cares great deal about training and growing its people.
The firm has a large database, a professional research team and senior consulting service talents.
Consultants work with researchers to make sure they get the full picture of the industries that are looking for employees. Then they interview candidates, offering reports and suggestions for the clients. They negotiate with the clients and candidates on salary packages, positions and contracts. Ultimately they help the two sides seal contracts and related agreements.
“We typically run all process within four months, it’s very fast (compared with the average industrial level),” says Eagan.
To help retain and grow talent, Hudson has a talent management division to identify and train leaders and future leaders to take senior positions within three to four years.