HR Professional - August/September 2008 - (Page 25)

Foreign direct investment poured into Beijing to the tune of US$75 billion dollars in 2007. More than US$350 billion has been invested since 2001—as international companies eye China’s 1.3 billion consumers and its 803.3 million–strong workforce with dreams of cheap labour. China’s massive economy, coupled with its growing influence around the world, points to a new global hegemony for the 21st century. “It seems clear that China will be the next global superpower, but what kind of superpower will it be? Will it have the same priorities for human rights, fairness, respect for international law and free trade as current and past superpowers?” says Brian Bemmels, professor and chair of organizational behaviour and human resources at the University of British Columbia’s Sauder School of Business. says Grace Wong, assistant dean of international business at the Sauder School of Business. While there are several examples of failed ventures in China, Wong points to a number of successful Canadian endeavours, including Ivanhoe, Manulife and Nortel. “The farther away the market and the more different the systems, whether legal or cultural or business norms, the more a company should carefully do its home- business. Large companies who want the fewest wrinkles use consultants to guide them. Small companies only interested in sourcing inexpensive products cannot do this alone, yet many are unwilling or unable to pay consultants to help them,” he says. THE NEW EAST China may be the new economic frontier—witness the recent rise of Shanghai’s futuristic skyline—but ‘‘ You may find less evidence of the ancient dragon and more of the bucking bronco. work, market research and due diligence,” says Wong. She advises companies to choose partners carefully and make active use of available resources such as Canadian trade offices. “China is too big a market to ignore,” she stresses, “but each company needs to make its own careful assessment, learn from the experience of other companies in China and mitigate whatever risks it can.” Frank Feather, an international business futurist and author, has acted as a special advisor to the Chinese government since the 1980s and echoes Wong’s advice. “The main reluctance to go to China has more to do with resource constraints and/or the fact that many companies—especially mid-size ones—feel they still have much opportunity to exploit inside NAFTA, which is true. Large companies feel they can go it alone, especially if they have employees formerly from Hong Kong on staff. This is a big mistake—Hong Kong business is nothing like Chinese scratch the surface of all that glass and gleaming metal, and you may find less evidence of the ancient dragon and more of the bucking bronco. “It is the Wild West here and I don’t think it will improve all that quickly,” says Les Lothringer, founder of West/Asia Strategy Consultants, a veteran business consultant and strategist and advisor to foreign companies on how to “negotiate” China. For companies with an adventurous spirit, the road to China is not always clear. Proponents extol the rich cultural experience and limitless opportunities, while others less enthralled cite the philosophical, practical and psychological divide they claim exists between East and West—distinctions that create challenges not always easily overcome. “Westerners working for Chinese companies often encounter difficulties, due to the highly political nature of Chinese hierarchies, their traditional ways of dealing with issues and their historical A u g u s t / S e p t e m b e r 2 0 0 8 25 ’’ CANADA: COMMITTED OR COY? Canada, admirably reticent or characteristically backward, depending on your point of view, has demonstrated some reluctance to jump on the Orient Express, contributing a meager $1 billion in total investment. According to a recent Maclean’s article entitled “How to Lose Your Shirt in China,” which described a number of devastating Canadian business failures in China, too many companies are guilty of jumping into unfamiliar cultural waters with their eyes closed. “Many Canadians would be more comfortable doing business in Canada or with the United States, but that may not continue due to the rapid growth of economies in Asia. As well, China’s huge role in the global supply chain impacts many businesses, whether or not they directly do business in China,” w w w.H RThought L eader. c om http://www.HRThoughtLeader.com

Table of Contents Feed for the Digital Edition of HR Professional - August/September 2008

HR Professional - August/September 2008 Contents Editor's Letter Contributors Leadership Matters Upfront Legal Compensation Human Capital The New Frontier On Message Strategy HR 101 Interview with Annette Veschuren Talent Management Training Work/Life Balance Off the Shelf The Last Word

HR Professional - August/September 2008

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