Case Study: Recruitment, Retention, and Rewards in China

The world nowadays has been evolving into a border-less world. Many Multinational and Global companies are outsourcing their employees and hire a talented worker from overseas. Many Multinational Companies are also seeking lower cost labor with equal talent, skill, and ability. Most of them are outsourcing in some developing countries especially in China that widely known as over-population country with enough good labor quality and lower cost as the added value. However, I highlight some problems in China that caused difficulty in retention of the worker which are inequity, unwell-organized reward, and improper benefits for local employees.

First, I spot the problem that in China there is an inequity between local staff and foreign staff in terms of salary as I learned in Chapter 10. Moreover, there is an increase in foreign company and joint venture company to operate their business in China in which strokes a sense of inequity among local workers. The effect of this inequity sense can cause a decrease of working motivation where at the end it will make the employees/workers quit the job. To solve this issue, both local and foreign companies need to consider this situation by equalizing the salary, benefits, and so on. The government also need to protect their local employees so there will be no more discrimination senses.

Second, in Chapter 11 I learned about incentives and rewards. I notice that the reward system in China is not known well between the employees/workers. It is not caused by the sufficient money to provide the rewards, in fact, the employees tend more to higher salary and monetary compensation where includes hourly wages, salaries, incentives, merit raises, and commissions. It can be basically a culture of Chinese workers dislikes the rewards especially the Team Rewards or I assumed that there is a not well-organized rewards system that makes them disengaged to get rewards.

Third, in Chapter 12 I have learned that there are mandatory benefits which are social security, workers’ compensation, unemployment compensation, and family and medical leave. From the case I read, I notice that Chinese workers concern more about work-life balance and their life when worked in the certain company. It indicates that the Chinese worker also concerns more about their future prospect, management style of the company, company’s culture, and social security. To retention the Chinese workers, the company need to consider that aspect. Especially to the social security and compensation that become two of favorable benefits in China because it influences their decision to stay with their current employer or not. Lastly, a job seeker in China is more concern in salary and compensation they will get in the future. Therefore, the company needs to consider this trends so they can empower worker and they will work their best.

In conclusion, to overcome the problems of worker retention in China both local and foreign company need to evaluate their policies regarding equity, rewards, and benefits that they offer to their employees. Knowing the worker's desires, mindset and culture is important to help the employees stay and loyal to them. It will useless even though the cost of labor in China is lower if all company cannot engage their employee to work harder and being loyal with improper inequity sense, rewards, and improper benefits.