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Blog: Global Work Watch - Workforce Planning
 

April 14th, 2008

Planting Seeds for Success in China

There’s an ongoing contest between the U.S. and European economic systems. And one of the key battlegrounds is nowhere near New York, Dallas, Brussels or Berlin. It’s China—that is to say, which side of the Atlantic is best able to work with and take advantage of Asia Pacific’s emerging economic powerhouse?

A recent press release from the other side of the Atlantic pond highlighted one way Europe is sowing the seeds for long-term success in China. It called for European managers to apply to the European Union-China “Managers Exchange and Training Programme,” a 10-month program that includes intercultural training, Chinese-language study, seminars, visits to Chinese companies and a three-month internship at a Chinese or European company in China.

METP is a four-year effort of the European Commission and the Chinese government aiming to serve a total of 200 managers from the European Union and 200 managers from China.

The program is tailored for frontline and midlevel managers. Applicants are supposed to have no or only very limited knowledge of Chinese language; be between 26 and 40 years of age; and have a minimum of five years of work experience.

The U.S., too, has been willing to have government play an active role when it comes to commerce with China. But U.S.-led business exchange efforts, such as the U.S.-China Oil and Gas Industry Forum seem geared to helping high-level executives make connections with Chinese counterparts.

I’m not aware of any U.S. government program akin to METP—one that encourages managers lower down in organizations to develop expertise and relationships in China. That expertise and those relationships can translate into concrete business deals as METP participants advance in their careers.

METP is of a piece with Europe’s focus on “sustainability” and long-term thinking. Both the U.S. and the European Union face widening trade deficits with China. And both would like to close those gaps by exporting more to China. Will the investment in budding managers in the METP program pay off for Europe down the line?


April 4th, 2008

Death By a Thousand Job Cuts

The news of major U.S. job losses in March is ominous for a number of workforce management reasons.

The U.S. Labor Department said Friday, April 4, that the American economy lost 80,000 payroll jobs in March. That was worse than expected and the biggest one-month loss in five years. Payroll employment figures also were revised to show greater job losses for January and February, and the unemployment rate rose from 4.8 percent in February to 5.1 percent in March.

The first problem with these numbers is they suggest companies are ignoring the sage advice to try to weather the economic storm by limiting layoffs or avoiding them altogether. Instead of taking a near-term hit to profits and investing in long-term growth, companies seem to be cutting jobs heavily.

Such short-term thinking could come back to haunt U.S. firms. Jettisoning talent and potentially damaging morale for remaining workers can cripple companies and their ability to bounce back in better times. Stanford University business professor Jeffrey Pfeffer says companies tend to give up people too easily in downturns only to pay a steep price for talent during good times. “You should not do what most companies seem to do, which is buy high and sell low,” Pfeffer says. “There’s an unwillingness for companies to behave counter-cyclically.”

McGill University management professor Henry Mintzberg argues that the U.S. penchant for axing workers gives Europe an edge in recovering from a recession. “Europe is better prepared. Much better,” Mintzberg says. “The soul of the enterprise is much more intact in Europe. There’s much more respect for the idea of collective effort there.”

Then there are “tragedy of the commons” concerns about widespread layoffs. Each job cut can help push the overall U.S. economy into recession—or deeper into one—as consumer spending and confidence suffer.

U.S. stagnation in turn threatens to tip other parts of the world into economic trouble. Asian companies and economies depend heavily on the spending of U.S. consumers and businesses.

A vicious circle can come into play, as foreign countries’ woes afflict U.S. exporters and further depress the American economy.

To be sure, some companies can’t help but lay off workers in dire circumstances. And economic turmoil requires government leadership in addition to smart actions by businesses. What’s more, there are some enlightened companies that behave “counter-cyclically.”

But are there enough to keep the U.S. economy from sliding further?


November 16th, 2007

Industrial Policy No Joke

In America, the concept of government playing a major role in guiding the economy is usually scoffed at. Industrial policy is thought to be a distasteful, counterproductive thing without a place in the free enterprise system. Except that the U.S. government does in fact support various industries, most famously the agricultural sector. And as globalization proceeds and more high-paying U.S. jobs are threatened by overseas competition, there’s an argument to be made for a stronger government presence in “picking winners and losers.”

Helping some sectors succeed through research funds, training programs and possibly even temporary tariffs isn’t just an approach that may appeal to citizens and workers keen for good jobs and a measure of economic security. Businesses, too, can benefit in the form of early access to new technologies and skilled employees.

Various agencies devoted to regional economic development do some of this already in the United States. But our efforts seem to pale in comparison to what a number of other countries have done. Consider South Korea’s treatment of the animation industry. A recent New York Times story about a new SpongeBob SquarePants episode noted that much of the animation for the cartoon was done in South Korea:

“In the 1980s animation began to migrate overseas because the labor was less expensive and because animated shows were not selling well in the United States. The labor is still somewhat cheaper, Nickelodeon executives said, but South Korea dominates in animation because the country has built an infrastructure for the practice while in the United States there is little formal training for animators.”

Indeed, the Seoul Metropolitan Government has named animation as one of Seoul’s “strategic industries.” The government-funded Seoul Animation Center  was founded in 1999, and its activities include “the operation of various educational programs in order to produce capable human resources, support for new talents and productions, organization of events and exhibitions including animation film festivals, and the operation of an efficient information center.”

In a recent blog item Salon.com senior writer Andrew Leonard ties the SpongeBob show to the way industrial policy has promoted economic growth in East Asia.

“Chinese and Indian animation studios are now undercutting the historical Korean price advantage in cartoon production,” Leonard writes. “But cheap labor isn’t the only key to surviving in the global economy. So is finding your niche. Why are SpongeBob cartoons made in Korea, even at this late date in the evolution of Korean economy? At least in part, because the government made it a priority.”

Cartoons may not be the right niche for America at this point. But certainly there are other possibilities, including various “green technologies.” It may be time for Americans—and American businesses—to take the idea of industrial policy seriously.


October 12th, 2007

The Oracle of Internationality

An Oracle software demo just showed me what a truly global workforce might look like.

At the HR Technology Conference and Exposition this week in Chicago, Oracle presented a test version of its WebCenter technology, which can allow employees to set up informal networks devoted to a particular topic, as well as alert colleagues about job openings.

It’s noteworthy that Oracle is keeping abreast of the push for more peer-to-peer interaction in the work world. But in a way, the more intriguing aspect of the demo was its international flavor.

Gretchen Alarcon, Oracle’s vice president for human capital management strategy, showed audience members how a U.S. employee of a fictitious software firm might link up with a colleague based in Shanghai on the basis of a shared work interest. As part of that cross-Pacific bonding, Alarcon had the Shanghai employee zap information on a job opening to the U.S. worker. The U.S. employee applied and landed the position.

What struck me was how nonchalantly the hypothetical U.S. employee decided to move to Shanghai. Of course, that was partly a result of the way the software demo condenses time. Alarcon didn’t call attention to details like visa hurdles, whether an expatriate compensation package would be involved and the way a real employee would wrestle with issues like leaving family and friends for what could be an extended stint, or the health impacts of China’s air pollution.

But it seems to me Oracle’s presentation could be a window into a future of ever easier and ever increasing globe-hopping by workers. When I graduated from college nearly 20 years ago, spending a few years in New York was a common adventure. Now we’re reading about U.S. college grads going to India to work in its tech sector for a spell.

Speaking of the shrinking globe: On the flight from San Francisco to Chicago, I was sitting next to Amy Wilson, director of human capital management strategy for Oracle, who was largely responsible for the WebCenter demo. We realized that we grew up in the Buffalo area, attended the same high school and have the same sad memories of the Bills losing Super Bowls. Small world indeed.


March 15th, 2007

The Fat, Mean Economic Machine

Don’t call China a lean, mean economic machine.

Yes, it’s an economic machine, what with growth of at least 10 percent for four years running.

And it can be mean—witness the way the country violates basic human rights and has played hardball amid allegations it subsidizes exports through an undervalued currency.

But lean it ain’t. A striking feature of both Beijing and Shanghai is the way so many people are working in jobs that seem superfluous.

Private security guards are everywhere, despite little semblance of public disorder. Shops and restaurants often seem to have more people than they need. At one of the upscale Jenny Lou’s markets in Beijing, for example, three people worked at the checkout counter. One rang up sales while two handled items. This labor-intensive process wasn’t well-coordinated—there was some bumbling along the way.

The dramatic Grand Hyatt Shanghai, which is located in the Jin Mao Tower, meanwhile, had greeters at every turn. One female employee stood at the entrance to the hotel’s lobby on the 54th floor, apparently waiting for visitors to stumble out of the elevators.

You can make an argument that at luxury businesses, piles of people help ratchet up customer service. Or perhaps Chinese consumers are used to high numbers of humans staffing their shops. Excess employees may even be a strategy to please government officials, who have reason to worry about unemployment and resulting social unrest.

In any event, it seems China has a lot of fat built into it. This surprised me given the way the country has otherwise embraced capitalism.

An intriguing twist to this topic comes at the leadership level. It makes sense for executive ranks to have a deeper bench than they might otherwise have in North America or Europe, says Hong Kong-based consultant Maura Fallon. That’s because senior managers in China should ideally be spending 40 to 50 percent of their time coaching more junior leaders, she says. Without such a heavy commitment to people development, Fallon says, China operations will suffer, given the tight market for managers properly seasoned to lead in multinationals.

Many organizations expect the same amount of business decision-making on the part of their China leaders as they do elsewhere—which is misguided, she says. “Companies are so lean that the China executives don’t have time to mentor and develop relationships and trust,” she says. “In China, you can’t be as leanly staffed as you are in the West.”



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