Formerly many of the executive positions in China were held by expatriates. But, now the situation has changed.

China is one of the most exceptional places in the world for conducting innovative business activities. Many multinational and international level firms have chosen China as their destination to carry out their core business functions. In recent years, China has witnessed high levels of Foreign Direct Investments (FDI), especially in the arenas of automotive, energy, electronics, retail sectors, and telecom business.
 
As a result, the country now holds the distinction of being one of the major sources of overseas revenues for many international business firms. In fact, the country is now expected to become the largest human capital market in the world, thereby demanding a substantial number of talented executives as well as professionals.  
 
Formerly many of the executive positions in China were held by expatriates. But, now the situation has changed. With the increased awareness of education and the procuring of better education from western institutions, many Chinese people now outshine the expatriate professionals, and as a result many of the executive positions in the country are now occupied by Chinese.
 
As such, talented Chinese people are now able to acquire better positions and earn incredibly high incomes. This is also beneficial for the companies, since it may cost them double when they appoint an expatriate professional to fill an executive positions in China. Apart from local companies, many US and other multinational companies operating in the country have now started appointing ethnic Chinese professionals to fill the top-most vacancies in their firms.  
 
In China, firms looking for executives have four classifications of professionals to choose from; a professional, who is non-Chinese, ethnic Chinese expatriates, Chinese returnees, and Chinese locals. A non-Chinese expatriate usually comes from the headquarters of a multinational company, and would be adept in business functional arenas, however, this individual most probably would lack local language skills as well as knowledge of local business practices.
 
In the case of ethnic Chinese emigrants,  they mostly belong to such regions as Hong Kong, Singapore, Taiwan, or from any part of South-East Asia. They would be expert in both regional and international business matters, and could effortlessly understand the Chinese culture and language. However, their remuneration would be almost same as that of the the non-Chinese expatriate.  
 
Falling under the category of Chinese returnees are talented professionals born and brought up in the country, but educated in a western country and then repatriated to China. These people not only excel in international business matters but also in regional business matters and have local language and cultural skills.
 
However, such talented people are seldom found. When it comes to the Chinese locals, they are born and brought up in the country, and in contrast to Chinese returnees, they have never left the country for education or employment purposes. Although they are talented, they may sometimes lack English language communication skills as well as international expertise in handling business affairs. In addition, the quality of their leadership may not be top-notch.  
 
Once a company has done its head hunting and recruited the right executive, it is important to develop an environment that is favourable for the leader to develop and nurture their talents. This in turn is highly important for the retention of competent leaders. To this end, certain business firms utilise systematic as well as rigorous programs to assess and retain the talents of executives. Another great way to retain a talented executive is to provide them with attractive compensation packages.

 Additionally, rather than money, executives must be given adequate recognition and praise. Hence, it would be even better if a talented executive is given an opportunity for media exposure, thereby enabling him or her to be in the limelight. Above all, effective communication as well as motivational programmes could help in retaining a competent executive in China.  
 
However, headhunting is quite a chaotic process. Hence, through their understanding of the importance of quality executives to a firm, along with the problems involved in their recruitment, many high-end executive search firms are offering their services to companies to help them to find and retain a competent leade. These firms carry out a range of services in connection with the recruitment of capable as well as skilled top executives, such as, devising effective recruitment plans, publishing short list, administration services, and executive placement and follow-up.

By Wolfgang Jaegel of Hunt Partners, a high end  Executive Search firm  providing search and human capital solutions for global and regional clients who require discreet search of  top management and board level positions .

Reprinted with permission of articlesbase.com

Related features:

Doing business in China:

Part I 

Part II 

Part III 

New labour union rules in China 

Recruiting, developing and retaining staff in China

Lessons from the front lines of doing business in China