After a thorough research on the Chinese market, various challenges relating to human resource management were identified. The possible challenges that the ABC Company could face as it establishes itself in China were seen to revolve around the cultural environment, political environment, deployment, among others (Chow et al, 2008, 690). The complexities involved in operating in a business outside Australia for the ABC Company, will raise the issue of differentiation in the modalities encountered in the acquisition of various categories of employees. The human resource managers will at all times be required to promote the cultivation of values, ethics, and beliefs in the management of workplace diversity (Mungenast, 2007, 6). Additionally, they should motivate the employees thus enhancing their chances of achieving their goals and objectives.
The cultural challenges that will be faced be ABC Company in China can best be explained by Hofstede's theory that assumes that most managers operate in businesses that traverse various cultural values and will ultimately influence how management practices are carried out (Aswathappa & Dash, 2007 36).The culture of a certain society will always revolve around family structures, educational structures, religion, and forms of government. This approach always values the orientation of culture and the planning of human resource management and will indicate the involvement of individual in a particular task (Brown & MacBean, 2005, 22). It influences the distinct psychological variables that influence the working environment. This Hofstede's approach is suitably used in this study since it will show the differences between nations by showing the relationship of individuals in the work place and motivational techniques. He argued in his part that people can either work as solitary individuals, or collectively. Motivational orientation will be influenced by the gender of the workers and this creates a lot of challenges in the society. Uncertainty avoidance of the employees and power distance are the parameters that will create challenges to the ABC Company as they open outlets in China (Bowen et al, 2002, 117).
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There are a lot of cultural characteristics that causes challenges human resource management practices in China. Most workers in China are always worried about the security of jobs that they are willing to do. This is aggravated by hunger and political confusion that took root in the late 1950s and early 1960s. This made a lot of people to be inclined towards the jobs that are long term. This is a great challenge to the ABC Company because its human resource managers will be forced to change tact and to employ people to work on permanent terms. Doing anything contrary to this will lead to poor recruitment since nobody would like to work on jobs that have limited security (Chow et al, 2008, 690).
The collectivist nature of the Chinese society as explained by Hofstede's theory will make it hard for the company to acquire the best talented people. This is because people are not willing to stand out from the crowd and do not like taking risks. The 'Quanxi'/connections as part of Chinese culture are also seen as one of the challenge that faces HRM because any relationship between the managers and their subordinates influences those that are to be hired. The mode of acquisition and rewarding employees in this case is done on the basis of 'who-knows-who' and this creates a potential trouble to international companies that may not understand it implications (Mungenast, 2007, 6).
The political environment may also be another source of challenges to the ABC Company especially in terms of currency, conflicting laws, and handling the skyrocketing prices of goods and services. It is important to note that the government has laid rules that restrict the mobility of labor from one state to the other (Aswathappa & Dash, 2007 36). This means that the company may be forced by the prevailing circumstances to employ individuals who are not qualified to perform a particular task, if they establish their business in the place where the required professional can be found (Zhu, & Warner, 2004, 320). Additionally, another challenge arising from the political point of view is the fact that the government of usually grabs the very qualified personnel to work in the ministries and other offices. This will leave the private sector with few qualified people (Pudelko & Harzing, 2007, 547). They will have no other choice but to employ individuals who may be having lower standards than what is required by their HRM. This is a challenge that may greatly affect the quality of services given and offered by the company.
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Other challenges that may be faced by the company in the course of establishing its business in China includes the acquisition of individuals with questionable habits since there is a high competition for the qualified individuals. Other challenges related to deployment are the requirement of workers to join trade unions and the employment of individuals who may no be necessarily qualified. The advancement in technology each and every day creates a challenge to the company since it may have to retrain its employees each and every moment (Brown & MacBean, 2005, 21). This greatly contributed by the dynamic nature of China's economy that is changing drastically each day.
How these challenges differ from the US and the UK
The challenges likely to be faced by ABC Company in the UK and the US are drastically different from those that are faced in China. One example is the fact that in China, companies have to invest a lot of money to help them unearth the best candidates from the multitude who are hiding due to their notion that they should work collectively as explained by Hofstede's theory (Boselie, et al, 2005, 80). The challenge faced in the Anglo-American and European market however is the stiff competition of employees who believe they can work best as individuals (Vance et al, 2006, 61).This capitalist notion of the individuals forces the human resource managers to invest a lot of money in competitive recruitment drives as they will try to identify the best employees.
As earlier indicated, employees in China can only join one trade unions while in the UK and the US market, they can join as many as they want (Pudelko & Harzing, 2007, 547). This creates a challenge to the company since the employees are given the opportunity to demand many rights that may not be met easily. The freedom of employees to move freely in the European and the US market threatens the company's workforce and anytime they can loose valuable employees to the outside market. While it is a challenge in China to reward employees in China due to the 'connections', it is a challenge in the US and the UK when all employees become very competitive to an extent that it becomes hard for the management to identify the best ways to reward their employees (Bowen et al, 2002, 117).
Another aspect that exists in the Chinese market from the US and the UK market is the Anglo-American HRM practices where there is wide acceptance and importance in the utilization and development of the abilities of the employees. This is taken to be a means of encouraging competition within the workforce and is usually done government policies that promote education and trainings of employees (Mungenast, 2007, 6). The ultimate result is the supply of very qualified personnel with the required skills in the market. This system also consists of a five-phase program designed to train employees on the various cultures that they will encounter as they work. This is aimed at meeting the various challenges and be able to work with minimum obstacles. This minimizes the challenges met but it is however lacking in the Chinese HRM market where there are a lot of challenges associated with expatriation and absence of Anglo-American model complicates the whole situation (Pudelko & Harzing, 2007, 547).
The European mode of labor development, management and capitalism has been developed in the sense that it is designed to curb the cross-cultural challenges that may prevail in the market. One case for instance is the policy that may appear to favor capitalism exemplified by the Social Charter framework that outlines sufficient steps concerning the mode of rewarding employees (Jackson, 2002, 148). This is a good way of tackling the prevailing challenges in HRM in the European and the US by finding ways to face the problem of controlling benefits costs on the member states. The quest for capitalism in the European market has also seen the reduction in the collective bargaining power of employees and a promising decentralization in the future while the development of irrelevant unions being further reduced (Pudelko & Harzing, 2007, 547). This promotes 'individualized' professionalism that may in the long prove to be less challenging than the group behavior witnessed in the Chinese market. This is a drastic contrast with the challenges faced in such a market like China where the government has poor HR policies resulting in a cycle of endless challenges (Aswathappa & Dash, 2007 36).
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Any company that has decided to operate globally should be ready to face the challenge that accompanies the decision. It is clear from this research that China brings mores challenges to the floor and ABC Company should consider them critically before rolling out its operations. The business will only be successful if the company braces itself to face the cultural, political and the other challenges (Jackson, 2002, 148).