In r Oduction

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    INRODUCTION

    The People's Republic of China (PRC) is the world's second largest

    economy by nominal GDP and by purchasing power parity after the United

    States. It is the world's fastest-growing major economy, with growth rates

    averaging 10% over the past 30 years. China is also the largest exporter and second

    largest importer of goods in the world.

    As of 2012 large state-owned enterprises (SOEs) are the backbone of China's

    economy producing over 50% of its goods and services and employing over half of

    the workers in China, 35% of business activity and 43% of profits in the People's

    Republic of China resulted from companies in which the state owned a majority

    interest. There are more than 30,000 state owned enterprises in china as of 2011.

    One of the hallmarks of China's socialist economy was its promise of employment

    to all able and willing to work and job-security with virtually lifelong tenure.

    The government virtually decides what companies have to do especially when it

    comes to state-owned-enterprises as a result there is little scope for people

    development, but from the year 2006 the policy of the government is changing and

    state-owned-companies are given more flexibility to decide on matters which

    affect them.

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    RECRUITMENT AND SELECTION

    It is mainly based on skills, employment history, total work experience, language

    abilities and career goals.

    Recruitment techniques

    Advertisements- Job ads are not permitted in the news media without

    approval from the local labour and social security department.

    Job fairs

    Campus placements

    Job centers

    Employment agencies

    State owned companies go for internal recruitment. Politics play an important role

    in recruitment and selection. Those loyal to party are given promotions easily.

    Foreign companies recruitment from employment agencies and universities.

    SELECTION PROCESS

    References

    Unstructured interviews

    Work sample tests

    Written honesty test

    Investigation using 3rd

    party

    Punctuality is very important in Chinese companies. Respect to the top

    management is demanded. Relationship with top management will help you get

    higher positions in the company.

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    WORK CULTURE

    1. Confucian value

    Harmony

    Obedience or subordination

    Circular thinking- what goes around comes around

    2. Indirect Communication

    3. Management-The art of war is a great military treatise written by a Chinese

    general of the 6th century BC. The amazing thing about this book is that if you

    replace War with Business, Army with Enterprise, General with

    Businessman, you get the oldest Business strategy book of the world. In this

    book, there is a sentence that says The general should be calm, reserved,

    methodical and fair

    Calm

    Discretion or confidentiality Method

    Fairness

    4. Consensus

    5. Caution

    6. Ambition

    7. Respect for age & hierarchy

    8. Personal relationship or Guianxi

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    COMPENSATION AND REMUNERATION

    Executive compensation

    Basic annual remuneration- Depends on assets of the company, profit, taxpaid, sales, foreign exchange earned by the company.

    Performance annual remuneration- 40% of the performance annual

    remuneration is based on the growth rate of the net asset and the other 60% is

    based on the growth rate of the realized profit.

    Annual bonus remuneration- Based on the growth of the company above

    industry average.

    Minimum Wage- Depends on locality, average minimum wage is RMB. 3000/

    month ($550)

    Insurance is compulsory for all level of employees.

    Minimum of 90 days of maternity leave.

    Holiday and annual leave- based on experience

    Employees with between one and ten years of work experience are to receive a minimum of five

    days annual leave per year.

    Employees with between ten and twenty years of work experience receive a minimum of ten

    days per year.

    For more than twenty years of work experience, the employee receives a minimum of fifteen

    days per year. These laws apply to all employees, including managers.

    Women receive extra half day compensation.

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    UNIONS

    To establish a union, 25 workers simply join the union, and the employer will

    usually be required to accept the request. However, unions in China differ greatly

    from their counterparts in many other countries. First, the primary function of

    unions is to avoid labor unrest, not to advocate for the interests of workers. Second,

    while many unions exist in China, all unions must maintain an affiliation with the

    All-China Federation of Trade Unions (ACFTU).

    Average working hours

    10 hours/day 6 days/week

    Power distance- very high

    Performance appraisal

    Performance appraisals favor workers that are loyal to the family. Performancereviews are done infrequently in China (usually once a year)

    Expats in china

    593,832 expats working and living in china [2011 estimates].

    Culture Shock-No matter how long you live, how fluently you speak Chinese you

    will always be an outsider or a Laowai.

    Language- Sensitive to English but people appreciates if you try to speak mandari.

    Staff Turnover- very less

    Team- does not exist between expats and locals.