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Performance Management

 

Focus on China

Kellye Whitney

 

Productivity, engagement and motivation are all key performance management considerations. But when performance management activities happen internationally, how do those considerations differ among countries?

Jihong Sanderson, founder and executive director of the Center for Research on Chinese & American Strategic Cooperation at the University of California, Berkeley, said the definition of performance management can have different meanings in different countries.

Performance management is well-received in the United States, but in China, performance management in particular (and human resources management in general) is not as well-developed because China has been an open market to the rest of the world for only the last 25 years or so.

“In the United States, it’s more about processes, creating a work environment or seeing which people are able to perform to the best of their ability,” Sanderson said. “You would include lots of elements, like developing a clear job description, selecting the best people. But in China, it’s very dependent on the company.”

For example, a small to midsized company might not fully understand the American definition of performance management, Sanderson said. Thus, a small company won’t provide effective employee orientation and training or design effective compensation systems.

A large company, on the other hand, might have a more in-depth understanding of performance management and have already brought in different events and management systems.

Further, Sanderson said China is still a hierarchical and collective culture with a mindset based on long-term relationships, familiarity and trust — not necessarily rules or management procedures. Multinational companies looking to institute performance management practices in China often already have procedural and systemic ideas related to employee behavior because the talent management or HR management space at home is well-established.

“It’s like an orderly trimmed garden, whereas in the China market, if you drop anything on the ground, it will grow into a tree. Grass is not allowed in the well-trimmed garden. What that means is, in the China market, things are quicker, short-term and low-price,” Sanderson explained. “That means the employee mentality is very opportunistic. In the U.S., it’s more about long-term strategy and stable behavior. Because of those differences, people behave very differently.

“If an American company wants to really develop in-depth performance management in China, they have to change the incentive system. You can’t just apply it directly. How are you going to capture people with that quick, short-term mentality and make sure you retain them?”

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