Talent Localization of Multinational Corporations in China

1. Talent Localization of Multinational Corporations in China

2. What We Know About Talent Localization • Wal-Mart stores, BP, ExxonMobil, Shell Group, ToyotaMotorect. • Obstacle：cultural difference • Therefore, it’s common for them to hire local employees. Advantages: adapting to local culture, effective cost performance, avoiding expatriation failure.

3. What We Know About Talent Localization However, the performance of the strategy in China is not as good as expected.

4. What is Talent Location? • Talent localization, as a key method to manage local subsidiaries of MNCs, refers to the situation that jobs in MNCs used to be filled by expatriates are now taken by local employees who have strong ability to do the job (Selmer 2004). In another words, talent localization refers to using capable local talents to fill the jobs originally held by expatriates (ibid.).

5. Literature Review 1. Problems of applying talent localization strategy • Lack of high-qualified talents (including high-qualified managers and high-level veterans) According to a research done by AmCham Shanghai survey of US-owned enterprises, 37% companies said that recruiting talents was the biggest operational problem instead of a lack of transparency, bureaucracy, and the infringement of intellectual property rights (The McKinsey Quarterly 2008) • The favor of expatriates • High turnover rate

6. Literature Review 2. Solutions for the Problems of Applying Talent Localization Strategy • First of all, young talents with high education. These talents are future of foreign subsidiaries because they are fresh blood that can ensure the operation of the company. Also, foreign subsidiaries can train them and increase the percentage of local talents in management positions gradually (Saxon 2006) • Second, offer good welfare to local employees, such as compensation for overtime work, special pay for the Chinese New Year and necessary pension and insurance required by labor law (Saxon 2006).

7. Literature Review 2. Solutions for the Problems of Applying Talent Localization Strategy • Thirdly, provide necessary local talent management and specialty training to enhance their international views and attitudes on multinational management. It will improve the understanding between local subsidiaries and headquarter (Saxon 2006). • Lastly, business ethnics training should also be offered to local talents, not only for preventing dishonest or unethical but also the stable management in local subsidiaries (Saxon 2006).

8. Method • This article tends to explore the talent localization of multinational corporations in China from both a theoretical point of view and a practical aspect. Although many researchers have developed and improved the theory, the performance of the application is not satisfying. Therefore, the article includes a deep look at the practical application of talent localization of a typical MNC, Microsoft, under the particular business environment of China. • Materials used in this essay: 1. secondary data (research papers, business journals, official websites and surveys). 2. previous from both online and through the library of the University of Manchester.

9. Discussion • 1. Should MNCs still apply talent localization? • 2. What problems occur when MNCs apply talent localization causing their failure in local human resources management? • 3. What are the solutions for the problems for making better talent localization strategies?

10. Implications for MNCs In China, foreign companies should have local talents top on the list. Moreover, they should offer necessary training for both first-level employees and middle or senior managers. Last but not least, they should pay more attention to senior management and high turnover rate.

11. THANK YOU!!