City Research Onlineopenaccess.city.ac.uk/18006/1/Yeung_et_al-2008-Human_Resource... · How will HRM systems in these ... global integration? What challenges, issues, ... globalization

City, University of London Institutional Repository

Citation: Yeung, A., Warner, M. & Rowley, C. (2008). Guest editors' introduction - Growth and globalization: Evolution of human resource management practices in Asia. Human Resources Management, 47(1), pp. 1-13. doi: 10.1002/hrm.20194

This is the published version of the paper.

This version of the publication may differ from the final published version.

Permanent repository link: http://openaccess.city.ac.uk/18006/

Link to published version: http://dx.doi.org/10.1002/hrm.20194

Copyright and reuse: City Research Online aims to make research outputs of City, University of London available to a wider audience. Copyright and Moral Rights remain with the author(s) and/or copyright holders. URLs from City Research Online may be freely distributed and linked to.

City Research Online: http://openaccess.city.ac.uk/ [email protected]

City Research Online

http://openaccess.city.ac.uk/

mailto:[email protected]

Introduction

As many Asian economies’ expecta-tions continue to be surpassed (witha recent gross domestic productgrowth rate as high as 11 percent inChina for example) vis á vis an oth-

erwise darkening outlook for the worldeconomy (see “Economic and Financial In-

dicators,” 2007), they present opportunitiesfor firms around the world both to capturethese high-growth markets and to acceleratethe migration of their higher value-addedbusiness activities (like research and devel-opment, in addition to procurement, manu-facturing, and sales) to some Asian countrieswhere costs of labor are low but supplyabundant. Since 1980, the world’s supply of

GUEST EDITORS’ INTRODUCTION

GROWTH AND GLOBALIZATION:

EVOLUTION OF HUMAN RESOURCE

MANAGEMENT PRACTICES IN ASIA

A R T H U R Y E U N G , M A L C O L M W A R N E R , A N D C H R I S R O W L E Y

In this introductory note, we offer an overview of how human resource man-agement in Asian countries and corporations is evolving in the face of rapidbusiness growth and integration into the global economy and we describehow the articles in this Special Issue contribute to new knowledge and insightsregarding key issues, challenges, and evolution in the field of HRM in Asia. Dri-ven by the combined forces of rapid gross domestic product growth in manyAsian economies and their further integration into the global business arena,firms in Asia are in constant flux, no matter whether they are developedeconomies like Japan, Korea, and Taiwan; developing economies like Malaysiaand Thailand; or transitional economies like China and Vietnam. How will HRMsystems in these countries evolve and transform under the combined forces ofgrowth and globalization? We argue that HRM systems in these Asian firmsmost likely will evolve toward “bounded convergence.” The demands and ex-pectations of the HR function to take on strategic roles (versus administrativeroles) and address critical HR issues like attracting and retaining key talent,building talent pipelines, and creating high-performing cultures are greaterthan ever. We conclude with a high-level summary of the key contribution ofthe eight articles covered in this Special Issue. © 2008 Wiley Periodicals, Inc.

Correspondence to: Arthur Yeung, Associate Dean, China Europe International Business School, 699 HongfengRoad, Pudong, Shanghai 201206 P.R.C., Phone: 86-21-28905636, E-mail: [email protected].

Human Resource Management, Spring 2008, Vol. 47, No. 1, Pp. 1–13

© 2008 Wiley Periodicals, Inc.

Published online in Wiley InterScience (www.interscience.wiley.com).

DOI: 10.1002/hrm.20194

2 HUMAN RESOURCE MANAGEMENT, Spring 2008

labor has effectively quadrupled (Interna-tional Monetary Fund [IMF], 2007). The ef-fect of this growth has been dramatic for theglobal economy and it has produced a flowof low-cost manufactured goods that hascontained inflation in the advancedeconomies, other things being equal.

Of course, not all Asian countries followthis trajectory. Some, such as Japan and SouthKorea, face different demographic and labormarket challenges from others, such as Chinaand Vietnam (Rowley, 2007). Also, in thedecade since the 1997 Asian Crisis, Northeast

Asia remains different from South-east Asia in the performance of var-ious dimensions of employmentand the labor market, includingunemployment and productivity(Rowley, 2007). Meanwhile, manynational champions from Asianeconomies are rising up to be ag-gressive global players, as wit-nessed by recent high-profilemerger and acquisition activitiesundertaken by firms like CNOOC,Lenovo, or Haier, to name but afew. China has to date producedfew “world-class brands,” but thismay be changing. In the midst of

such rapid growth and globalization, the im-pact and implications on human resourcemanagement for firms operating in the regionat the ground level appears to be both pressingand pervasive. Indeed, the macro- and themicro-levels of analysis are intrinsically linked.The growth and globalization of firms in Asiaand the evolution of HRM in the region aretwo faces of the same phenomenon.

One of us recently had an opportunity tointerview more than 20 CEOs of leadingmultinational corporations (MNCs) in China,asking them one simple question: “What arethe most critical issues that affect the successof your company in the PRC?” While some re-spondents mentioned relationships withheadquarters, business model innovation,branding, supply-chain management, and soon, talent was by far the most consistently andfrequently cited factor that would critically af-fect their aggressive business aspirations. Ascompanies in many emerging economies have

been growing at a rate of 20–50 percent insales volume every year, the ability to attract,retain, develop, and engage high-caliber talentto support their business growth while simul-taneously deepening their competitive edgesin innovation, services, or quality presents oneof the greatest business challenges not only forMNCs, but also for local privately owned andstate-owned firms.

How do HRM systems in Asian countriesevolve as these economies experience such(perhaps unprecedented) rapid growth andglobal integration? What challenges, issues,and opportunities are Asian firms facing inorder to better utilize human resources forsustained business growth and competitive-ness? These two key questions about HRM inAsia, both at the country and corporate lev-els, are the focus of this Special Issue. By hav-ing researchers and scholars share their latestresearch and thinking in this vital part of theworld, this Special Issue can update our un-derstanding of the current state of HRMpractices in Asia and highlight key trendsand issues that both practitioners and schol-ars must focus on as they strive to increasetheir impact in the region. In this introduc-tory piece, we will first provide our overviewand perspective on how HRM in Asian coun-tries and corporations will most likely evolvein the region and then briefly introduce howdifferent articles in this Special Issue con-tribute to our understanding of these HR is-sues and challenges in Asia.

Impact of Growth and Globalizationon HRM in Asia

Evolution of HRM in AsianCountries: Converging, Diverging, or Hybrid?

As we examine how HRM systems evolve inAsian countries, it is important to under-stand their current situation before we pre-dict how they may change in the future.Hence, we begin with a conceptual frame-work that classifies Asian countries based ontheir political, economic, and cultural simi-larities and then discuss what may happen to

The growth and

globalization of firms

in Asia and the

evolution of HRM in

the region are two

faces of the same

phenomenon.

Human Resource Management DOI: 10.1002/hrm

Guest Editors’ Introduction 3

HRM systems in these countries in face ofthe powerful forces of growth and globaliza-tion. As Asia spans huge geographical territo-ries, we restrict our discussion to East Asiaand Southeast Asia, since South Asia is a sub-continent in itself and other Asia Pacificcountries like Australia and New Zealandbear more similarities to other Anglo-Saxoncountries than their Asian neighbors.

While we try to understand HRM systemsin Asian countries, it is important to acknowl-edge that their systems are not all unique tothe Asian region and many represent modifi-cations of those found in North America or Eu-rope. As a matter of fact, many HR practiceswere imported from the West through Ameri-can or European MNCs, Western businessmedia, and Western business schools and thendiffused to local firms. Such diffusion, or iso-morphism, occurs because organizations, espe-cially large-sized firms, have a strong tendency(or are under strong pressure) to copy moreprogressive management practices from or-ganizations that operate under a similar set ofenvironmental conditions and institutionalconstraints (DiMaggio & Powell, 1983). Asfirms in Asia become bigger and more globalin business operations, they are more receptiveto learning (or copying) international HRMpractices from the Western or Japanese MNCsfrequently studied in the HR profession, or toreceiving pressure from foreign partners orparent firms to adopt more systematic or pro-gressive practices in their people management(Bjorkman & Lu, 2001). However, idiosyn-crasies do persist due to different stages of eco-nomic development, variations in politicalsystems, and cultural differences in Asiancountries.

Within East and Southeast Asia, we findseveral relatively distinct clusters of nationalsystems. If we look at chronological develop-ments, we observe that some systems, suchas the Japanese system, evolved prior to oth-ers in the region. If we examine the politicalideology of these countries, some adopt cap-italism while others adopt socialism. Build-ing on our analyses in an earlier contribution(Zhu, Rowley, & Warner, 2007), we dividethese countries’ systems into three groups.The first one concerns developed economies

such as Japan, South Korea, and Taiwan. Thesecond includes developing countries such asMalaysia and Thailand. The third group cov-ers transitional economies such as China andVietnam. We treat as outside these categoriesthe city-states of Hong Kong and Singapore.

The logic for these groupings may be as-cribed to the earlier “flying geese” debate,which looked at the economic developmentof these countries chronologically andplaced them in a time line, start-ing with the earliest and movingthrough to the most recent (Dore,1987). The sequence started withJapan as the earliest example andmoved through to the later so-called “Little Dragon/Tiger”economies. The difference be-tween the developed and develop-ing countries seems to take intoaccount mainly the dates of“takeoff,” but also includes keyvariables they share in terms ofthe role of the state in guidingtheir path of development. Whilemany of these countries adoptedan openly capitalist regime, acommon thread they shared withthose in the transitional categorywas the crucial leverage of the“developmental state” (Amsden,1989; Johnson, 1982; Vogel,1991; Wade, 1990). However, itshould be acknowledged that therole of the state was more promi-nent in the third category ofeconomies, since they used the “commandeconomy” model (Warner, Edwards, Polan-sky, Pucko, & Zhu, 2005). In the face of eco-nomic expansion and integration into theglobal economy, rapid changes in each cate-gory mean that the role of the developmen-tal state increasingly is subordinate to mar-ket forces and relies on the relentlessexpansion and competitiveness of firms intheir countries. If present trends towardglobalization persist, the market will con-tinue to expand its influence; if not and aworld recession bites, economic recession inthese countries may put back into favor thestronger role of the state. With the banking

While we try to

understand HRM

systems in Asian

countries, it is

important to

acknowledge that

their systems are not

all unique to the

Asian region and

many represent

modifications of

those found in North

America or Europe.



crises of 2007, the “real” economy has notyet been smitten, and globalization rolls on.But it is too early as of yet to definitively saywhere things will lead.

Overlaying these categories, we find anumber of key trends relating to universalismand globalization (Rowley & Benson, 2004;Warner, 2002). To begin with, foreign invest-ment has occurred in all of them—not onlyin the developed and developing economies,but also in the transitional ones. China hasbeen a particular beneficiary of inward in-vestment; with this money comes an influx

of foreign-owned firms and theirways of managing the assets andpeople (Yeung, 2006). This influxoccurs through a diffusion processby which new management prac-tices spread to local firms, bothlarge and small. In larger organi-zations, many of which are state-owned enterprises, we find theimplantation of HRM practicesnot previously seen, as these en-terprises are restructured to bemore market- and business-drivenrather than policy-driven. “Hu-man resource management” as ageneric term has become derigueur. However, while many HRfunctions have changed thenames of their departments frompersonnel to HR, it takes time totruly transform these departments

from old-style personnel and administrativeworks to business-driven and strategic-ori-ented HR activities. A lag in practice still ex-ists in reality (Zhu & Warner, 2004). This phe-nomenon may, however, be seen as a“movable feast” as the evolution of manage-ment practices in China appears to be in al-most continual flux, as often seems to be thecase in the rest of East Asia. The diffusionprocess has been clearly under way for sometime not only in developed and developinggroups of country systems in Asia, but also inthe transitional ones.

No doubt, the importance of nationalcultures and values (like Confucianism, Bud-dhism, Islam, and Christianity) remains ex-tremely important. Despite commonly expe-

rienced waves of modernization that have en-gulfed these economies since the mid-nine-teenth century, each remains a recognizablenational entity. But since development camein such waves, we can group their nationalbusiness systems and HRM modes in differ-ent categories. For example, there is a notice-able degree of overlap in many of these coun-tries’ national systems so that we cancompare Japan with South Korea on the onehand and China and Taiwan on the other. In-deed, we can envisage intersections in a Venndiagram where all three categories of countrysystems might overlap (see Figure 1). Here,there are HRM characteristics that overlapamong the respective developed, developing,and transitional economies in Asia (Zhu et al.,2007). Based on such conceptualization, it isimportant to examine in future research: (1)what are the unique characteristics that dis-tinguish each category of national systems;(2) whether the overlap is increasing overtime; and (3) how such overlap is similar ordifferent from HRM systems prevalent inNorth American and European models.

The key debate regarding the evolution ofHRM in Asia is whether HRM systems in thesethree categories of countries will converge, di-verge, or move toward a “hybrid” Asian modelin the face of growth and globalization. Manywriters argue that globalization and growth inorganizational complexity are driving thesenational HRM systems to become more iso-morphic (resemble each other). Others placegreater emphasis on divergences, or nationaldifferences, such as in China, for example, re-ferring to HRM “with Chinese characteristics”(see Zhu & Warner, 2004). There is, of course,a “middle way,” in that one can show howglobalization produces similarities but at thesame time, distinctive national characteristicspersist in the systems. We may call this“bounded” or “soft” convergence (Warner,2002), and we believe this is the most likelyscenario to evolve over time. Our suggestionfor future HR research and practices is to de-lineate HR philosophies or practices that aremore receptive to the forces of global conver-gence (for example, those “hard” tools like HRinformation systems, pay-for-performancecompensation, design of training programs,

The diffusion

process has been

clearly under way

for some time not

only in developed

and developing

groups of country

systems in Asia, but

also in the

transitional ones.



and selection tools) from those that are moresensitive to national differences and cultures(for example, those “soft” tools like perform-ance management, coaching and mentoring,and people management styles).

Evolution of HR Focus in AsianFirms: Strategic or Operational

One of the major paradigm shifts in HRM re-search and literatures in the last two decadesis the emerging interest of strategic HRM andhigh-performing HRM systems when people(versus other resources like capital and tech-nology) are increasingly recognized as asource of business competitiveness (Martin& Moldoveanu, 2003; Ulrich, 1997) andwhen numerous studies have demonstratedthe relationship between HR practices andbusiness performance (Bennett & Bell, 2004;Huselid, 1995; Wright, Gardner, & Moyni-han, 2003). To add value to business com-petitiveness, it has been argued that HRfunctions need to realign their resources andactivities for higher value-added contribu-

tion (Ulrich, 1997; Yeung & Brockbank,1995; Yeung, Brockbank, & Ulrich, 1994). HRpractices also must be designed to meet notonly short-term operational pressures, butalso long-term strategic needs (Ulrich &Brockbank, 2005; Ulrich, Brockbank, &Yeung, 1990). Finally, HR professionals mustbe more results-oriented and well-balancedto assume the roles of business partners (Ul-rich, Brockbank, Yeung, & Lake, 1995;Yeung, Woolcock, & Sullivan, 1996). As firmsin Asia are undergoing rapid growth and un-dertaking aggressive global aspirations(Yeung, 2004), we believe that the expecta-tions of HR functions to take a more strategicand proactive role are greater than ever.

The challenges of talent management areparticularly severe in developing and transi-tional economies, where demand for high-cal-iber talent far exceeds supply due to bothrapid economic growth and limited talent in-ventory in place. China is a critical case inpoint vis á vis this challenge (Goodall, Warner,& Lang, 2004). A recent McKinsey study esti-mates that in the next 10–15 years, China will


FIGURE 1. Overlapping Characteristics of HRM Systems Among Developed, Developing, and TransitionalEconomies

GROUP1

GROUP GROUP

2 3


need approximately 75,000 globally compe-tent managers to meet its business require-ments (Farrell & Grant, 2005). Yet, the realityis that China currently only has about 3,000to 5,000 such high-caliber managers. Thestudy also points out that due to the discon-nection between the Chinese educational sys-tem and corporate talent requirements, onlyone out of ten university graduates in Chinais prepared to work for MNCs with the re-quired language skills, computer skills, etc.The war for talent clearly is “white-hot” asboth MNCs and local firms compete for a very

limited talent pool in those coun-tries. We predict that such a talentshortage will not be solved in thenext decade due to the lack ofequilibrium between talent de-mand and supply.

In addition to the shortage intalent with the required skills,knowledge, and experience, cor-porations in Asia face the addi-tional challenges of changing em-ployee mind-sets and mentalityto be more performance-driven(rather than egalitarian-oriented),customer-focused (rather thanfollowing rules), and to cultivatea stronger sense of integrity(rather than taking advantage ofgray areas or unethical behaviorsfor short-term gains). The legacy

of traditional politico-economic systems, es-pecially in economies transitioning fromplanned economy to market economy, isthat employees are used to working in envi-ronments where enterprises are supposed totake care of employees no matter whethergood or bad, where employees are socializedto play safe and comply with rules, andwhere getting things done through “infor-mal” channels (or back doors) and “special”relationships such as guanxi are acceptednorms to compete for scarce resources andopportunities. Clearly, such norms and be-haviors can prove to be counterproductive tobusiness imperatives to build the transpar-ent, performance-driven, and customer-ori-ented culture that is increasingly critical forsuccess in a global business environment. As

a matter of fact, the challenges of instillingthe proper mind-set and behaviors consis-tent with global business standards andcodes of conduct are not only difficult forlocal employees in many transitionaleconomies, but also for international expa-triates who are pressured to deliver businessresults in those markets. Recent news reportsin China regarding the bribery behaviors ofsome senior executives in MNCs like Lucent,Siemens, Carrefour, and others testify to theseriousness of such problems.

As firms in Asia continue to grow inboth size and complexity, we believe thatcritical HR issues like attracting and retain-ing key talent, developing a talent pipeline,and creating a high-performing culture can-not be ignored and must eventually capturethe attention of senior business leaders bychoice or by crisis. HR professionals haveno choice but to transform HR activitiesfrom administrative and operational orien-tations to business and strategic focus, orface the risks of being replaced or out-sourced. The drive and desire to upgradethe HR function and professionalism can beeasily felt in China nowadays. When con-ducting workshops for senior executives inChina, it is almost certain that some CEOswill come to us during breaks, asking for as-sistance either to identify more qualifiedHR leaders for their firms or to refer someexperienced consulting firms to reengineertheir HR processes and practices to supportgrowth and transformation.

The combined forces of growth and glob-alization have great momentum for changesin HRM in Asia at both country and corpo-rate levels. Critical HR challenges must beaddressed by companies to sustain theirgrowth and global competitiveness, espe-cially in markets where high-caliber talentsare hard to source and where employeemind-sets and values need to be realigneddue to a legacy of traditional politico-eco-nomic systems. However, as firms in Asia de-velop and strengthen their HR systems andcapabilities to meet new business challenges,we believe that they must sort through whatHR practices can be readily transferred fromthe West and what HR practices must be

The combined

forces of growth

and globalization

have great

momentum for

changes in HRM in

Asia at both country

and corporate

levels.



grounded in their national cultures. We pre-dict “bounded” convergence will prevail, notglobal convergence in the literal sense.

Coverage and Contribution of Articles in This Special Issue

This Special Issue consists of a collection ofeight contributing articles that help us un-derstand the key HR issues faced by corpora-tions in Asia, the contribution of HRM tobusiness success, and the evolution of HRMin transitional economies like Vietnam. Interms of geographical coverage, due to theeconomic prowess of China in East andSoutheast Asia, the majority of articles (fiveout of eight articles) study HRM in China,one focuses on Vietnam, another conducts acomparative study between Korean and Chi-nese executives, and one covers Asia in gen-eral. In terms of research focus, there are fourarticles devoted to the examination of spe-cific HR issues (for example, the relative im-

portance of employee-organization relation-ship versus supervisor support in creatingtrust, the importance of employment securityversus career development in employee out-comes, the race and gender bias in expatriateassignments, and organizational resilience inthe face of crises and terrorism) that are criti-cal to business growth and globalization inthe region. Two articles assess the impact ofstrategic HRM and operational HRM in orga-nizational performance in China, and one ar-ticle reviews the evolution of research focusregarding HRM in China in the last twodecades. There is another article that com-pares and contrasts the effects of ownershipstructure on HRM in Vietnam. Table I sum-marizes the foci and methodologies used inthese articles. We briefly highlight the keycontributions of how these articles contributeto our knowledge about HRM in Asia.

Extending her stream of research on em-ployee-organization relationship (EOR), AnneTsui and associates examine how employee


Author Themes Country(s) Covered Basis/Methods

Zhang et al. Strategic HR issue: Trust China

Gong and Song China

Tung China, South Korea

Liou and Lin Asia-Pacific

Ngo et al. China

Akhtar et al. China

C. J. Zhu et al. Research area growth China Literature review182 articles

Y. Zhu et al. Vietnam 32 case studiesHRM in transitional economies:The effect of ownership typeson HRM structure

465 firms2 surveys: general managers +HR directors

Effects of SHRM and HRM practices on performance

600 firms4 regionsSurvey + interviews

Effects of SHRM and main-stream HRM on performance,employee relations climate

System dynamicsHRM resilience in face of terrorand crises HR planning

EMBA studentsCross-cultural HRM: Race and gender bias in expatriate assignment

478 firmsEmployment security vs. careerdevelopment

545 middle managers8 cities

T A B L E I Themes, Coverage, and Methodology of Contributing Articles in This Special Issue


trust may be created in China in the article“How Do I Trust Thee? The Employee-Organi-zation Relationship, Supervisory Support andMiddle Manager Trust in the Organization.”Based on a sample of 545 Chinese middlemanagers in eight cities in China, this articleassesses the relative impact of the formal EORversus informal supervisory support in affect-ing employee trust toward organizations.They hypothesize that middle managers’ trustin the organization will be highest under amutual investment EOR approach comparedto a quasi-spot contract approach, that trust

will be highest when these man-agers perceive a high level of su-pervisory support, that this per-ceived supervisory support will domore to increase trust than the or-ganization’s mutual investmentEOR approach, and that supervi-sory support may modify both thepositive and negative aspects ofthe organization’s EOR approach.Their hypotheses are confirmed bythe data.

Gong and Chang, in their arti-cle “Institutional Antecedents andPerformance Consequences of Em-ployment Security and Career Ad-vancement Practices: Evidencefrom the People’s Republic ofChina,” examines the provision ofemployment security and careeradvancement in firms of diverseinstitutional ownership types andthe impact of such practices on

employee and firm outcomes. Based on a sam-ple of 478 state-owned and non-state-ownedfirms (i.e., domestic private firms, Sino-for-eign joint ventures, and wholly foreign-owned firms), the study found that the provi-sion of employment security was greater instate-owned than in non-state-owned firms.The provision of career advancement oppor-tunities in domestic private firms and Sino-foreign joint ventures was similar to that inwholly foreign-owned firms, but greater thanthat in state-owned firms. The provision of ca-reer advancement opportunities was posi-tively related to employee organizationalcommitment, citizenship behaviors, and firm

performance. The provision of employmentsecurity was positively related to employee or-ganizational commitment, but not citizen-ship behaviors or firm performance.

The study makes two important contribu-tions to the HRM in Asia area. First, it high-lights the institutional context of change andoffers an institutional theoretical explanationfor the provision of employment security andinternal career mobility. Ongoing discussionabout security and mobility has seldomtouched upon the role of the institutional con-text. The study also reveals institutional inertiain state-owned firms. This study also offersnew evidence that enriches the debate aboutsecurity versus mobility. Overall, it seems thatthe mobility model (operationalized as inter-nal career advancement) is more effective thanthe security model (operationalized as the pro-vision of employment security) in terms of HRand firm performance outcomes in China. Thereduction of employment security, however,was not without cost in that it may lead tolower employee commitment to the organiza-tion. Because external mobility reduces loyaltyand increases turnover, it is useful to considerinternal mobility as an important componentof the mobility model in the debate.

In her article “Do Race and Gender Mat-ter in International Assignments to/from AsiaPacific? An Exploratory Study of AttitudesAmong Chinese and Korean Executives,”Rosalie Tung examines race and gender biasesin international assignment to and from AsiaPacific, an important topic as firms in Asia arefurther integrated into the global economy.Based on a survey of EMBA students in Chinaand South Korea, the article examines howtwo sensitive but potentially salient criteria,race and gender, might affect the selection ofan executive to head the (a) foreign opera-tions of a U.S. multinational in China andSouth Korea and (b) newly acquired U.S. op-erations of a Korean multinational. The find-ings reveal a fairly complex picture of howgender, race, and the interplay of these twofactors may affect these decisions. She findsthe following: First, in the Korean sample,competencies mattered more than race andgender in a senior executive appointment tothe U.S. operations of Korean multinationals.

The provision of

career advancement

opportunities in

domestic private

firms and Sino-

foreign joint ventures

was similar to that in

wholly foreign-

owned firms, but

greater than that in

state-owned firms.



Second, in the Korean sample, race and gen-der outweighed competencies in assignmentsto Korea. Third, in the Chinese sample, com-petencies outweighed race and gender in asenior executive appointment in China.Fourth, Koreans had a more positive attitudetoward foreign-born Koreans than the Chi-nese toward foreign-born Chinese for seniorexecutive appointments. Implications for in-ternational HRM and diversity management,both theoretical and applied, are discussed.

In view of rising terrorism and crises inthe region, Liou and Lin’s article “Human Re-sources Planning on Terrorism and Crises Is-sues in the Asia Pacific Region: Cross-nationalChallenge, Reconsideration, and Propositionfrom Western Experiences” argues that therehas been renewed interest in emergency pre-vention policies in many organizationsaround the world, particularly since the Sep-tember 11th attacks (2001) and the bombingevents in Bali (2002, 2005). Looking at fre-quent crises in Southeast Asian countries cre-ated by natural and man-made disasters, in-cluding emerging threats to the region posedby Islamic fundamentalism and terrorism,this article undertakes a literature search andtargets the impact on public attitudes andmorale on organizations and HRM, and onorganizational resilience. Functional terror-ism preparedness requires changes in organi-zational thinking about external environ-mental threats. In order to achieve this goal,HR departments must redefine their role interms of crisis management, and then fourkey planning measures for insuring post-emergency operations should be observed.These planning measures includes important,yet still underfocused areas of managementand organizational responses to (1) planningelements for proactive alertness, (2) inven-tory dispatched ability, (3) evacuation andrecord preservation coupled with dissemina-tion to employees plus explicit employeetraining, and (4) cross-cultural managementagainst terrorists.

In the article “Strategic Human ResourceManagement, Firm Performance, and the Em-ployee Relations Climate in China,” Ngo et al.attempt to extend HR-performance research inthe context of China. Their study differs from

previous research work in that it investigateswhether SHRM and mainstream HR practicesare related to different firm outcomes, includ-ing financial performance, operational per-formance, and the underresearched employeerelations climate. They also test whether theabove relationships are moderated by the dif-ferent types of firm ownership, which arecharacteristic of emerging economies.

The authors used a sample of 600 Chinesefirms from four regions and in various indus-tries. Two informants from each firm were in-vited to participate in the survey throughface-to-face interviews. Empiricalresults showed that the levels ofadoption of strategic human re-source management (SHRM) andmainstream HR practices werelower in state-owned enterprises(SOEs) than in foreign-investedenterprises (FIEs) and private-owned enterprises (POEs). BothSHRM and mainstream HR prac-tices were found to have directand positive effects on financialperformance, operational per-formance, and the employee rela-tions climate. Moreover, the ef-fects of mainstream HR practiceson financial performance are rela-tively weaker for FIEs and POEsthan SOEs. Managers of thesefirms should be aware that the increased useof mainstream HR practices may not bringabout a significant improvement in financialperformance as seen in SOEs. Arguably, SOEscan reap more benefits by designing betterHRM systems, as they lag behind other firmsin this regard. Mainstream HR practices areable to boost the incentives and motivation oftheir employees, which in turn leads to higherfinancial performance in SOEs.

The authors also found that firms usingmore SHRM benefit in terms of organiza-tional performance, regardless of ownershiptype. In view of this result, CEOs and HRmanagers of all types of firms in Chinashould feel confident in implementing SHRMand seeing improved organizational perform-ance. They should devote time and energy tostrategically developing and monitoring

Mainstream HR

practices are able to

boost the incentives

and motivation of

their employees,

which in turn leads

to higher financial

performance in

SOEs.



HRM processes within their firms. Lastly, thisstudy indicates that the use of SHRM andmainstream HR practices contributes to thedevelopment of a positive employee relationsclimate, which is critical for Chinese firmsthat emphasize workers’ involvement and co-operation. Since organizational climate mayprovide a source of sustainable competitiveadvantage for firms, HR managers should paymore attention to managing the employee re-lations climate in their firms.

Along a similar line of thought, theAkhtar et al. study, “StrategicHRM Practices and Their Impacton Company Performance in Chi-nese Enterprises,” examines thevalidity of strategic HRM practicesand their effects on company per-formance in a sample of 465 Chi-nese enterprises including SOEs,publicly listed firms (PLFs), andFIEs. Data were collected throughtwo questionnaire surveys amonggeneral managers and HR direc-tors of the sample companies. Thegeneral managers responded to aquestionnaire on financial andproduct/service performance oftheir companies. The HR directorsprovided information on a rangeof SHRM practices relating to in-ternal career opportunities, formaltraining systems, results-orientedappraisals, employment security,participation, job descriptions,and profit sharing. Their results

show that core SHRM practices (training, par-ticipation, result-oriented appraisals, and in-ternal career opportunities) affect both prod-uct/service performance and financialperformance. Employment security and jobdescriptions contributed uniquely to prod-uct/service performance, whereas profit shar-ing contributed uniquely to financial per-formance.

Cherrie Jiuhua Zhu et al.’s “A Retrospec-tive and Prospective Analysis of HRM Re-search in Chinese Firms: Implications andDirections for Future Study” is based on anextensive review and analysis of 182 articlespublished in the field of HRM, focusing on

China since its economic reform. They dis-cuss the major reasons for the growth in thisarea of research and identify five major cat-egories spanning research and practice,ownership type, and research method. Fur-ther, they examine issues and deficiencies inthe research literature. Based on their analy-sis of each research category, they present asubstantial series of research questions andimplications for future research on HRM inChina.

Last but not least, Ying Zhu et al., in“New Forms of Ownership and Human Re-source Practices in Vietnam,” examine eco-nomic reform and its impact on enterpriseand HRM in one of the socialist transitionaleconomies in Asia-Vietnam. In 1986, theVietnamese government commenced themove from a centrally planned system to amarket-oriented economy with a multisec-toral economic structure and a multi-owner-ship system. This process, known as Doi Moi,had a major effect on the economic and so-cial fabric of Vietnam. This article exploresthis relationship between economic reformand enterprise management through de-tailed case studies of 32 enterprises coveringa wide range of ownership types. The find-ings reveal a diversity of HRM practices dueto the changing factors such as globalization,political and economic reforms, and enter-prise restructuring. Both theoretical discus-sion and empirical investigation lead to a sig-nificant conclusion about the formation andadoption of certain models of people man-agement in the socialist transitional econ-omy. The results show that the developmentof people management systems is an ongo-ing process of integration, recomposition,and revitalization under the influence of anumber of key factors, including politicaland economic changes, the relationship be-tween party-state and enterprises, and enter-prise management reform in a socialist tran-sitional economy such as Vietnam.

Conclusion

In short, these eight articles collectivelycover a wide range of HR issues, evolutionarytrends, and challenges in different parts of

Since organizational

climate may provide

a source of

sustainable

competitive

advantage for firms,

HR managers

should pay more

attention to

managing the

employee relations

climate in their firms.



Asia. Based on their findings as summarizedabove, several conclusions may be presented:

1. HR matters, as both studies by Ngo et al.and Akhtar et al. repeatedly demonstratethat HRM practices have an impact onorganizational and employee perform-ance in different types of ownership.Their findings are consistent with HR-performance studies conducted in otherparts of the world.

2. HRM is evolving in Asia, especially intransitional economies like China andVietnam. By assessing and categorizingthe HR research conducted in China,Cherrie Jiuhua Zhu et al. trace the evolv-ing focus of HRM studies over differentperiods of time. Likewise, Ying Zhu et al.examine how HRM systems evolve undermajor economic reforms in Vietnam.

3. Key HR issues such as building trust, em-ployee security versus mobility, organiza-tional resilience, and international assign-ments must be understood and effectivelyaddressed as firms in Asia continue to im-

prove their people-management practicesto support business growth and enhanceglobal competitiveness.

We believe the articles presented in thisSpecial Issue have captured a snapshot ofsome key issues and development regardingHRM in Asia. Clearly, more systematic stud-ies in this vital region are needed, and wewould invite researchers and practitioners tojoin us to further advance the understandingof HRM in Asia. Of particular interest arehow HRM systems in different groups ofAsian economies will evolve under the pow-erful forces of growth and globalization, andwhat Asian corporations should focus on, interms of HRM, to better prepare themselvesto capture such unprecedented opportunitiescreated by dramatic growth and globaliza-tion. Finally, we hope that you will enjoyreading these articles as indeed we did, gainnew insights from their studies, and build onthese to further our common professionalconcerns, no matter whether in academic orcorporate settings.


ARTHUR YEUNG is currently the associate dean and Philips Chair Professor of HumanResource Management at China Europe International Business School. Before his recentreturn to academia, Dr. Yeung served as corporate vice president and chief HR officer ofAcer Group-one of the top five PC companies worldwide. Reporting directly to the chair-man and CEO, he worked closely with the top management team to radically transformAcer to meet the challenges and opportunities of new business realities.

Dr. Yeung’s research interests focus on building organizational capability for strate-gic implementation, leading and facilitating organizational transformation, and strategichuman resource management. He has received research awards from two leadinghuman resource associations in the United States: the Yoder-Heneman Personnel Re-search Award presented by the Society of Human Resource Management (1989) and theBest Research Paper of the Year by the Human Resource Planning Society (1995). In 2002,he also received the Gold Book Award, jointly presented by the Ministry of Economic Af-fairs and the Chinese Management Association in Taiwan. Dr. Yeung served as associateeditor of Human Resource Management Journal from 1995 to 2006 and is currently edi-tor (Asia) for Human Resource Planning Journal and editorial advisory board member ofHarvard Business Review (China).

In addition to research and teaching, Dr. Yeung has also been involved in training andconsulting projects for numerous major corporations in Asia and North America andserves as an independent board member for two publicly listed companies in HongKong and Singapore. He also chairs the Asia-Pacific Regional Judge Panel for selecting“Best Employers in Asia” sponsored by Hewitt, the Wall Street Journal (Asia), and theFar Eastern Economic Review.



MALCOLM WARNER, MA, PhD (Cantab.), is currently a professor and fellow emeritus, Wolf-son College, and senior research associate, Judge Business School, both at the Universityof Cambridge. Following his undergraduate studies at Cambridge, he was a graduate fel-low at Stanford University, gained his doctorate from Cambridge, and was later a postdoc-toral ACLS fellow at Columbia University. After this, he taught and researched at the Lon-don Business School and Henley Management College/Brunel University, among otherinstitutions. He has also been Halevy Visiting Professor at the Institut d’Etudes Politiques deParis (Sciences Po’) and a frequent speaker at annual conferences on Asian management atINSEAD, Fontainebleau. He has additionally been an honorary visiting professor at CassBusiness School, City University, London. He has over the years given lectures and semi-nars at many business schools and universities worldwide and particularly in Asia Pacific,in China, Hong Kong, India, Japan, Thailand, and Vietnam, as well as in Australia.

His special interests are in the areas of Asian management, cross-cultural studies, organization behavior and human resources (http://www.jbs.cam.ac.uk/people/faculty/warnerm.html). He has published over 40 books and over 250 articles in journals, chapters,and other contributions. The latter include the Asia Pacific Journal of Management, ChinaQuarterly, Human Relations, Industrial Relations, the International Journal of Human Re-source Management, International Studies of Management and Organization, the Journalof Management Studies, the Journal of World Business, and Organization Studies, amongothers. He is the editor-in-chief of the International Encyclopedia of Business and Manage-ment (eight volumes) and co-editor of the Asia Pacific Business Review. He is also on theeditorial boards of a number of international journals.

CHRIS ROWLEY, BA, MA (Warwick), DPhil (Nuffield College, Oxford), is a subject groupleader and the inaugural professor of human resource management at Cass BusinessSchool, City University. He is the founding director of the new, multidisciplinary and inter-nationally networked Center for Research on Asian Management, editor of the leadingjournal Asia Pacific Business Review, and founding book series editor of Studies in AsiaPacific Business and Asian Studies: Contemporary Issues and Trends. He is well known andhighly regarded in the area, with visiting appointments at leading Asian universities andpositions on top journal editorial boards in the United States and United Kingdom. He hasgiven a range of talks and lectures to universities and companies internationally with re-search and consultancy experience with unions, business, and government, and his previ-ous employment includes varied work in both the public and private sectors.

Professor Rowley researches in a range of areas, including international and com-parative human resource management and Asia Pacific management and business. Re-cently he was awarded research grants from the British Academy, an ESRC AIM Interna-tional Study Fellowship, and a five-year RCUK Fellowship to study various managementissues in Asia. He acts as a reviewer for many funding bodies, including the ESRC, BritishAcademy, and Leverhulme, as well as for numerous journals and publishers.

Professor Rowley publishes very widely, including in leading U.S. and U.K. jour-nals, such as California Management Review, the Journal of World Business, and the International Journal of HRM, among many others, with over 100 articles, 80 bookchapters, and other contributions and 20 edited and sole authored books(www.cass.city.ac.uk/research/faculty.nsf/c.rowley). He also regularly wrote for theFinancial Times’s series “Mastering Management Online.”

REFERENCES

Amsden, A. (1989). Asia’s next giant: South Korea andlate industrialization. New York: Oxford UniversityPress.

Bennett, M., & Bell, A. (2004). Leadership talent inAsia: How the best employers deliver extraordi-nary performance. Singapore: Wiley.

Bjorkman, I., & Lu, Y (2001). Institutionalization and bar-gaining power explanations of HRM Practices in in-


ternational joint ventures: The case of Chinese-West-ern joint ventures. Organization Studies, 22, 491–512.

DiMaggio, P. J., & W. Powell, W. (1983). The iron cagerevisited institutional isomorphism and collectiverationality in organizational fields. American Socio-logical Review, 48, 147–160.

Dore, R. (1987). Taking Japan seriously: A Confucianperspective on leading economic issues. London:Athlone Press.

Economic and financial indicators. (2007, September29). The Economist.

Farrell, D., & Grant, A. (2005). China’s looming talentshortage. The McKinsey Quarterly, 4, 70.

Goodall, K., Warner, M., & Lang, V. (2004). HRD in thePeople’s Republic: The MBA with Chinese charac-teristics? Journal of World Business, 39, 311–323.

Huselid, M. A. (1995). The impact of human resourcemanagement practices on turnover, productivity,and corporate financial performance. Academy ofManagement Journal, 38, 635–647.

International Monetary Fund (IMF). (2007). Globaliza-tion of labor. In World economic outlook:Spillovers and cycles in the global economy (Chap-ter 5). Washington, DC: Author.

Johnson, C. (1982). MITI and the Japanese miracle.Stanford, CA: Stanford University Press.

Martin, R., & Moldoveanu, M. (2003, July). Capital vs.talent: The battle that’s reshaping business. Har-vard Business Review, pp. 1–7.

Rowley, C. (2007, October 15). Employment strategyand policy in the Asian region (in Korean). Interna-tional Labor Brief.

Rowley, C., & Benson, J. (2002). Changes in AsianHRM. Asia Pacific Business Review, 9, 1–14.

Rowley, C., & Benson, J. (Eds.). (2004). The manage-ment of human resources in the Asia Pacific re-gion: Convergence reconsidered. London: FrankCass.

Ulrich, D. (1997). Human resource champions. Boston:Harvard Business School Press.

Ulrich, D., & Brockbank, W. (2005). The HR valueproposition. Boston: Harvard Business SchoolPress.

Ulrich, D., Brockbank, W., & Yeung, A. (1990). Beyondbelief: A benchmark for human resource manage-ment. Human Resource Management, 28, 311–335.

Ulrich, D., Brockbank, W., Yeung, A., & Lake, D. (1995).

Human resource competencies: An empirical as-sessment. Human Resource Management, 34,473–495.

Vogel, E. (1991). The four little dragons: The spread ofindustrialization in East Asia. Cambridge. MA: Har-vard University Press.

Wade, R. (1990). Governing the economy. Princeton,NJ: Princeton University Press.

Warner, M. (2002). Globalization, labor markets andhuman resources in Asia-Pacific economies: Anoverview. International Journal of Human Re-source Management, 13, 384–398.

Warner, M., Edwards, V., Polansky, G., Pucko, D., &Zhu, Y. (2005). Management in transitionaleconomies: From the Berlin wall to the Great Wallof China. London and New York: Routledge-Curzon.

Wright, P., Gardner, T. M., & Moynihan, L. M. (2003).The impact of HR practices on the performance ofbusiness units. Human Resource ManagementJournal, 13, 21–36.

Yeung, A. (2004). HR as business partners: Strategiesand styles in Chinese business context. In D. Ul-rich, M. Losey, & S. Meisinger (Eds.), The future ofHR: 50 thought leaders call for change (pp.400–407). New York: Wiley.

Yeung, A. (2006). Setting people up for success—Howthe Portman Ritz-Carlton Hotel gets the best fromits people. Human Resource Management Journal,45, 267–275.

Yeung, A., & Brockbank, W. (1995). Reengineering HRthrough information technology. Human ResourcePlanning Journal, 18, 24–37.

Yeung, A., Brockbank, B., & Ulrich, D. (1994). Lowercost, higher value: HR function in transformation.Human Resource Planning Journal, 17, 1–16.

Yeung, A., Woolcock, P., & Sullivan, J. (1996). Identify-ing and developing HR competencies for the fu-ture: Keys to sustaining the transformation of HRfunctions. Human Resource Planning Journal, 19,46–58.

Zhu, Y., Rowley, C., & Warner, M. (2007). Human re-source management with Asian characteristics: Ahybrid people management system in East Asia.International Journal of Human Resource Manage-ment, 18, 44–67.

Zhu, Y., & Warner, M. (2004). Changing patterns ofhuman resource management in contemporaryChina. Industrial Relations Journal, 35, 311–328.


Documents

City Research Onlineopenaccess.city.ac.uk/18006/1/Yeung_et_al-2008-Human_Resource... · How will HRM systems in these ... global integration? What challenges, issues, ... globalization