Good managers in short supply in China

Foreign firms find they have to hire and groom fresh grads for top jobs

HONG KONG - A SHORTAGE of managerial talent in China is creating fierce competition among foreign companies for the country's best graduates, who are then groomed in-house for top jobs, executives say.

When Hong Kong manufacturer Esquel, which makes shirts in China for brands such as Polo Ralph Lauren, Nike and Marks & Spencer, began giving career talks at Qinghua University four years ago, only five students turned up.

'We believe the top universities are the only place to get good managerial talent. But it's difficult. Students want to work in high-tech or innovative companies, not a traditional business like manufacturing,' Mr Calvin Tsang, director of human resources at Guangdong Esquel Textiles Co, said.

He said one way to get in touch with bright students is to develop close contacts with academic staff by collaborating on research projects.

'Professors have a lot of influence over students and their career choice,' said Mr Tsang.

Even big names like Unilever and Procter & Gamble say hiring is a challenge.

Mr David Learmond, who spent five years as head of human resources at Unilever in China, once interviewed an MBA graduate from an Australian university.

He learnt that not only did she not speak English, she had never been to Australia: The degree had been obtained at a university in China via an interpreter.

'While some students from the top programmes are excellent, a lot of these degrees are just pieces of paper which don't give the students much,' he said.

Management consultants McKinsey & Co estimated in a study that of the 15.7 million graduates that China will produce from 2003 to 2008, only 1.2 million will be suitable for jobs at multinational companies.

Esquel has introduced mentoring programmes for fresh graduates and assigned them to outside projects so that they can learn different aspects of the business and improve their managerial skills.

This longer-term approach to recruitment has enabled the company to cut its staff turnover rate in China to 7 per cent from more than 50 per cent five years ago, said Mr Tsang.

German consumer products company Henkel sends some of its promising Chinese employees on overseas courses for up to a year but says this can work against the organisation.

'It helps them to do their job but it also makes them more of a target in the market,' said Mr Werner Krieger, Henkel's Asian head of human resources. 'But there's no way out. It's part of the game.'