By Jennifer Lawrence, Eric Dieny, and Owen Haacke
What do multinational companies operating in China look for when hiring top executives, and how do they develop those executives’ leadership expertise? Eric Dieny of DHR International and Jennifer Lawrence of Cambridge Corporate Training recently provided hiring insight to US-China Business Council (USCBC) members in Shanghai.
Hiring top executives in China
According to Dieny, companies evaluate four skill sets during the hiring process, but just one of these essential traits becomes the basis for a final decision. Companies seek candidates with a track record of getting things done, as demonstrated by meeting or exceeding key performance indicators (KPIs). Functional expertise is equally important, and finalists for senior roles must demonstrate skill in one or more operational areas. Thus, functional expertise is rarely the ultimate factor. Likewise, a successful record of managing compliance policies and issues is required, but typically not the distinguishing feature among highly capable candidates. Instead, outstanding capability in so-called “soft skills” most often becomes the deciding factor when companies choose between experienced managers.
Dieny explained the five soft skills in high demand for senior executives in China:
- Business Connectivity Managing a specific operating function to obtain business results;
- Leadership Developing a team with appropriate competencies and behavior;
- Innovative Challenging the status quo to improve functional capabilities;
- Communication Interacting with clear, concise, and transparent messages using the right intensity;
- Collaboration Leading and influencing within and across teams, respecting others, being inclusive.
Developing senior executives in China
“Why are these called ‘soft’ skills if they’re so hard?” Jennifer Lawrence asked.
She explained that business connectivity, leadership, innovation, communication, and collaboration are all critical for successful business interactions, and that successfully deploying these skills requires comfort and clarity with situations involving ambiguity, risk, and conflict. Because comfort levels vary greatly across cultures, managers must adjust their style of interaction to fit the prevailing norm. Making these adjustments requires intention and practice. In particular, executives seeking to develop their leadership skills benefit by incorporating three essential practices into their activities:
- Critical thinking Actively listening, reading the audience, and asking great questions;
- Opportunity seeking Hunting for new paths and directions, rather than “problem-solving;” and
- Inclusive involvement Perceiving information flows as abundant, rather than scarce, resources, distributing data, and inviting others to share ideas widely.
Lawrence said senior executives should model and encourage these behaviors through intentional daily practice. She noted that the benefits are wide-ranging and the cultural hallmarks of top-performing innovative organizations worldwide.
Developing local leadership
Session participants echoed the importance of seeking and developing executives who utilize these essential practices to spark innovation. As one corporate president explained, localization of talent in China is rapidly moving forward and his organization recently replaced 80 percent of their foreign senior management with local hires. USCBC members in attendance identified major issues in developing talent, including:
- Managing international business Participants agreed that it is a challenge to develop local management who can hire international contractors and staff, as well as local talent.
- Developing innovative mindsets Additionally, training local talent in essential soft skills is tough. As a vice president of HR noted, this is especially important for multinationals affected directly by the economic slowdown. Management must cultivate an open mind to proactively seek opportunities beyond its traditional business model. Seeking and training executives who can drive innovation – as well as deliver functional results – is increasingly important for multinationals in China.
- Refining communication skills Council members noted they are significantly reducing foreign management, and the main challenge with localization is enabling local management to effectively communicate with colleagues at American headquarters. Local hires tend to bring a different sense of “accepted ambiguity” to communication, and might not effectively convey a problem or solution to US headquarters, which can cause misunderstandings and lack of trust.
For example, Chinese people often show that they understand or note another person’s point of view by nodding. This gesture is commonly perceived by Americans as a sign of agreement, when in fact, for the Chinese it is most often a sign of acceptance, rather than agreement.This may cause surprises later when it becomes clear that there was no agreement.
Americans and Chinese need to be aware of these differences. Chinese people should recognize that when they nod, Americans will believe that they agree and commit; and Americans should be aware that when Chinese people nod, they might not be signaling agreement.Therefore agreement should be expressly confirmed.
Executives at the session agreed that keeping these soft skills in mind when hiring, and throughout the development process, leads to more effective, innovative outcomes for an organization.
Jennifer Lawrence is the president of Cambridge Corporate Training, a firm that provides advanced training and executive coaching for companies around the globe: www.cambridgecorporatetraining.com. She can be reached at [email protected]. Eric Dieny is partner in the Shanghai office of DHR International, a US-based global executive search firm. Find out more at www.dhrinternational.com. Owen Haacke is the chief representative of the Shanghai office of the US-China Business Council, a private, nonpartisan, nonprofit organization of roughly 220 American companies that do business with China.