China is one of the toughest and most competitive marketplaces in the world and has an unprecedented talent gap. If businesses here are to plug the gap and build the capability to sustain profitable growth, they need to develop a coaching culture. The talent gap is unique because, apart from the dramatic expansion of the economy, there is a missing generation of experienced Chinese managers a legacy of the Cultural Revolution. Ex-pats are being replaced by young, bright and achievement-oriented Chinese Mainlanders who may be short on business experience and the skills to develop their staff. One of the problems is that while Chinese graduates from the best universities have great potential, parallel with that of graduates elsewhere, the learning style is not conducive to the creativity and adaptability required by highly competitive modern businesses.
The educational system is influenced by Confucian tradition and a ‘learn-by-rote’ teaching style. This is changing, but Chinese undergraduates don’t have access to the latest thinking in business disciplines such as marketing, HR or supply chain management. Chinese universities need to be more focused on producing welltrained, business-oriented people.
The real challenge for businesses in China is to invest and develop their Chinese managers by building deep professional skills, and coaching them on how to lead and motivate their people. During the five years I spent in Shanghai as Unilever’s senior vice president and HR director, I developed a range of coaching programmes for board members and middle managers to help them coach their teams and accelerate learning and development. One of the key steps was to develop self-awareness among Chinese leaders.
Using web-based questionnaires, psychometric tests and feedback from subordinates, participants received relevant and specific feedback on their leadership styles and the environment they were creating for their staff. Managers discovered that their predominant leadership style tended towards command and control and that it was having a negative effect. This realisation encouraged them to develop other styles of leadership and learn how to deploy them to match a range of business situations.
It was not always easy for managers to manage in a coaching style but most found that their staff responded enthusiastically. For managers it meant listening more and being supportive rather than directive. Staff had to get used to seeing their bosses as sounding boards, taking responsibility for their decisions and learning from their failures as well as their successes.If anything, the talent gap in China is widening.
The command and control mindset has served China well in building the ‘hardware’ for an impressive economic infrastructure for basic manufacturing. However, China’s politicians are now signalling that becoming the ‘world’s factory’ is not a sustainable long-term strategy. Incentives have been introduced this year aimed at boosting homegrown R&D and high-tech sectors. The ‘software’ capability in terms of leadership competency could be the limiting factor in achieving this aspiration. Anyone doubting this should reflect on the experience of staying in one of the newly built local hotels in China rich in state-of-the-art hardware but poor in terms of teamwork and customer orientation. Businesses in China need to pay attention to people management to stay ahead of the game.
David Learmond co-founded ChinaGateWays in 2005 and advises companies on doing business in China. He lived and worked in Shanghai for five years, where he was Unilever’s senior vice-president and HR director. He is also a qualified executive coach and is a partner in a UK-based executive coaching business, Better Business Coaching LLP.