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International Human Resource Management: China and North Asia

Scope of the Research:
This research group is conducting several projects that investigate the impact of Australian (Western) business practices on the performance of their subsidiaries across Asian markets and cultures.  This group can undertake research that will provide tangible business solutions to enhance the HRM practices and contribute to improved Australian-Asian relations between expatriate managers and local employees, managers and business partners.

Key Researchers:
Cherrie Zhu,
Kate Hutchings,
Helen De Cieri,

Project 1: The Changing Role of HRM in Transitional Economies: Evidence from China
China’s progressive integration into the global economy has strengthened its position as a ‘magnet’ for foreign direct investment. The inevitably increased competition in the Chinese economy has led firms to adopt more market-oriented approaches to human resource management (HRM). Based on a survey conducted in 2005 of 813 respondents (mainly HR personnel) in industrial firms in China, this project examines the impact of vertical integration of the human resource function, measured by the strategic integration and devolution of HRM practices, on the performance of industrial firms in China. The results of this preliminary research found some evidence for a positive relationship between the degree of strategic integration of HRM with business strategies and firm performance. Although more analyses need to be conducted on the data collected by this study, our findings provide some signals that the HR function is emerging as a strategic player in Chinese enterprises.

Zhu, C.J., Cooper, B. & De Cieri, H. 2006. The changing role of HRM in transitional economies: evidence from ChinaInteractive paper presented at the Academy of International Business Annual Conference, Beijing China, June 23-26.

Project researchers: Cherrie Zhu, Helen De Cieri, Brian Cooper,
and Shuming Zhao School of Business, Nanjing University

Project 2: Enhancing Knowledge Sharing in Multinational Corporations in China
The research examines the specific features of knowledge sharing in Western WOFEs and JVs in China and the cultural and institutional issues that determine the willingness or reticence of individuals to share knowledge within the organisations.   Contrary to earlier research suggesting that people in transition economies such as China have a propensity not to share knowledge, this research suggests that employees and managers in China may in fact be more inclined to share knowledge than people in Western, industrialised countries but that this willingness to share knowledge is highly influenced by group membership. The research suggest that vertical collectivism and particularistic social relations in China lead to intensive social relations among organisational members, which facilitate knowledge sharing between in-group members in organisations. Moreover, differences in the essence of collectivism as well as in the extent of collectivism lead to different intensities of knowledge sharing in Chinese organisations.

Hutchings, K. 2005. “Examining the impacts of institutional change on knowledge sharing and management learning in China: Some challenges for international managers”, Thunderbird International Business Review, 47(4): 447-468.

Michailova, S. and Hutchings, K. 2006. “National Cultural Influences on Knowledge Sharing in China and Russia”, Journal of Management Studies, 43(3): 383-405.

Hutchings, K. and Michailova, S. 2006.  “Impacts of Culture and Institutions on Knowledge Sharing in Russia and China”, International Journal of Emerging Markets, 1(1): 21-34.

Hutchings, K. and Michailova, S. 2004. “Facilitating knowledge sharing in Russian and Chinese subsidiaries: The role of personal networks”, Journal of Knowledge Management, 8(2):84-94.

Project researcher: Kate Hutchings

Project 3: Retrospective and prospective analysis of HRM research in China: Implications for further study
Based on an extensive literature review of research conducted in the field of human resource management (HRM) in China since its economic reform, the researchers have prepared a paper that highlights the background to the research; classifies the research papers in terms of HRM area, ownership types, and research methods; and examines issues and deficiencies in current research. The paper concludes with propositions and implications for future research on HRM in China.

Zhu, C.J., Thomson, B. & De Cieri, H. 2006. Retrospective and prospective look on HRM research in China: Implications for future study. Paper presented at the International Association for Chinese Management Research Conference, Nanjing China, June 15-18.

Project researchers: Cherrie Zhu, S. Bruce Thomson and Helen De Cieri

Project 4: Differences between Planned, Implemented and Perceived HR Practices and their Implications for SHRM: Empirical Test in MNCs Operating in China
We are conducting interviews and surveys in the Chinese subsidiaries of 6 to 8 multinational corporations. We will identify and examine gaps between planned, implemented and perceived human resource (HR) practices, from the perspectives of senior executives, managers, and employees. Further, we will examine links between these HR practices and firm performance. In addition to contributing to conceptual understanding of the implications of HR practices, the innovative research design will address recent calls to overcome deficiencies in extant research in this field through improved methodological rigour. The project also builds upon our ongoing research on HR management in China.

Project researchers: Cherrie Zhu and Helen De Cieri

Project 5: Outward FDI by Chinese Multinational Enterprises: Implications for International Human Resource Management
The topic of outward foreign direct investment (OFDI) from developing countries has generated a stream of international business research since the late 1970s.  There is increasing awareness of the significant, emerging phenomenon of Chinese OFDI.  Over the last decade, Chinese multinational enterprises (MNEs) have made a huge amount of OFDI, and a typical example is a recent $2.92 billion investment of the Aluminium Corp of China in the Aurukun project in Australia. China is now one of the world’s leading foreign investors. There is an emerging literature which examines the HRM implications of FDI in Chinese enterprises, yet most of this focuses on inward FDI from foreign investors. Recent evidence suggests that growth and developments in Chinese outward FDI create unexplored challenges for Chinese MNEs. The focus of this research is on the HRM implications which would follow a significant development of OFDI from Chinese enterprises looking to establish subsidiaries in other countries. The emergence of Chinese MNEs as globally competitive players presents both challenges and opportunities for Chinese managers, other transnational firms, and for the international business researchers who seek to study these firms.

De Cieri, H. .2006. (Panel Chair) Outward FDI by Chinese multinationals: Implications for international human resource management. Panel presentation at the Academy of International Business Annual Conference, Beijing China, June 23-26.

Zhu, C.J., Thomson, B., De Cieri, H. & Dowling, P.J. 2006. Outward FDI by Chinese MNEs: Developments, progress and emerging HRM issues. Paper presented in Panel session at the Academy of International Business Annual Conference, Beijing China, June 23-26.

Project researchers:
Peter Dowling, University of Canberra,
Cherrie Zhu and Helen De Cieri,
and Shuming Zhao, Nanjing University

Project 6: International HRM in the Asia Pacific Region
A research workshop involving leading IHRM researchers led to the publication of a special issue of the leading IHRM academic journal:
Helen De Cieri, Kate Hutchings & Peter Dowling (U. of Canberra), guest editors for special issue of The International Journal of Human Resource Management, 16 (4) 2005.

De Cieri, H., Hutchings, K., & Dowling, P. 2005. [Guest Editor’s Introduction] Editorial Note: International human resource management – an Asia-Pacific focus. International Journal of Human Resource Management, 16(4):471-474.

Hutchings, K. 2005. Koalas in the land of the pandas: Reviewing Australian expatriates’ China preparation. International Journal of Human Resource Management, 16(4): 553-566.

De Cieri, H., Fenwick, M., & Hutchings, K. 2005. The challenge of international human resource management: Reconciling strategic academic approaches with practical complexity. International Journal of Human Resource Management, 16(4): 584-598.

Project 7: Social Security Reform and HRM: Empirical Evidence from China
Developing country expenditure on social security has failed to keep pace with economic growth in recent decades. This failing has challenged classical development theory which had assumed the extension of coverage was an automatic part of the growth process. Motivated by the fact that this has often not occurred even in nations with very high growth rates, the International Labour Organisation (ILO) in 2003 formally launched a Global Campaign on Social Security and Coverage for All. As the title suggests, the ILO’s campaign aims to extend social security coverage to all people presently without this form of protection. China’s government has actively participated in this effort by launching a market-oriented social security system reform in the 1990s and accepted that the development of the new system is a key element in the nation’s transition to a market economy and its further integration into the global economy.

Utilizing a unique survey data base gathered by the China Mainland Marketing Research firm in 2004, on 5,010 urban residents from 31 cities, the project aims to examine coverage of social security and its impact on HRM. The researchers analyze the survey data to ascertain how the reform has affected the security of those living in urban areas and discuss the impact of this reform on the management of workforce in terms of labour mobility, staffing, incentives and employment relations and draw implications of this study for international business.

Project researchers: Chris Nyland, Cherrie Zhu, and Brian Cooper

Project 8: Intercultural Networking in China and the Arab World
Many analyses of the increasingly “global” economy and of the changing patterns of information-use and data transmission are based on assumptions that current trends will continue and that the industrial and commercial hegemony of the West will persist strengthened by the new technologies of virtuality and will be open to all. However this is far from certain. In exploring two diverse regions the Arab World and China, in this research we examine the interrelationships between new technologies of the information age and traditional interpersonal connections and networking in these societies sharing remarkably similar cultural networking practices. We identify some of the cultural filtering mechanisms in the Arab World and China and examine the ways in which the concepts of Time, Space, Trust and Ownership are significant frames for analysing Arab and Chinese society in that they operate in ways that do not necessarily fit with Western pre-conceptions.

Hutchings, K. & Weir, D. 2006. Understanding Networking in China and the Arab World: Lessons for international managers. Journal of European Industrial Training, 30(4):272-290.

Hutchings, K. & Weir, D. 2006. Guanxi and Wasta: A comparative examination of the impact of internationalisation and modernisation on traditional ways of networking in China and the Arab World. Thunderbird International Business Review, 48(1): 141-156.

Weir, D. & Hutchings, K. 2005. Cultural embeddedness of knowledge sharing in China and the Arab World. Knowledge and Process Management, 12(2): 89-98.

Project researchers:
Kate Hutchings
& David Weir, Ceram, France

Project 9: Expatriate Managers vs. Chinese Managers vs. Local-hire Foreign Managers: A Comparison of Australian and German Organisations in China
Initial research has suggested that while some organisations are implementing training to assist local managers to assume staffing of their international operations, other organisations are favouring the use of locally recruited foreign managers. In each scenario the organisations are endeavouring to ensure the employment of managers who possess both sound cultural knowledge as well as experience with Western organisational practice. This research explores the rationale for Australian and German organisations’ choice of whether to use expatriate managers, Chinese managers or local-hire foreign managers in their subsidiary operations in China, and the relative costs and benefits of each for the management of their international subsidiaries. The research assesses whether organisations receive best performance in this foreign posting by utilising expatriate managers who have organisational knowledge, Chinese managers who have cultural knowledge, or local-hire foreign managers who have skills in both areas.

Project researchers:
Torsten Kuhlmann, Bayreuth University, Germany
& Kate Hutchings