How Culture-Sensitive Is HRM? A Comparative Analysis of Practice in Chinese and UK Companies

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How culture-sensitive is HRM?

A comparative analysis of
practice in Chinese and UK
companies
Mark Easterby-Smith , Danusia Malina & Lu Yuan
The Judge Institute , Cambridge, UK

Published online: 28 Jul 2006.
To cite this article: Mark Easterby-Smith , Danusia Malina & Lu Yuan (1995) How
culture-sensitive is HRM? A comparative analysis of practice in Chinese and UK
companies, The International Journal of Human Resource Management, 6:1, 31-59,
DOI: 10.1080/09585199500000002
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The International Journal of Human Resource Management 6:l February 1995
How culture-sensitive is HRM? A

comparative analysis of practice in
Chinese and UK companies
Mark Easterby-Smith, Danusia Malina and
Lu Yuan
Abstract
There has been some concern about the extent to which models and practices of HRM are capable of being transferred from one country to
another. This emerged in the late 1970s as concern that Japanese ideas
might be adopted uncritically by US companies, and during the 1980s as
concern that these ideas, after recycling within the US, might not be
totally appropriate for consumption in other parts of the world. Further
urgency is added to the question by the pressures on many organizations
to develop their businesses internationally, or globally - since this increasingly means they have to consider and establish HRM policies which can
span different national systems and cultures.
This paper considers the problem through a direct comparison of practices in matched Chinese and UK companies in order to establish where
variations occur both within and between countries. It is evident that there
are considerable variations in the form of HRM in different settings, but
also some surprising similarities. Thus, for example, there are more similarities in manpower planning systems between Chinese companies and
some of the UK companies than there are between all the UK companies.
In this case it can be concluded that these elements are not greatly affected
by national (and assumed cultural) differences. On the other hand, there is
a sharp difference between the UK and Chinese companies with regard to
pay and reward systems, but much consistency within each country. This
suggests that there may be deep-seated differences between the two countries with regard to attitudes towards rewards which will limit the transferability of HRM ideas in this area.
Keywords
HRM, China, culture, careers, appraisal, manpower planning
O Routledge 1995
Mark Easterby-Smith, Danusia Malinu and Lu Yuan
Introduction
The rise of human resource management in the U K and North
America, both as practice and theory, has been well documented
(Storey, 1989; Towers, 1992; Hendry and Pettigrew, 1992). In particular it has been noted that there can be a marked divergence between
normative theory and actual practice (Legge, 1989), or between
rhetoric and reality. This has resulted in a growing concern to understand H R M practice in different settings. Some studies have concentrated on looking at practices within companies in the same country
(Storey, 1992, 1994; Fox and Mcleay, 1992; Strauss, 1992; Warner,
1993), others have started to compare practices between different
countries, both within Western Europe (Brewster and Tyson, 1991;
Pieper, 1990; Thevenet, 1991; Bournois, 199l), and further afield
(Storey et al., 1990; Markoczy, 1993; Child and Markoczy, 1993).
It is evident from these studies that the primary concerns of H R M
practitioners in each country vary considerably. Thus, in the USA
there is a primary emphasis on the implementation of employment
legislation around issues of discrimination and equal opportunities, on
the development of flexible employment contracts and on efforts to
increase employee participation (Strauss, 1992). Concerns in the UK
have focused around the reduction in the power of trade unions and
the linkages of H R M with corporate strategy (Storey, 1992); and in
France, there is more emphasis on language tuition and on meeting
minimum levels of expenditure on training which have been established by national legislation (Bournois, 199I). In Japan the dominant
features are generally held to be high levels of employer/employee
commitment and a strong emphasis on training and development in
the workplace. But the recent study by Storey et ul. (1990) showed
that the generalization did not hold for the companies in their sample.
The distinctive features noted in their study were: efficient centralized
career planning and a very high level of formal qualifications among
managers.
This leads to a consideration of the relationship between culture
and HRM, which has been studied along two main routes: firstly,
according to whether it is possible to transfer models of management
from one national setting to another (Ouchi, 1981; Hofstede, 1987),
and more specifically whether there are cultural limitations to the
transfer of H R M practices from the USA to Western Europe (Guest,
1990; Thevenet, 1991). In this respect there is a marked difference
between the mainly US authors who tend to take a universalist view
(Globerman, 1986), and the majority of European authors who take a
culturally relativist view. Secondly, and this derives largely from the
European concern to achieve greater business integration, how to
establish HRM systems which will make it easier for 'Euromanagers'
to work effectively between, and across, national boundaries (Potel,
1993). Moreover, the increasing internationalization, and globalization, of business makes it more pressing than ever to understand how
to establish HRM procedures which can deal with considerable cultural and national differences. Underlying all of this is the question
about which elements of HRM are, or are not, culture-sensitive.
This paper addresses this question through reviewing the results of
a comparative survey of HRM practices in four Chinese and four UK
companies matched as far as possible by size, technology and industry. After explaining the methodology and providing some background information about the context of Chinese business, the central
part of the paper describes current practices in five main areas of
HRM in the Chinese and UK companies. An analysis is then made of
the similarities and differences observed, both within and between
each country, and of the extent to which these differences may be
attributed to cultural or other contextual factors.
Methodology
Recent authors (Storey et al., 1990; Hendry, 1991; Pennings, 1993)
argue for more direct comparisons of corporate practices between different countries because this enables procedures and processes to be
understood more clearly in relation to contextual factors. This lack of
direct comparisons is one of the major weaknesses of much of the earlier international research on human resource management. The current study attempts to avoid this problem by looking at matched
companies in both China and the UK, and generalizations are then
based on well-grounded data.
The reason for choosing a comparison between China and the UK
(apart from the obvious commercial benefits likely to be derived from
better mutual understanding) was that there are marked cultural and
institutional differences between the two countries. In particular, in
China there is a stronger emphasis on relationships, group orientation, respect for age and hierarchy, and more significance is placed on
'face' than in 'Western' countries (Lockett, 1985). Moreover, China is
still fundamentally a centrally planned society despite the substantial
movements towards decentralization and the market economy which
have been set in train since 1979, and this is in marked contrast to the
UK in the early 1990s. These differences would therefore suggest that
Mark Easterby-Smith, Danusia Malina and Lu Yuan

elements of HRM would be quite different in China compared to the
U K and, where there are no apparent differences, this would need
explaining.
The companies chosen for investigation were also located in different industries, although the variation was relatively less since they were
all large and in process industries. The eight companies were, in pairs,
engaged in: metal processing, oil, chemicals and the manufacturing of
construction materials. For reasons of anonymity each company has
been given a pseudonym with two parts referring respectively to the
country and the industry. Thus Sino-Chem is the Chinese chemical
company and Brit-Con is the U K construction material company. An
unusual feature of the study was that it was reciprocal. It was designed
and conducted by Chinese and UK researchers working in teams (for
further discussion of methodological issues arising, see Malina and
Easterby-Smith, 1993). Not only were the UK researchers trying to
understand how things worked in the Chinese organizations, but the
Chinese researchers were also trying to make sense of the U K companies.
The bulk of data was obtained through interviews conducted
between January 1991 and March 1993 with a cross-section of managers in each company. Our overall strategy was to obtain general
descriptions of the official system from senior managers and personnel
people, supported by internal documentation and guidelines whenever
available, and then to check these out with case studies and specific
examples obtained from people on the receiving end of these systems.
Approximately four visits were made to each of the Chinese companies and more to the UK companies; most interviews were conducted
by at least two researchers, normally one from each of the Chinese
and U K teams. In addition, we were able to meet many of our informants off site, and we had a further week of discussions during the
course of a visit to the UK by fifteen senior managers from the
Chinese companies in July 1992. Approximately sixty hours of interviews were conducted with each of the Chinese companies and an
average of twenty-five hours with each of the UK companies. All formal interviews were tape-recorded with the exception of one of the
Chinese companies where permission was not granted. The English
tapes were transcribed directly by an audio-typist; the Chinese tapes
were translated and transcribed by Mandarin-speaking members of
the project team.
Summaries for each company were written up after each visit and
circulated for comment to the companies and informants concerned,
who were then able to correct matters of detail. The more general
interpretation of data was conducted by members of the project team
through a series of papers which were circulated and discussed with

other colleagues (including our Chinese partners). We should stress
that in the comparative analysis of the data, which is presented later
in this paper, we have tried not to equate national differences with
cultural differences. Culture is an extremely difficult concept to define,
and it is also generally accepted that it can vary considerably within
national borders. We have therefore been cautious in generalizing
from national differences to cultural determinants, except where there
has been additional external evidence to back up a given interpretation.
Background to HRM in China

Much of the literature on human resource management contains an
assumption that there is an 'ideal' model of HRM. This model
appears to contain elements that are drawn from practice in a number
of Western countries, and it generally includes: an integrated strategy
towards the development of human resources, the close involvement
of line managers, performance-related payment systems, high levels of
mutual commitment between employer and employee, agreements on
flexible working arrangements and reducing significance for the role of
trade unions (Storey, 1992; Guest, 1992b).
The problem with using 'ideal' models for comparative studies is
that they already presuppose national and, possibly, cultural characteristics. Hence the framework of HRM that is used in this study is
based on a more neutral 'functional' breakdown of activities into elements such as selection, manpower planning, appraisal, reward systems and management-union relations. Our focus is primarily on the
management levels because these are most interesting within the
Chinese context, being at the forefront of current reforms.
Early research into HRM within China was conducted around
training and development systems. This is because, since the start of
the economic reforms in 1979, training and development were seen
nationally as a key to the country's development. Hence provision
was organized nationally through compulsory training courses for all
top managers, the establishment of a national network of Cadre
Training Institutes and the development of postgraduate courses in
management within most of the country's leading universities
(Laaksonen, 1988; Warner, 1991). Since Western academics are closely
in touch with developments in this area we felt it less important to
investigate training and development than the other elements of HRM
mentioned above.
Mark Easterby-Smith, Danusia Malina and L L Yuan

~
A limited amount of academic research has already been carried

out on other aspects of H R M in Chinese companies. Notable among
such studies is the work of Warner (1986, 1993), Takahara (1992) and
Child (1994) on remuneration; Osigweh and Huo (1993) on relationships between employers and employees; and the broad overview of
H R M and management in China provided by Laaksonen (1988). A
concern of many of these studies has been the nature of government
policies and their implementation across a wide range of organizations. The present study attempts to complement these by looking in
some depth at the range of H R M provision within a small number of
organizations. It is also hoped that the direct comparisons between
the Chinese and UK companies will allow critical reflection on aspects
of H R M that are normally taken for granted within single country
studies.
Before presenting the data on H R M it seems important to comment briefly on some of the significant ways in which the general
Chinese industrial context differs from that of the UK. In addition to
the evident political and economic differences, there are also significant structural differences. Thus, although there is a rapidly growing
private sector in China, state enterprises still contribute nearly 50 per
cent of all industrial output and employ over 70 per cent of total
labour in urban areas. At present all public enterprises come under
the supervision of industrial ministries or bureaux which keep a tight
grip on internal decisions in relation to both business and human
resource matters. There is also a specialist Ministry of Labour and
Personnel (MoLP) which produces regulations to govern human
resource procedures for both workers (labour) and personnel (cadres).
In addition there is a dual power structure within every Chinese organization consisting of executive management and the Party. Each has
its own internal structure - for example, the Party has a separate
organization department which parallels the function of the personnel
department. Each also has an independent reporting relationship to
superior authorities outside the organization. Although the executive
system has formal responsibility for decision making, the Party is very
significant, and its influence has been somewhat reinforced since June
1989.
It should also be recognized that this is a period of rapid change in
Chinese HRM. There are two main sources for this: direct legislation
and guidelines issued about recruitment, remuneration, etc.; and the
knock-on effects of wider economic reforms which produce greater
internal competition, pressures to increase productivity and to lower
costs, especially labour costs. A number of changes have taken place
since our data were collected in 199112, although in most cases they

do not have a direct bearing on the issues discussed in this paper.
Nevertheless, it seems important to summarize the key legislative
changes at this point, and we will also indicate later on when such
changes are of relevance.
The most significant HRM changes stem from the Programme of
Enterprise Management Modernization which was launched in 1992.
This directs attention to the integrative management of human
resources, including: improvement of the labour contract system, the
establishment of databases in personnel management and the promotion of training and other management development programmes.
During 199213 the main stream of reform focused on the implementation of the Contractual Labour System (CLS) which directs that personal income, including wages and bonus, should be linked to growth
of profits. It further replaces the traditional lifelong employment
(Ruan Chongwu, 1992).
In addition to the adoption of CLS, two other reforms of the personnel and labour management systems are in progress. The first is the
establishment of social security and welfare systems, which are starting
to assume the social burden that used to be carried by enterprises. The
unemployment security system was initiated in 1986, and by the end of
1992 approximately 420 thousand enterprises and 71 million employees
had joined the system. Under this, enterprises pay between 0.6 and 1 per
cent of total wages to the state social security fund (People's Daily,
1994). The second is the creation of a labour market which mobilizes
human resources across enterprises and regional boundaries. It is however too early to judge the effect of this measure, although Child (1994)
suggests that so far its impact has been very limited.
HRM in Chinese and UK Companies: Results

In 1985 the Chinese Ministry of Labour and Personnel produced for
the guidance of enterprises a new national system in which all posts in
any enterprise or institution were graded. In large state enterprises the
full range was used and the grades for cadres ran from 1 down to 17,
whereas in a medium-sized enterprise the grades would run from 5
down to 17. For workers the scale ran in the other direction from 15
down to 1, with 1 being the lowest grade. This system was an adaptation of the old 8-grade system, and in the case of workers was now
seen to contain 8 main grades and 7 sub-grades in between. Although
enterprises are now free to determine their own arrangements, most
are still linked to the old system and this provides a common framework within which managerial careers can be planned.
Mark Easterby-Smith, Danusiu Malina and Lu Yuan

The manpower planning system is based on ratings of career potential for all managerial and professional staff conducted by specialist
units supervised by the enterprise Party organization. Lists are held
both by the Party and the enterprise director. The composition of
each list is reviewed and revised regularly by the organization department of the Party. Data on senior manager potential are collated by
the industrial ministry to which the company is responsible, and there
is a further, national, database which covers the presidents of larger
companies and senior officials in government. The ministry lists contain three divisions: (i) senior managers who could move immediately
into top executive or government positions; (ii) middle managers who
will be ready for these levels in the next two to ten years; and (iii)
junior managers termed 'Cross century - post 2000' who are seen as
future senior leaders. The main criteria said to be used in assessing
individuals are: loyalty to the Party, prospective or proven ability and
proven operational/specialist knowledge.
Most managerial careers evolve within the same function, with production experience being crucial for promotion to senior management
in all cases: cross-functional moves are rare. At senior levels managers
are occasionally moved between organizations that are under the aegis
of the same ministry, and at higher levels it is common for officials
who are subject to the national system to be moved between companies and a ministry. The Director of Sino-Chem explained the logic
behind the latter kind of move: 'Because it will benefit the government's understanding of enterprises'.
Our discussions with middle managers in the Chinese enterprises
confirmed that careers are still controlled by the system from the
moment of graduation (when the ministry assigns graduates to companies) to the time of retirement. Not only did their own careers seem
to have been controlled and planned for them, but they also said they
were content with this. With regard to current posts only one manager (from Sino-Met) had specifically requested the appointment that
he now held. Furthermore, there was much consistency in the descriptions of both the grading and potential rating system from all of the
Chinese companies, and we were also able to confirm the accuracy of
these accounts through subsequent meetings with ministry officials.
In all four British companies there were regular procedures for rating the potential of all professional and managerial employees, and
this information was fed into the process of succession planning. The
responsibility for assessing potential was vested in groups of senior
managers who would take responsibility for their functional or business area. This system was most fully developed in Brit-Chem where
committees, or working parties, of senior line managers were serviced
by personnel and HR specialists. The specialists were also responsible

for ensuring that criteria and procedures were applied with consistency in different parts of the company. Rating systems were very
similar to those used in China. Within Brit-Chem, where the system
has operated for over twenty years, there is a dual grading system
where individuals are allocated a letter corresponding to their
assumed career maximum (A being top management and E being
junior management), and a number indicating when they are likely to
reach that grade (1 is 'ready now', 2 is 'ready soon' and 3 is 'ready
later'). Thus an A3 would be someone of very high potential probably
in their mid-20s, a B2 would be someone likely to make senior management (under main board level) within the next three to five years
and probably aged 35-40 years. However, these working parties not
only made ratings of potential, they were also expected to monitor the
career paths of the individuals concerned and were closely involved in
the process of providing candidates to fill key vacancies. In all cases
the potential lists are seen as fluid and are regularly updated. In BritOil, for example, the potential ranking process takes place every two
years.
In Brit-Con the general list of potential was supplemented by a
'young talent' list. A senior manager described how this worked:
We run a young talent list for people who are specially worthy of watching
. . . though I hope we watch all people. So we identify a particular talent
under 30 and our objective with this list is that they are individually mentored
by the Chief Executive. In terms of their development we expect an MBA and
a language before they are 30.
In some instances the formal system in the UK companies was supplemented by informal procedures. For example, in one company
there were annual visits by top managers to each of the operating
units. These visits included a dinner to which bright young managers
were invited to sit with the visiting directors so that informal impressions could be built up. The following day the directors would review
the stock of high-potential youngsters with local management, and
would naturally be able to use their subjective impressions from the
dinner table to supplement more objective performance data.
The comparison between the Chinese and U K companies shows
similarity in the nature of the grading systems for management potential and the rigour with which they are pursued. In the UK, however,
these procedures are driven by line managers with personnel specialists in support, and they are often supplemented by informal sources
of information. In China the systems are run by specialist units under
the strong guiding influence of the Party, and there is little evidence to
suggest that formal data are supplemented in any way. (The precise
Mark Easterby-Smith, Danusiu Malinu and Lu Yuan
influence of the Party depends, as we shall see in the next section, on

local circumstances and the personal influence of the executive director in relation to the Party secretary.) In both countries the people
who make assessments of potential have considerable influence on
individual appointments and promotions.
Management appointments
Both executive and Party members have an influence on managerial
appointments in China, although there is still some confusion in the
respective roles and responsibilities of directors and Party secretaries.
The Director Responsibility System which was introduced in 1985
gave the final approval of all personnel management and labour
appointments to the director, after consultation with the Party secretary (Child, 1988) and the Enterprise Law of May 1988 strengthened
the authority of this post even further - defining the Party and Union
as supportive and complementary to the role of enterprise directors.
The events of 1989 have, however, changed this a little as indicated by
the following comment from a senior manager in Sino-Oil:
Before 1989 the decision was almost made by the general manager himself. But
now the consultancy of the Party secretary is necessary. The decision would be
reached jointly. But the final approval comes from the Party's standing committee.
We were given three examples of senior appointments in different

companies which show first the director and then the Party secretary
being dominant, with the third case being determined jointly by both
individuals. Thus in Sino-Oil the Party secretary was said to have
been more influential because he had had a major hand in appointing
the director in the first place. In Sino-Chem the director was dominant because he had an extremely strong personal network and was
highly regarded for his experience and business expertise. In the third
case the position of the Party secretary had been institutionalized into
the executive hierarchy by appointing him as vice director, and this
resulted in some equalization of influence. So it appears that in practice the relative influence varies according to a number of factors,
including the personal networks of the respective parties, their length
of service - and possibly the distance of the organization from Beijing
(the Party being weaker the further it is from Beijing).
In contrast to the diversity above, all companies reported in identical terms the criteria that were used to select managers for appointments. These were categorized into four principles: 'good moral
practice' (de), 'adequate competence' (neng), 'working hard' (qin) and
'excellent performance records' (ji). The first of these was seen to be
the most important, although it was often linked to two further criteria: political loyalty and harmonious relations with others. The latter
criterion was of particular importance in executive appointments
where the opinions of colleagues and current subordinates were
solicited by members of the personnel department about the candidate's suitability for the post. Indeed, for the top level of the company, where the posts came under the overall scrutiny of the ministry
there was a special evaluation unit within the ministry which had the
job of conducting surveys of the opinions of co-workers of all candidates before making a recommendation to the ministry personnel
committee. This element of 'democracy' was seen to be a vital element
in all personnel decisions, and can be linked to the strong cultural
emphasis placed on the maintenance of harmony and good relations
with others in China (Osigweh and Huo, 1993).
Until the early 1980s graduates and junior managers were all
assigned to companies by their respective ministries or bureaux. There
is still a major shortage of the former, and some companies have
entered into contracts with appropriate universities for the supply of
additional graduates in exchange for financial support. During the last
decade Sino-Met, for example, has 'bought' over 100 graduates at a
cost of about 10,000 yuan (approx. 800) each. The assignment of
other managers to companies was not popular because many of them,
such as retired army officers and political cadres, were allocated on
political merit and were not seen as being of much use by the company.
Companies are now exerting much more control over appointments
and it is becoming normal for vacancies to managerial posts to be
filled by candidates from inside the company, unless there is some
special expertise required which does not exist in the company at that
time. We encountered only one example of a senior outside appointment being made. This was the director of a new power station that
was being built by Sino-Met. Since the company had no past experience of electricity generation they head-hunted a senior manager who
was nearing retirement from the local electricity company to run the
plant for the first few years of its operation. Furthermore, the normal
career route is within and up the operational line: production experience is prized far more than functional experience in support areas
such as finance and marketing - but this is what one would expect at
the moment since the major problems within Chinese companies are
seen to be around productivity and quality. Only recently, with the
implementation of market-based industrial reforms, the introduction
of greater financial autonomy for companies and the realization of
overcapacity in some traditional industries such as heavy engineering,
Murk Eusterby-Smith, Danttsia Malina and Lu Yuan

has there been any appreciation that skills outside the production area
might be important in top management positions.
There is a growing use of examinations for appointments at junior
levels. Thus when Sino-Chem identified a total of 106 administrative
vacancies within the HQ in 1989 they designed a standard examination. This exam covered knowledge of enterprise management, competence in writing and relevant professional knowledge. Two-hundred
and forty applicants responded to the advertisement, and those who
passed the exam were then interviewed before a final selection was
made. The enterprise reforms of 1992 have further encouraged the use
of exams, but Warner (1994) reports on the basis of data collected in
mid-1993 that exams are still being used primarily at the level of technicians and assistant engineers, and not at the level of cadres.
Again we found considerable similarities between the UK and
Chinese companies in the area of appointments. All four of the UK
companies had explicit policies of growing their own talent from
inside, hence, as with the Chinese companies, external appointments
were relatively rare. Three companies (Chem, Oil and Con) all
recruited future managers from the graduate market (using the 'Milk
round' and other methods); Brit-Met preferred to recruit employees
direct from school and would then sponsor the more promising ones
through university. The particular advantage claimed for this system
is that, once appointed to management, these graduates very rarely
leave. There may be some justification to this claim since at Brit-Con,
which is, like Brit-Met, the dominant employer in its locality, graduate turnover had recently become uncomfortably high.
The procedures for making appointments to management posts
vary a little between the UK companies, with Brit-Chem being the
most elaborate, and Brit-Met being the least so. Taking the Brit-Chem
example first, there is a career development manager for each business
area who maintains 'vacancy running lists'. These specify both the
likely timescale in which certain posts will become available, and the
competencies required for each vacancy. This system of competencies
has been used for a number of years, and managers have become
accustomed to using 'competency' jargon when discussing performance; it is also evident that, as the needs of the business have
changed over the years, the priority given to different competencies
has changed (notably towards giving more emphasis to the cluster of
human relations, or HRM, competencies in recent times).
The process of filling a particular post starts with the identification
of the vacancy, and the approval from the business director to replace
the person. The manager with the vacancy or the local personnel
manager will contact the chairman of the relevant career working

party (see above) to see what possible candidates are available with
the right profiles. These profiles will include not only the appropriate
combination of competencies but also the appropriate potential grading. However, in addition to the rational lists of competencies, etc.,
there are other criteria which are applied informally - although their
existence is widely known within the company. Thus, for key posts, in
addition to an exceptional track and performance record, the individual should: (i) have worked in another country; (ii) have experience of
more than one business area in the company; (iii) have functional
experience in some depth; and (iv) have managed a substantial number of people at some stage in the career. Much of this was encapsulated into the notion that the individual must have contributed
consistently to the 'bottom line'. Once a short-list of candidates has
been drawn up it is generally up to the immediate manager to interview them, with assistance if appropriate from the local personnel specialist. The final decision over an appointment has to be ratified by
the 'grandparent', or business manager.
In Brit-Met the career management system relies on the appraisal
process for key information about employees. For instance, immediate
(and often temporary) replacements for senior posts tend to be identified, along with longer-term successors, from appraisal data. The individuals on this list were described as 'young, which means under 40
years old'. There is also a list which identifies younger people who are
considered to have potential for senior management some time in the
future. Until 1986 virtually all senior management appointments were
made from inside, but recent problems in identifying the right candidate for senior management vacancies has led to a number of cases
where'external candidates have been sought via 'head hunters'. When
it comes to making appointments, psychometric tests and other
sophisticated selection tools are not used, and most decisions are
made on the basis of interviews conducted by senior managers with
the assistance of personnel managers.
We have summarized in Table I the main criteria reported to have
been used in making appointments. Inevitably, this is a composite picture, especially for the UK where the differences are more marked.
However, it does highlight the major distinction between the UK and
China, where the former tends to use 'hard' performance criteria and
the latter emphasizes 'softer' criteria such as relationships and loyalty.
We have explained above the recruitment and selection procedures
in the Chinese and the UK companies as described by senior managers
and personnel specialists, and to a large extent we found from specific
case examples that the rules were adhered to. However, we did find
several exceptions to the rules in the UK companies and a consistent
Mark Easterby-Smith, Dunusiu Malina and Lu Yuan

Table 1 Promotion criteria in UK and Chinese conpanies
U K only
Shared in both
Chinu onlj~
*
*
*
*
*
'Bottom line' delivery

More than one
business area
Experience in
another country
Deep functional experience

Excellent performance
record
*
*
Loyalty to Party
Good quality of
relationships
Hard worker
Good 'moral' practice
extension to the rules in the Chinese companies. In the Chinese cases it

was evident that the 'four principles' (de, neng, gin and ji) were usually
supplemented by loyalty to the Party and quality of relations with colleagues. The former of these is an ideological criterion, and the latter
is most likely accounted for by the cultural significance of relationships
in China. In the UK we found a number of instances where the procedures were not necessarily applied with impartial rationality. Within
Brit-Chem a replacement for a senior personnel post was being sought
and potential successors were identified through the personal network
of the recruiting manager rather than via the relevant career working
party. Although there was a notional potential grading required from
candidates, this grading was ignored once the managers concerned
decided that they had identified the 'right' candidate for the post.
Another example in the sanie company involved informal consultation
among senior functional managers who produced their own list which
they whittled down to two possibilities. The appointing manager then
started negotiations with the bosses of the two candidates about their
potential release before the candidates themselves knew anything about
the possibility. It is clear from this that, however elaborate and rational the formal system, considerable influence will be exerted on the
process by networks of managers, and individual career success is
highly dependent on having powerful supporters/mentors who will
place possibilities in one's path.
Performance appruiscrl
It is consistent with the above observations (see Table 1) that the
development and maintenance of harmonious relations was also an
important element in the appraisal procedures of our four Chinese
companies. In addition, in all the companies there was an emphasis
on self-evaluations and 'democratic' soundings of opinions.
In practice, a manager was normally expected to carry out a writ-
ten self-evaluation on an annual basis, and these comments would be

reviewed by senior managers and then be transferred to his or her
personnel file. If the manager was also a member of the Party, then
the Party committee would also play a part in the process - resulting
in a kind of dual-track reporting. There is, however, a linguistic distinction between the two processes. The former, which involves communication up the vertical hierarchy, is known as 'reporting' (huibao)
and the latter, which involves cross-functional communication, is
known as 'reflecting' (fanying). Opinions can thus be communicated
legitimately either by direct reporting to the boss or by indirect
reflecting to the Party or personnel people. When there is believed to
be a problem with the boss himlherself then employees would be
expected to 'reflect' this to the Party.
For senior managers it is normal to canvass opinions from a wide
sample of employees on an annual basis. For example, in Sino-Oil it
was described thus:
The way of appraising all (senior) managers is firstly to check herlhis personal
file; and secondly to interview herlhis colleagues. A ratio of one manager to
fifteen or twenty colleagues is used. . . . Finally we use a democratic evaluation
though mass opinions. Normally one manager would be evaluated by thirty to
forty staff in all.
In Sino-Chem the annual survey of opinions among workers and

managers took the form of a questionnaire, and then the Party secretary and personnel manager talked personally to middle managers to
gain feedback about the opinions expressed in the survey. One example provided from this company illustrates the importance of harmonious relationships. The annual survey had shown there to be some
conflict between a Party secretary and two managers in a workshop.
The personnel manager then talked to all three, and also to the workers with whom they worked. On the strength of the information
obtained by the personnel manager, the director decided that the
Party secretary should be moved to another workshop.
In all four UK companies there was a primary emphasis on setting,
and monitoring performance against, targets. Beyond that there were
minor variations both between and within companies about the
involvement of non-managerial employees in the process, in the extent
to which there was a direct link between appraisal and pay, and the
relative emphasis given to the 'developmental' aspects of appraisal.
Although several companies were hoping to extend regular
appraisal to non-managerial employees, most progress had been made
by Brit-Oil, where all supervisors and staff were now included. The
link with pay was most explicit in Brit-Chem, but even in Brit-Met,
where there was no official link, the personnel director commented:
We try and say it's not for pay purposes . . . on the other hand if a bloke does
a super performance then it should be reflected in the pay. So while there is
not a direct link, there's got to be some consistency between the two.
In Brit-Con there was a strong emphasis on the developmental aspects

of the process, such as the identification of training needs and discussion of possible future career moves.
A common feature in all the UK systems was the assumption that
appraisal was based around an annual meeting between the manager
and hisher boss. There were always safeguards if there was a disagreement between the two, and completed protocols were normally
reviewed by the boss's manager; but we encountered no cases of peer
(or subordinate) opinions being solicited as direct inputs to the
process. Opinions from those on the receiving end of the procedure
varied within each company. The two most common opinions were
either that appraisal was a good opportunity to have a focused discussion with one's boss about progress, o r that it was largely a bureaucratic chore from which very little positive benefit ever emerged.
Thus in the area of appraisal there are some consistent differences
between the Chinese and U K companies. In the UK it is conceived
largely as a top-down process focused around an annual interview
between the individual and his or her boss in which performance targets are reviewed. In China the system is based on an annual selfassessment by the manager and there are no automatic one-to-one
interviews with the boss. The opinions of colleagues and subordinates
are regarded as highly significant. This demonstrates a system which is
far removed from contemporary Western critiques which stress control (Townley, 1993) and the primacy of the interview (Beaumont,
1993), very much along the lines that we have noted in our companies. The question that emerges is whether these features are components of 'appraisal' per se or just of the national settings in which the
appraisal systems are located. We will return to this later in the paper.
Reward systems
Wage determination has always been a major issue in China since the
revolution, because policy on distribution has significant implications
both for national ideology and local motivational issues. It is this
interplay between the two levels of analysis that has been at the heart
of the prolonged series of reforms and adjustments that have taken
place since a national, Soviet-style, wage system was introduced in
1956 (Takahara, 1992). Although national systems are now intended
only as guidelines for enterprises we found uniformity between the
companies in our sample. Our comments in this section therefore con-

centrate on general policy and practice in China with occasional reference to specific cases when they appear to depart from the general
norm.
During the Cultural Revolution there was a strong emphasis on
maintaining an egalitarian wage policy, but this was changed after
1978 by Deng Xiaoping and his supporters under the slogan 'to each
according to his work'. Pay was to be based on a basic wage determined by job level and wage category, and a bonus which on average
would not exceed two months' salary in any one year. Bonus was
linked to the overall performance of the enterprise. This was further
refined by the introduction of the 'structural wage system' in late 1984
which comprised four main elements: base wages (jichu gongzi), position wages (zhiwu gongzi), seniority supplements (gongling jintie) and
bonus wages (jiangli gongzi). The first two of these were the major
items, and position wages were loosely linked to the national grading
system mentioned above. This reform was not universally welcomed
and limits were again suggested for bonuses. However, Takahara's
(1992) analysis showed that there were many ways in which companies circumvented official guidelines on bonus payments, often establishing local competition between companies in this respect - a
process known as panbi. The key point is, however, that bonuses
remain very similar for all employees in a company, and there has
been much resistance to the introduction of differentials between individuals or even between different groups of workers or levels of the
organization.
The principle of 'eating from the same pot' was again challenged in
the enterprise reforms established in May 1988 and there are now
signs that bonus systems are stretching internal differentials much
more than before. Thus, managers in Sino-Met reported in 1992 that
they were earning bonuses that more than doubled their basic salary
of 250 to 300 yuan per month. This ties in with Warner's recent
analysis of payment systems in ten enterprises in NE China which
shows that most companies still use variants of the structural wage
system with a mixture of group and individual bonuses accounting for
up to one third of salary (Warner, 1994). The larger bonuses paid at
Sino-Met would be expected in a company based in Guangzhou, since
salaries are moving much faster in some southern and coastal cities
(Warner, 1993).
Despite the growth of bonus payments in China, the contrast with
the UK is stark. Differentials between top managers and average
wages are much greater and merit-related pay is commonplace. The
toplaverage ratio in our four UK companies varied from 20:l to 40: 1,
whereas the basic differential in Chinese companies is still no more
Mark Easterby-Smith, Danu.sia Mulina and Lu Yuan

than 4: 1. Performance-related pay has received much publicity in the
UK recently in relation to the remuneration of top managers - and is
often seen as a way for top people to circumvent tax regulations and
the austerity programmes that they impose on their employees. T o the
extent that performance-related pay has received a bad press recently,
there may be less glaring examples of its misuse by the captains of
industry in the future. Nevertheless, there was a strong drive towards
greater individualization of pay in all four companies. Within BritChem the Hay method of job evaluation has recently been introduced
for managers (superseding an older system). This has a notional reference point which is determined through negotiation with staff groups,
and salaries can vary between 80 per cent and 130 per cent from this
point. Such a system was said to, 'Widen the opportunity for managers' discretion to reward extremely good performance'. For some
time the company has also been trying to introduce a similar scheme
among non-managerial employees. But, as one senior manager put it,
We still haven't been able to win the battle with the signatory unions around
appraisal of individual performance . . . so there's no opportunity to pay people individually.
Brit-Oil had a similar philosophy towards payments, and also succeeded

in getting overall agreement with the trade unions for an individualized
reward system. There are four potential grades around each target
salary point varying from 90 to 120 per cent and high-performing
individuals generally reach the maximum level after three to four
years in a particular job. In Brit-Con there is an interesting variation
on the theme of individualized pay around what is referred to as
'competency ladders'. Thus people who acquire additional competencies related t o the business (these follow the NVQ format) are
rewarded with incremental steps up an ascending scale. This represents a move from the use of payment systems in straight motivational terms to more of a developmental focus, implying the need for
greater flexibility. The personnel director confirmed this in the following way:
The underlying philosophy behind the competence ladders is our way of progressing flexibility . . . we need to be more and more responsive to different circumstances and to the changing needs of customers, we need better skilled
people.
The only possible exception to the trend towards greater individualization was Brit-Met where a collective bonus scheme existed for all
employees up to and including middle management. This bonus was
linked directly to profits through an annual negotiation with the
unions, and it replaced an earlier scheme based on 'value added'.

Thus, there is much similarity among the UK companies and
among the Chinese companies with regard to remuneration, and it is
therefore possible to generalize about the differences between the two
countries. The main differences are the greater differentials that exist
between the top and the bottom of UK companies, where there is also
far more use of individualized payment systems. Although there is evidence of individualized payment being discussed in China there is still
much resistance to its implementation - and the preference remains
for group incentive schemes.
Trade unions
There is only one union in China, the National General Trade Union
(ACFTU), and all enterprises contain branches of this union.
However, it is difficult to gain an understanding of the role of the
union without considering at the same time the Party and the executive. The official position is that executive directors are responsible for
business operations, the Party holds responsibility for strategic issues
to do with business and personnel matters and the union looks after
policy on employee remuneration and welfare. A key role for the
union is the organization of annual meetings of the Workers'
Congress, which receives reports from directors and discusses general
strategic issues. According to the Enterprise Law of 1988, the
Congress is the highest legitimate body within a state enterprise,
although it normally delegates its powers to a management committee
comprising directors, Party and union officials and representatives of
employees. The union also has further influence through its president
who is a member of the enterprise executive committee and through
its statutory role in representing workers when any disciplinary or dismissal proceedings are invoked.
In practice, however, we found much ambiguity about the role of
the union. There are many overlaps among the actors and structures
involved. Thus as one manager in Sino-Chem commented in relation
to the membership of the executive committee:
It is only a problem of names. Sometimes it is called the Executive Committee.
Later it is called the Party Expanded Committee. After the Enterprise Law
was published it became the Managerial Committee, but most of the members
are the same personnel, in terms of the directors, the Party secretary, the union
chairperson and other important executives.
With the constant triangular relationship between executive, Party and
union, the role of the union is to support the Party in the discharge of
its functions. With the exception of the example above, the union is
not perceived as an independent political force within the enterprise
and we encountered no examples of it acting independently in the

companies studied. Even the Workers' Congress had limited power in
relation to the executive. As one manager summed it up:
[In theory] the manager should implement the decisions of the Workers'
Congress. [In reality] if the Workers' Congress decided to renovate accommodation within enterprises and the director disagreed then the above would not
necessarily follow. In this case, the director would have the power to reject the
decision because issues relating to accommodation d o not fall within the relational boundaries of the Workers' Congress.
The role of the union can be further weakened if the enterprise establishes a joint venture with a foreign company. In the case of SinoMet, which became a joint venture with a Hong Kong company in
1988, there is n o management committee for the Workers' Congress,
because legislation does not apply to joint venture companies. Thus
another legitimate channel of union influence is lost.
In all four UK companies it was evident that the unions have
become less significant over the last decade, and their adversarial role
has lessened. This is partly a product of external factors such as
national legislation under the Thatcher government and the widespread fear of job loss in the general recessionary climate towards the
end of the 1980s. In all four cases management had put much thought
and care into the management of relations with the unions, with much
emphasis on reducing their number and on obtaining agreements on
flexible work practices. All companies had worked hard to get union
representatives to understand the business realities that they were facing and to reduce the attention given to disputes and issues of remuneration. This meant sharing a lot of confidential commercial
material, which presupposed a higher level of trust between the two
parties.
Managers also operated in an opportunistic way, using different
pretexts, such as the development of a new plant or a major organizational restructuring as the trigger for new initiatives. This ties in with
the observations of Blyton (1992) about the opportunistic approach of
British Steel in attempting to change traditional work relations.
However, we also detected in our study slightly different rhetorics:
thus Brit-Met and Brit-Oil talked a lot about the need for good relations and communication with the unions (rather as in the Chinese
companies); senior managers in Brit-Con and Brit-Chem talked about
the growing irrelevance and marginalization of the unions.
It is very clear that there has been a significant change in relations
between management and unions in the four companies over the last
decade, and much of this, as Storey (1992) notes, has been driven by
management. When Brit-Con was faced with the need to restructure
and downsize significantly during the mid-1980s, the strategy concentrated on renegotiating the relationship. As one senior manager put it:
[Management] sat down together and said if we throw away all the restrictive
practices that exist in the old factory and if people worked to their own potential, in other words not by some rules of a trade union, then to make that
work, you would have to increase flexibility. To do that we had to sell a completely new philosophy to the unions, to the workforce. That was a hell of a
change.
This policy was successfully implemented at the time, and since then
there have been further moves towards the decentralization of union
power within the company by ensuring that wage bargaining is conducted at plant level rather than company-wide - although both company and union still try to ensure that there is reasonable
comparability between different sites.
Thus there is evidence of a weakening role for unions in both countries. But, apart from the manifest institutional differences, there are
still some distinctions. The notion of partnership is still strong in
China and the union operates legitimately as one of the three main
players within the politics of enterprises, even though this is somewhat
under the shadow of the Party. In the UK the adversarial role of the
unions still lingers. In parallel, however, with their reducing influence
over the last decade they have been encouraged by some companies,
and forced by others, to adopt new roles and relationships. This has
included accepting greater flexibility, more decentralization and a
reduced role in remuneration bargaining.
Discussion: the role of culture and context

We commented at the beginning of this paper on the debate about the
cultural transferability of HRM. Is it essentially an American concept
which does not travel easily to other cultures, including those of
Western Europe (Guest, 1992a), or is it an idea that has universal
applicability? The debate is somewhat confused by the fact that many
of the ideas incorporated into the 'ideal' model of HRM have already
been borrowed from Japanese employment practice, and there are also
different interpretations of both the principles and practice of HRM in
Western countries (Strauss, 1992; Storey, 1992). That is why we think
it is valuable to compare practice in matched companies in the UK
and China. As explained earlier we do not assume that observed
national differences are necessarily the product of cultural factors. In
this section we analyse the observed differences according to whether
they appear to be the product of cultural factors (essentially, deeply

held feelings and beliefs of the people involved) or of contextual factors (the particular structures, institutions and regulations of the country). Of the two it is assumed that cultural factors are far less mutable,
and hence the areas of H R M that are most affected by cultural differences are the elements that are least likely to travel from one country
to another.
If we start with the area of manpower planning, then it is clear that
the analytic elements of potential rating systems and succession planning function equally well in Chinese and UK organizations. Indeed,
here there seems to be more difference within the U K than between
the U K and China. The differences in the UK, when the information
from our study is compared with the absence of manpower planning
in the study of Storey (1992), seem to be a product of the kind of
technologies involved, the size of organization and the customs within
that particular industry with regard to internal development or 'buying people in'. These, as defined above, are largely contextual factors,
which suggest that manpower planning is a practice that can travel
quite easily from one country to another provided the companies concerned are of similar types.
The main differences here between the Chinese and U K companies
were according to who made the assessments about potential, and the
linkage between these assessments and decisions about the development of the individual. It is notable that there may be much greater
involvement of line management in the U K companies (one of the elements of the 'ideal' H R M model), whereas the bulk of the work in the
Chinese companies was a stafflparty responsibility. This latter pattern
corresponds to the old-style (pre-HRM) personnel management - and
thus this difference could be a matter of different stages of history1
evolution rather than anything deeply rooted in a particular society.
There is a major similarity in the role of unions in China and the
UK: both appear to be becoming less influential within enterprises.
While legislation generally supports the status of the union in China,
in practice it is very difficult for it to operate as an independent force,
and it is therefore possible for companies to marginalize it if they
wish. In the UK both legislation and the economic climate tend to act
against the power of the union, unless the company makes a positive
decision to seek a collaborative relationship with it.
There are also two main differences. Firstly, there are the institutional structures, such as the Party, which have no parallel in the
other country, and, secondly, there are the different orientations of
unions towards management. Essentially, the Chinese unions are
meant to be supportive, while the UK unions are founded on an
adversarial stance. The explanation of these differences is therefore
partly contextual - to do with the institutional structures and historical roots of unions in each country. In addition, one can identify cultural factors such as the importance of 'harmony' in Chinese society,
which means that confrontation, and the adoption of an adversarial
stance, are not easily accepted.
In the case of manageriul appointments there seem to be elements
that can also be explained by both cultural and contextual factors.
There were no consistent differences between the two countries in
terms of the procedures for making appointments: this was generally
under the control of senior management (with the added element of
Party involvement in China) and a variety of methods were used to
identify and assess potential candidates for posts including internal
adverts, headhunters and informal personal networks. Personal contacts are most important in both countries. In China people talk of
the importance of relationships (guanxi), and people in all the UK
companies talked of the importance of having sponsors or mentors to
help in one's career.
The national differences were mainly around the criteria that were
used to assess suitability of candidates. In the UK there is much more
emphasis on the demonstration of business results and on the breadth
of personal track records. Although these elements are important in
China, there seems to be more concern with how the manager operates (moral behaviour, good relationships with others, etc.) - a concern with means rather than ends. Although one of the current key
criteria in China (loyalty to the Party) is presumably very much a
contextual factor, the remainder of these factors seem to spring from
much more deeply seated beliefs about the way people should relate
to each other as social beings - and are hence most likely to be cultural attributes. Thus, it would appear that, because of the greater
cultural dependency in this case, HRM procedures associated with
managerial appointments will be less easy to transpose from one
country to another than, for example, manpower planning procedures.
The differences between the UK and China with regard to appraisal
procedures are very marked, much more so than any variations
between companies within either country. Three key differences
between the two countries are the use of respectively: hierarchical
judgements versus peer and subordinate views; the existence or not of
a single formal interview; and the UK focus on targets versus the use
of broader criteria in China. These can be linked directly to known
cultural differences such as the importance of harmonious peer and
subordinate relationships (Lockett, 1985; Osigweh and Huo, 1993).
'Face' is also significant because it is less likely to be at risk if the
direct confrontation of a formal interview is avoided. The difference
Mark Ensterby-Smith, Danusia Malina and Lu Yuan
regarding targets can be accounted for by the fact that in China relationships with employers are seen in terms of personal obligations
rather than impersonal contracts (Laaksonen, 1988).
Thus it is clear that the activity of 'appraisal' can be constituted in
ways very different from the prevailing practice in the UK. Whether it
will continue in this way in China is another question; but it is hard
to imagine that the significance of harmony and 'face' will diminish
very quickly in Chinese society despite growing foreign influences and
the pressures of the market economy. It is well over a decade since
Deng Xiaoping first suggested that it was good for individuals to 'get
rich', and this idea still has not had much effect in state enterprises.
Nor have features such as face and the significance of relationships
lessened in Chinese business communities outside the People's
Republic (Redding, 1990).
The differences with regard to pay and renzuneration systems represent another step along the scale towards cultural differences. The limited differential in salary between people at the top and bottom of
Chinese (state) organizations is exceptionally small even in relation to
Japan. Despite the exhortations from Party leaders that it is good for
people to get rich, and the gradual introduction of the responsibility
system (providing for group and individual profit retention) in both
industry and the countryside, there is still limited acceptance of overt
differences in remuneration: the 'red eyed' syndrome is very strong. As
mentioned earlier, this is also recognized by companies which choose
to establish bonus systems providing equal shares across different sections of the same organization. In contrast, UK companies maintain
large differentials between those at the top and those at the bottom,
and there has been a distinct trend over the last decade towards
greater internal differentiations as evidenced by the increase in local
(rather than national) pay negotiations and agreements, and the rise of
performance-related pay for managerial staff. Although this latter is
now apparently giving way in some cases to competency-based remuneration systems, it is still indicative of individual differentiation.
These changes in UK companies may be explained by fashion - by
changes in reward strategies and greater adoption of the 'HRM' philosophy - and thus they are largely contextually dependent. However,
the general resistance to change in China can be attributed mainly to
cultural factors, such as the high levels of collectivism (Hofstede,
1991), the need to maintain harmonious relations within the organization (Osigweh and Huo, 1993) and the general distrust of mechanistic
methods for producing differentials (Warner, 1993). We should also
note here the cautionary point of Pennings (1993) who observed from
a recent cross-national study of executive 'compensation' schemes that
financial rewards have very different significations in France and the

Netherlands, in contrast to the USA. Also of relevance to the current
study is his plea for more direct comparative research in this area,
especially with countries that diverge significantly from 'the US
norm'. In our comparison between China and the UK we can see just
how strong these differences are.
Conclusion
Our conclusions cover three areas: firstly, a summary of the substantive findings regarding HRM in Chinese companies, and also a few
points about the UK companies where unusual features are identified;
secondly, some observations about the extent to which HRM appears
to vary as a result of culture or context; and, thirdly, some comments
about the limitations of the present study and the directions in which
we believe future work would be profitable.
The study has demonstrated that large Chinese companies do
indeed have highly sophisticated methods for planning managerial
resources, on similar lines to those in some of the more advanced UK
companies. There appears to be much variation in procedures for
making appointments in both countries, and it was noticeable how
often the supposed 'rational' systems for making these decisions in
UK companies were circumvented. Appraisal procedures in the UK
focus on the contractual relationship between the individual and the
company, mediated through an annual interview with the boss;
whereas the process is much more diffuse, and conceivably more
'democratic', in the Chinese context. It islalso likely that it will be
some time before the Contractual Labour System will have much
impact on such matters in China.
Although there are attempts in both countries to link pay and
rewards more closely with performance, there is very strong resistance
to this principle within Chinese companies - and even in UK companies there are other variants such as the introduction of 'competence'
payments. Finally, there is a basic difference between unions in China
and the UK, in that the former have a more collaborative stance to
management compared with the traditional adversarial position of
UK unions, but there are also signs in both countries of unions
becoming more marginalized.
The main differences in HRM between the two countries, therefore,
appear in the 'softer' areas where relationships are important:
appraisal, reward systems, the process of assessing potential and the
basic stance of unions towards management. These differences can be

linked to known cultural factors such as the greater concern for relationships, for harmony and the preservation of 'face' in China. Other
variations in HRM are not clear-cut between the two countries, and
they also show a lot of variation within each country. These are more
likely to be a product of industrial or local institutional differences.
Examples come primarily from the organizational elements of HRM
such as manpower planning, the relative contributions of specialists
and line management in assessing potential, and the institutional
structure of unions.
At this stage one must conclude that, despite a few areas of similarity between the UK and China, there are strong cultural factors which
limit the adoption of many features of HRM in China. This provides
further support to those who adopt a culturally relativist view of
management and HRM. Furthermore, the comparative analysis of
this study demonstrates just how much both practices of, and debates
about, HRM are dependent on the cultural assumptions underpinning
them. Lack of awareness of this dependency will greatly limit the richness of theoretical insights, the potential for generalization and the
utility of any prescriptions that evolve.
We are aware that there are a number of gaps and shortfalls in this
study. For example, it focuses on large organizations and, therefore,
does not encompass the rapidly developing private sector and the
smaller businesses that are burgeoning in the coastal areas of China.
We have not covered training and education, for good reasons we
believe, but any complete analysis would also need to take account of
these areas. And we have not been able within this study to monitor
changes in companies over time - beyond the three years that were
required for data collection.
We have tried to compensate for this by relating our findings where
possible to other studies carried out previously, but it is clear that,
with the rapid developments taking place in China at the moment,
genuine longitudinal studies are likely to be of the greatest significance
in the future. These could focus on the processes whereby legislation
such as the 1992 reforms is having an impact on enterprises, on how
the move towards more individualistic contracts is affecting the role
of unions and on how the moves towards privatization are affecting
attitudes towards differential rewards.
Murk Easterby-Smith
The Management School
Lancaster University
Danusia Malina
Department of Retail and Marketing
Munchester Metropolitan University
Lu Yuan
The Judge Institute
Cambridge
UK
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How culture-sensitive is HRM?

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The International Journal of Human Resource Management 6:l February 1995

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How culture-sensitive is HRM? A

Mark Easterby-Smith, Danusia Malinu and Lu Yuan

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How culture-sensitive is HRM?

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Mark Easterby-Smith, Danusia Malina and Lu Yuan

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How culture-sensitive is HRM?

through a series of papers which were circulated and discussed with

Background to HRM in China

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Mark Easterby-Smith, Danusia Malina and L L Yuan

A limited amount of academic research has already been carried

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How culture-sensitive is HRM?

HRM in Chinese and UK Companies: Results

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Mark Easterby-Smith, Danusiu Malina and Lu Yuan

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How culture-sensitive is HRM?

by personnel and HR specialists. The specialists were also responsible

Mark Easterby-Smith, Danusiu Malinu and Lu Yuan

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influence of the Party depends, as we shall see in the next section, on

We were given three examples of senior appointments in different

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How culture-sensitive is HRM?

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Murk Eusterby-Smith, Danttsia Malina and Lu Yuan

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How culture-sensitive is HRM?

Mark Easterby-Smith, Dunusiu Malina and Lu Yuan

'Bottom line' delivery

Deep functional experience

extension to the rules in the Chinese companies. In the Chinese cases it

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How culture-sensitive is HRM?

ten self-evaluation on an annual basis, and these comments would be

In Sino-Chem the annual survey of opinions among workers and

Mark Easterby-Smith, Danusia Malina and Lu Yuan

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In Brit-Con there was a strong emphasis on the developmental aspects

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How culture-sensitive is HRM?

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Mark Easterby-Smith, Danu.sia Mulina and Lu Yuan

Brit-Oil had a similar philosophy towards payments, and also succeeded

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How culture-sensitive is HRM?

Mark Easterby-Smith, Danusia Malina and Lu Yuan

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and we encountered no examples of it acting independently in the

How culture-sensitive is HRM?