New to HR? Templates, tools and development to make you a seasoned pro in no time.
Shawn Premer shows how doing the right thing for employees leads to positive business results.
Is your employee handbook keeping up with the changing world of work? With SHRM's Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Build competencies, establish credibility and advance your career—while earning PDCs—at SHRM Seminars in 12 cities across the U.S. this spring.
#SHRM18 will expand your perspective – on your organization, on your career, and on the way you approach HR. Join us in Chicago June 17-20, 2018
Members may download one copy of our sample forms and templates for your personal use within your organization. Please note that all such forms and policies should be reviewed by your legal counsel for compliance with applicable law, and should be modified to suit your organization’s culture, industry, and practices. Neither members nor non-members may reproduce such samples in any other way (e.g., to republish in a book or use for a commercial purpose) without SHRM’s permission. To request permission for specific items, click on the “reuse permissions” button on the page where you find the item.
The year ahead could see companies in China feeling the disruptive impact of technology, chief information officers becoming a hot commodity, the government focusing on job creation over growth, and shoddy infrastructure reaching its end life, according to Gordon Orr, director and chairman of McKinsey Asia, based in Shanghai.
In a recent podcast, Orr laid out two macro themes that will shape China in 2014: productivity growth and technology-based disruption.
He explained that China’s input costs continue to grow while intense competition and overcapacity dissuade businesses from passing price increases on to customers. “Labor costs continue to rise by more than 10 percent a year, land costs are pricing offices out of city centers, the cost of energy and water is growing so much that they may be rationed in some geographies, and the cost of capital is higher, especially for state-owned enterprises.”
Orr sees higher productivity as the solution. This productivity focus will extend beyond manufacturing, he said, and include agriculture and services.
“And in industry after industry, companies will feel the disruptive impact of technology, which will help them generate more from less and potentially spawn entirely new business models.” Orr pointed out that more and more consumers want to buy commodities and receive comprehensive services online. With technology making that possible, businesses will have to reinvent the way they interact with customers. “Will Chinese consumers be willing to bank online?” he asked. “Absolutely—if their willingness to shop online is any guide.”
The Emergence of CIOs
The scarcity value of the chief information officer (CIO) is going to skyrocket, Orr predicted. Describing China as a “laggard in applying business technology in an effective way,” he cited a McKinsey survey that showed that Chinese companies widely regard the IT function as effective in helping run the business but not in helping it to expand. Simply trying to find the CIO in many state-owned enterprises is like searching for the proverbial needle in a haystack, he quipped.
In many enterprises the productivity imperative will make technology a top team priority for the first time, he said. “Everything is on the table: digitizing existing processes and eliminating labor, reaching consumers directly through the Internet, transforming the supply chain, and reinventing the business model.”
Orr forecast large compensation packages and a talent war over strong CIOs.
The Chinese government will shift gears from economic growth to job creation, he predicted, as the country needs millions more jobs. Many manufacturers, both multinational and Chinese, are producing more with less. For example, Foxconn announced in 2013 that it wouldn’t hire any entry-level workers, instead relying on automation and employee retention.
“So as technology enables massive disruptions in service industries and sales forces, what happens to millions of retail jobs when sales move online?” Rising numbers of university graduates will have fewer and fewer jobs that meet their expectations, he said, adding that this will create unhappiness and put pressure on state-owned enterprises to improve their performance, to use capital more efficiently, and to hire and retain staff.
Infrastructure Tipping Point
Orr observed that much of the residential and office construction in China over the past 30 years used low-quality methods and materials that are aging badly. Now, buildings barely 20 years old are visibly decaying. “Many will need to be renovated thoroughly, others to be knocked down and rebuilt. Who will pay for this wave of reconstruction?”
Roy Maurer is an online editor/manager for SHRM.
Follow him at
Global HR page
Keep up with the latest
Global HR news
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Please sign in as a SHRM member before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
Talent Attraction Study: What Matters to the Modern Candidate
Apply by March 23
SHRM’s HR Vendor Directory contains over 3,200 companies