Talent retention critical to multinationals
By Liu Baijia (China Daily)Updated: 2006-12-25 14:03
According to Mercer, the overall turnover rate in 2005 was 12.8 per cent. For high-tech companies, it was 13.2 per cent and for the pharmaceutical industry, it was as high as 17.6 per cent.
While companies fight for talents to staff their rapidly growing China business, employee retention has become a key factor in the world's fastest-growing major economy
With China's economy almost doubling in the past five years and expected to maintain about 10 per cent annual growth this year and the next, almost every company is in dire need of more hands on board and employees face abundant opportunities and temptation to leave.
The reasons for moving on are manifold.
It could be a change in the work atmosphere as with Jane Liu, who worked in Intel China for nine years and decided to call it quits in September.
During the previous few months, she had seen almost her whole team leave: the director as well as colleagues in Shanghai, Beijing and Shenzhen so she was suddenly faced with quite a few new faces from different corporate cultures.
In other cases, it could be a team moving en masse, as with Dell the world's second-largest PC maker which lost six key executives in the Asia Pacific region in one month: the vice-presidents in charge of sales and marketing, and services, Dell China President, and directors in Dell Japan.
All of them crossed over to Chinese competitor Lenovo Group, interestingly, the world's third-biggest PC maker.
James Guo, president of Shenzhen-based ZDL Executive Search Co one of the top 10 headhunting firms in China says a major reason for the high turnover rate among some large multinationals, which have been very successful in China in the past, is a change in their market positions.
"Both Intel and Dell do not enjoy the same dominant position as before, so employees are concerned about the future or are worried about lay-offs," says Guo.
Intel has been steadily yielding ground to arch-rival AMD in providing new solutions such as 64-bit computing for enterprise customers and dual-core microprocessors.
In the past four years, AMD has won the endorsement of all major computer
makers in China and its market share rose from only a fraction in 2002 to 25 per
cent.
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