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Tuesday, April 11, 2006
Forbes writes, "China's economic boom and attendant surge in intellectual property theft and financial crimes are taxing the skills of personnel departments. The demand for those skills is making personnel into one of the hottest careers in China today". Mercer assessment shows, wages in China for top HR executives of multinational companies grew 20% in each of the last two years to $97,000-in a country where per capita income is 1% of that figure. The article points to the risk of a bad hire and corporate-snooping outfits are thriving as clients demand more background checks on their partners and employees. Due to historical reasons, there are no good national databases for checking employment histories, education credentials and criminal records. The cost to check out a potential or past hire can range from $100 to $5,000, more than in the U.S., where criminal, legal and credit databases are more easily checked. Not surprising - this is known to those associated with china related sourcing opportunities. I earlier pointed to the disappointment that foreign enteprises publicly aired in terms of scaling up resources in china. Amongst the problems : A lack of bilingual Chinese IT professionals, for jobs such as team leader, is also holding back expansion. From a service provider perspective, one English and Chinese speaking programmer is required to oversee a team of four local developers who speak only Chinese. Because there is only a small number of bilingual programmers, they can command a salary premium of 30-40 per cent. These labour market deficiencies have not gone unnoticed among customers in the US, which is the biggest market for Indian IT. Companies cannot quickly and inexpensively employ locally in response to a sudden burst of project-based work, which is a feature of the industry. In particular, there is a lack of suitable local applicants for jobs as project managers and quality control managers.As I see it, with all these bottlenecks, it may well be the case that China is not a big force in software services. A recent sandhill survey on offshore product development showed that just 5% share went to china for offshoring. Looks to me china for pan chinese market may hold out to be a good value proposition - if skill base can be harnessed and a lot of people are trying to develop - they are trying hard.
Category :China, Offshoring, Emerging Trends |
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