“I hired a student from a local university to do my translation…and it ended up hurting my reputation.”

This was the story I heard from a business contact I met with a couple of weeks ago. He works for a large chemical manufacturer with a presence in China, and they needed their website translated into Chinese. His choice was to hire a local student from China for the job. Once he presented the translation to his Chinese business partners, they weren’t impressed — the errors actually made him and his company look less professional in their eyes.

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Wholly Foreign Owned Enterprises (WFOEs) or limited liability companies whose investors are purely foreign are quickly becoming the most popular method of foreign investment in China. While foreign companies once thought (and were often compelled by laws) that a local partner was necessary to operate business in China, this is increasingly no longer the case in a wide range of industries.Characteristics of WFOEs:

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Building a talent pipeline is not easy in China and you will need all the help you can get.

Those who get to know you or to know about you through a third party grant you a higher level of confidence, credibility and loyalty. According to Dr. Robert Cialdini in his amazing book; Influence: The Psychology of Persuasion, this is social proof in action.

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In terms of human resources, the current debate is focused on the continued need for multinational corporations in China to increase hiring of local staff, particularly for operations management, while decreasing or completely removing expatriate staff. Reasons for this shift away from expatriate staff include the high cost of salary and benefit packages, questionable value (in terms of productivity and ability to drive the business), high failure rates and most recently, the large readily available talent pool of expatriates already based in China (“halfpats”).

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While massive amounts of money is being spent on marketing in the run-up to the Olympics to capture China 250 million strong emerging middle class, unfortunately most marketing campaigns are failing to deliver the results that the sponsors like Coca-Cola or Adidas were hoping for. My latest piece looks at the effectiveness of Olympics sponsorship and …

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