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Chinese firms abroad

Chinese companies can take five steps to help achieve success in other countries, says article in The World Financial Review by Professor David De Cremer of Cambridge Judge.

Chinese firms abroad

There are five steps that Chinese companies can take to help them transform into a global company, according to an article in The World Financial Review by David De Cremer, KPMG Professor of Management Studies at Cambridge Judge Business School.

Chinese companies going abroad in the past have often had a short-term focus on acquiring new technology and financial gains as quickly as possible, but they need to focus more on future strategy for acquired foreign companies and their work forces, says the article, entitled “What it takes for Chinese companies to succeed abroad”.

Looking at the Chinese telecoms company Huawei, the article identifies five policies that can help Chinese firms become more global.

  1. The use of clear policies and processes: teamwork in China is usually regarded as following leaders’ instructions, so Chinese employees arriving in a new country need clear guidelines in order to adapt to more Western management structures.
  2. The use of a language proficiency test: companies that invest in foreign language proficiency for employees enjoy stronger relationships with clients.
  3. Training on security, laws and regulations: such training can help overcome suspicion and concern about security among Western counterparts, who perceive corporate governance in China as limited.
  4. Focus on employee health: staying healthy can help staff better focus on career development while posted overseas.
  5. Focus on cultural assimilation: guidance to help employees adapt quickly to local culture can help overcome the stereotype that Chinese firms have difficulty escaping their own national corporate culture.