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Human Resource Management Case Study: The Liang Brothers Xin And Jiang

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Decision Problem: The Liang Brothers, Xin and Jiang, must decide how to privatize their family guest house heritage from a mainland China SOE. Four urgently emerging human resource issues arose from this case:
First of all, the old SOE employees were poorly motivated and there were no incentives in place at all. There was no pay mix internally aligned with any pay structure. The goals of employees were not aligned with the company’s vision and long-term management strategies if there were any. Low employee morale and productivity combined with corrupted business model severely affected the occupancy rate and profitability of the guest house.
Secondly, the internal and external competitiveness are both off the balance and unfair. …show more content…

There is no HR strategy so there is no matching with the corporate strategy at all. The culture of the house is simply set by the senior management and simply inherited the traditional way of SOE corrupted culture. Organization design, compensation and benefits are all blur and based on ad hoc approach. In addition to lack of training and standardized recruitment rules, HRM in the house also has no evaluation and feedback loop from the employees. The internal promotion depends on Guanxi and relationship with the management.
Plan for the next 6 months to 1 year
It is important that the brothers must realize the importance of Guanxi in the process of shifting from SOE to privatization. To utilize their two cousins strong local connection in their Guanxi network can be extremely beneficial to both short term and long term development. The proposed the privatization HR plan for the brothers in the next 6 months are:
1. get to know the Guanxi network who are the major players: this task will be the most important one that the brothers should start right away and continuously expand their Guanxi network both locally and in China. To succeed in this task, the brothers must obtain a list of current senior managers and their relationship in and outside of the guest house. First, it will help the brothers understand relationship both internally and externally. Then the brothers need to find ways to get connected with people with authorities that these managers know. The

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