Under the background of the new economic normal, with the continuous upgrading and optimization of industrial structure and the reduction of government preferential policies, the development of foreign-invested enterprises is generally facing difficulties, attracting and retaining talents has become the focus of competition, and scientific and reasonable salary management is an important link for enterprises to form talent advantages, which is of great significance to enterprise development. The foreign-invested enterprises, represented by AK Company, analyze the problems existing in their salary management, such as single salary structure, separation of performance appraisal and salary incentive, and imperfect promotion system, and put forward corresponding measures to improve their salary management, so as to inspire and draw lessons from the development of foreign-invested enterprises.
Foreign-invested enterprises; Salary structure; Floating wages; Promotion system
Foreign-invested enterprises refer to enterprises established in China according to the laws of People's Republic of China (PRC), which are jointly invested by China investors and foreign investors or invested by foreign investors alone. With the maturity of economic development and the deepening of supply-side reform, China's economy is moving towards a new normal trend. However, in recent years, the performance of foreign-invested enterprises in China is poor and their development is facing difficulties. The reasons mainly include the following aspects: first, the increasing labor cost has compressed the profit space of foreign companies; Second, the adjustment of preferential policies enjoyed by foreign enterprises and the tax reform in China have brought certain operating pressure to foreign enterprises; Third, the strength of local enterprises has improved and the market competition has become increasingly fierce; Fourth, China's legal system has been continuously improved, and commercial bribery and monopoly have been severely cracked down. In this case, some labor-intensive foreign-funded enterprises in China have moved to South Asia, Southeast Asia and other regions. Some foreign-invested enterprises actively adjust their responses, promote their own transformation and upgrading, and more technology-intensive and asset-intensive foreign-invested enterprises move into China. At the same time, some problems in the salary management of foreign-funded enterprises in China have restricted their development in China. With the development of knowledge economy, outstanding talents have become the key factor for enterprises to maintain vitality and creativity and achieve sustainable development. As an important part of human resource management, salary management plays an effective incentive role in attracting and retaining talents. Therefore, this paper takes AK Company as an example to study the salary management of foreign-funded enterprises.
First, AK Company and its salary management status
AK Company is a wholly foreign-owned biotechnology company, established in 1995 and located in Hangzhou, Zhejiang Province. It is the global strategic production base of XX Group, with more than 600 employees. With the technical support from the headquarters and domestic production bases as the development guarantee, the company's products cover many fields, such as biological diagnosis and medical devices, and are sold in more than 40 countries around the world, and have successfully developed medical devices such as blood glucose meters and hemoglobin analyzers, and rapid diagnostic products such as corresponding detection reagents. As a company that is transforming from labor-intensive to technology-intensive enterprises, the situation of AK Company is the same as that of most foreign-funded enterprises in China. Therefore, taking AK company as a typical representative of foreign-invested enterprises, its research results have certain practical significance for the development of foreign-invested enterprises. At the initial stage of investment in China, AK Company mainly produced and processed products, and its organizational structure was relatively simple. However, with the constant changes in the objective environment and its own strength, AK Company has transferred part of its technology research and development work to China, and the influx of technology research and development talents has made its organizational scale grow. Therefore, AK Company has formed the current salary system according to its own development. The details are as follows: According to the salary level of employees, the average monthly income of AK Company is about 5,000 yuan. According to the data released by China Commercial Industry Research Institute in 20 17, the average monthly salary in Hangzhou is 7,608 yuan, which is in a lower position in the region compared with the per capita monthly income nearby. From the perspective of salary structure, it includes fixed salary, floating salary and welfare. Among them, fixed wages include basic wages and allowances. Floating salary includes performance salary and bonus commission; Benefits include five insurances and one gold, annual leave, etc. AK Company decided to adopt mixed compensation strategy according to different organizational structures and employee types. Among them, adopting market-oriented salary strategy for technical and R&D personnel, enterprises hope to attract a large number of outstanding talents, improve their core competitiveness and promote their own transformation; Adopt the salary level of performance incentive system for marketers to improve their work enthusiasm and create greater economic benefits; For those who are engaged in basic daily work such as finance, human resource management and administrative management, follow-up salary strategy is adopted. According to the above analysis and research on the salary status of AK company, we can see that there are still many problems in the salary management of AK company, and these problems are also common problems in the salary management of foreign-funded enterprises at present.
Second, AK company salary management problems and reasons
(A) single salary structure, low economic benefits
The salary of AK company consists of fixed salary, floating salary and welfare, in which the fixed salary is mainly basic salary, which increases by 5% every year; The floating salary is mainly bonus, and the year-end bonus is 1-2 months salary reward according to different positions; Welfare includes statutory social security and annual leave. Without measures with high incentive effect, employee satisfaction is generally low. On the one hand, AK entered the China market at the end of last century. After more than ten years of rapid development, the development stage and environment of enterprises have changed greatly, but the salary system of enterprises has not been reformed and innovated. On the other hand, in recent years, some foreign companies are facing difficulties in their development in China. The increase of cost leads to the decrease of net profit, and the salary cannot guarantee the original increase of 65,438+00%-20%, so it is difficult to improve the economic benefits. Therefore, the current salary system is outdated and lacks external competitiveness, making it difficult to attract and retain talents.
(B) the separation of salary incentives and performance appraisal results
According to the enterprise's own situation, the organic combination of salary management and performance appraisal is conducive to tapping the potential of employees and giving full play to the best effect of salary incentive [1]. However, in the management process of AK company, there are some problems, such as salary management is not closely related to performance appraisal, and floating salary accounts for a low proportion in the total salary. The main reason is that the company takes equal pay for equal work as the salary design principle, which can't widen the salary gap of employees in Datong posts and reflect the different contributions of employees with different ability levels to the company. AK Company has formed its own performance appraisal system and standards. However, due to the imperfect appraisal tools and the lack of appraisers' ability, the appraisal results have little impact on salary and promotion, which leads to the phenomenon of "becoming a mere formality" in the performance appraisal process, which goes against the original intention of setting up floating salary projects, resulting in a great waste of company resources, an increase in internal friction and a decrease in overall operational efficiency.
(3) The salary promotion system is unreasonable, resulting in a career ceiling.
The glass ceiling is a metaphor, which refers to the intangible obstacles faced by female employees in enterprises who want to reach the top [2]. Although in previous studies, the phenomenon of "glass ceiling" happened to women, with the actual development of foreign-funded enterprises in China and the career development of local excellent employees, the phenomenon of "glass ceiling" also appeared. For example, AK Company is a vertically managed organizational structure with centralized management positions. Under this condition, most middle and senior managers are sent by the headquarters, and only a few grass-roots and middle-level positions are selected by local employees through recruitment, which will inevitably lead to the phenomenon that some outstanding talents apply for resignation after entering the company 1-2 years. Therefore, the reasons for brain drain include not only low economic reward, but also the failure of enterprises to formulate scientific and reasonable career plans for employees, and the single promotion path and route for employees. The above problems and reasons of AK Company can be used for reference to the salary management of foreign-funded enterprises in China, and the improvement measures and suggestions of AK Company can also be used for reference to the salary management of foreign-funded enterprises in China.
Three, AK company salary management of foreign-funded enterprises salary management inspiration
(A) establish a comprehensive salary concept, pay attention to the combination of internal salary and external salary.
The so-called total compensation refers to the systematic reward given by the company to individuals or teams who have contributed to the realization of organizational strategic goals. When setting up the salary system, we should pay attention to internal and external salary design, combine traditional salary items with new reward items, and formulate a comprehensive salary system according to the development strategy of enterprises. Like AK company, many foreign-funded enterprises are in a period of transformation, and they urgently need technology research and development talents and management reserve talents to maintain the long-term development of the organization. Therefore, under the background of fierce market competition, a systematic salary survey should be carried out, and the collected data should be analyzed scientifically and professionally to set the basic salary of each position, so as to improve the external competitiveness of salary; For internal compensation, we must first improve the working environment and office facilities, especially the introduction of high-tech equipment; Secondly, according to the ability level of employees, make personalized training programs to improve employees' various abilities; Then, regularly commend and reward outstanding employees, enhance employees' sense of belonging to the organization, and play an exemplary role; Finally, organize cultural and sports activities, tourism and other projects, strengthen the humanistic care of enterprises and communication with employees, form harmonious interpersonal relationships, and meet the psychological reward needs of employees.
(2) Increase the proportion of floating salary and promote internal fairness.
In the setting of floating salary, we should first increase the monthly or quarterly bonus, and combine employees' personal performance with salary [3] to achieve the purpose of short-term salary incentive. Secondly, it is necessary to make a profit sharing plan and strengthen employees' sense of "ownership". Enterprises should set the performance targets of each department at the beginning of the year and maintain certain flexibility. At the end of the year, the profit distribution ratio of each department should be determined according to the profitability of the enterprise and the performance completion of each department, so as to achieve the purpose of long-term salary incentive. Before this, enterprises need to streamline and optimize the original performance appraisal system, and use scientific and professional appraisal tools to formulate a new performance appraisal system suitable for enterprises. In addition, enterprises need to publicize the performance appraisal results and departmental performance results to ensure openness and transparency, and human resources departments should supervise and verify the whole performance appraisal process. In this way, not only can the enterprise continue to develop in an unfavorable external environment and increase its income, but it can also greatly improve the enthusiasm and initiative of employees, enhance the cohesion of the enterprise and ensure the internal fairness of compensation.
(c) Pay attention to the long-term development of employees and cultivate and retain talents.
According to Maslow's demand theory, enterprises make a scientific and feasible promotion management system for employees and tailor their career development plans to meet their basic needs and self-realization needs. Foreign-funded enterprises like AK can establish multi-channel promotion models. For example, for technicians, they can choose to develop technical routes or management routes. Enterprises provide employees with a variety of promotion options, which is conducive to maximizing the ability of employees, matching the most suitable positions, and creating more value for enterprises. In addition, enterprises should adjust their own organizational structure, appropriately increase organizational levels, reduce the frequency of using "airborne troops", and give priority to promoting internal employees when there are vacancies, which can not only shorten the running-in period for employees to adapt to new positions, but also let local employees see the career development prospects and reduce the turnover rate, which is conducive to the realization of organizational strategic goals.
[References]
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[2] Bai Donghong, Xinyuan Zhao, Fan Xinping. The "glass ceiling" of foreign-funded enterprises and the turnover intention of local employees: the moderating effect of variable career [J]. China Human Resources Development, 20 17, (04): 22-3 1.
[3] Chen Dan. Research on the causes and countermeasures of brain drain in enterprises [D]. Suzhou: Suzhou University, 20 16.
Author: Zheng Xue, Zhang Peng Setting: School of Management, Liaoning Normal University.
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