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China faces
a critical shortage: experienced, highly skilled managers. The numbers
are huge. The country has some 25,000 state owned companies, 4.3
million private firms and massive industrial overcapacity. But it has
too few experienced managers for even the elite firms. The consulting
firm McKinsey & Co. estimates that even the relatively small number of
Chinese companies trying to expand abroad will need up to 75,000
internationally experienced leaders if they want to continue to grow
over the next 10 to 15 years. Currently, McKinsey estimates, there are
only 3,000 to 5,000 such men and women in China. "The speed of market
change, foreign markets and internal markets, all those things are
really becoming much more complex than even a couple of years ago.
People on the ground haven't experienced those kinds of complexities."
The leadership chasm is not often cited as a hurdle for China's raging
economy, but it could become one. Most foreign companies need to hire
local talent to help them navigate the local market. Chinese companies
could hit a staffing bottleneck in their effort to compete with Asian
rivals in increasingly sophisticated markets. China's main competitor
in Asia, India, has a class of CEOs far more experienced and worldly
than the Middle Kingdom's.
Fast change isn't the only reason for the talent gap. Though the
private sector now accounts for a third of the Chinese economy, many
Chinese managers continue to run their companies according to the
rules and traditions of the planned economy—in which firms produced to
meet a quota, not consumer demand, and kept books that shed no light
on profits. The talent pool was also severely depleted during Mao
Zedong's Cultural Revolution, which interrupted the education of an
entire generation. Many people who came of age in that era never
caught up. In a government-sponsored survey of 5,000 CEOs and
chairmen, only 40 percent said they had attended college. Of those,
only 20 percent received management degrees. "In China, we are far
behind the world in science and technology, but even farther behind in
terms of management," says Zhao Chunjun, dean of the Tsinghua School
of Economics and Management in Beijing.
Many managers are trying to adapt by going back to school. Demand for
M.B.A.s has risen sharply. In 1991, when the Chinese government began
licensing M.B.A. programs, there were nine. Today, 95 schools offer
them, and they are scrambling to modernize. Many team up with Western
universities, flying in professors—or sending their own abroad for
retraining. Tsinghua University and others now offer an executive
M.B.A. program for more-senior managers who want to go to school part
time. Prestigious Beijing University now runs the Beijing
International M.B.A. program, which accepts about 250 students each
year and offers classes almost identical to those taught in the United
States. |
