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recruiting employees in China

Podcast transcript #36: All you need to know about recruiting employees in China

Find here the full China paradigm episode 36. Learn more about Jenny Shi’s story and how her company is recruiting employees in China and find all the details and additional links below.

Full transcript below:

Matthieu David:  Hello everyone. I am Matthieu David, the founder of Daxue Consulting and this China marketing podcast, China Paradigm. Today, I am with Jenny Shi. You are the founder of Uniway Recruitment and we know each other from an organization called EO, Entrepreneurs’ Organization.

You created your company a few years ago, and before that, you had extensive experience in different foreign companies in different countries. And now, you are supporting the Chinese recruitment industry. Do you want to tell me if you like the word “headhunter in China?” Some people don’t like it because it’s too aggressive. But you’re not providing HR services in China, it’s a bit more than headhunting in China, as far as I understand, and about advising for careers. It’s about the recruitment process in China and finding job candidates in China. In terms of clients, you have very large companies like Siemens, Sisley, Discovery Adventure Park, etc., one Chinese. Why is there only one Chinese client in the Chinese recruitment industry? You are going to recommend service in most of the big cities in China, Beijing, Suzhou, Hangzhou, Shanghai. My first question is, could you give an idea, to the audience, of where you are in terms of development? It could be the number of equipment, revenue, the number of clients you’ve got or the people you interviewed. What is the size now of your headhunter in China? 

Jenny Shi: Thank you for your question. It’s a pleasure to speak with you as well. I embarked my entrepreneurship in China basically three years ago. Over the past three years, we have accumulated about 25 clients of both Chinese companies and overseas companies from Europe and the U.S. Frankly speaking, the majority of our clients are from Europe countries like France, the Netherlands, and the UK. Currently, we’re also growing our client base with more Chinese companies, due to their needs for headhunters in China. For instance, in the past six months, we have acquired five new local Chinese companies that are growing with huge potential. The majority of them come from E-commerce in China. Currently, we are still a small team with five full-time consultants. We are aiming to double our team members by the end of this year.  In terms of the growth rate, from 2017 to 2018, our revenue growth rate is about 33%. And we are aiming to maintain at least this growth rate this year or with a little bit of more aggressive progress. 

Matthieu David:  Talking about the Chinese clients, in your presentation, you’re mainly talking about VIPABC, now called Tutor ABC, the only Chinese client you mentioned. When you work with the Chinese clients from E-commerce, are they recruiting job candidates in China for global expansion or for local managers? Because your key asset and positioning have to be international, to be able to recruit employees in China for foreign properties in China or to be able to bring in international talents in China for Chinese companies. Could you tell us more and if you see something happening with local companies recruiting international talents in China?

Jenny Shi: In terms of client acquisition, we don’t have any preference for either Chinese or Western companies. It’s mainly due to the needs of the Chinese recruitment industry. The Chinese recruitment industry is very much a relationship-based business. Last year, we got 77% of clients referred by our previous clients. If we have already a very big base of European companies, then it’s very natural for us to get more referrals from that side. VIPABC is actually the first client that I worked with for the first year when I found Uniway Recruitment. In terms of the methodology of working with the companies, it was not much different. It doesn’t matter if the client is a Chinese or Western company. It’s just probably the needs of recruiting employees in China. The direction of the selection is slightly different. For European companies here in China, they are targeting bilingual job candidates in China, while for local Chinese companies, sometimes they don’t have the language requirements. It’s mainly focusing on the qualification of the technical side. That’s probably the difference. 

Matthieu David: 
You mean when you work with Chinese companies, you are working for the local market, right? 

Jenny Shi: Yes. 

Matthieu David: How do you explain that European clients are most of your clients? Does it mean that they are more used to outsourcing the hiring process in China by partnering with a headhunter in China? How do you explain that? 

Jenny Shi: Basically, people come to a headhunter in China for a couple of reasons. First of all, they may not have the right type of resources for recruiting employees in China. Secondly, they want to save the time or hiring process and improve efficacy. The third one is enjoying the HR service in China, to share the industrial language of hiring process in China and marketing intelligence of the Chinese recruitment industry, because, for headhunter in China, one of our benefits is that we are not just talking to one or two companies, but to all the competitors of our clients. In this case, we are able to offer them the marketing intelligence, including the compensation benefits system of their competitors, the directions of the job candidates in China, where they’re working and why they are choosing certain specific companies. This knowledge is very important for our clients. For instance, if they already have the information of the compensation benefits structure of other competitors, it is going to be very useful for them to define or have the trust of their own compensation or benefits structure to attract their target job candidates in China.

Matthieu David: But you have a problem of working for competitors. Some advertising agencies will not work for one car maker and the other one. They have to choose one or another, or the clients have to choose another agency that is independent to have only one of them. Are your clients taking the fact that you are probably working with their competitors or people in the same field as an advantage or as a risk?

Jenny Shi: If we analyze our successful placements for our clients, the job candidates in China are mostly from directly-related industrial backgrounds. They work for the service fee because that’s social hire. The client wants to utilize the experience of these job candidates in China directly, instead of spending two, three, four years to train them. That’s the majority of the cases that we work on. The headhunters in China want job candidates in China with experiences. Of course, there might be issues involved in the candidates’ sides if they choose to work for the competitors because some companies will have a very strict non-disclosure agreement included in their labor contracts. But this very much depends on the previous company of the job candidates in China, if they’re very strict on the agreements of not working for direct competitors or not. The solution could be case by case. 

Matthieu David: Is it picky as other industries on the hiring process in China?

Jenny Shi: I wouldn’t say all our clients are very picky when it comes to choosing the right job candidates in China. They all want the best job candidates in China from the Chinese recruitment industry, the top 20% of the candidates because that’s what they pay for. They pay for recruitment services. 

Matthieu David: You said that referrals are a big driver for your growth. Do you think there is a bit of scalability in referrals?  Do you think there is something you can build in order to speed up the referrals with more clients to you from your past clients? I am sure you have thought about the scalability of this way of getting clients. Have you found something which works?

Jenny Shi: A plan to refer is very effective. For instance, we used to work with the AXA group, one of the biggest French insurance groups in the world. The client was very happy with our service and then he referred all companies under the AXA Group in China to us. It’s very effective because it’s a warm and trustworthy introduction from the existing clients. That’s also one of the strategies for us to gain more clients, by referral. 77% of our existing clients were referred by our past clients because they are happy with what we have done for them. Therefore, our mission is very simple, which is to help our clients improve the efficiency and quality of their hiring process in China. Once we can achieve that, then we make sure our clients are happy. They are happy to refer clients to us as well.

Matthieu David: Referral is a bit random. Do you think it’s possible to systematize referral? Is it to meet with them every month to make sure that they have thought about new opportunities for you? Is it to interview them on video or to make them talk in a conference you organize? Have you thought, found, or thought about the way to leverage these referrals? For Daxue Consulting, it’s very random when people recommend us. One time, it happened on a plane. We were asking one client how they knew us. He said it was from someone next to him on the plane. They were talking about market research in China and consulting in China. The other one said, “Daxue Consulting. Work with them. They are pretty good.” And we got a referral. But how can I scale that? Is it a concern for you or you are already pretty happy by the fact that it’s random?

Jenny Shi: I share your pain and also, your experience as well. For us, we have externalized clients’ screening process as well, the same as when we are screening our candidates. For us, one of our core values is quality, the quality of clients as well as the quality of the candidates plus the quality of our work. We do a pre-analysis of the clients and ask a lot of questions including their vision, strategies, business model, what type of job candidate in China suits them best, and if they have very scientific talent management process in position. Also, we do financial background checkup as well. So, it’s not like random. We analyze which clients to work for. We are very careful and selective. 

Matthieu David: 
Talking about the quality of clients, I thought about Glassdoor. I also thought about what people think about the company culture in China online. Are you using technology for recruitment in China like Glassdoor or LinkedIn? I believe it’s already frequently used. What kinds of other technology for recruitment in China do you use to assess the company, find and assess the job candidate in China? In the West, I believe LinkedIn has got a large space in the industry. There is also Glassdoor with a lot of growing companies on it. What about in China? Do you have equivalents or the same websites? Do you use any online technology for recruitment in China? I’d be very interested to know. 

Jenny Shi: In terms of the candidate sourcing channels, there are a lot in China like in every other country. LinkedIn is a global channel for recruiting employees in China. Locally, we have Liepin for the middle to senior positions. For some other Internet-based companies, they use Lagou and Boss Zhipin. I think you may have heard about them. For the senior positions, we have 51Job and Zhilian Recruitment and so on. More and more social media channels are coming up, for instance, all the WeChat groups and online channels for recruitment as well. But frankly speaking for our business, we’re pretty much focusing on the middle-to-senior-level positions. We use quite a lot of our own database that we have accumulated in the past couple of years as well as LinkedIn and Liepin. Most importantly, we spend a lot of time talking to the people in the industry and asking for referrals. It’s a very much a time-consuming job because we have to qualify the job candidates in China. We make sure the job candidates in China are in good quality because we think only qualified job candidates in China will be liked and selected by our high-quality clients.

Matthieu David: When you say you are pitching senior people, does it mean that it’s only C-Level? Then, you don’t need to go on LinkedIn. It’s only going to the website of the company or by talking to the competitors and reaching out to see the competitors of similar companies? Is it the reason why you don’t really use LinkedIn because you know it’s a C-Level? Is it what you mean? 

Jenny Shi: For hiring C-level job candidates in China, frankly speaking, we would say referrals will be much more useful than reading the messages on the website because they don’t usually apply for jobs or open channels as well. So, it’s all done by referral or the previous database. 

Matthieu David: In your presentation, I saw that you are able to find and give answers within 48 hours and complete the hiring process in China within four to eight weeks, which is really fast. But based on the fact that when someone wants to leave a position, they have to give a one-month notice. How does it work? How can you be so fast in recruiting employees in China? 

Jenny Shi: The Chinese recruitment industry is very competitive. It’s like a red ocean business. The quality and speed are very important for us to be competitive in the talent market in China. The reason why we are able to shortlist candidates within 48 hours is that we have an existing database tool for recruiting employees in China. We know the job candidates in China over the years. It’s already a well-established relationship. At the same time, our team is very committed and dedicated once we commit to working with the clients. So, it’s an internal requirement as well. In terms of the cycle of replacements, four to eight weeks is historical data. For our replacement, it’s also our internal requirement, because we need to make sure the placement is efficient with quality. Plus, it’s also internal management, because as a consulting service, we need to calculate our fees by hour or b day. It’s very important for us to make sure our cash flow is very healthy. If we finish one placement for three or four months, it’s going to be very hard for us to make any profits. But if the position is very senior like the executive, director, or vice president level, then it allows us to have more time. That’s a different case because right now, the majority of our target positions are middle to senior positions. For instance, the senior manager is a position with salaries of around 500K to 800K and the timespan of replacement is two months maximum. If it’s over two months, it’s very nervous for both us and our clients. 

Matthieu David: You wrote on your PPT that your fee is 25% of the annual package, right?

Jenny Shi: This is really transparent in the Chinese recruitment industry right now. We propose a contingency as well as a retainer-based search. Sometimes certain clients will be able to also accept a retain. Normally, the fee is going to be a three-month salary of the candidate. And this is quite transparent in China.

Matthieu David: Three months equal to 25%. One month salary is 8%, so basically 25%.  It’s pretty transparent and everyone has the same metrics and standard on charging. 

Jenny Shi: Yes. 

Matthieu David: I want to go back on the technology for recruitment in China. You said that you use Liepin, Lagou, and so on, depending on the industry whether it’s tech or non-tech. We talked about LinkedIn for the global profile. You didn’t mention any website that is also helping you to understand the company culture in China like Glassdoor. Do you have similar websites that help you in China to frame the company, to know if the company has a good reputation? What website would you use? 

Jenny Shi: Right now, in China, we have a pretty new website, called Qichacha. It’s to check the background of every registered company. We can go through to see if there is any lawsuit involved with the employees. Everything will be recorded in the system, which is transparent to everybody, talents, and suppliers. But for us, the beauty is we have a wide connection of people, of talents, of clients. It’s very easy for us to do a quick reference. On top of that, of course, we visit every single client to also ask questions to qualify them based on our experiences as well. Once we have a long-time accumulation in the industries, we will be able to easily reference-check on the companies.

Matthieu David: We talked about the company culture in China. We saw the news of “996” in China that you work from nine to nine and six days a week. Is it currently in the Chinese recruitment industry? Is it common for you to see online, from your job candidates in China, or from the companies? Is it a standard in China? Is it something that job candidates in China don’t want, so they will prefer places with company culture in China that respect their life? What’s your feedback on this? Actually, companies can’t tell you if it’s real or not.

Jenny Shi: That’s a good question because it’s a hot discussion on the Internet right now in China. I will say this is very much limited to Internet-based companies like E-commerce, but not the traditional companies at all. It’s a very company-by-company practice. For instance, for us, we’re not encouraging 996 working hours as well. It’s crazy. A lot of issues will come with job candidates in China. The E-commerce platform, for instance, is pretty much 9-9-6 working hours. And sometimes, it’s even worse. This is one of the reasons why job candidates in China will like to switch platforms.

Matthieu David: To switch to another industry, not to be in the tech industry anymore. And you see that in your environment?

Jenny Shi: Yeah, based on the interviews with job candidates in China in the E-commerce platform.

Matthieu David:  Talking about online technology for recruitment in China. You talked about Qichacha, a Chinese website where you will be able to check more official information, not really reputation actually. How do you build your own database? Is it one by one when you meet with job candidates in China? Do you extract data from other technology for recruitment in China? If you have to input all the names, it’s a very painful and long work. How do you work to build this database?

Jenny Shi: Firstly, what you mentioned is one of the technology for recruitment in China we used. It’s quite traditional and not very efficient. At the same time, we do data acquisition for recruiting employees in China. We also invest in the data acquisition from different technology for recruitment in China as well by checking the quality of the database.

Matthieu David: So, you can buy a database. That’s what you are saying. 

Jenny Shi: Yeah.

Matthieu David: Interesting. In your presentation, you mentioned the key account management model. What do you mean by key account management model? Key account, for me, is kind of a position like a key account manager. Is it a business plan in China? I am surprised to use it as a business model. Could you explain more?

Jenny Shi: For us, I believe to successfully run a business, I personally like to use the 80/20 rule in business, because I think that 80% of our revenue comes from the top 20% of the key accounts, which means we have a lot of clients, but not every client is a key account. We define a key account as a client who values our service pretty much and forms long-term, stable cooperation with us to ensure the cooperation is long-lasting with quality and commitment from both sides. Normally, we make more profits and revenues from those clients. During the whole hiring process in China, we also put a very significant amount of time and efforts to maintain those kinds of clients in order to grow with them.

Matthieu David: So, building a relationship is dedicating to clients so they can understand the job candidates in China very well and come back to you even if they have no business, but just to share ideas and what’s going on in the company. Key account management is to go into the company and understand it as if it was used to be able to build a strong relationship. That actually links to another question I had. It’s about company culture in China. For example, it’s quite easy to know if someone can use Excel VBA. You can test their knowledge. But the difficult part for every entrepreneur in China who had an experience of recruiting employees in China is whether this job candidate in China fits in its company culture in China. Will they fit in the organization with the way they interact with people? Is this person too aggressive or not aggressive enough? Is this person an introvert, not introvert enough and so on? Do you have a process? Since you are aligned with your client, if the job candidate in China is leaving because they don’t fit culturally, you have to find another job candidate in China again without any profits. So, you have to know about the company culture in China. How do you assess company cultures in China.? It’s so hard. 

Jenny Shi: 
Alright. This is a very, very interesting topic for recruiting employees in China. Before I answer your question, I would like to also share some data. According to a Hays survey last year, basically 43% of the candidates leave a company because of cultural fit issues in the workplace. It’s a significant issue when it comes to mismatch. So, we place significant importance on cultural or value match while recruiting employees in China. When we visit our clients, before we actually do the job debriefing, we talk about the fit of company culture in China as well. We will specifically design a set of questions to define if they have a very solid company culture in China or core values or not. This is one of the criteria for us to select clients as well. Once they have a very satisfying answer on this one during the process of selecting job candidates in China, we will align with our clients a set of questions to evaluate if the core values fit. We don’t do this alone as an agency. We work very closely with our clients, with CEOs, with the decision makers to finalize this specific topic, because, frankly speaking, it’s a little bit abstract in terms of qualification in the technical fields. On our own side, we also have tools to test the personality of job candidates in China like logical thinking requested by our clients. For senior-level job candidates in China, we even do testing by new technology for recruitment in China that we created. We show them 20 to 30 pieces of artworks to know the person because we believe the artworks themselves are effective. Once people answer our questions, it’s a subjective reflection of who they are. We found this very interesting and helpful. We will write up four pages of reports to our clients of our observations of the job candidates in China because this can help us remove our own subjective judgments prior to reading their CVs, which we found very fascinating and very effective as well. 

Matthieu David: I know a company that asks a candidate to write a letter with a pen to understand the writing of the candidate and to understand his personality based on the writing. I read the feedback and it was pretty direct in saying that he’s very driven, ambitious, but he’s going to do whatever he wants based on his writing. He’s someone who is very social but actually doing to do what he thinks is good, even if it’s nice to hear. Do you use hot words? What is common in the Chinese recruitment industry to assess the character of job candidates in China? Is it the writing, questioning or software? I know a software called Predictive Index. You have to actually answer two questions, what do you think of you and how do you qualify yourself. You click on the word that corresponds to your answer. What have you seen in the Chinese recruitment industry in order to assess the personality of the job candidates in China? Not the skills, because the skill is actually the easiest part. Artwork? 

Jenny Shi: There are different types of personality evaluation tools for headhunters in China. The traditional and famous one, for instance, is called the DiSC that most clients pay for after the candidates go through the test in order to get the job. This is also a scientific personality test or psychological test to understand the personality of the job candidates in China. It’s a very common technology for recruitment in China for multinational companies to use when they are recruiting employees in China. For us, we actually created something new on our own. It’s also because I am interested in art myself. One of the core traits for senior-level job candidates in China is to be very creative and able to solve problems with different solutions. That’s why we use artworks to see how creative they are and how many dimensions they are able to answer the questions. Frankly speaking, based on the historic tests that we did with our job candidates in China, we found almost 82% of the management-level job candidates in China have something in common. They are able to see both the details and the big picture of the job candidates in China. They are able to describe them in a specific way, which is fascinating. For instance, also for the majority of executive assistant type of job candidates in China cannot really focus on the big picture, because the job itself is very much detail-oriented. So, when they answer the questions, they focus more on describing the details of each job candidate in China.

Matthieu David: Very interesting. How did you build this method? Where did you get inspiration? Did you read books?

Jenny Shi: We basically did a lot of tests and then we found a common result. Then we do the statistics to prove if the major trends are similar. This is not practiced by any other companies by now, I guess. 

Matthieu David:
Talking about a bit more theoretical way of analyzing someone or maybe more sophisticated than just occasionally checking the skills, would you have some books or some resources to suggest on how to run an interview or how to assess the personality of someone? You mentioned the tests before, but do you have any books you feel are useful and especially work well in China? 

Jenny Shi: I wouldn’t say specifically in China, because, by my experience, when it comes to assessing candidates, it’s global. It’s universal and similar. If I need to recommend a book, I would say “Topgrading”. It’s a good book to follow. The methodology is very scientific, but it takes a long time for employers to go through the whole methodology and there are quite heavy interviews of two to four hours about the patterns to find the consistency in the job candidates in China. 

Matthieu David: What would you suggest a company or an entrepreneur in China do when he is managing his company? Do you have some tips on managing people in China? Take me as an example. I’m doing interviews with job candidates in China every Tuesday afternoon, even when we don’t need to recruit employees in China immediately, I interview potential job candidates in China who apply on our website to be aware of them. Sometimes you create a position because there is a good job candidate in China and not necessarily because we need it immediately. The other reason is that maybe you may need to recruit employees in China in months so it can be good to initiate a relationship. That’s one advice I could give to someone who is asking me how to be successful in recruiting employees in China. Would you have other tips to share on recruitment besides to work with you of course, but on managing human resources and also recruiting?

Jenny Shi: What you did is very important because we believe recruit employees in China is not an event, but a process with continuous efforts and consistent actions. It’s very important to have the desired result. For companies, especially fast-growing ones, it’s always important to have one or two persons to be very consistent in the hiring process in China to build a pipeline of internal talents. It’s not only limited to fast-growing companies, but also for well-established companies. The reason I’m focusing on fast-growing companies is that we are all entrepreneurs in China. Normally startup companies lack a very strong branding in China.  It makes it even more difficult to attract good job candidate in China. That’s why we need to have a very strong pipeline. When the job candidate in China leave the company or something happens, you have a very good solution to solve the problem, instead of being in a situation that you don’t have a job candidate in China to fill the position for six months or a year, which can create a big damage to the business. Other tips that I can give on how to recruit employees in China is first off, there are a few questions that we need to answer as the owner of the companies. 

First of all, who are our target job candidates in China? I think it’s very important for us to define our talent selection criteria and who suits us best at this stage of the business. We hear a lot of owners and CEOs talking to us, “Jenny, we need the best job candidates in China or A-Players in the Chinese recruitment industry.” Frankly speaking, every company wants to attract the A-Players and top job candidates in China. But the question is if they’re suitable for the business or at this stage. That’s why we need to ask ourselves if it’s the best suit. The organizational self-awareness is very important as well. And this is related to the company culture in China and the working system. So, we need to have a very clearly-defined company culture in China as well as the whole talent management system to maintain the talents. 

The second question is where our target job candidates in China are and who they are working for right now. This is a direction for us to maximize our talent sourcing channels. For certain talents, we are sourcing in different ways. It could be from a headhunter in China. It could be a referral. It could be job advertising through the target channels. That’s why it’s very important for us to know where our targeted job candidates in China are. 

So, the third one is how to evaluate and attract job candidates in China. We always need to find our ways to attract good job candidates in China. Question number three is how to evaluate, attract, and talk to job candidates in China. Once we are clear of who we are as a company, it’s very important for us to have a very professional screening process to make sure we have the right tools in position to evaluate the job candidates in China on what we want based on our talent selection criteria. 

To attract talents in China, according to the statistics that we have, there are mainly two reasons for talents locally to leave their jobs. The first one is the misfit with the company culture in China, which means they’re not very happy with their line managers or the working system. The second one is they are not very happy with their package or salary. Up to 70% of job candidates in China leave their jobs for these two reasons. The business owners and line managers need to bring these into consideration. During the interview process, it’s very important to also identify what job candidates in China are looking for, what motivates them most, why they want to switch jobs, and why they are specifically interested in your company. Questions like these are very important. 

Number four is, once we successfully attract the candidates and introduce the candidates to our company, how to retain job candidates in China? We will suggest all the companies to have a strategic talent management system in position. This one links to the monetary and the non-monetary rewards system, meaning compensation benefits system is not just about money. It’s also about non-financial tools to recognize and reward job candidates in China in different ways to pay attention to their personal development, instead of only their professional development. On top of that, the whole company, HR professionals, co-owners, line managers, all need to work closely together to retain the talents by making sure that they feel happy to come to work every day. Of course, this is a continuous effort. 

Matthieu David: Do you help your clients on this side?

Jenny Shi: It depends on what type of clients they are. Normally for the fast-growing companies with a solid compensation benefits system, we will additionally provide consultancy service to make sure that they are aware of the importance of designing the system. In addition, even before they start to recruit job candidates in China. Because during the interview, it’s also very important to make sure the job candidates in China know how they will develop after joining the company within the next five years. 

Matthieu David: 
You mentioned in your presentation under your company logo, “Your Reliable Partner in China.” The word you chose may mean that there are many other headhunters in China that are not reliable. Could you tell us what is the current status of the Chinese recruitment industry? What would be an unreliable headhunter in China? What do companies have to be aware of as a company when hiring a headhunter in China? How to avoid unreliable ones?

Jenny Shi: The quality or standard of headhunters in China is not very consistent. There are bad recruiters in the Chinese recruitment industry and also, there are excellent onesIt’s the reality of this Chinese recruitment industry. This is one of the reasons why I created Uniway Recruitment three years ago because we want to make the Chinese recruitment industry to be more reliable based on my own observations in the past five years before I started my own company. For us, our definition of being available is being reliable. It’s being very accountable and committed. We follow through the whole hiring process in China from the moment we make a commitment to our clients. After we successfully place the job candidates in China, we also follow through the whole probation period of probably three to six months to make sure the placement is solid and the clients are very happy with our job candidates in China. For instance, two months ago, a French logistics client came to us saying that they’re not very happy with their existing headhunter in China because the consultant does not even evaluate the job candidates in China. They just send 50 job candidates in China without even telling them which ones are the target job candidates in China. This kind of headhunter in China does not really help the client save time and improve the efficiency of recruiting employees in China. 

That’s why we define our mission to improve the efficiency of recruiting employees in China and also save the cost for our clients. It really saves our time of replacing job candidates in China. and the cost. Our company very much focuses on the timespan as well. The shorter, the better. That’s why it requires us to spend a lot of time to really understand what our clients need. We ask a lot of questions to define before we send out a shortlist. We don’t really shortlist a lot of job candidates in China. Instead, we shortlist the most qualified job candidates in China. So, we actually close the position within only two weeks’ time for shortlisting four job candidates in China so that one of the four candidates can successfully close the bid. 

Matthieu David: For you, a headhunter in China which is not reliable will be a one that is sending too many job candidates in China without screening and wasting the time of the clients. That would be your red flag. Do you have other red flags when choosing a headhunter in China?

Jenny Shi: Some of them are not following through. I think the Chinese recruitment industry is naturally about sales. After-sales service is very important. And for us, we are focusing a lot on the quality of service, which means we place significant importance on the experiences of both job candidates in China and the clients with us through the first touch point. We make sure that we provide consultancy service to both job candidates in China and the clients during the whole hiring process in China. They are enjoying the best of professional service from us. We make sure we answer the questions to both the job candidates in China and the clients in a very professional way and they benefit from us not just from their job or from their job candidates in China, as well as the access to the information on how to prepare an interview, how to recruit candidates, and how to retain clients. 

We also give directions and suggestions to job candidates in China on how to select a job and how to select a company, which is most suitable for them. Both ways are equally important for us to make sure the job candidates in China are happy with the job and the clients are happy with the job candidates in China for long-term cooperation. For instance, because the companies are so big that they have so many consultants working on the commission-or-fee-based structure. If they are not hitting the target, the companies will wipe them out within six months’ time. A very bad experience for clients—actually, many clients have this type of feedback—is after three or six months, the person we chose is not working for the company anymore. We have to deal with another contact window. It’s kind of wasting time for the clients as well. For us, we are a boutique firm and we are very committed. We have a very stable team and we make sure the team serving our clients really well in the long term. I think this is another difference that we can make among our competitors in the Chinese recruitment industry.

Matthieu David: Do you see a risk with a company working with a headhunter in China and then this headhunter in China will actually in some way resell the profile to another competitor two years after they placed somewhere? Have you seen this practice?

Jenny Shi: This exists in the Chinese recruitment industry, but in our company, normally, the common practice is that the headhunters in China will sign a contract with the clients and they’re specifically saying a few things. 

Number one: During the hiring process in China, if we place these job candidates in China to your company, we will not shortlist the job candidates in China to another company or a competitor at the same time.

Number two, we also have a specific clause saying within a certain period of time, 2 or 3 years, we’re not going to be approaching the job candidates in China for another job. For us, we think it’s neither professional nor ethical. 

On top of that, our company actually signs an agreement with our placed job candidates in China saying you should not approach us as well within 2 years for another job. We are very strict on professionalism and we know not so many companies in the Chinese recruitment industry doing this.

Matthieu David: More and more people are choosing to be independent freelancers to work on their own or to work from home. In the U.S., the number of freelancers is very big with 36% of the workforce. The number depends on the industry though, but it’s sizable. Do you feel that the future of headhunters in China would focus more on the freelancing function that you can work with someone internalized or with a company, instead of purely recruiting employees in China? Do you have companies that want to recruit employees in China but tell you as well, “I can find a freelancer. I can find someone outside your company who is working from home?” Is it something you have seen or it’s not the case yet? 

recruiting employees in China

Jenny Shi: With my observations, there are people doing this right now. It’s possible. For instance, if a consultant has been working in the Chinese recruitment industry in a very specific function for ten years, only recruiting lawyers, it’s very possible because he or she may know thousands of lawyers in the talent market in China and it’s going to be very fast for them to place the job candidate in China. If it’s freelancing, it means it’s less strict. It’s not organizational behavior. If something happens to the client, it will be very difficult for them to trace, because if the consultant is freelancing, he or she doesn’t have the proper license or register a public company. He or she even has issues with income. So, I would not really suggest professional companies to go for freelancers. It’s risky to hire freelancers. From our experience, most of our finished projects are based on very close teamwork.

Matthieu David:  The other way around is you have a client who is looking for a senior designer in their company, but actually, you find out that a job candidate in China who could fit better could be a freelancer. Does it happen sometimes that you see some job candidate in China who say, “I am happy to change my job, but I like to work from home or I like to be a freelancer?” We talk about this economy where people want to work from home and have a work-life balance. They want to be a freelancer, and then you could take your 25% commission at the same time. It would be very similar, but just the contract between your client and your candidate would be different. Is it something you have come through? 

Jenny Shi: For our business, we have not really worked with freelancers or placed any sort of freelancing position. Not yet, but we have interviewed a sizable job candidate in China, especially in designing or management positions as well as for an advertising company like Account Directors. It’s very common on their resumé, working one or two years as a freelancer their own projects. So, there is a sizable job candidate in China out there with very specific job functions and not for all the functions. The reason is we just place full-time positions. 

Matthieu David: Are there any companies or clients saying that “I’m open to having someone in my office or outside my office?”

Jenny Shi: Some companies want freelancers for specific reasons, but our response usually is we don’t do.

Matthieu David: When you explained, actually you mentioned you need a license to recruit employees in China. Do you need a license to be a headhunter in China?

Jenny Shi: The company needs a license.

Matthieu David: A specific license or it’s just the scope, a business scope? 

Jenny Shi: Of course, you need an HR license to allow you to do a recruitment business. Yes. 

Matthieu David: 
But it’s a business scope, right? It’s not a specific license like selling on the Internet where you need an ICP and so on. It’s in the business scope. 

Jenny Shi: It’s in the business scope. 

Matthieu David: Okay. Thank you very much, Jenny. It’s already one hour. It goes fast. And I hope you enjoyed it and I hope everyone enjoyed the talk. How did you like it? 

Jenny Shi: I will say thank you very much and I really appreciate these chats. Thank you for having me for this interview. I hope it’s going to be helpful in the entrepreneurship proposals. 

Matthieu David: I’m sure it is. Congratulations on what you did and thank you, everyone, for listening. Bye-bye. 

Jenny Shi: Bye. Thank you.

China paradigm is a China business podcast sponsored by Daxue Consulting where we interview successful entrepreneurs about their businesses in China. You can access all available episodes from the China paradigm Youtube page.

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