Thesis cusotomized service modification sample

The  research on human resource management of SMEs in China.

Thesis cusotomized service modification sample

The  research on human resource management of SMEs in China.

Chapter One Introduction

1.1 Background Information

Upon the background of economic globalization, the enterprises have to operate in an increasingly complex environment and have to face more intense competition that is not only the domestic market but also from the global market. In the past, the competition between enterprises is mainly focused on the traditional 4Ps such as product, price, promotion and place. But with rapid development and the intense competition in the market, these aspects have become gradually similar to the enterprises in the same industries. So the emphasis of the competition between enterprises has changed from the traditional 4Ps to other key aspects of the enterprise such as internal management.

Internal management has been an important issue to the development of the enterprise and it has been one of the key factors to influence the success of the enterprise in the market, because it is very important to improve the efficiency of the enterprise through effectively managing various kinds of resources of the enterprise (Mathis and Jackson, 2006). Generally an enterprise has many different resources such as raw materials, technologies, brand, channels and human resource and so on, and these resources have the important effect on the operation and performance of the enterprise.

According to Storey (2007), humans are an organization’s greatest assets, and everyday business functions of an enterprise such as managing cash flow, making business transactions, communicating through all forms of media and dealing with customers could not be completed without humans. So the management of human resources plays an increasingly important role in the enterprises. Human resource management (HRM) is responsible for how people are treated in the organization, and it is not only responsible for bringing people into the organization but also responsible for helping them perform their work, compensating them for their labors and solve problems for them (Storey, 2007). Generally HRM includes five main functions of recruitment and selection, training and development, motivation and performance appraisals, compensation and benefits, and employee and labor relations (Mathis and Jackson, 2006).

The development of HRM practices in China is behind the development of them in the western developed countries, and most of Chinese enterprises haven’t paid enough attention to the issue of human resource management (Pieper, 2000). But with more and more Chinese enterprises joining into the competition of the global market, they begin to realize the importance of human resource management. Many Chinese enterprises learn from international literature of HRM and try to apply international HRM theories and models in their operation and management in China. But this many face many problems because of the different environments and cultures in China so that it is important to find out the suitable HRM models and strategies to the development of Chinese enterprises (Pieper, 2000).

In the past, people generally pay attention to the operation or performance of large enterprises such as multinationals especially under the background of economic globalization. But in recent years, the development of small and medium-sized enterprises (SMEs) has attracted more attention from the society and much research has been done to investigate the aspects relating to the development or performance of SMEs because of the increasingly important role of small and medium-sized enterprises in economic development (Fernandez and Nieto, 2005).

Although in most countries, large enterprises generally play an important role in economic development, SMEs have been an essential component in the national economy of many countries. Compared with the large enterprises, SMEs have many advantages such as flexible operation, easy to adapt the change of the environment, and innovations; but they also have some disadvantages relative to large enterprises in resources and capabilities, management, talents, governmental support and technologies (Luczka, 2004). With the rapid development of SMEs, governments in many countries have gradually realized the importance of developing SMEs and adopted some measures to encourage the development of SMEs because governments know that SME is a phase of development of the enterprise and the emergence of the large enterprises is based on the development of SMEs (Laforet and Tann, 2006).

Similar to the status in many other countries, national economy of China is also dominated by some large state-owned enterprises. These large state-owned enterprises play an important position in the different industries of China and are supported by the government of China, while the development of SMEs has to face many difficulties compared with these large state-owned enterprises in China. But with the implementation of market economy and reform of state-owned enterprises, China’s government has greatly reduced the intervention on the behavior of enterprise. Upon this background, private enterprises are encouraged to develop. This greatly drives the development of small and medium-sized enterprises in China and SMEs are playing an increasingly important role in many industries of China (San and Zhu, 2003).

With the support and encouragement of the government, SMEs have achieved rapid development and growth in China and they have played an increasingly important role not only national economy of China but also in the society of China. But SMEs in China also face many problems during the process of their development such as strategic management, internal management and human resource management. With more and more Chinese enterprises including SMEs beginning to go international and Chinese market becoming more open to foreign enterprises, there have been higher requirements of the development of SMEs in China. These issues of strategic management, internal management and human resource management have been the important factors to limit the development of SMEs in China.

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Although human resource management is not a new issue to most of enterprises in China, most of Chinese enterprises, especially SMEs, haven’t realized the important role of human resource management in their development and attached enough importance to this issue in their enterprises. In order to achieve the rapid growth, most of SMEs in China pay attention to production, sales and marketing, ad neglect the issues relating to management. In their opinions, the competition between enterprises is mainly focused on product, price and marketing, and human resource management is not an important issues to influence the competition between enterprises. But in fact, human resource management has been important for enterprises in the western developed countries, so it is meaningful for the author in this research to investigate issues relating to human resource management of SMEs in China.

1.2 Intern Company and Problems

I work in the human resource management department of Ken Bang Business Investigation Company during the period of internship. Founded in 1998, the headquarter of Ken Bang is located in Beijing City of China and the company has many branches in main big cities of China such as Shanghai, Guangzhou, Shenzhen etc. The main business of Ken Bang is to provide business investigation in many different fields. The business services provided by the company include investigation of business credit, investigate of enterprise credit, the prospects analysis of market investment, the control and management of enterprise crisis, investigation and agency of intellectual property rights, marketing products and services of database, market investigation and investigation and take evidence and so on. The organizational structure of the company includes business departments including the different kinds of business departments and logistics departments of financial department, human resource management and computer and data centre.

This company is one of SMEs in China and has experienced rapid growth in the past ten years. After experiencing the earlier rapid development, Ken Bang is facing many problems of human resource management for the further development in the future. During the period of internship, I worked in the human resource management department of this company, and I investigated and knew some issues related to human resource management of SMEs in China through the channel of Ken Bang. The topic of my project is determined based on my experiences of internship in China. My experiences of internship in Ken Bang can help me better do my project and Ken Bang can be investigated as a case study in my project.

1.3 Research Aims and Objectives

Small and medium-sized enterprises (SMEs) play an increasingly important role in economic development of modern society, and much research has been done to focus on issues relating to SMEs. In China, SMEs has become an important part in national economy of China. In the past, China’s SMEs generally pay attention to business development and marketing, and neglect the importance of other aspects such as management. In recent years, China’s SMEs begin to realize the importance of management issues such as Human resource management (HRM) in the long-term development of the enterprise. So it is meaningful to investigate the practices of human resource management in SMEs of China.#p#分頁標題#e#

The aim of the project is to investigate Human Resource Management Practices of Small and Medium-Sized Enterprises (SMEs) in China. Based on this research aim, there are four main research objectives in this research. 

1) Review the relevant literature about human resource management practices in SMEs;

2) Investigate the status quo of human resource management in China’s SMEs;

3) Find out problems involved with the implementation and development of human resource management in China’s SMEs;

4) Present suggestions that can be recommended for China’s SMEs to solve these problems relating to their HRM practices.

1.4 Methodological Approach and Tools

In this study, the research philosophy of interpretivist is adopted because the study carries out a case study to investigate the current HRM practices of SMEs in China and it is concerned with understanding behaviour from the participants’ own subjective ideas and opinions. According to Collis and Hussey (2003), interpretivist is based on the perspective that human behaviour is not as easily measured as phenomena in the natural sciences, while positivist is founded on a belief that the study of human behaviour should be conducted in the same way s studies conducted in the natural sciences.

The inductive approach is adopted in the research, because the research will be done through investigating some key people in Intern Company and other companies to ask for their ideas and opinions. Although the inductive approach ca ne very time-consuming, it can help the research to arrive at a new way of looking at the subject (Sekeran, 2002). According to Sekeran (2002), research approach can be deductive and inductive that the deductive approach tests the definition of the subject under a clear theoretical position before collection of data while the inductive approach starts by talking to a range of people asking for their ideas and definitions of “professional”.

As to research strategy, the method of case study will be used in this research because this method offers an opportunity to study a particular subject, e.g. one organization or industry in depth. So it is helpful to analyze the HRM practices of SMEs in China and the case study results will help to analyze the key issues involved with the HRM practices such as problems and solutions of SMEs in China.

Moreover, as to tools for collecting data, data collection technique of interviews will be adopted to collect the primary data from participants in the research, because this technique is effective in collecting in-depth data according to the detailed research purposes. And on the other hand, the secondary information and data collected from public sources through the method of documentation review are also used in this research.

1.5 Structure of the Project

Besides the first chapter of introduction, other parts of the dissertation are divided into five main chapters.

The second chapter of literature review presents a critical discussion of the work of established authors who have produced major theories, concepts, ideas and framework which are linked to my research topic.The third chapter of research methodology introduces research methodologies used in the dissertation including research philosophy, research approach, research strategy, research techniques and tools, methods of data analysis, research ethics and research limitations.

The fourth chapter of results and analysis presents the findings generated from the data collected in the research, and analyzes and discusses the results of research relating to the findings of the past literature and helps to achieve research objectives of the study.

The last chapter of conclusions and recommendations reviews what the author has done in the research and summarizes the findings of the research. On the other hand, according to research limitations, this chapter also presents suggestions for further research relating to this research area.

References

Blyton, P, Lucio, M.M, McGurk, J. and Turnbull, P. (2001), Globalization and Trade Union Strategy: Industrial Restructuring and Human Resource Management in the International Civil Aviation Industry, The International Journal of Human Resource Management, 12 (3), 445-463

Collis, J. and Hussey, R. (2003), Business Research: A Practical Guide for Undergraduate and Postgraduate Students, Hampshire: Palgrave Macmillan

Fernandez, Z and Nieto, M 2005, ‘Internationalization Strategy of Small and Medium-Sized Family Businesses: Some Influential Factors’, Family Business Review, Vol. 18, No. 1, pp. 77-89

Helmreich, R.L, Merritt, A.C. and Wilhelm, J.A. (1999), The Evolution of Crew Resource Management Training in Commercial Aviation, International Journal of Aviation Psychology, 9 (1), 19-32

Laforet, S. and Tann, J. (2006), Innovative Characteristics of Small Manufacturing Firms, Journal of Small Businesses and Enterprise Development, 13 (3), 363-380

Luczka, T. (2004), Advantages and Disadvantages for Polish Small and Medium-Sized Enterprises on the European Union, Foundations of Control and Management Sciences, 7 (4), 11-21

Mathis, R.L. and Jackson, J.H. (2006), Human Resource Management, New York: Thomson South-Western

Pieper, R. (2000), Human Resource Management: An International Comparison, Paris: Walter de Gruyter

San, B.C. and Zhu, K. (2003), The Development of SMEs and Foreign Direct Investment in China, International Economic Cooperation, 6 (3), 9-13

Schuler, R.S. and Jackson, S.E. (1999), Strategic Human Resource Management, London: Blackwell Publishing

Sekaran, U. (2002), Research Methods for Business: A Skill Building Approach, 4th edition, NJ: John Wiley & Sons

Storey, J. (2007), Human Resource Management: A Critical Text, New York: Thomson Delmar Learning

Chapter Two Literature Review

2.1 Introduction

The aim of this study is to investigate the human resource management (HRM) practices of small and medium-sized enterprises (SMEs) in China. This chapter intends to provide the reader with a theoretical basis of the study through reviewing the concepts, theories and past studies focusing on this research area. This chapter consists of four main sections. The first section is to review the definitions and concepts relating to SMEs and theories that explain SMEs. The second section is to review concepts, theories and practices about human resource management. The third section is to review the literature focusing on human resource management practices of SMEs. And the last section is to review the past studies focusing on human resource management practices of SMEs in China.#p#分頁標題#e#

2.2 Definition of the Concepts of SMEs

2.2.1 Definition of the Concepts of SMEs in General

The definition of small and medium-sized enterprises (SMEs) varies in the different countries, because there are different criteria to defined SMEs in the different countries according to the different political, economic, social, cultural and market environments in these countries.

There are special criteria to differentiate SMEs from other companies in the European Union. In the European Union, a medium sized enterprise is a company with fewer than 250 employees while a small sized enterprise is one with less than employees, and the annual turnover of the enterprises should be less than €50 million (EU Commission, 2003).

In the United States, there is no distinctive way to identify SME, and typically it depends on the industry in which it competes (Phukan and Dhillon, 2000). Relative to the enterprises that dominate the industry, other companies are generally looked as SMEs in the Untied States.As a developing country with the special political, economic and market environment, SMEs are also defined differently in China. According to the Law of Chinese Small and Medium Sized Enterprises published in 2002, the criteria of the number of employees, sales revenues and total assets are used to define SMEs based on the different industries in China. Although the criteria to define SMEs are different in the different industries, SMEs in China can be generally defined as the enterprises with less than 2000 employees, less than RMB 30 million annual sales revenues and less than RMB 150 million total assets (Law of Chinese Small and Medium Sized Enterprises, 2002 ).

2.2.2 Theories that Explain SMEs 

As a phenomenon, small and medium sized enterprises (SMEs) receive more attention with the increasingly important role of them in economic development. Generally SME refers to a business that maintains revenues or a number of employees below a certain standard (Fernandez and Nieto, 2005). The amount of revenues and the number of employees are two general criteria used to measure SMEs from large companies. According to Martin (1999), the SME sector is segmented and categorized according to measurable variables such as size and industrial classification. The variables of size and industrial classification are important because the size or scale of the enterprises is restricted to the development of the industry (Martin, 1999). According to the different industrial classification, some enterprises are SMEs in some industries but the enterprises with the same sizes may be the large enterprises in other industries.

It has been proved by many empirical studies (Laforet and Tann, 2006; Wagner and Hansen, 2005; Luczka, 2004) that most of SMEs have some disadvantages compared large companies in the same industry. These disadvantages are mainly focused on resource that on the one hand SMEs have difficulties in obtaining various kinds of resources such as funds, and on the other hand the attractiveness of SMEs to talents is weak relative to the large companies (Laforet and Tann, 2006). Moreover, it is much easier for the large companies to obtain the support from the government than SMEs based on their important roles in the industry (Wagner and Hansen, 2005).

But on the other hand, SMEs also have some advantages compared with the large companies. SMEs operate more flexibly than the large companies, which make SMEs more easily to adapt the changes of market environment and timely adjust their operation and strategic goals in terms of the changing environment (Luczka, 2004). And SMEs have a quicker response to the needs of the customers in the market, because their scale is relative small and it is more easily for them to change and improve their products according to new needs of the customers (Luczka, 2004).

In the past especially in the 1980s, the state-owned enterprises played an important role in the national economy of China. Upon the support from the government in the planned economy, these state-owned enterprises are generally large companies and have a dominate position in the industries in which they operate (Ma and Liu, 2007). At that period, the development of private enterprises was restricted by the government of China so that the development of SMEs was in the incipient stage and the general scale of SMEs was very small at that period.With the transition from the planned economy to the market economy, China’s government began to reform the state-owned enterprises to push them tothe market and encourage the development of the private enterprises (Ma and Liu, 2007). Because most of the small and medium sized enterprises in China are the private enterprises, so SMEs have been experiencing rapid growth in the past several years, and now SMEs are playing an increasingly important role in national economy of China and enhance much competition pressure on the state-owned enterprises in the different industries (Chen, 2007).

2.3 Concepts and Theories of Human Resource Management

This section lists and reviews the basic concepts and theories about the human resource management (HRM), which is the basis the further analysis of the research. And keeping pace with the development of the high-technology, the computer and IT have changed the management methods and communication models, so the E-HR  theory is prosperous. In the meantime, the 360-degree assessment provides people with a deeper understanding of the HRD . All these concepts, ideas, theories form an applicable practically framework for the investigation and analysis of human resource management practices of SMES in China.

2.3.1 The review of HRM strategy

Based on the concept of managing behavior and competencies, researcher shows an integrative aspect of the human resource system . There are six basic human resource strategies, that is, Training, Selection, and Recruitment, Compensation, Development, work Design, Performance Management, Participation, are derived by juxtaposing the three basic aspects of a system (The three aspects refers to input, process, output) with the two strategic foci of HRM (behavior s and competencies). These HR strategies are referred to as Competence Displacement, Competence Acquisition, Competence Retention, Competence Utilization, Behavior Behavior Coordination, and Control . #p#分頁標題#e#

To view the development in the long run, the topic of human resource management (HRM) has become one of the most documented in the literature about management (Boxall, 1995). Managers and policymakers  now want to know how human resources (HR) are managed in different regions all over the world and how their counterparts in different parts of the globe react to or perceive similar pressures and concepts. Furthermore, the increased level of globalization and internationalization of business, the growth of new markets (such as in India, Eastern Europe, South East Asia, China, and Latin America), growth of new international business blocs and an increased level of competition among companies at both local and foreign level has led to an increase in comparative HRM studies (Brewster, Tregaskis, Hegewsch and Mayne, 1996; Clark, Gospel and Montgomery, 1999). It is also important to have a full understanding about the main determinants of HRM policies and practices in different national and regional settings . Rondeau and Wager (2001) focused on the ability of certain 'progressive' or 'high performance' HRM practices to enhance organizational effectiveness, noting growing evidence that the impact of various HRM practices on performance is contingent on a number of contextual factors, including workplace climate.

The researchers react positively to the challenges raised by the globalization of business and investigate a number of issues and problems which is associated with international business (Hendry, 1996). They have tried to testify and examine management from a cross national view point. This comparison of HRM practices and policies at a national level helps to examine the convergence and divergence thesis. The typical questions pursued by comparative researchers are (Pieper, 1990): (1) What is the effect of national factors such as government policy, culture, and education systems? (2) What are the differences and similarities? (3) What is put into practice? (4) What strategies are discussed? (5) How is HRM structured in individual countries? Researchers have also developed and proposed different models of HRM both between and within regions (Boxall, 1995; Brewster, 1995; Guest, 1997). A lot of models of HRM have a different base. As such, from the view of globalization, principles of HRM have been developed from a restricted sample of human experience to a wild level. During the infancy stage of HRM literature, such an ethnocentric approach was unavoidable and understandable and this may be an important factor in business. However, with the growth of a ‘‘global business village,’’ companies operating in different regions need appropriate information and guidance to develop their HRM practices and policies. For further developments in the field of HRM, it is important to have a framework, which can enable us to conduct such an analysis. Some researchers have emphasized a practical ‘best practice’ framework for diagnosing HRM practices. Hiltrop (1996) shows 11 dimensions of HRM, which can be used for evaluating the effectiveness of HR practices. These dimensions can also be used to benchmark HR activities and the relative influence of the best practices on organizational outcomes.

The globalization promotes the development of the Human resource management development to some extent or at least the globalization is an important factor in HRM. With the perceived power to influence, and even override nationally specific HRM with transfer of common or best HRM practices, globalization leads to the convergence among different systems. The popular of this tendency may keep HRM more distinctive. With the developing of the economy and the gradual perfection of the institution, MNC has faced varieties of challenges .

The key issues in the process of globalization may be: what leads to the convergence; what practices are the ‘best’ for companies. Via the opening up and penetration of economies to external forces and influences, globalization has serious impacts on HRM. This comes from two aspects, with both local and foreign multinational enterprise operations and investment leading to exposure to other countries’ HRM practices, greater publicity and even direct importation. The Japan first imitating their practices in 1980s first attract the attention all over the world. (as in Ford’s ‘After Japan’ and Malaysia’s ‘Look East’ campaigns) and the so-called ‘Japanization’ of industries. Globalization’s universalizing tendencies and implications can be located within work of long antecedence (Kerr et al, 1962) and more recent exponents (Peters & Waterman, 1982; Womack et al., 1990). For management an implication is that there were ‘universal truths’, including in HRM, that could be applied everywhere . A central proposition is that because of political, technological forces, economic, social and now including globalization, there is a worldwide tendency for countries, and within them HRM, to become similar as the copying and transfer of practices, sometimes taken as ‘best practices’ and linked to, was encouraged. In short, HRM systems would converge. The convergence all over the world is in process. Other than the globalization, the reason for convergence may be the development of institutional theory. Under this background, practices are adopted not because of ‘effectiveness’, but because of three specific social forces (McKinley et al., 1995). First, ‘constraining’ forces play an important role. This shift from overlooking practice to emphasizing in social constraints subsequently encourages firms to conform to legitimate structures and management activities. Second, ‘cloning’ forces, which pressurize firms to mimic the actions of leading companies in the face of challenge and uncertainty. Third, ‘learning’ forces, which are shaped through processes in educational institutions and professional associations, also are dominant.

HRM practices and policies in a cross-national background are influenced by both national and organizational culture, institutions, and industrial sector dynamics and others factors, such as age, size, nature, and life cycle stages of organization (Hofstede, 1993; Brewster, 1995; Jackson and Schuler, 1995; Sparrow, 1995). The direction and degree of effect of these factors varies from region to region (Locke and Thelen, 1995; Jackson and Schuler, 1995). For example, the response of unions to common competitive pressures (such as the introduction of new production technologies, large scale restructuring and re-engineering of organizations, and pressure to increase work flexibility) varies across different countries. Union membership has declined in countries such as the UK, France, or the US, whereas in Australia and Germany, it has remained stable.

With the development of the globalization, there is a shift from manufacturing to services in HRM . First, the difference about manufacturing and services are presented. According to Standard Industry Classification (SIC) definitions, manufacturing establishments are engaged in the mechanical or chemical transformation of substances or materials into new products while service are engaged in providing a wide variety of services for individuals, business and government establishments, and other organizations. Perhaps most importantly, the literature has long noted important differences between manufacturing and services firms (McColgan, 1997). Service operations have unique characteristics which are rarely found in manufacturing including intangibility, inseparability of production and consumption, heterogeneity, customer participation, and labor intensity (Nie and Kellogg, 1999). The direct participation of customers in the service process adds complexity that is generally not found in manufacturing (Chase and Tansik, 1983). Moreover, direct customer participation means that service firms tend to have many more physical sites than manufacturers along with the unique challenges presented by wide geographic dispersion.Intangibility is often considered as another fundamental difference between services and goods since a service cannot be touched, seen or tasted in the same manner as a manufactured product (Fitzsimmons and Fitzisimmons, 1997). Services also tend to have higher heterogeneity and thus can be either deliberately or accidentally customized between different service providers and customers in comparison to the greater process standardization of a typical manufacturer’s production. Services are likewise more perishable than physical products given that unused capacity is lost forever. Finally, services are typically more labor intensive in comparison to manufacturing (Heskett, 1986) and hence manufacturers can often realize more productivity gains through technological innovations (Quinn and Gagon, 1986).

Services make a lot of contributions to production, mainly through their direct contribution to total output and final demand, but to some extent also through their indirect contribution through other sectors. However, services are more independent from other sectors than the manufacturing industry. Most inputs which are necessary to produce services are derived from the services sector itself. Furthermore, their role as providers of intermediate inputs to other sectors is not yet as strong as that of the manufacturing sector. Dirk Pilat (2005) shows that a growing number of workers in the manufacturing industry are engaged in services-related occupations. A broad definition of service-related workers, up to 50% of manufacturing workers are in such occupations. He, using firm-level data the paper finds that, despite evidence on a growing number of services turnover within the manufacturing sector, manufacturing enterprises in most countries are not very diversified in their constituting establishment, i.e. they do not have many establishments engaged in services production. Canada is a notable exception in this respect. In other countries, it is likely that diversification primarily occurs at the level of the enterprise group. On the other hand, data on products suggest that manufacturing firms appear to derive a growing share of turnover from services, notably in countries such as Finland and Sweden .

A prime example of this has been in the area of employee relations where ‘Human Resource Management’ has gained increasing acceptance in preference to ‘personnel management’. This change and improvement is happen under the background of the opening up and reforming in China. The market-oriented strategy is in great need of advanced management thoughts. HRM represents neither the latest management whim, nor simply the preference for a new label, but rather constitutes a key issue within contemporary work organizations. The researchers updates HRM gradually both in conceptual and empirical foundations. However, there are some different opinions. Some argue that HRM is no more than ‘good’ personnel management. Given the dearth of empirical evidence on HRM,the original book and literature provide a valuable reference for personnel and other managers interested in gaining a more comprehensive understanding of the changes in approach which are occurring in the way people at work are managed. Up to now, more literature has found a lot of evidence to support the operation of HRM and it indeed provide a lot of benefits for the firms.

2.3.2 The review about competency management and 360-degree assessment

Competency management is one of modern human resources management central ideas and the position competency assessment is one of human resources management cornerstones. Stimulating occupational expertise and employability of employees appears to be advantageous for both organizational and employee results.

The concept of employability came into use around 1955 (Versloot, Glaude). But, it is only since the 1900s that employability has been studied empirically. Many reviews have shed light on the development of its conceptualization and definitions (Thijssen and Van der Heijden, 2003). Employability is studied from different angles and distinct levels (individual, organizational, and industrial) across a wide range of academic disciplines, such as business and management studies, educational science, psychology, human resource management, human resource development, and career theory. However, few studies have tried to integrate these different perspectives (Thijssen and Van der Heijden, 2003).

Employability is believed to accommodate some or all of these parts, such as career development, learning, cognitive suitability, de-specialization flexibility, adaptation to changes and mobility, relying on the angle from which the concept is researched and, consequently, it is not a concrete construct. Fugate (2004) who recently thoroughly studied its conceptual foundation from a career angle, use the term variegated. Apart from the large variety of employability definitions, one might be able to distinguish a link between the conceptualization of employability and certain historical work and organizational developments in Western countries (Van Lammeren, 1999; Versloot et al., 1998), in relation to the transition from an industrial to a postindustrial society (Thijssen and Van der Heijden, 2003).

Employability is a symbol used to address work-related problems related to this transition. Until the 1970s, employability was about employment participation and was accompanied by the so-called flexibility of society. The government was considered the actor responsible for achieving the target of full employment and a decrease in the collective burden (Thijssen and Van der Heijden, 2003). Changes are taking place at a faster rate and in increasing numbers, undermining organizational strategy and planning, and which the organizations should be potentially able to flexibly anticipate on.

The reason for the popularity of competency programs maybe is the belief that traditional job-based management systems may impede an organization’s speed and agility in the face of today’s globalization and rate of change challenges. By contrast, a competency-based system should be organized around the capabilities and capacities needed to create customer value.

Employability is a critical requirement for enabling both sustained competitive advantage at the firm level and career success at the individual level.  Competency-based approach to employability derived from an expansion of the resource-based view of the firm is proposed. A reliable and valid instrument for measuring employability is presented (Claudia, 2006). The measurement based on five-dimensional conceptualization of employability is designed. Since the five dimensions of employability explain a significant amount of variance in both objective and subjective career success. The validity of this tool is promising. This instrument facilitates further scientific HRM study and is of practical value in light of job and career recruitment, staffing, assessments, career mobility, and development practices. Recent specification of HR competencies has the potential to influence the professional development of all HR practitioners.

Recent management research suggests that competence development of Human resource professional is linked to both individual and firm success (Becker, Huselid, and Ulrich, 2001, Ulrich and Brockbank, 2005). More broadly defined competencies for HR professionals are necessary (Mary, 2006).

There are some researches paying much attention to the competency of the workers. They want to find the basic factors in HRM about the employer. A lot of research has been got and confirm the importance of the competency of the employers. Highly employable workers (Van Dam, 2004) are very necessary for organizations in order to meet fluctuating demands for numerical and functional flexibility (Marginson, 1989). If some enterprises are lack of the employers with high quality, the development of these companies is very hard. In addition, employability enables employees to cope with fast-changing job requirements in this new era. London and Greller (1991) refer to “loosening of organizational commitment (to markets, tradition, and employees), accommodating a more volatile and competitive environment” (adapted from Baerveldt and Hobbs, 1988), and job content becoming more demanding, in terms of technical knowledge and skills. More factors have been found in the process of management.#p#分頁標題#e#

Many companies now use some form of multi-criteria or 360-degree assessment process to measure managerial competencies specifically suggested that within competency programs, supervisory judgments about individual capabilities may not be as accurate as those of other, perhaps more qualified observers, especially “peers and technical experts”. Traditional top-down assessment (TDA) systems consist of one person, the direct supervisor, conducting a periodic evaluation of the employee’s competence or performance over a specified time period. Traditionally, TDA has been the most widely used approach to performance assessment in organizations (Mount and Goff, 2000) and in decision-making processes concerning who will be promoted (Powell and Butterfield, 1997). While 360-degree systems were originally used for developmental purposes, they are increasingly being used for administrative decision making (Greguras, Robie, Schleicher and Goff, 2003). Lucia and Lepsinger (1999) are among the many consultants recommending a 360-degree assessment approach to the measurement of competencies. Three-hundred-sixty-degree assessment programs gather performance information from subordinates, peers, supervisors, and (occasionally) customers. Borman (1997) asserts that two assumptions underlie these programs: (1) each source of rating offers at least somewhat unique information concerning the performance and (2) evaluations from different sources exhibit incremental validity beyond that of any single source. Others suggest that 360-degree assessment is less likely to be susceptible to rater bias than single-rater systems (Bernardin and Tyler, 2001), that receiving assessment from people with different relational perspectives provides a more comprehensive perspective (Yammarino and Atwater,1993), that assessment is less likely to be ignored if subordinates and peers are included (London and Smither, 1995), and that 360-degree assessment fits better than traditional TDA given today’s downsized, more horizontal, team-based organizations (Murphy and Cleveland, 1995). However, the incremental validity evidence discussed earlier makes a compelling case for the use of 360-degree assessments for decision making. Individuals in organizations that use 360-degree assessment for administrative (rather than just developmental) purposes can use these findings to help persuade other employees and managers of the importance, relevance, and validity of conducting 360-degree (as opposed to just top-down) assessments. Individuals can emphasize that although the 360-degree assessment requires more time and energy on the part of managers, employees, and human resource professionals, such assessments provide incremental validity beyond that of TDA. This message can be communicated at several points during the 360-degree assessment process (Christine, 2006).

2.3.3 The review about IHRM, flexible firm and E-HR 

In Maddy Janssens (2003) article, he illustrated the IHRM from a wild perspective. An exportive, integrative or adaptive approach represents three basic aspects for IHR managers, reflecting a comprehensive method to IHRM. However, in practice, IHR managers may have the option to select for a mix of the three ways. For the IHR function contains a few of tasks and is oriented towards different employees, choices differ for the different tasks or employee groups. For instance, Luthans and colleagues (Luthan et al., 2001) advised IHR managers to set up a contingency matrix for IHRM. The horizontal row of the matrix represents the different sample of HR tasks such as recruitment and selection, training, compensation, labor relations, and job design. Different countries of the MNC are being placed. The pragmatic value of such a matrix is that it can be used to organize the existing entity of knowledge and experience and to constantly remind IHR professionals that different HR tasks may require different choices for different countries.

Many companies emphasize that their senior managers must not only possess technical skills but also need to have a broad understanding of history, culture, sociology, and human relations. Consequently, the selection criterion often set for this employee group is global awareness or global mindset, referring to openness to other cultures, multiple language skills, tolerance and flexibility (Harris and Morran, 2001). Another example refers to training & development, which may differ for higher and lower level managers. UCB, a Belgian company in the film, chemical and pharmaceutical industry, developed its own ‘global leadership program’ for its higher level managers. Its purpose is to broadly develop these managers by offering expertise in different functional areas as well as intercultural communication and negotiation skills. Corporate HR further decided that the 3-week program takes place in Asia, North America and Europe, the three regions in which the company is active. Moreover, they selected trainers coming from these different areas as well as local experts from each region to discuss its cultural, political and socioeconomic context. While this program for higher level managers reflects an integrative approach, training, and development for lower level managers reflects an adaptive approach with local HR managers being responsible for this HR task. In the 1980s, a good deal of attention was paid to the issue of labor use strategies. Much of the discussion focused on the Institute of Manpower Studies (IMS) core-periphery model depicting the so-called flexible firm, adopting financial, functional and numerical forms of flexibility (Atkinson, 1985).

Suffice it to say that in the context of the early 1980s it was increasingly asserted that organizations were adopting a labor management stance which put more emphasis on the use of 'flexible' or nonstandard forms of labor contract (such as part-time, temporary contract, agency labor and self-employed subcontractors of services) as compared with the traditional full-time employment contract with no specified time duration. 

In the flexible-firm model the lines of segmentation are horizontal within the organization and that the divisions between the core and the periphery may become deeper, with implications for labor market structure and for industrial relations processes. The model needs to be understood at a political level, as part of a wider `post-industrial' vision; and that the observed increase in flexibility offers the model no support because of its `non-strategic' nature. `Flexibilization' of management and company organization in order to increase entrepreneurial behavior is a vital and hitherto neglected component of economic restructuring. It is argued that flexibility operates on a different level from flexible specialization and other varieties of `post-industrialism' and that to consider them together confuses rather than illuminates the debate. On the second, it is argued that the criticism relies on an unnecessarily restrictive view of strategy. Rather than being regarded as `plans', strategies should be regarded as `patterns' in decision-making. On the basis of this alternative conception the paper suggests ways in which the flexible firm model might be recast.#p#分頁標題#e#

With the innovation of the latest advanced technologies which offer the potential to streamline many HR functions, businesses are making use of the information technology to design and deliver their HR practices. This trend is not surprising given the substantial benefits which can emerge from integrating information technology into HR function. The resent survey predicts that making use of the new technologies can reduce the HR transaction cost by 75% (Cedar, 2001).

There is no doubt that information changes our lifestyle to a large extent. On the other hand, Information technology has been cited as a critical driver of HR’s transition from a focus on administrative tasks to a focus on serving as a strategic business partner. This strategic role not only accumulates a valuable dimension to the HR function, but also changes the competencies that define the success of HR professionals. Through making an interview with 19 firms, the implication for the development of HR competencies and identify learning strategies that HR professionals can utilize to fulfill their changing roles and responsibilities is got (Bradford, 2006). Furthermore, The institution of Management and Administration (IOMA) found that 70% of companies claimed that technology improve the quality of HR service and 67% reported that E-HR has led to improvements in organizational efficiency (IOMA, 2002).

As the growth of information technology, most of the administrative function can be finished through advanced technology hosted by the enterprise and the other institute (Lawler and Mohrman, 2003). Up to now, most technology substitute the routine boring tasks, there is a chance for HR professionals to be a strategic partner (Brockbank, 1999; Ulrich, 1997). A lot of new expert in areas such as change management, strategic business partnership and employee advocacy is appearing (Ulrich, 1997).

Recently, some researcher use data collected through making a interviews with senior HR professionals from 19 Fortune 500 companies to testify the relationship between E-HR and the reshaping of the professional competence in HRM. The result shows that information has been identified as an impetus of HR’s transition to becoming a strategic business partner (Lawler and Mohrman, 2003). The research on E-HR has proved the function of E-HR from the perspective of the theoretic and in practice. More and more enterprises are inclined to adopt this new method to resolve and improving the management of enterprise. A practical implication can be draw from the analysis above. That is, an important implication of this competency shift is that as companies implement E-HR initiatives, they also will need to pay attention to how best to prepare HR staff for their new roles and responsibilities. The shift predicts utilizing development activities that provide HR professional with the competencies necessary to be successful in an E-HR environment. The key to creating the capacity for strategic application of the expertise is integrating two competency domains.

2.4 Review Literature on HRM Practices of SMEs

Human resource management practices have attracted much attention from many researchers and much past research has been done to investigate the topics relating to this research area. Especially with the growing importance of small and medium-sized enterprises (SMEs) in the economy, many issues about SMEs such as strategic management and human resource management have become increasingly important in the research. More and more researchers begin to not only pay attention to human resource management practices of large enterprises, but also attach enough importance to HRM practices of SMEs.

Brand and Bax (2002) did a research focusing on the growing importance of strategic human resource management (SHRM) for small and medium-sized enterprises (SMEs). They did this research upon the background that many small encounter serious human resource problems, while at the same time these human resource play a vital role in developing and sustaining their competitive advantages. In this research, the authors explored specific issues concerning small firms in HRM literature, and concluded that the available knowledge on human resource management in small firms is highly descriptive and fragmented. The findings of the research suggested that the strategic labour allocation process model (SLAP) should be applied as a tool to analyze human resource problems in SMEs, because this model focuses on the balance between the supply of and the demand for labour on a firm level. In the research, it was proved through the application of the SLAP model to produce two strategic scenarios for Dutch SMEs presently confronted with a tight labour market. 

Kasturi et al (2006) did a research to investigate the relationship between HRM systems architecture and firm performance based on the evidence from SMEs in a developing country, because the authors believed that the effects of human resource management (HRM) on firm performance can be examined at the systems architecture (i.e. guiding principles or philosophy), the policy, or practices levels. In this research, the authors used a unique dataset of 44 small and medium-sized enterprises in Tamil Nadu city of India and them presented a regression analysis of the relationship between human resource management philosophies and measures of firm performance. It was found in the research that the attitude of the firm’s owner(s) towards its employees is a major determinant of the firm’s profitability, and on the other hand, the effect of human resource management philosophy on productivity is smaller, albeit still highly significant. Moreover, the findings of the research also suggested that at least for small and medium-sized enterprises (SMEs) in the developing countries, HRM systems architecture is the guiding principle that affects a firm’s performance.

Cassell et al (2002) reported on empirical work recently conducted about the use and effectiveness of human resource management practices in small and medium sized enterprises (SMEs). The authors did this research through a telephone survey conducted with 100 senior managers of SMEs to ascertain their use of a range of human resource practices and the extent to which they had found those practices successful or failed in aiding the achievement of their companies’ objectives. Besides this telephone survey, an additional in-depth interviews were also conducted by the authors with the senior managers from a further 22 SMEs. Moreover, a model is provided that identifies the key criteria that underlie the adoption of human resource management practices, and the implications of the model are discussed. The findings of the research indicated that there is considerable diversity amongst SMEs in relation to their use of human resource practice.

Wilkinson (1999) did a research to investigate human resource management practices of SMEs focusing on employment relations in SMEs. Although most of the HRM literature is based on large firms despite the growing significance now accorded to smaller firms, in this research the author explored employment relations in SMEs and argued that the existing literature tends to polarize into a “small is beautiful” or “bleak house” perspective. So this research examined some of the key issues in relation to employment relations in SMEs. The findings of the research showed that compared with the large enterprises, SMEs also have to face many problems involved with their employment relations, though the size of their enterprises and the scale of employees is relatively smaller.

Reid and Adams (2001) did a survey of practices within family and non-family firms, because small firms were generally neglected by the studies. Much of the literature relating to human resource management (HRM) has attempted to demonstrate that the “human resource” is the most valued asset in a company. Large companies have revolutionized their approach to the training and development of their personnel in order to maximize their “competitive edge”. Hotly debated is whether investment in good HRM is lined to commercial business. However, very little is known about HRM practices within a family business. This research describes the HRM practices of SMEs (both family and non-family businesses) in Northern Ireland. In this research, comparisons between the groups are made by authors and the findings of the research indicated that family businesses practices of human resource management are very different from their non-family counterparts. Implications forthe tra ning and development of these two groups question whether family businesses need to be treated as a “special case”.

Szamosi et al (2004) did a research to focus on developing an understanding and benchmarking, human resource management (HRM) issues in small and medium sized enterprises (SMEs) in South-Eastern Europe. The importance of SME’s in helping transition based economies develop is critical, but ar the same time the research indicates that the movement toward westernized business systems has a dramatic impact on the human resources within such businesses. Toward addressing this linkage, critical HRM issues related to work outcomes, measures of satisfaction, and managerial support were studies with a sample of nearly 300 employees from 21 SMEs in a country in South Eastern Europe (the Former Yugoslav Republic of Macedonia). The data suggested that SMEs are not currently giving their employees what they want from their job (e.g. career development, participation in decision making) and that women are treated differently than men creating an imbalance within the workforce. These findings of the research drawn from the data are very useful to recommend for SMEs on how to move forward as transition unfolds.

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Hill et al (2000) conducted a research to draw on case study research into human resource development (HRD) within three small organizations in the north-west of England. The research positions the investigations within an overall framework of doctoral research, defines how the term small to medium-sized enterprise (SME) has been used, and summarizes the research design. The main content of the paper discusses the characteristics and values of SMEs in general and explores how these might influence the HRD policies and practices developed by them. A comparison of an HRD model typically found in small organizations with one typically engendered through the adoption of the Investors in People standard is presented. Findings and conclusions about HRD in the three case-study organizations are reported to include a description and comparison of the three cases’ own HRD models. The paper concludes with some suggestions for further research.

Saru (2007) did a research to study human resource development (HRD) and organizational learning issues in a small expert organization through a qualitative single case study conducted in one Finnish SME. The research is descriptive in nature and the aim is to find out whether the existing HRD and OL practices are relevant and appropriate in the small context. The findings of the research revealed that small organizations do consider HRD to be an issue, even though it may not be as visible or official as in larger companies, and the HRD, OL or strategy issues merge into the territory of just one man. Current literature has established that the models designed for larger organizations are not directly applicable to the small context. From the SME perspective, the research suggested that there is a lot a small organization can do in terms of human resource practices, even without vast resources. And the research also suggested that further research should concentrate on findings out what model SMEs use for the development of human resources.

As the volume and complexity of employment legislation increases, small and medium-sized enterprises (SMEs) without access to internal human resource expertise are increasingly vulnerable to litigation and its associated costs. The disproportionate impact of employment regulation on the small firm has long been a concern of SME owner-managers and is expected to increase as a result of the recent rapid expansion of labour law in the UK. Harris (2000) considered evidence from a recent survey of small businesses, which examined their main employment concerns and the sources of advice they use on employment relations matters. The survey’s findings illustrate the particular challenge increased employment rights presents to the smaller organisation. It identifies a need for more intensive support tailored to the specific circumstances of individual firms in developing proactive approaches to human resourcing which not only comply with but also reflect the spirit of the legislation. 

Karami et al (2008) did a study to examine the nature and impact of human resource capabilities and involvement on the firm’s performance in the SME sector, based on an empirical survey of Chief Executive Officers (CEOs) and their perception of the HR involvement in strategy development in high tech SMEs operating in the electronics industry in the UK. Postal questionnaire is the main data collection instrument for this research, and a combination of qualitative and quantitative approaches has been employed for data analysis. The findings of the research showed that increasing the core competencies of the firm, in particular in HR, is the key element to the success of the firm. Moreover, it was posed that the growing involvement of the HR in the development and implementation of business strategy will lead to the increased effectiveness of the organization and the industry as a whole. Lastly, in order to increase firm performance and to benefit from HR capabilities, it was recommended that practitioners and SME CEOs should increase the involvement of their HR specialists in the processes of strategic management in their firms.

2.5 Review Literature on HRM Practices of SMEs in China

In the past, much research relating to human resource management was focused on practices in the western developed countries, because enterprises paid enough attention to HRM practices in these countries. But with the rapid development of the economy and the increasingly important role of human resource management in the developing countries such as China, many enterprises in the developing countries have attached importance to their practices of human resource management and much and much research has been done to focus on HRM practices in the developing countries.

Cunningham and Rowley (2007) did a research to emphasise the development, importance and pressure on the under researched area of Chinese small and medium sized enterprises (SMEs) and human resource management (HRM) and provide a review and research agenda especially relating to the debate on convergence vis-a-vis divergence. This research examined recent research papers that are discussed and possible convergence and the pressures on HRM and its practice in Chinese SMEs. In this research, key elements in Chinese HRM are highlighted and four main dimensions of HRM are compared in terms of western and Chinese characteristics and their cultural impacts and problems based on a conceptual framework to locate influences on Chinese HRM. The findings of the research indicated that the continuing influences on HRM suggest that a distinctly Chinese HRM approach combining western practice with Chinese characteristics may be one way for SMEs in China to develop, and it is central to a better understanding of Chinese SMEs and helps fill some of the gap in the analysis of HRM in Chinese SMEs.

Zhao (2008) conducted a research to investigate the status quo of human resource management of SMEs in China and try to find out suggestions for Chinese SMEs in improving their human resource management. With the development of the society, modern management has entered a new era on the basis of human management and management science has developed toward the aspect of management art. In the new century, the competition between enterprises has been more and more intense and the core of the competition is focused on the competition of human resources. It is more and more important for enterprises to have a good human resource management in order to succeed in the market. It was found that most of enterprises especially SMEs in China have not realized the important role of human resources in the development of their enterprises and the importance of managing human resources to the competition of enterprises in the market. The research suggested that upon the background of network, verbalization, diversification and globalization, small and medium sized enterprises in China should make necessary changes in many aspects such as goals, ideas and ways of human resource management in the future in order to survive in the intense competition. 

Based on the past research on human resource management of SMEs, Jin (2008) did a research to investigate human resource management of Chinese SMEs on a new vision of globalization. China is gradually involving in world economic system upon the background of economic globalization, and globalization has brought many impacts on many SMEs in China. Human resource management is particularly important to SMEs compared with the large enterprises, but it was found in the research that Chinese SMEs have shortages in many aspects of human resource management such as bias ideas of HRM, inefficient development of human resource and lack of scientific system of human resource management. In order to face the challenges of globalization, the findings of the research indicated that Chinese SMEs must gradually perfect their human resource management. It was suggested that Chinese SMEs should change their ideas about human resource managemet, pay attention to the training of employees, establish the effective system of motivation, and foster the good culture of the enterprise.

Many SMEs in China face various kinds of problems involved with their human resource management. Some SMEs in China have gradually realized the importance of human resource management and tried to perfect their management of human resource, but most of these enterprises failed to have achieve a good effect on their human resource management. Liu (2008) did a research to focus on the dilemma of SMEs in China on the aspect of human resource management and present recommendations for Chinese SMEs to solve their dilemma. It was found in the research that SMEs have become the important forces to drive the development of China’s national economy and society, but the development of SMEs is not stable. The shortage in human resource management has become the important factor to restrict the development of SMEs, especially in the period of quick expansion for the enterprise. Facing the current dilemma of Chinese SMEs, the author presented some recommendations. Firstly, Chinese SMEs should pay more attention to their human resource management. Secondly, SMEs should perfect their system of performance appraisal and perfect their system of motivation. Thirdly, Chinese SMEs should try to constitute the scientific plan of training and construct good organizational atmosphere. These recommendations are useful for Chinese enterprises to realize value added of human capital and maintain the sustainable development of the enterprises.

Zhang and Zhang (2008) also did a study to investigate the current practices of human resource managements of Chinese SMEs. The authors thought that human resource management plays a core position in modern enterprise management. But due to the speciality of growth and development, SMEs generally have many problems in the aspect of human resource management, and this to a large extent has become one of the important factors to negatively affect the development of SMEs, especially in the developing countries such as China. The research found out three main problems involved with the current human resource management of Chinese SMEs. These problems include lack of enough importance toward human resource management, lack of relevant talents in human resource management and lack of enough atmosphere in the interior of the enterprise. Three recommendations were also presented in this research by the authors for Chinese SMEs to better manage their human resources. The first is to enhance the importance of both the enterprise and the employee to human   resource management. The second is to foster more professional talents in human resource management through training. The third is to establish a good organizational culture in the interior of the enterprise.

The research Peng (2007) directed focused on the bottleneck problem of human resource management of Chinese SMEs. Similar to the finding of some past studies, the author also thought that as one of the important forces in national economy of China, the existence and development of SMEs in China has be negatively affected by some problems in their human resource management. But different from the findings of some past studies, the author found that the basic factor leading to the bottleneck problem of human resource management for SMEs is their organizational structure and cultural. In most of SMEs in China, the department of human resource management does not have an important position in organizational structure. And lack of good organizational culture makes it difficult for most of SMEs to realize the importance of human capital to the development of their enterprise.#p#分頁標題#e#

2.6 Conclusion

This chapter not only reviews the concepts and theories relating to SME, human resource management (HRM), but also reviews many past studies focused on this research area to summarize findings from these past studies. The findings from the literature show that human resource management has become an increasingly important issue to influence the development of the enterprise not only in the western developed countries, but also in many developing countries like China. SMEs are experiencing rapid development in China and playing a more and more important role in national economy and the society of China, but they have to face many problems involved with their human resource management and HRM has become one of the most important factors to restrict the development of SMEs in China. Based on these findings summarized from the literature, this research will do a further investigation to examine the human resource management practices of SMEs in China.

Here you should provide what are the most important points from this chapter to remember when reading the following chapter. Do the information presented above contradict each other at some points? How can this be explained? Are there areas were information are still missing and how will you paper address one of these subjects? Which knowledge from the literature review was used in order to design and interpret the empirical study?

Chapter Three Research Methodology

3.1 Introduction 

The purpose of this chapter is to provide the reader with an understanding of the methodology and relevant research approaches adopted in our research. In this chapter, we explain the research philosophy, approaches and strategies, and why the methodology has been adopted, at the same time, the constraints associated with data collection and the limitations to the work will also be discussed.

The research aim for this dissertation is to investigate the current human resource management practices of small and medium-sized enterprises (SMEs) in China. Obtaining effective data and information is of vital concern to build an accurate picture of the issue being studied. To a large extent, methodology determines the outcomes of any research. Therefore, it is crucial to choose appropriate research methods and conduct them effectively in order to answer the research question and meet the research objectives well.

3.2 Discussion of Methodology Theory 

3.2.1 Research Philosophy 

The first question that any researcher should raise before conducting a real research project is what research philosophy you will adopt, this is very fundamental step and generally speaking, there are three views about the research philosophy that dominate the literature: positivism, interpretivism and realism (Saunders et al., 2003).

The key idea of positivism is that the social world exists external, and its properties should be measured through objective methods, rather than being inferred subjectively through sensation, reflection or intuition (Smith et al, 1991).  If your research philosophy is positivism, you will assume the role of an objective analyst, make detached interpretations about data collected in a value-free manner and emphasize on a highly structured methodology to facilitate replication (Gill and Johnson, 1997) and quantifiable observations that lead themselves to statistical analysis. 

By contrast with positivism, interpretivism is often associated with the term social constructionism which is critical of positivism and argues that rich insights into this complex world are needed.  The role of the interpretivist is to seek to understand the subjective reality of those that they study in order to be able to make sense of and understand their motives, actions and intention (Saunders et al., 2003).  In other words, social constructionism offers that reality is subjective and it is socially constructed and given meaning by people (Seddighi, 2005).

Finally, realism recognizes the importance of understanding people’s socially constructed interpretations and meanings, or subjective reality, within the context of seeking to understand broader social forces, structures or processes that influence, and perhaps constrain, the nature of people’s views and behaviors (Saunders et al., 2003).

Based on the differences of three philosophies, this research is of an exploratory nature which is a kind of social constructionism. As Cooper and Schindler (1998, p. 131) state that, “exploratory studies tend toward loose structure with objective of discovering future research tasks”.  Besides, MacDaniel and Gates (1999, p.63) claim that “exploratory research is usually small-scale research undertaken to define the exact nature of the problem and gain a better understanding of the environment within which the problem occurred”.  All of these fit well with the objectives and other conditions of my research project. Therefore, we adopt the interpretivism philosophy of an exploratory nature in this study.

3.2.2 Research Approach 

Inductive and deductive approaches

There are two basic research approaches available when conducting business research including deductive and inductive methods (Saunders et al., 2000). Their characteristics are described in the following table:

Table 3.1 Comparison of Deductive and Inductive Research Approach

      Induction emphasizes  Deduction emphasizes  

-gaining an understanding of the meanings humans attach to events -scientific principles 

-a close understanding of the research context -moving from theory to data

-the collection of qualitative data -the need to explain causal relationships between variables 

-a more flexible structure to permit changes of research emphasis as the research progresses -the collection of quantitative data

researcher independence of what is being researched

-a realization that the researcher is part of the research process the application of controls to ensure validity of data

-less concern with the need to generalize -the operationalisation of concepts to ensure clarity of definition

-a highly structured approach 

 -the necessity to select samples of sufficient size in order to generalize conclusions

(Saunders et al., 2003)#p#分頁標題#e#

The deductive approach is usually regarded as an effective way to test theories, where people develop a theory and a hypothesis (or hypotheses) and design a research strategy to test the theory (Saunders et al., 2000). The focus is on whether or not the suggested theory fits, and is appropriate for the organization (Saunders et al., 2000; Seddighi, 2000). The deduction to research owes much to what we would think of a scientific research, in which you develop a theory and hypothesis and design a research strategy to test the hypothesis (Saunders et al., 2003).On the other hand, inductive approach is usually used to build theories, in practice, people need to collect data and develop theory as a result of data analysis. Nevertheless, the two methodologies are not mutually exclusive, in reality; they are often used jointly in business and management studies (Seddighi, 2000). However, it is important to point out that the choices of research approach should base on the research question and research objectives.

Therefore, there is no question that the inductive approach is appropriate for this particular research. I will use the inductive approach, from data to theory, by collecting the data first and then developing new hypothesis as a result of the data analysis. In reality, the research focuses on not only understanding why something happens in the business sector but also describing what happens. As the inductive approach usually only tell people why something happens rather than describe what happens (Saunder et al., 2000), it would have advantage to combine the two approaches in this particular research according to the nature and purpose of this research.

Quantitative and Qualitative Approach

There are two main types of marketing research in terms of the two, essentially different types of data that are generated by fundamentally different research approaches-quantitative and qualitative methods (Adcock et al., 1995).

Quantitative research involves the collection of information that can be expressed using a numerical measure (Brassington and Pettitt, 2003). However, it includes not only numerical data such as sales figures, market share, market size and demographic information, but also the numerical aspects of other data, often derived from primary research, such as questionnaire-based surveys and interviews (Adcoco et al., 1995). Obviously, the quantitative research usually involves large-scale surveys that enable a factual base to be formed with sufficient strength to allow statistically rigorous analysis (Brassington and Pettitt, 2003). Therefore, the success of quantitative research to a large extent depends on establishing a representative sample that is large enough to ensure that the data collected are reliable and objective. Due to time and financial constraint, obviously, it is unpractical to conduct a truly quantitative based research regarding the timetable and the requirement of the research project. That is not saying that quantitative data will not be utilized in this project. In fact, it is important to obtain the quantitative data from secondary sources in order to support the argument. #p#分頁標題#e#

Qualitative research, on the other hand, usually involves the collection of non-numerical data that is open to interpretation, such as customer’s opinions, where there is no intention of establishing statistical validity (Brassington and Pettitt, 2003). The essence of qualitative research is that it is ‘diagnostic’; therefore, it is especially useful for investigating attitudes, motivations, beliefs and intentions. In practice, they are usually based on small-scale samples; therefore, it cannot be generalized in numerical terms (Brassington and Pettitt, 2003). Chisnall (1997) further characterized the method as impressionistic rather than conclusive, he also pointed out that the approach could provide a better understanding of certain factors that might influence buying decisions. However, it is important to point out that the results generalized from the process are often subjective. But for all its limitations, qualitative research is an effective way to reflect the complexity of the interrelationships associated with marketing activities (Chisnall, 1997).

Table 3.2 The differences between quantitative and qualitative research methods

Quantitative methods Qualitative methods

•Emphasis on testing and verification

•Focus on facts and /or reasons for social events

•Logical and critical approach

•Controlled measurement

•Objective “outsider view” distant from data

•Hypothetical-deductive; Focus on hypothesis testing

•Result oriented 

•Particularistic and analytical

•Generalization by population membership

 •Emphasis on understanding 

•Focus on understanding from respondent’s/ informant’s point of view

•Interpretation and rational approach

•Observations and measurements in natural settings

•Subjective “insider view” and closeness to data

•Explorative orientation

•Process oriented 

•Holistic perspective

•Generalization by comparison of properties and contexts of individual organization

Source: Based on Reichardt and Cook (1979)

According to the objectives of my research, qualitative methods will be the main research method to provide intricate details and understanding in my project, because qualitative data is associated with such concepts and is characterized by their richness and fullness based on your opportunity to explore a subject in as real a manner as is possible (Robson, 2002). However, it is important to point out that the results generated from this process could be subjective. But besides its limitations, qualitative research is an effective way to reflect the complexity of the interrelationships (Chisnall, 1997). Nevertheless I am not saying that quantitative data will not be utilized in this project. In fact,quantitative data is very important to present the facts and backgrounds of the company and the industry as a whole. Due to time and financial constraint, I will obtain the quantitative data from secondary sources in order to support the argument.#p#分頁標題#e#

3.3 Data Collection 

This section introduces the issues about data collection, which includes data source, data collection techniques, access, sample selection, and data analysis methods and so on.

3.3.1 Data Source

There are two sources of data including secondary data and primary data. Secondary data are information collected by others for purposes that can be different from ours, while primary data are original data collected by us for the research questions at hand (Ghauri and Gronhaug, 2002). In this research, data will be collected from both the secondary source and the primary source. On the one hand, the data will be collected from public sources such as books, published journal articles, reports and websites. On the other hand, the data will be also collected from the some Chinese SMEs that are selected in the sample of this research.

3.3.1.1 Secondary Data Collection

Sauders et al (2003) divide secondary data into three main subgroups: documentary data, survey-based data and those compiled from multiple sources. It has a lot of advantages in processing my research. Secondary data is the data which has been collected by someone else for a separate purpose, and is then used by other researcher. The value of secondary research is in what it can bring to the author as a basis for the work and individual contribution.

Commonly, secondary data come from printed sources (Books, Magazines, Journals, and trade Newspapers) and in electronic sources (CD-ROM encyclopaedias, Software packages, or online services, such as the Internet.) Books are general resource to provide relevant theory support for the study. Journals are a useful resource for information on a daily basis. They could provide the latest views and development in the particular area of study. The Internet is also very helpful for the data collecting, especially professional websites 

Advantages of Secondary Data Collection 

The most important factor determining me to use the secondary data is that it is easy to do and helps to save both time and money. My research dissertation has to be completed within three months, which implies constraints from the budget, time, and some other factors. Usually, it is much less expensive to use secondary data than to collect the primary data. Furthermore, the verification process is more rapid and the reliability of the information and conclusion is greatly enhanced. 

Disadvantages of Secondary Data Collection 

Although secondary data collection is very useful for us to collect the existing information, the information collected through this method may be incomplete. Using this technique requires people to be quite clear about what they are looking for and this technique is restricted to the data that already exist. It is not a flexible way to collect data. If you are not clear about what you are looking for, you may spend much time but not collect the data you need. So this method of documentation should be used base on the assumption that you have the clear objective about what kind of data you want to collect. #p#分頁標題#e#

And the data and information that you want to collect through this method must be the real and existing information available in the market. So this method just can help to collect the past and historic information and can not collect the in-depth information. The data sources of secondary data collection are from the public and existing materials and are not directly from the customers or other market sources.

3.3.1.2 Primary Data Collection

There are many data collection techniques to collect primary data from the research including interview, questionnaires, focus group and case study and so on. Primary data collection is every important for us to collect in-depth data and information, while secondary data collection only can provide us with the existing and skin-deep data and information.

Table 3.3 Advantages and Disadvantages of Primary Data

Advantages of Primary Data Disadvantages of Primary Data:

Can probe deeper answers Takes time 

Can get detailed information on what causes problems or benefits. More opportunities for bias creep in when results are "coded"

Can also elicit more honest and more sensitive information Also the ever-present problem of all self-report measures 

By using interviews, future change agents can also introduce themselves to the people in an organization, and establish both rapport and trust  Accuracy

                                                    (Saunders et al., 2003)

Due to the advantages of primary data, it is important for us to collection primary data through data collection techniques like interviews. Primary data collection can provide us with the in-depth data and information related to our research questions. Therefore, primary data collection is crucial to the success of my research despite of its main disadvantage that it could take a long time and cost much to collect the data and information.

3.3.2 Data Collection Methods

According to the different types of research, there are many different data collection techniques such as interviews, questionnaires, survey, observation, focus group, and documentation review and so on (Saunders et al, 2003). The different data collection techniques have their different advantages and disadvantages, and should be adopted according to the different research purposes. In this research, three data collection methods of documentation review, in-depth interviews and observation will be adopted.

3.3.2.1 Documentation Review

Among data collection techniques, documentation review is the method to quickly and accurately collect the existing information and historical information. This method is to collect data through reviewing the formal company documents and reports about production, sales and finance. (Saunders et al, pp. 104, 2003

Advantages and Limitations

We choose this method of documentation review, because this method is easy to do and has few limits to the market environment and we need to use this method to collect some existing and historic data and information for the research. This method of documentation review has many advantages and is generally used in the case study. The information collected through documentation review is factual information and through this method, we can get the comprehensive and historical information with few biases. So this method is very useful for us to understand the real information about the company at the beginning, because the documents about the company are all announced by the company, and are real and open to all the people concentrating on the company.

Although the research method of documentation review is very useful for us to collect the existing information, this method often takes time and the information may be incomplete. Using this technique requires people to be quite clear about what they are looking for and this technique is restricted to the data that already exist. It is not a flexible way to collect data. If you are not clear about what you are looking for, you may spend much time but not collect the data you need. So this method of documentation should be used base on the assumption that you have the clear objective about what kind of data you want to collect. And the data and information that you want to collect through this method must be the real and existing information available in the market. So this method just can help to collect the past and historic information and can not collect the in-depth information. The information sources of this method are from the public and existing materials and are not from the customers or other market sources.

3.3.2.2 In-depth Interviews

Generally, Observation, interviews and questionnaires are three main primary data collection methods (Sekaran, 2000). According to the purpose of this project and the restriction of time and geography, I will mainly focus on the method of interviews to collect qualitative data. The semi-structure interview has been used to collect data.

Interview is a good data collection technique to get the in-depth information and it is particularly useful for getting the story behind a participant’s experiences. This method is used when we want to fully understand the impressions or experiences of someone or want to learn about their answers to the questionnaires. (Creswell, pp.125, 1994) Interview is the  process of the communication between the interviewer and interviewee. The communication includes the free talking and the discussion about the assigned questions. This data collection technique provides people with a communication way to know the information they want to know from other people or know the opinions of other people on the assigned questions. This method of interview has strong pertinence to investigate the special issue and widely used in the market research to obtain the in-depth information.#p#分頁標題#e#

Advantages and Limitations

This data collection technique of interviews has many advantages. It is the most direct way for market researchers to communicate with the interviewees. Through this face-to-face way, the method of interviews can collect the full range and depth of information from the interviewees. This kind of information is very useful and may not be collected through other ways. And this method can be flexible with the different interviewees and the interviewers can determine and choose the questions based on their thoughts and objectives to discuss with the interviewees and obtain the data and information they need. Besides, it is also a good way to develop the relationship with the clients. (Creswell, pp.136, 1994)

And data collection technique also has many disadvantages and may lead to the biases of the collected information, because the use of this method may take much time, may be hard for people to analyze and compare, may be costly and the interviewer may bias the responses and opinions of the interviewees. On the one hand, the interviewees may not tell the full information they know or may tell the wrong information to the interviewers. And on the other hand, the interviewers may misunderstand the information from the interviewees and causes the bias during the process of data collection. 

3.3.2.2 Participant Observation

According to Collis and Hussey (2003), the method of participant observation is where the researcher becomes a working member of the group or situation to be observed. The aim of this method is to understand the situation from the inside: from the viewpoints of the people in the situation, and the researcher shares the same experiences as the subjects and this form of research can be particularly effective in the study of small groups/small firms. Participant observation can be overt (everyone knows it is happening) or covert when the subjects being observed fro research purposes are unaware it is happening (Collis and Hussey, 2003).

In this research, the author works as an internship work in Ken Bang Business Investigation Company, and this company is one of SMEs in China. This company is a good case for the author to study the research question about the current human resource management practices of SMEs in China, and this is the reason for the author to choose this company for internship. During the period of internship, the author also studies the research questions through observation in daily work of the company.

3.3.3 Sample Selection

Besides the company in which the author worked during the period of internship, the author also chose other ten small and medium sized enterprises in the sample for research. There are many SMEs in the whole China, so it is impossible for the research to include all SMEs in the sample. Because the author was working in Beijing during the period of internship, so ten SMEs in Beijing were randomly selected in the sample.

3.3.4 Access

I contact with these SMEs in the sample to make an appointment with their directors and managers for interviews. The interviews will be conducted in these companies.

Based on the method of interview to collect primary data from the directors or managers of these selected SMEs, I just simply make the sources anonymous and the information about the interviewees such as the name and position will be kept in confidentiality. This technique will not affect the data collection and the research. The true and effective data and information collected from these anonymous sources will be used to analyze the research questions.

3.4 In-depth Interview Design 

It is true that the quality of the data to a large extent depends upon the structure of the interview as well as the design of each individual question (Saunders et al., 2003). Interview is the method that may take much time and lead to the bias. So we must design the appropriate questions and design the process of the interview. In order to collect the data and information we need for the analysis, I design the questions according to our research aims and objectives.

The research aim of our paper is to investigate the current human resource management practices of Chinese SMEs. Based on this main research aim and other research objectives that have been decided before the research, the research should focus on the current practices of human resource management in Chinese SMEs including the status quo of the current human resource management for Chinese SMEs, the main problems involved with Chinese SMEs in human resource management. So the questions designed for the interview must help collect the data and information focusing on these aspects relating to research aim and objectives. The collected data must help the study to realize the research objectives.

Besides the contents of the questions, the process of interview is also very important. I plan to start with some simple closed format questions focusing on some general information about human resource management of Chinese SMEs and then majority of questions with open format are created during the interview for the interviewees to express their opinions freely. This way that asking the general questions first and then discussing the in-depth questions gives both the interviewer and the interviewee more flexibility to communicate and discuss the issues. One important point for us to attention is that we should ask the questions in a clear, easy and simple way for the interviewees to understand and discuss.

The designed questions for the interview are summarized as follows:

1） Do you think human resource management is important to the development of the enterprise?

2） What do you think of the current human resource management in your enterprise?

3） What are the differences between practices of human resource management in China and those in the western developed countries?

4） What do you think of the role of human resource management to SMEs in China?

5） Do you think the current human resource management in your enterprise is effective or not?

6） What are the main problems involved with the human resource management in your company?#p#分頁標題#e#

7） As a SME in China, do you think your enterprise have to face more problems in human resource management compared with the large enterprises in China?

8） What are your suggestions for Chinese SMEs to improve their human resource management?

3.5 Data Analysis

The data collected in this research include both the quantitative data and the qualitative data, so the different methods of data analysis have to be adopted to analyze the different types of data.

3.5.1 Analysis of Quantitative Data

Quantitative data refers to numerical and standardized data, which usually can be analyzed through using of diagrams and statistics (Saunders et al., 2000). Basically, data can be divided into categorical and quantifiable data, it is important to edit and code data before start analysis (Saunders et al., 2000). In practice, it is useful to conduct exploratory data analysis in the initial stages of data analysis, this approach highlights the importance of using diagrams to explore and understand data (Saunders et al., 2000). For instance, pie charts and percentage component bar charts can be used to explain the proportions of customers agreeing or disagreeing with the statements which are presented in the questionnaire. “Subsequent analysis will involve describing your data and exploring relationships using statistics” (Saunders et al., 2000). Finally, it is essential to re-emphasis the importance of using PC software programmes during the process of data analysis, such as SAS, APAK EXCEL etc (Greenfield 2002).

3.5.2 Analysis of Qualitative Data

It is obvious that qualitative data here refers to the data collected by semi-structured interviews and the possible secondary source of data. According to the nature of qualitative data, it is important to develop data categories and to classify them into appropriate categories before analysis, “otherwise the most that can result will be an impressionistic view of what it means” (Saunders et al., 2000, p381). It is also important to recognize the relationship between different categories of data, as well as to develop and test hypotheses with regard to the research question and objectives (Saunders et al., 2000). In reality, it is necessary to develop a provisional set of categories from the research question, research themes and initial propositions, the categories should be closely related to the research question. In short, it is critical to conduct data analysis effectively in order to answer the research question and achieve research objectives.

3.6 Ethical Issues

“Research ethics refer to the appropriateness of researchers’ behavior in relation to the rights of those who become the subject of your work and are affected by the work” (Saunders et al., 2000, p142). They are likely to occur during the whole process of the research: seeking access, data collection, and data analysis and reporting (Skearan, 2000).  There are some ethical issues to be considered in my research. First is privacy, which may be seen as the cornerstone of the ethical issues that confront those who undertake research.  In my interviews, I will not ask the participants to fill their name and I will keep all the information I have got from the interviews as confidentiality. No matter during the design and initial access stage, the data collection stage or the analysis and reporting stage, the confidentiality and anonymity are always  important. I will not attempt to apply any pressure on intended participants to grant access. Once access has been granted, I will remain within the aims of my research project that I shared and agreed with my intended participants. Sometimes, the findings may be used to make a decision that could adversely affect the collective interest of those who will be my participants, it is ethical for me to refer to this possibility even though it may reduces the level of access that I will achieve. The last problem is netiquette, which has been developed to provide a heading for a number of “rules” or guidelines about how to act ethically when using Internet. Thus, I will pay much attention to the netiquette when I distribute my on-line questionnaire via email.#p#分頁標題#e#

Moreover, the research does not harm the safe or health of the participants in the research. Thirdly, I will keep the confidentiality of the private information about all participants in the research and also keep the confidentiality of the data collected in the research, and only use the collected data and information for the purpose of research. 

3.7 Research limitations

Several limitations were encountered during the research. Firstly, the topic of this dissertation should be quite big, and we have the every reason to believe that any each section of this work should be discussed in a great length of article. From this point of view, the discussion of each section could be relative shallow. The second limitation was “time”. Due to the time constraints of the assignment, the study could not be as in-depth as desired. The third limitation was about the data collection in the research. Although we used the data collection techniques to collect primary data and secondary data from the extensive sources, there are some limitations. On the one hand, the secondary data may not perfectly suit the purpose of current research since data was collected for other purposes. Like Zikmund (1997) said “An inherent disadvantage of secondary data is that they were not designed specifically to meet the researcher’s needs” Also, secondary data may not be complete enough. On the other hand, the bias may exist in the primary data because the interviewer may misunderstand the answers from the interviewees and the interviewees may not express their real opinions and thoughts on the questions.

3.8 Conclusion 

Research methods are quite crucial to any business research. Choosing an appropriate method to a large extent determines the success of the research. Both inductive and deductive approaches are used in this particular project. Both quantitative and qualitative data will be collected. The qualitative data is mainly from primary sources based on the in-depth interviews that have been conducted with the directors of the chosen SMEs in the sample and the observation of the author during the period of internship in the case company, while the quantitative data is mainly obtained from secondary resources such as some existing and historic information. In short, the methodology used in this research is considerably appropriate and effective in order to analyze the research questions and meet the research objectives.  

Chapter Four Results and Analysis

4.1 Introduction

The aim of this project is to investigate the human resource management practices of small and medium sized enterprises (SMEs) in China. The research is mainly based on the primary research including interviews conducted with some SMEs in China and the direct observations of the researcher through the internship in a SME in Shanghai of China. This chapter is divided into two main sections. The first section is to present the results of research that includes two aspects. One is the interviews with directors or managers of ten SMEs in China. The results are summarized based on the questions designed in the last chapter during the process of interviews. The other is the observation of the researcher in one SME in China during the process of the internship. The second section is to analyze and discuss the findings of the research based on the research objectives that have been set up before the research. And the analysis of research findings is also related to the findings of the past studies that have been summarized in the chapter of literature review.#p#分頁標題#e#

4.2 Presentation of Results

Two parts of research results are included this section. One is the results obtained from the interviews that have been done in ten SMEs of China. The other is research results of observation of the researcher in one SME of China.

4.2.1 Results of Interviews

Due to the restraints of time and costs, ten small and medium seized enterprises are randomly chosen and included in the sample of the research in this study. The researcher conducted interviews directly with the directors of these ten small and medium sized enterprises in the sample. They take responsibility of the management and operation of the enterprise and are very familiar with the various aspects of the management of the enterprise. Based on the notes that I take during the process of the interviews, the answers of these interviews toward interview questions are summarized in the following parts of this section.

Table 4.1 Summary of Answers of Questions 1-3　

1） Do you think human resource management is important to the development of the enterprise?

Yes No No idea

3 (30%) 5 (50%) 2 (20%)

2） Does your company have set up the independent department of human resource management?

Yes No

4 (40%) 6 (60%)

3） What do you think of the current human resource management in China?

Very Effective Effective Not effective Poor

0 (0%) 1 (10%) 5 (50%) 4 (30%)

Answers of interview questions 1 to 3 are simply summarized in the table 4.1 above. As to the importance of human resource management to the development of the enterprise, only 3 of these ten interviewees thought that the human resource management is important to the development of the enterprise, and 50% of these interviewees supported the important role of the human resource management in the development of the enterprise. On the other hand, 2 of these interviewees in the research expressed that they have no idea about the importance of the human resource management to the development of the enterprise.

As to the question that whether the enterprise has set up the independent department of human resource management to take responsibility of the relevant affairs in human resource management, only 4 of 10 enterprises expressed that their enterprises have set up the independent department of human resource management, and other 6 of these 10 enterprises expressed that they have not set up the independent department of human resource management in the interior of their enterprises. These 6 enterprises did not set up the special human resource management department and asked other departments such as finance to take responsibility for the human resource management affaires involved with their enterprises.

As to the current human resource management in China, none of these interviewees though that the current human resource management in China is very effective, and only 1 of these ten interviewees in the sample thought that the current human resource management is effective in Chinese enterprise. In fact, most of the interviewees had a negative impression on the current human resource management of Chinese enterprises. Among other nine interviewees, five of them thought that the current human resource management in China is not effective and three of them even expressed that the current human resource management in Chinese enterprises are very poor.

 

Table 4.2 Summary of Answers of Questions 4-5　

4） What are the differences between practices of human resource management in China and those in the western developed countries?

History Cultural Difference Degree of Attention Experiences

6 (60%) 8 (80%) 10 (100%) 9 (90%)

5） What do you think of the role of human resource management in SMEs of China ?

Very important Important Not Important Not obvious

1 (10%) 3 (30%) 4 (60%) 2(20%)

Table 4.2 summarizes the answers of questions 4 to 5. As to the differences between practices of human resource management in China and those in the western developed countries, the degree of attention was looked as the most important difference between Chinese enterprises and the western enterprises because all the interviewees in the sample thought that generally the western enterprises have a higher degree of attention to the human resource management than that of the enterprises in China. As to the role of human resource management in SMEs of China, only one of these interviews thought that the role of human resource management in Chinese enterprises is very important and only 3 of them though that human resource management in Chinese enterprises is important. Moreover, 4 of these interviewees supported that human resource management in Chinese enterprises is not important and 2 of them didn’t think that human resource management have an obvious role in SMEs of China.

Table 4.3 Summary of Answers of Questions 6-9　

6） Do you think the current human resource management in your enterprise is effective or not ?

Yes No

0 (0%) 10 (100%)

7） What are the main functions of human resource management in your company?

Recruitment Performance Appraisal Reward Management Training and Development

10 (100%) 3 (30%) 2 (20%) 1 (10%)

8） What are the main problems involved with the human resource management in your company?

Lack of attention Lack of culture Lack of experiences Lack of professionals

10 (100%) 9 (90%) 8 (80%) 6 (60%)

9） As a SME in China, do you think your enterprise have to face more problems in human resource management compared with the large enterprises in China?

Yes No

8 (80%) 20 (20%)

Answers of interview questions 6 to 9 are summarized in the table 4.3 above. As to the current human resource management in their enterprises, none of the interviewees thought that the current human resource management in their enterprises is effective and all of them are not satisfied with the current human resource management in their enterprises.

As to the main functions of human resource management in their enterprises, all of the interviewees expressed that the recruitment is included as an important function in the human resource management of their enterprises. 3 of these interviewees expressed that the current human resource management in their enterprises has the function of performance appraisal, 2 of them expressed that the current human resource management in their enterprises has the function of reward management and motivation, and only one of them expressed that the current human resource management in their enterprises has the function of training and development.#p#分頁標題#e#

All enterprises in the sample of our research are SMEs. As a SME in China, 80% of the interviewees in the sample supported that their enterprises have to face more problems in the field of human resource management compared with the large enterprises in China, while 20% of them thought that compared with large enterprises, their enterprises do not have to face more problems in the human resource management.

As to the main problems involved with the human resource management in their enterprises, all the interviewees supported that lack of attention is the most important problem faced by their enterprises, because human resource management is generally neglected not only by the management but also by employees. Lack of organizational culture was looked by 80% of the interviewees as the main problem involved with the human resource management in their enterprises. Besides these two main problems, lack of experiences in HRM and lack of professional employees in HRM were respectively supported by 80% and 60% of all interviewees as the important problems faced by their enterprises in the human resource management.

Table 4.4 Summary of Answers of Questions 10-12　

10） Do you think it is necessary to improve the human resource management of SMEs in China?

Yes No

10 (100%)  0 (0%)

11） In your opinion, what is the key factor in establishing an effective human resource management in the enterprise?

Degree of attention  Organizational Culture Professionals in HRM Training

9 (90%) 8 (80%) 7 (70%) 5 (50%)

12） What are your suggestions for Chinese SMEs to solve their problems of human resource management and improve their human resource management?

Improve their attention to HRM Establish a good organizational culture Learn experiences from the western enterprises Foster more professionals in HRM

10 (100%) 8 (80%) 7 (70%) 7 (70%)

Answers of interview questions 10 to 12 are summarized in the table 4.4 above. As to the necessity of improving human resource management, all the interviews in the research supported that it is necessary to improve the human resource management of SMEs in China. And they also thought that it is necessary for their enterprises to improve their practices of human resource management.

As to the key factors in establishing an effective human resource management in the enterprise, the interviews presented many different key factors. 9 of them presented that the enterprise’s degree of attention to human resource management is the key factor in establishing an effective human resource management. 8 of them looked the factor of the enterprise’s organizational culture as the key factor to establish an effective human resource management in their enterprises. Professionals in human resource management was looked by 7 of the interviewees as one of the key factors to establish an effective human resource management in their enterprises, while 7 of them also supported that training is an important factor to determine the effectiveness of the human resource management in Chinese SMEs

Lastly, the interviewees in the research presented many suggestions for Chinese SMEs to solve these possible problems faced by them and improve their human resource management. All the interviewees in the research suggested that their enterprises should improve the attention to the importance of human resource management in the interior of the enterprise. And 8 of them suggested that their enterprises should establish a good organizational culture in the interior of the enterprise. 7 of them suggested that their enterprises should learn experiences about human resource management from the western countries and then combine these experiences in the practice of their human resource management. Moreover, 7 of these interviewees also suggested that their enterprises should foster more professionals in human resource management through education and training, because talents are the basis for human resource management.

4.2.2 Results of Internship Observation 

During the process of research, I ever worked as an internship in Ken Bang Business Investigation Company, which is located in Shanghai of China . This company is one of SMEs in China and is also a good case for the author to study the research question about the current human resource management practices of SMEs in China. That is the reason for the author to choose this company for internship. During the period of internship, the researcher s tudied the research question about the human resource management practices of SMEs in China and research objectives through observation in daily work of the company.

Firstly, although the company has a certain scale of employees and revenues, the company does not have the special and independent department of human resource management. As many small and medium sized enterprises in China, this company focuses more on business rather than management. This company has set up many departments including sales department, marketing department, finance department, service department, computer and network department etc, but does not set up the department of human resource management. In this company, the department of finance takes responsibility for the affairs relating to human resource management, so I work in the department of finance but deal with the affairs of human resource management.

Secondly, this company is a SME and also a private enterprise. The boss and the management of the company do not pay attention to the human resource management. They only care about the business of the company, and don’t pay attention to the aspects of management in the enterprise. They even don’t know the detailed functions of human resource management in the enterprise, and don’t know the importance of human resource management to their enterprise.  In their opinions, the business is the most important to the development of a company. In order to continue to develop to become a large company from a small company, they believe that the company has to invest most of the resources in sales and marketing to continue to increase its sales revenue and the scale in the market. The management of the company knows the gap between the Chinese enterprises and the Western enterprises in human resource management and also knows that the enterprises in Western countries have advanced experiences in human resource management. The boss of the company prefers to learning the advanced experiences in marketing or sales from the western enterprises rather learning experiences of management to enhance the human resource management of the company.#p#分頁標題#e#

Thirdly, although I can take part in the human resource management affairs relating to the company, the only thing related to the human resource management in this company is recruitment and selection. Generally the human resource management of a company should include many aspects such as recruitment and selection, motivation, reward management, training and development, performance appraisal and employee relations. But in this company, recruitment and selection is the only thing related to the human resource management . My work during the period of internship is mainly to publicize the information of recruitment for the company, receive the applications from all the applicants, select the suitable applicants that meet the requirements of the company to the detailed position and then arrange the interviews for them . Besides recruitment and selection, the human resource management of this company does not include any other aspect. company does not have performance appraisal toward the employees, reward management, and training and development to the employees.

Fourthly, this company does not have its organizational culture . All employees of this company just work in this company together and it seems that they do not feel them belong to this company. The company does not pay attention to the human resource management so that it also does not know the importance of human resource to the company. Lack of a good organizational culture  makes this company can not maintain and keep its employees and make them feel that they work in a big family. Without the belonging based on organizational culture, it is difficult for the company to effectively manage their human resource in the company. During the period of working in this company, I did not feel the organizational culture of the company, and did not feel the belongings of other employees toward the company either.

Lastly, there is lack of professional employees in human resource management in this company. Although the company has to involve in some affairs of the human resource management such as recruitment and selection, the company does not have professional employees in this aspect. None of employees in this company has the education background or professional background of the human resource management. So in this company, the affairs of human resource management have to be dealt with by the employees with other background rather than human resource management. This to a large extent has the negative influence on the effectiveness of the human resource management in the company. On the one hand, the company does not realize the importance of professionals in human resource management and doe not want to recruit the relevant professional talents in human resource management from the exterior. On the other hand, the company does not foster its own professional employees in human resource management through the training. In fact, this company does not provide any training to its employees and it is very harmful to the development of the employees in this company.#p#分頁標題#e#

4.3 Findings, Analysis and Discussion

Based on the results from data collection in the research, the findings of the research should be analyzed and discussed relating to research objectives of the study. In this research, the aim of the project is to investigate the current human resource management practices of the small and medium sized enterprises (SMEs) in China. Based on this research aim, there are four main research objectives that are included during the process of the research. The first research objective is to review the relevant literature about human resource management practices in SMEs especially SMEs of China. This has been done in the chapter two of literature review to review the past studies focusing on this research area about the human resource management practices of Chinese SMEs and summarized the key findings from these past studies. These findings are the basis for the further research in our study, and the findings of this research are analyzed compared with the findings summarized from the past studies.

4.3.1 The status quo of human resource management in China’s SMEs

Compared with the long history of human resource management in the enterprises of the western countries, the emergence and development of human resource management in China just has a short history. Although the concept and practices of human resource management have been gradually accepted by more and more enterprises in China, it is still a new thing to most of enterprises in China. Especially for many SMEs in China, there are not familiar with the human resource management compared with some large enterprises in China.

Firstly, the findings of the research showed that there is lack of attention to the human resource management in most of Chinese SMEs. With the encouragement of the government, SMEs in China have experienced very rapid growth and play an increasingly important role in national economy of China. But most of Chinese SMEs do not pay attention to the development of the human resource management practices and realize the importance of the human resource management to the development of SMEs. To most of SMEs in China, the business operation is the core of the enterprise. Sales and marketing, rather than human resource management, is looked by most Chinese SMEs as the most important factor to determine the success and failure of the enterprise in the market. But in fact, the human resource management is a key factor to influence the long-term development of the enterprise, especially for SMEs. It was found in the research of Kasturi et al . (2006) that the attitude of the firm’s owner(s) towards its employees is a major determinant of the firm’s profitability, and on the other hand, the effect of human resource management philosophy on productivity is smaller, albeit still highly significant. Moreover, the findings of the research also suggested that at least for small and medium-sized enterprises (SMEs) in the developing countries, HRM systems architecture is the guiding principle that affects a firm’s performance.#p#分頁標題#e#

Secondly, the findings of the research indicated that most of China SMEs do not think that the human resource management plays an important role in the interior of the enterprise and they think that it is not necessary to set up the independent department of the human resource management in their enterprises. Most of SMEs in China do not believe that the human resource management can bring benefits to the development of their enterprises, and most of them do not have the special department of human resource management and ask other departments such as finance department to deal with the human resource management affairs for the enterprise. This finding is supported by Zhao (2008). In the new century, the competition between enterprises has been more and more intense and the core of the competition is focused on the competition of human resources. It is more and more important for enterprises to have a good human resource management in order to succeed in the market. It was found by Zhao (2008) that most of enterprises especially SMEs in China have not realized the important role of human resources in the development of their enterprises and the importance of managing human resources to the competition of enterprises in the market. The research suggested that upon the background of network, verbalization, diversification and globalization, small and medium sized enterprises in China should make necessary changes in many aspects such as goals, ideas and ways of human resource management in the future in order to survive in the intense competition.

But on the other hand, the finding of Karami et al (2008) supported the importance of human resource management. The findings of Karami et al. (2008) showed that increasing the core competencies of the firm, in particular in HR, is the key element to the success of the firm. Moreover, it was posed that the growing involvement of the HR in the development and implementation of business strategy will lead to the increased effectiveness of the organization and the industry as a whole. Lastly, in order to increase firm performance and to benefit from HR capabilities, it was recommended that practitioners and SME CEOs should increase the involvement of their HR specialists in the processes of strategic management in their firms.

Thirdly, the findings showed that there are obvious differences in the human resource management practices, and the differences are mainly realized in four aspects of history, cultural differences, degree of attention and experiences . This finding is also supported by research evidence of Cunningham and Rowley (2007). Cunningham and Rowley (2007) did a research to emphasise the development, importance and pressure on the under researched area of Chinese small and medium sized enterprises (SMEs) and human resource management (HRM) and provide a review and research agenda especially relating to the debate on convergence vis-à-vis divergence. This research examined recent research papers that are discussed and possible convergence and the pressures on HRM and its practice in Chinese SMEs. In this research, key elements in Chinese HRM are highlighted and four main dimensions of HRM are compared in terms of Western and Chinese characteristics and their cultural impacts and problems based on a conceptual framework to locate influences on Chinese HRM. The findings of the research indicated that the continuing influences on HRM suggest that a distinctly Chinese HRM approach combining Western  practice with Chinese characteristics may be one way for SMEs in China to develop, and it is central to a better understanding of Chinese SMEs and helps fill some of the gap in the analysis of HRM in Chinese SMEs.

Lastly, the findings of the research also indicated that the current human resource management is not effective in Chinese SMEs. For most of SMEs in China, their human resource management is not effective enough to support the operation and management of the whole enterprise and other departments of the enterprise. Harris (2000) considered evidence from a recent survey of small businesses, which examined their main employment concerns and the sources of advice they use on employment relations matters. The survey’s findings illustrate the particular challenge increased employment rights presents to the smaller organisation. It identifies a need for more intensive support tailored to the specific circumstances of individual firms in developing proactive approaches to human resourcing which not only comply with but also reflect the spirit of the legislation.

On the other hand, the human resource management in most of Chinese SMEs does not have the perfect functions and most of them just have the function of recruitment and selection with their human resource management. Human resource management generally should include many functions such as recruitment and selection, motivation, performance appraisal, reward management, training and development, and employee relations. But because most of Chinese enterprises do not pay attention to the human resource management and realize the other important functions of the human resource management, so the human resource management is mainly just used as a simple tool for recruitment and selection in most SMEs of China. This finding is similar to the findings of the research of Jin (2008). Jin (2008) did a research to investigate human resource management of Chinese SMEs on a new vision of globalization. China is gradually involving in world economic system upon the background of economic globalization, and globalization has brought many impacts on many SMEs in China. Human resource management is particularly important to SMEs compared with the large enterprises, but it was found in the research that Chinese SMEs have shortages in many aspects of human resource management such as bias ideas of HRM, inefficient development of human resource and lack of scientific system of human resource management.

4.3.2 Problems involved with the implementation and development of human resource management in China’s SMEs

SMEs have to face more problems including problems of human resource management. The findings of this research indicated that SMEs in China have to face more problems in the human resource management compared with the large enterprises in China. This was also found by the research of Szamosi et al (2004). In that research, it was found that compared with the large enterprises, SMEs have many disadvantages in resources, talents, governmental support, strength, funds etc. so that SMEs have to deal with more problems during the process of developing and implementing the practice of human resource management. Large enterprises have more resources to invest in human resource management, and can attract more professionals in human resource management to work in their enterprises . So they generally have advantages in human resource management than SMEs and can face few problems during the process of implementing the practice of human resource management.#p#分頁標題#e#

There are four main problems to be found involved with the implementation and development of human resource management in Chinese SMEs in this research.

Firstly, the findings of the research showed that lack of attention  is the most important problem faced by their enterprises, because human resource management is generally neglected not only by the management but also by employees. There is lack of atmosphere  of the human resource management in most enterprises including SMEs of China. Not only the management of the SMEs do not attach importance to the human resource management, but also the employees of the enterprise do not pay attention to human resource management because most of them don’t know and understand well of human resource management and its role and functions in the enterprise.

This finding is supported by findings of Zhang and Zhang (2008). They also did a study to investigate the current practices of human resource managements of Chinese SMEs. The authors thought that human resource management plays a core position in modern enterprise management. But due to the speciality of growth and development, SMEs generally have many problems in the aspect of human resource management, and this to a large extent has become one of the important factors to negatively affect the development of SMEs, especially in the developing countries such as China. The research found out three main problems involved with the current human resource management of Chinese SMEs including lack of enough importance toward human resource management and lack of enough atmospheres in the interior of the enterprise.

Secondly, the research findings indicated that lack of a good organizational culture is another important problem faced by Chinese SMEs in developing and implementing human resource management in their enterprises. Most of SMEs in China do not pay attention to the establishment and management of organizational culture. Many of Chinese SMEs do not have organizational culture  and employees do not have the strong belonging (commitment?) to their enterprises. Because of lack of organizational culture, the management of SMEs in China don’t realize the importance of human capital to the growth of their enterprises and either do not realize the importance of managing human resource to the long-term development of their enterprises.

The research Peng (2007) directed focused on the bottleneck problem of human resource management of Chinese SMEs. Similar to the finding of some past studies, the author also thought that as one of the important forces in national economy of China, the existence and development of SMEs in China has be negatively affected by some problems in their human resource management. But different from the findings of some past studies, the author found that the basic factor leading to the bottleneck problem of human resource management for SMEs is their organizational structure and cultural. In most of SMEs in China, the department of human resource management does not have an important position in organizational structure. And lack of good organizational culture makes it difficult for most of SMEs to realize the importance of human capital to the development of their enterprise.#p#分頁標題#e#

Thirdly, the findings of the research showed that lack of experiences in human resource management is also an important problem faced by Chinese enterprises. It has been found in the previous findings of this research that there are many differences between the practices of human resource management in China and in the western countries, and experience in human resource management is one of the important differences for Chinese SMEs and the western enterprises.

Liu (2008) did a research to focus on the dilemma of SMEs in China on the aspect of human resource management and present recommendations for Chinese SMEs to solve their dilemma. It was found in the research that SMEs have become the important forces to drive the development of China’s national economy and society, but the development of SMEs is not stable. The shortage in human resource management has become the important factor to restrict the development of SMEs, especially in the period of quick expansion for the enterprise.

Lastly, lack of professionals in human resource management was also found in the research as an important problem for SMEs in China. The history of the development of human resource management in China is short and the education of human resource management is also very weak. This leads to the fact that it is difficult for the enterprise in China to recruit the excellent professionals in human resource management to help improve the performance of the enterprise in managing human resource. It is the problem that is not only faced by SMEs but also faced by the large enterprises in China.

This finding is supported by the research of Zhang and Zhang (2008) that investigated the current practices of human resource managements of Chinese SMEs. They found three main problems faced by the current Chinese SMEs in the human resource management, and lack of the relevant talents in human resource management is the important problem among these three problems because the talents are the basis for the development and perfect of human resource management and it costs time and resources for the enterprise to foster the excellent professionals in human resource management .

4.3.3 Suggestions that can be recommended for China’s SMEs to solve these problems relating to their HRM practices

Based on the main problems involved with the current practices of human resource management for SMEs in China, the findings of the research also presented recommendations for Chinese SMEs to solve these problems and improve their performance in human resource management.

Firstly, the findings of the research suggested that Chinese SMEs should improve their attention to human resource management. If the enterprise wants to achieve a good effect in human resource management and enjoy the benefits from human resource management, they should first realize the importance of human resource management. When the enterprises pay attention to human resource management, they will invest more resources in the development of human resource management in their enterprises and try to continue to improve it. It is very important for the long term development of human resource management in the interior of an enterprise.

Zhang and Zhang (2008) presented three recommendations in the research for Chinese SMEs to better manage their human resources. The most important recommendation among these recommendations is to enhance the importance of both the enterprise and the employee to human resource management. In the research, their findings emphasized that it is not enough to just enhance the attention of the enterprise’s management to human resource management, and it is very important for the enterprise to make their employees realize the importance of human resource management to the development of the enterprises. The findings of Liu (2008) also suggested that Chinese SMEs should pay more attention to their human resource management in order to solve the current dilemma in human resource management .

Secondly, it was recommended in the research that Chinese SMEs should establish a good organizational culture in the interior of the enterprise. A good organizational culture not only can realize the attention of the enterprises to their employees but also can make the employees have belongs to the enterprise .

Liu (2008) suggested that Chinese SMEs should try to constitute the scientific plan of training and construct good organizational atmosphere in the interior of the enterprise, and this is a key factor for the enterprises to improve effectiveness of their human resource management. Zhang and Zhang (2008) also found that lack of organizational culture is the general situation in Chinese SMEs and is also the important problem to influence the human resource management of Chinese SMEs. So they suggested that it is important for Chinese SMEs to establish a good organizational culture in the interior of the enterprise in order to solve their problems in managing human resource.

Thirdly, another recommendation in this research is for Chinese SMEs to learn experiences from the Western enterprises. As we all know, the western enterprises have more experiences in human resource management compared with Chinese enterprises especially SMEs, so their advanced experiences may be very helpful for Chinese SMEs to achieve a good human resource management. But this recommendation should consider the differences between China and the western countries in many aspects such as the society, culture, and market environment and so on . Cunningham and Rowley (2007) suggested that a distinctly Chinese HRM approach combining western practice with Chinese characteristics may be one way for SMEs in China to develop, and it is central to a better understanding of Chinese SMEs and helps fill some of the gap in the analysis of HRM in Chinese SMEs.

Lastly, the findings of the research suggested that Chinese SMEs should foster more excellent professionals in human resource management, because it is very important for them to improve the performance in managing human resource. The research evidence of Jin (2008) supported that in order to face the challenges of globalization, the findings of the research indicated that Chinese SMEs must gradually perfect their human resource management. It was suggested that Chinese SMEs should change their ideas about human resource management, pay attention to the training of employees, establish the effective system of motivation, and foster the good culture of the enterprise.#p#分頁標題#e#

Zhang and Zhang (2008) also suggested that foster more professional talents in human resource management. On the one hand, the enterprises can try to recruit excellent talents in human resource management. On the other hand, the enterprises can try to foster their own professionals in this aspect through the long-term training and development.

4.4 Conclusion

This chapter presents the results from the research and analyzes findings of the research in terms of research objectives and findings summarized from the literature.As to the status quo of human resource management in China’s SMEs, firstly the findings of the research showed that there is lack of attention to the human resource management in most of Chinese SMEs. Secondly, the findings of the research indicated that most of China SMEs do not think that the human resource management plays an important role in the interior of the enterprise and they think that it is not necessary to set up the independent department of the human resource management in their enterprises. Thirdly, the findings showed that there are obvious differences in the human resource management practices, and the differences are mainly realized in four aspects of history, cultural differences, degree of attention and experiences. Lastly, the findings of the research also indicated that the current human resource management is not effective in Chinese SMEs, and the human resource management in most of Chinese SMEs does not have the perfect functions.

As to problems involved with the implementation and development of human resource management in China’s SMEs, the findings of the research indicated that firstly lack of attention is the most important problem faced by their enterprises, because human resource management is generally neglected not only by the management but also by employees; secondly lack of a good organizational culture is another important problem faced by Chinese SMEs in developing and implementing human resource management in their enterprises; thirdly lack of experiences in human resource management is also an important problem faced by Chinese enterprises; lastly lack of professionals in human resource management was also found in the research as an important problem for SMEs in China.

As to suggestions that can be recommended for China’s SMEs to solve these problems relating to their HRM practices, it was suggested in the research that Chinese SMEs should first improve their attention to human resource management; secondly establish a good organizational culture in the interior of the enterprise; thirdly, learn experiences from the western enterprises to combine in practices of human resource management; lastly foster more excellent professionals in human resource management.

Chapter Five Conclusions and Recommendations

5.1 Review of Research Findings

The aim of this project is to investigate the human resource management practices of small and medium sized enterprises (SMEs) in China. There are four main research objectives in this research. The first is to review the relevant literature about human resource management practices in SMEs; the second is to investigate the status quo of human resource management in China’s SMEs; the third is to find out problems involved with the implementation and development of human resource management in China’s SMEs; and the last is to present suggestions that can be recommended for China’s SMEs to solve these problems relating to their HRM practices.

The research is mainly based on the primary research including interviews conducted with some SMEs in China and the direct observations of the researcher through the internship in a SME in Shanghai of China. But the research also use the secondary data that are collected from the public sources including the published book and journal article, online database and some websites. The findings of the research are based on results from interviews with ten Chinese SMEs and the direct observation of the researcher in a SME in Shanghai of China.

During the period of internship, the researcher studied the research question about the human resource management practices of SMEs in China and research objectives through observation in daily work of the company. Firstly, although the company has a certain scale of employees and revenues, the company does not have the special and independent department of human resource management. Secondly, this company is a SME and also a private enterprise. The boss and the management of the company do not pay attention to the human resource management. They only care about the business of the company, and don’t pay attention to the aspects of management in the enterprise. Thirdly, although I can take part in the human resource management affairs relating to the company, the only thing related to the human resource management in this company is recruitment and selection. Fourthly, this company does not have its organizational culture. All employees of this company just work in this company together and it seems that they do not feel them belong to this company. Lastly, there is lack of professional employees in human resource management in this company. Although the company has to involve in some affairs of the human resource management such as recruitment and selection, the company does not have professional employees in this aspect .

Based on the results from data collection in the research, the findings of the research are analyzed and discussed relating to research objectives of the study. The first research objective is to investigate the status quo of human resource management in China’s SMEs. Firstly, the findings of the research showed that there is lack of attention to the human resource management in most of Chinese SMEs. With the encouragement of the government, SMEs in China have experienced very rapid growth and play an increasingly important role in national economy of China. But most of Chinese SMEs do not pay attention to the development of the human resource management practices and realize the importance of the human resource management to the development of SMEs. To most of SMEs in China, the business operation is the core of the enterprise. Sales and marketing, rather than human resource management, is looked by most Chinese SMEs as the most important factor to determine the success and failure of the enterprise in the market. But in fact, the human resource management is a key factor to influence the long-term development of the enterprise, especially for SMEs. It was found in the research of Kasturi et al (2006) that the attitude of the firm’s owner(s) towards its employees is a major determinant of the firm’s profitability, and on the other hand, the effect of human resource management philosophy on productivity is smaller, albeit still highly significant. Moreover, the findings of the research also suggested that at least for small and medium-sized enterprises (SMEs) in the developing countries, HRM systems architecture is the guiding principle that affects a firm’s performance .

Secondly, the findings of the research indicated that most of China SMEs do not think that the human resource management plays an important role in the interior of the enterprise and they think that it is not necessary to set up the independent department of the human resource management in their enterprises. Most of SMEs in China do not believe that the human resource management can bring benefits to the development of their enterprises, and most of them do not have the special department of human resource management and ask other departments such as finance department to deal with the human resource management affairs for the enterprise. It was found by Zhao (2008) that most of enterprises especially SMEs in China have not realized the important role of human resources in the development of their enterprises and the importance of managing human resources to the competition of enterprises in the market .

Thirdly, the findings showed that there are obvious differences in the human resource management practices, and the differences are mainly realized in four aspects of history, cultural differences, degree of attention and experiences.

Lastly, the findings of the research also indicated that the current human resource management is not effective in Chinese SMEs. For most of SMEs in China, their human resource management is not effective enough to support the operation and management of the whole enterprise and other departments of the enterprise. On the other hand, the human resource management in most of Chinese SMEs does not have the perfect functions and most of them just have the function of recruitment and selection with their human resource management. Human resource management generally should include many functions such as recruitment and selection, motivation, performance appraisal, reward management, training and development, and employee relations. But because most of Chinese enterprises do not pay attention to the human resource management and realize the other important functions of the human resource management, so the human resource management is mainly just used as a simple tool for recruitment and selection in most SMEs of China.

The second research objective is to find out problems involved with the implementation and development of human resource management in China’s SMEs. SMEs have to face more problems including problems of human resource management. The findings of this research indicated that SMEs in China have to face more problems in the human resource management compared with the large enterprises in China. There are four main problems to be found involved with the implementation and development of human resource management in Chinese SMEs in this research.

Firstly, the findings  of the research showed that lack of attention is the most important problem faced by their enterprises, because human resource management is generally neglected not only by the management but also by employees. There is lack of atmosphere of the human resource management in most enterprises including SMEs of China. Not only the management of the SMEs do not attach importance to the human resource management, but also the employees of the enterprise do not pay attention to human resource management because most of them don’t know and understand well of human resource management and its role and functions in the enterprise.#p#分頁標題#e#

Secondly, the research findings indicated that lack of a good organizational culture is another important problem faced by Chinese SMEs in developing and implementing human resource management in their enterprises. Most of SMEs in China do not pay attention to the establishment of organizational culture. Many of Chinese SMEs do not have organizational culture and employees do not have the strong belonging to their enterprises. Because of lack of organizational culture, the management of SMEs in China don’t realize the importance of human capital to the growth of their enterprises and either do not realize the importance of managing human resource to the long-term development of their enterprises.

Thirdly, the findings of the research showed that lack of experiences in human resource management is also an important problem faced by Chinese enterprises. It has been found in the previous findings of this research that there are many differences between the practices of human resource management in China and in the western countries, and experience in human resource management is one of the important differences for Chinese SMEs and the western enterprises.

Lastly, lack of professionals in human resource management was also found in the research as an important problem for SMEs in China. The history of the development of human resource management in China is short and the education of human resource management is also very weak. This leads to the fact that it is difficult for the enterprise in China to recruit the excellent professionals in human resource management to help improve the performance of the enterprise in managing human resource. It is the problem that is not only faced by SMEs but also faced by the large enterprises in China.

The last research objective is to present suggestions that can be recommended for China’s SMEs to solve these problems relating to their HRM practices. Based on the main problems involved with the current practices of human resource management for SMEs in China, the findings of the research also presented recommendations for Chinese SMEs to solve these problems and improve their performance in human resource management.

Firstly, the findings of the research suggested that Chinese SMEs should improve their attention to human resource management. If the enterprise wants to achieve a good effect in human resource management and enjoy the benefits from human resource management, they should first realize the importance of human resource management. When the enterprises pay attention to human resource management, they will invest more resources in the development of human resource management in their enterprises and try to continue to improve it. It is very important for the long term development of human resource management in the interior of an enterprise.

Secondly, it was recommended in the research that Chinese SMEs should establish a good organizational culture in the interior of the enterprise. A good organizational culture not only can realize the attention of the enterprises to their employees but also can make the employees have belongs to the enterprise. Liu (2008) suggested that Chinese SMEs should try to constitute the scientific plan of training and construct good organizational atmosphere in the interior of the enterprise, and this is a key factor for the enterprises to improve effectiveness of their human resource management. Zhang and Zhang (2008) also found that lack of organizational culture is the general situation in Chinese SMEs and is also the important problem to influence the human resource management of Chinese SMEs. So they suggested that it is important for Chinese SMEs to establish a good organizational culture in the interior of the enterprise in order to solve their problems in managing human resource.#p#分頁標題#e#

Thirdly, another recommendation in this research is for Chinese SMEs to learn experiences from the western enterprises. As we all know, the western enterprises have more experiences in human resource management compared with Chinese enterprises especially SMEs, so their advanced experiences may be very helpful for Chinese SMEs to achieve a good human resource management. But this recommendation should consider the differences between China and the western countries in many aspects such as the society, culture, and market environment and so on. Cunningham and Rowley (2007) suggested that a distinctly Chinese HRM approach combining western practice with Chinese characteristics may be one way for SMEs in China to develop, and it is central to a better understanding of Chinese SMEs and helps fill some of the gap in the analysis of HRM in Chinese SMEs.

Lastly, the findings of the research suggested that Chinese SMEs should foster more excellent professionals in human resource management, because it is very important for them to improve the performance in managing human resource. The research evidence of Jin (2008) supported that in order to face the challenges of globalization, the findings of the research indicated that Chinese SMEs must gradually perfect their human resource management. It was suggested that Chinese SMEs should change their ideas about human resource management, pay attention to the training of employees, establish the effective system of motivation, and foster the good culture of the enterprise.

5.2 Limitations

There are several limitations involved with the project. Firstly the research topic of investigating the current human resource management practices of Chinese SMEs may be too big for the researcher to conduct an in-depth investigation and analysis. Secondly, due to the limitations of time and resources, it is impossible for the researcher to include all SMEs of China in the sample of the research, and only ten SMEs were chosen  from these SMEs as the representatives in the research. But these ten SMEs may not represent the situations of all the SMEs in China, and problems of human resource management faced by them may be different from problems faced by other SMEs in China. Thirdly, both the primary data and the secondary data are collected and used in this research. Bias may exist  during the process of data collection and this may have a negative effect  on the accuracy of research findings.

5.3 Recommendations for Further Research

This research just simply investigates the human resource management practices of Chinese SMEs. Based on the findings of this research, there are some recommendations for further research focusing on this research area. Firstly, because it was found that there are many differences between practices of human resource management in China and in the western countries, so the further research could be undertaken to critically compare and contrast the practices of human resource management in China and those in the western countries . Secondly, because it was found that SMEs have to face more problems involved with human resource management compared with the large enterprises in China, so further research could be undertaken to compare practices of human resource management in SMEs and large enterprises in China. Thirdly, because the research topic is too big for the research to conduct an in-depth investigation, so the further research could be undertaken to focus on SMEs in a special industry to do an in-depth investigation and analysis

Thesis customized service modification suggestion sample

Chapter Two Literature Review

Chapter Three Research Methodology

Chapter Four Results and Analysis