Course Project
Course Project
The paper will provide in-depth comparative analysis between the operations of Microsoft Inc in Japan and China. Microsoft Inc is a multinational company that deals with the manufacturer of computers and software products. When seeking to invest in foreign markets, it should be aware of the macroeconomic environments associated with the various markets. The main differences between the Japanese and Chinese economy can be understood through the understanding of the different economic system inherent in each country. For instance, in 2000, the GDP growth rate was close to 8 percent in China and 1.3 per cent in Japan (Zhu, Cooper, Fan & De Cieri, 2013). It implies that Microsoft Inc has a huge opportunity to benefit from the growth of the Chinese economy. Therefore, the paper will conduct a comparison of the economic viability and HR trends in Japan and Chinese for the success of Microsoft Inc.
Under the various market capitalism models, the culture of saving is similar to that of Japan. However, in the mixed socialist model, the Chinese citizens have the power to control the amount of savings and thus, always lead to lower amount of savings. The Chinese government has the power to control the investment rates in contrast to the capitalism model, which demeans the purpose of the government in the economic activity. The differences between the GDP growth levels are attributable to the Japan’s previous extreme growth. Apart from all, China should have adequate space for economic growth. Thus, nature of the economic systems of Japan and China significantly affects the success of Microsoft Inc. In China, only around 25 percent of the labor force works in the service industry, while in Japan, only 65 percent of the employee who works in the service industry (Nolan, 2014). It implies that Microsoft Inc could benefit from the increased population of workers in the service industry in Japan unlike in China.
There are also exists significant differences between the standards of living among the Chinese and Japanese individuals due to the nature of their different economic systems. Some of the main indicators of the living standards are the ownership of cellular phones and televisions in the economies. Japan has more cellular phones than that of the Chinese people (Morrison & Labonte, 2013). Japan has close to double the number of broadcast stations present in China. The usage of internet in Japan is higher than that of China. In spite of the high population in China, Japan offers a better-living standard.
Apart from all, the China and Japan shares various aspects including religions, geographical areas, and philosophies among others. However, the differences in the two countries come from the different economic systems as developed through the histories. Japan used the market capitalism model, which is similar to the current American culture (Nolan, 2014). The Japanese economic model is concerned with the creation of material wealth and leisure among others. In contrast, China has followed a more conservative model and transitioned from the planned socialism towards enhancing fundamental market socialism.
In terms of the workforce changes, the voluntary turnover within the technology industry in China was higher than that of Japan. This implies that it is highly likely to retain employees in Japan than in China. Employee retention is important in enhancing the consistent performance of the company. In terms of salary budget, China had a higher salary increase than Japan at 8.5 percent and 3.1 percent. In technology industry, the salaries of the Chinese employees, are 20 percent to 100 percent of the U.S professionals (Zhu et al., 2013). In contrast, Japan accounts for 83 percent of the U.S 100 percent. It indicates that it is less costly to hire employees in China than in Japan.
According to the Morrison and Labonte (2013), in China, HR policies encourages the use of the pay incentives in terms of performance. It aligns to the traditional U.S HR policy to enhance the performance of the employees. In both countries, China and Japan, the HR policy relies on the financial incentives to promote the performance of the employees. Microsoft Inc should develop incentive pay systems to enhance the productivity of the employees. However, Microsoft Inc should develop a standardized HR management systems and policies to deal with local HR issues. China and Japan are among the Asian economies that continue to grow at a faster pace as the labor demand increases, more so among the highly skilled and executive positions (Varma & Budhwar, 2013). It has lead to the increased pressure to increased salary and compensation benefits in both countries. Microsoft Inc should continue managing its compensation with a global understanding and frameworks that are consistent to the national pay scales.
Labor and industrial relations are important aspects, which affects the success and operations of Microsoft Inc in the Asian countries. Both nations, China, and Japan have improved their labor relations significantly. It includes the establishment of the social security policy and human relations in the economies. The labor unions has also collaborated with firms to increase the productivity of the companies (Morrison & Labonte, 2013). Under the current industrial and social changes, both the Chinese and Japanese governments have established laws and regulations to ease employee relations as well as promoting their rights. However, China has been blamed for the lack of stricter regulations to eliminate child labor and abuse. Microsoft Inc should be keen to avoid child abuse and labor in China to maintain its reputation and brand image.
In summary, Japan and China are vibrant growing economies due to the recent economic growth data. Both economies share various similarities except geographical proximity. The economies have right cultures and a strong sense of national identity. The countries also comprise of similar religions and value systems. However, Microsoft Inc should understand the differences in the trend of the countries’ economic policy. In terms of human resource management policies and practices, the economies have developed significant HR policies to handle HR problems. In spite of all, China faces increased criticized due to the cases of child labor. Therefore, it is advisable for Microsoft Inc to invest highly in Japan than China, which has better economic and working conditions.
References
Morrison, W. M., & Labonte, M. (2013). China’s currency policy: An analysis of the economic issues. Congressional Research Service, 49.
Nolan, P. (2014). Globalisation and industrial policy: The Case of China. The World Economy, 37(6), 747-764.
Varma, A., & Budhwar, P. S. (2013). Managing human resources in Asia-Pacific (Vol. 20). London, UK: Routledge.
Zhu, C. J., Cooper, B. K., Fan, D., & De Cieri, H. (2013). HR practices from the perspective of managers and employees in multinational enterprises in China: Alignment issues and implications. Journal of World Business, 48(2), 241-250.
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