Don’t blame the rat: Chinese enterprises need to invest in people beyond salary

Have you ever heard one of your senior executives say, in effect, “We in management are trying to drive transformation in our company. You people are resisting change.” When I heard this finger-pointing by a foreign boss in a room full of Asian managers recently, my mind connected back to my old business school professor, Steve Kerr, who used to say “Don’t blame the rat.” In other words, look to the cheese—the rewards that drive action.

Days ago, my mind returned to the phrase during conversation with a client on the subject of rewards and retention in China. I found myself re-phrasing the line, in an effort to put rewards in context. "We're suffering from a high level of departures. Some of our best people are leaving over compensation. We need to increase pay," my client said. I responded, "Don't blame the cheese."

While careful not to minimize the importance of pay in China, I truly wonder whether paying at the 50 percentile or 75 percentile is going to make much of a difference in a country where managers routinely get 50 percent increases in pay to jump to a competitor. Getting your business right in China requires a more systemic approach to leadership and talent management. To the highly accountable Chinese mindset, how much you invest in my career, how I'm recognized among my peers, and what I'm being measured on are just as important as pay. These define the cheese and explain why great companies place emphasis on action learning, challenging assignments, "talking talent" among the leadership team, and hiring the right talent in the first place. And why leaders need to 'own' the transformation. Small wonder, then, that at the first sign of finger-pointing by a foreign boss, an unseen pall fills the room with thoughts of finding the exit. And thoughts of more cheese.