Doing China for less money is a dream and one way has short term success and another one long term.
China is a top-down high power distance leadership culture.
In Chinese SOE’s, usually the top leader is the only genius and holds all power while placing all blame elsewhere. China has done this for generations. Part of this is that Chinese leaders trust no one and thus do not give any power to anyone. Pat if that the fear competition, so like hiring C players,
We often see companies where the Chinese or ethnically Chinese leader for a Western Company in China uses the be the only genius model. This can happen in any ethnicity but is extremely clear here.
Doing China for Less Money and More Value Over Long Term is Hard
In this model, he or she lowers costs, by hiring worthless people who do not dare to complain and do not hold a candle to him. They cost little money, but hiring is slow and the reactiveness of the China business is based on how much the top leader can do in each 24-hour day. They tend to be workaholics and have their mitts in everything. Everyone else has to get back to you later as only the top leader can decide anything. The leader will punish anyone who wants to show how smart they are. Only people of low self esteem and properly cowed can survive in this model.
The common model seen in slightly more Westernized Western Companies in China will see leaders who have high power distance issues but not as extreme,
The result of this solution is they develop a high-cost model. They may hire decision makers and people of value but certainly no one to threaten them. They have lots of salary complaints and pressure under them as the leader makes them unhappy. Be sure, complaints against salary are a sign of bad leadership.
In my 25 years of leading organizations in China, I have seen that low power distance leadership allows me to hire A level Rock stars and pay them reasonable wages but not have to compete on salary as severely. My people will not leave for money. When we place leaders for our customers, usually the leaders will start to work out the same models.
This model provides a high value medium cost solution as hiring and retention are not tied as tight to salary. These organizations produce high value that cannot be reached by other models over time.