The era of the knowledge economy has arrived. Competitiion beween companies in the future will depend largely on the ability to attract and retain high-quality employees. China’s entry into the WTO pushes forward its participation in globalization and exposes the SOE’s to heavier competition and greater challenges. HRM reform of SOE’s in China is at the top of the reform agenda. Empirical studies show that national culture affects the operation and efficiency of HRM in organizations. According to Robert M. Verburg, HRM methods differ across different cultures and Mark Easterby-Smith has argued that HRM is cultural sensitive. Thus to understand the troubles SOE’s face, we must take Chinese culture into consideration. In this essay, the author examines Chinese culture (especially the role of the government, the economic system, religion and work-related values) according to Hofstede’s theory and its negative influence on the traditional personnel system, which contributes to the problems SOE’s face. Finally, the author make some reccomendations for HRM reform in SOE’s and adapts Western methods to fit into the Chinese cultural context. IntroductionThings are different now. Great changes have taken place in the global social and economic environment. During the Agricultural Age, the basis for development was land and natural resources. During the Industrial Age, the basis for development was capital and machinery. During the Information Age, the basis for development is knowledge. The era of knowledge economy has arrived. Knowledge becomes a must for the development, or even the existence of all the companies. It comes to be an important course for the enterprises facing the new economic situations to learn how to attract, manage, utilise and retain the human resource that possess the knowledge they need. The advent of knowledge economy requires companies to form a new concept of HR, that is, ...
