China and the Global Water Talent Market

In spite of the ongoing rocky global financial situation, H2Otalent has been busy, and the fact that I have not posted to this blog for six months (sorry!) is a good indicator of this.

We can largely thank China for this…as a resources industry exposed Asia-Pacific based business we are inside the China growth bubble.

I am convinced that China is going to continue to be the main water industry growth story for the forseeable future, both due to the big catch-up job they have on their hands with municipal and industrial water and wastewater treatment, but also because China is so water resource constrained that they are going to need a lot of technology to facilitate further growth.

It makes sense then that at least one leading global water technology business is running their global water business out of China. This glocalisation trend makes a lot of sense, because if you don’t get your head around doing business from what recently became the world’s second biggest economy, you can bet that the China based business that is eyeing off your market is going to enter with a significant cost-advantage.

This glocalisation trend creates a very interesting talent dynamic, because multinationals then need to employ international business savy Chinese engineers without driving up their China cost base excessively.

In my view they are going to have to accept, as Chinese firms will have to do, that the talent cost of running a global business out of China is going to be higher than running a domestic one. The only way to find Chinese engineers who have extensive multinational experience is to pull expats back from overseas, and these guys have mortgages and kids in school in Sydney or LA, and are not in a position to take salary cuts to work back in China…even if they want to.

H2Otalent is setting up a Shanghai office in January ’11, primarily to serve global water businesses operating in China. See you there!