Competitive Advantage, Human Resource Strategy, and the 2008 Olympics

People & Strategy, March 2008 | Go to article overview

Competitive Advantage, Human Resource Strategy, and the 2008 Olympics


Jeremy B. Fox, Ph.D.

Department of Management

Appalachian State University

Boone, NC

Joan M. Donohue, Ph.D.

Department of Management Science

University of South Carolina

Columbia, SC

Jinpei Wu, Ph.D.

Department of Management

Virginia Tech

Blacksburg, VA

China, by hosting the 2008 Olympics, hopes to create not only economic payback, but, more importantly, long-term national public appeal. The following statement by Fowler (2006) gives witness to this "best face" goal:

   Sun Weide, a former press official for
   the Chinese Embassy in Washington,
   works extensively with Hill &
   Knowlton (PR consulting). He says
   his main message is to emphasize
   China's development and Beijing's
   technological, social and environmental
   approaches to running its Games.

An organization hoping to achieve some specific goal must look at the planning and strategies it intends to implement by asking, "Will the actions of our organization serve to achieve that goal?" In the case of the 2008 Beijing Olympics, and considering China's globally competitive labor cost advantage, we are led to examine a project goal in the context of strategic human resource management. Specifically we consider whether, in the long term, Olympic exposure will allow the country to make a "great leap forward" and become an incubator for top global companies. (See Gadiesh, et al., 2006, for a fulsome discussion of this specific point.)

Ultimately, the measure of "success" in human resources often has been the cost of providing performance, rather than a strategic accomplishment measure of that performance for the organization.

In the example of HR misalignment, explained later, the reader can discern how China's traditional globally competitive advantage of cheap, compliant labor, often supplied with limited government oversight, is now misaligned with China's "hypermission" of favorably impressing the world during its hosting of the 2008 Olympic Games in Beijing.

Hutzler (2005), a columnist in The Wall Street Journal, reports:

   China's communist leaders want to
   showcase the country's rising wealth to
   the world and enhance their popularity
   with their own people, while local
   governments are using the event to
   promote their own agendas. "Anything
   that involves a crane is called an
   Olympics project," says an executive
   with the China subsidiary of U.S.
   conglomerate General Electric, a top
   Olympics sponsor.

China hopes, as do all hosting countries, to show a profit (see Owen, 2005, for a strong contrarian point of view on the potential for profit). More importantly, China wants to show off the country to the world in a light that will put China on the world's stage of important countries for sports, entertainment, and technology, and highlight it as a country that can follow through on projects and "make things happen."

In the face of the nation's excitement over being selected to host the Olympics, a National Peoples Congress (NPC) deputy unconsciously raised the specter of disastrous risk associated with detrimental labor outcomes when he said: "The organizers of the event should exert all efforts to present the best ever games to the world with the minimum amount of expenditure" (Shanghai Daily, 2006); however, if, in using this existing globally competitive advantage, China's Olympic HR process utilizes underpaid and poorly treated employees as perceived by the world at large, its "desired goal" may be replaced by another less desired, unintended, and detrimental outcome: a public relations (PR) problem.

Reports have come out about abused Olympic-related labor. The Human Rights Watch (2006) reports substantial worker unrest on Olympic projects because of pay issues. This is not an issue unique to any one country. …

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