Here in my home country the US, nepotism is unanimously scorned upon. A workplace romance has almost as much notoreity among coworkers — if not more — than the local celeb gossip. Employers caught hiring their relatives risk expulsion from their jobs — or worse. Instead, we bow to the American ideal of workers garnering new jobs based on their qualifications.

(Never mind, of course, the fact that networking — or rather WHO you know — is often what gets you in the door. But I digress…)

The point here is, we can’t imagine a workplace that encourages the hiring of friends and relatives of employees.

But if you’re setting up an office in China, you should imagine this kind of workplace — and cultivate it. Why? Because it could mean the difference between retaining and losing good employees.

My former employer, Global Sources, proudly employed a number of prominent couples. My production manager and our IT manager. The client service center manager and a big sales manager in Hong Kong. Two HR managers. As for friends, while I can’t speak for the entire company, just about every single artist in our department could be traced back to one fellow. Meanwhile, our HR department provided hefty monetary incentives for recommending people to work at the company — a sort of employee-referral affiliate program, if you will. This policy was drilled into our brains through e-mails and department meetings, lest we ever forget the potential rewards.

Companies such as Global Sources are banking on one immutable aspect of Chinese culture — loyalties lie more with your friends and relatives, not necessarily an organization or company.

Of course, that can work against you. One of Global Sources’ largest competitors, Global Market, was started by an Global Sources account executive who walked off with a healthy rolodex and a few coworkers.
So what does that mean for you? Three words: relationships, relationships, relationships.

Hire people based on employee referrals — and provide incentives to encourage these referrals.

Promote friendships and relationships within the workplace. Provide ample social outings, long/short-term trips, exercise clubs, and anything else you can do to make it a family atmosphere. Global Sources created a tennis competition that encouraged employee exercise and camaraderie.
Go a step further by offering value-added training opportunities. At Global Sources, we offered after-work English classes.
Remember, ties to family and friends will always trump your company, no matter how good you are; if family and friends are with the company, chances are your best employees will stay.

Watch relationships. Personal dynamics, if you don’t pay close attention, could mean disaster for your company — especially if too much power gets in the hands of one manager. Make sure you’re continuously reaching out to your employees in a personal way. What you don’t know or notice might hurt you.