Every industry experiences disruptive changes every few years or so. But in China’s highly competitive consumer industry, new market changes can blow in every few months.
China’s consumer market is set to grow unabated, not only in size but also in dynamism and complexity. Its e-commerce market is on its way to become world’s largest. Consumer segments are becoming more fragmented. Online and offline business integration is accelerating. New government regulations are being introduced to protect consumers. More mergers and acquisitions are on the rise. These are just a few of the market dynamics retail and consumer brands face in China, on top of surging rental and labor costs.
The New Manager to “Run the Windmill”
Not unlike the Chinese proverb that says, “When the direction of the wind changes, some build walls, while others make windmills,” consumer brands know they need to keep developing effective new strategies quickly and capture the opportunities (windmills) in order to survive in China.
As the Chinese consumer market matures, companies need executive talent who will help them answer important strategic questions such as:
- Which of China’s more than 650 cities should we focus on?
- How do we capture new emerging categories of consumers? What are their spending patterns? Where are they located?
- What should our product and brand mix be in five to 10 years’ time?
- What are the most profitable price points and product positionings for us?
- Where should we invest our local research and development (R&D) initiatives?
This highly complex game in an increasingly fragmented market has driven the emergence of a new senior executive role at retail brand owners operating in China: the strategic business planner, who directly reports to the China CEO.
This trend started around 2011 and has picked up in momentum recently. Some of the strategic planning candidates placed over the last three years say that they now get a few calls a weeks from other business-to-consumer (B2C) companies hoping to recruit them to do the same thing for them. This shows that this position—which wasn’t even heard of a few years ago—is very much in demand today.
The role and Its Recruitment Challenges
While the rest of the organization will focus on running the China business, these newly created strategic planning roles focus on creating a plan for the future. As such, strategic business planners need to understand complex information related to future events and devise a way to capitalize on current opportunities and future trends. To do this, they have to understand what drives the business and grasp big-picture issues. They also should be adept at data analysis and risk management.
The best fit for retail and consumer brands is a mix of marketing, finance, and analyst capabilities—a combination that isn’t easily found in China’s existing talent pool.
Beyond the Typical Job Description
The fact is the strategic planning role in China’s B2C market is not mature yet, and candidates with ideal profiles (much less candidates with proven track records) simply do not exist.
The closest roles are probably financial business analysis or marketing leaders, but not a combination of the two. Hence, hiring managers and their executive search consultants will have to look for candidates with the “best fit” of skills and the potential to grow quickly into the role. Hiring internally is usually not an option since the entire purpose is about acquiring a fresh, objective perspective.
In drawing up job descriptions, we advise clients to be open to considering executives either with financial or marketing backgrounds, who have strong analytical and communications skills, and who are able to lead a small team of financial analysts from other B2C sectors. For example, businesses selling personal care, nutrition, or cosmetics products may consider candidates from the fast-moving consumer goods industry, and vice versa.
Good candidates must have an excellent understanding of China’s consumer market. They will exhibit strong analytical skills, and have at least 10 to 15 years of work experience, preferably in large B2C multinationals.
Given the breadth of influence they will need to have throughout the organization, they also should have the ability to communicate with senior management in global headquarters, as well as local sales teams who may be located in opposite ends of China and have their own expectations, cultural nuances, and market dynamics. Hence, candidates who have worked in highly complex environments would be preferred.
Ensuring Success Beyond Placement
We have noticed that identifying and placing bright promising candidates into newly created roles is one thing; ensuring their future success is entirely another.
Strategic planners in China’s retail and consumer good sectors will step into organizations that previously have only experienced mouth-watering growth rates, with well-established sales or regional teams likely to resist changing what they see as “the way things are run here.” The resistance may be even stronger when the strategic planner is externally placed and seen as the “new kid on the block.”
For newly created strategic roles to gain traction and make a positive impact, several factors will determine success. Here are just three examples:
- The CEO’s support: The CEO must ensure that everyone understands the threats to their collective future, and that the strategic planner is here to help the company remain successful, and not change things just for change’s sake. In essence, the CEO must throw his or her full support behind the role and communicate that clearly and without reservation.
- Meetings with key stakeholders: The strategic planner is likely to face a mature and stable executive team who have been used to many years of success. Being placed from outside the company, the strategic planner will need to invest a lot of time travelling and meeting people, getting buy-in from key stakeholders, and educating them on the any new direction, regardless of how arduous this process may be.
- Time: As the role supports business heads, the strategic planner is not a direct business or profit generator, and the results may not be evident until after two years. So any new executive needs to be given time.
Creating new strategic roles is never a walk in the park, but sufficient time for executive onboarding and learning is critical—certainly a challenge in China’s fast-changing market.
Tanya Lau is head of the Consumer Practice in Greater China at CTPartners with more than 10 years of executive search experience for Greater China. She can be contacted at tlau@ctnet.com or +852 3983 2029. CTPartners is a performance-driven executive search firm serving clients around the globe. Since 1980, CTPartners has served clients with a global organization of more than 400 professionals and employees, offering expertise in board advisory services and executive recruiting services in the financial services, life sciences, industrial, professional services, retail and consumer, technology, media, and telecom industries. Headquartered in New York, CTPartners has 30 offices in 18 countries.
