Tactics and preparation for letting go of your general manager.
So you have your board resolutions, banking info clear, retained a law firm with China experience and affiliates, drafted a severance deal, a forensic accountant on board perhaps: time to plan your trip over.
Timing: go near the beginning of the month so you have time to stabilize before bills and payroll come due. Ever seen a million RMB? I have because I once helped take out a grey-market cash loan to make payroll because we went mid-month and couldn’t access the accounts in time. Do it Monday or Tuesday, and have lots of lunches and dinners with the staff throughout the week.
Who goes: The legal rep, controller, legal, managers with good relations with staff, especially if there’s a diagonal-line relationship, and as much executive as you can spare. You may need to get local translation assets in place for such a large team. If you’re privately held, as many stakeholders as possible.You have to both fill a massive leadership void and convey confidence that you’re doubling down, not pulling up stakes.
At this point, if you still think he doesn’t see it coming, book everything yourself, make sure visas are all good from a previous trip, and advertise the trip as a small team for normal review/relationship building. Include the legal rep and person with firing authority on the ‘official’ itinerary. If you’ve tipped your hand the important thing is to get on the ground ASAP.
Here you may feel how unprepared you really are. Do you even know how to get to the plant without the company driver? Your local consultants, be they lawyers, accountants what have you, can help. The unannounced team can be meeting with them while the official party moves on to meet with the GM.
Have you decided on a transition period or to escort her out the building? A promotion to SVP of international corporate identity? Depends on the relationship and situation. However if you’re afraid of shenanigans and don’t have a locally capable asset to constantly watch what she’s doing, you may have to make it abrupt for safety, and also to lift the pall of fear off the local staff.
Regardless of the deal, the main point is that the payout doesn’t happen until you’ve verified you have full control of all accounts and other administrative functions. Also make sure China HR requirements are met in addition to corporate governance. I’m assuming you’re offering much more than necessary, but she may still want time to confer with her resources. Make it clear she’s leaving the building today either case. This is tricky, because you may not have all the legal firepower, but you have the practical power, so as long as you’re not antagonistic you should be able to get her out. Wait it out if you have too; don’t even have security touch her unless she’s belligerent.
If she’s fundamentally playing ball, while I urge you to keep your guard up, you should have a reasonable path ahead of you. Mainly watch out that who she’s recommending really has the goods and is not a patronage appointment.
So I’ll continue assuming you escorted her out of the building at about 4:30 PM. Standard deal, email, cell phone, etc…cut off. Have a good understanding of how your IT works so they don’t have remote access. That includes making it clear to your personnel who they now work for. If she controls the corporate WeChat, QQ, etc…make sure that’s transitioned.
Don’t hide. Make sure the bosses sort of walk her out as she says goodbye, along with someone who understands what she’s saying. Keep an eye on her cronies the whole time. Video coverage is good. I’ve seen people steal laptops and samples on their behalf. Smile and make it seem as mutually beneficial as possible. She’ll have no incentive to make it worse. Shake hands outside the building and wish her well if you feel that’s what she wants. If she wants to anonymously disappear that can also work for you, but be wary as to why. Assign someone on your team so she can come back and pack her things after everyone else has left unless you can do it for her.
If you don’t have security, consider temporarily hiring some or lock the place down at night with someone manning front desk during the day with the nerve to keep her out.Your staff likely won’t. An expensive but convenient option for Westerners to work with would be someone like Hill & Associates who will do local contracting for you as well as give practical advice. Your call on whether it’s necessary or not. If you don’t really understand the overall situation, it may help you sleep better.
At 4:45 assemble the factory and release a statement with a translator, delivered by the highest-ranking owner. Main points are pretty standard copy but here you go:
– Mr. xxx has taken us through an incredible period of growth, and we appreciate all he has done
– We feel that in this next phase of development a different skill set and background will better serve the company and our prospects, and wish him well in his next endeavors in a new industry (because with what you paid him, it included a non-compete right?)
– Many of you are worried about the changes (read terminations). We will be evaluating things from top to bottom and expect a period of continued change until we achieve stability (You know more is coming down the pipe. Be up front and honest about it; it may help things settle faster.)
– Our search for a new general manager is well underway, and we hope to announce that shortly
– Our vision is greater co-operation and support between our entities. Respecting your local needs and sensitivities but making us a more globally unified company, and to be the number 1 company in our field.
– We are NOT reducing investment, but expanding, which is why we have decided a new kind of leadership is required. There will be opportunity for advancement and training, so let your managers and directors know your ambitions. We are also offering cash bonuses for ideas that save the company money or make more revenue.
In the meantime, daily business will continue, with reporting temporarily working like this: xxx
Make sure there’s an org chart. They love and respect org charts, and understand that temporary promotions can’t turn into demotions later without trouble.
You need senior leadership to stay on the ground for a few reasons:
– Continuity and confidence
– Assess what is lacking that your new GM has to bring
– Sort out the admin and legacy
A lot of information is going to shake loose, and you need as much of your staff there as possible to absorb it. So next time let’s look at the first two weeks after.
Practical China 