Even with the globalization of Taiwan's economy,
a frequently overlooked element of the process
is the role played by foreign white-collar
professionals. Free China Review examines
the hows and whys of recruiting outside talent
for Taiwan businesses.
As Taiwan becomes integrated into the mainstream of the global economy, an increasing number of foreign white-collar professionals are making Taiwan their home and, in the process, are contributing to the island's success by bringing international standards of expertise. "Rick" (not his real name) is one good example. He originally came to Taiwan four years ago to work as a technical specialist for the Taiwan branch of a major US computer company. "The American computer company is the parent of my employer. Our company makes computer peripherals for the parent company on an OEM basis. I was sent over here, not only because I was a person who had the requisite technical knowledge of the field, but also because I was the only one willing to come." Since Rick's arrival, he has married, settled into the Taiwan scene, and is now raising a family.
Prior to the withdrawal of US forces from Taiwan in 1979, local people perceived foreigners generally to be soldiers from a faraway country. That picture changed with the end of the Cold War and the blossoming of international trade and cultural exchange. Many foreign professionals have moved to Taiwan to take positions in business, technical, and academic circles.
To meet the challenges ahead and to raise the ROC's national competitiveness in the global economy, the Legislature revised the Employment Services Act in May 1997, with the guiding principles of restricting the employment of blue-collar workers while welcoming more white-collar professionals to the island. Whereas the restrictions set for the import of foreign labor aims to protect job opportunities for local workers, the encouragement of foreign specialists is designed to keep Taiwan current with world business trends.
As defined by the Act, foreign white-collar workers include six groups of professionals: high-tech specialists, business managers, college and university professors, foreign language teachers at buhsibans (supplemental "cram schools"), coaches and athletes, and professionals in the religious, arts and entertainment sectors. Of these six categories, many commercial enterprises and government planners see foreign high-tech specialists and foreign business managers as particularly important to the future growth and development of Taiwan's economy.
Formerly, it was rare for an organization to bring in foreign professionals, as Taiwan saw no such need; but the situation changed after members of the international community began to interact with one another more frequently. "In the past, there was a limitation on how many foreign workers could come to Taiwan annually. But at present, no numerical quota is set for the recruitment of white-collar foreign workers," says Chiang Pin-kung (江丙坤), chair of the Council for Economic Planning and Development (CEPD), which formulates the ROC's economic policy. Any numerical restrictions that may exist are probably only practical, as determined by the company or organization, rather than by government regulations.
"Since the ROC government is carrying out projects of trade liberalization and internationalization, as well as establishing Taiwan as a regional operations center, we have to adjust the overall economic structure and allow the free movement of commodities, services, personnel, capital and information," Chiang adds. One way to achieve these goals is to bring in more people with international capabilities. Two simple requirements are listed for foreigners who wish to come to Taiwan for white-collar employment: they must be college graduates, and they must have at least two years of work experience.
"I think the [ROC] government has done a good job trying to make it easier for foreigners to come here to work. It's much easier now than it was eleven years ago when I first came here. At that time, we had to leave the country every six months just to fly to Hong Kong or another country to get a stamp and then come back," says Bernard S. Wathen, Taiwan director of Ward Howell International, a company doing senior executive searches.
Other changes include the simplification of procedures for the application of work permits, the extension of duration for foreigners to stay on the island, and the loosening of qualifications for foreign white-collar workers. Residency certificates are issued by the National Police Administration to foreign professionals with work permits. Based upon the request of the local employer, the period can be one year, two years, or three years. Residency certificates are renewed by individual application.
However, not all foreign professionals enjoy these new conveniences. Recently-enacted laws have actually made it more complicated for Taiwan's large contingent of foreign university professors to remain here. Two sets of regulations govern the length of time a professor may stay in Taiwan: the Employment Services Act, formulated by the Council of Labor Affairs (CLA), and the Statute for the Recruitment of Foreign Instructors, dictated by the Ministry of Education (MOE). According to Yang Yu-hui (楊玉惠), with the MOE's Department of Higher Education, the Statute for the Recruitment of Foreign Instructors requires that schools offer contracts to their new foreign faculty on an annual basis only. The Employment Services Act permits foreign professors to remain in Taiwan for more than one year, but also requires that contract-renewal be done on an annual basis. According to Yang Yu-hui, the MOE statute does allow universities to issue multiple-year contracts to foreign faculty who have been employed by the university for five years or more, at the discretion of the school administration; however, preliminary indications suggest that multiple-year contracts are indeed quite rare. Prior to February 1998, foreign university faculty were eligible for contracts issued beyond a single year at a time, even before they had put in five years.
Officially, it is up to each school's administration to determine the total length of time a foreign professor may stay in Taiwan. Unofficially, however, faculty assume that their teaching contracts will be renewed annually and that their jobs are secure, even though Taiwan does not at this time have a tenure system as does the United States. Regardless of their job security, though, the limiting of contract offers to a single year means that the vast majority of Taiwan's foreign professors must now go through the irksome task of applying for re-entry permits and renewing their alien residency certificates every single year--at least twice as often as they did before, when they were working under multiple-year contracts.
In the process of liberalization and globalization, foreign professionals are like instructors who assist the inexperienced to adapt to the new world situation more rapidly. "Taiwan may need foreigners to help learn how to function in an international environment. After all, Taiwan was very closed off from the rest of the world for forty years," says senior consultant Robin J. Winkler of Qi Lin International Law Offices, who is also the chair of the Intellectual Property and Licensing Committee of the American Chamber of Commerce in Taipei. "Because the government took care of almost everything, the private sector did not have the chance to handle things by themselves. But it is learning very fast," he adds.
"Although Taiwan has done a very impressive job economically, politically and legally in improving systems to approach international standards, it still finds itself not very well prepared on many international fronts," Winkler remarks. Therefore, "to make Taiwan a regional operations center, Taiwan needs to have people with regional capabilities and international capabilities." He goes on to say, "I think that allowing more free interchange of people in Taiwan is going to help Taiwan not only get used to dealing with foreigners, but also adapt more quickly to the challenges ahead and become more active in world affairs."
Another benefit derived from bringing in foreign professionals is expertise. "The expertise brought in from outside basically allows Taiwan to gain knowledge and experience that does not exist here," says Wathen, who came to Taiwan on one-way ticket eleven years ago. "The essence of the law governing the recruitment of white-collar workers is that they must prove they have some capability that is not available locally," he points out.
This point is echoed by Agge Chang (張慧珍), personnel manager of Acer Semiconductor Manufacturing, which had an eight -year joint venture with US-based Texas Instruments until June of this year. "The semiconductor industry was new to Taiwan ten years ago. There were few local experts in this field, so TI-Acer had to bring in many foreign technicians for support." This is the reason that most local white-collar workers do not feel their jobs have been taken by an elite group from outside.
CEPD chair Chiang agrees. "Technology advances so rapidly that Taiwan simply cannot keep pace with it." One category of experts Taiwan lacks is in the field of Research and Development. "Many high-tech companies in the Hsinchu Science-based Industrial Park complain that they cannot find suitable personnel," Chiang cites as an example.
Chang backs Chiang's claim by adding two other reasons for the cooperation with Texas Instruments. "We certainly can do the research and development by ourselves, but there are risks in time and results." It usually takes a long time to study and develop a new high-tech item, without knowing in advance whether the process will lead to success. Even when it is a success, the question remains as to whether the research is in line with world technology trends.
Therefore, "finding the right people and placing them in the right jobs has become more and more important," Wathen says. In the old days, when labor costs were low, Taiwan was able to compete by using a "family business" system, which is flexible in the sense that every family member can take any kind of job to keep the company going. "However," Wathen continues, "to compete in today's world market, corporations have to be efficient and effective. They must have the right management, and there has to be a learning environment."
What can Taiwan's professionals learn from their foreign counterparts? The first thing Chiang points out is experience. "There is a shortage of local experts in such financial derivatives as futures." To fill the gaps, he lists three options: first, inviting foreign experts to train local professionals on the job; second, sending local workers abroad to gain first-hand experience; and third, setting up relevant departments at schools to provide instruction in specific areas of knowledge and know-how. "All these should be carried out at the same time," Chiang stresses.
Over the last several years, Acer Semiconductor has been taking three similar measures to train its engineers and technicians. "We send experienced engineers to attend overseas workshops, we invite foreign experts to Taiwan to share their experiences, and we work together with foreign counterparts to learn on the job," Chang says.
At the very beginning, Stan Shih (施振榮), head of computer giant Acer Group, thought that Taiwan should make its electronics industry stronger. Therefore, while other companies worked hard to develop their own software, Acer started to cooperate with Texas Instruments in order to ground the high-tech industry in Taiwan. "Although Taiwan has its own high-tech professionals, the United States is still more advanced technologically. We need to learn from the best," Chang explains.
Second, local professionals can learn the Western way of communication. "Foreigners are more direct in their thinking and speaking. But we Chinese think and talk in a circular way," Chang says. "While they go directly to the point, we will greet one another before getting on with the business." In addition, "foreign specialists tend to be more objective while discussing things," the personnel manager adds. "This may be because they come here as support. Since they do not have the chance to be promoted here, they pay little attention to interpersonal relations. I think they have a positive impact in this way, because this attitude urges local professionals to judge the case as it stands."
Chiang points to a similarly positive influence. "Comparatively speaking, local people are more flexible in doing things. Foreigners, especially the Germans and the Japanese, are more methodical and follow a prescribed pattern of action. This is a good model for the work attitudes of ROC citizens." Acer Semiconductor's personnel manager agrees: "Foreigners prefer to follow procedures, while the Chinese will sometimes take alternative ways."
Local white-collar workers should also learn to keep current in their professions. "I think foreigners have a higher standard of professional training," Winkler opines. "My observation is that professionals in Taiwan are very talented, but once they gain fame or fortune, they tend to forget their professions. In other words, they spend more time socializing and doing promotion but not much time in keeping up with the latest developments in their fields. They concentrate more on dealing with officials and clients."
Difference in perspective is another concern. "As we have placed some local and foreign executives into the mainland market, they can bring in a different perspective after coming back, because their jobs were more regionally focused," Wathen says. Wathen attributes the difference between local white-collar workers and foreign professionals to the different orientations of the educational systems. "Taiwanese senior management is very good at what I call 'left-brain thinking,' because their science and mathematics are excellent. They have had superior training in these disciplines, and they are good at such functions as accounting and implementation roles. But when you get to the situation with right-brain-oriented activities," he argues, "local people fall short. In the Western style of education, 'Why?' is always asked at school. Exquisite planning and creative thinking are more developed in the West, but the implementation side and accounting side are weaker there."
"I think a hybrid, a mixture of the two, is the best system. Those who figure out how to bridge this gap will be the ones who do best. They are people who come in and are able to be culturally sensitive and to understand that it is not right or wrong you are looking at. There are cultural differences all over the place. If you can meet somewhere in the middle of that, you create a source of strength, not a source of weakness," Wathen explains.
"What Taiwan lacks at present is training in planning and financial analysis," Wathen says. The West has these two skills. "The market before was very much a push market, very sales-oriented. Now it becomes a pull market, with brand marketing finally being important. It requires us to look ahead instead of reacting at the moment or later. Hindsight won't work. You must be able to see what is down the road, and costs have to be controlled better."
But learning is never a one-sided story. "We can always learn from each other. The creative side is something that we should continue to improve. By the same token, what can foreign professionals learn from Taiwan? I think we can learn to be more harmonious in the working environment and not always so black-and-white. Sometimes gray is also okay."
One beneficial effect of recruiting foreign professionals and sending local specialists abroad is that it upgrades the ROC's technology level by bringing in the most advanced ideas and expertise. But there is another less visible contribution: both foreigners and foreign-trained local experts may sometimes change jobs. "Although it may be a loss to the company that recruited and trained the people in the first place, the move will still have some positive impact on the entire industry," Chang says. The interchange of human resources in the local high-tech industry will eventually help raise the overall technology level, since each company has strong points that can be shared with other competing firms, she explains.
Many Taiwan-based multinational companies, such as Acer, are following the world trend of setting up overseas branches. "While technological advancement is the purpose, internationalization is a benefit that the process brings," Chang says. "Before, foreigners brought in expertise. Now, foreigners sell expertise to other countries," Wathen observes. "This is a real change."
At present, foreign blue-collar workers are under the jurisdiction of the CLA, but there is no single government agency responsible for the approval of foreign professionals. Instead, they must apply to the government agency relevant to their business lines. For instance, foreign attorneys who come to work in Taiwan are evaluated by the Ministry of Justice; foreign accountants, the Ministry of Finance; professors, the MOE; and cooks, the Ministry of Transportation and Communications. Because the Ministry of Economic Affairs (MOEA) is in charge of foreign personnel in the service, business and manufacturing industries, when there is uncertainty about which agency an application should go to, it is usually left to the MOEA to make the decision.
To improve the administrative efficiency and place both blue-collar and white-collar workers under the jurisdiction of a single government agency, the CLA has decided to set up an ad hoc window to reduce the paperwork of bringing in foreigners. Currently, a company needs to visit at least three agencies to get the necessary approval to hire a foreign worker in Taiwan. First, the company has to file the application with the relevant government agency. Second, the foreign professional must get an ROC visa from the Ministry of Foreign Affairs. And third, after the professional comes to Taiwan, the company needs to inform the police administration.
"Centralizing the work permit system will be very good. I hope that the central agency will publish all details in English on its website. That will be very helpful and very good for Taiwan's internationalization," Winkler says. He also urges the government to continue to publish laws and regulations in English, and to hold public hearings before establishing or revising any relevant acts.
Will efficiency be improved after Taiwan becomes a member of the World Trade Organization (WTO)? "The WTO will not make any change regarding liberalization of requirements concerning work permits or immigration. The only thing that is going to change is that Taiwan will see a need to open up," Winkler says. "When Taiwan becomes a WTO member, it's going to have a higher degree of interaction with foreign countries. The number of foreign professionals coming here is going to increase. As a result, the quality of exchange between Taiwan's professionals and their foreign counterparts will also increase."
Wathen holds a slightly different opinion. "It's not an event, it's a process. And the process does not stop with the WTO, it's ongoing. WTO is only a label. If WTO-entry marks a point in time, after that it means we accept the concept that we want to help create a fair playing field for all players."
Chiang agrees, by saying that the opening of service industries after joining the WTO will certainly bring more frequent exchanges of human resources. "Because we believe in the market mechanism, each company can make its own decisions about personnel recruitment." Will such a movement have any impact on the local job market? "Generally speaking, most companies, both local and multinational, will still prefer local people for two reasons: language and salary. When the clients are Chinese, they will need people capable of communicating in the common tongue. Besides, it will be very expensive to hire foreigners."
Even when recruiting staff from outside, Acer Semiconductor still prefers to choose those of Chinese origin. According to Chang, "we would like to invite overseas Chinese scholars back to contribute their knowledge and know-how. If it is impossible to find such people, we will then turn to foreigners." Winkler echoes the same position from a business viewpoint: "The ones who can speak the required language will have an advantage. This is not a matter of favoring anyone, but a matter of communication ability."
Statistics released by the CEPD show that approximately 7,000 foreign professionals apply for ROC work permits annually. "More than eighty percent of the applications are handled by the MOEA, the largest processor of applications. Following far behind the MOEA are the Ministry of Finance, the Ministry of Transportation and Communications, and the Government Information Office."
"Although the ROC's regulations on hiring foreign professionals are up-to-date and convenient," Winkler says, "the one problem we have had is that we would like to hire foreign law school students. However, they do not qualify under the regulations." He suggests that this be changed for two reasons. First, foreign law students are much cheaper than established lawyers. "Good English skills are hard to find here and they are very expensive. So students are a good source of cheap labor." And second, "Students tend to have a good time in Taiwan. If they have good experiences here, they can be good ambassadors for Taiwan. Lawyers in the United States tend to be influential in politics, so I think it could be a good policy for Taiwan," Winkler says.
A shortcoming pointed out by Winkler is the restriction on sending PRC nationals to Taiwan for training. Mainland Chinese are not considered foreigners, but they are not considered ROC nationals, either. Matters concerning mainland Chinese are under the jurisdiction of the Mainland Affairs Council, which processes entry applications on a case-by-case basis. At present, mainland Chinese can come to Taiwan only as visitors.
Winkler notes that "sometimes multinational companies need to move their personnel around, in order to expose them to a regional or international working environment." Wathen agrees. "Speaking from a business standpoint, one of the key problems is the ability to bring in mainland Chinese. The best place to train senior executives in this region is Taiwan. While managers in mainland China are usually PRC nationals, at present no one is allowed to bring them into Taiwan." Chang of Acer Semiconductor concurs: "Sometimes we have to replace really talented people with foreigners, when our first choice would have been the mainland Chinese."
Another problem to be addressed is the urgent, short-term support needed by high-tech companies. "When we have an equipment problem or need to break a technological bottleneck, we must have experts from outside to help. Because they will not be on a business trip, we have to apply for short-term work permits for them," Chang says. The shortest period required to process such an application is one week, if certified study and career certificates are available; however, the deadline needed to fix the problem may be shorter than seven days. Such a delay can cause huge losses in an operation.
Chang, recognizing the necessity of having some type of management of foreigners coming to the island, says that "if Acer Semiconductor is the only company that encounters such a problem, I think it may not be necessary for the government to revise its policy. But if the entire industry shares the same concern, the restriction may need to be reviewed."