A specific segment of the Hungarian labour market has changed significantly in recent years: the number of workers coming from abroad, mainly in managerial positions, has increased significantly. Moore Hungary's experience shows that white-collar labour imports are not a recent phenomenon, but have gained momentum, especially with the influx of Asian investment, including Chinese and Korean investment.
White-collar employment is not a new phenomenon in the Hungarian temporary employment market, as there is often a reason behind it that is independent of the era. For example, if a chief accountant who is leaving on maternity leave for the foreseeable future needs to be replaced for this transitional period, temporary agency work can be a more effective solution than temporary employment for a year and a half.
A similar interim situation is when a family business is looking for a CEO to take over until the successor from the generation after the founder has the qualifications or experience needed to take over the suddenly vacant top decision-making position.
Expats: a familiar exercise at a new pace
For decades, it has been common practice for multinational companies setting up in Hungary to bring in key players from the home country, in addition to the corporate culture. Moreover, the proliferation of business service centres has led to even greater interoperability, as it is becoming increasingly common for a Hungarian SSC to be headed by a senior executive from Asia, for example, from a South American base.
The fact that this practice has been on the rise in recent years is also closely linked to the affinity of Asian countries to invest here. According to Péter Hajnal, managing partner of Moore Hungary, Asian investors are much more likely to send their own proven home-grown managers as soon as they enter the Hungarian market.
„The practice of sending their own people to Hungary is particularly strong in the Chinese and Korean giants. Not just to transfer knowledge and to establish the corporate culture there, but also to control the investment. As the willingness of investors from the Far East has increased strongly in recent years, this has also been reflected in the number of foreign managers coming to Hungary,” he adds.
Knowledge and culture transfer
Asian corporate culture may seem unusual to European eyes because of its formalism and hierarchy, and loyalty is also much more strongly present in these corporate worlds. Unquestionable loyalty is also an important factor, according to Peter Hajnal, in the confidence with which a Chinese or Korean company can send people to remote locations: as these managers tend to be closely tied to the parent company, they are not likely to „defect” to other companies, even within their own culture.
Therefore, business decision-makers who come to Hungary, for example, are not only involved in setting up and launching operations here, but also remain active players in the business community in the longer term. „This reinforces even more strongly that the manager is an „extended arm” of the parent company in the foreign country, not only professionally but also culturally,” says Péter Hajnal.
On the one hand, this facilitates the transfer of knowledge, the main aim of which is to embed the parent company's processes and corporate culture. On the other hand, it gives the Asian investor tighter and more predictable control over the investment.
Bureaucratic deadlock
Of course, another obstacle to white-collar foreigners migrating to Hungary is that entry and work permits are usually valid for the company in question, which makes these professionals even more tied to that company.
Moore Hungary's experience shows that it is common, especially in Asian companies, for management to remain exclusively in „domestic” hands in the longer term. More generally, irrespective of the sector of the economy in which the investment is made, senior management or key professional managers often come from abroad.
Not specific to Hungary: a regional phenomenon
It is important to see that the practice of managerial delegation, which is typical of Asian firms, can also be found in neighbouring countries. At least this is what Péter Hajnal sees from the lessons of Moore Hungary's international network. As he says, it is not the corporate culture, trust system and strategy of the host country, but the sending country that determines how frequent and for how long the „import of executives” is.
The model of managing local operations with managers delegated from home is generally accepted by Hungarian workers, although foreign managers bring a different corporate culture and management style. According to the expert, the basis for cooperation is that managers are familiar with the company's global operations, while local colleagues ensure the smooth running of Hungarian operations.
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Of course, this does not mean that there are not serious, difficult challenges at the beginning, for example in decision-making, communication or working hours. Moore Hungary's experience shows, however, that these can be addressed through a gradual alignment between parent company and subsidiary.
To make sure everything goes smoothly, it's also a good idea to check with a consultant with extensive experience in white-collar recruitment. In an extremely fast-changing environment, Moore Hungary draws on the strength of a global network to help its clients find the best solutions, drawing on its own local expertise and client-centric approach.
Starting from an office in London more than 110 years ago, Moore Global is now one of the world's leading consultancy networks. Its services will be directly available in the Hungarian market from March 2021. With its team of experts, Moore Hungary offers a full range of consultancy services, including recruitment services with a specific focus on senior management positions.
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