chapter  34
7 Pages

Managing small enterprises in China’s decentralized organizations

The platform function and employee incentives
WithJian Han, Jason D. Shaw

Organizational complexity has given rise to design approaches, including the creation of fully or partly self-contained ‘platform’ units as a form of decentralized structure. Introducing these small enterprises (SEs) has become popular in China and the chapter reports research from data gathered across three case examples representing different industries. The chapter looks at the implications for incentive reward structures of business processes introduced to coordinate SEs’ activities, with the intention of making them agile, innovative, responsive to customer demand and cost-conscious. It finds that SEs’ incentive systems feature potentially high returns as well as high risks, especially low pay or even jeopardized job security when SEs fail to perform satisfactorily.