The Challenges of Managing Taiwan’s Millennials

Younger Taiwanese have a very different approach to work than previous generations. Companies are looking for the best ways to adapt.

Since the start of Taiwan’s manufacturing age half a century ago, the same ethos has permeated most companies’ corporate culture. Decision-making is concentrated at the top, absolute loyalty is expected from employees, and overtime work is obligatory.

The culture hasn’t changed much because company founders rarely relinquish the reins unless they encounter health issues. Taiwan thus has many CEOs born in the mid-20th century whose ideas about business and management continue to define how firms are run. When founders do appoint successors, they often choose family members because they trust them more than outsiders.

This corporate culture is now vulnerable to disruption from younger Taiwanese who approach work differently. Human-resources experts say that Taiwanese in their 20s or early 30s – the younger segment of the millennial generation born between 1981 and 1996 – place high importance on maintaining a proper work-life balance, are more open to changing jobs, and are less deferential to authority. When firms fail to meet their expectations, the millennials often jump ship, making it more difficult for firms to cultivate younger talent.

“Taiwanese millennials are less patient than older generations, and they tend not to plan for the long term,” says Cindy Chen, regional head of the Adecco Personnel Co. for Taiwan and South Korea.

Having grown up with the internet, millennials are used to a fast-moving world where food, transportation, shopping, and social interaction are available on-demand, she observes. It’s the world of the 24-hour news cycle, where young tech billionaires are seemingly minted overnight.

“They see young entrepreneurs in the news, people their own age who have become heads of important tech companies, and they want to emulate their success,” says William Zyzo, managing director of consultancy Z&A Knowledge Solutions. “But they aren’t always aware of how difficult entrepreneurship can be, and how hard the successful company founders have worked to reach the level they’re at.”

William C. Vocke, Jr., executive director of the Foundation for Scholarly Exchange (Fulbright Taiwan), sees social media as having caused young people in many societies – including Taiwan and the United States – to feel impatient when results aren’t achieved rapidly. “They want to change the world now, but the world isn’t susceptible to being changed as fast as they would like,” he says.

Vocke advises managers to be sensitive to millennials’ desire for fairness and transparency. “Rather than saying ‘that’s the rule’ or ‘that’s policy,’” explain the reasons behind the policy, he suggests. “People believe they are being treated fairly when they know why they are being treated that way.”

Alan McIvor, a recruiter at Bo Le Associates in Taipei, says that he often has difficulty filling positions with younger Taiwanese. In his experience, many of these prospective employees are unreliable, sometimes accepting an offer from a company and then changing their mind at the last minute. In addition, they often quit at the first signs of discomfort.

“They won’t do the long hours for low pay that’s typical in Taiwanese companies,” he says. “They have a low threshold for pain.”

To be sure, Taiwan’s low salaries, which adjusted for inflation are even below the level of the late 1990s, are a perennial problem that affects the entire working population – not just millennials. But millennials are less willing than previous generations to accept the status quo.

“They think primarily about their happiness in the short term,” McIvor says. “They are less likely than older generations to stick with a job and hold out for a promotion and salary raise.”

Adds Z&A’s Zyzo: “They have less fear of what not having a job would mean, so they’re not afraid to quit and try something new.”

Adapt or bow out

The internet revolution is hardly the only influence that has shaped the millennials’ mind-set. Indeed, older generations of Taiwanese often describe the millennial generation as “spoiled” or “coddled” by their parents. Compared to the environment that baby boomers grew up in, today’s young people lead a more comfortable lifestyle. Not only are their basic needs met, but they have more disposable income and leisure time than previous generations.

They have fewer siblings, too, which means they get more attention from their parents. The fertility rate in Taiwan has steadily fallen from about seven children per woman in 1950 to 1.06 today.

Among men, the reduction in the length and intensity of compulsory military service may have also affected their attitudes towards work. When Taiwan first implemented conscription for males 18 and older in 1951, two to three years of service was required. Now young men must complete just four months of training, and the government’s goal is to institute an all-volunteer force.

In McIvor’s experience, manager-level candidates 40 and older, who typically would have done at least one year of compulsory military service, think the discipline they developed in the armed services makes them stronger. He says they show a greater willingness to work their way up the ladder in an organization.

Zyzo regards Taiwan’s education system as adversely affecting the career opportunities of millennials. While acknowledging its strengths in training students in mathematics and the hard sciences, he says that schools are not cultivating the critical-thinking skills that employers increasingly need. The education system could benefit from adopting a more international outlook, such as through partnerships with foreign universities, he says.

Companies are also advised to consider introducing some changes to accommodate millennials’ workstyle preferences. These involve everything from digitalizing the workflow to be in sync with how millennials live to focusing more on project-based assignments, offering faster-track promotions, and recalibrating career development paths.

At the same time, managers are encouraged to engage more with younger staff. “Millennials want to be recognized and they also want to be mentored,” says Adecco’s Chen.

Some traditional companies will manage to adapt, while others will be squeezed out of the market. Unfortunately for epicureans, traditional Chinese restaurants are likely to be one of the endangered market segments. The tough nature of restaurant work doesn’t appeal to many members of the younger generation in restaurant-owning families, while the bosses (typically the founders or second generation) are loath to invite outsiders into the business as partners, Chen says.

Taiwanese corporates will need time to integrate millennials smoothly into their operations, says Bo Le’s McIvor. He notes that in many local companies, the senior executives still usually dominate the decision-making process even if the mid-level people are fully capable. Middle managers aren’t sufficiently trained to take on eventual leadership roles, making it difficult for senior managers to step down, as their shoes are too big for anyone else to fill.

“It’s a big challenge for local companies,” Chen said, “but they will have to change their culture.”