In the same league as Amazon Inc., Microsoft, and Alphabet Inc., the Chinese multinational investment holding Tencent is considered one of the world’s biggest companies in the gaming industry. Founded in 1998, the company is based in Shenzhen, China. What began as a mobile-messaging service provider quickly turned into a platform for social networking, gaming, paying bills, and ecommerce. First released in 2011, Tencent’s ubiquitous WeChat has more than 1.1 billion users in the most recent quarter of 2019. Tencent’s CEO Ma Huateng understands that staffing is key to increase the company’s growth trajectory and that every employee must have a stake in the company’s success.

Huateng, often referred to as Pony Ma, strives to create an open and comfortable work environment, an ease of communication with management, and provide recognition of individual accomplishments. At Tencent’s monthly meetings, staff members ranging from senior management to trainee managers discuss their latest projects. Decision making at the company is not as formal as in other big conglomerates.

Extolled by Goldman Sachs and General Electric, Huateng regards internal competition between coworkers a necessary driver of innovation. He wants all the different teams to function parallel to one another, as no one team can be held responsible for creating the best product. While moral satisfaction is important, Tencent holds the importance of employee productivity as a performance measure in high esteem and links performance to remuneration. Employees are awarded cash prizes for valuable results, such as redesigning an interface in light of new and significant innovations in the industry. One manager remarked that an employee is gratified when they win something, no matter how small or big the reward. Cash rewards have become part of the ingrained Tencent culture. Along with it, an annual bonus, often paid prior to the Lunar New Year holiday, can be higher than an employee’s yearly salary at Tencent.

By rewarding employees with shares in the company, profit or equity sharing is one of the most celebrated incentives used by Tencent to reward its high achievers. In 2016, Tencent grabbed the headlines after it gave HK$2.6 billion worth of shares to 7,068 employees as part of the company’s anniversary celebrations.98

 DISCUSSION QUESTIONS 

1. Do you think the work culture at Tencent is effective? Would it work in other organizations? Why?

2. How would an understanding of organizational behavior help managers?

What do you think will be Tencent’s biggest challenge in the future?

3. Using what you’ve learned from the various organizational behavior theories, what does Tencent’s situation tell you about employee behavior?

4. Looking at the incentives system offered by Tencent, what does that tell you about the importance of understanding individual behavior?