Locality and organizational translation in enterprise employment systems under market transition: a case study of the zidi gong system at X Company

Market-oriented reforms in China have transformed enterprise employment systems, yet localized employment arrangements continue to persist and adapt within market-oriented firms. This study examines how enterprise employment systems change through processes of organizational translation, focusing on how locality is mediated within organizational practices. Drawing on a case study of the zidi gong (employee descendants) system at X Company, a reformed state-owned enterprise, we challenges interpretations that treat kinship-based employment as a residual legacy of the socialist planned economy. Based on multiple rounds of fieldwork, in-depth interviews, and archival materials, the analysis shows that the zidi gong system is rooted in local conditions, including land requisition, labor supply, skill transmission, and cultural traditions. However, these localized elements do not directly determine employment practices. Instead, X Company actively translates locality into legitimate and functional employment arrangements by selectively integrating local resources, redefining their organizational functions, and institutionalizing them within the firm’s employment system. Through this process, kinship-based employment is transformed from a contextual condition into a stabilized organizational practice. Although the zidi gong system originated in earlier local arrangements rather than as a direct response to market transition, market-oriented reform altered the institutional conditions under which it had to be justified, formalized, and recalibrated. As market pressures intensified, X Company further reconfigured the system through procedural reforms and narrative reframing, embedding it within a functionally segmented multi-track employment structure. By foregrounding organizational translation as a key mechanism linking locality and employment systems, this study contributes to broader debates on employment systems and hybrid organizations in transitional economies.