Airline Union Calls For Minimum Wage Disclosure

Bernama reports that members of the Malaysian Airline System Employees Union (MASEU) have called on all government linked companies (GLCs) to disclose their minimum wage rate. Read more

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Proton Malaysia Assembly Line Workers Among Lowest Paid

Proton Malaysia’s assembly-line workers are among the lowest paid in the nation, according to the Malaysian Trades Union Congress (MTUC). Read more

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Retirees Get One-Off Sum From Bank

Maybank has become the first bank in Singapore to pledge a one-off payment to employees who cannot be rehired beyond retirement age. The bank also recently undertook to end the practice of slashing employees’ salaries when they turn 60, although this is allowed under the law. Read more

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Human Capital: The Challenges Facing Asia

Courtesy of INSEAD Knowledge

by Kevin Tan, Singapore

While the economic downturn is a key focus for many C-level executives, the need to attract and retain talent remains an important issue. This is all the more so in Asia where developing countries such as China and India are helping to drive the world’s economic recovery.

Narayan Pant

Narayan Pant, Affiliate Professor of Strategy and former Dean of Executive Education at INSEAD, believes that companies are already thinking about their human capital needs for when economies pick up. “So the question for many was, if you have excess people now, could you find a way to hold on to them so that you would have them available when the economy starts looking back up? I think this was an important focus for many organisations.”

At this year’s Singapore Human Capital Summit where Pant was a facilitator, participants were told that companies have to engage their employees by recognising their different needs and aspirations, and address these accordingly. “The way to engage people is to figure out what creates value for them – recognition, opportunities for personal development, opportunities for travel, work-life balance or other dimensions, in addition to compensation,” says Pant. “Understanding what dimensions of value are relevant for different groups of employees and tailoring solutions that work for different groups, is one way to keep employees engaged.”

However companies in Asia are not doing enough to recognise the diversity in employee needs and segment employees appropriately, says Pant. Encouragingly, some large companies are clearly experimenting with this, he says.

Harish Manwani

Pant also notes that companies are trying to attract talent by using corporate social responsibility (CSR) initiatives. Notably, Harish Manwani, Unilever’s President for Asia, Africa, Central and Eastern Europe, championed the idea of ‘doing well by doing good’ at the conference. Pant believes, however, that to be sustainable, CSR initiatives need to make a business case, otherwise they will be yet another fad of good times.

“So if it makes people feel good to be part of an organisation that seems to care, then offering employees CSR opportunities is one way to improve commitment and productivity. This could, in turn, have beneficial business effects,” explains Pant.

“Saying that CSR results in better employee engagement numbers makes less of a dollars and cents case, but it can make sense. Higher engagement results in lower turnover and better on the job performance, which builds a potential business case for CSR.”

Sunny Verghese

Also at the conference, Sunny Verghese, Chief Executive of commodities trading firm Olam International, said that in his view CSR initiatives are only tenable if they help sustain profitable growth. As a concerned shareholder himself, Verghese is interested in engaging in CSR initiatives that have two features – they enhance business growth and they fall in an area the company knows something about. And so Verghese says Olam does not get involved in HIV/AIDS programmes, even though HIV and AIDS affect many farmers in areas where they do business. Instead Verghese seeks to use Olam’s expertise in farming to help farmers achieve better crop returns, which in turn benefits Olam, says Pant.

At the conference, Unilever’s Manwani also argued that companies should think locally and act globally, which Pant agrees with. Manwani’s point, says Pant, is that any individual is a local customer, meaning that the act of purchasing always happens in a local context. However, companies can enjoy a competitive advantage at the local point of sale by leveraging their global reach and strength.

“Thinking about the challenge in this way could empower employees to engage with local customers in ways that create value for them while leveraging the advantage of a global organisation,” argues Pant. “Manwani perceives this to be much more sustainable than the other way, which is trying to offer global solutions to people who are local customers.”

Asian Human Capital Award 2009 Accenture India triumphed in a ‘close fight’ for the inaugural Asian Human Capital Award, fending off 43 competing entries from seven countries across the region. Speaking to INSEAD Knowledge, Narayan Pant, who was a member of the judging panel, said: “The thing about Accenture India that caught my attention was how their mentor-mentee relationship worked. I thought it was quite powerful, and they had teeth to it.” “Both mentors and mentees got evaluated on how they did in this relationship. But the crucial aspect to that was that relationship was designed to enable the mentee, or the person that was being mentored, to achieve his or her developmental goals.” “Those developmental goals, those personal aspirations were at the centre of the mentoring relationship which to me was very powerful, so it wasn’t about how we get you to be a better cog in the organisational system, it was much more about what do you want and how can we help you get it?”

Pant adds that, semantics aside, companies often fail to empower their client-servicing employees with the tools to deliver value to customers. Sales forces of multinational corporations often complain that they have to follow global and possibly misaligned marketing approaches for their local clients. A quick win would be to work more seriously on adapting sales tools and approaches to the local context.

“If you give a person the ability to adapt solutions to local needs, you make them feel good, you make them feel powerful, you excite and energise them.”

Asked about an assertion at the conference by Hsieh Fu Hua, the Chief Executive of the Singapore Exchange, that leadership has to be shared in companies, Pant says that companies in Asia are adopting this idea. But he notes that Asians believe the myth that the boss makes all the decisions and that all decisions are made before meetings, which are used only to rubber-stamp decisions.

However the myth is just that, says Pant, as Asia often practises ‘leadership by walking the corridors’. “The boss has actually come to a decision by walking the corridors a month before the meeting, making sure that he or she understands what everybody’s thinking.”

“So by the time he comes to the meeting, he’s already tried and tested a couple of trial balloons behind the scenes with several key stakeholder groups.”

“I think there is a great weight given to community and harmony in Asia. This co-exists almost paradoxically with an external impression of great power distance and strong hierarchical organisations. The way these are reconciled are quite unique and can be seen in leadership practices that are less visible to the casual observer.”

Hsieh Fu Hua

At the conference, Hsieh was asked how companies should manage the paradox of driving change while maintaining a sense of stability for employees. Hsieh replied that companies should foster evolutionary change, anchored to the values and culture that are shared by employees.

On this issue, Pant agrees that it is important for companies to manage change while fostering a sense of stability among employees. But he notes that organisations can make incremental changes for quite a while, until the need for dramatic changes (such as changing leadership teams and organisational structure) becomes over-powering. This has been described in the organisational literature as long periods of evolutionary change, punctuated by bursts of revolutionary change.

Pant adds that the current generation of managers is possibly more receptive to the idea of continuous change than previous generations who tracked their progress by the office spaces they occupied in their careers. Pant says he doesn’t think employees expect organisations to remain the same because they don’t expect environments will remain the same.

On the key lessons gleaned from the conference, Pant says the idea that companies shouldn’t treat employees as if they are all the same, is becoming popular as there is a growing emphasis on the need to segment employees carefully and create varied engagement strategies for diverse segments.

Companies also learned that leveraging global workforces meant empowering them to think local, while gaining access to the benefits of being part of a global organisation, says Pant. Gaining tangible benefits from this will require companies to get the logistics right that enable these employees around the world to work with each other.

But the biggest lesson, says Pant, is that no guru anywhere has the answers to the specific issues and challenges that Asia will face in the future. It is up to those who work in Asia to experiment, innovate and find the best solutions that work for them.

INSEAD was an academic partner of the Singapore Human Capital Summit, which was held on September 29-30, 2009.

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Investment in Workforce a Priority for Nestle

Investing in human capital development is important for company’s future. So says Nestle S.A. chief executive officer, Paul Bulcke.  As such, Nestle (M) Bhd has allocated about RM7 million for training annually. Bulcke was reported to have said:

Nestle employs more than 280,000 people around the world and we consider human capital development an important investment for the future of Nestle…  In 2008, Nestle Malaysia’s training covered some 19,000 man days with over 9,000 employees trained.

Recognising the importance of developing and nurturing a pool of talented and skilled workers, Bulcke was reported to have said that Nestle had rolled out training programmes focusing on leadership and functional competencies, personal effectiveness and promotion of e-learning throughout the organisation. Read more

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Work-From-Home Programme for TM Group

Telekom Malaysia Bhd (TM) recently launched a pilot programme that gives employees the opportunity to work from home. The programme not only takes into consideration the benefits to employees needing to work from home, but also is friendlier to the environment. TM group CEO, Datuk Zamzamzairani Mohd Isa, was reported to have said the move was in line with its efforts to contribute to a “greener” environment in Malaysia.

Zamzamzairani was reported to have said, “We have selected a few people who can do their work from their homes. This will cut down on travelling and thus reduce the carbon footprint as well as time and money.” He explained that the group began the programme with 10 employees and planned to increase the number eventually.

Other corporate social responsibility (CSR) programmes TM plans include nurturing the nation’s younger generation through its resources and development programmes.   Zamzamzairani also said that the group’s Yayasan TM has disbursed RM20 million for education in 2008.

He was reported to have said, “Since its inception, the foundation has contributed more than RM360 million to 10,077 students at secondary and tertiary levels, to continue their studies locally and overseas.”

TM has also adopted two schools, the SK Bukit Indera Muda and SK Seri Penanti in Bukit Mertajam, Penang, under its Pintar programme. Under the three-year programme, TM group organises various programmes and activities to assist the students to obtain better academic results, especially with the aid of information and communications technology.

According to Zamzamzairani, “Urban schools can raise their own funds and emphasis is usually placed on the rural schools. “The two schools are in the suburban areas, therefore they are sometimes forgotten. Gone are the days when a company just presented a cheque to help the needy and be done with it. Now, corporate responsibility goes beyond that.

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Business Sustainability

By Irene Millar

Sustainability is a new buzz word, but what does it mean and how does it relate to your organisation?

Deriving from the Latin word sustinere meaning to “hold up, support, endure”, the Oxford English Dictionary defines sustain as “keep (something) going over time or continuously”, and sustainable as “avoiding depletion of natural resources.”

So, attaining Business Sustainability requires your organisation to operate in an effective and efficient manner in all aspects of your operation.  All organisations depend on the use of natural resources such as oil and trees in the production and distribution of their products and services.  A truly sustainable organisation consciously works on achieving profits by reducing costs through the application of two key targets: Read more

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