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(Second of
five parts)
MANAGING
talent has become more essential to the private sector
than it used to be. Companies are now beginning to dig up
insights into managing talent that should allow them to
deal with brain drain in a more organized way. What is
bold, they say, is to make lemonades when life gives you
lemons.
Owing to
the fact that most of the brightest and best talents are
going overseas, companies are getting much more innovative
about maintaining a niche where competitive people are
still with them.
Semiconductor giant Intel Technology Philippines Inc., for
instance, is constantly producing technical innovators who
contribute to the advancement of local technology and the
local economy. “We are now developing pools of talent in
universities,” underscoring that in the knowledge economy,
technology is the key to global competitiveness, Intel
education manager Joselito Tulao says.
Intel
collaborates with top universities nationwide to expand
university curricula, engage in focused research,
encourage students to pursue advanced technical degrees
and build local innovation capacity through
entrepreneurship so they are able to function in, and
shape, the world ahead.
“I believe
that Filipinos are very talented,” says Tulao. “That’s why
we have instituted programs in higher education as our way
to develop a steady pool of qualified talents.”
Intel also
brings in technology lectures by top engineers in the site
to their partner universities. “This allows students to
get an actual feel of what is done at Intel and heightens
awareness of the company, the industry and even concepts
on research and development,” Tulao says.
Executive
training
HONGKONG
and Shanghai Banking Corp. (HSBC) concedes that there’s
obviously a mismatch between the competency of their human
resources and the demands of the market.
A glance
at the country’s labor statistics will confirm this. Their
unemployment rate is almost 10 percent and their
underemployment rate is much higher than that. It means
that there are millions of Filipinos who are actively
looking for jobs but fail to land one. It means also that
millions of Filipinos hold part-time jobs, barely allowing
them to keep their bodies and souls together.
Therefore,
HSBC is providing opportunities for career development.
“We are strong on learning solutions,” an HSBC executive
says. HSBC has an executive training program, which is
designed to identify high-potential fresh graduates who
can be developed into senior vice presidents in eight to
12 years.
“Four of
our senior vice presidents, who now manage separate
businesses and functions, are products of this program.
They all made it in less than 10 years,” an HSBC source
reveals.
Candidates
are brought to various financial and learning centers of
the world and exposed to the global operations of the bank
so they can create new ideas to develop global networks.
“We currently have four young executives from the
Philippines in this program,” an executive says.
Like HSBC,
auditing firm Punongbayan and Araullo (P&A) has been
sending its auditors to the Asian Institute of Management
to take up Masters in Management and Masters in Business
Administration on scholarship grants. Therefore, P&A blows
its own horn of having the “best talent pool in the entire
industry.”
Two of
P&A’s audit managers have recently finished law studies,
the firm’s human resources and communication director Ma.
Jamea S. Garcia shares.
Rolling
the people
RIGHT
after the Public Company Accounting Reform and Investor
Protection Act or the Sarbanes-Oxley Act had been
finalized in 2002, the United States suddenly found the
need for a number of accountants. “Slowly, it became
easier for our auditors to move abroad,” says Garcia, who
is also a lawyer.
The
Sarbanes-Oxley Act, which is believed to be one of the
most significant changes to the
US
securities law, covers issues such as auditor
independence, corporate governance, internal control
assessment and enhanced financial disclosure.
In 2005
P&A started to feel the consequences of the law’s
enactment when most of their audit managers pack up for
opportunities abroad. And their demand for auditors has
been reaching up to 150 per hiring season, which falls
from December to April—tax season. “That’s a big chunk,”
Garcia says, considering that the firm’s overall size
extends to almost 550 auditors.
With an
almost 30-percent attrition rate, she says P&A manages to
cope with what it has. “We are swift-tracking our
auditors’ training to be promoted faster because they
would be replacing the senior [staff] who, sadly, have
resigned. But that isn’t ideal,” she says.
Outsourcing company AIG Business Processing Services Inc.,
whose attrition rate is similar with P&A, is continuously
recruiting so it would have people going through the
channel of training ready to take a place on the floor
when available.
“The cycle
continues all the time,” says AIG president Chris
Duncan-Webb, “so your quality of people remains high.
We’re not panicking because we have vacancies and we’re
rolling the people through just as the slots arrive. And
it’s the way we’ve managed it here.”
And the
fact that many have been able to move from company to
company and get broader experience on different types of
products in different organizations is “how excellence is
sustained,” says Duncan-Webb.
In the
aviation industry, Philippine Airlines (PAL), the oldest
carrier in Asia, is struggling to fill in their vacant
gaps with competent people. “In our chart we have
available slots, but without names. We know when they’re
supposed to train, but we don’t know their names yet,”
says Lorenzo N. Lim, PAL’s flight operations senior
assistant vice president.
In 1998
“unrest” settled among its local pilots, and through a
protracted strike, began to ask from the government a
salary increase as well as a better work environment. PAL,
which was government-owned at that time, halted its
operation, assuming that then-President Fidel Ramos would
concur with the pilots’ requests. But he didn’t. Many
pilots were laid off and some Southeast Asian countries
made the Philippines their favorite hunting ground,
offering pilots wages triple than what they earned here.
In the
meantime, Lim says PAL is banking on retired pilots. “It’s
already endorsed worldwide. In most Asean countries they
have already approved it because of the scarcity of
manpower, but there should only be one pilot who’s over 60
years old in the cockpit,” he expounds.
But Lim,
who is a pilot, doesn’t expect this to be a lasting
solution.
Salary
tale
COMPETITIVE wages, although still unmatched to salaries
overseas, have created a drift in the labor market. This,
according to business leaders, encourages workers to seek
employment abroad.
PAL, for
instance, has increased its pilots’ salaries to almost 65
percent. Most of them, upon receiving their pay slips,
were dumbfounded, says Lim.
“What we
did was just treat it as a necessary expense. If you base
it on the Philippine standard, even before the increase,
their salaries were already high,” he says.
It’s a
similar situation when the cost of fuel climbs. As a
transportation company, PAL doesn’t have to haggle with
oil firms. “You just have to pay and survive,” Lim
emphasizes.
Bolstering
employees’ financial packages seems to be working to deter
its people from leaving the company. As per PAL’s record,
of its 400 pilots, the number of those who resigned has
been increasing by around 5 percent to 10 percent every
year from 2003 to 2006. However, after the salary increase
had been implemented early this year, only 7 pilots have
resigned as of July.
In
addition PAL boosted its employee benefits with car and
housing loans as well as educational loans if their
children decide to attend aviation school.
PAL’s
management didn’t have any fuss about the strategy, Lim
reveals. After all, Lucio Tan, a self-made billionaire who
controls the carrier, also has control over the Philippine
National Bank and Allied Banking Corp.
The
management had tried to lobby for tax breaks for pilots.
“Take away that 33 percent [for income tax] and it’s sort
of a relief already,” Lim explains. But after this was
turned down by the government, PAL decided to just give
its pilots a more competitive financial package.
PAL’s case
is different for P&A’s. Salary increases are mandated by
the auditing firm, although this raise, stresses Garcia,
is dependent on the employee’s performance. “The salary,”
she argues, “isn’t that important for them to stay in the
company.”
She adds
that P&A employees have salaries that are competitive in
the industry. “Most [of the people] that we have here have
enough salaries to enable them to be comfortable,” she
boasts.
Like P&A,
Intel is offering compensation and benefits on a par with
the industry’s standards.
“Financial
reward is a major incentive for bringing people in,” says
a source from HSBC, adding that the bank bases its job
pricing on the market and positions itself at the 75th
percentile as the midpoint.
“This pay
positioning enables us to hire most of the best talent we
identify in the market,” the source says.
Merit is
the keystone of HSBC’s reward philosophy. For instance
HSBC provides stocks as reward or options to buy stocks of
the bank at very liberal terms.
Pay is a
poor maintenance and retention tool, says this source,
adding that a few months after a salary review, employees
forget about it.
Chikka
Asia Inc., a provider of enhanced mobile messaging
services to mobile carriers around the world, shares the
same philosophy regarding salaries. Peter Cauton, Chikka’s
director for human resources, says increasing salaries
won’t reverse the brain drain.
Recent
industry surveys have been consistent with this point, he
notes. “One recent survey I remember identified lack of
leadership as the single biggest reason people leave their
company,” he says.
AIG’s
Duncan-Webb adds: “One of the things that we learned from
our staff is that, probably, the most important factor for
them why they work [with us] is because of the people—the
supervisory team and the overall organization.”
Meanwhile,
what this means for Chikka is that companies should not
only treat the symptoms but fix whatever is causing it.
“When we take care of all the facets of organizational
development, retention and attraction follow; we try to
take care of all the needs of our employees, and we try to
make it a fun, creative workplace,” says Cauton.
Beneficial
culture
WHEN it
started seven years ago, Chikka had taken a very focused
approach in attracting topnotch human resources, including
crack programmers, analysts and network architects who
would take part in a very ambitious project—to build the
world’s first mobile instant messenger and to launch it in
the Philippines where text volumes were already high.
The
particular challenge in recruiting for the start-up was
the absence of any product, much less brand equity.
Despite this, the founders were successful in convincing
candidates, many of whom had sterling reputations.
“I believe
that even with the offer of competitive salaries, they
took a ‘leap of faith’ believing in a vision,” says Cauton,
adding that Chikka has grown from a start-up crew of 10
people to 250 today.
Moreover,
Chikka has been promoting a beneficial culture. “I believe
that our culture forms a substantial part of our ability
to retain people. It is reminiscent of the ‘dot-com’
cultures we read about or hear about on TV,” Cauton
relates.
It is an
environment that believes that innovation is bred best in
an atmosphere where people are rewarded for their
creativity, he says. In supporting this, Chikka has
created programs such as Launchpad Initiative, where any
employee can submit potential product ideas. The company
then makes the best of these ideas into real projects. The
idea author is then rewarded with a revenue share of
whatever the product makes.
HSBC, on
the other hand, is propagating a culture of open
communication in the bank. “In short, we make our bank the
best place to work in order to keep our best people,” the
source says.
“We also
have employees’ activities,” adds P&A’s Garcia. “We’re
putting them in an atmosphere where they are well taken
care of, both for professional and personal development.”
At the end
of the day, she says employees consider P&A as their home
and family. “And this has worked. We have a lot of alumni
who worked with us, left, and have decided to come back,”
Garcia says.
Ditto with
Chikka, which has experienced “boomerangs,” a term used
when people who resigned return. “And we’re also proud to
say that people who left us get themselves in prominent
positions in other companies or put up their own
start-ups. We’re glad to have played a prominent part in
their development and growth, and maybe even in inspiring
their entrepreneurial dreams,” adds Cauton.
Meanwhile
the outsourcing industry, through the recent Call Center
Conference and Expo 2007, has assured its labor force that
there would be an increased recruitment from
nontraditional talent pools like high-school graduates,
college dropouts and housewives; financial aids to
students; improved work-study flexibility; promotion of
health and safety; and improved condition for night-shift
works.
AIG’s
Duncan-Webb says work environment itself is important and
people are more comfortable if they see a workplace “that
is clean and that provides enough space for them.”
“You
constantly have to meet the expectations by delivering
whatever your promises are to the staff. And I think you
have to provide those opportunities to them so that they
can seek further opportunities for themselves and maintain
that environment,” the AIG president says.
In the
case of PAL’s pilots, they’re already part of the
management team. Lim says when they go to other countries,
for example, their allowances are on a par with what other
management personnel get. “They’re also given that
authority to make decisions that management people only
do, and that gives them wider latitude,” he says.
And
exposure to high-end planes gives them more pride and
self-worth, adds Lim.
For how
long would these retention strategies work, however, is a
big question. Based on statistics from the Philippine
Overseas Employment Administration, an average of 273,000
fresh hires are leaving each year for jobs abroad, the
bulk of which are professional and technical,
administrative and managerial, clerical, service and
production workers. This suggests that these retention
strategies could only go so far.
“We have
the risk of having extreme talent scarcity in three to
four years if we couldn’t produce enough [skilled
talents],” says Cesar Parlade, general manager of the
Deutsche Knowledge Services, a “knowledge process”
outsourcing firm.
(To be
continued) |
