STRATEGIC HR

HUMAN CAPITAL MANAGEMENT IN SOUTHEAST ASIA

JULY 2012 www.americantrainingteambuilding.com VOLUME 1 ISSUE 1

Table of Contents
FEATURE Corporate Employee Engagement ECONOMIC VIEWPOINTS US: Alternatives to Tax Increases China: Meeting Expectations by Lowering Growth India: Stagnation Politics leads to Slower Growth QUICK TOPICS Online Pricing Discrimination Drug Legalization Page 3 Page 3 Page 2 Page 2 Page 1 Page 1

Feature: Corporate Employee Engagement

Corporate Employee Engagement (CEE) is the sense of an employee's purpose and meaning within their position leading to increased productivity. It is an essential part of having effective management and a high-performance culture within the organization as employees understand their roles and purpose. TYPES OF EMPLOYEES There are three major types of employees within an organization. The first type is the engaged employee who has a sense of purpose and understand his/her impact on the organization. The second type is the disengaged employee who do not understand how his or her purpose nor the impact on the organization. The final type is the actively disengaged employees who act out their insecurities within their positions and undermine other co-workers. Both disengaged and actively disengaged employees have low productivity, poor health, and work-related stress leading to their resignations. Exiting employees lead to operational inefficiencies and negative customer satisfaction. The organization suffers due to increasing turnover costs and eroding corporate profits. BENEFITS OF A CEE PROGRAM According to Hewitt Quarterly Asia Pacific, a newsletter provided by Aon Hewitt who specializes with strategic human resources consulting services, organizations with high employee engagement are 78% more productive and 40% more profitable. A profitable organization with an under engaged workforce will have profits that are short-lived compared to an underperforming organization with highly engaged workforce. Organizations applying a CEE program nurture the best teams with loyal and innovative employees allowing for greater improvement in productivity and revenue growth. (Continued on Page 3)

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United States: Alternatives to Tax Increases

After the financial crisis of 2008, recovery has been sluggish since the Dow Jones hit a high of 14,164.53 on October 7, 2007. Rising oil prices and Europe Debt Crisis have slowed the recovery of the US economy. The current year guarantees no new tax reforms until after the 2012 Presidential Election in November. However many states need revenue and tax increases maybe in their future but certain states are looking beyond taxing their citizens to raise revenue. Gambling, alcohol, and fireworks are becoming alternatives to raise revenue rather than increasing taxes. Washington State began auctioning their liquor licenses while Georgia lifted their ban on alcohol on Sundays. Massachusetts became the 24th state to allow casinos last year similar to Ohio in 2009 and Maryland in 2008. Both Maine and Rhode Island lifted the ban on fireworks and expand gambling casinos. These alternatives to taxations prevent the loss of sales to other states and return lost income and revenue through job creation. According to Strauss-Howe Generational Theory, the United States is currently undergoing a crisis period. Both Medicare and Social Security will be exhausted in 2024 and 2036, respectively, due to the financial pressures from the baby boomer generation. Less people are paying into these programs as the population of the aging baby boomer generation increases.

Both disengaged and actively disengaged employees have low productivity, poor health, and workrelated stress leading to their resignations. Excerpt text from the main text of a story to draw a readers attention to the page.

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STRATEGIC HR

China: Meeting Expectations by Lowering Growth

Last May Goldman Sachs cuts Chinas GDP forecast for 2012 from 9.5% to 9.2%. China reported trade deficit of $31.5 Billion in February however its trade deficit dips around Chinese New Year raising fears Chinas economy will slow sharply. However the fall in the trade deficit also resulted in a fall of inflation giving the Chinese Central bank room to boost economy to increase its countrys consumption.

Slower growth would allow China to manage expectations as well as create space for structural reforms.

On March 5th the annual meeting of the National Peoples Congress (NPC) announced China is expected to grow at 7.5% in 2012 compared to the 8% rate set for the past 7 years. This is half a percentage point lower to obtain social stability where millions of Chinese citizens enter the labor force each year. According to the Economist, the labor market between 1991 and 2000 grew to 8.7 million a year however this year China is expecting 5.2 million to enter the workforce. China can get away with slower growth and sacrifice speed for balance. The growth rate only fell below 8% in the past twenty years during the Asian Financial Crisis between 1998 and 1999. Slower growth would allow China to manage expectations as well as create space for structural reforms. But the gap between the rich and poor continue to widen as the Communist party continues to expand towards the private sector though hybrid corporations. These expansions currently involve seizure of lands for private development. China is the world leader to promote state capitalism or hybrid corporations. Now many Chinese people are migrating to other provinces to find work. This Chinese migration is impacting and transforming the Chinese economy. The Happiness Index within Chinas cities has been declining for four years where worries about income are the reason for the drop. The Happiness Index is also called per capita disposable income and real value of GDP.

India: Stagnation Politics leads to Slower Growth

Indias growth rate has fallen to 5.3%, which is the lowest in 7 years. India needs to grow 6% or more to maintain social stability as millions of Indian citizens enter the labor force each year. Otherwise slower growth would mean less jobs and more poverty. India is the democratic counter-weight to China however its government may be holding back growth. Corruption scandals and raising subsidiaries on commodities have increased the Indias deficit. The Reserve Bank of India is one of the best central banks balancing both growth and inflation and fostering a booming economy however Indian politics may be doing the opposite as they refuse to back reforms now. Both Indian confidence and investment slipped as Europe and the Americas recover from their respective financial crises. The next National Election is in 2014 and no new reforms are on the books, industrial investment is stagnant, higher inflation, and both foreign and private investment has slowed. India needs politicians who are ready to overcome their stubbornness and achieve worthwhile compromise.

India needs to grow 6% or more to maintain social stability as millions of Indian citizens enter the labor force each year. A caption is a sentence describing a picture or a graphic.

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Online Pricing Discrimination

Online sellers are using price customization software to target groups of people who can pay higher prices. The cookies allow them to track the IP address and neighborhood where the customer lives. Affluent neighborhoods will be charged higher prices than middle-class neighborhoods. Amazon.com used price customization software to charge different rates for DVD prices depending on the browser the customer is using in 2000. The public backlash resulted with Amazon.com reimbursing customers who were overcharged. Some of the techniques to fool these software includes to surf on a PC not an Apple, take your time going to the checkout page, and compare prices on online forums.

Drug Legalization
Many of the South American countries are evaluating the War of Drugs and the possibility of regulation and legalization of drugs to curb profits from drug lords. One former Latin American General mentioned the legalization will rid money laundering, smuggling, arms trafficking, and corruption. However many leaders in developing countries believe this could be a ploy to get more foreign aid. Currently Peru is the largest cocaine exporter replacing Brazil who stepped up the War of Drugs with its neighbor Bolivia.

Corporate Employee Engagement

CORPORATE CULTURE (Continued from Page 1) Developing a CEE program begins with creating the proper corporate culture where hope empowers will. Hope needs direction otherwise it could lead to pessimism or an unlikely negative outcome. Corporate cultures direct the level of hope where decisions are put into place. Corporate culture includes defining values, beliefs, directions, and expectations which will ensure a positive morale within an organization. CORPORATE COMMUNICATION PROTOCOLS It is important to communicate the corporate culture through protocols designed to be consistent, clear, and concise. Communication protocols must provide strategic advice between management and employees including organization's priorities, strategies, and current level of performance. Management has the responsibility of providing a consistent frequency and venue for the information to be released so employees are aware when and where the information is released. A disengaged manager will lead to disengaged employees who are resigning to get away from a bad manager. It is important to link employee engagement to high performance starting with the CEO and the first line managers. Communication must flow from a macro to micro level. Customer satisfaction, current levels of quality, training and performance must all be measured and communicated. HIRING AND TRAINING PROGRAMS It is important to hire correctly with the right behaviors matching your corporate culture traits. Identifying employees who match the corporate culture will create the competence needed to establish an effective CEE program. Clarity must be established for employees to understand their job expectations. Employees will be looking for ways to improve however they need the right tools. Having the right employee with the combination of knowledge, skills, and behavior to improve performance will allow employees to be more engaged because they feel they have influence within the corporation.

One former Latin American General mentioned the legalization will rid money laundering, smuggling, arms trafficking, and corruption.

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STRATEGIC HR

Corporate Employee Engagement

MEASURE FEEDBACK FROM EMPLOYEES Once corporate culture and communication protocols have been established, the organization's hiring and training programs need to be tested through feedback mechanisms. Activities include engaging employees by asking questions including what to start doing, what to stop doing, and what to keep doing within an organization. Engaged employees take ownership within organization. Measuring these answers will indicate the level of employee satisfaction and impact current leadership. Leadership is the level of self-awareness on has over the situation. Measurement tools include progress reports, employee assessments, and 360-degree reviews to create a benchmark for performance comparison. The CEE program must be able measure employee feedback to determine to the current status coincided with appreciation and reward incentives. Showing respect through appreciation must be specific and frequent so the employee can relate to the accomplishments rather than general praises which are mean meaningless. Reward incentives recognize realistic targets employees have achieved. Other tools include face-to-face, survey drives, discussion forums where common purpose, vision, and values. These tools create an attractive environment for trust to be created. More informed and involved employees are productive when two-way communications are open to involve them within any decision-making process. Employees need an opportunity to be heard without fear of reappraisals so trust is created between them and the organization. It is important to listen and understand employee feedback as it is an important part of corporate culture as well as the CEE program. MISCONCEPTIONS OF EMPLOYEE ENGAGEMENT Employee engagement is neither happiness nor motivation. Employment engagement is the both the emotional and intellectual level the employee can sustain satisfaction within the workforce. It defines the employee's purpose within an organization and their ability to influence the outcome. High-commitment organizations with a sense of dedication, motivation, and a sense of belonging out-perform those with low commitment. It is important never to stereotype employees by class, age, race, etc. Stereotyping leads to the wrong conclusions because every employee has different needs and values. It is important not to project how a manager would like to be treated as an employee. Not all employees are motivated by money however all are motivated by achievement. It is important to understand that people are engaged very differently within an organization. A properly incorporated CCE program within an organization includes a process of communicating the corporate culture to trained employees and measuring their feedback. It focuses on relationships rather than tasks. CEE programs create a positive corporate culture fostering a learning environment for employees. A learning environment promotes creativity leading to increasing employee contributions to the organization. Employees within these learning environments will have a sense of belonging and will work harder if things do not go as planned.

American Training & Team Building Asia

We believe in the next generation of evidence-based HR expertise to compete with todays global markets. We believe every organization has a unique corporate culture, which needs to be nurtured with the appropriate customized training and teambuilding programs. We offer organizations to make sense of the changes within both the workplace and marketplace. Our mission is to provide the latest training and team building expertise to both international and local companies within the Asia-Pacific region. We are an American born and raised team of accomplished international trainers who have designed and delivered corporate training and management consulting projects for thousands of employees in Southeast Asia including China, Indonesia, and Malaysia. Our clients include multinational and publicly-listed companies in the Asia-Pacific region including Ericsson, Petronas, Deloitte, Pfizer, Standard Chartered Bank, Oracle Corporation, Sapura, Adecco, Experian, Prudential Insurance, New York Life, Metlife, and MBF Cards. Our strategic human capital management professionals provide expertise across multiple corporate entities including the information publishing environments, equity markets, manufacturing, and the financial services industry. Our team are graduates of Industrial and Organizational Psychology and achieved Masters in Business Administration.

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