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Business backbone

Released at: 23:53, 05/01/2015

Business backbone

Companies in Vietnam are increasingly viewing HR management as the core foundation of business development.

by Thong Dat

Human resource (HR) strategies have continued to be a topic of great interest over recent years. Gone are the days when the HR Department was viewed as an administrative overhead. HR professionals now have the opportunity to play a more strategic role in the business. The increased degree to which HR strategies and HR departments contribute to strategic decisions of companies speaks volumes about their significance. 

Widely debated is the question of whether multinational corporations (MNCs) generally deploy superior HR strategies compared to local companies. Mr. Arnold Chan,  Member of the Judging Panel of Singapore HR Awards and Vietnam HR Awards 2014, noted that Vietnamese companies are highly recognized for their flexibility, creativity and adaptability, especially in the working environment. “Meanwhile, MNCs are best known for their professionalism and standard measurement methods, which help develop a HR strategy that is closely connected with the business strategy,” he said.

Most dilemmas and questions of HR Managers these days relate to the topic of talent management. Obviously, attracting and retaining talent is an issue of great concern for both local companies and MNCs in Vietnam. And when it comes to creating a working environment that will help companies keep the best talent, there is no one-fits-all solution. This is especially true regarding Gen Y employees as they become a major proportion of Vietnam’s workforce.  

For example, the average age of employees at Intel Products Vietnam is 28, so one of the challenges in managing such a young workforce, according to Ms. Sherry Bogey, General Manager of Intel Products Vietnam, the Best Winner of Vietnam HR Awards 2014, is that management always has to make sure they give Gen Y employees opportunities to learn and grow. “At an average age of 28, most of our employees desire to pursue higher education to enhance their knowledge and skills,” she said. “Our Gen Y employees have an unquenchable thirst for learning new things. We strive to inspire them in their never-ending quest for knowledge and skills, and make sure we have fun along the way.”

Intel Products Vietnam has various programs to support its employees in further education, such as the Extended Education Program, and offer a flexible working schedule to support employees pursuing higher education. It also has other special policies designed to help employees finance the purchasing of house or car, and it is one of just a few companies in Vietnam that pay the interest on loans employees take out from banks. 

The Vietnam HR Awards 2014 were co-organized by Talentnet and the Labor & Social Affairs newspaper and endorsed by the Ministry of Labor, Invalids and Social Affairs (MoLISA). The Awards are the first of its kind in Vietnam, recognizing and honoring businesses with excellent HR policies, promoting effective HR strategies, and providing a venue for learning and sharing HR policy and practices that contribute to the development of enterprises and employees. Adopting a professional methodology from SHRI, an international organization, the Awards are acknowledged as transparent in the judging process and professional in award categories and criteria. The Awards had five award categories: (i) Best Workplace Environment, (ii) Compensation & Rewards Management, (iii) Training & Human Capital Management, (iv) Manpower Planning & Resourcing, and (v) Performance Management. The Judging Panel also introduced the “HR Transformation Champion” category to recognize efforts of companies that have gone through transition periods but still focused on investing in HR and achieved encouraging results.

Increasingly, companies are realizing that HR policies need to be designed to create a great working environment. The leading ICT company in Vietnam, FPT, for instance, is one of just a few that have maintained and celebrated traditional days for many years. The company celebrates Community Day, Towards the Origins Day, Art Performance Day, and especially FPT’s Village Festival. The Festival is organized before the annual Tet holiday with the desire to recreate the atmosphere of traditional Vietnamese festivals and to create an opportunity for employees to celebrate together after a hard year at work. On this day the highest-ranked individuals in terms of performance and contribution are named and ordained Trang Nguyen, Bang Nhan, and Tham Hoa - old titles for lead scholars in the Court examinations of the past. Culture is the power of FPT and the spiritual glue that holds all its employees together, inspiring each other to be even more dedicated and creative for the company’s sustainable development.

The significant difference is that FPT acknowledges everyone as who they are, with their own strengths and weaknesses, the good and the bad. It always respects, listens to and encourages everyone to be themselves. At FPT, staff can discuss matters with managers on an equal footing. Listening to different opinions is how FPT leaders avoid making wrong decisions and it encourages creativity and a spirit of innovation within each employee.

Besides the working environment, companies now attach increasing importance to training programs as well. This is especially true given that a lot of companies in Vietnam cannot find enough workers with the suitable skills. Talent development and training is a business that requires major investment and know-how and it seems that MNCs have an advantage in this respect over local companies, as they can adopt the standard training and development system inherited from their parent groups. 

For example, employees will be trained and developed in vain if no career development options exist for them at the company. This is clearly not the case at the InterContinental Hanoi Westlake, as each employee is offered realistic career options from when they first join the hotel. The InterContinental also has a professionally-developed employee handbook - an easy-to-use tool for employees - that helps them to settle down in the first six months. The hotel also has a tie-up with Harvard University to offer 40 online courses for employees. 
Many other companies have similar arrangements with different institutes, while some, like HSBC, have their own business school. The HSBC Business School has a mission to provide guidance and suggestions to bank staff on their training direction. For example, a customer relations manager will have a list of suggested courses and can choose to develop skills corresponding to the capabilities needed for his or her job. Just as HSBC has its own business school, Samsung Vina Electronics has the Samsung Business Academy (SBA), which provides training programs not only for Samsung staff but also other people.

Several of the country’s largest employers are retailers and require plenty of employees in order to operate their stores and expand. Mobile World, for example, currently employs 9,000 workers and must employ 400 new employees each month as it expands by an average of one new store every two days. It may be surprising for some to learn that such a high level of recruitment is conducted solely by Mobile World’s 15-strong HR Department. 

Mobile World’s approach to recruitment helps make life easier for the company. As it has expanded to Vietnam’s 63 cities and provinces, its HR Department has teams of young local supporters who provide hints and help identify the best prospective employees. Once materials are in hand, the HR Department goes to locations to conduct recruitment. One advantage for the HR Department in making its recruitment process easier and faster is that its members are young and not afraid of frequent travel around the country.

Most companies say that they value their employees and offer generous benefit packages. But in an emerging economy, where employees are often overworked and many businesses are pulling the plug on raises and extra benefits, some companies are shining stars when it comes to offering their employees good compensation and rewards. Unilever is one, not only because of the competitive salary they offer but also the other benefits available. A competitive salary, an annual bonus based on performance, and a long list of other in-kind benefits, including Unikhoe - the private medical scheme, health check-up, and pension fund - is just the start. And as employees progress in their careers they receive higher salaries and greater benefits.

“The establishment of HR policies and guidelines sets out responsibilities, consistencies, and standards of behavior as well as commitments in relation to regulation and corporate governance for our employees. It also provides flexibility to managers to make some judgment calls depending on the situation or circumstance. HR policies also support in various ways to have the biggest effect on talent and organizational performance.” 

Ms. Sherry Bogey, 
General Manager, Intel Products Vietnam

“Both MNCs and local organizations have very good HR practices and many have their people in mind when their HR professionals develop HR systems that work for the company. Alignment is there and many have positive long-term effects on productivity and attracting and retaining talent.”

Mr. Arnold Chan, Judging Member of the Singapore HR Awards and the Vietnam HR Awards

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