Best Employers in Asia results from 2009

Hewitt Best Employers in Asia 2009
Organization	Market
• Agilent Technologies	Malaysia
• American Express (Malaysia) Sdn Bhd	Malaysia
• AVIVA-COFCO Life Insurance Co., Ltd.	China
• Becton Dickinson India Pvt. Ltd	India
• Cisco Systems	India
• Convoy Financial Services Limited	Hong Kong
• Domino’s Pizza India Ltd	India
• Dow Corning Korea Ltd.	Korea
• Eureka Forbes Limited	India
• Federal Express (Singapore) Pte Ltd	Singapore
• Federal Express Services (M) Sdn Bhd	Malaysia
• Godrej Consumer Products Ltd	India
• HCL Technologies	India
• Hindustan Zinc Ltd.	India
• Intelenet Global Services	India
• Intuit Technology Services Pvt Ltd	India
• Johnson & Johnson Medical (China) Ltd	China
• LG Electronics India Pvt Ltd.	India
• McDonald’s (China) Company Limited	China
• McDonald’s Restaurants Pte Ltd	Singapore
• Samsung Tesco Co., Ltd	Korea
• SEEK Limited	Australia/New Zealand
• SHENZHEN CATIC GROUP	China
• Thai Auto Works Co., Ltd.	Thailand
• vCustomer Corporation	India
Listed in alphabetical order

Hewitt *Best Employers in Asia 2009* - Hotels
Organization	Market
• Four Seasons Resort Langkawi, Malaysia	Malaysia
• ITC-Welcomgroup (A division of ITC Ltd.)	India
• JW Marriott Hotel Bangkok	Thailand
• The Conrad Bangkok	Thailand
• The Ritz-Carlton, Millenia Singapore	Singapore
Listed in alphabetical order

Best Employers in Asia results from 2009

When businesses are confronting external challenges, confusion, chaos and even collapse, why should they be interested in the human capital management practices of Best Employers?

The answer is simple...
In times of uncertainty and change, it is crucial to have a clear sense of direction. The HR practices of Best Employers in Asia shine a bright light on the pathway to results. Understanding those practices helps to identify where the key levers are for driving business results through people. The results also reveal a lot about how to pull those levers.

So what do the results say about how The Best differentiate themselves from The Rest? Again, the answer is simple.

Best Employers excel in three key areas:

1	Relentless execution of programs. Best Employers are more focused and disciplined in refining their human capital programs and sticking with them until they reach a point where they create the "flywheel" effect that allows them to maintain momentum and deliver results.

2	Persistent empowerment of managers. The Best are deliberate in giving more autonomy to managers. They take a markedly different approach from *The Rest* in how they allocate roles and responsibilities between senior leaders and managers. They do a better job of equipping managers to perform their roles, and they create self-sustaining reinforcement mechanisms.

3	Highly efficient HR functions. Best Employers deliver HR services and processes with fewer resources. While CEOs at all organizations generally agree that the HR function should identify and implement HR strategies and solutions aligned to business needs, CEOs at The Best are much more satisfied with the extent to which their HR teams are delivering. Ultimately, of course, business success depends on a number of factors including access to capital, a sound business model, and a host of supporting infrastructures including technology, logistics, financial systems, and so on. But, increasingly, human capital programs are viewed as a critical supporting architecture that can help organizations deliver business results. Or hinder their achievement. Our research reveals what Best Employers are doing differently to manage their human capital programs. Whether a business is struggling in difficult economic circumstances, or thriving in these challenging times, this data points to a path that others can follow. The pathway forward is simple, but - as you will see - it is not easy.

Who Are the Best Employers?
The Best Employers in Asia 2009 (See front page for list) are a diverse group, including:

1	Companies from a across Asia and from a wide range of industries.

2	Multinationals headquartered inside and outside the region, and local organizations.

3	Publicly-listed and privately-owned organizations.

4	Companies that have been on the list before, some that are making a reappearance, and others who have made the list for the very first time. We commend the 30 organizations that have been recognized as a *Best Employer.* These companies have demonstrated they are places where talented people want to work, in turn ensuring their organizations are more productive and more profitable than The Rest.

What Sets the Best Employers Apart?
Best Employers set themselves apart from The Rest in three key areas of excellence:

First Area of Excellence: Relentless Execution
Research consistently demonstrates that human capital management systems improve business results. As companies commence work to put these programs in place, they generally experience a slow up-tick in business results. The return on human capital program investment then typically continues at a gradual pace until organizations reach a "tipping point" where a dramatic rise in the return on investment is experienced. We refer to this relationship as the execution pay-back curve. It is depicted below:

Relentless Execution: Performance Management Example
For example, in the area of performance management, the three stages can be described as follows:

1	Installing (We've Got That): All the organizations in the study have systems in place to set and align goals. In this sense, all of the participating organizations have passed through the "installing" gate when it comes to performance management.

2	Implementing (We Get It): Key differences emerge when we look at how programs are implemented. *Best Employers* more often balance goals and targets across financial and non-financial measures, set the bar higher in terms of performance ratings, better equip managers to review performance, and review performance more frequently. When compared to other organizations, *The Best* have more than twice as many employees in the "improvement needed category" and fewer employees receiving the "leading performer" rating.

3	Impact (We’re Getting Results): The divergence between *The Best* and The Rest continues as the focus shifts to execution and results. Most notably, *Best Employers* indicate that the performance assessment process in their company is actually helping to improve performance!

Best Employers, through a relentless focus on execution, have moved further out on the curve and are experiencing much better pay-back on their investment in HR programs

Best Employers in Asia results from 2009

Relentless Execution: Pay-for-Performance Example
We see a similar pattern in the area of pay-for-performance. Despite the widespread prevalence of pay-for-performance programs, we again find significant differences between The Best and The Rest when we look at how pay-for-performance is implemented and the resulting impact it is having in organizations. Here, the three phases can be described like this:

1	Installing (We've Got That): All organizations in the study have some sort of pay-for-performance program in place. They all provide merit-based salary increases–and they do all provide larger increases for top performers. However, installation of other variable pay programs (e.g., short-term incentive, long-term incentive, etc.) is less consistent among participating organizations.

2	Implementing (We Get It): *Best Employers* are more likely to have variable pay programs in place beyond merit increases, they pay their high-performers more at each level in the organization, they have more differentiation in their reward structures to recognize high potentials, and they have a higher percentage of variable pay focused on long-term (as opposed to short-term) incentives at all levels of their organizations. Clearly, they have implemented pay for performance differently.

3	Impact (We're Getting Results): The different approach to implementation impacts execution and results. Employees at *The Best* see more sharply differentiated pay for high-performers and believe that the way their organization rewards and recognizes people helps produce the results the organization wants. The *Best Employers* are getting better impact.

Relentless Execution Only Part of the Story
This pattern of The Best pulling away from The Rest as we move from installation to implementation to impact is evident in other areas too (e.g., high-potential programs, succession management, employer value proposition, etc.). By maintaining focus and continually refining their approaches, Best Employers are more often reaching the tipping point where the business pay-back on human capital programs increases.

The relentless execution demonstrated by The Best, and illustrated above, is enabled by empowered managers and efficient, effective HR functions. These are the other two differentiators. To completely understand the first area of excellence, it is important, therefore, to take a close look at the other two.

Area of Excellence #2: Persistent Empowerment of Managers
The greater execution payback Best Employers achieve through persistent empowerment of managers comes from three main sources:

Focusing Leaders on Leading so that Managers can Manage
The first step in empowering managers involves clearly differentiating what is expected of managers versus what is expected from leaders. Here again, we note some important differences at Best Employers.

Leaders at The Best are twice as likely as their counterparts in The Rest to consider "providing a vision for the organization's future" as their top priority. CEOs at The Best are clearer about the kind of organization they want to create and their key promise to employees is that they will "get a sense of purpose and achievement working for this organization," while The Rest promote "an organization where co-workers talk positively and with pride about the organization." The vision and promise from CEOs at The Best is clearly finding its mark with 82% of their employees reporting senior leaders fill them with excitement for the future compared to only half of employees at other organizations.

Leaders at The Best are seen by their employees as doing a better job of balancing returns and revenue growth agendas. They are seen as being more worthy of trust and more consistently demonstrating organizational values.

At the same time, managers at The Best also have more clearly defined roles. They are seen as having much more autonomy to recognize solid and top performers, and they are seen by employees as more effective in conducting performance assessments, providing clear direction on future skills required, and finding ways for employees to grow.

Best Employers empower managers by defining roles for leaders that get them out of the way so that managers can manage. Consider, for example, how communication of reward programs and structures is managed at The Best and The Rest.

At Best Employers, Managers are more often involved in communication of reward programs and structures than their counterparts at The Rest. Interestingly, though, Senior Managers at The Best never play this role, while they do sometimes or often among The Rest. By using senior managers to communicate reward initiatives, The Rest are less able to provide the more personal and direct communication that leads to improved relevance and deeper understanding of issues in the organization. This more personal communication takes place at The Best. Simply put, leaders at The Best empower managers to manage by getting out of their way.

Better Equipping Managers to do their Jobs
Best Employers do more than just clarify roles and expectations. They also make sure managers are given the tools, skills and incentives to manage their people effectively and drive performance outcomes. They start by putting money on the table when it comes to equipping managers. They focus a larger portion of their training budget on developing the management skills of people managers.

Best Employers in Asia results from 2009

Table 1: Performance Management Implementation	The Best	The Rest	The Worst
a. We balance goals and targets across financial and non-financial measures	92%	84%	73%
b. Percentage of employees who receive the rating of "leading performer"	9%	14%	17%
c. Percentage of employees who fall into the "improvement needed" category	28%	12%	9%
d. Managers have tools and processes needed to manage performance	84%	57%	34%
e. Performance reviews are held monthly or more frequently	24%	17%	13%

At The Best, the vast majority of managers agree they have the tools and knowledge to drive performance outcomes while at The Rest about half of managers feel that way.
It is not just that Best Employers spend more, or that managers feel more equipped, what is most important is that employees can see the impact across a host of issues, as shown in the table below: Managers clearly play a critical role in connecting employees with the organization's goals and building a pathway for the development of their people that is aligned to the future direction of the organization. They do this more effectively at The Best.

Creating Self-Sustaining Reinforcement
The third source of differentiation centers on how Best Employers put self-sustaining reinforcement mechanisms in place. Business leaders and HR work together in these organizations to set the organization into a virtuous cycle where strength leads to strength. This is accomplished largely through efforts directed at three factors:
1. Culture that Delivers Sustainable Competitive Advantage: The 2009 Best Employers in Asia study included a new component focused on measuring culture and values. The results show several noteworthy differences in the organizational cultures at The Best and The Rest. Among The Rest, control, bureaucracy, cost reduction, and expense management are mentioned with much higher frequency as cultural values and organizational behaviors. This is in contrast to The Best, where the top three most commonly cited cultural values are employee recognition, coaching, and mentoring.

So, it's not surprising that The Rest are twice as likely to cite culture as an obstacle to achieving business performance. This is in stark contrast to The Best where there is little concern about culture. The Best have established their cultures largely as they would like them to be, and while there may be some tinkering going on, there is much more focus on embedding the culture into other systems.


My Manager.	The Best	The Rest	The Worst
...holds all employees accountable for setting and working towards aggressive goals	84%	58%	43%
...helps me understand the organization's goals and how my work contributes to them	85%	60%	42%
...consistently helps me find ways to grow in my job	81%	54%	36%
...provides clear direction on skills required for future success in this organization	81%	52%	34%
...directly addresses issues of poor performance	77%	56%	39%
...is more interested in the success of our team than in his/her own personal success	83%	60%	45%
...takes time to help each employee achieve their best	78%	53%	35%

Best Employers in Asia results from 2009

Table 2: Performance Management Execution	The Best	The Rest	The Worst
a. We set more aggressive goals that employees meet	56%	45%	28%
b. Managers hold employees accountable for setting and working toward aggressive goals	84%	58%	43%
c. The performance assessment process helps improve performance	82%	50%	29%

Table 3: Pay-for-Performance Execution	The Best	The Rest	The Worst
a. Overall, the way we reward and recognize people in this organization helps us produce the results we want	81%	49%	28%
b. We provide higher remuneration (higher base pay, bigger bonuses, access to long-term incentives such as stock programs, and perquisites/benefits) to high performers in our organization	75%	44%	29%
c. My performance has a significant impact on my pay	79%	52%	39%
d. If this organization does well, I will appropriately share in its financial success	79%	50%	35%

HR Workforce Service Ratio	The Best	The Rest	The Worst
a. Average HR workforce service ratio (total employees per human resource employee)	128:1	51:1	53:1

2. Systemic Benchmarking and Continuous Improvement. Put simply, The Rest are not measuring and learning as effectively as The Best . Consider, for example, that data have been available for years now on what it takes to be a Best Employer, but we still find that many of The Rest are failing to deliver on even the most basic fundamentals. On the other hand, Best Employers continue to be hungry for benchmarking data, and adopt it with greater impact. This is evident in the comments from CEOs of organizations that have been recognized previously as Best Employers and who participated again in this study. They generally indicated two principal reasons for participating–firstly, they want external validation that they are still on the right path and secondly, they want more current, robust benchmarking data that will allow them to refine their approaches. CEOs at Best Employers expect HR to be measured and assessed via systemic means, but this is not done from a "control" perspective.

On the contrary, there is a clear link between accountability and feeling valued. That is a clear example of a virtuous cycle. People want to be accountable because it makes them feel valued, and feeling valued then makes them want to deliver the discretionary effort that engaged employees demonstrate. This is self sustaining reinforcement.

3. Rewards that Reinforce Stretch Goals and Accountability. Best Employers are significantly more likely to have a pay–for–performance culture. All of The Best have a formal recognition program in place compared to only three quarters of The Rest. The Best align reward programs with results and behaviors to a much greater extent than The Rest. For example, at The Best, managers are more frequently rewarded for developing high-performers when compared to The Rest (78% vs. 42%).

The Best are also much more likely than The Rest to set stretch goals linked to pay. This is just one way they ensure their employees are being challenged constantly and pushed to achieve higher outcomes. Best Employers are three times more likely to report that their pay-for-performance and variable pay programs help them to achieve most major goals defined for the programs. Perhaps as an outcome of this, Best Employers have the confidence to push variable pay eligibility deeper into their organization. Interestingly, they enjoy a higher level of employee satisfaction with respect to their remuneration and recognition programs. At The Best, more employees believe they are paid fairly and appropriately recognized.

Employees at The Best report a far higher understanding of how rewards are determined, they have much greater confidence that reward and recognition strategies helps deliver desired results, they believe their performance has a significant impact on their pay, and they have more confidence they will share appropriately in their organization's financial success. All of that combines and leads to self sustaining reinforcement.

Of course, getting the self sustaining reinforcement model right takes a good HR team.

Area of Excellence #3: Highly Efficient HR Functions
HR clearly plays an important role in helping to drive relentless execution and persistent empowerment of managers. Indeed, the study results show that the HR function at Best Employers is more efficient and effective in helping the organization position itself for the future. Perhaps surprisingly, the data show that Best Employers deliver HR services with fewer resources.

These figures raise questions about whether the HR functions at The Best are using a fundamentally different operating model. In fact, Hewitt's research has revealed that in HR functions around the globe, significant progress has been made to drive efficiencies in service delivery. Furthermore, in the current climate, many organizations are taking a renewed interest in outsourcing as a cost-savings solution in response to the recent economic situation. Best Employers appear to be leading the way.

At Best Employers, CEO and general staff believe that the HR department identifies and implements human resource strategies and solutions critical to meeting the business needs. In other words, at Best Employers HR really is a business partner support business strategy. The HR functions at The Best are better able to deliver against their CEO's top requirements of attracting and retaining top talent. Best Employers are better able to retain staff required for success, and they experience lower level of talent shortage particularly in key areas of leadership, project management, and client management.

Closing
As we said at the outset, the data reveal what Best Employers are doing differently to manage their human capital programs. The Path is clear. The pathway forward is simple. And it is not easy.

Now that the pathway is known, which way will you take your organization?

Richard Kantor is Hewitt's Asia Pacific Talent & Organization Consulting practice leader and can be reached at richard.kantor@hewitt.com

Best Employers in Asia results from 2009

The regional judges for the Hewitt Best Employers in Asia panel were:

Professor Arthur Yeung - Chairperson
Philips Chair Professor of Human Resource Management; Founder & Director, CEO Learning Consortium; Director, Centre of Organization and People Excellence; Associate Dean, China Europe International Business School; Professor of Business Administration, Ross School of Business, University of Michigan (4th time on panel, 2nd time as Regional Chairman)

Associate Professor
Siriyupa Roongrerngsuke, Ph. D.
Executive Director - Head of Human Resource Program, Sasin Graduate Institute of Business Administration of Chulalongkorn University (4th time on panel)

Christine Brendle
Managing Director Asia, Dow Jones Consumer Media Group (2nd time on panel)

About the criteria
The judging panel used two sets of criteria in judging the Hewitt Best Employers in Asia:

1. Key criteria that are fundamental to the definition of a Best Employers:

•	Engagement scores and alignment scores that are adjusted across markets to reflect rater bias

•	Sustainability in good and bad times, especially in view of current economic downturn. The panel focused on three broad indicators around the quality of leadership, commitment to customers, and commitment to people based responses to the employee opinion survey. They also reviewed the interview notes regarding the responses of companies during the current economic crisis.

2. Additional consideration was give to in the final selection to:

•	Size/complexity factor, ensuring that the challenge of big and complex organizations was duly considered.

•	Cultural alignment based on Barrett's Cultural Tool scores, especially the misalignment indexes.

•	Quality and quantity of employee comments on their perception of their employer.

About the key characteristics
The judges found the following characteristics in the Hewitt Best Employers in Asia:

•	A strong commitment of the CEO on taking good care of people in both good and bad times, along with their commitment to people and customers being upheld during the current economic crisis

•	Alignment between human resources systems/initiatives and employee perception which reflects the high quality implementation and execution of human resource systems and initiatives. HR initiatives which were highly regarded by the judges were those being executed with strong sponsorship and commitment from the CEO and line executives rather than those being "pushed" by HR professionals

•	Best Employers are diverse and can come from very different industries, sizes, markets, and nationality (multinational firms and local firms)

•	Very high employee engagement and alignment scores

•	Strong commitment and conviction of top leaders to the importance of people to business success

•	Good design and high-quality execution of HR initiatives and systems

•	Positive comments from employees toward the companies

We are excited about the
increasing awareness
and commitment of
companies to become
Best Employers. The
bar is getting higher
and higher which
reflects the continued
progress of companies
in their human resource
management practices
over the years. We
also commend the
strong commitment of
Best Employers to take
care of employees and
customers during this
challenging period.
Clearly, these Best
Employers maintain a
good balance between
short-term business
pressure and long-term
sustainable success.

- Professor Arthur Yeung

Hewitt Best Employers in Asia 2009

Hewitt Best Employers in Asia 2009 - Hotels

Best Employers in Asia results from 2009

When businesses are confronting external challenges, confusion, chaos and even collapse, why should they be interested in the human capital management practices of Best Employers?

Best Employers in Asia results from 2009

Best Employers in Asia results from 2009

Best Employers in Asia results from 2009

Best Employers in Asia results from 2009