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back to index backASIAtalk November,  2005


Asia's Top HR Challenges - snapshots from the edge

For such a vast and diverse region, one with a multitude of languages , cultures, religions and industries, it is challenging to create a unified vision of HR that applies to all. Ensuring consistency and unity across HR policies and practices while balancing local needs and requirements is a major concern for regional HR heads. It is by no means an easy challenge with so many on-the-ground differences to be accounted for.

In a bid to understand some of the unique challenges and synergies HR managers are facing in countries around the region, HCA approached practitioners in several countries to get an overview of what HR issues are top of their agenda.

While China employers are confronted with complex labour laws, India is battling lack of leadership. HRMs in Singapore have to create a balance between foreign and local talent, while both Australia and New Zealand face their lowest unemployment levels ever and as such the labour market has shifted power from employers to jobseekers. Employers have to work hard to attract talent to their company and their brand, as being an employer of choice is becoming all the more critical in the talent war. Under this challenge come issues of talent retention  one of the hottest topics in HR circles globally. Talent retention and development are concerning HRMs from Australia to Thailand.

When it comes to retaining employees, an organisation's ability to provide effective leadership can be the critical differentiator in the war for talent. Not surprisingly, the importance of leadership also stood out as a key HR challenge in Asia. Several of the academics and practitioners HCA heard from identified leadership as one of the biggest HR challenges their countries face.

Our findings revealed another consistent area of concern  the lack of respect for HR is an issue felt far and wide in the region. While less developed countries will feel this marginalisation more acutely than others, the need for HR to step up to the table and gain respect for their business acumen was cited as a key challenge by many academics and practitioners in the region.

And so it seems that despite the region's diversity, as business is played on an increasingly global playing field, so too are the people-related challenges becoming global. It is down to HR to ensure the solutions implemented to tackle these challenges are both global in perspective, to ensure consistent best practice HR across countries, and locally relevant. Here we profile some of the respondents to our research and the issues they've identified as topping their agendas.

Australia

Area: 7.68 million sq km
Population: 19.5 million
Capital: Canberra
GDP: US$418bn
GDP per capita: US$22,000
Major industries: Minerals, oil, coal, gold, wool, cereals, meat, tourism
Major trading partners: Japan, ASEAN countries, South Korea, China, New Zealand, US, EU
Population growth rate: 0.87% (2005 est)
Net migration rate: 3.91 migrant(s)/1000 population (2005 est)
GDP  Composition by sector: Agriculture 3.4%; industry 28.2%; services 68.4% (2004 est) Labour force: 10.35 million (2004 est) Labour force  by occupation: Agriculture 3.6%; industry 26.4%; services 70% (2004 est)
Unemployment rate: 5.1% (December 2004 est)
Women's share of adult labour force: 45% (2003)

NICOLE ECKERMANN
HR advisor, Origin Energy

Top HR challenges in Australia

" Industrial relations reform.

" Skills shortages.

" Ageing workforce.

" Flexible working arrangements/work-life balance.

" Proactive training and development.

Your top company HR challenges

" Waiving for 2005 for Equal Opportunity for Women in the Workplace Act (EOWA).

" Providing employment conditions consistent with community expectations.

" Working towards a diverse workforce.

" Providing the necessary job training for employees to assist in their careers.

" Encouraging and supporting employee initiatives (ie matched giving, etc).

Top priority for HR in 2005

" Employer of choice accreditation.

LOUISE METCALF
Principal consultant, Macquarie University, Australia

What are the top HR challenges in Australia?

" The current skills shortage, particularly in technical .elds like engineering.

" The skills shortage is encouraging organisations to examine staff engagement and to design strategies around key aspects of HR management to enhance staff engagement.

" Skilling staff appropriately through in-house training rather than going to an already depleted labour market.

" The issue of work-life balance and the place of these types of strategies in engaging staff in the organisation or positioning the organisation as a desired employer.

" The impending threatened changes to industrial relations in Australia and the changes to HR internal structure and staff expectations that this will create.

People's Republic of China

REGIONAL FOCUS
Area: 9.59 million sq km
Population: 1.28 billion
Capital city: Beijing (pop 13.8 million)
GDP: US$6.4trn
GDP per capita: US$5000
Major industries: Iron, steel, coal, machinery, automobiles, petrolium, chemicals, telecommunications, textiles Major trading partners: US, Japan, Germany, South Korea, Taiwan
Population growth rate: 0.58% (2005 est).
Net migration rate: -0.4 migrant(s)/1000 population (2005 est)
GDP  Composition by sector: agriculture 13.8%; industry and construction 52.9%; services 33.3% (2004 est.)
Population below poverty line: 10% (2001 est)
Labour force: 760.8 million (2003) Labour force  by occupation: agriculture 49%, industry 22%, services 29% (2003 est) Unemployment rate: 9.8% in urban areas; substantial unemployment and underemployment in rural areas; an official Chinese journal estimated overall unemployment (including rural areas) for 2003 at 20% (2004 est).
Women's share of adult labour force: 47% (2002)

TANG NINGYU
Associate professor, Shanghai Jiaotong University

Top HR challenges in China?

" Playing the strategic partner role in company.

" Recruiting the right person.

" Pay for performance.

" Empowerment.

" High turnover in certain industries.

C H TANG
Group head  internal affairs, Sun Hung Kai Properties Limited

Top HR challenges in China?

" Skills and quality of the workforce.

" High labour cost.

" More labour-related laws that constrain flexibility in hiring.

" Loyalty and commitment of the workforce.

" Lack of sense of crisis.

Top company HR challenges?

" Talent development.

" Succession.

" Retention and motivation.

" Attraction and selection of the right candidates.

" Training and developing of the staff force

INDIA

Area: 3.28 million sq km
Population: 1 billion
Capital: New Delhi
GDP: US$2.2trn = GDP per capita: US$2200
Major industries: Textiles, chemicals, food processing, steel, transportation equipment, cement, mining, petroleum, machinery, rice, wheat, oilseed, cotton, jute, tea, sugarcane, potatoes, cattle, water buffalo, sheep, goats, poultry, fish Major trading partners: US, Hong Kong, UK, Japan, Germany, Belgium, Saudi Arabia
Population growth rate: 1.4% (2005 est)
Net migration rate: -0.07 migrant(s)/1000 population (2005 est)
GDP  Composition by sector: agriculture 23.6%; industry 28.4%; services 48% (2002 est)
Population below poverty line: 25% (2002 est)
Labour force: 482.2 million (2004 est) Labour force  by occupation: agriculture 60%, industry 17%, services 23% (1999)
Unemployment rate: 9.2% (2004 est)

SHIVGANESH BHARGAVA
Professor of organisational behaviour and human resource management, Indian Institute of Technology, SJM School of Management, Mumbai

What are the top HR challenges in India?

" Crisis of talent in organisations, while India is full of talent.

" Identifying, developing and retaining competent people.

" Leadership crisis.

" Deteriorating people and organisational health.

" Changing face of HR in the global technology era

 

Japan

Area: 377,835 sq km
Population: 127 million
Capital: Tokyo
GDP: US$3.15trn GDP per capita: US$24,900
Major industries: High-tech electronic products, motor vehicles, office machinery, chemicals, steel, textiles, processed foods
Major trading partners: US, Hong Kong, Taiwan, South Korea, Germany, China Population growth rate: 0.05% (2005 est)
Net migration rate: 0 migrant(s)/1000 population (2005 est)
GDP  Composition by sector: agriculture 1.3%; industry 24.7%; services 74.1% (2004 est)
Population below poverty line: N/A Labour force: 66.97 million (2004 est)
Labour force  by occupation: agriculture 5%, industry 25%, services 70% (2002 est.)
Unemployment rate: 4.7% (2004 est)
Women's share of adult labour force: 41% (2003)

KOJI MATSUNAGA
Senior manager of human resources, DENSO Corporation

Top HR challenges in Japan?

" Hire capable employees in the ageing population with fewer children.

" Enhance HR systems and programs, in view of CSR.

Your top HR priorities?

" Enhance education programs for leaders worldwide.

" Develop programs and improve activities to increase motivation of DENSO group employees.

" Share the values and beliefs, called 'DENSO Spirit', that DENSO honours, with DENSO group employees worldwide to work together toward the same goals.

" Strengthen programs to promote direct communications in English between Japanese employees and non-Japanese employees.

" Establish global standards for developing programs

MALAYSIA

Area: 329,750 sq km.
Population: 23 million.
Capital: Kuala Lumpur.
GDP: US$99bn.
GDP per capita: US$4530.
Major industries: Tin, rubber, palm oil, timber, oil, textiles, electronics.
Major trading partners: Singapore, Japan, US.
Population growth rate: 1.8% (2005 est.).
Net migration rate: 0 migrant(s)/1000 population. (Note: does not reflect net flow of an unknown number of illegal immigrants from other countries in the region (2005 est).
GDP  Composition by sector: agriculture 7.2%; industry 33.6%; services 59.1% (2004 est).
Population below poverty line: 8% (1998 est).
Labour force: 10.49 million (2004 est). Labour force  by occupation: agriculture 14.5%; industry 36%; services 49.5% (2000 est).
Unemployment rate: 3% (2004 est).
Women's share of adult labour force: 35% (2000)

ASSOCIATE PROFESSOR ZAINAL ARIFFIN AHMAD
Deputy dean at the Research and Graduate Studies School of Management, Universiti Sains Malaysia

Top HR challenges in Malaysia?

" To become strategic partner in business.

" What HR function to keep versus outsource  why do we need HR?

" Professionalisation of HR (ie certification under MIHRM).

" Costing HR  HR metrics, HR scorecard, HR benchmarking. " The future of HR in public services  what form will it take?

THAILAND

Area: 517,000 sq km
Population: 62 million
Capital: Bangkok GDP: US$166bn GDP per capita: US$2168
Major industries: Computers, garments, integrated circuits, gems, jewellery
Major trading partners: ASEAN, US, European Union
Population growth rate: 0.87% (2005 est)
Net migration rate: 0 migrant(s)/1000 population (2005 est)
GDP  Composition by sector: agriculture 9%; industry 44.3%; services 46.7% (2004 est)
Population below poverty line: 10% (2004 est)
Labour force: 36.43 million (November 2004 est)
Labour force  by occupation: agriculture 49%, industry 14%, services 37% (2000 est)
Unemployment rate: 1.5% (November 2004 est)
Women's share of adult labour force: 45% (2003)

TRUONG QUANG
Associate Professor in HRM, Asian Institute of Technology

Top HR challenges in Thailand?

" Awareness at top management level about the strategic role and contribution of HRM to the bottom line, and in the long run.

" Consistent/ transparent HRM policy, which is linked with organisation's strategy. " Training budget, according to development plan.

" How to retain key employees/'brain gain' policy.

" HRM 'best practices' in all sectors.

HONG KONG

Area: 1092 sq km
Population: 6,898,686GDP: US$234.5bn
GDP per capita: US$34200
Major industries: Textiles, clothing, tourism, banking, shipping, electronics, plastics, toys, watches, clocks
Major trading partners: ASEAN, US, European Union
Population growth rate: 0.67% Net migration rate: 5.24 migrant(s)/1,000 population (2005 est.)
GDP  Composition by sector: agriculture 0.1%; industry 11.3%; services 88.6%(2004 est)
Population below poverty line: NA Labour force: 3.54 million (October 2004 est.) Labour force  by occupation: manufacturing 7.5%, construction 2.9%, wholesale and retail trade, restaurants, and hotels 43.7%, financing, insurance, and real estate 19.2%, transport and communications 7.9%, community and social services 18.5%
Unemployment rate: 6.7%( 2004 est)

LEE QUANE
General Manager, ECA International Ltd

Top HR challenges in Hong Kong?

" Trying to get foreign talents into the Hong Kong workforce is getting more and more difficult. This is also because families do not want to relocate to Hong Kong owing to non-availability of seats for children in International schools in Hong Kong.

" With the growing competition from Mainland China, many offices are relocating the headquarters to Shanghai. In terms of recruitment, many locals are therefore moving to Shanghai

" With recent improvement in job markets, people are changing jobs and the turnover rate is higher than it was last year

SINGAPORE

Area: 683 sq km
Population: 4 million
GDP: purchasing power parity  $120.9bn (2004 est)
GPD per capita: purchasing power parity  $27,800 (2004 est) Major trading industries: electronics, chemicals, financial services, oil drilling equipment, petroleum refining, rubber processing and rubber products, processed food and beverages, ship repair, offshore platform construction, life sciences, entrepot trade
Major trading partners: Malaysia 15.8%, US 14.3%, Hong Kong 10%, China 7%, Japan 6.7%, Taiwan 4.7%, Thailand 4.3%, South Korea 4.2% (2003)
Population growth rate: 1.56% (2005 est)
Net migration rate: 10.3 migrant(s)/1000 population (2005 est)
GDP  Composition by sector: agriculture 0% negligible; industry 32.6%; services 67.4% (2004 est)
Population below poverty line: N/A
Labour force: 2.18 million (2004 est) Labour force  by occupation: manufacturing 18%, construction 6%, transportation and communication 11%, financial, business, and other services 49%, other 16% (2003)
Unemployment rate: 3.4% (2004 est)
Women's share of adult labour force: 40% (2000)

TAN HWEE HOON
Associate Professor, National University of Singapore

What are the top HR challenges in Singapore?

" Restructuring of our local workforce (especially at the lower levels) to become more versatile and more willing to adapt to the changing world economy.

" The retention of top local talent, such that their aspirations are met.

" The management of foreign talent in relation to their local counterparts.

" Professionalism of the HR function, especially within the local organisations.

" The ability to attract more women into the workforce.


Source: Human Capital Asia - GAI


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