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Preparing Your Company for a Global Pandemic

Posted on November 23, 2009 by | 2 comments

Author:
Mariana Villa da Costa – Littler Mendelson

Over the last decades, we have seen new infectious diseases appear, some of which could kill millions of people within days: mad cow disease, bird flu, SARS, Hantavirus, Ebola, dengue fever, and most recently, spread of the H1N1 “swine” flu.  In 2009, the World Health Organization declared H1N1 a pandemic.  As of November 15, WHO reports that H1N1 is present in over 206 countries and territories globally, and over 500,000 cases have been documented.  The pandemic raises many HR issues, especially for global employers.  Why?

The workplace is an ideal place for spreading disease, from the common cold to the serious swine flu, as people are in a close daily contact, sharing printers, telephones, eating together in the office’s kitchen, and, most of the time, breathing the same, re-circulating air.  Every company strives to keep its employees healthy and safe, not only for their own benefit, but also to ensure its operations continue full force.  Let’s highlight a few of the issues companies need consider when preparing a plan to address a global pandemic:

Go global, but do not forget local!

Companies can draft a global, standard pandemic plan, but you still need to account for different laws and regulations in the specific countries or regions where you operate. So make sure your company reviews any local employment and health laws before implementing the plan, in order to avoid potential legal issues and liabilities.

What’s in the plan?

Every global pandemic plan must address at least these issues:

  • Communication – Procedures on how an employee must inform their employer of a disease and steps the company needs to take to ensure immediate safety for the sick employee and the other employees.
  • Discipline – How the company should deal with employees who refuse to go to work for fear of getting sick, and measures for abusive and unfounded absences.
  • Privacy – How the information about a sick employee or a sick family member must be managed, including required government reporting.
  • Shut Down – If a shutdown of the company facility becomes necessary because of the spread of a contagious disease, the company needs to define, according to domestic laws, how employees will be paid and alternative ways to keep the employees working.
  • Travel issues – Your plan should address issues related to employees traveling for work to risky locations.  The plan should cover the conditions when travel should be deferred or suspended. It should also address how employees traveling for personal reasons should deal with a potential contagious disease in order to protect the rest of your workforce.

Adapt, adapt and adapt!

Once you have your broad global pandemic plan, consult a local or international lawyer to draft specific provisions and re-write any conflicting ones, just like most companies do for their other global policies, such as Codes of Conduct, discrimination and harassment policies.

Tell your employees!

Communication is key.  Make employees aware of the implementation of a global plan by preparing presentations and/or training on the issues addressed by the plan. Use simple, common language to make sure employees understand the plan and are not alarmed by it.  Be sure to communicate the plan in all the common local languages in each country.  Encourage employees to take the information home and share it with their families.

Get Involved Now!

HR staff plays a key role in creating and implementing a plan to respond to a pandemic.  In addition to helping draft the plan and organizing implementation of it, Global HR must also focus on:

  • Education – Develop plans to educate employees in the prevention and spread of contagious and potential pandemic diseases in the workplace – signs, training, providing hand sanitizing, etc.
  • Partnership with the Community – Work closely with local health departments and other officials to take advantage of their resources, and secure a role for your company in community prevention efforts.
  • Awareness – Make employees aware of the resources available to them for prevention and cure under the company’s health care plan or clinic, national health insurance, and other resources.
  • Policy Updates – Review and update sick leave policies to address a pandemic situation (for the employee and to take care of sick family members).

As you can see, there are many things to consider in developing a plan to address a global pandemic.  I hope this article provides you with a good start in developing a plan for your company.  Don’t forget that any global plan must be carefully prepared and reviewed by local or international counsel to avoid any liabilities for the company and risks for the employees.

Have you already developed a plan for responding to a pandemic?  Share your comments to enrich the information in this post!

More About Mariana

Mariana Villa da Costa

Mariana on LinkedIn

Email Mariana

Littler Mendelson

2 Comments

Posted in Benefits, General, Global HR Expertise, Insurance, International Benefits, International Employment Law

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Directory of Links for International HR

Posted on November 11, 2009 by | Comments Off on Directory of Links for International HR

heaps_warren1Author:
Warren Heaps – Birches Group LLC

For some time, we’ve had a Links page on the International HR Forum Blog, but it has been perpetually under construction.  Well, it’s now time to finish the construction, and make the Links page a valuable resource for international human resources practitioners.

This will be an ongoing effort to gather, vet and categorize potentially dozens or even hundreds of web sites.  To get things started, we would like to invite you, our readers, to tell us about your favorite online resources.  We’ll take care of sorting through all the suggestions, setting up logical categories and making the Links page a useful reference.

So please, send in your suggestions now!

Just type in the information in the box below, and click Submit.

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Posted in General, Global HR Expertise, International Expertise, Professional Development

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Leadership Development in Africa – Part I

Posted on October 27, 2009 by | 11 comments

Lex LindemannAuthors:
Lex Lindeman – HR Boosters and
Dr. Paul Rono – Kenyatta University (Nairobi)

In my last article, I highlighted the latest thinking in the area of western leadership development and the deployment of training programs in a corporate setting. In this short article, we will discuss some specific approaches to leadership development for public and private organizations in Sub-Saharan Africa.

I would like to welcome Dr. Paul Rono as my co-author.  With Paul’s experience as a university lecturer and my experience as leadership developer for numerous private and public companies in Africa, we think we can give the reader a good ‘blend’ of effective leadership development for African managers.

Natural Leaders?
The leadership and philosophies of African political leaders have affected institutions and companies in various African countries for many years.  For example, charismatic leaders were believed to be those who have the natural capacity and personality traits or qualities to lead.  Hence, leaders were said to be born or natural “great men.”   Traditionally, leadership was said to be an attribute of personality.  Born or charismatic leaders become real leaders because they have such personality qualities but also: ambition, patience, pride, humility, wisdom, friendliness, dependability, force, endurance and, of course, managerial competencies.

Modern Functional Leadership is essentially to facilitate the interaction within a group to achieve preset goals, to realize the organization’s strategic objectives.  Such functional managers or leaders are usually nominated, appointed and selected from among equals.  If people utilize proper and effective managerial tools and motivation, performance and effectiveness increase considerably.  Of course, this is also applicable to African managers and leaders acquiring or possessing modern functional leadership skills in a target achievement and ‘productive’ environment.

Successful Leadership Behaviour
The elements enumerated above are essential to successful leadership behaviour.  The successful leader is:

  • Sensitive to the feelings of others, helpful, responsive and friendly.
  • Loyal to his ideals and ideas and respectful of the beliefs, rights and dignity of others.
  • Strong in his/her feelings of self-confidence and ability to identify easily with co-workers and supervisors.
  • Enthusiastic when informing others about the introduction of a strategic program.
  • Takes interest in improving the group and get work done and avoid envy and jealousy.
  • Endeavours to give others the benefit of doubt and or advantages and firm but not proud or stubborn in making judgments and decisions. They are sincere and straightforward.
  • Embraces change in their departments and don’t avoid reasonable risk taking.
  • Manages individual performance and steer their subordinates on a regular basis.

Successful African Leaders Competencies
The modern African leader or manager should be more ‘democratic’ in his/her relations with subordinates and at the same time maintain the necessary authority and control in the organization or institution for which he/she is responsible.  The somewhat less modern African leaders rely on collective accountability.  Good (thus effective) leaders inspire people/staff to perform optimally if necessary individually or as a team.  The best African leaders, despite their many differences in personality, practice certain principles like delegation, creativeness, networking, individual accountability and decision-making.

What are Effective Leaders?

 

 

 

 

 

 

  • They take an interest in employees and communicate clearly and transparent.
  • They keep morale high. They encourage team spirit. They also give a feeling of being respected and being needed. They awaken enthusiasm and motivation.
  • They use commands sparingly. They avoid giving orders such as, “Do this!”, “Stop this,” or “Do it this way.” They request, not demand.
  • They show respect and faith to subordinates. They show the same consideration they would like to receive and show interest to others.
  • They welcome suggestions and prompt employees to think creatively. They avoid the phrase: “Yes but…” which generally is considered as a: “No!”
  • They handle grievances fairly. They act fairly. No favourites when assigning work. They are impartial.
  • They express approval. They show appreciation and complement, but they allow a certain level of mistakes made.
  • They create highly productive teams, delegate tasks wisely, and step aside.
  • They develop their people to enable them to prepare them to achieve more challenging goals.

 

 

Characteristics of Effective Leaders
The nature and style of functional (managerial) leadership greatly influence job satisfaction and motivation.  Effective leaders show consideration for employees and enable them to have a sense of participation in decisions that affect them and they will have the following characteristics:

  • Sensitivity to the individual problems people face on the job.
  • Availability and openness to people in need of help.
  • Sympathy with adverse conditions in the work environment.
  • The ability to establish more than a boss-worker relationship.
  • Above all delegate challenging tasks to their subordinates.

Highly productive leaders tend to spend more time than less productive managers to:

  • Motivate and inspire their employees and provide structure.
  • Keep employees informed.
  • Get ideas and suggestions on important matters before going ahead.
  • Try out new ideas with them.
  • Show consideration for their needs.
  • Coach their workers individually.
  • Develop and train employees for increased responsibilities.

Managers and Leadership Development
Most leaders want to be more effective in their leadership.  Some think they only need to learn techniques, others assume that they can learn a magic formula or foolproof method.  Effective functional leadership implies an intensive development process.  Some of the ability comes as a result of experience, some by learning from mistakes, by profiling from the experience and mistakes of others, from personal insights and by learning managerial skills.

To become truly effective African Managers and Leaders they will have to be developed through sustainable leadership competency programs that offer training with a difference.  (See “Trends in Leadership development” Part II).  These development efforts should be highly interactive, aimed at leadership and managerial competencies such as delegation and responsibilities acceptance.  These customized interventions are generally short (maximum 4 to 5 days) followed up and coached by their superiors, i.e. the participants should be given room to ‘experiment’ with their newly acquired skills.

In Summary
It is certain that African countries will grow and develop in the coming years; look at the example of the pace of growth of mobile phone networks and coverage.  Efficient infrastructures, systems and processes are put in place. However, just this is not enough; Inspiring Functional Leadership is an absolute necessity for growth.  Sustainable investment in the modern development of African managers and leaders is primordial.  In order to accelerate and maintain growth in Sub-Saharan Africa we must put in place the right learning work environment and formal, high-impact development possibilities.

In our next article, Paul and I will go deeper into specific competency development aspects such as the ability to delegate tasks, sense of responsibility and speeding up the execution of tasks, again related to African managers and leaders.

More About the Authors

More About Lex:

More About Paul:
Dr. Rono is a lecturer at Kenyatta University in Nairobi.  He is an authority on leadership development, and has published various articles related to leadership development in Africa with a progressive yet adoptable and realistic view.  Watch for his new website coming soon!

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Posted in Africa, General, Global HR Expertise, Leadership Development, Professional Development, Training

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Rethinking Incentives

Posted on September 15, 2009 by | 2 comments

heaps_warren1Author:
Warren Heaps – Birches Group LLC

This post is a bit different from the others that have been written for the Forum.  It’s designed to get you thinking, to entertain you, and to generate discussion.  While not strictly an international human resources topic, incentive pay is a global phenomenon of interest to our readers throughout the world.

There is much written about incentives and motivation.  Organizations spend countless hours fine-tuning their reward programs to optimize business results. Many theories exist to describe these optimal solutions.

But does incentive pay really work?

Recently, a client forwarded a link to a video on this subject, featuring Dan Pink, courtesy of TED: Ideas Worth Spreading . If you are curious  about the answer to this question, or in general, believe that incentive programs sometimes miss the bar, I highly recommend you listen to Dan’s speech.  It’s about 20 minutes long, and it will get you thinking, for sure.

After you watch the video, please add your comments to share with others.

2 Comments

Posted in Compensation, General, Global HR Expertise

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How Big Must Your Relocation Provider Really Be?

Posted on August 2, 2009 by | 10 comments

edit-Alan Biz Mug Shot 1The Forum recently received a great question via our “Ask the Expert” feature:

“We are a “young” international and domestic relocation management company but our staff has many collective years of experience in the industry. We are having a hard time breaking into the corporate market.  It seems that HR Departments do not want to give us the opportunity to present our services.  How can a small company like ours work itself into the international employee relocation market within a corporation?”

We can truly empathize with this situation, which is one we’ve often seen.  This is especially true in today’s economic environment of slashed budgets and significantly reduced transfer and assignment volume.  Overworked and highly stressed company staff are unlikely to spend precious time, now, to hear about services they’re not currently using.

The reader suggested that the “big” global relocation service firms receive a better reception from prospective clients than do the smaller and newly established firms.  In our experience, this is basically true.  The reader also stated that many of the smaller firms have a stronger service orientation and can be much more responsive and flexible than the big well-established providers.  Indeed, we have seen cases of this too.  It’s possible to demonstrate that smaller firms made up of seasoned experts, but with lower operating overhead and more flexible processes, can be quite cost competitive while providing high quality services as well.

So why are the small firms having difficulty “breaking in”?  What is it that the big firms offer as “competitive advantage”, often successfully, that the small firms do not?

Big firms have a large footprint.

They can point to wholly owned offices and affiliate relationships in a wide array of countries.  This can be a huge issue for corporations that want to have local touch points for their employees and direct knowledge of local environments readily available.  The small firms often don’t have such a geographic footprint and might not be sure how to establish one.

Big firms have globally experienced staff.

Frequently, their staff come from a variety of countries, have lived and worked in multiple countries and speak a number of languages.  They also frequently have individuals with prior international assignment policy development and program management experience on their teams.  This engenders great credibility in the eyes of the corporate buyer.

Big firms leverage their extensive experience.

 They have managed programs covering multitudes of assignees across a variety of countries and industries.  The corporate buyer is far more impressed with stories about “been there, done that” than with honest admissions of “haven’t been there, haven’t done that — yet”.  Corporations tend to be risk adverse and shy away from “being the guinea pig on whose dime the new service provider learns the business”.

Big firms have technology.

They offer sophisticated state-of-the-art, web-enabled capabilities for projecting total assignment costs, managing reimbursements, communicating with clients and their transferees, interacting online with data providers, providing country-specific information, and tracking and reporting expenses.  Many smaller firms do not have such (expensive) technology and, occasionally, cannot demonstrate expertise in managing the complex requirements of expense management and tracking across multiple countries and pay-points.

Big firms have strong relationships with key service providers.

They know and work with a variety of firms providing assignment cost of living and housing data, international tax experts, destination country employment counsel, cultural and language training firms, etc.  These pre-existing working relationships mean single point of contact and seamless service provision that is extremely attractive to corporate clients.

Big firms invest in polished marketing campaigns.

They advertise, host and sponsor conferences, deliver keynote presentations, conduct webinars, host booths at SHRM and ERC conferences, develop highly polished web sites, publish surveys and articles, etc.  This does not, of course, make the big firms better at providing services but, at the end of the day, polished marketing does impress prospective clients and creates name recognition.

Big firms have the advantage of name recognition.

 Finally, there is the cliché that no procurement professional was ever fired for hiring a well-known “big name” even if there was a service breakdown later. Let’s face it, in many corporations there is a built in bias toward hiring only name firms and avoiding the perceived risk (accurate or not) of hiring unknowns.

So what can a small/new firm do?

Emphasize responsiveness, service orientation and flexibility.

Probably the two most critical attributes in which to excel and compete are outstanding service and price.  Responsiveness, flexibility and competence are critical in what, I think we would all agree, is a service industry, after all.

Build internal international expertise.

This should be done via hiring highly experienced, preferably well-known, and globally networked staff and through education such as the SHRM GPHR and ERC GMS programs.  Travel and learn from first-hand experience about assignee destinations around the world.  External consultants also can be quite helpful in this area.

Invest in technology.

The ability to project and track costs, communicate with management, transferees and other services providers, e.g. the client’s international tax firm, and manage data is critically necessary.

Develop and nurture relationships with complimentary service providers.

This must include in-country providers and data, immigration, tax, language training and cultural training firms, among others.

Create name recognition through a well-focused and professional marketing campaign.

Demonstrate how the firm should be perceived as a trusted advisor and capable service provider. Create a public presence in the industry.

Delight your current clients and enlist them as your champions

When courting new business, make use of recommendations and testimonials from satisfied clients.  Ask your clients for leads and to make “warm” introductions.  Word-of-mouth recommendations are priceless.

Direct business development efforts towards smaller firms.

They tend not to have the budget for, and less of a bias toward, the big firms. It’s also relatively well known that the big firms don’t give their best attention to small accounts. Go where there IS business AND less competition.

Implement a “Blue Ocean” strategy.

There are many capable providers of  global mobility services, large and small.  The market, especially in the current economic scene, may actually be over-supplied with providers.  Competition is fierce.  We would suggest that small firms specifically target prospects whose mobility needs – geographically and transfer types – best match the firm’s geographic footprint and operational strengths.  Approach those firms that are not being approached by the multitudes of providers.

Seek out the advice and counsel of those with depth of experience and expertise.

We believe that seeking guidance and mentoring from experts can be quite worthwhile.  Professionals with prior “in-house” corporate experience, as buyers of external global mobility services, across a variety of industries are especially valuable.

We again thank the reader who submitted the question.  Now we invite our readers to share their views.  Please let use know your thoughts via comments on this post.

More about Alan:

On LinkedIn

Contact Alan

LOF Solutions

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Posted in Expatriates, General, Global HR Expertise, Global Mobility Services, International Expertise, Relocation

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Report to Our Readers – July, 2009

Posted on July 29, 2009 by | 2 comments

heaps_warren1Back in April of this year, we launched the International HR Forum Blog.  It was a bit of an experiment.  None of us were experienced bloggers.  Some of the authors knew each other and had worked together; some met for the first time virtually during our initial conference call.  But we were all very excited to try a bit of the latest technology to reach out to the broad HR community and share our expertise and passion for international human resources.

After just over three months, we could not be more pleased with the results!

The Forum is catching on!
The Forum has had over 12,000 page views since its inception.  We are averaging between 100 and 200 page views a day, and over 3,000 page views a month.  We are very pleased with these results.

We Are A Global Community
The most fascinating aspect of being involved with this blog has been the diverse community that participates.  You can see this for yourself – just check the different flags in the Feedjit box, or for a real treat, click on the box and look at a whole page of feed statistics.  Depending on the time of day, you will see an array of flags from every region in the world.  In the morning here on the east coast of the US, I notice the visitors from Europe, Africa and the Middle East.  During my evening hours, the Asia/Australia contingent is there.  And during the workday, many of my colleagues in the Americas check in.

It’s impossible to list all of the countries from which we’ve had visits – the posting would be too long.  But as I write this post, there have been visits from at least 15 different countries in the last several hours.  We’ve had visitors from developed countries in Western Europe, Canada, Australia, etc.  But equally, we have had excellent participation from developing markets such as Vietnam, Indonesia, Gabon, Nigeria, India, Brazil and more – even Mongolia!

It’s this diversity that makes the blog experience  so rewarding for us.  To know that we are reaching an audience from so many places, large and small, is more than we ever expected.

We Have Almost 125 Subscribers!
In the short time we’ve been writing, almost 125 people have subscribed to the blog, automatically receiving our posts via email or their RSS reader of choice.  This is especially gratifying to us, since it sends us a message, as authors, that you value our content, and want to be kept informed about it.

Our Connections
Many of you follow our content via postings through various LinkedIn Groups.  We have arranged with several of the group owners to automatically post our blogs as news articles in the groups.  Similarly, several other HR and non-HR related sites have picked up our feed for the benefit of their readers; we’ve listed these partners in the Other Resources section on the blog.  If you are a group owner or blogger and would like to feature our feed, just let us know.

Going Forward – Get Involved!
The experiment that has evolved into the International HR Forum is a success, and we are committed to continue blogging to provide you, our readers, with the most interesting and relevant content.  You can help us.

Blogging is just another type of communication, and it’s most rewarding when it’s two-way.  We invite you – encourage you – to make use of the comments feature on the blog.  Let us know what you think, if you agree or disagree, if you think our content is terrific, and how we can improve it.  Offer suggestions for topics, guest bloggers, great resources to share, etc.  The more active the community of readers becomes, the more useful the blog will become as well.

Help us spread the word – share the blog with your friends and colleagues. You can just tell them, or use the Share link to send them a link to one of our postings.

Thanks
Finally, on behalf of all of the authors, we would like to express a special thank you to each of our readers, for supporting this initiative.  Without you, we would not exist.  And because of you, we are thriving.

2 Comments

Posted in General, Global HR Expertise

Resourcing in Southern Africa

Posted on July 20, 2009 by | 1 comment

Imported Photos 00033Author:
Yendor Felgate – Emergence Consulting

Recessionary times have dramatically impacted the volume and level of resourcing opportunities available in Southern Africa.  Anecdotal evidence from resourcing companies we engage with or have trained over the last 6 months, suggest that in the first half of this year we have seen vacancy levels oscillate between 30 – 60% less vacancies.

The impact in Southern Africa has been uneven, with the obvious exceptions being Angola and Mozambique, where local environments and skills shortages continue to fuel resourcing opportunities.  The relatively small markets of Namibia, Zambia and Botswana have slowed, with a number of companies placing moratoriums on new or replacement hires. These markets are highly susceptible to any slowdown in the worldwide demand for commodities, even impacting governments, who tend to be the largest employers.

South Africa is by far the largest resourcing market in the region and has been similarly impacted.  The knock on of the slowdown in the region has led to increased Southern African applicants applying for South African jobs.  In turn South African companies increasingly look to apply job moratoriums in the work place, with an overt South African first policy. When speaking to companies, many are literally ‘holding on’, using natural attrition to right size their businesses.  Our sense is that this can only go so far, and that we will see a range of corporate restructuring in the South African market in the last of half of this year, despite the perceived upside of hosting the World Cup next year.  Such a dramatic market change has impacted applicants and recruitment companies alike.

Firstly this has slowed down the use of non-South Africans in the South African market, which is a big blow to encouraging Southern Africa as a region, to utilise skills co-operatively.  Our view is that companies and recruitment agencies continue to miss significant upside opportunities in the hiring of African talent, both in terms of pricing and value add.

Secondly, the South African recruitment market will go through a significant restructuring of the players offering recruitment services.  The larger companies will consolidate during this period, with some of the more adventurous ones looking to expand in the region.  Small to medium companies are under pressure, with some already closing.  In order to survive, these entities will increasingly need to come up with different customer propositions or products.

We see the market differentiating between low cost producers and the higher end players, who increasingly operate in a more consulting role, with a wider range of products or services.  This period will be very difficult for ‘traditional’ players, who want to simply ride out the storm, as margins will reduce in tandem with the recession.  This will be exacerbated by the trend of companies accessing candidate databases directly and using social networks in lieu of recruitment agencies.

The third impact will be an escalation of tension between stakeholders around what it means to employ people.  Governments will look to protect full time employment, whilst the market will intensify their search for labour flexibility.  This tension has already erupted in Namibia, with the recent banning of labour broking and the South African government is also looking to do the same.

This brings us back to the question of where next for commercial recruitment.  We have a two scenario view.  The first or low road suggests that recruitment becomes unattractive as a commercial venture with the banning of labour broking and the commoditisation of recruitment.

The second scenario is hardly a high road, but one that will benefit those recruitment companies that look to diversity their services and become low cost producers when mining their candidate IP.  This implies a significant change in current recruitment approaches, pricing and funding models.

In the short term, our sense is that a complex combination of the two is occurring currently.  None of the above in our mind necessarily benefits applicants and we think that recruitment professionalism will be increasingly under pressure.

More About Yendor:

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Posted in General, Global HR Expertise, Immigration, Leadership Development, Professional Development

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But . . . We Already Pay Competitive Wages!

Posted on July 16, 2009 by | 1 comment

Author:
Chuck Csizmar – CMC Compensation Group

What doesn’t happen when your company pays competitive wages?

You’ve read your company’s want ads and heard the pitch from your recruiters; you offer competitive wages to qualified candidates.  That’s got to be a strong hook for attracting talent, right?

Big deal.

You regularly update your country-specific pay structures based on market trends, so the opportunities you offer your employees should support your retention and motivation strategies, right?

Not enough.

Most employees presume that your company is already doing or aspiring to meet the goal of competitive pay.  After all, companies routinely advertise the practice (“we offer competitive wages”) and candidates in return expect this of potential employers.  But what happens when your goal of offering competitive pay is finally achieved?  Are employees pleased and content?  Can companies rest in their efforts to attract, motivate and retain?

I’m afraid not.

When in a situation where they’re not paying the “going rate”, management fervently hopes that employee challenges and criticisms will disappear once they reach that difficult-to-achieve target.  I say difficult because it’s not only an illusion but an expensive problem if you have a large body of underpaid employees.  And once you climb that mountain, well . . . so what?

What doesn’t happen when you offer competitive pay is that your recruitment problems have not magically disappeared, your employees won’t be satisfied and your compensation program has achieved nothing more than being average – and isn’t that a “C” grade in school?  Is that where you want to be?  Is that a practice that ensures your employees will be content to stay with you?  As far as aspirations go, it’s only middle-of-the-road.  You will find that it is not an advantage to pay the going rate, but it is definitely a disadvantage if you don’t.

Even if your company does pay “the going rate” or the norm or the competitive average (what the survey data shows), that means that approx. 50% of the companies out there are paying *more* than you.  That’s what average gets you, with half doing more and half doing less.  Is that what your company aspires to achieve?

Remember, no one leaves your company for less money – so all you’ll hear from your employees is about how so-and-so is making more money somewhere else.  And of course, employees only hear what supports their own notions – so they wouldn’t pay attention to the whole rewards package, just the specific components that confirm their opinion that your company isn’t paying enough.

The only way to avoid this scenario is if you become the premier paying company in your market / industry – and can you afford that cost?

Lest we forget, it is important to differentiate between having a salary structure (grades, salary ranges and midpoint) that provides competitive rate “opportunity” and actually paying employees at those rates.  Some may describe this as whether the company is “walking the talk”.  I recall a client who boasted that their salary range midpoints were continually adjusted to mirror market rates, but later was embarrassed to discover that their actual pay practices delivered pay levels well below their own published midpoints.  However, it did help explain the high turnover and low morale.

For their part, employees will relate to what they are being paid, not the midpoint of a salary range or other such declared “opportunity”.  To them the company’s supposed “competitiveness” is more illusion than fact; especially if they’re experienced and have been with you for awhile.  Thus the company needs to keep its focus on actual pay vs. opportunity pay.

Why do employers fail to pay the “going rate”?  Typically it is not a strategy, but a series of practices that have evolved over time.

  • For various reasons some candidates will accept a lower rate than should normally be paid for their knowledge and experience, and managers tend to view this as good news and a cost savings.  In fact it is more like putting a skeleton in the closet and hoping it doesn’t haunt you later on.  One day these same employees will change their minds.
  • Once you’ve started down the slippery slope of paying some employees below market rates the practice is soon compounded by the well-intentioned practice of internal equity.  Managers don’t want to pay similarly qualified new people more than existing employees, so the new hires are offered either below market pay or placed inappropriately in higher value jobs to get them more money (a different problem for another article).
  • Pay-for-performance systems have a hard time keeping up with the increased marketability of employees.  A minimally qualified employee hired at the minimum rate will gain knowledge and experience (and thus marketability) faster than a company’s annual merit system can recognize.  This is compounded when you have to hire a qualified worker and discover that the market requires you to pay more than what you’re paying your more experienced employees.

So, what’s the answer?  You likely won’t find management agreement to become the premier payer in your area, so you should consider instilling some flexibility into your pay practices.  You should consider targeting certain key jobs in your organization (highly skilled, difficult to replace, etc.) and make sure those jobholders are well paid for the market.

Other positions that are not as skilled and more easily replaceable you could continue with your “competitive opportunity” strategy.  Any losses would be more easily absorbed.  This approach is somewhat akin to ring-fencing your key talent, protecting them against poaching while recognizing / rewarding those with the most potential impact on your business.

So be careful when you proudly claim how your company provides competitive wages.  You may not be correct, and if so – big deal.

More About Chuck:

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Posted in Compensation, General, Global HR Expertise

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Accurately Measuring the Price of a New Location

Posted on July 14, 2009 by | Comments Off on Accurately Measuring the Price of a New Location

Photo Liz Perelstein (2)Author:
Liz Perelstein –  School Choice International

One of our clients identified a new emerging economy where operating their business would save considerable money.  In this new region property, local labor, and running the plant promised to cost only a fraction of the price of similar variables in their current location.  In order to get the new plant operating successfully, they needed to move 100 families for up to three years to train local employees on their processes and corporate culture.

About to embark upon a group move of the initial families, unanticipated costs surfaced.  The company had previously implemented a policy where it moved families as locals rather than as expats.  As a result, international schools were not budgeted for the current move.  This was a good decision in the previous location. However, in the new country, local residents use private schools whenever possible.  While local private schools may not be as expensive as international schools, they are still a significant expense for a move of 100 families.

Before moving into a new country, learn about the culture of schooling and the impact to your budget.

In some countries, public schools educate the “top” local talent – only students with “problems,” or those who are unlikely to succeed in the public sector attend private school. In others, public schools have poor records of educating students. They may even have chronic union problems, facilities issues, or other structural troubles that deplete the government run educational system on an ongoing basis.  In these areas, parents may use private schools when possible and send their children to public schools only if no alternatives are available.

To identify your educational costs for a group move, picking a location where state schools are viable for local middle class (and higher) residents is a good first step.  However, it is still important to ascertain whether these will be appropriate for non-native families.  Once you have determined the overall culture of public vs. private schooling in your proposed location, compare the school systems that your families are coming from with those they are going.  Are the curricula similar or will children have a hard time adjusting in the new location – as well as repatriating – if they do not attend home national schools?  And finally, are the schools familiar with overseas children so that the transition is reasonable?  Do they work with new families to ensure that the experience will be both academically and socially worthwhile?

If schools are aware, willing, and able, a local education in expatriate destinations can be immensely profitable for many children.  But if you do not ask the right questions before the move, you may find that you have grossly underestimated your costs, or otherwise find yourself with many failed assignments.

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Posted in Cross Cultural Insights, Expatriates, General

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How Can I Develop Global Human Resources Management Expertise?

Posted on June 25, 2009 by | 1 comment

Alan's Mug Shot

Author:
Alan Freeman – LOF International HR Solutions

We are frequently asked this question either by relatively new entrants to the HR profession or by purely domestic practitioners who have been assigned international responsibilities for the first time.  In the latter case, there often is an element of panic in that the individual’s management expects top-notch global HR capabilities “yesterday”!

Fortunately, there are a variety of ways to acquire global knowledge and capabilities. For example:

Formal Education 

We believe that to truly advance in a global HR career, both Bachelor’s and post-graduate degrees in business and Human Resources form a necessary foundation. The University of Minnesota, Cornell University, and the University of Illinois offer excellent HR programs. Thunderbird, INSEAD, Cranfield University and the University of Southern California (IBEAR) offer global MBA programs of note. There are many more.

Additionally, many Universities and professional organizations offer classes, sometimes through their “Extension” programs, in various areas of global HR. These can be well worth checking into.

On The Job Experience

There is nothing like hands-on experience. One should seek out positions involving global responsibilities and volunteer for international projects, work teams and task force activities whenever possible. They also should get involved with business leaders who have global responsibility and shadow them and assist however possible. If an opportunity to live and work abroad presents itself, go for it! No, do more than that. Strive to secure an international assignment!

Professional Organizations

Many professional organizations now offer extensive global activities and resources. Join them and participate in their global HR offerings! Some are open to any and all applicants; some are by invitation only and sometimes dedicated strictly to specific industries. One of the first-best avenues is to become a member of your country’s national HR Association, such as the Society for Human Resource Management (SHRM) in the US or the Deutsche Gesellschaft für Personalführung eV (DGFP) in Germany. These organizations, in turn, are members of the World Federation of Personnel Management Associations (WFPMA). Attend both your country’s association events and WFPMA conferences.

Professional Certification Programs

A number of professional organizations have established certifications such as the SHRM “Global Professional in Human Resources”, the World at Work “Global Remuneration Professional” and the ERC Worldwide “Global Mobility Specialist”. These can be quite useful and we’d encourage the reader to pursue certification.

Mentors

One can learn a great deal from a personal mentor. Some argue that mentorship is critical for success. Establish relationships with successful global business leaders, both within HR and in other disciplines, and ask them to be mentors. Heed their teachings and counsel. 

Conferences, Seminars and Webinars

There are many professional conferences and seminars available literally all over the world and they are often highly educational AND help one expand their professional network. Attend whenever possible!

A few examples include:

  • SHRM Global Conference
  • Big 4 tax firm conferences
  • Major consulting firm conferences
  • ERC Worldwide Global Workforce Symposiums – regional and global events
  • IBIS conferences and “institute”

Consulting Firms’ Reports and Data Products

A wide variety of useful information is available for purchase from major consulting houses. This is typically most useful for gaining knowledge relevant to practices in specific countries and regions. It is almost invariably quite expensive.

Professional Literature

A wealth of professional books, journals, magazines and newsletters are available and well worth the acquisition price and time to read. Much is available through the SHRM and World at Work bookstores, and from other outlets such as Amazon.com. A very short list of useful materials includes:

Periodicals & Newsletters

  • “Benefits and Compensation International”
  • “International HR Journal”
  • Baker & McKenzie “Global Employer”
  • Law firm newsletters, e.g. White & Case
  • Immigration firms’ newsletters

Some Useful Books

  • The Global Challenge, Evans, Pucik & Barsoux
  • Strategic International Human Resources Management, Perkins & Shortland
  • International Human Resource Management, Briscoe & Schuler
  • Managing a Global Workforce, Vance & Paik
  • International Human Resources Guide, Roger Herod, ed.
  • International Human Resource Management, Dowling & Welch
  • Readings and Cases in International Human Resource Management, Mendenhall & Oddou

The Web

Finally, how could we not mention what’s available on the Internet? My first comment is “caveat emptor”!  Some of the information available on the web can be quite accurate and useful, some not so much. One must be very careful in taking the source into consideration and evaluating the quality of the input obtained. The ability to make such evaluations, of course, takes us back to working through the list above.

Wrap Up

As with any blog commentary, we’ve only begun to scratch the surface on the possibilities. We invite all readers to share their comments and suggestions as well.   Let’s hear from you!

Thank you

About Alan

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Posted in General, Global HR Expertise, Professional Development

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