This is the first of a three part article contributed by He Shu Han.
“What happens if we invest in developing our people, and then they leave us?” the CFO directs this question to the CEO.
“What happens if we don’t, and they stay?” reciprocated the CEO.
This is a stirringly contrasting clash of a fundamental management philosophy that affects all forms of organizations, private and public. In Singapore, this is not exception. Until the day where all activities are fully operated by automatons, the human workforce is, and always will be, the primary driving asset of growth. From a small company to a whole nationwide doctrine, this basic management philosophy will have a wide and rippling effect on all things economical, and perhaps, non-economic as well.
Why did such perspectives develop, can we reconcile the differences, achieve a win-win, and achieve optimal optimization?
Rapid economic development in the last few decades in Singapore, coupled with varying factors including, but not limited to – global workforce management cultural trends (such as foreign blitzkrieg business doctrines), workforce cultural characteristics (such as individual loyalty values), workforce capabilities (such as level of education empowering career path possibilities) as well as workforce mobility (such as globalization), has magnified the two opposing camps.
The CFO’s view is colloquially termed “Hire & Fire”, whilst the CEO’s view is termed “Train & Retain”. A personal observation is that “Hire & Fire” is popularized in Singapore when the foreign cultural management winds blows from foreign MNCs, in particular USA and European centric ones. This “invasion” of management style is grindingly but successfully overshadowing the Asian method of being a people developer, which is seen as traditional and at the extreme bias, completely ineffective. For brevity of this article we shall term the former Management 1 (M1), and the latter Management 2 (M2).
Let us consider a few characteristics differences.
M1 sees the workforce as purely tools – cogs and wheels in a system that means nothing more than a simple employer-employee relationship based upon pure economical relationships. Like any nuts and bolts, no one is irreplaceable, and if worn out, should ruthlessly be replaced without any concerns, as long as it is legally acceptable to a minimum standard that is. In an organization that blindly follows dogmatic, mechanical systems based on ISO9001, Six Sigma, TQM and many more, every individual has a specific role to play. The system as a whole is more important than the individuals. Workers are seen to be non-loyal and mercenary nomads, guided by Adam Smith’s “Invisible Hands”, whose intention is purely economical and will move on to greener pastures the moment they can, frequently leveraging on their previous company as a stepping stone to upgrading their pay statuses.
It is believed that there is no point investing unnecessarily in the workforce as they will not stay for long and a ready, matured job market ensures an almost endless supply of eager, highly qualified workers that can easily replace any positional vacuum. From a cost and benefit perspective, this is a more practical approach since investment in workforce abilities takes time and resources, and if one is not up to it, simply getting an eager replacement worker is, ironically – Cheaper, better, faster. Although, I believe this is not what NTUC meant originally from a productivity perspective.
Since the workers are purely tools of symbiotic economic relationships where any temporary friendship is based largely on money – An interesting phenomenon is that the employer will pay and invest just enough so that employee do not go away unnecessarily, while the employee will work and develop himself just enough so that the employer will not fire them. And since they are just tools, why sharpen and maintain them when one could just obtain a new one when the old gets blunt?
Obviously, the employees are intelligent enough to also realize in this kind of environment that the company has little incentive to invest in them and will reciprocate the relationship, giving rise to a vicious circle. This is most commonly found in the investment banking sector in Singapore, where personal banker friends have quoted “The best way to get a pay rise is to jump from one bank to another, preferably from a local bank to a foreign bank”.
Now let us illustrate M2, and how to we achieve a win-win from here forth.
[End of Part 1]
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