China Update Hr News for Your Organization

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December 2006

CHINA UPDATE: HR NEWS FOR YOUR ORGANIZATION

MEASURING COMMUNICATION:IT WORKS!

When companies focus on measur-ing the effectiveness of their com-munication programs, they aremore likely to act on the results andmake useful changes that improvethe exchange of information withemployees.

P. 1

WORKFORCE EFFECTIVE-NESS — ENGAGING EMPLOY-EES TO DRIVE BUSINESSPERFORMANCE

Understand what can affect theworkforce behavior and what drivesyour employees.

P. 5

SHOULD WE KEEP THOSE PEO-PLE WHO DELIVER THE NUM-BERS BUT CANNOT WORKWITH OTHERS?

Towers Perrin case study.

P. 8

ARE WORK/LIFE BALANCE EF-FORTS GAINING MOMENTUM?

The latest Hong Kong HR CouncilPulse Survey has found that com-panies are introducing a variety ofwork/life balance initiatives as ameans of retaining employees intheir workforce.

P. 10

MEASURING COMMUNICATION: IT WORKS!

It’s often said by HR professionalsthat what gets measured getsmanaged. Now there’s fresh evi-dence that when companies focuson measuring the effectiveness oftheir communication programs,they are more likely to act on theresults and make useful changesthat improve the exchange of in-formation with employees.

This is one of the major findingsfrom this year’s ongoing collabora-tion by Towers Perrin and 16 otherlarge employers to assess howwell they are communicating withemployees and to identify areaswhere they can do better. The find-ings from the 2006 CommunicationEffectiveness Consortium, whichwere unveiled to participating com-panies at a meeting in June in SanFrancisco, come from a survey thatmember companies administer totheir employees each year. The2006 sample of roughly 15,000employees represents a combinedworkforce of more than 400,000 ina cross-section of industries from avariety of countries around theworld.

Overall, the consortium’s findings

suggest that employers that focuson specific elements of their overallapproach to internal communica-tion continue to see gains in per-ceived effectiveness. They aremaking steady gains in applyingthe tools of communication, suchas town hall meetings, e-mail andprinted material, to reach out toemployees with useful and timelyinformation.

But even more importantly, theyare doing a better job talking toemployees about the marketplaceand other aspects of the businessthat, according to other TowersPerrin research, are critical when itcomes to making an organization’sworkforce more effective.

GOOD GRADES ON THE BA-SICS

In terms of the fundamentals -- no-tably the quality and effectivenessof communication throughout theorganization -- employers drewrelatively high scores from employ-ees. They got favorable ratings,most of them higher than in 2005,in the perceived quality of:

printed material from the com-pany (81%),

company e-mail announce-ments (79%),

company intranet content(79%),

business unit e-mail an-nouncements (74%),

one-on-one supervisor discus-sions (74%),

printed business unit newslet-ters (72%).

China Update Online

For recent issues of China Update and other Towers Perrin publications,visit www.towersperrin.com.

IN THIS ISSUE



December 2006 Towers Perrin China Update I 2

Issue 9

Member companies also saw that,in most instances, they are usingthe channels of communicationmost favored by employees for re-ceiving various types of informa-tion. For example, e-mail is thepreferred (and most commonlyused) tool for discussing companystrategy and performance, whileone-on-one conversations with su-pervisors are the favorite choice ofemployees for learning about whatrole they can play in helping thecompany reach its goals.

Consortium members also sawmeaningful progress in two otherkey categories: improving leader-ship communication and increasingthe effectiveness of supervisorycommunication. Consistent withthis progress is the upward trend inthe consortium’s overall effective-ness benchmark, which climbedfrom 69 (out of 100) to 72. Whilethere clearly remains room for im-provement, the positive trend since2004 (when the consortium wasfirst launched) again makes thepoint -- effective measurement in-creases the likelihood of improve-ment. Companies clearly stakedout specific areas where theywanted to do better, and the resultsshow that they accomplished theirgoals.

MARKETPLACE AWARENESS

What’s more interesting is howcompanies are making progress onthe issue of marketplace under-standing. In both 2004 and 2005,this issue -- the extent to whichemployees fully appreciate who thebusiness views as customers andcompetitors -- emerged as a cen-tral concern for many respondents.Essentially, employees were say-ing that they were not gettingenough information about theircustomers and their competitors,and how their organization’s prod-ucts and services are perceived.

Gratifyingly, after a year in which anumber of the member companiesfocused specifically on this issue --providing new communication ve-hicles for delivering relevant infor-mation and stressing theimportance of this element in allcommunications -- the 2006 resultsshow marked gains. (Exhibit 1)

SOME PROGRESS WITH SU-PERVISORS

When it comes to supervisors --perhaps the most critical and yetalso most complex piece of thecommunication puzzle -- scores ontheir effectiveness in communica-tion remain fairly steady (and not

excellent). The most challengingareas continue to relate to takingthe time to explain developmentsand clarifying the business ration-ale for change. Exhibit 2 shows re-sults for 2006 as compared to2005. (Exhibit 2, page 3)

In this context, it is perhaps notsurprising that the most powerfulthings supervisors can do to en-hance how they are perceived ascommunicators relate to the way inwhich they deliver messages. Morespecifically, employees identifiedthe following areas as those thatmost influence their opinions aboutthe effectiveness of their supervi-sor’s communication:

My direct supervisor providesme with frequent feedback.

I have high-quality, one-on-onesessions with my direct super-visor.

I receive the specific informa-tion necessary to do my jobwell.

I agree with my business unit’sstrategy and vision.

Senior leadership demon-strates a sincere interest inemployee well-being.

Question Description2006Score

2005Score

Change

Effectiveness: Information on customers(e.g. satisfaction with products/services)

51% 39% +12

Quantity: Information on customers (e.g., satis-faction with products/services) is about right

(vs. too much or too little)

59% 53% +6

Effectiveness: Information on competitors 40% 26% +14

Quantity: Information on competitors 46% 39% +7

Exhibit 1: Selected Areas of Improvement in Conveying Marketplace Information to Employees




Issue 9

CHANGING DRIVERS OF OPIN-ION

This year’s study also offers inter-esting findings when it comes tothe specific factors that are mostimportant in influencing employee

attitudes and, ultimately, the effec-tiveness of an organization’s over-all communication effort. Of note isthe fact that these drivers havechanged significantly since the laststudy in 2005. Exhibit 3 illustratesthe contrast.

While the importance of effectivecommunication of strategy and vi-sion still applies, there is more fo-cus in 2006 on consistency,tailoring messages to the local

level and equipping supervisors to

communicate effectively. By con-trast, in 2005, employers focusedon the quality of information, deliv-ery mechanisms and other issuesgenerally in the realm of improve-ments to the actual tools of com-munication.

The message here appears to bethat as employers improve in someof the basics in terms of communi-cation tools, employees then beginto focus on the next level of effec-tiveness, including customization,credibility and accessibility. Mem-ber companies receive a customanalysis of what drives these per-ceptions in their specific environ-ment, providing a compelling roadmap for making ongoing changes

and improvements.

ROOM FOR IMPROVEMENT

Despite the broad-based improve-ments identified in this year’s sur-vey, there are a number of areaswhere consortium members stillsee relatively low scores. In fact,

using a cutoff of 60% favorable (ie,only 60% or fewer respondents arepositive), we do see some of theclassic challenges emerge:

59% say their company is openand honest in communicationto employees.

58% feel they are informed ona timely basis about major de-cisions.

What shapes opinion in 2006? Versus what we saw in 2005

Send consistent message about thedirections of the company

E-mail from the company and/or seniorleadership is high-quality

Tailor messages to local levelInformation is available about the com-pany’s core values

Make company performance mes-sages credible

Communications about the companystrategy and vision is effective

Ensure supervisors effectively solicitinput

Live presentations (or “town hall” meet-ings) from company/ senior leadershipare high-quality

Effectively communicate the com-pany strategy and vision

Group meetings you attend in person arehigh-quality

Exhibit 2: Employee Assessments of Their Supervisors’ Communication Practices

Exhibit 3: Changing Drivers of Communication Effectiveness




Issue 9

56% say messages are effec-tively tailored to the local level.

54% say senior managementboth talks and listens.

52% feel employees can voicetheir opinions without fear ofretribution.

52% say senior managementdemonstrates a sincere inter-est in employees.

In addition, communication aboutboth career opportunities andlearning and development (regard-ing understanding, agreement andquantity) all receive scores belowthe 60% threshold. These findingsare especially noteworthy in thelight of Towers Perrin’s recentGlobal Workforce Study.

COMMUNICATION AND EM-PLOYEE ENGAGEMENT

One of the key findings of theGlobal Workforce Study was thatChinese managers need to lever-age their power to influence work-ers’ attitudes, particularly byhelping employees to understandtheir role in achieving organiza-tional goals and performance, andby consulting with employees be-fore making decisions that will af-fect them. Less than half (around40%) of employees in Chinesecompanies rated their leaders fa-vorably on their interest in em-ployee well-being, their visibilityand accessibility, awareness ofday-to-day issues, and opennessand honesty in communicating withemployees.

These communication factors are

among the most important driversof employees’ intention to remainwith the employer, and of em-

ployee engagement. The GlobalWorkforce Study highlighted thepace of change in China, and thedanger that employees can feel asense of dislocation and anxiety,even in a growth economy. Thismay be why engagement levels inChinese companies, averaging just8%, are below the global average(which is also very poor) of 14%.

The study found that, apart fromfairness in pay, the factors thatdrive engagement in Chinesecompanies relate primarily to thework environment, and they de-pend on effective communication.Managers must communicateclearly and demonstrate consis-tency between their words and ac-tions across a number of areas:

provision of opportunities tolearn new skills,

collaboration across businessunits,

employee input into decisionsthat affect them,

company focus on customersatisfaction,

recognition and appreciation ofemployees’ good work,

management of work/life bal-ance.

The Global Workforce Study alsofound that highly engaged employ-ees are much more likely to believethey can -- and do -- impact cost,quality and customer views. Bydefinition, these are people whoare willing to “go the extra mile”and contribute discretionary effort

in doing their jobs. By conveyingmore marketplace information toemployees, employers not only

make their communication pro-grams more effective, they alsocan contribute to higher employeeengagement levels throughout theorganization and hopefully in-crease the number of people whoare highly engaged. This in turncan improve business perform-ance.

RESOURCES TO ENHANCEPERFORMANCE

Organizations belonging to TowersPerrin’s Communication Effective-ness Consortium receive special-ized reports that enable them tocompare their results to those ofother members and with their re-sults in previous years. Most mem-bers use the feedback to helpshape future communicationstrategies and programs, andmany have used the information todevelop entirely new programs.

Further information:

Hong Kong – Michael Chan Tel: +852 2593-4588 [email protected]

China – Grace Gong Tel: +86 10 5821-6018

[email protected]




Issue 9

lows companies to ac-curately predict theeconomic value result-ing from this workforceinvestment.

This allows every or-ganization to analyzeinvestments in theworkforce in exactly thesame way they viewother investments. So isthis the holy grail ofHR? Perhaps. But whyhas it taken companiesso long to figure outwhat might be regardedas a fairly intuitivemodel? The key is aninteresting conceptcalled engagement.(Exhibit 2)

ENGAGEMENT — THE MISS-ING INGREDIENT

For decades, companies havestruggled with how to truly meas-ure the critical variable that willallow them to understand howand where they should invest toimprove the performance of theworkforce. Companies thought foryears that happier employeeswould be more productive. Yetthe resulting use of measures ofemployee satisfaction did not pro-duce the intended results becausecompanies soon discovered thatan employee’s satisfaction hadnothing to do with their productivityor willingness to unleash discre-tionary effort. Companies thenmoved on to measures of em-ployee commitment that allowedthem to understand the emotionalconnection employees had withtheir organizations — and their

propensity to leave the organiza

tion. Still, this did not sufficiently

explain how workforce behaviorand decision making are shaped.

Enter engagement. Engagement isthe only metric that measures aworkforce’s capability and willing-ness to help a company succeed(see Exhibit 3 for a definition of theemotional and rational aspects ofengagement).

UNDERSTAND WHAT CAN AF-

FECT THE WORKFORCE BE-HAVIOR AND WHAT DRIVESYOUR EMPLOYEES

While measures of the workforceare not new in Asia, the concept ofengagement is. Our recent GlobalWorkforce Study broke new groundin helping companies around theworld understand the drivers of en-gagement, attraction and retentionglobally, with some interesting find-ings for a number of Asia’s key

economies. The chart below detailsthe drivers of engagement for

Measuring Satisfaction(“Am I happy?”)

Employee views on a

range of personalsatisfaction issuesfocusing on specificrewards, managementand workplace factors

Focus

Value

Measuring Impact(“Am I engaged?”)

Employee views on the

factors that drive rationaland emotionalengagement, i.e., thedesire and capability tohelp the organizationsucceed

Measuring Commitment(“Am I connected?”)

Employee views on whatcreates individual energyand connection to theorganization based onbroader factors in thework environment

A “nice to know”

indicator of generalwell-being that canhelp address discretedeficiencies

A more robust

blueprint forunderstanding howthe workexperience buildsemotional connectionand drives retention

The most strategicand behaviorally-based way to assessand predict thedrivers of value forboth the individualand the organization

The Evolution of Workforce Research…Exhibit 2

Exhibit 3




Issue 9

China, India, Japan and SouthKorea, and compares them withthe drivers of engagement glob-ally. (Exhibit 4)

SOME INTERESTING FINDINGS:

a) Consistent with what we haveseen around the world, im-proving employees’ skills andcapabilities is one of the mostcritical factors in engagingthem. This phenomenon istrue in both mature econo-mies like the U.S. and emerg-ing economies like China andIndia.

b) Interestingly, employees inChina, India and South Korearank collaboration with col-leagues as a critical driver ofengagement while employeesin Japan place greater impor-tance on input into decisionmaking.

c) Employees in both Chinaand Japan place significantemphasis on how seniormanagement behaves andmakes decisions.

d) Perhaps most intriguing, itappears that it is only the In-

dian workforce that placesheavy emphasis on opportu-nities to learn and develop.

BACK TO OUR LINKAGEMODEL

So what does all this data meanin terms of how we can manageand optimize our investments inthe workforce?

Leveraging this data within the con-text of the linkage model wouldsuggest a differential level of in-vestment in the relational rewards oflearning and development and work

environment (ie, investments in im-proving employee skills, workforcecollaboration, etc.) as opposed tothe more transactional rewards ofpay and benefits. Building on theconcept of engagement, the linkagemodel significantly enhances the

“tangibility” associated with measur-ing the return from investments inthe workforce, placing them on apar with the previously regardedmore tangible investments like

technology, fixed capital, etc.

As illustrated by our analysis of thedata from the 2003 version of theaforementioned study, there arestrong and positive relationshipsbetween engagement and revenue

Operating Margin with5%, 10%, 15% Change in Engagement

% Change in Employee Engagement

Current

6.0%

5%

7.5%

10%

9.0%

15%

10.5%

For a $17B company,that’s $250M

10%

14%

18%

22%

26%

30%

LOW HIGHEngagement Index Score

Revenue Growth

Engagement Index Score62%

64%

66%

68%

70%

72%

74%

LOW HIGH

Cost

Customer Satisfaction

1

2

3

4

5

Engagement Index ScoreLOW HIGH

28Appropriate decision-making authority

4Appealing culture

4Manager inspires enthusiasm

5Organization maintains staffing levels

29Sr management acts for long-term success93Reputation as good employer

1

5

6

4

7

2

Global

9

6

7

1

3

Japan

5People work as team

739Opportunities to learn and develop

6

5

4

3

2

1

China

7

4

6

2

1

India

Focus on customer satisfaction

5Salary criteria fair, consistent

6Input into decision making

3Good collaboration

Sr management acts consistent with values

1Improved skills, capabilities last year

S. KoreaEngagement Drivers

28Appropriate decision-making authority

4Appealing culture

4Manager inspires enthusiasm

5Organization maintains staffing levels

29Sr management acts for long-term success93Reputation as good employer

1

5

6

4

7

2

Global

9

6

7

1

3

Japan

5People work as team

739Opportunities to learn and develop

6

5

4

3

2

1

China

7

4

6

2

1

India

Focus on customer satisfaction

5Salary criteria fair, consistent

6Input into decision making

3Good collaboration

Sr management acts consistent with values

1Improved skills, capabilities last year

S. KoreaEngagement Drivers

Exhibit 4

Exhibit 5 Exhibit 6




Issue 9

growth, cost reduction and cus-tomer satisfaction. In fact, a fiveper cent increase in engagementcan result in a $250m increase inprofits for a $17b company. Mostorganizations would be hardpressed to find alternative invest-ments that delivered returns of thatmagnitude! (Page 7, Exhibit 5&6)

CONCLUSION

Investing in the workforce need notbe a leap of faith or a necessaryevil. With a linkage model as de-scribed here and a real under-standing of the drivers ofengagement, companies can un-derstand where, how and howmuch to invest in the factors thatwill shape employee behavior anddecision making.

And when investments like theseare made, then no longer will anorganization’s value chain be com-promised by a workforce viewed asthe “weakest link.”

This article was written by Ravin Je-suthasan, Practice Leader, Rewardsand Performance Management Manag-ing Principal at Towers Perrin and firstpublished by iHRM, Hong Kong on Oc-tober 2006, and modified in China Up-

date.


Hong Kong – Michael Chan Tel: +852 2593-4588 [email protected]

China – Grace Gong Tel: +86 10 5821-6018 [email protected]

SHOULD WE KEEP THOSEPEOPLE WHO DELIVER THENUMBERS BUT CANNOTWORK WITH OTHERS?

The Principal Consultant of Tow-ers Perrin, Michael Chan believesachieving the quantifiable targetsis good only for the short term.

Organizations’ long term successdepends on leaders and peoplewho are good team players andcan influence and impact othersto deliver positive results.

A real case in Asia:

A newly on-board HR Director(Mike) is being asked by his bosson his first day in the job: “My Re-gional Sales Director, Jeremy, hasagain exceeded his target this year

but he is having great difficultyworking with others”, said Bob, thePresident.

In fact, Jeremy has exceeded histargets for four consecutive years.However, none of his colleagues inthe regional team can work withhim and, similarly, the Sales andMarketing functional counterparts inthe HQ are having tremendousproblems coordinating, co-operating, liaising and working with

Jeremy. Moreover, his sales teamturnover has been averaging over75% annually for the last fouryears.

Also, because Bob has not ad-dressed the issue of Jeremy’s indi-vidualism, many of the colleaguesfelt that in order to be successful inthe company, one had to achievethe quantifiable targets by anymeans, even if one’s actions con-flicted with the Organization Cul-

ture.

Mike then analyzed the situation anddiscussed it with Bob. Though Jeremyhas exceeded all his sales targets, hehas, at the same time, created manyissues/problems and in the long termthese have added costs to the com-pany, both tangibly and intangibly.

In this situation, some of the better col-leagues have left the company be-cause they lost faith in themanagement. The turnover of Jer-emy’s sales team is costing the com-pany hundreds of thousands of dollars(the lost of experience, expertise,training, recruitment, managementtime, etc). In the market, the companyis suffering in terms of its reputation,and potential candidates refuse tocome for interviews once they knowthey might be working for or with Jer-emy. This has resulted in the companyhaving to pay a high premium to at-tract talent.

The above situation is a real case. Un-fortunately there are many similarcases existing in many organizationsaround the world, as well as in Chinafor local, JVs and multinational com-panies.

The question being asked frequentlyis, how should we deal with thesesituations? Should we terminate thedifficult individuals? Should we providemanagement training for them? Wouldindividual coaching work? Etc, etc….

In this era of fierce competition andlimited/tight resources, quantifiable re-sults are important for all companies inthe short term. However, it has beendemonstrated repeatedly in researchstudies that managers and leaderswould be better measured with moreemphasis on ”how” they accomplishtheir objectives because this is most

critical for the companies in the longrun.




Issue 9

Therefore you find that in the moresuccessful companies, the Perform-ance Management Systems actuallyincorporate the measurement of be-haviors and managerial competencies.Having a balanced Performance Man-agement approach is critical in that wemust measure both the “what” and“how” of performance -- this will en-sure our business leaders will balancethe short and long term perspective,and ensure the long-term success ofthe organization.

So, where do we start? The intro-duction of Competency Models(both Technical / Functional andBehavioral / Managerial competen-cies) greatly improves the organi-zation’s chances of success. Agood model will be able to clearlydefine what kind of people we wantfor the organization. It shouldclearly differentiate different levelsand functional competencies withprecise behavioral indicators. Cor-rectly developed, CompetencyModels will be the foundation of allthe Human Resources applicationsincluding Recruitment/Staffing,Reward, Training/Development,Talent and Management Develop-ment, Organization Developmentand Succession Planning, and fi-nally, Performance Management.

Interestingly, we always hear or-ganization leaders saying that theyhave retention issues. The fact ofthe matter is that “retention” is onlya result. It all started with the firststep, i.e. when companies recruitand/or select their talent. Whenmany HR and line managers areasked, “Do you know what youwant?”, most of them quickly an-swer that they want the “best” butwhat they meant is “technically

best” and possibly “smart”. They donot focus on the behavioral compe-tencies of the candidates. Years of

research studies have shown thatindividuals’ behavioral competen-cies are far more critical for theirsuccess in different roles in organi-zations than their technical capa-bilities.

Many psychologists have con-ducted research and discoveredthat individual characteristics, val-ues, traits, motives, etc affect anemployee’s working style. If theperson is in a leadership or man-agement position, their individualstyle directly impacts on their co-workers, sub-ordinates, and eventheir bosses, substantially. Thesecharacteristics will impact the pro-ductivity of their team and in turnaffect the bottom line of the busi-ness.

Many companies ask whether wecan train and develop these “poorpeople oriented” manag-ers/leaders. Again, repeated re-search studies have found that theeffort to train, develop or changeindividuals’ behaviors is very costlyand results are limited. Fundamen-tally, individuals’ characteristics,values, traits, motives are formedand developed long ago, possiblyin our childhood or “in-born” andthese are very difficult to change orimprove.

So, the answer would be that wemust find the “right” people in thefirst place, not the “best” becausethe “best” might not be the “right”,however, the “right” will always bethe best.

The steps to recruiting the “right”people should start with definingwhat we want. Then, utilize consis-tent, objective, scientific method-

ologies to find people who fit thatbrief. The methods would includeSimulation testing, Role Plays,

Structured Interviews, Psychomet-ric testing to determine the candi-dates’ character, values, traits,motives, styles, etc. Organizationsthat are successful using theabovementioned methodologiesreport tremendous “Return on In-vestments” for the resources spent.

Finally, we must not forget our ex-isting talent; we should utilize thedifferent tools to assess their cur-rent levels of competency and de-termine the gaps and opportunitiesfor development. Then, follow upwith properly designed and struc-tured managerial developmentprograms to coach and guide themto unleash their potential to be-come great managers/leaders.

CONCLUSION

In conclusion, “making the num-bers” may deliver short term wins,but to sustain long-term success,organizations should focus on theBehavioral / Managerial competen-cies of their talent. If you find thatyou cannot coach and developthose “Poor People Oriented” em-ployee, I would strongly recom-mend that you replace themquickly.

This article was written by MichaelChan, Principal consultant at TowersPerrin and first published by 21st Cen-tury Business Herald, Hong Kong onOctober 2006, and modified in ChinaUpdate.


Hong Kong/China – Michael Chan Tel: +852 2593-4588 [email protected]




Issue 9

ARE WORK/LIFE BALANCE EFFORTS GAINING MOMENTUM? The latest Hong Kong HR Coun-cil Pulse Survey has found thatcompanies are introducing a va-riety of work/life balance initia-tives as a means of retainingemployees in their workforce.

Work/life balance means many dif-ferent things to different people.The term was coined in responseto the increasingly stressful natureof corporate life, mainly as a resultof the cost-cutting strategies em-ployed by companies, ie leanerworkforces with added responsibili-ties for workers.

As a result, employees spend moretime at work than ever, especiallyin the developed economies. HongKong can probably be considereda “leader” in this area, along withJapan and Korea.

What are the leading employers inHong Kong doing to address theissue of work/life balance? ThePulse Survey looked at several ar-eas related to work/life balance:

Employee benefits such asleave

Benefits aimed at health andwell-being

Education programs and extra-curricular activities

Flexible working arrangements.

LEAVE ENTITLEMENTS

Most companies offer the statutoryamount of maternity leave – 10

weeks. Only 3% of companies offermore. However, almost half of thecompanies surveyed pay this leave

at 100% of salary rather than therequired minimum of 80%.

Marriage leave is also prevalent,with nearly 70% of companies offer-ing this form of leave, with an aver-age period of 4.6 days. Another10% of companies are consideringoffering marriage leave to their em-ployees.

Compassionate leave is offered byalmost all companies, with an aver-age period of 3.4 days.

Paternity leave is less common,with 25% of companies offering anaverage of 2.7 days’ leave. Another10% of companies are consideringoffering this form of leave.

Child care leave is not offered byany companies in the survey. Incontrast, companies in Singaporeare required by law to offer childcare leave for non-exempt employ-ees. A small number of Hong Kongcompanies arrange child care facili-ties for their employees’ children,and subsidise 50% of the cost. (Ex-hibit 1, page 11)

SUPPORT FOR EMPLOYEES’STUDY

Another aspect of work/life balanceis supporting employees who areengaged in work-related study. Thestudy found that 45% of companiesprovide paid leave for employees toattend examinations, and another8% plan to offer this benefit. An av-erage of 3.5 days per year is of-fered.

Study leave is not so common, withonly 10% of companies havingsuch a policy. The benefit, where itis offered, is generous – an aver-age of 7.5 days per year.

Sabbatical leave for study purposesis another benefit that is uncommon,with only 6% of companies providingfor this. An average of 48 days isavailable to these employees. Asmall number of companies is con-sidering making such leave avail-able.

Unpaid leave, which can be used byemployees for a variety of purposesand can be valuable in supportingtheir family and personal commit-ments, is offered by 84% of compa-nies. The average number of daysprovided is 42.

Financial support for external educa-tion programs is widespread, withover 90% of companies either sub-sidizing or reimbursing study ex-penses. Courses have to be job-related.

PERSONAL WELFARE

The concept of work/life balance isthat employers consider all the fac-tors that affect employees’ ability tomaintain their personal well-being sothat they can perform well in theirwork over the long term. The needsof every employee are different, andone of the initiatives that employerscan take is to allow employees totailor their own benefits.

Many companies in the USA offer arange of benefits and allow the em-

ployee to select the benefits that arerelevant to them – cafeteria plans.Some countries in Asia, such as




Issue 9

Singapore and Malaysia, havemoved towards greater flexibility in

benefits. The survey showedevidence that some Hong Kongcompanies are moving in the samedirection.

Just over 20% of companies pro-vide some form of choice of bene-fits, and another 7% areconsidering this option. The typesof choice offered include:

voluntary upgrade of medical,dental and health screen bene-

fits,

voluntary flu vaccinations,

variation in contributions to thepension program,

favorable rates on purchaseddental plans,

choice of health, dental or eyecheck at a subsidised rate.

PREVENTATIVE MEDICINE

As employees are spending morehours at work, the need to pay at-tention to their overall health in-creases. There is a wide range ofresponses by companies – 21% donot provide health screening bene-fits to any employees, while 29%offer this benefit to all employees.In other companies, the benefit isrestricted to various managementlevels.

In 80% of companies, health

screening is offered to top man-agement, and the average reim-bursement is HK$3,467. In 66% ofcompanies, health screening is ex-tended to senior managers, and in

47% of companies it is extendedto middle managers. (Exhibit 2)

Similarly, flu vaccinations are offeredto all employees by 61% of compa-nies, and not provided to any em-ployees in 37% of companies.

Benefits such as gym memberships,where they are provided at all, aregenerally restricted to senior manag-ers.

EDUCATION PROGRAMS

Along with preventative medicine,companies are frequently organizingseminars on health topics for em-ployees. The issues which are mostfrequently addressed in such semi-nars are:

Health and wellness (in 71% ofcompanies),

Time management (58%),

Stress management (55%),

Retirement/financial planning(37%).

This is an area where companies seethemselves playing an increased role.For example, another 16% of compa-nies were planning to introduce semi-nars on stress management.

PERSONAL WELL-BEING

In most US, European andAustralian companies, Em-ployee Assistance Programs(EAPs) are an accepted as-pect of provision for employ-ees’ well-being. EAPs areusually an external servicethat employees can contact

when they have a personalissue that is impeding theirability to do their job.

LevelPrevalence

for thisgroup

Average re-imbursement

(HK$)

Top Management 80% 3,467

Senior Manager 66% 2,616Middle Manager 47% 1,447

All 29% 995

Not Provided 21% N/A

100% 95%84%

68%

45%

24%11% 6%

0%

0%

4% 0%

4%

11%

8%

9%

0%

0%

M a t e r n i t

y

C o m p

a s s i o

n a t e

U n - p a i d

l e a v

e

M a r r i a

g e

E x a m

i n a t i o

n

P a t e

r n i t y

S t u d

y

E x t e

n e d e

d S a b b

a t i c a

l

C h i l d

c a r e

%

of CompaniesPlan to implement

Provide

Exhibit 2: Health Screening Provisions

Exhibit 1: Leave Entitlements Which Companies Provided or Plan to Provide




Issue 9

The survey found that EAPs arenot a common feature of corporatework/life balance initiatives in HongKong. Only 25% of companieshave an EAP in place.

Personal well-being can be fos-tered by companies in other ways,such as through extra-curricularactivities like annual family daysand company-sponsored sportsteams. These are more commonthan EAPs, with 45% of companiesorganizing annual family days and63% sponsoring sports teams. Thisis also an area where companiesare considering increasing their in-volvement.

FLEXIBLE WORK ARRANGE-MENTS

The major advance in flexible workis the implementation of the 5-daywork week, with nearly 80% ofcompanies now having introducedthis. Other initiatives are not socommon. Only 13% of companieshave policies in place on flexibleworking hours, and only 8% have apolicy that allows employees totelecommute. (Exhibit 3)

Moreover, few companies areplanning to change their policies inthese areas. Initiatives such as job-sharing are not in evidence at all ata policy level. Some companiesare more flexible in practice thantheir policies suggest, and allowflexible arrangements at an infor-mal level. Here, companies takeinto account the particular require-ments of the job and the em-ployee’s situation.

SUMMING UP

There is evidence that companiesin Hong Kong are heeding themessage to consider the work/lifebalance of employees, as a way ofensuring that employees are re-tained and committed to the com-pany’s interests. There is a greatvariety of policies and programsamong companies, and it appearsthat companies are still cautiousabout extending the range of bene-fits that are being offered.

ABOUT THE TOWERS PERRINHKHRC

The Towers Perrin - Hong Kong HRCouncil (HKHRC), which was estab-lished by Towers Perrin, is com-posed of top HR executives fromselected leading local and multina-tional companies in Hong Kong. Ithas been designed as an exclusivenetwork for top human resource pro-fessionals to exchange insights intobest HR management practices asthey apply to conducting business inHong Kong and Greater China.

For more information on the HKHRC,please contact Carmen Siu at +8522593-4580 [email protected].

HKHRC AUGUST PULSE SURVEY

The HKHR Council August Pulsesurvey represents the views of 40 ofthe Council’s then-75 members.

The respondent profile spans diverseindustry sectors including Trans-port/Logistics (24%), Financial Ser-vices (13%), FMCG (13%),Telecommunications and Technol-ogy (16%), Real Estate (8%), Gov-ernment/Public/Social Science (5%),Hospitality (5%), Media (5%), andPharmaceutical/Biotechnology (3%),Utilities (3%), and Conglomerates(5%).


Hong Kong – Rajesh Daswani Tel: +852 2593-4565 [email protected]

Arrangement Past/Current Plan to

5-Day Work Week 79% 0

Flexi-Time 13% 0

Job Sharing 0% 0

Compressed WorkWeek

0% 0

Telecommuting 8% 0

Other 3% 0

Exhibit 3: Flexi-work Arrangement in Place




Issue 9

WHAT’S NEW ABOUT TOWERS PERRIN ANDHR SERVICES

Towers Perrin is a global professionalservices firm that helps organizationsimprove their performances througheffective people, risk and financialmanagement. Through its HR Ser-vices business, Towers Perrin pro-vides global human resourceconsulting that helps organizationseffectively manage their investmentsin people. Areas of focus include em-ployee benefits, compensation,communication, change manage-ment, employee research, and thedelivery of HR services. The firm’sother businesses are Reinsurance,which provides reinsurance interme-diary services, and Tillinghast, whichprovides management and actuarialconsulting to the financial servicesindustry. Together, these businesseshave offices in 25 countries.

More information about HR Servicesis available at

www.towersperrin.com/hrservices

CONTACT US

Email： [email protected]@towersperrin.com

Beijing:Tel: +86 10 5821-6000Fax: +86 10 8529-7884

Shenzhen:Tel: +86 755 8246-2022Fax: +86 755 8246-2122

Shanghai:Tel: +86 21 6288-0057Fax: +86 21 6288-1761

Hong Kong:Tel: +852 2593-4588Fax: +852 2868-1517

We appreciate your feedback on China Update.

©Towers Perrin 2006

Towers Perrin

Beijing

We Have Moved!

Towers Perrin Beijing Office hasmoved to Beijing Kerry Centre,South Tower, 29/F on 4th Sep-tember, 2006. The general lineand fax numbers remain un-changed.

Tel: +86 10 5821-6000 Fax: +86 10 8529-7884

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