HREXCELLENCE#INSTRATEGY,# … · Myanmar’s" economy" meant" that" the" country’s" talent"...

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HR EXCELLENCE IN STRATEGY, INNOVATION, LEADERSHIP AND CULTURE IN DELIVERING SUSTAINABLE AIRPORTS

PRELUDE

Human Resource Management in Myanmar

For over 47 years, Myanmar was profoundly affected by political instability and economic stagnation, which was largely a result of military rule and economic sanctions imposed on the country. As such, many potential business and investment opportunities were lost, and Myanmar became one of the most under-‐developed nations in the region. Although Myanmar continued to receive foreign investments from neighbouring countries, local companies still faced major difficulties in attracting and retaining talent as well as competent professionals, to contribute to the development of the country.

Human Resource (HR) Management was an issue most local companies were unfamiliar with, mainly undervaluing its strategic importance. This lack of management, together with the sanctions imposed on Myanmar’s economy meant that the country’s talent development landscape was decidedly limited, thus prompting what talented individuals Myanmar had, to seek greener pastures abroad. Within local companies, staff assigned to the HR department were usually inexperienced and unfamiliar with the job scope, and were therefore unable to perform to the company’s needs. Local businesses also tend to operate HR like any other administrative department, without adhering to globally-‐accepted HR best practices or realizing the potential of strategic HR.

Overall, there was a lack of experience in and attention to strategic thinking and forward planning, particularly in terms of retaining, developing and rewarding staff. In fact, most companies do not regard training and the continuous development of staff as an investment. Such an environment and culture affected the confidence and morale of employees, which in turn resulted in unsatisfactory performance and high turnover.

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Since 2012, most sanctions on Myanmar were reversed due to the political reforms. Despite the influx of new foreign investment, local companies struggle to keep up with the demands of investors, who are attracted to competitive economies with proper infrastructure, availability of resources and a productive workforce. Therefore, one of the most crucial aspects to ensure the success of any developing economy or business is the implementation of an effective HR management.

Companies are beginning to realize the importance of having a comprehensive HR management plan. The HR department of any business is responsible for shaping the organization, developing its culture, attracting and selecting proficient candidates, training and retaining experienced and competent employees..

In YACL-‐PAS, the HR department has taken steps to make the strategic changes over the past few years. The department also ensures that employees are aware of the organization’s initiatives so that employees are motivated, rewarded and can work together towards a common mission and vision. Its role is therefore a main driver for organizational success, and this report submission shares its journey of transformation.

Introduction to YACL and PAS

Yangon Aerodrome Company Limited (YACL) and Pioneer Aerodrome Services (PAS), are both part of the Asia World Group, one of the first local corporations focusing on developing Myanmar’s infrastructure. Founded in 1992, the Asia World Group has successfully delivered on infrastructure mega-‐projects, which include airport development. YACL and PAS manage and operate Yangon International Airport and Nay Pyi Taw International Airport respectively. Leveraging on a common HR department overseeing both airports, YACL and PAS implement similar HR practices and often collaborate to improve operations and passenger movement in Myanmar’s two major international airports.

YANGON INTERNATIONAL AIRPORT

NAY PYI TAW INTERNATIONAL AIRPORT

Yangon International Airport (RGN), managed by YACL, is the main tourist gateway into Myanmar. In 2015, the airport handled over 4.68 million passengers, a 135% increase since the country's previous democratic elections in 2010. YIA serves 35 airlines operating a total of 554 flights per week. A new passenger terminal building is under construction and slated to begin operations in March 2016.

A sister-‐company to YACL, PAS manages Nay Pyi Taw International Airport (NYT), serving the capital city of Myanmar. Ten airlines operate to NYT, with international scheduled flights starting only in late 2013. As a young airport with potential for growth, NYT hit a milestone of 152,000 passenger in 2015.

Between the two airports, YACL-‐PAS collectively and proudly employs over 1,400 staff.

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Strategic Review of Human Resource at YACL-‐PAS

From its inception in 2010, YACL-‐PAS faced many challenges in HR. After a 2014 review, and realizing the strategic importance of having purposeful policies and practices, YACL-‐PAS embarked on a HR transformation. These major changes were made starting in early 2014, to motivate staff and attract talent, keeping up with the development of the country and the airport business.

Meanwhile, other strategic-‐level projects being rolled out alongside included the vision-‐mission exercise. And although the organization’s mission and vision statement is yet to be crystallized, YACL-‐PAS works towards its unified service statement, which is:

“To align our airports to the best international standards for passenger facilitation, airport operations and management

with excellent connectivity and service quality, maintaining public aviation safety and security as well as being a choice employer in Myanmar”.

The HR strategic review also reinforces the organization’s service statement by improving performance and sustainability of airport operations through the motivation of existing employees and the recruitment of quality candidates. The review culminated in the creation of four key pillars:

Recruitment • Development & Training • Performance Monitoring & Rewards • Welfare

Strategic Review

Recruitment -‐ Policy -‐ Approach -‐ Sustainability

Performance Monitoring & Rewards -‐ Benchmarking -‐ Grading -‐ Appraisal -‐ Rewards & Incendves

Welfare -‐ Work-‐Life Balance -‐ Corporate Social Responsibility

Training & Development

-‐ Training Needs -‐ Career Development

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I. Staff Recruitment

YACL-‐PAS faced challenges recruiting competent staff to contribute to airport development, in part due to an unproved track-‐record as a young company. The organisation also lacked a proper and consistent recruitment policy, which was addressed as one of the early changes to be implemented.

• Recruitment Policy: Process, Culture & Career Fairs

YACL-‐PAS revamped its recruitment policy by redefining its recruitment process. The new practice includes at least two levels of interviews to ensure a right fit for the vacancy, and a background check with previous employers. Reading and writing skills were tested, and structured conversational questions were also posed during the interview session to evaluate their confidence and ability to perform. To ensure consistency, standard operating procedures (SOPs) and process flows on recruitment were documented and adhered to.

Also, a common local practice in Myanmar is that recruitment is typically done by the parent company. This resulted in a slow recruitment process which required unnecessary layers of approval, and customarily, reliant only on in-‐house recommendations and referrals to relatives and friends. However, to keep up with a highly-‐competitive industry, and as business units and subsidiaries require specific and specialized skills sets, a more nimble approach to recruitment is needed. Since this move away from head-‐office recruitment, the YACL-‐PAS HR department has improved direct recruitment cumulatively by 30% over the past two years.

STAFF AT RGN STAFF AT NYT

To further boost recruitment, the HR department participates regularly in national career fairs, the first being in 2014, and has attended a total of 3 fairs. The response during these fairs has been good; with the latest career fair showing a drastic increment of about 250% in the number of applicants compared to the first job fair. This not only demonstrates the effectiveness of the HR department in promoting the positions available, but also the demand for jobs in the airport. [See Appendix I on recruitment efforts].

APPLICANTS AT CAREER FAIRS

Having sufficient staff is critical for the growth and development of the airport. The most recent recruitment is timely, as the airport company prepares to operationalize it newest terminal building. With the increase in staff numbers, both airports are now able to expand its operations and handle more passengers, which in turn, helps the airports cope with the growing demand for air travel into and out of Myanmar.

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2011 2012 2013 2014 2015

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0 500 1000 1500 2000 2500

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Hire Aviadon Professionals

•  Management & Leadership •  Facilitate Airport Operadons and Growth

Train Local Workforce

•  Transfer Know-‐How •  Keep up with Industry Standards and Internadonal Pracdces

Increase Producdvity

•  Increase Performance and Operadonal Efficiency •  Minimize Cost

• Recruitment Approach: Ensuring a Balanced and Productive Workforce

Due to the scarcity of experienced local professionals in the aviation field, YACL-‐PAS sought to hire aviation experts from the region to improve the company’s overall management and technical competency. The challenge comes in the form of having the right balance in foreign and local staff.

A key approach in attracting experienced foreign professionals from international aviation communities is to effectively lead, manage and contribute to the airport operations and growth, as well as help teach, train, guide and groom a large pool of employable local workforce to keep up with international industry standards of safety, security and operational efficiency.

Having a good, balanced and productive workforce helps the airports to perform operations in a safe, secured, efficient and cost-‐effective manner.

Amendments to the HR policy and recruitment process has aided this positive change.

• Recruitment: Maintaining a Sustainable Workforce

Direct recruitment via mere job applications and career fairs is not sufficient in holding up the workforce. There are other factors such as leadership, culture and supplementary sources of manpower that pay a part in maintaining a steady and quality workforce.

i) Leadership YACL-‐PAS recognizes the roles of effective leaders in the airport. The management staff are periodically sent for training, especially for overseas conferences, to allow for heightened exposure to best practices in the aviation field, including in HR practices. These leaders will then have the responsibility of sharing, guiding motivating and also assessing their subordinates.

Leading from the top, the YACL-‐PAS Chief Operating Officer (COO) regularly heads the strategic and operational meetings with the staff. Performance appraisals [see section III] for the senior management staff are conducted personally by the COO. He uses the various platforms to communicate on the direction of the company, as well as providing assessment and feedback on their individual performance.

Sustainable Workforce

Internship Grooming promising

professTon for AviaTon Industry

Leadership Management

Training Cascading Guidance

Culture Promote Teamwork Social

Team-‐Bonding

Direct Recruitment

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ii) Culture

The working environment and culture also plays a part in retaining staff, so that it does not put a strain on the recruitment process. YACL-‐PAS pays particular attention in encouraging employees from different departments to work together. Cross-‐department projects were introduced to help improve the teamwork and cooperation in the airport. Not only do these projects benefit the airport in terms of improved operations, the staff members are rewarded with incentives, which also resulted in increased productivity.

Social Team-‐Bonding sessions are encouraged in order to build up such culture. For example, a Heads of Department (HOD) dinner party is organized by the HR department twice a year. These dinners bring together HODs and the COO for an evening of socializing and fostering of closer ties. Besides enjoying a meal together, participants also take part in games and trivia about the airport, allowing HODs from various departments to interact and improve inter-‐department relations.

iii) Internship Programs

YACL-‐PAS realized the importance of grooming potential aviation experts, and as such, internship programmes for students majoring in business and aviation were introduced. The program provides promising young talents with opportunities to apply classroom-‐acquired knowledge and skills in working-‐life situations. Interns not only stand to gain invaluable working experience, the program also grooms a line of professionals who will be able to contribute fresh and innovative ideas to the development of the airport and aviation industry in the future. Started in 2014 with 7 interns over 2 batches, the numbers have increase the following year to 11 interns over 2 more batches.

II. Staff Training and Career Development

• Training Needs

Over the years, a lack of structured training and career development have been identified as one of the key triggers for high turnover, low productivity and unmotivated staff. It is the duty of organizations to ensure that adequate training is provided to all staff for them to perform their tasks to the fullest potential. YACL-‐PAS acknowledges this too, and an emphasis was made to address this issue.

Training for management and non-‐management staff have different focus, and the HR department has started to design thorough training paths for different employees. Apart from DCA training, local training and on-‐job training, YACL-‐PAS leverages on the partnerships with industry bodies such as ACI and IATA as well as overseas collaboration with airport partners, to provide diverse forms of training to our staff.

While a more thorough training needs and gap analysis has yet to be completed, the HR department has nevertheless embarked on an interim implementation of improved training program, aimed at expanding the acquired knowledge and receiving required industry certification.

A sample of the types of training for management and non-‐management can be found in the list on the right.

•  AMPAP courses •  ACI-‐Global Training Hub courses •  ACI-‐DNA courses •  Execudve Aviadon Diplomas •  IATA Master Class courses

Management Training

•  Technical Services courses •  Dangerous Goods •  Aviadon Safety and Security courses •  Apron Driver courses •  Communicadve English courses

Non-‐Management

Training

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Rewards & Incendves

• Performance-‐based Promodons, aligned with Career Development • Performance Bonuses

Individual Appraisal

• Performance-‐based Appraisal Form with Individual and Project Repordng •  Twice-‐a-‐year Appraisal

Grading

•  Introducing Tiered Grades •  Simplifiy the Rankings of Employees across Different Departments

Salary Benchmarking & Adjustment

•  Comparing Remuneradon Viz-‐a-‐Viz Other Established Organizadons •  One-‐Time Adjustment

The range of training conveyance also varies, from (management and non-‐management) classroom-‐based operational and technical workshops, to seminars and conferences and also overseas-‐based airport visits.

The total number of training events have increased over time, as seen in the adjacent chart.

[See Appendix II on Training events].

With the considerable efforts spent on training, both the number of employees who have benefited from training, as well as the number of training days, have seen a considerable increase.

III. Staff Performance Monitoring and Reward System

To cultivate a competitive work environment, as well as a means to monitor individual performance, the HR department introduced a performance monitoring system. The Performance Monitoring System is designed to include an industry benchmarking to remuneration, with the cycle peaking with rewards and incentives. The following summarizes the steps taken in implementing the Performance Monitoring System:

Salary Benchmarking & Adjustment → Grading → Individual Appraisal → Rewards & Incentives

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Training Days

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• Performance Monitoring: Salary Benchmarking and Adjustment

Prior to rolling out individual appraisals, YACL-‐PAS conducted a review of staff salaries in then-‐2014 to determine the competitiveness of the market conditions with regards to airport salaries. Since there were no comparable airport staff salaries in Myanmar, the HR department performed an extensive study on various other companies like Myanmar National Airlines (MNA) and Myanmar Airlines International (MAI), two of the primary airlines representing a similar aviation industry. Leading multi-‐national corporations such as Ooredoo, a telecommunications provider headquartered in Qatar, was also used in the benchmarking.

The benchmarking study performed not only allowed us to review our current compensation packages but also provided YACL-‐PAS with an insight of the expected salary range of both new and existing employees. YACL-‐PAS was then able to formulate more suitable remuneration packages that would better appeal to potential employees. These changes also meant that existing staff received an increment in their base salaries.

The one-‐time adjustment for remuneration and salary scales was completed in 2015, with existing staff receiving a least a 25% increase in base salaries. This not only reduced the turnover rates but YACL-‐PAS is now one of the leading paymasters within Myanmar aviation. Furthermore, taking into account the response in the recent career fair, YACL-‐PAS is considered a preferred choice employer in Myanmar.

• Performance Monitoring: Tiered Grading and Airport Job Titles

Tiered grades were introduced to allow for a more streamlined comparison between employees of different positions across different departments. One of the constraints of the lack of a comparative scale, was the issue of allocation of remuneration. The grading tiers made it a more transparent comparison for all staff, and also clearer for the HR department to allocate remuneration and benefits.

The table below provides an extract of the tiered grades, with the full table in Appendix III:

Grades

Positions

M06 Manager

Sub-‐Assistant Engineer (Special) Senior

Medical Officer

M05 Sub-‐Assistant Engineer M04 M03

Assistant Manager Junior Engineer (Sr) Medical

Officer M02 Junior Engineer (Jr) M01

T15

Executive Accounts Executive

Leading Operator

Leading Technician

Executive Nurse

T14 T13 T12 T11

From a perspective of motivation, the tiered system allows for multiple levels of salary increases as the staff progresses from one Grade to another, as compared to only once during a rank increase. For example, it would take an Assistant Manager an average of 4-‐6 years to advance to Manager corresponding to one salary increase at this point. However, with the new grading system, the staff will have a salary increase every 1-‐2 years as he/she progresses through the grades.

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Evaluate

Review Reward

With the grading system being transparent, all employees are informed of the grade they are assigned to, allowing for better motivation for the staff as they would have a progressive goal to work towards.

With the introduction of the tiered grading system, YACL-‐PAS has also reviewed all job position titles to include the 'Airport' designation within the job titles. This is to provide a sense of association to the industry. For instance, the title “Senior Operations Executive” was amended to “Senior Airport Operations Executive”, while the title of “Human Resource Manager” was amended to “Airport Human Resource Manager”.

This change albeit small, formalizes a closer relationship between the staff and the airport company, and at the same time, forging a sense of pride and loyalty to the airport business.

• Performance Monitoring: Individual Appraisals and Rewards & Incentives

With the remuneration benchmarking completed and tiered grading system in place, the HR department proceeded to develop individual appraisals. The objective of the appraisals are as follows:

i. To individually monitor the performance of the staff

ii. To provide a personalized review of the performance by the immediate supervisor, at periodic intervals

iii. To reward the staff via performance bonuses

iv. To plan for promotions as part of career development

The staff appraisal is conducted every six months, with the shorter-‐term reward for performance bonuses and the longer-‐term reward stands for promotions and career planning.

A copy of the performance appraisal form is attached in Appendix IV.

IV. Welfare

YACL-‐PAS aims to be an organization that looks after its employees, building trust and loyalty, between employer and employee. The organization prides itself in looking after its employees, knowing that its employees are also looking out for the interests of the organization as well. Welfare in YACL-‐PAS takes into account, the following factors:

• Regulatory Compliance

First and foremost, all our YACL-‐PAS HR policies are in compliance with Myanmar Labour Laws to providing benefits and welfare to our employees. The working hours, the minimum wage and the leave days policies are some examples of the policies that have to adhered with.

However, meeting merely the minimum requirements is not target, as YACL-‐PAS strives to provide above and beyond these minimum Labour Law requirements.

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• Additional Employee Benefits and Well-‐Being

In addition to the basic salary, the company all supplements employees by providing additional meal, transport and grooming allowances. Health benefits are also extended to our staff, and all airport staff including YACL-‐PAS staff, enjoy free medical consultation and free selected medication at our airport clinic. By doing so, the organization adds value to the lives of the employees.

The HR department also initiated staff discounts, in that staff can enjoy discounted purchases on F&B and retail at most shops at the airport. This initiative was so successful that it was extended beyond the YACL-‐PAS staff, to include all other airport staff.

• Reduced Overtime for Work-‐Life Balance

The company encourages a reduced overtime policy for all staff, which is applied to employees in all positions in our company. Encouraging staff to end work on time creates work life balance as it ensures that staff gets adequate rest before returning to work and allows them to spend more quality time at home with their family and loved ones. Adequate rest also leads to more efficient operations and minimizes risks of incidents since staff are less likely to develop fatigue. The reduced overtime policy also promotes increased productivity, as staff will be motivated to work more effectively during their working hours.

Higher productivity also promotes more time for corporate social responsibility events that allow the employees to connect in giving back to the community, while socializing with employees from different departments, promoting better teamwork and productivity for future cross-‐department projects.

• Additional leave days

In addition, staff who perform exceptionally well and make significant contributions to ongoing projects are rewarded with additional leave days. This incentive motivates staff to actively volunteer and take on projects which will in turn contribute to the development of the airport.

YACL-‐PAS firmly believes that employees who are well taken care off will in turn deliver their best for the company. They will feel that their efforts and contributions are being appreciated, giving them a further sense of pride and achievement that motivates them even further.

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Summary

Human Resource Development is an on-‐going challenge in any industry in any country. Being in Myanmar further amplifies this challenge.

Coupled with the ever-‐increasing demand for aviation and air travel, there is a need to maintain safety, security and operational efficiency. The airport operators require a strong and dedicated team of employees who are able to perform to the best of their abilities to ensure the success of the airport. The role of the HR department must not be taken lightly.

The HR team at YACL-‐PAS has grown and matured from a department that faces high turnover rates and struggles to employ suitable candidates, to a department which encourages a competitive work environment with constant development and upgrading of staff, motivating them to perform and have pride in their work. The HR department took steps to transform its function from an administrative role to that of a strategic role.

While the journey is on-‐going, the progress and innovation made to the HR system has been promising, with evidence of increased recruitment, greater numbers for promotion and improved productivity from employees. Moving forward, the HR team plans to increase motivation and reduce the turnover rates, while developing a steady stream of aviation professionals who will be able to contribute to the future of aviation.

Innovadon

Strategic HR System

Recruitment

Performance Monitoring &

Reward

Staff Welfare

Staff Development

Training

Effecdveness

Recruitment policy significantly improve quality and quandty of candidates

Performance Monitoring Improve

performance in a compeddve work environment

Staff Welfare Create work life

balance to improve efficiency

Staff Development Training

Developing and strengthening the current employees

Applicability

Recognidon and implementadon of our HR policy by parent company

Referencing of HR policy by other

Aviadon organizadon

Proven Contribudon to Airport Business

Increase percentage of internally

promoted staff minimizing

training cost and recruitment charges

Assigning quality candidates to the right diesignadon for maximum producdvity

Increase producdvity for

sustainable airport business

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APPENDIX I

Recruitment Efforts

RECRUITMENT PAMPHLET DISTRIBUTED DURING CAREER FAIRS

RESPONSE OF APPLICANTS AT CAREER FAIRS

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APPENDIX II

Training Events

ACI-‐DNA TRAINING IN YANGON, MYANMAR, 2015;

HR TRAINING & DEVELOPMENT COURSE 2013; ACI-‐AMPAP GRADUATION (FIRST 2 MYANMAR IAPs) 2015;

MYANMAR CIVIL AVIAION DEVELOPMENT CONFERENCE 2015

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APPENDIX III

Grading Matrix

Grades Positions

SS7 General Manager Chief

Engineer

SS6 SS5 Deputy General Manager SE SS4 SS3

Assistant General Manager DSE

SS2 Executive Engineer

SS1

M12

Senior Manager Assistant Engineer

M11 M10 M09 M08 CMO M07 M06

Manager SAE (Sp)

SMO M05 SAE M04 M03

Assistant Manager JE (Sr)

MO M02 JE (Jr) M01

T15

Executive Accounts Executive

Leading Operator

Leading Technician

Executive Nurse

T14 T13 T12 T11 T10 Senior

Officer Senior Cleaner

Senior Accounts Officer

Senior Operator

Senior Technician

Senior Nurse T09

T08 T07

Officer Cleaner Accounts Officer Operator Technician Nurse T06

T05 T04 Senior

Controller Junior Cleaner

T03 T02 Junior

Controller

T01

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APPENDIX IV

Performance Appraisal Form

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APPENDIX V

Staff Social Events and Corporate Social Responsibility (CSR) Events

Year-‐end staff party to promote closer ties

Assisting with disaster relief efforts

Volunteering at local orphanages

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