Fundamentals of Human Resource Management

PT Borwita Citra Prima

By:
Shelly Amelia

(3134010)

Edwin Reinaldy AW

(3134012)

Renaldi Ega H

(3134018)

Anita Felicia

(3134020)

Alina Schmall

Maximilian Markus Wunderlich

Max Jonathan Rickert

David Thore Schultner

International Business Networking

Faculty of Business and Economics
University of Surabaya
2015

I.

INTRODUCTION

Profile and History

Borwita is an East Indonesian distributing company. The business started in 1976,
founded by Mr. Hady Karyono who worked on the pharmaceutical distribution company. The
company was created in the city of Surabaya. So this means, Borwita essentially regulates the
shipping, selling and buying of pharmaceutical products to other parties. As early as 1988,
Borwita underwent serious expansion and enlarged their business magnificiently. In 1993,
Borwita was the only distributor of P&G and Gillette for East Java. Two years later, a new
branch of the company was added: Borwita Citra Prima (BCP) was added as a consumer
good distributor. BCP distributes goods in East Java, Bali and Sulawesi. In 2003, the Ceres
Group joins BCP. In 2006 then, finally P&G and Gilette join forces with Borwita, three years
later PT. Megasurya Mas does the same. Furthermore, in 2011, ABC joins BCP and in 2014
PT. Heinz does. Figure 1 depicts some of Borwitas closest business partners and shows
shipped products.

Figure 1 Associated business partners of Borwita

Values
Borwita cultivates seven rules which are meant to regulate their business to be
successful and to prosper. The seven rules are depicted in figure 2. Those values are at the
core of Borwita to sustain high quality in their work. They do include hints to the actual
praxis of the companies work, such as team work, but also spiritual and personal goals, such
as Integrity. Integrity is the promise to oneself and others to act upon ones beliefs, for
example to speak ones mind or to stand up for the own opinion.

figure 2 core values of Borwita

Current position
The human resources of Borwita have grown extensively since 1976 when they
started as a small business. At the curent point, 2877 people work for the company. Those are
experts in various domains that are all needed for the distribution. There is information
technology (IT), to coordinate processes and to monitor clients and shippings. There are
managers, engineers for the facilities, machines and vehicles. Accounters and financial
experts for the transactions. Sales managers and professionals in marketing to promote the
company and to expand the business.
The business has expanded to having 24 warehouses ofer 17.000 square meres. Right
now, Borwita delivers goods with 232 trucks. By using all of these resources, Borwita is able
to deliver to Bali, whole Java and Sulawesi. Regions east of Bali are not included.

AWARDS
Borwita has won the award of Best Gillette Distributor in Indonesia for 3 consecute years
(2000-2003), also the Leadership achievement P&G distributor award in 2 years (20002002). The Borwita-management told us in an interview that the key to their success is the
relatively low service fee combined with high quality. They also do not sell cigarettes, since
they do not have added value for the customers. They also do not sell two different competing
products.

II.

STATEMENT OF THE PROBLEMS

Once established, a company can prosper and flourish to reach new, yet unseen size. With
it come new partners and clients. New companies can join and trade agreements can be
formed. Furthermore, new areas can be used to expand the business further. With all this
comes a probable increase in profit and more work spaces. Creating work can help a region, a
country and a culture to be advanced in financial terms. This can furthermore be used to build
streets, more taxes are earned, which can help the government to support the people and to
improve the country. Well used, this generated money can be beneficial for a vast amount of
people, from the ground worker in the logistics up to managers, even to the government. This
could even be beneficial for customer needs.
But as a company grows, there would be doubts about the standards keeping. The more
region, the more challenges. There are simply more and more spots where things can go
wrong. Having a small family business can be hard but it stays obversable. One can see all
possibilities, knows everyone and knows the facilities. Big companies do not have structures
that can easily be regulated. So, businesses use structures that regulate quality control.
Summarizing the problem faced by PT Borwita are:

How does PT Borwita manage the employees performance rating and management?

Regarding to the 360 assessment disadvantages, how Borwita overcome those

troublesome outcome?

III.

THEORITICAL BACKGROUND

Background
360-degree assessment (multi-rater assessment) is a feedback system model that
requires feedback on one particular employee from various individuals including employees
subordinates, peers (colleagues), and supervisor(s), as well as self-evaluation. In some cases,
it also includes feedback from external sources such as customers and suppliers or other
interested stakeholders. The results from 360-degree assessment are often used by
corresponding employee to be able to determine their future plan and development path
better. Result can also be used by company to make administrative decision related to pay and
promotions related to corresponding employee.
Application
On first era of 360-degree assessment application, the problem raised from the activity
of collection and collation the feedback that demanded a paper-based effort including either
complex manual calculations or lengthy delays. However, as the technology advanced these
days, assessment can be conducted using online evaluations forms or surveys. Nowadays,
recent studies shows that one-third of U.S. companies use several types of multi-source
feedback like 360-degree assessment. Other claims that almost 90% of Fortune 500 firms use
multi-source feedback like 360-degree assessment.
Accuracy
A study shows that the time length of the rater has known the individual affect the
accuracy most significantly. The study shows that the most trusted results should be acquired
on known for one to three years. Known for one year is assumed to be too early to assess
the person and result is often highly influenced by first impression, while on the other hand
known for three to five years and known more than five years is inaccurate for it is
assumed to be too long that the raters begin to generalize favorably.
It has been proved that multi-rater assessments often generate conflicting opinions
over several different results toward one same employee and thus there may be no way to
determine whose result is accurate. Studies have also indicated that results from selfevaluation are generally significantly higher than results given from others.

Results
Several studies indicate that the use of 360-degree feedback helps the employee
improve its performance in the organization because the employee can see different
perspective regarding his/her performance. While on the other hand, many authors claimed
that there are too many variables in 360-degree assessment to reliably generalize their
effectiveness such as conflicting opinions from different perspective which then generate
confusion in determining whose feedback is accurate and exact.
Maury Periperl of Stanfords General Management Department, stated that there are
four paradoxes that explain why 360-degree assessment system results are not accurate: (1)
The Paradox of Roles, in which an evaluator is conflicted by being both peer and the judge;
(2) The Paradox of Group Performance, which admits that the vast majority of work done in a
corporate setting is done in groups, not individually; (3) The Measurement Paradox, which
shows that qualitative, or in-person techniques are much more effective in facilitating change;
and (4) The Paradox of Rewards, which shows that individuals evaluating their peers care
more about the rewards associated with finishing the task than the actual content of the
evaluation itself.

Additional studies found there is no correlation between an employees 360-degree

result and his/her top-down performance appraisal which provided by his/her supervisor).
Although there are positive and negative perspective and long debates about the effectiveness
of 360-degree assessment, when an organization is willing to implement 360-degree
assessment system, care should be taken in its implementation. It is also suggested by many
researchers to apply and blend between 360-degree assessment system and traditional
performance appraisals to better evaluate overall performance.
Application in Borwita
Borwita claimed that so far 360-degree assessment method fits their need in terms of the
results that generated by each feedback provided from different point of views toward one
particular employee. After collecting and collation the feedback, Borwita encouraged the
employees to use those feedbacks as a guideline to reevaluate their plan and personal
development path to better suit the feedbacks given. Borwita also stated that the problematic
part of conducting 360-degree assessment aside from time-consuming is often in determining
and calculating whose feedback is accurate and exact. Even though Borwita claimed that so
far 360-degree assessment fits their need, Borwita is willing to use another better method if in
the future 360-degree assessment method no longer fits the company criteria in being
effective feedback collection method.

ANALYSIS
Part 1: Performance rating and management
Awards achieved by Borwita arises questions about the method used by Borwita to
align the performance of the employees in line with the targeted objectives. Unlike the
conventional way to evaluate and rate, performance rating of Borwita employees done by
several managerial layers. Performance of the workers are rated by supervisors, directors and
managers. The actual performance is then compared with the standards depicted on figure 2
whether it met each other or not.
The monitoring process is a key element to assess mistakes and standards, corrective
actions have to be undertaken to regulate all actions to the companies path. Borwita rating
process is in fact done with the utilization of the 360 degree assessment method, then the
monitoring processes managed by the quality control management team. One characteristic is
the measurement of every colleague from the perspective of his employer and his colleagues.
This method requires high amounts of available data, but establishes a fair analysis of the
workers performance.
As stated by the HRD of Borwita, Mr. Adtiya, the problems are likely to arises within
the use of this method is the amount of information that has to be processed. This means a lot
of time and work to complete the assessment. But, on the other hand, the assessment is more
accurate and fair than just the conventional as the HRD pleased. By considering those
points, this method is valueable if one wants to establish good workers for a long period of
time.
Part 2:
Borwita as the company that implement

360 as their tools to measure the

performance management of its employees is facing some problems in their practice. As a

professional and expanding company, Borwita try to overcome all of the troubles that occur
in their company. In this case, the existing one is about how to face and overcome their
problems in measuring their employees performance management.
Borwita, whatever the need is, its imperative to have a clear and well-defined
understanding or contract with employees on why Borwita take a 360 assessment as their
methods to measuring the employee performance management. So, employees know well
about what is 360 assessment, and how does it works.

Mr. Aditya, the manager of HRD Department said that 360-degree assessment is a
process for helping people gain a rich, accurate perspective on how others view their
management practices, interpersonal style, and effectiveness. In high-performing teams, like
PT.Borwita, exchanging performance feedback is encouraged. Managers should be willing to
confront acceptable behavior and manage poor performers on an ongoing basis. They must
provide feedback to their staff on an as-needed basis, without relying on a 360-degree
assessment as a replacement for performance management, because others feedback is always
valuable. The managers didnt allow to give their subordinate a special treatment that can
make an unproductive behavior.
PT. Borwita realize that user-friendly be high on the list of criteria when designing a
360-degree assessment process. Spell out who needs to provide feedback to whom. Borwita
make sure there are fair, logical, and consistent criteria for selecting respondents who will
give the valuation. In addition, people in general didnt like to complete a lot of paperwork,
especially for HR driven projects. Thus, the assessment should be clear, make sense, and easy
to complete, because its better to come in on the side of simplicity than comprehensiveness.
One key point for tackling the problem of expansion and long-term success is keeping
the workers motivated. If it is possible to integrate the workers into the company fully so that
they feel responsible for it, they will work better and more engaged. For example, companies
like google use motivational factors other than money to establish quality. Google works with
personal freedom, flexible office hours, individualized work spaces and offices and highquality, free food at the canteen. This makes work relaxing and desirable. If everything
around the work is organized in a smooth and comfortable fashion, it is easier to concentrate
on the actual work.
Borwita uses a special sense of responsibility. Every employer becomes some kind of a
"mother" for his employees. So, the old way of seeing the boss as a grumpy, dominant person
is an element of the past. Now, care and respect are at the heart of the companies' values. This
motivational strategy is inspired by the company P&G. Employers do now assist their
workers with maximum value to get every bit of potential out of them. Emotions, such as
affection and caring behaviours should be shown to each other.

IV.

CONCLUSION

PT. Borwita has experienced rapid growth in its business, in addition to that PT.
Borwita also been successfully solve all the problems that they get very well. They have been
able to resolve their problems with the methods that they employ in the performance of the
company and have a satisfactory outcome. PT. Borwita have motivations that are rarely
known in the world of work in general. They have successfully used these motivations at
work, so that the workers of PT. Borwita managed to get the maximum results in each area of
work of employees. In addition, PT. Borwita also has managed to maintain the performance
management very well so there is no dispute or divisions within the company.

V.

RECOMMENDATION

PT. Borwita has implemented a good method for performance management, but PT.
Borwita still can improve the performance of workers, with a 360-degree methods at their
disposal to evaluate the performance of workers, at this PT. Borwita perform evaluation by
means of the results of the evaluation of the workers were announced online, so workers will
not maximally get a good evaluation, because if workers have questions about the results of
the evaluation and if they want to get a solution or teaching about their problems, they can
not apply for question directly. Instead, they perform evaluations directly and individually in
order to pre pkerja can get maximum evaluation and that workers can improve their
performance after getting their evaluation.

References
http://borwita.co.id/konten.php?id=13
Atkins & Woods, 2002
Bracken, Timmerack, & Church, 2001a
Edwards & Ewen, 1996
Eichinger, 2004
Vinson, 1996
Lublin, 1994; Yammarino & Atwater, 1993; Nowack, 1992
Hazucha et al., 1993; London & Wohlers, 1991; Walker & Smither, 1999
Bracken, Timmreck, Fleenor, & Summers, 2001b; Smither, London, & Reilly, 2005.
Peiperl, Maury, Harvard Business Review, January 2001, Retrieved April 6 2012
Maylett, 2005
Maylett, 2009
Maylett, Tracy M., EdD, Pepperdine Univ, 2005 Abstract, Retrieved May 15 2009