Title

Author(s)

Linkage between business strategy and human resources

management: case study of a telecommunications companyin
Hong Kong
Cheng, Lai-sim.; .

Citation

Issued Date

URL

Rights

1995

http://hdl.handle.net/10722/37739

The author retains all proprietary rights, (such as patent rights)

and the right to use in future works.

UNIVERSITY OF HONG KONG

LINKAGE BETWEEN BUSINESS STRATEGY AND

HUMAN RESOURCES MANAGEMENT
_ CASE STUDY OF A TELECOMMUNICATIONS
COMPANY IN HONG KONG

SUBMITTED B Y
CHENG LAIS M
IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR
THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION OF
THE UNIVERSITY OF HONG KONG
AUGUST 1995

CONTENTS
Abstract
Chapter 1

Introduction

Chapter 2

Literature Review
2.1.
2.2.
2.3.
2.4.

Chapter 3

Chapter 4

5
9
13
34

Company Background

45

3.1.
3.2.
3.3.
3.4.

45
48
49
51

General Information
The Competitive Environment
Key Challenges
Meeting the Challenge Initiatives

The Case Study _ Restructuring of Human Resources

Function
4.1.
4.2.
4.3.

4.4.
4.5.
4.6.
Chapter 5

Role of Human Resources in Achieving

Sustainable Competitive Advantage/
Organizational Capabilities
Strategic Human Resources Management
Linkage Between Business Strategy and Human
Resources Management
Transformation of Human Resources Functions

Page

Mission of Human Resources

The New Human Resources Function
Relationship Among Human Resources Services
TeamsCorporate Human Resources Teams, Line
Managers and Employees
New Skills Requirements of Human Resources
Professionals
Issues Identified
Summary

The Case Study - New Career Progression Plan

5.1.
5.2.
5.3.
5.4.
5.5.
5.6.
5.7.
5.8.
5 9.

Objectives
Benefits to Employees
Features of the New Career Progression Plan
Comparison Between New and Old Systems
Assessment and Development
Performance Management System
Planning and Implementation
Issues Identified
Summary

55
56
56
60

61
62
63
66
67
68
68
71
74
75
77
84
85

Conclusion

Appendices

1.
2.
3.

8
8

p
e
d

a
l

n
a
g
n
ni

p
a
h
s
e

Overview of the Reshaping, Retraining and

Redeployment Process
The Briefing Session
The Reshaping Task Force
Redeployment Strategy
Redeployment Policy
Implementation Guide
Communications
Employees' and Line Managers' Concerns
Progress and Projection by End March 1996
Issues Identified
Summary

Chapter 7

References

6.2.
6.3.
6.4.
6.5.
6.6.
6.7.
6.8.
6.9.
6.10.
6.11.

6.1.

e1m
u
t
ss
tn

c
a
r
a
r
r
8

rhe
T
p g

Chapter 6

Organization Chart of Hongkong Telecom

Career Progression Guide
Performance Anchor Forms and Competency
Assessment & Development Forms for Customer
Service (CFO) Stream

89
91
94
96
97
100
111
115
120
122
123
126

ABSTRACT
Hongkong Telecom is moving from a protective, monopoly and regulated environment to
a highly competitive one. The Company has reviewed its strategiesidentified human
resources as a new source of sustainable competitive advantage and recognized that
Human Resources has a role to play in achieving business strategies. To forge a stronger
linkage between business strategy and human resources management, the Company has
implemented a number of initiatives, including restructuring of Human Resources
function, introduction of new Career Progression Plan, and ReshapingRetraining and
Redeployment Programme. However, there are still a number of issues to be addressed
and lessons to be learnt from experience. Success of the initiatives hinges on joint efforts
of the Company, line management, Human Resources and staff.

CHAPTER 1 INTRODUCTION
Hongkong Telecom is the provider of both domestic and international
telecommunications services in Hong Kong. It has long operated in a protected,
regulated and monopoly environment.

As the telecommunications market is

opened upthe competitive environment to the Company is changing.

Facing the intensifying competitionthe Company has taken some steps to prepare
itself to meet the future challenges. The Company has reviewed what it wants to
achieve, its business strategiesand its ways of doing businesses. More important,
the Company has identified new sources of sustainable competitive advantages in
order to beat competition in future. 'People' is identified as one of them.

To ensure that human resources can be effectively utilized and human resources
practices/ systems can contribute to the achievement of Company's strategiesa
number of initiatives have been taken to align human resources management with
business strategies. These include:

Restructuring of Human Resources function and to reposition Human

Resources as business partners to line management;

Introduction of the new Career Progression Plan which forges a stronger

link between reward and skills, performance and contributionand to
facilitate development of individual and organizational capabilities to
support company strategies; and

Introduction of the Reshaping, Retraining and Redeployment Programme

which aims at streamlining the work force and ensuring a balance mix of
skills and talents are available to achieve company strategies.

This paper aims at sharing with readers experience gained by Hongkong Telecom
and demonstrating how theories are put into practice in the above 3 initiatives in 3
case studies.

In Chapter 2literature by various writers on role of human resources in achieving

sustainable competitive advantage, strategic human resources management,
linkage between business strategy and human resources management, managing
downsizing and transformation of Human Resources functions will be reviewed.
It will be followed by company background information in Chapter 3. Details of
the case studies Restructuring of Human Resources Function', New Career
Progression Plan' and 'Reshaping, Retraining and Redeployment Programme7 will
be presented in Chapters 45 and 6 respectively. Finallyissues and
recommendations will be highlighted and conclusion will be drawn in Chapter 7.

CHAPTER! LITERATURE REVIEW

Human resources issues tend to reside in the background of discussions of competitive
advantage. For example, Michael Porter (1985)in his popular value chain approach
to competitive advantage, describes human resources management as support
activity, serves to sustain higher priority primary activities.
Besides, human resources has been viewed as the administrative arm of the company,
without adding value to the business. Human resources is traditionally viewed by line
managers as controlling the business rather than supporting it. Human resources
people focus too much on dealing with administration and maintenance issues, rather
than competency issues of the employees (Conner and Wirtenberg, 1993).
As the competitive environment

changes,

e.g.

deregulation,

emergence of

multinational corporations and collaboration, rising costs and reducing profit margia,
those which have been viewed as source of competitive advantage, like advanced
technology, financial strength and sound production processcan no longer be
sustained. Many companies began to view human resources as a new source of
sustained competitive advantage. Human resources managers began to move beyond
their traditional administrative responsibilities to assume a greater strategic role in the
organization.

In this chapter, various writers' literature on the relationship between human resources
management and competitive advantage/ organizational capabilitieshow human
resources contributes to the achievement of competitive advantage, framework of
strategic human resources management, linkage between business strategy and human
resources managementand transformation of human resources functions will be
reviewed.

2.1.

Role of Human Resources in Achieving Sustainable Competitive Advantage /

Organizational Capabilities

2.1.1. Resource-based View of Strategic Management

The resource-based view of strategic management posits that organizational resources
and capabilities that are rare, valuable, non-substitutable, and imperfectly imitable form
the basis for afirm's sustained competitive advantage (Barney, 19861991).

The resource-based views suggest that human resource systems can contribute to
sustained competitive advantage through facilitating the development of competencies
that are firm specific, produce complex social relationships, are embedded in a firm's
history and culture, and generate tacit organizational knowledge (Barney, 1992; Reed
& DeFUlippi, 1990; Wright & McMahan, 1992).

A fundamental premise of the resource-based view is that organizational competencies

that are heterogeneous and immobile form the basis of sustained competitive
advantage. Barney (1991) argues that in order for heterogeneous competencies to
generate competitive advantage, they must satisfy the following four conditions:

The competencies must be valuable, enabling the firm to exploit opportunities

and/or neutralize threats in the competitive environment

Only a small number of firms in a particular competitive environment possess

these competencies.

The competencies must be relatively immobile to the extent that they cannot
be transferred easily from onefirmto another.

The competencies must have no close substitutes in order to confer durable

economic benefits to thefirm(Barney, 1991; Dierickx & Cool1989).

2.1.2. Competence-Enhancing Human Resources Systems

Lado and Wilson (1994) have explored the potential of human resources systems to
facilitate the development and utilization of organizational competencies. A firm may
achieve sustained competitive advantage through a firm's human resources systems
that can facilitate the development and exploitation of:

Managerial Competencies
organization's strategic leaders to articulate a strategic vision, communicate the
vision throughout the organization, and empower organizational members to
realize that vision (Westley & Mintzberg1989).

Input-based Competencies which encompass the physical resources,

organizational capital resources, human resources, knowledge, skills and
capabilities that enable afirm'stransformational processes to create and deliver
products and services that are valued by customers (Lado et al., 1992).

Transformational Competencies that describe organizational capabilities

required to advantageously convert inputs into outputs (Lado et al1992).

Output-Based Competencies that include all knowledge-based, invisible

strategic assets, such as corporate reputation or image, product or service
quality, and customer loyalty.

Lado and Wilson (1994) have posited that:

Firms with human resources systems that facilitate the development and
exploitation of managerial, input-based, transformational, and output-based
organizational competencies will have a greater likelihood of achieving
competitive advantages than firms that have human resources systems that
destroy these competencies and/or prevent their exploitation.

Firms with configurations of competence-enhancing human resources system

attributes that are unique, causally ambiguousand synergistic will have
sustained competitive advantage over firms that have human resources system
configuration that is typical, causally determinate, and nonsynergistie.

Firms with human resources systems that are reciprocally integrated with their
strategic suprasystems will be more effective in the development and
exploitation of organizational competencies and thus in achieving sustained
competitive advantage relative to firms with human resources systems that are
either sequentially linked to or decoupledfrom their strategic suprasystems.

Firms with self-renewing human resources processes will more likely generate
competencies at a higher rate and, thus, will more likely achieve sustained
competitive advantage than firms with human resources processes that are
self-maintaining.

2.1.3. Organizational Capability Built Around Shared Mindset

Hiltrop (1993) suggests that to build and sustain organizational capability, an
organization has to integrate all four elements of organizational capabilities, i.e. a
shared mindsetmanagement and human resources practicesleadership and capacity
for change into a coherent system that will become a competitive weapon. This
requiresin turn, that human resource managers have the ability and competency to
meet the following criteria:

Become strategic business partners and gear their activities to the strategy and
goals of the organization. Development and training activities, for instance,
must be viewed as means for improving individual and corporate performance,
not as ends in themselves.

Spend time with line-managers both within and outside the organization to
develop a good working knowledge of their service needs.

Actively participate in business planning meetings and offer informed insights

on the competency requirements of the organization, and the actions taken for
acquiring those competencies.

Provide the organization with the right mix of talent to meet current and future
needs of the business.

Ulrich (1992) suggests that to gain competitive advantage in face of increasing

complex and competitive environment, executives need to develop new models of and
approaches to competitive advantage. If competitive advantage is the ability to
anticipate and meet customer needs in unique ways, the competitive challenge is to
discover new sources of uniqueness (Ulrich and Lake, 1990).

When strategic

initiatives merge with human resources plans, businesses may perform in unique ways.
Uniqueness may be the ability to transfer strategy to employee action, to align systems
and strategies, and to make strategies happen.
According to Ulrich (1992), competitive advantage may derivefrom the integration of
strategy and human resources for three reasons:
-

The ability to implement strategic initiatives increases when strategic and HR

plans merge; this ability may be a source of uniqueness. Behaviours may be
shaped through HR practices.

When strategies and HR practices have

_a

common focus, strategic initiatives are implemented more quickly.

-

A uniqueness that stems from merging strategy and HR planning is an

increased capacity for change.
development

HR practices such as staffing decision,

and training programs, incentive

systems

as well

as

communication activities can be used to overcome individual resistance to

change. Strategic initiatives often require change; H R practices help overcome
resistance to change, resulting in a competitive advantage.
-

Uniqueness may exist when there is a 'strategic unity' within the business. A
business with strategic unity is more able to anticipate and meet customer
needs and challenges (Brockbank and Ulrich, 1991). Strategic unity exists
when employees at all levels, employees in diverse functions and the
organization's customers and suppliers outside the organization share the same
mindset.

Unity can be developed through induction, training and

development, cross-functional meetings as well as close relationship with

customers. Strategic initiatives are more likely to be accomplished when a
unity exists; unity evolves from focusing HR practices on the desired and
shared mindset, resulting in a competitive advantage.

2.2.

Strategic Human Resources Management

According to Schuler (1992), strategic human resources management is largely about
integration and adaptation. Its concern is to ensure that:
-

Human resources management is fully integrated with the strategy and the
strategic needs of the firm;

HR policies cohere both across policy areas and across hierarchies; and

H R practices are adjusted, acceptedand used by line managers and employees

as part of their everyday work.

Schuler (1992) presents a 5-P Model of human resources management (Exhibit 1).
The 5 Ts'namely HR philosophypolicies, programspractices and processes, can
be strategic as they are systematically linked to the strategic needs of the business.
Besidesthe model shows the interrelatedness of activities and highlights the
significance of strategy-activity link.

Defining Strategic Needs

Strategic business needs reflect management's overall plan for survival, growth,
adaptability, and profitability. Internal characteristics as well as external characteristics
may well influence the definition of needs. Linkages between human resources
activities and business needs are usually driven by the organization's efforts to
formulate and implement a particular strategy. To trigger specific actions, the business
needs are generally translated into more actionable statements.

Human Resources Philosophy

This is statement of how the organization regards its human resources, what role the
resources play in the overall success of the businessand how they are to be treated

and managed. This statement is typically very generalthus allowing interpretation at

more specific levels of action within an organization.

Organizational Strategy
Initiates the process of identifying strategic business
needs and provides specific qualities to them

Internal Characteristics

External Characteristics

Strategic Business Needs

Expressed in mission statements or vision statements and
translated into strategic business objectives

Strategic Human Resources Management Activities

Exereses how to treat and value people

Human Resources Philosophy

Expressed in statements defining business values and culture
Human Resources Policies

Establishes guidelines for action on people-related business issues and HR

Expressed as shared values (guidelines)

programs

Human Resources Programs

Coordinates efforts to facilitate change to address major people-related

Articulated as Human Resources strategies

business issues

Htmian Resources Practices

Motivates needed role behaviours

For leadership, managerial, and operational roles

Defines how these activities are carried out

Human Resources Processes

For the formulation and implementation of other activities

Exhibit 1: The 5-P Model: Linking Strategic Business Needs and Strategic Human Resources Management Activilies
Source: Schuler R.S., "Strategic Human Resources Management: Linking the People with the Strategic Needs of the Business",
Organizational Dynamics, Summer 1992, Volume 21, Issue 1, pp20.

Human Resources Policies

All of these statements provide guidelines for action on people-related business issues
and for the development of HR programs and practices based on strategic needs.

10

People-related business issues are those that affect the immediate and future success of
the business and involve people. Shared values, which are reflected in the HR policies,
result in partfrom the organization's structure that in turn results in part from the firm's
strategic directions.

Human Resources Programs

Shaped by human resources policies, human resources programs represent
coordinated human resources efforts specially intended to initiate, disseminateand
sustain strategic organizational change efforts necessitated by the strategic business
needs.

The strategic organizational change efforts have several elements in common. First,
they receive their impetus from thefirms strategic intentions and directions. Second,
they represent major people-related business issues that require a major organizational
change effort to address. They also share the reality of having strategic goals against
which program effectiveness can be measured.

Human Resources Practices

In the process of formulating and implementing new strategic objectivesorganizations
typically evaluate the 'who does what1 question. In some cases, this results in a shift of
role responsibilities.

Once the role behaviours are identifiedhuman resources

practices can be developed to cue and reinforce role performance.

Human Resources Processes

This area deals withhow all the other human resources activities are identified,
formulated, and implemented.

Human resource processes seem to vary along a

continuum of extensive participation by all employees to no participation by any

employees.

11

There is a need for consistency across all the strategic human resources management
activities because all such activities influence individual behaviour. If they are not
consistent with each other, i.e., if they are not sending the same messages about what
is expected and rewarded, the organization is likely to be an aggregation of people
pulling in different directions.

This is hardly a situation for the successful

implementation of strategic business needs. Strategic human resources management

requires consistency and a systematic orientation.

Implications
The concept presented by Schuler (1992) proposes that the framework of strategic
human resources management is made up of all activities affecting the behaviour of
individuals in their efforts to formulate and implement the strategic needs of the
business. It carries several significant implications:
-

Successful efforts at strategic H R management begin with the identification of

strategic business needs. If these needs are important to the success of the
business, and if strategic human resources management can be instrumental in
meeting these needs, then these needs should be systematically analyzed for
their impact on human resources management activities, including HR
philosophy, HR policies, H R programs, practicesand HR processes.

Because all

employees are affected by strategic human resources

management, participatory processes may help cement the link between

strategy and HR practices.
-

Strategic human resources management depends upon a systematic and

analytical mindset.

Human resources departments have a significant opportunity to impact their

organizations' efforts to successfully launch strategic initiatives. This argues
strongly for HR's participation in the formulation of strategy.

12

2.3.

Linkage Between Business Strategy and Human Resources Management

A number of writers have written literature and developed models on the linkage
between business strategy and human resources management. Specifically, some of
the writers have explored the alignment of staffing and career management system
with business strategy and role of human resources management in managing
downsizing.

2.3,1. Implementing Strategic Intent: HR Processes as a Force of Change

Gratton (1994) argues that systems to selectinduct, appraise, reward and develop
may conspire to focusenable and sustain behaviours that run counter to the very core
of the strategic intent. Existence of the schism is a reflection of relationship between
those who devise strategy and those destined to implement i t In many organizations,
the business strategy is created in isolation and 'handed down' to the human resource
professionals for implementation. This one-way process occurs because there is no
human resource representation at board level to create initial integration and members
of human resources function have limited business awareness (Tyson and Fell, 1986).
This lack of functional synergy can leave the human resource fiinction developing
human resources systems in isolation from the business.

To achieve synergy between human resources and business strategy, Gratton (1994)
has identified four major imperatives:

Taking a Longer-term Future-oriented Perspective

For an organization to create a workforce capable of responding to the needs
of the future, the means by which they are selectedinducted, appraised,
rewarded and developed must mirror future needs and be capable of realignment as perceptions of future needs change. Without this future
perspective human resource professionals and line managers can only respond
tactically to yesterday's problems or the whims of senior executives.

13

Prioritising and Assessing Leverage and Risk

The portfolio of options for human resource systems is almost infinite. The
greatest challenge to line managers would be how to identify those aspects of
human resource systems and processes that create greatest leverage to meet
the fixture strategic intent, or which are potentially of greatest risk to the
implementation of the business strategy.

Creating Integration Between Human Resources Processes and Outcomes

It is important to maintain a fit between the strategic intent and human
resource processes and the cohesion within the key HR systems to select
induct, appraise, reward and develop.

However, the human resource

implications of strategy also relate to the way in which the jobs are structured
the motivations, aspirations and talents of its peoplethe culture and senior
management. Some degree of coordination between human resource factors
is necessary for the successful implementation of many strategies. One of the
ways is to involve managers from many functions, including human resources,
in discussions about the impact of strategic intent.
-

Increasing Managers' Understanding of the Process

The involvement of line managers and functional specialists is critical to the
successful implementation of strategy.

It is necessary to develop shared

understanding, methodology and skills. The most important aspect of taking a

participative approach is that it can set up an on-going process of strategy
dialogue which provides an opportunity to gain the personal effort and
commitment of managers, to engage them intellectually and emotionally to
create a use of reciprocal responsibility.

Alignment between strategic intent and human resource processes is built on a shared
awareness of long-term strategic intent of the company. Building on this shared
awareness, the group of managers can move towards analysis of the impact of
strategic intent on the structure and culture of the companyon the people and the way
in which they will be selected, appraised, rewarded and developed. They can debate
the alignment between the future requirements of strategic intent and a diagnosis of the
current human resource capability.

14

The shared understanding of alignment can demonstrate dearly the potential risks the
company faces in delivering strategic intent. Following a diagnosis of current human
resource capabilities, it may be found that the business intent is undeliverable and
requires profound modification. This illustrates a situation where the feedback loop
between the present and the future has a negative, restraining effect on the future
vision. Alternatively, an understanding of the current human resource capability may
create an awareness that the vision for the future fails to build upon, lever and
capitalize on these resources.
2.3.2.

Issues Orientated Framework of Human Resources Management

Foundfrom the research by Schuler and Walker (1990), human resources strategy is a
set of processes and activities jointly shared by human resources and line managers to
solve people related business issues.

Through human strategy, human resources

management seeks to add value by identifying these issues, assessing them, and
evaluating and resolving the issues most critical to the organization's competitiveness
and ultimately to its success. It is much action-oriented. The set of processes and
activities involved in humajQ resources strategy is being used to focus, mobilize, and
direct all other of the business.
The development of human resources strategy facilitates the process whereby human
resources concerns are first seen as people-related business concerns and then are
systematically addressed as specific HR issues. This activity of H R strategy is based
on a joint effort of HR and line management in addressing HR concerns as peoplerelated concerns in achieving strategic business objectives - to enhance current and
future performance and sustain competitive advantage.

The process of developing human resources strategies gives a company the following
benefits:
-

Defines human resources opportunities and barriers in achieving business

objectives.

15

Prompts new thinking about human resources issues - orients and educates
participants and provides a wider perspective.

Tests management commitment of actions - creates a process for allocating

resources to specific programs and activities.

Develops a sense of urgency and commitment to action.

Focuses on selected long-term courses of action considered high in priority

over the next two to three years.

Provides a strategic focus for managing the human resources function and
developing human resources staff talents.

This orientation also appears to address human resources issues as business issues.
Thus firms:
-

Keep a management view, not a HR staff department viewof critical issues

and opportunities.

Plan within the context of managing the business strategically.

Allocate and manage all resources for achieving the business's mission and
objectives.

Execute the strategy - this requires effective management consensus

communications to educateand involvement of all parties.

Human resources strategy is likely to be supported by several organizational

conditions:

The organization does strategy plamiing. Strategic planning seems to bring

some concern for the environment which in turn brings concern and
appreciation for human resources concerns.

The organization's strategic planning process allows qualitative as well as

quantitative input and issues.

The organization has a specific strategic thrust that helps to focus line
managers' attention on specificson competition, on the environment, and on
what factors are in the way of attaining success vis-a-vis those strategies.

16

The organization has a corporate planning group.

The external environment plays a major role in the likelihood that human
resources concerns will become people-related business concerns.

The extent to which line managers identify human resources issues as strategic
put them into their business plans, and then try to develop programs to address
them.

It helps if human resources becomes a business partner. This means helping

line managers by defining the client, defining the issuesdoing analysis,
developing action plans, and measuring results. It is also essential that human
resources staff be good, business-oriented planner and analyst in order to add
the value expected of them.

2.3.3. Aligning Career Management Systems with Business Strategy

As suggested by Steele, Bratkovich and Rollins (1990), fundamental changes in

business environmentnature of organization and workforce raise new human
resources issues for organizations. Career management systems must be developed or
revitalized to deliver the new strategic capabilities required by companies undertaking
strategic redirection.

Steel, Bratkovich and Rollins (1990) present a comprehensive career management

model (Exhibit 2) that can successfully address new business and organization needs in
the changing environment.

Besidesit can help deliver new strategic capabilities

required by companies undertaking strategic redirection.

Business strategy, organization/ job design and human resource planning provide
the key inputs for developing a career management system. Organization design
and job design specify the nature and allocation of work required to execute the
chosen business strategy. Human resource planning specifies the number of people
and types of skills/capabilities required to staff the organization.

The career

management system then is configured to move individuals through jobs and

17

around the organization to develop those strategic skills and capabilities needed to
perform the organization's work.

Business
Strategy

Organization and Job

Drivers

Planning Process

Career Management System

Design
Structure
Descriptions
Distribution Templates
Human Resource Cost Impact
Components

Implementation/Administration
Progression/Administration Criteria
Monitoring Mechanisms
Gap Analysis
_
Staff Strategies
Development Paths
Recruiting Profiles
Training Requirements

Linkages

Individual
Assessment &
Career Planning

Reward System

Exhibit 2: Model of Career Management System

Source: Bemadette Steele, Jerrold R. Bratkovich and Thomas Rollins, "Implementing Strategic Redirection Through the Career
Management System",

The design of the overarching framework of the career management system has
the following components:

Structure:
and branches of related job families, required to develop and deliver the
strategic capabilities.

Descriptions: the titling protocol; the type of criteria for determining

movement along a development stream; the descriptions that distinguish
one stream from another and each level with a stream.

18

Distribution Templates',
distribution of employees among the developmental streams and within the
levels of each stream; used to guide decisions about staffing, individual
allocations, and career pathing.

Human Resource Cost Impact

given structure

and

set of distribution templates

based on the

compensation level and target number of employees at each step in each

development

stream; used to

evaluate alternative

structures

and

distributions and to monitor the effect of career management system on

workforce productivity.
Three components provide the foundation for implementation and administering
the career management system:

Progression/Administration Criteria:
management system to individual progression and development decisions
including the criteria for determining readiness to move to the next
step/level in a development stream.

Monitoring Mechanisms:
warning of inappropriate administration of the system over time and for
assessing the effectiveness of the system for both the company and its
workforce.

Gap Analysis:
templates to identify area of need and develop strategies for closing gaps.

An effective career management system requires strong linkage to other critical

human resource programs and processes in order to assure compatible objectives
and mutual support.

The processes for individual assessment and career

planning, and for moving individuals along the career ladders/ branches, are key
implementation mechanisms for a career management system. Needs identified in
the career management system translate into specific objectives for employment
and training programs. The reward system reinforces those behaviours and

19

contribution required at each level in each development streamand assures

parity in pay across the development streams for comparable levels of
contribution.

For organization undergoing business redirection, certain aspects of the model

are particularly vital to assure that the system addresses new business realities
and organizational needs. The areas requiring special focus include:

Upward linkage to the organization's mission and business strategy

Organization should consider reexamining their professional hierarchies if

they have experienced significant shifts in their business environment,
technologies, marketing strategies, or internal functional relationships.
This process begins by identifying those strategic capabilities now needed
in the workforce. When the traditional professional hierarchies and career
paths did not cultivate capabilities, values and behaviours now required,
new and reconfigured career ladders and paths are needed. Values and
behaviours could be instilled and reinforced through selection, promotion,
performance appraisal, reward management, and other human resource
processes. The process can reveal the need for unique jobs. These jobs
may not represent full-fledged career laddersbut through their definition
and staffing they can play an important part in increasing organizational
responsiveness.

Configuration or redesign of jobs and ladders

An organization often requires new or modified jobs to accommodate the

strategic capabilities dictated by its new business strategy or environment.
This may necessitate new or restructured career ladders, or new branches
added to existing laddersto groom individuals for the new roles needed
by the organization.

20

Job that are narrowly defined may require too many ladders, leading to
unnecessary

administrative

complexity excessive

career

pathing

obstacles, and too little variety of tasks to ensure long-term job

satisfaction. On the other hand, jobs that are defined too broadly may
exceed the ability of most incumbents to develop the competencies
needed for satisfactory performance.

Selection of relevant criteria for describing ladders and for making

distinctions between levels

The quality and integrity of a career management system hinge on the

descriptions of the distinguishing characteristics of each level or band in a
ladder. Whether a ladder is segmented into discrete levels or broader
bandthose levels or bands must be clearly distinguished from adjacent
ones.

This is essential for the support of training, development, and

advancement decisions that are consistent with the original intention of

the ladder.

The most common descriptive approaches employ either descriptions of

job content (the general nature of the work at each level)job
competencies (the underlying characteristics of an incumbent that
produce superior performance at that levelor some combination of the
two. Competencies have the advantage of being easily translated into
criteria for selectiontraining, and development programs (Boyatzis
1981). Competencies also can be useful for emphasizing the new values
and orientations required by organizations that are orchestrating
significant culture change. Lack of the appropriate values and orientation
could lead to behaviours that seriously obstruct effective organization
functioning. Job or role outcomes in ladder descriptions can encourage
the direction of competencies and efforts toward specific end results.

21

Development of staff distribution templates

A staffing template is a model for managing the distribution of employees
among multiple ladders and within each ladder. Application of

template
business and organizational needs, both in the near- and long-term.
The human resource planning process of the organization, using a 'zero
base' perspective, first identifies the optimum mix and level of capabilities
for a given business scenario.

Considering these results, the target

percentage or ratio of employees in each career ladder and branch is

specified. This target is further refined by stipulating the distribution, or
percentage, or individuals required at each level within each ladder or
branch. Target template might vary under different scenarios of growth
and business direction. The staffing allocation template is invaluable for
assessing the cost implications of various staffing and distribution
alternatives.

An organization should apportion its current workforce against the new

or revised career ladders on a test basis. A comparison of the resulting
patterns with the

target

template will highlight

implementation and transition problems.

variety

of

This gap analysis can reveal

areas where the organization has too few or too many individuals relative
to its redefined needs.

In such casestransition plans for achieving

targeted levels should be developedincluding such consideration as:

-

formulating make1 versus 'buy' strategies for acquiring the

competencies desired

creating/ modified desired recruiting profiles

outlining training requirements implicit in the laddersand their

make or buy strategies

22

mapping developmental paths and identifying key broadening or

developmental experiences

Comparison between a target template and actual distributions at any

point in time should be part of an ongoing monitoring program. The
target templates must be reassessed regularly as part of the human
resource planning process.

It may be necessary to address how to

'retrofit' current employees, giving them other competencies of greater

need to the organization.

Downstream linkage with other human resource programs

The following critical linkages must be present to ensure that other
human resource policies

and programs support the new career

management:
_

sourcing strategies and hiring plans should incorporate makeversus-buy strategies and desired recruiting profiles.

hiring selection and promotion criteria should reflect the

competencies articulated or implied by the career ladders.

training programs

should be configured to

support the

development of new capabilities.

-

the performance appraisal process should supply key performance

data to support individual career development and progression
decisions.

the individual career planning and development process should

incorporate the developmental paths imbedded in the new ladders
and branches.

the compensation system should provide rewards for the kinds of

behaviors and contributions required in each ladder and at each
levelas well as establish real parity between management and
non-management tracks when equal contributions are received.

23

For a major business redirection, reexamination of the total human

resource strategy may be in order. This may lead to other modifications
in various human resource programs to bring them into line with new
business and organization needs.

Implementation of

monitoring and performance measurement

mechanisms
Monitoring the administration of the system is important to ensure the
appropriate application of the ladder concepts and structures over time
and across organizational units. The erosion of many existing programs
can

be curtailed with early

detection of shifting distributions,

inappropriate application of progression criteria, or misuse of upper

career levels.
Simple monitoring measures might include:
-

longitudinal analysis of staffing distribution patterns within each

ladder on a functional, subflxnctionaland aggregate basis.

audit of progression decisions to ensure consistency over time and

across organizational units.

An organization can also assess the success of the career management

system in increasing the effectiveness of the workforce from two
perspectives:

the perception of the system by the people affected by it.

the measurable impact of the system on business results, e.g.

overall productivity or return on the cost of human capital and
specific forms of contribution by the jobs in the ladder that could
enhance competitive advantage or cost-effectiveness.

24

2-3.4. Aligning Staffing With Business Strategy

According to Bechet and Walker (1993), for organization with ever changing
business needsidentifying and addressing future staffing needs is an important
element of strategy execution and organizational change.

Staffing strategies

guide the recruitment, utilizationdevelopment, movement, and attrition of talent

in ways that support long-term business requirements. The time frame for human
resources planning should match the length of the business planning cycle.

In well-managed companies, both the business focus and the human resources
focus include long and short-term components (Exhibit 3):

Business Focus

Human Resource Focus

Long Term

Business Strategy

Staffing Strategy

Short Term

Budget/Annual Operating Plan

1
^

Immediate Staffing Actions

Exhibit 3. Linking Human Resource Plans and Business Plans

Source: Thomas P. Bechet and James W. Walker, "Aligning Staffing with Business Strategy", Human Resource Planning, Volume 16,
Number 2, pp 6

On the human resource sideimmediate staffing actions are defined annually,

often as an integral part of the budgeting process. Many companies also prepare
longer-term human resource strategies - defined as longer-termdirectional plans
of action - that support business strategies. These human resource strategies
provide a context for defining and integrating short-term human resource
activities and initiatives.

Direct linkages exist between business planning and human resource planning in
both the long and the short-term. Business strategies both influence and are
influenced by human resource strategies. Once business strategies are developed
it is possible to define human resource issues, such as gap between desired and
actual capabilities, that must be addressed for effective implementation of
business strategies.

25

When gaps in the staffing are identifiedthe strategies needed to address the
issues can be developed. Business strategies sometimes assume an adequate
supply of appropriate talent that in reality cannot be recruited or developed in
time. The lack of required talent has slowed capital investment and business
development in some companies. In this case, business strategies were modified
in light of human resource constraints.

Line managers are ultimately responsible for defining staffing requirements,

assessing current talent and performance, and making the selection and
development decisions necessary to ensure that staffing supply will equal to
staffing demand.

Human Resource staff play a key role in supporting this

decision making by providing informationtechnical supportand consulting.

Human resource staff who have a grasp of business issues and a sound
understanding of strategic staffing tools and techniques are in the best position to
act as 'internal consultants'. They can provide value-added services, ensuring that
managers identify critical staffing issues and prepare realistic plans for addressing
those issues.

Strategic staffing planning approach requires an assessment and understanding of

the business context, definition of future requirements, and establishment of
future action commitments. Steps involved in the process is shown in Exhibit 4:
Understand the Business Context
Define Business Scenarios
Identify Staffing Implications
Identify Staffing Drivers

Define Future Requirements

Define Competency and Staffing Requirements
Define Current Staffing
Project Future Staffing Availability

Establishing Future Commitments

Evaluate Current Talent
Define Action Plans
Review Plans and Progress
Exhibit 4: Flaming for Strategic Staffing
Source: Thomas P. Bechet and James W. Walker, 'Aligning Staffing with Business Strategy Human Resource Planning, Volume 16,
Number 2, pp 3

26

Understanding the Business Context

In today's changing business contextplanning begins by looking three to
five years into the future. Managers and human resources staff develop
and evaluate alternative scenarios of future business conditions and
demands. They identify staffing implications of the most likely scenarios
and the factors that drive change in staffing requirements.
The role of human resource staff is to provide a framework for
developing this understanding and to guide the analysis by asking
questions, examining business plansand facilitating a dialogue with and
among managers who are in the best position to anticipate future business
changes.
Defining Future Requirements

Once the future business context is defined, managers and human

resource staff interpret anticipated changes in terms of competencies and
staffing levels required. They also define current staffing in terms of head
counts and the capabilities currently held by the work force. Future
staffing availability is determined by projecting attrition, transfers,
promotions and other staffing changes. Based on their experience and
knowledge, managers identify opportunities to improve job design, talent
utilizationorganization, and competency mix.

Establish Future Commitments

Near term actions should not only address near term staffing imbalances,
but ameliorate anticipated longer-range needs. Human resource staff who
are familiar with alternative actions play a key role in helping managers
formulate suitable and realistic plans. Managers should define staffing
objectives in ways that achievements may be tracked and evaluated.

27

2.3.5. Managing Downsizing

According to Freeman (1994)there are two general approaches to downsizing.
One is downsizing as convergence and the other one is downsizing as
reorientation. Either of these two approaches to downsizing may be the 'right'
approach, depending on the organization's aim and circumstances. Each involves
a particular pattern of downsizing strategies, activities, and changes.

Downsizing as Reorientation

Reorientations are most often brought about by poor performance or perceived

threats to future performance. They involve simultaneous and abrupt shifts in
strategypower distribution, structure, and control systems.

When organizations undertake large-scale downsizing programs, whether as

proactive strategic adaptation or in reaction to past missteps or environmental
changethey should approach downsizing as an opportunity to rethink the
organization, its structure, its primary purpose, and most important goals, from
the ground up and to realign the organization with its environment.

When organizations undertake major downsizing programs, they should follow a

strategy where redesign drives downsizing. Downsizing should be viewed as an
outcome of a redesign effort aimed at altering the organization's fundamental
relationship to its environment. Downsizing and change efforts are likely to be
directed externally in reorientation.

Effectiveness concerns will predominate

efficiency concerns.

Downsizing Tactics

Downsizing tactics refer to the means by which individuals exit the

organization or are redistributed within it.

These include workforce

reduction techniques, such as lay-offsearly retirementsor normal

28

attrition, speed of downsizingretraining and redeploymemt of personnel

to support new activities as well as the selectivity of cuts.

Across-the-board cuts should be avoided; needs and skills analyse and

selective downsizing are critical.

Human resource managers should

compare the skills that will be required in the new organization to the
skills in residence. Planning should aim to preserve needed skills and
knowledge including organization-specific knowledge and history, as well
as to develop new skills. Every effort should be made to retain the most
skilled, high-performing individuals.

Although large-scale downsizing is likely when the organization is

radically altering its structure or its relationship to the environment,
caution should be used in assuming that this implies large-scale layoffs or
other programs such as early retirements or special incentives to leave the
organization can backfire because they offer little control over who stays
and who leaves (Cameron et al.1991).

Lay-offs are difficult to

implement selectively, particularly when contractual obligations or

longstanding practices dictate a seniority criterion or when accurate
performance information is unavailable. More important, layoffs have
been associated with undesirable consequence, such as turmoils, conflict,
lowered moralejob insecurity, and 'survivor guilt.They can damage
productivity and impede the organization's attempts at reorientation.

Downsizing Implementation Processes

Systematic Analysis. Systematic analysis of the organization's structure,

processes, jobstasks, and personnel is necessary. This analysis is part of
determining how to reachas nearly as possiblean 'ideal' organizational
design. If redesign is to drive the downsizing process, then a great deal
of care and planning should go into the redesign.

29

Participation. Organizations also have the choice of employing narrow or

broad participation in identifying the need for change.

Broad

participation refers to both horizontal and vertical decentralization of

decisions about downsizing and redesign, as well as broadly scattered
sources of ideas for change. Bartunek (1988) has suggested that broad
participation can lead in turn to greater ownership and acceptance of
changes, thereby advancing implementation.

Whereas definitions of

organizational mission and the overall vision and direction are likely to
emanate from the upper levels of the organizationspecific ideas about
downsizing and redesign are more likely to be found in the middle and
lower levels.
Communication and symbolic management. When downsizing is part of
reorientation and the organization is implementing broader change, doing
new thingsand in general transforming itselfincreased ambiguity and
uncertainty will likely be resulted. Communication can alleviate these
problems by providing substantive information regarding the content of
changes and their anticipated impact. Communication can also decrease
the incidence of rumoursprovide meaning and reframing for organization
members struggling in the midst of change, create shared meanings,
connect individual efforts and pain to collective goals.
Likewise, symbolic management signals change in the organization. It
can be an important tool for managing and providing meaning and values,
help organization members to reframe the organization and its meaning
for them.
Systemic change. Downsizing as part of reorientation should also include
a systemic approach, acknowledging that the organization is embedded in
a network of other organizations. (Cameron et al, 1991). Relationships
with other organizations can be exploited to further downsizing efforts.

30

Types of Change
Reducing organizational size. There is a four-level hierarchy of these
changes (Freeman, 1992; Freeman & Cameron, 1993). This hierarchy
begins with (1) decreases in size without restructuringand continues
through (2) decreases in the number of parallel units, (3) decreases in
differentiationand (4) divesting or dissolving entire organizational
subunits.

When one moves up this hierarchy, the types of change

encountered go from individual level to organizational level, from less

restructuring to more restructuring, from less extensive and less complex
change to more extensive and more complex change. When organization
design is rethought from the ground up, there is likely to be a high
number of changes involving restructuring, including systemic change.
Downsizing is accomplished primarily by changes involving decreased
differentiation within or between organizational subunits and by
divestment.

Reducing the workload.

This relates to changes made to reduce the

workload of the employees who remain in the organization.

In any

downsizing program, in order to accomplish its basic functions with fewer

peoplethe organization must make changes aimed at reducing and
reconstructing the workload. This can be achieved through changes in
workchanges in technology used and changes in structure.

Accompanying changes.

Downsizing as reorientation is likely to be

accompanied by changes in top management team, changes in technology/

systems as well as changes in organizational mission and strategy. There
may be changes in human resource management system.

These start

with the systematic analysis and selective downsizing (which imply

selective retention), procedures and criteria for appraisingrewardingand
developing employees, career tmcks and employee motivation.

31

Downsizing as Convergence

Downsizing can also be incorporated into the organization's routine as part of

continuous improvement. Managers and all organization members should adopt a
mindset that continually questions the current way of doing things, there is
always room for improvement and constantly seek ways to reduce organizational
headcount and to streamline operations. Downsizing is everyone's responsibility
and it is an opportunity for improvement and innovation.

By integrating a

continuous improvement perspective on organizational change within the

businesss normal operations, organizations may be able to use downsizing today
to avoid massive lay-offs in the future.

Downsizing Strategy

Changes are aimed at refining and reinforcing the organization's basic

approach to doing things and thus are unlikely to produce major
upheavals.

Changes are likely to be internally directed and driven by

efficiency concerns.
-

Downsizing Tactics

Incremental downsizing can be accomplished with relative ease via

normal attrition.

In approaching downsizing as part of continuous

improvement, lay-offs and demotions can also be avoided more easily

when redesign precedes downsizing, because changes under convergence
are localized. In factjob protection for individuals is necessary in order
to generate continuous improvement and to surface suggestions for the
elimination of work and redundancies.

32

Downsizing Implementation Processes

Under downsizing as continuous improvement, the key processes take
place at a micro level accompanying particular improvements. That is
the principal point of implementation is at the level of the individual, job,
task, or process rather than at the level of the organization subunit.

Systematic analysis. Systematic analysis is likely to be localized and ad

hocand to occur spontaneously as ideas and chances for improvement
arise.

Organizations in continuous improvement mode should focus

analysis at the level of specific tasksjobs or processes that can be

eliminated or enhanced. Thus analysis is best conducted at the micro
level by individuals who are close to the process.

Participation. Participation in specific changes is narrow and localized,

but participation in continuous improvement as a general process is
broad.

The individuals more informed about the most affected by

changes should be empowered to make them without invoking multiple

levels of hierarchy. Downsizing during convergence should be largely a
bottom-up processalthough the goals and tone may be set from the top.

Communication and symbolic management.

Communication and

symbolic management are used to reinforce the mindset of continuous

improvement. These processes are important in reinforcing continuous
improvement and the need to seek constantly efficiencies and downsizing
opportunities.

Types of Changes

Changes involving individuals and jobs or tasks are most likely.

Downsizing occurs primarily at the level of the individual or work group
and the workload is reduced largely through changes in jobs or tasks.

33

These kinds of lower-level changes have a less extensive impact on the

surrounding organization. Downsizing as continuous improvement means
always being on the lookout for ways to reducesimplifyand streamline
organizational structures and processes, as well as the number of people
required.

Incremental, localized, less extensive changes are likely to

predominate.
Managers should, therefore, cease treating downsizing as either a quick
fix for the bottom line or as an indication of failure and missteps. Instead,
downsizing should be integrated into the organization's overall
improvement efforts.

Incorporating downsizing into organizational

change and improvement can serve to promote employee commitment, to

move dysfunctional employee turnover into functional employee turnover,
and ultimately to enhance organizational performance and survival.
2.4.

Transformation of Human Resources Functions

A number of organizations become increasingly aware that their existing human

resources functions could no longer meet their business needs and add value to
their business.

They begin to think of transforming the human resources

functions, reviewing the role played by human resources in future and the
competency of the human resources professionals. Human resources is being
regarded as business partners with line managers. In this section, the Northern
Telecom's and AT&T's cases will be reviewed.

2.4.1. Northern Telecom

In order to achieve a full 30% reduction in headcount and in response to

increasing realization that Human Resources had became too internally focused
and thus drove initiatives that did not meet the needs of the business, senior
Human Resources staff began to rethink the Human Resources function
(Kochanski and Randall, 1994).

34

Northern Telecom Human Resources Mission Statement

The mission statement defines what business H R is in.

The mission of the

function is to maximize employee effectiveness in contributing to the achievement

of corporate objectives.

Human Resources does this by cost-effectively

promoting and enabling:

-

strategic leadership with regard to the employees of the corporation

efficientcustomer-satisfying processes and practices

development of employee capability

a healthy and productive work environment

advocacy of fair treatment

the ability of organization to change

New Work Alignments

To ensure that the Human Resources mission can be achieved and the human
resources processes can contribute to the overall business strategythe Human
Resources function was restructured. Outside-in (customer driven) and insideout (core capability) perspectives were applied to align key roles, core
competenciesdelivery paths and relationships. The new structure is shown in
Exhibit 5.
The BU HR groups include a team of HR professionals with broad experience
providing strategic perspective to the senior management of the unit.

Solid line

reporting relationships are within the HR function and dotted line to the President of
the BU. The plan is to reverse those relationships when the rearchitecting is M y
implemented.

35

Corporate HR
'Core Competencies
.Functional competencies
/Roles
Service Delivery
.Corporate-wide programs
Through B.U./ Services
.Standards
for programs
.Agent for Board - 'Due
initiatives
Diligence'
Jointly with B.U. for
.Functional network
Due Dilligence' issues
leadership

ore Competencies
Cost-effective delivery of HR
processes/transactions
Customer Service
Roles
Delivery of common services
Processing of HR-related
transactions

Customers
.All HR for support &
expertise
.NTL Board for 'Due
Dilligence' matters

Service Delivery
Systems
Automation
Outsourcing
Direct delivery
for selected
purposes

Business Unit HR
Core Competencies
Business partnership
Roles
Strengthening B.u
organization effectiveness
HR support for B.U
objectives
HR plan for B.U
B.U. info/feedback to HR

Customers
B.U. management
All HR for sharing
B.U. needs
Service Delivery
Through influence
& consultation with
management

Collaborative customersupplier partnership with

primary consideration
being the business and
employee needs.

Exhibit 5: HR organizational model

Source: Kochanski, J. and Randall, P.M., "Rearchitecting the Human Resources Function at Northern Telecom", Human Resource
Management, Summer 1994, Volume 33, No. 2pp 302.

The HR Services organization provides 'high touch' and 'high tech' services to
managers and employees regardless of their business unit affiliation. The focus here is
on efficiency and quality. The high touch elements include employee and labour
relations and organization development. The high tech elements include transaction
processingcompensation and benefits administration, and information management.
Services is the largest organization within the NT HR. By isolating the transactionbased work, Services is able to aggressively reengineer, automate, and drive toward
more self-service by employees and managers.
A small corporate HR group exists to develop future-oriented productstools
services and systems according to needs identified by the business unit HR groups. In

36

addition, the corporate HR group provides support for acquisitionsdivestitures, and

other corporate office initiatives. The corporate group is made up of experienced
specialists in the area of Organization and Employee DevelopmentHRIS,
Communications, Compensation, and Benefits.

Exhibit 6 represents the critical connections between the line organization and the
three HR groups. The BU HR groups deal mainly with the senior levels of the line
organization. For the Services Group, the relationship is inverted. The Corporate
HR group supports the business strategy as identified by the strategic business plans.
The HR groups have a ccollaborative customer-supplier relationship'. While the
purpose of new architecture is to support business needs and the corridor between
the business strategy and the HR function is the BU HR groups, the relationship
among the three groups is intended to be equitable and jointly satisfying.

HR Senior Management

Corporate HR

Business
Unit HR

Senior
\
Management

Managers

Employees

Exhibit 6: HR relationships
Source: Kochanski, J. and Randall, P.M., "Rearchitecting the Human Resources Function at Northern Telecom", Human Resource
Management, Summer 1994Volume 33, No. 2pp 303.

37

2.42. AT&T

The goal of transformation of the Human Resources function at AT&T is to

transform the 6000 people of the Human Resources organization into strategic
business partner - team players who will help the company sustain its competitiveness
in today's, and tomorrow's, global telecommunications enterprise (Conner and
Wirtenberg1992).

Both the near- and long-term objectives of the reinvented HR role are the same: to do
customer-driven HR work that adds value to AT&T's businesses by leveraging all the
talents of its increasingly diverse work force.

In the increasingly competitive environment, it is increasingly evident that AT&T's

most powerful source of advantage lies in the talent and creativity of its workforce.
AT&T chairman and CEO Robert E. Allen emphasized this point in 1988:

It is our people who must apply the assets of AT&T to create a competitive
advantage in our markets around the world. I trust in our people to apply their
talentsknowledge and skills to make AT&T the global leader in enabling customers
to reap the benefits of information technology. That is our mission."

Human Resources' transformation journey started late in 1988.

One of the

transformation team's first recommendations was to establish the position of HR

Leader for each AT&T business unit and division. These HR Leaders would report
both to the president or division head of a business unit and to the senior vice
president of HR. They were charged with two major tasks:
-

To collaborate with corporate HR professionals to begin shaping a business

focused direction for the HR community.

To partner directly with the business unit heads in their strategic planning
efforts, particularly when those efforts were people-related.

38

In early

1991 corporate Human Resources launched an initiative -

Professionalism
professional skills and behaviours - attributes that would empower the HR
community to contribute more strategically to the company's business goals.

According to customers' viewtomorrow's high-performance HR professional should

model these attributes:
-

Share responsibility for the performance and profitability of the business.

Be customer-driven and operate with the broad perspective of a business

partner, not the narrow perspective of a functional specialist.

Focus on solutions, not activities.

Apply HR expertise creatively and strategically.

Initiate, lead and facilitate cultural change, helping to move the company from
its bureaucraticlevel-conscious tradition to one that champions creativity and
risk-taking.

Support AT&T's globalization drive by creating models for developing global

managers and for transferring core competencies world-wide.

Act with urgency.

A change in mindset is also required:

From
Rulemaker

Consultant

Functional Orientation

Business Orientation

Narrow Perspective

Broad Perspective

Internally Focused

Customer Focused, Externally Competitive

One Size Fits All

Tailored Programs

Traditional Approaches

Thinking 'Outside-The-Box?

Reactive

Proactive

Centralized Decision Making

Framework For Others to Make Decisions

Mutual Distrust

Partnering

Focus on Activities and Processes

Focus on Effectiveness and Impact

39

Based on the findings from extensive internal and external research, a series of
interviews, and the focus groups, a new HR competency modelcalled the High
Performance Excellence Model, was developed.

High Performance Excellence Model (Exhibit 7)

The model presents the success factors for superior Human Resources performance
in complex, fast-pacedcustomer-focused enterprise.

It is expected to be the

centrepiece of all future Human Resources professional development efforts at

AT&T. The skills and behaviours associated with success cluster in the following
three areas:

Accountability for Business Results

-

To stay aligned with business prioritiesa superior HR professional

learns the customer's business as a whole, not just the HR dimensions.
This enables the HR professional to position HR issues in customer
and market terms, and to formulate tailored practices that succeed in
a specific market.

The success factors are:

-

Results orientation

Strategic thinking

Business partner

Customer-focused

Use HR expertise

Self-Image
-

HR professionals see themselves as members of the leadership team

and as catalysts for change. They encourage innovation and creativity
as they communicate a vision of the future to their customersand as
they coach people in the long-range change process.

HR

professionals should express confidence in their viewpoints and

exhibit a can-dcy attitude.

40

The success factors are:

Sees self as catalyst for change

Sees self as member of the leadership team

Demonstrate self-confidence

Managing Interpersonal Relationships

-

To get sponsorship and buy-in of key initiativesHR professionals

build trust and remain open to diverse viewpoints. To overcome
institutional obstacles, they draw on team and relationship-building
skills to persuade others. They use networks and other resources to
bring the best talents, ideas and resources to bear on business
problems.

The success factors are:

-

Building information networks

Influencing others

Exhibiting interpersonal flexibility

Building and managing teams

Energizing and empowering other

Three generic HR competency models were designated:

HR Leader - a senior HR person within a business unit or division.

HR Function Manager - responsible for a function or a group of functions in

corporate, a business unit or a division.

HR Specialist - generally manages a single function in corporate, a business

unit or a division^ and handles the day-to-day issues.

Although the competencies remain the same among the HR modelsthe specific
behavioural indicators of success often vary depending on the degree of responsibility
and leadership required of the position.

41

HR Leaders
<

HR Manager (Function)
>

Accountability for Business Resu

Clusters
Self Image

HR Specialists

Managing Interpersonal
Relationships

Results Orientation
Strategic Thinking
Business Partner

Success Factors

Customer-Focused
Uses HR Expertise

Behavioural Indicators
Demonstrates Sufficient HR Expertise to Achieve Results
Is Sought After by Others as a Problem-Solving Resources
Utilizes "Best" Practices to Bring About Results

Exhibit 7: High Performance Excellence Model

Source: Conner, J. and Wirtenberg, J., "Managing the Transformation of Human Resources Work", Human Resource Planning,
Volume 16, Number 2, pp 22.

Facing the Challenges Ahead

It is necessary to change the perpetuation of traditional expectations of HR by the line
managers. It is necessary to determine how to redefine the relationship between HR
professionals and line managers. It is required to work directly with the business
heads, coaching and educating them about their new HR partners, showing them how
HR people can add value to their businesses. A company-wide vision of how the HR
organization will function in the future should be developed.
To embed real paradigm shift, business managers must learn and understand the
basic role they play in people management. Thus, another major challenge is to figure
out how to educate and encourage line management to assume responsibility for
managing the human side of business.
The old and new paradigms are shown in Exhibit 8 and Exhibit 9 respectively.

42

Human Resources Managers

Business Unit Managers

Accountability for Managing People

Accountability for Business Results

Thmk Bottom Line5 first

Less alert to people impact
Leverage financial and capital assets to
generate profits, and 'delight' customers

Think 'People' first - the Conscience

Less sensitive to business impact
Leverage human assets to maximize
employee satisfaction and contribution

Exhibit 8: Old Paradigm

Source: Cornier, J. and Wirtenberg, J., "Managing the Transformation of Human Resources Woric", Human Resource Planning, Volume 16,
Number 2, pp 22,

Human Resources Managers

Business Unit Managers

Shared Accountability for Business

Results and Managing People

Integrate business and people strategic plaiming

Joint responsibility to share effective human resources management learning
Leveragefinancial, technological, and human assets to create value, 'delight' customers and maximize
employee satisfaction

Exhibit 9: New Paradigm

Source: Conner, J. and Wirtenberg, J., "Managing the Transforaiation of Human Resources Work", Human Resource Planning, Volume 16,
Number 2, pp 22.

2.4.3. Comparison of Northern Telecom's and AT&T's Cases

Both Northern Telecom and AT&T gave good examples of strategic human
resources management in the changing competitive environment by demonstrating

Human resources is regarded as a source of competitive advantage.

Human Resources fiinction becomes important in contributing to the
achievement of corporate strategy by being strategic business partners,

43

merging strategic and Human Resources plans, as well as gearing activities to

the strategy and goals of the organization.
-

Business strategy cannot be created in isolation by line management and

'handed down to Human Resources professionals for implementation.
Alignment between strategic intent and human resources processes by
enhancing shared awareness of Human Resources and line management is
critical.

Joint efforts of Human Resources and line management in addressing human

resources issues as people-related business issues is important.

Northern Telecom and AT&T made similar moves in restructuring Humajm Resources
function by creating a senior Human Resources position reporting to both head of
business unit and Human Resources.

This is to strengthen the role of Human

Resources as business partners and to enhance involvement of Human Resources in

business planning process of line management.

The major differences between the 2 cases are that Northern Telecom focused more
on hard side while AT&T on the csoft' side. Northern Telecom put more emphasis
on the organization structure, role played by each Human Resources team, service
deliveiy processes, efficiencyas well as relationship among Human Resources Teams
and line managers. On the other handAT&T focused more on the importance of
changing mindset of both Human Resources Professionals and line managers, and
how to improve contribution of Human Resources as business partners by redefining
competencies requirements of Human Resources professionals.

Howeverneither 'hard' nor 'soft' elements alone could lead to good strategic human
resources management. Both should be taken into consideration

44

CHAPTER 3 COMPANY BACKGROUND

3.1.

General Information
Hongkong Telecom is a member of the Cable and Wireless pic which together
with its associated companies conducts business in over 50 countries and has
about 40,000 employees. Hongkong Telecom is the provider to both domestic
and international telecommunications services in Hong Kong.

The exclusive

local franchise expires on 30 June 1995 and the exclusive international license
remains in effect until 30 September 2006. It has been agreed with Government
that the international prices will be reduced by an aggregate 12% over a threeyear period, ending next year and there is a price increase capping at CPI - 4%
for domestic services.

The Company Mission

The mission of Hongkong Telecom is:

To be the most successful telecommunications company in Asia

Financial Information
The major shareholder of Hongkong Telecom is Cable and Wireless pic and its
subsidiary companiesand China International Trust & Investment Corporation
Hong Kong (Holdings) Limited and various companies associated with it
(together CITIC) which had notified a beneficial interest in 57.5% and 12.9% of
shares respectively. For the financial year to March 311995total turnover rose
11% to HK$26.91 billion and operating cost grew 9% to HK$17.15 billionas
compared with last year's results. Operating profit was HK$9.76 billion.

For the financial year 94/95Cable and Wireless Group reported turnover at
5133 million and operating profit after exceptional items at 1,134 million.

45

Hongkong Telecom contributed to a turnover at 2244 million and operating

profit at 810 million.

Organization Structure
There are three major companies within Hongkong Telecom Group, namely
Hongkong TelecomHK Telecom CSL and Computasia.

While Hongkong

Telecom and HK Telecom CSL (HKTCSL) mainly provide telecommunications

services and sell telecommunications products, Computasia is mainly responsible
for provision of computer services to the Group.

In March 1991two operating entities, namely Hong Kong Telephone and Hong
Kong Telecom International merged to form Hongkong Telecom. There was
rationalization of overlapping functions, mainly support functions. Around 1,100
employees were declared redundant without advance notice or prior
communications from Management. A total of around $6 billion was paid out as
compensation. This is known as the cMarch 27 Event.
In March 1995marketing and sales functions of non-Mobile businesses in
HKTCSL merged with those in Hongkong Telecom. Mobile business remains as
an independent business unit under HKTCSL.

Organization chart is shown I Appendix 1.

Employees
By end of March 1995there were about 16,000 employees in the Group. With
effect from January 11995the same career progression systemsand pay and
benefits programmes apply to all employees in the Group. Salaries and related
costs represented 21.4% of the total operating costsa rise of 13.4% from last
year.

46

In March 1995the Company announced plans to streamline the workforce

without having to lay off any of its employees. The workforce will be gradually
reduced by 2,500 employees over the next three years.

An internal

multifunctional task force is developing comprehensive redeployment strategies

and programmes to help ease the transition.

For example, the Company is

offering new career opportunities in areas which are currently experiencing

growth.

Businesses in the Region

China remains a very important part of Hongkong Telecom's fiiture plans. Close
to 34% of total IDD revenues and nearly half of total IDD traffic volume is
between the territory and the mainland. The Company is working in partnership
with telecommunications authorities on joint venture projects in various
provincesincluding BeijingShanghai and Guangdong.

Agreement with

Ministry of Posts and Telecommunications on joint development of Beijing Hong Kong fibre optic cable link has also been reached. BesidesLetters of
Intent have been signed enabling Hongkong Telecom to provide GSM roaming in
Beijing and Shanghai next year.
Hongkong Telecom also plays an active role in other parts of the Region. The
Company is the first foreign telecommunications companies licenced to operate
in Singapore. Hongkong Telecom has been awarded the licence to build a second
mobile telephone and paging network as part of MobileOne (Asia) Pte Ltd
consortium. Letters of Intent have also been signed for Hongkong Telecom to
provide GSM coverage in Taiwan and Macau.

In conjunction with nine other leading telecommunications carriers, Hongkong

Telecom is building the longest optical fibre telecommunications superhighway in
the region - the Asia Pacific Cable Network - whichwhen finished in 1996will
be 11,480 km long. By end of this yeara fibre optic cable system linking
Thailand, Vietnam and Hong Kong will be completed.

47

There are altogether 4 representative offices in the region: Taiwan, Singapore

Korea and Vietnam. Following the opening of Vancouver office in November
1994the Company plans to open a second Canadian office in Toronto soon.
3.2.

The Competitive Environment

The environment in which the Company operates is changing from a protected,

monopoly and regulated one to a deregulated and highly competitive one.

In November 1990the Government opened a new page of competition history

for the telecommunications industry in Hong Kong. The Government announced
the opening up of the local telecommunications market when the franchise for
local fixed network of Hongkong Telecom expires on 30 June 1995. The Office
of Telecommunication Authority (OFTA) was set up in July 93 to regulate the
telecommunications market by setting up fair trading requirements and laying
down a set of competitive safeguards.

With the expiry of Hongkong Telecom's franchise on local fixed network in July
1995three new competitors, namely Hutchison Communications, New World
Telephone and New T&T Hong Kongwill join in providing local telephone
services with their own fixed networks.

In addition, OFTA has already made recommendation to issue an extra 6

personal communications service (PCS) licenses and 4 cordless access services
(CAS) licenses in 1996. Such intense competition will further drive prices of
telecom services down and service quality up. The Company is currently bidding
for licences to operate both a PCS and CAS in Hong Kong.

Regarding international services, the franchise of Hongkong Telecom will expire

in 2006. However, there are already a number of resellers providing international
call services with calling card or other call-back services in Hong Kong. To

48

name a fewthey include City Telecom, AT&TSprint and USA Global Link.
This further intensifies competition in the telecommunications industry in Hong
Kong. A price-cutting war has already started. As there is a world-wide trend of
deregulation of telecommunications market, it is very likely that the international
telecommunications services market will be opened up upon expiry of franchise
for international services of Hongkong Telecom in 2006.

3.3

Key Challenges

As both internal and external environment in which the Company operates is

changing, the Company faces and needs to address a number of challenges.

Intensifying Local and Global Competition

Competition in local telecommunications market is intensifying since the opening

up of the market upon expiry of the franchise for local fixed network of
Hongkong Telecom on 30 June 1995.

Three new competitors, namely

Hutchison Communications, New World Telephone and New T&T Hong Kong,
will join in providing local telephone services with their own fixed networks from
1 July 1995.
Though the franchise of Hongkong Telecom for international services is still in
effectthere are already a number of resellers providing international call services
with calling card or other call-back services in Hong Kong. Following the world
trend in deregulation, the international telecommunications services market will
very likely be opened up upon expiry of franchise for international services of
Hongkong Telecom in 2006.
Besides, OFTA has already made recommendation to issue 6 personal
communications service (PCS) licenses and 4 cordless access services (CAS)
licenses in 1996. This would further intensify competition in telecommunications
market in Hong Kong.

49

Limited Growth Opportunities in Existing Business Areas

Currently, the Company focuses much of its businesses on the traditional voice
and data services markets. Howeverin recent yearsthe market growth rate
declined and the market is saturating. The revenue base of the Company would
probably be eaten up by the new competitors. Besidesthe growth of revenue of
the Company is limited by its agreement with Government on reducing the prices
for international services by an aggregate 12% over a three-year period and the
price increase capping at CPI - 4% for domestic services.

To survive the

competitive environment, the Company needs to expand its business to new

areas.

Increasing Customer Demand

With the changes in the social environment and increase in number of

competitors, customers become more sophisticated and demanding. Simply basic
voice and data services and products could no longer satisfy customer needs.
Customers are now expecting value-added and value-for-money products and
services, quality customer service, tailor-made services, total solution and one
stop shopping convenience.

Competencies and Capabilities of Employees

As the environment and technology are changingand the customers become

more and more demandingthe existing competencies and capabilities of
employees may not be able to cope with the future development. The Company
has long been technology-driven and operating in a protective monopoly
environment, thereforetechnical skills in traditional voice and data services are
much more emphasized and better developed than customer service, marketing
and sales skills. The existing competencies and capabilities of employees as well
as the mix of staff in different disciplines may not be able to meet future
requirements in surviving competition and expanding businesses in new areas.

50

Organizational Culture
At present, the Company culture is rather bureaucratic, traditional and
hierarchical. Under such culture, employees observe orders from superiors, there
are barriers between different functions, employees are expecting protection and
care from the Company, employees perform duties according to instructions and
established procedures/ practicesequity and consistency are emphasized,
decisions rested in the hands of superiors, etc. This culture has negative impacts
on the Company's systems and practices and may weaken the competitiveness of
the Company.
3.4.

Meeting the Challenge Initiatives

The telecommunications industry has been more and more competitive.

To

ensure that it can survive and remain competitive in the deregulated environment,
Hongkong Telecom needs to review what it wants to achieve, its ways of doing
business, as well as to prepare itself to take fixll advantage of the emerging
opportunities. Top management team initiated the Meeting the Challengeand
started to review the Company strategy in November 1991shortly after the
merger of Hong Kong Telephone and Hong Kong Telecom International to form
Hongkong Telecom. Many senior managers were also involved in the process.

The objective of the strategy review was to thoroughly review the Company's
strengths, weaknesses, strategies and objectives, and to identify those areas
where the Company should excel in and beat the competition in the long term,
i.e. sources of competitive advantages.

A range of strategic options were

identifiedsuch as advertising, new product/service developmentinnovation

production capabilities.
At last, four competitive advantages in where there is room for improvement and
which are critical to the Company's future success are identified. They are:
Market Position', 'Customer Service'People' and 'Quality Image .

Four

teams which comprised senior managersand were responsible for identifying

how to get from here to there' and action plans were formed.

Market Position

Strategy Statement:
We will maintain an optimum position in our Hong Kong Telecommunications
markets and will seek investment opportunities to position ourselves in selected
telecommunications markets in S.E. Asia.

Action Plans:
-

Improve coordination of customer information databases.

Develop customer incentive programmes.

Establish premium business services.

Cooperate with Cable & Wireless to pursue projects in the region.

Widen the range of products and services offered to customers outside

Hong Kong.

Improve our routes to market by opening representative offices in

different countries.

Customer Service
Strategy Statement:
We will listen to our customers to understand and meet their needs and the
criteria by which they will judge us. We will constantly review and improve our
performance from the customersperspective to ensure that we are easy to do
business with

52

This means the Company should provide products and services that meet
customers' requirements, ever improve levels of service to customers and
provide guaranteed service.
Action Plans:

Establish hard service standards and satisfaction indicators.

Establish Customer Charters which commit the Company to levels of

performance for business and residential customers.

Set up Customer Satisfaction Unit to monitor achievement against

Charter and internal standards, and to recommend changes to internal
standards and service levels.

Set up Customer Care Unit which operates a first tier complaints centre
and analyzes complaints.

Invest in information systems to improve efficiency and productivity and

quality of service to customers as well as to create new products to
improve competitive edge.

Quality Image

Strategy Statement:
"We will achieve status in the telecommunications market place as the benchmark
for Asia. We want customers to come to us on the basis of our reputation

This implied that a quality culturei.e. everyone is motivated to satisfy his

customers, should be cultivated.

To achieve quality, the Company should

identify its customers, determine their requirements, design our processes to meet
their requirements and continually review the requirements and processes.

On the other hand, the corporate image should be developed through reputation,
identity and public relations.

53

Action Plans:

Work towards Group consistency in advertising through establishment of

corporate guidelines.

Evolve the Telecom Showcase to provide an interactive history and

future of telecommunications.

Introduce uniforms for employees who are involved in day to day contact
with customers.

Introduce Total Quality Management and seek ISO 9000 accreditation.

People
Strategy Statement:
"We will give clear direction and leadership to create an environment which
encourages

high

levels

of

achievement,

enhanced

productivity,

open

communication, and respect for the contributions of others. We will develop our
people by substantial investment in training."
It was suggested that there would be a change in management style, from
structured to flexible, from directed to delegated and from standardized to
customized.

Besides, people should be empowered through communication of

clear objectivesopen communicationsdelegation, as well as training and

development.

Action Plans:
-

Review motivation and reward systems to ensure that behaviour and

contribution required for staff are reinforced.

Review training and development programmes to ensure that they are

configured to support the development of new capabilities.

54

CHAPTER 4 THE CASE STUDY _ RESTRUCTURING

RESOURCES FUNCTION

OF

HUMAN

On 25 October 1994Director of Human Resources held a briefing session on the

fiiture role and the new structure of the Human Resources function for all Human
Resources professionals. Director of Human Resources started the briefing
session with the background on why it is necessary to review the future role and
structure of Human Resources function:

"The Company mission is - To be the most successful telecommunications

company in Asia. To ensure that strategic issues are identified, the management
board has started the strategic planning process one year ago.

A 10-year

strategic plan including corporate strategy, strategic objectives, as well as

strategic programmes and activities was developed. Three-year development
plans for different functions were hence derived.

Regarding external and internal environment, we anticipated that there will be

significant changes, like intensifying competitionpressure on margins, significant
changes in organization culture, management style, working environment,
convergence of existing companies and new skills requirements as a result of new
business developmentetc. As human resources has been identified as a source
of competitive advantage, we need to review the current role and structure of
Human Resources and whether the current existing human resources practices
and systems can be aligned with the new business strategy and needs. We need
to ensure that we are facilitating achievement of business strategy/needs. We
should position ourselves as business partners to line management.

A Human Resources Workshop was hence held. A number of senior managers

from Human Resources in the Group have participated in it. In the Workshop,
Company's business strategiesas well as rolestructure and skills requirements
of Human Resources have been discussed.

55

Structure of Human Resources

function has been identified as one of the critical human resources practices/
systems where alignment with Company's business strategies is essential

4.1.

Mission of Human Resources

The mission of Human Resources is To ensure that the Company has the
resources and organizational capability to achieve its business objectives". To
achieve thisthe past role of Human Resources as a rulemaker, an internal police
that controls the business and an administrative arm as well as its inward-looking
style and narrow perspective will no longer be appropriate.

Human Resources

needs to position itself as a strategic business partner of line managers and a

consultant providing support and advice on human resources-related business
issues.

Human Resources professionals should hence possess good business

knowledge, broad perspectives, proactive attitudes as well as consultancy and

influencing techniques.

4.2.

The New EUmrnn Resources Function

To facilitate the development of business partnership with line managers as well

as the provision of consultancy and supportive services, the Human Resources
function was reorganized on 1 February 1995. The new structure is shown in
Exhibit 10.

The new organization is based on local Human Resources Teams providing a full
range of Human Resources services to dedicated business unitsbacked up by
Corporate Human Resources Teams offering specialist skills and addressing
groupwide policy issues.

56

HR Services Teams
Services Team
-Marketing

Corporate HR Teams
Policy & Regional Support

HR Services Team
_ Operations

Errployee Care

R
[ Services Team
Finance, Admin
& New Business
R
[ Services Team
Mobile Business
ISL Services Team
- I n f o Tech

Exhibit 10: New Structure of Human Resources Function in Hongkong Telecom

Human Resources Services Team

There are a total of 5 Human Resources Services Teams which act as consultant
and business partner and provide a full range of human resources services,
including recmitment, manpower planning, personnel and benefits administration,
performance management, employee communications and employee relations to
dedicated business units. Their primary purpose is to provide human resources
support required for the business units to achieve their business objectives and
this is the basis on which their success will be judged.

These teams have dual accountability to the Director of Human Resources and
the head of the business unit that they support. They also draw on specialist

expertise related to

compensation and benefits, information systemsemployee

communications and relations from the two Corporate Human Resources Teams.

Each Human Resources Services Team is headed by a Human Resources

Manager who oversees all the human resources issues of the client business units.
Human Resources Managers mainly work with senior managers in the business
units on human resources issues and participate in business units' management
meetings. They are supported by a number of subteams. Staff in the subteams
are front-line Human Resources professionals responsible for daily operation.

Corporate Human Resources Teams

The primary purpose of Corporate Human Resources Teams is to provide expert

advice and additional resources to support the front line staff in Human
Resources Services Teams. They work very closely with personnel in Human
Resources Services Teams and undertake specific projects jointly/ directly with
line managers.

There are two Corporate Human Resources Teams, namely Policy and Regional
Support Team and Employee Care Team.

Policy and Regional Support Team

It is mainly responsible for review of human resources policiescareer

management and compensation and benefits issues, human resources
information systemspersonnel administration of expatriate staff as well
as providing human resources support to members Cable & Wireless pic
within the region.

There are 3 subteams, namely Policy & Remuneration, Information

System and Regional Support Services.

58

The major purpose of Policy & Remuneration subteam is to ensure

effective consolidation and continuous development of reward systems to
support business objectives. It is responsible for the review of issues
related to compensation and benefitscareer progression, incentive
schemes, human resources policies and practices, salary administration
and administration of medical benefits.

The objective of Information System subteam is to ensure that updated

and accurate human resources related information is provided to support
business decision making. It is responsible for the development,
enhancement and maintenance of the Human Resources Management
Information System which is accessible by all staff in Human Resources
and line managers. Besidesit is responsible for the effective utilization of
computer systems and automation within Human Resources.

The Regional Support Services function is newly created last year as the
Company's business in the Region and its support to enhancing mobility
of human resources within Cable and Wireless pic expanded.

It is

responsible for providing full range of human resources services to

members of the Cable and Wireless pic within the region.

Employee Care Team

The Employee Care Team aims to maintain a positive and open employee
relations climate.

It is responsible for enhancing effective open

communications between management and employees via Joint Staff

Council which is the formal communication/ consultation channel
between employees and managementas well as recognized union. It is
also responsible for organizing company-wide socialsports and
recreational activities, employee welfare programmes, as well as the
management of Credit Union.

59

4.3.

Relationship Among Human Resources Services Teams, Corporate Human

Resources Teams, Line Managers and Employees
Under the new Human Resources structure, the relationship among Human
Resources Services Teams, Corporate Human Resources Teams and line
managers can be described in Exhibit 11.

Management
Board

D i r e c t o r o f Human R e s o u r c e s

Corporate
HR Teams

HR S e r v i c e s
Teams

Senior
Management

Managers

Employee

Exhibit 11: Relationship among Human Resources Services Teams, Corporate Human Resources Teams, line managers and employees.

In last August, Director of Human Resources was appointed a member of the

Management Board. As a result, Director of Human Resources can have a better
perspective on the Company's fixture direction, business strategies and strategic
issues. He can also highlight human resources related business issues to other
Management Board members so that human resources issues can be taken into
account in the determination of business strategies and making of business
decisions. Also, better human resources strategiespolicies and practices can
hence be developed so as to ensure alignment with business strategies and
utilization of human resources as source of sustainable competitive advantage.

60

Through Director of Human Resources and participation in regular management

meeting of client Business Units, Human Resources Managers can have a better
understanding of client Business Unit's business and human resources needs.
Human Resources Services Teams also act as

a bridge between Corporate

Human Resources Teams and different levels of management/employees. On the

one hand, they communicate human resources policies, practices and issues to all
levels. On the other hand, they provide input related to business environment and
business requirements of client Business Units which have impacts on
determination of human resources practices and policies, and feedback comments
collected from different levels on any human resources issues where improvement
and attention are required to Corporate Human Resources Teams.

To ensure that all parts of Human Resources work towards the same direction
and the five Human Resources Services Teams implement human resources
practices consistently, regular meetings among Human Resources Managers and
Corporate Human Resources Team Heads are held.

4A

New Skills Requirements of Human Resources Professionals

As Human Resources is transforming itself into business partners of line
managersonly proficiency in Human Resources knowledge, practices and
systems is no longer sufficient. Human Resources professionals should:

Possess good business knowledge and a broad perspective as a business

partner, not a narrow perspective of a functional specialist.

Be able to apply Human Resources expertise creatively and strategically.

Be able to facilitate and to assist line managers in initiating and leading

cultural change and organization development programmes.

61

In view of thisa series of development programmes in consultancy and

influencing skillschange management and organization development for Human
Resources professionals will be held. BesidesHuman Resources professionals
will be rotated among Human Resources Services Teams and Corporate Human
Resources Teams so that they can become an all-rounded expertise and have a
better understanding of different businesses of the Company and hence a broader
business perspective.

Issues Identified

A number of practical problems have been identified in the implementation

process:

Skills/Capabilities of Human Resources Professionals

As role of Human Resources is changing, skills and capabilities of Human

Resources professionals should be enhanced.

Only proficiency in human

resources skills and knowledge is insufficient. They need to be open-minded, be

alert to changes in business environment, possess good knowledge about business
needs and hence human resources needs of clients, and to apply human resources
expertise creatively and proactively.

Trust and Rapport Between Human Resources and Line Managers

Currently, level of trust and rapport between Human Resources and line managers
is still not strong enough. Besidescommunication is still insufficient. On the one
handline managers may not let Human Resourcesfixllyunderstand their business
needsand human resources related business issues and plans. On the other hand,
Human Resources may still working on some programmes without considering
business needs of clients in advance. For Human Resources to become true
business partners of line managers, trust and rapport between Human Resources
and line management should be enhanced.

Balance Between Business Units' and Company's Interest

As Human Resources Teams work closely with line management and are
responsible to Business Unitthey may tend to achieve Business Unit's interest at
the expense of the Company's. Besides, there may be conflicts between Human
Resources Services Teams which implement the human resources policies/
programmes from clients' perspectives and Corporate Human Resources Teams
which develop company wide policies.

Communication Among Human Resources Teams

As different Human Resources Services Teams support different business units

independently and company wide programmes/policies are developed by the
Corporate Teamssometimes there are misinterpretation of policies and different
practices in implementing the programmes in different teams.

This could

adversely affect the professional image of Human Resources and may cause
grievances from employees.

4.6.

Summary

As human resources has been identified as a source of competitive advantage in

the changing environment, it is necessary to review the current role and structure
of Human Resources function.

Human Resources should position itself as

business partners to line managers to facilitate achievement of business

strategy/needs.

Human Resources should have a better perspective on the

Company's future strategy and strategic issues and to highlight human resources
related business issues to line managers. As a resultHuman Resources function
was restructured in February 1995 and Director of Human Resources was
appointed to Management Broad.

63

The new organization is based on local Human Resources Services Teams

providing a full range of human resources services to dedicated business units,
backed up by Corporate Human Resources Teams offering specialist skills and
addressing group-wide policy issues. Human Resources Services Teams act as the
bridge between Corporate Human Resources Teams and different levels of
management and employees.

There are a total of 5 Human Resources Teams which act as consultant and
business partner to provide a full range of human resources services to dedicated
business units. These teams are headed by Human Resources Managers who have
dual accountability to Director of Human Resources and heads of business units
which they support.

Human Resources Managers mainly deal with senior

managers in their client business units on human resources issues and participate in
management meetings of these business units.

There are 2 Corporate Human Resources Teamsnamely Policy and Regional

Support Team and Employee Care Teamwhich provide expert advice and
additional resources to support the front line staff in Human Resources Services
Teams. Policy and Regional Support Team is responsible for review of human
resources policiescareer management and compensation and benefits issues,
human resources information systems, personnel administration of expatriate staff
as well as providing human resources support to members of Cable & Wireless pic
within the region. Employee Care Team aims to maintain a positive and open
relations

climate by

enhancing

effective open

communication

between

management and employees and organizing various company-wide employee

functions.

As the role of Human Resources is transforming, the skills and competencies

requirement of Human Resources professionals should be redefined. They should
possess good business knowledge and a broad perspective as a business partner,
be able to apply human resources expertise creatively and strategically, and be able

64

to facilitate and to assist line managers in initiating and leading cultural change and
organizational development programmes.

A number of practical issues have been identified, including skills/capabilities of

Human Resources professionals, trust and rapport between Human Resources and
line managers, balance between business units' and Company's interest, as well as
communication among Human Resources Teams.

65

CHAPTER 5 T H E CASE STUDY - NEW CAREER PROGRESSION PLAN

Hongkong Telecom has long been operating in a protected, monopoly and

regulated environment.

Many systems and processes were bureaucratic and

rigid. Some human resources systems and practiceslike career structurescareer

progression and reward system were good examples.

In the old career progression system, qualifications and seniority, instead of skills,
performance and contributionwere emphasized.

Headcount and promotion

were under tight control. In the reward systemthere was no direct linkage
between performance and reward. Besides, training and development of staff
members were not effective in meeting specific business and individual needs, and
development of required individual and organizational capabilities. Under these
circumstances, good performers were not properly rewarded and motivated.
Skills and resources could not be effectively utilized. It was also difficult to
retain, motivate and develop staff. All these are detrimental to competitiveness
of the Company in the competitive environment.

Introduction of the new Career Progression Plan was driven by both internal and
external forces.

There were 3 major internal forces.

Firstlyin 'Meeting the Challenge5 initiatives, 'People' was identified as an area
which is critical to the Company's future success.

It can also support the

achievements of the other 3 areas ('Market Position'Customer Serviceand

'Quality Image).

Systems that ensure development of individual and

organizational capabilities to achieve the strategies should be introduced.

Secondly,

there might be integration of functions among the three group

Companies, namely Hongkong TelecomHKTCSL and Computasia. Different

career structures, career progression systems and reward systems existed in the 3

66

companies had negative impacts on the mobilization of human resources among

the companies and hence the integration of functions.

Thirdly, under the tight financial control, the cost effectiveness of the old system
should be reviewed.

The most important external force is the intensifying competition. Intensifying

competition means the change in ways of doing business, hence types of people
and skills required.

It also leads to increased competition for the pool of

customer service and experienced telecom personnel. Career management and

reward systems that could attract, retain, motivate and develop quality staff
should be adopted.

The new Career Progression Plan was introduced by 2 phases. The first phase
was the pilot run for front-line customer service staff introduced in February
1994.

The second phase was the roll out of plan to all other employees in

January 1995. The Plan is a result of joint contribution of Human Resources,

Training & Development and line managers. Throughout the whole planning and
implementation processcommunication with employees and line managersand
their inputs were emphasized.

5.1.

Objectives

The new Career Progression Plan is introduced as part of the Meeting the
Challenges initiatives. The major objectives are:

To attract, retain and develop qualityemployees by means of a tailormade development and progression plan for various career streams.

To develop individual and organizational capabilities to support the

Company strategies.

To provide a flexible career progression with cbottom-line? control.

67

To forge a stronger link between reward and skills/ performance/

contributions.

5.2.

To provide competitive and market-driven remuneration packages.

To achieve harmonization across three Companies in Hongkong Telecom.

Benefits to Employees

Other than contributing to achieving Company strategies, the new Career

Progression Plan also brings benefits in terms of career developmentreward and
motivation to employees. Major benefits to employees are:

Provision of a systematic career development for employees with skill

requirements clearly defined for each career step of the nine career
streams.

Through recognition and reward, the new Career Progression Plan

encourages employees to acquire new skills for progression and future
development.

The new Career Progression Plan enables line managers to plan, develop
and motivate staff under his/her control in a timely manner and in
alignment with business needs.

5.3.

Features of the New Career Progression Plan

The new Career Progression Plan is significantly different from the existing
career/ salary structures. Major features of the new Plan are described below.

Different Career Structures for Different Streams

Under the New Career Progression Plan, the career structures are developed
based on business requirements, skills requirements and market practices
regarding different streams.

68

There are nine main career streams:

Career Steps

C C l l

-Customer Service (CFO)

-Customer Service (Technical)
-Engineering
-Finance
-Information Technology
-Market/ Product Management
-Sales/Sales Support
-Supplies
-Administration

T1 - T 1 0
El -Ell
F1 - F 8

11-111

M l -M8
SI - S 8
PI - P 9
A l - A10

There are sub streams in certain main streams.

substreams for Supplies stream.

Other areas/ fonctions such as Business Development, Multimedia Services,

Regional Development, etc. follow the progression steps of the appropriate
streams(s) according to professional background, skill mix, and job nature.

Also, the number of career steps within each stream may differ, to meet different
business needs in those areas. The skills levels and core competencies for each
career step are clearly defined. The Career Progression Guide in Appendix 2
shows the career steps of the main streams and provides information on the
corresponding skill requirements and core competencies for each career step.

Progression and development for positions above the new Career Progression
structures are separately planned and managed by senior management.

Two Main Groups Within Each Stream

In each of the career streamsthere are two main groupsnamely

Professional/Managerial and General/Supporting.

Professional/ Managerial

group

and

mainly

includes

General/Supporting group

managers,
mainly

69

specialists

includes

supporting

supervisors

while

staff and junior

supervisors. The boundaries between groups are drawn up to act as benchmark

for external comparison and demarcations for benefit entitlements.

Sub-groups are established within each group to avoid grade drift and unchecked
pushing upof staff. For example, in General/Supporting group of Engineering
stream, there are 3 subgroups. Career steps El-2, E3-4 and E5-6 belong to 3
different subgroups whereas E2E4 and E6 are regarded as cream steps'.

Focus on Skills, Performance, Contribution and Business Needs

Whilst the existing old system is subject to vacancy, the new Career Progression
Plan creates more career opportunities for employees. Progression is based on
individuars merits, skills and achievements, not grade service or seniority. Line
managers are allowed to develop and reward staff under his/her control in a
timely manner based on staffs meritsskills, achievements and on business needs.
There is no fixed service requirement for progression under the new Career
Progression Plan.

High calibre employees with outstanding performance/

contribution will have a faster career progression.

Continuous Review and Development

It is the Company's aim to attractretain and develop high quality employees to

meet customers' needs and contribute to business growth. To achieve this, the
Company adopts a flexible approach to career progression and development,
through a continuous review and development process.

For each particular career streamthere is a tailored review system for

performance management and career progression purposes. A continuous review
and development process is normally conducted by means of a Performance
Anchor Form for General/Supporting group and a Competency Assessment &
Development Form for Professional/Managerial group.

A customized

assessment form is developed for each particular career step which stipulates the

70

required skills/behaviours and competencies for the career steps within

General/Supporting group and Professional/Managerial group respectively.
Skills and competencies are described in terms of demonstrable behaviours so
that the assessors and assessees have concrete examples and evidence for the
application of knowledge and skills in performance on the job.

A set of

Performance Anchor Forms and Competency Assessment & Development Forms

for Customer Service (CFO) stream is shown in Appendix 3.

The review process is a continuous one and is conducted at least once a year for
career progression and reward purposes. In the review process, an employee's
performance, contributions and skills is assessed against the requirements as
stipulated in the Performance Anchor Form or Competency Assessment &
Development Form and the individual's objectives for the assessment period.

5.4

Comparison Between New and Old Systems

Career and Salary Structures

Before the introduction of the new Career Progression Plan, each of the three
Group Companies had its own career and salary structures. This hindered the
cross-company transfer and hence affected the effectiveness of utilization of
manpower resources within the Group.

Under the old Telecom systema banding system was adopted. Band 1 to Band
4 were classified as General staff while Band 5 and above were classified as
Senior staff Basicallydifferent benefit provisions applied t o the 2 groups.
Howeverthere were grey areas in benefits provisions for Band 4. They were not
eligible for work-related allowances as other General staff and were not eligible
for Housing Allowance as other Senior staff.

For Senior staffthe same salary scale applied to the same bandirrespective of
the functions/ areas. While for General staffdifferent salary scales applied to

71

different bands in different functions.

There were 5 functions, namely

AdministrativeOperating, Technical, Secretarial and Sales. Overlapping salary

structures applied to Band 4 and above while non-overlapping salary structure
was adopted for Band 1-3.

The old Telecom CSL system was similar to the career structure under the new
Career Progression Plan. There were two main groups, namely Senior and NonSenior. Employees in different groups enjoyed different benefits.

Overlapping salary structures applied to the two groups. For Non-Senior grades,
different career and salary structures applied to the 8
Accounting/Programming, Administrative,

Customer

functions, namely

Service, Engineering/

Computer Operations, Paging, Retail SalesCashier and Direct Marketing/ Direct

Sales. There were different number of grades within the Non-Senior group in
different functions. While for Senior grades, a single career structure (Grades AC) applied to all functions. Howevertwo different salary structures applied to
Sales and Non-Sales grades.

The career and salary structures adopted in Computasia were the simplest among
the 3 Companies. A single career and salary structure applied t o all employees.
There were 11 grades (Grades 1-11) where Grades 1-6 were Junior grades and
Grades 7-11 were Senior grades. Different benefit provisions applied to these
two groups.

Criteria for Progression

Under the old systems in the 3 Companies, grade service was one of the
requirements for progression. While under the new systemservice requirement
is no longer emphasized. Progression is based on individuaFs skills, performance
and contribution. Fast progression for high-fliers is allowed and encouraged.

72

Besidesprogression was based on job size and availability of vacancies under the
old system but business needs and market conditions under the new system.

Selection Method for Progression

In the old system, vacancies were advertised internally and interested individual
needed t o apply for it.

Shortlisted candidates were interviewed by a formal

selection panel, which consisted of

Human Resources.

line managers and representatives from

While in the new system, employees are being assessed

continually. Once their skillsperformance and contribution warrant, subject to

business needs, employees can be recommended for progression.

Control

In the past, progression was controlled by headcount budget and regular job
evaluation which determined the value of the jobnot the value of the individual
staff member. In the new system, progression is controlled through bottom-line,
budgeting approach and headcount budget. Job evaluation will only be applied
to benchmark jobs for market reference.

Internal Consistency Vs External Competitiveness

Internal consistency in service, skills and qualifications requirements as well as

salary/career structures across different functions were greatly emphasized under
the old system. This hindered flexibility and alignment with market conditions.
Difficulties in attractingretaining and motivating employees in certain functions
were experienced.

While in the new system, external competitiveness is emphasized. Career and

salary structures of different streams are reviewed continuously to ensure that
they are in line with market practices and are competitive.

73

Besidesmore

flexibility can be exercised in handling salary administration and career

progression issues across different streams.

5.5.

Assessment and Development

Under the new Career Progression Plan, managing an employee's career is a

shared responsibility between line manager and employee.

After the assessment which is based on the Performance Anchor Form or the
Competency Assessment and Development Form is conducted, skill gaps for
improvement, potential and readiness for progression/ development for an
individual employee can be identified. Line manager together with the employee
concerned will draw up a specific, achievable and measurable development plan.
Such plan may include training needsagreed job rotation, assignments to
particular teams, projects or customers, overseas attachments, etc. Line manger
can decide at what intervals progress against plan is to be reviewed, given the
business objectives and progression plans for individual

A number of steps have been taken to ensure that assessment is carried out
objectively:

Behaviours and competencies have been developed by teams including

line representatives and all items have been agreed to be specific and
measurable.

Assessments are carried out by supervisors who understand the

requirements of the job and have available evidence of behaviours,
achievements, and performance.

All assessors have been trained in the objectives and principles of

assessment and in the use of the forms.

Assessor training includes simulated assessment and checking to ensure

that assessors have a common understanding of the levels of achievement
and the performance anchors so that they will work t o the same standard.

74

A l l assessments are endorsed by countersigning manager.

When

progression to a higher step is being recommended, endorsement by

functional manager is required.

If an employee being assessed does not fully understand the reasons for the
assessment ratings, he/she will have the opportunity to seek clarification and
discuss the process with the countersigning manager. In exceptional cases where
agreement has not been reached, the final channel of appeal will be to Director.

5.6.

Performance Management System

To cope with introduction of the new Career Progression Plan, a new

Performance Management System is being developed and will be introduced later
this year. The major objectives of the Performance Management System are:

To align performance effort for achieving business objectives; and

To enhance performance ability of all individuals.

The systems adopted for Professional/Managerial and General/Supporting staff

are different.

For Professional/Managerial Staff

The Performance Management System for Professional/ Managerial staff covers

the goal settingperformance reviewand competency assessment and
development.

The main purpose of goal setting and performance review is to help achieve
business

objectives

with

integration

of

performance

effort.

Every

Professional/Managerial staff should set goals with target dates under respective
goal setting areas at the beginning of the year. Some common goal setting areas
are ProgrammeCustomerPeopleProductivity, FinanceNew Development

75

etc.

Individuals may have different goal setting areas but their goals should

support the unit/function/business goals.

Goals should be specific in terms of targets, improvement, costquantityquality,

timing, as appropriate. The completed goal setting form should be kept by the
staff member and the supervisor, each with a copy. Where necessary, goals
should be reviewed during the year, taking into account changes in the business
requirements.

During the yearthe supervisor and the staff member should have regular
discussion and review of the progress in goal achievement. The goal setting form
can also be used for recording progress/ goal achievement during the year.

At year-end, performance will be reviewed against the goals set. The year-end
assessment will provide information as to whether the requirements/targets as
indicated in respective goals have be exceeded, metor partially met.

Managers and supervisors can have continuous competency review and

development planning with their staff with the use of respective Competency
Assessment and Development Forms..

For General/Supporting Staff

The Performance Anchor Form is the key part of the Performance Management
System for General/Supporting staff since it helps indicate the performance and
skills requirements

and is also used for continuous review of skills and

performance and development planning. Details have been described before.

Throughout the yearmanagers and supervisors should communicate regularly to

their General/Supporting staff regarding the plans and priorities of the
unit/fimctionTbusinessso as to help the individuals understand their work
priorities and focus their effort for achieving business objectives.

76

5.7.

Planning and Implementation

5.7.1. Phase I: Career Progression Plan for Customer Service Staff

Reasons for Introduction of the Plan

In Meeting the Challenge' initiatives, customer service and people have been
identified as areas which must be focused on and excelled in to beat competition.
Regarding customer service, customer service standard should be improved, a
service excellenceculture should be nourished and skills of employees should
be enhanced. Regarding people, a stronger link between pay and performance/
contribution should be forged and skills of employees should be enhanced.

To improve customer service and management of customer database, a new

system 'Dragon' was introduced. It consolidated a number of databases and
systems used by

different customer service departments, such as order

processingline testing, installation and maintenance. A new concept 'Customer

Front Officewas also introduced. Upon full implementation of Customer Front
Officeall customer services, such as directory enquiries, international calls,
installation, maintenance, order processingtelemarketing, etc.will be provided
under one roof. All front-line staff will work in one Centre and customers can get
all the services by just calling one hotline number. Front-line staff are hence
expected to be multi-skilled and transfer across functions. However, different
career structures previously existed in different functions hindered such transfers.

Regarding external forcesmore and more companies, like second networks,

paging companiescredit card companies and banks are competing vigorously for
customer service staff. Thereforegood performers should b e retained. The old
rigid reward system and career structure posted difficulties to it.

77

Objectives

The major objectives of introducing the new Career Progression Plan areon the
one hand quite specific to the business needs and on the other hand in line with
Company's strategies. The major objectives are:

To improve customer service standard;

To nourish Service Excellence5 culture;

To forge stronger link between pay and performance/ contribution;

To rely on internal sourcing of good customer service staff;

To develop best in class' customer service staff and groom high fliers;
and

To encourage acquisition of multi-skills and cross function transfers.

Planning and Implementation

A task force consisting of representatives from respective customer service

functions, Human Resources and Training & Development was formed. It was
responsible for the planning and implementation of the new Plan.

To ensure that the new career and salary structures are in line with market
practices and conditions, Human Resources conducted a market survey on career
structuresskills requirements and responsibilities of customer service grades.
Proposal on career and salary structures was then prepared. The structures were
modified based on the inputs from line managers.

Line managers were mainly responsible for specifying job responsibilities of

different career steps in different functions, identifying skills requirements for
different career stepsassessment and development of employees, as well as
communication of the new career/ salary structuresand assessment and
development approach to employees. They also determined the target profile of
the staff populationincluding percentage of staff to be appointed to 'cream

78

steps.

Based on the target profile determined by line managers, Human

Resources conducted costing analysis.

Training & Development developed customized Performance Anchor Forms for

different career stepsin conjunction with line managers.

The Performance

Anchor Forms were for assessment and development purpose.

The major

assessment criteria were customer handling behaviour, ability to handle operating

system, job and product knowledge and behaviour as team member.

After approval was obtained from top management, the New Career Progression
Plan for Customer Service staff was implemented. The implementation schedule
was as follows:

^^

Announceframework to line manager and Joint Staff

Council
Communicate the new scheme to staff
Training of assessors
Commence assessment process
Transfer existing employees to new plan
Appoint first batch of staff to ccream steps'
Draw up development plan for those who require
further training/ development
Measure effectiveness of plan

Time Frame
End December 93
January 94
By mid January 94
Mid January 94
1 February 94
March 94
January 94 onwards
August 94

What Have Been Achieved

A l l front-line staff (about 2000) were included in the new Plan with effect from 1
February 1994. They were all transferred to Customer Service - Customer Front
Office stream. In the first batch of assessment conducted in March 1994about
21.3% of staff were appointed to ccream stepand 2.9% increase in salary was
incurred. By end June 1995a total of 31.2% of front-line staff were appointed
to 'cream steps'.

79

5.7.2. Phase II: Career Progression Plan for All Other Staff

Reasons for Introduction of the Plan

Introduction of the new Career Progression Plan addressed 3 main issues.

Firstlyto harmonize the career and salary structures among the 3 group
companies to prepare for future integration of the companies.

Before

introduction of the new Plan, the 3 group companies had their own career and
salary structures.

This not only hindered inter-company transfer but the

integration of most of the functions in the 3 companies at a later stage.

Secondly, to be more in line with the market practices in the competitive

environment.

In the past, there was rigidity in rewarding good performers

because seniority and qualifications were emphasizedthere was no direct link

between pay and contribution, and internal relativity rather than market
competitiveness was stressed. Introduction of the new Plan could address these
issues.

Thirdly, the proven success of the phase I introduction for Customer Service staff
encouraged roll out of the Plan to all other staff.

Objectives

The objectives of introducing the new Career Progression Plan have been
discussed before. They are:

To attractretain and develop 'quality' employees by means of a tailormade development and progression plan for various career streams.

To develop individual and organizational capabilities to support the

Company strategies.

To provide a flexible career progression with bottom-line control.

80

To forge a stronger link between reward and skills/ performance/

contributions.

To provide competitive and market-driven remuneration packages.

To achieve harmonization across three Companies in Hongkong Telecom.

Planning and Implementation

Againintroduction of new Career Plan for all staff was a joint effort from line
managers, Human Resources and Training & Development.

Shortly after introduction of the new Career Progression Plan for Customer
Service staff, a total of 8 Task Forces consisting of line managers, as well as
representatives from Human Resources and Training & Development were
formed. Each of them was responsible for the development of framework of
career structures and assessment toolsas well as identifying skills requirements
and assessment criteria for a particular career stream (Customer Service Technical, Engineering, Finance, Information Technology, Market/Product
Management, Sales/Sales SupportSupplies and Administration). In the process,
they had taken into account business needsexisting career structures, and
market practices.

To ensure that the new career and salary structures are in line with market
practices and competitive, Human Resources conducted a market survey on the
career structures, salary structures and skills requirements of different career
streams among a number of commercialfirmsutilitiesgovernmentbodies and
accountancy firms. Such market information was taken into account in the
preparation of proposal.

A discussion session among Human Resources representatives was held after

proposals for different career streams were prepared. The discussion session was
very

fruitful.

Many issues were raised and resolved.

81

All had a clear

understanding of the common framework and basic principles on which the

career/salary structures should be built.

B y assuming different portion of staff would be appointed to cream steps

Human Resources conducted costing analysis for different scenarios.

After approval for the proposal was obtained, a special communication task force
consisting of representatives from different career stream task forces was formed.
Communication of the new plan was in high profile. It aimed at ensuring that:

A l l line managers and staff have a clear understanding of objectives

benefits and framework of the planthe career structures, the skills
requirements of different career steps, as well as the new career
management philosophy.

Two-way communication channels between management and staff were

established and maintained.

The communication plan was as follows:

g
Briefing sessions to line managers and Joint Staff Council
representatives
Distribution of Career Progression Folderconsisting of
covering memo from Chief Executive, Career Progression
Plan Booklet, Career Progression Guide,
Implementation/Communication Plan and Questions &
Answers Bulletin, to all staff
Communication with staff
- Line managers to brief staff
-Career Progression Video broadcasted through internal TV
network
-Feedback through HR Hotlines
Regular Questions and Answers Bulletins (Weekly or biweekly) summarizing staff enquiries
Letters to individual staff members advising them of their
new career steps w.e.f. 1 January 1995

82

12 September 94
13 September 94

13-30 September 94

19 September to 15
October 94
30 December 94

Feedback and inputs were collected through different communications channels,

like Human Resources Hotlines.

Such inputs were valuable to the

implementation of the Plan.

The implementation plan was as follows:

.Events
Horizontal transfer of all staff in Hongkong Telecom,
HKTCSL and Computasia to the new structures
Assessment of skills, performance and contribution of staff
by line managers
Line managers draw up development plans for those who
require further training/ development
Appointment of qualified staff to higher steps
Line managers to include in 95/96 business plan the effect of
new career structures

1 January 95
January 95 onwards
January 95 onwards
April 95 onwards
March 95

What Have Been Achieved

In the second phase of implementation, all the staff in the Group (about 13,000),
other than those Customer Service staff who have been transferred to the new
Plan in February 1994were transferred horizontally to the new career structures
on 1 January 1995. Assessment in accordance with their skills and performance
requirements was then conducted, and appointment to next higher step
commenced in April 1995.

A total of about 1,100 staff representing about 7.8% of the total number of staff
within the Career Progression Plan are being recommended for progression to the
next higher step after the first batch of assessment in April 1995. Two of the
Technical Customer Services functions recommended over 20% of staff being
appointed to higher steps. By end June 199513.2% of staff were at ccream
stepincluding staff in Customer Service - Customer Front Office stream.

83

5.8.

Issues Identified

A number of practical issues have been identified:

Target Staff Distribution Templates

In developing the Plan, there is no target staff distribution template.

Thus, it

cannot be assured that the distribution of staff across career streams and career
steps reflects the anticipated business and organizational needs. Besidesthere
will be difficulties in measuring the effectiveness of the Plan and developing
effective sourcing, training and development programmes.

Monitoring, Control and Maintenance Mechanisms

Currently, there are no established monitoring, control and maintenance

mechanisms for the new Career Progression Plan. The Plan may be misused or
exploited, deteriorated in time, or cannot stay competitive as compared with
external market. There is inconsistency in application of assessment tools across
the Company and grade drift issue caused by overuse of the tools and principles
under the Plan. Besides, the skills and competency levels as stipulated in the
assessment tools may be outdated in time. Alsocost effectiveness cannot be
measured. Therefore, proper mechanisms should be established.

Link Between New Career Progression Plan and Performance Management/

Reward System

Currentlylink between new Career Progression Plan and performance

management/ reward system is rather weak. As a resultthe desired individual and
organizational skills and capabilities cannot be developed, retained and reinforced.

S4

Line ManagersOwnership

Many line managers still view that the Plan is just another performance appraisal
system and human resources practice. They do not understand that they can folly
utilize the Plan to develop capabilities required to achieve their business and
strategic needs.

Besides, they actually have an important role to play in

monitoring, controlling and maintaining the Plan.

5.9.

Summary

Introduction of new Career Progression Plan was driven by both internal and
external forces. Internally, 'people' has been identified as an area critical to the
Company's future success.

It is necessary to ensure that individual and

organizational capabilities contributing to achievement of

strategies are

developed. Besides, there will be integration of fonctions among the 3 group

companies. A common career management system can facilitate mobilization of
manpower among the companies. In addition, cost effectiveness of the old system
should be reviewed under tight financial control.

Externally, the Company is

facing intensifying competition which leads to changes in ways of doing business,

types of people and skills requiredand career management and reward systems to
be adopted.

The new Career Progression Plan is developed based on business requirements,

skills requirements and market practices regarding different career streams. There
are 9 main career streams and two main groups within each stream. The number
of career steps within each stream may be different to meet different business
needs in these areas. Skills levels and core competencies for each career step are
clearly defined. Under the new Career Progression Plan, progression is based on
individuars merits, skills and achievements.

Line managers are allowed to

develop and reward staff under his control in a timely manner based on staff s
merits, skills, achievement and on business needs.

85

For each particular career stream, there is a tailored review system for
performance management and career progression purposes.

A customized

assessment form is developed for each particular career step which stipulates the
required skills/ behaviors and competencies for different career steps within
General/Supporting group and Professional/Managerial group respectively.

continuous review and development process is normally conducted by means of a

Performance Anchor Form for General/Supporting groupand Competency
Assessment and Development Form for Professional/Managerial group.

After

assessmentline manager together with employee concerned will draw up a

specific, achievable and measurable development plan for the employee. A new
performance management system is being developed to align performance efforts
for achieving business objectives and to enhance performance ability of all
individuals.

The new Career Progression Plan is significantly different from the old system.
Individual's skills, performance and contribution instead of service requirements
are emphasized. Besidesthe new Career Progression Plan places emphasis on
external competitiveness, as well as control via bottom-line, budgeting approach
and headcount budget

Development of the new Career Progression Plan was a joint effort between line
managers, Human Resources and Training & Development.

Training &

Development was responsible for development of assessment tools.

Human

Resources collected information on market practices regarding career structures

of different streamsconducted company-wide communication of the Plan, and
conducted costing analysis. Line managers were responsible for specifying job
responsibilities of different career steps, identifying skills requirements for
different career stepsassessment and development of employeeas well as
communications to employees.

The new Career Progression Plan was introduced by 2 phases. The first phase
was introduced in February 1994 and was the pilot run for front-line customer

86

service staff. The second phase was the roll out of plan to all other employees in
January 1995.

Throughout the whole planning and implementation process,

communication with employees and line managers and their inputs were
emphasized.

A number of practical issues were identified, including absence of target staff

distribution templatesno established monitoring, control and maintenance
mechanisms, weak link between new Career Progression Plan and performance
management/ reward systemas well as little line managers' ownership of the Plan.

87

CHAPTER 6 T H E

CASE

STUDY

- RESHAPING,

RETRAINING AND

REDEPLOYMENT PROGRAMME

On March 271991around 1,100 employees were declared redundant and laidoff immediately, without advance notice or prior communication from
management. This March 27 Event' is well-known to the Company's staff and
the general public.

Since then, around March every year, there were rumours and speculation that
the Company would make another massive job cut. This yearit was rumoured
that the Company will cut 4500 jobs due to merging of Hongkong Telecom with
another Group Company HK Telecom CSL, and saving in manpower
requirements after full digitalization of the network. Also, there would be plan
for compulsory redundancies.

On March 101995Linus Cheung, the Chief Executive held a briefing session

on the Company's 5-year business plan. Hundreds of line managers and Joint
Staff Council Representatives were invited to the briefing session. Many of them
expected that something related to the rumours would be announced.

In the briefing session, rumours and speculation were brought to an end. It was
announced that the Company planned to reduce the manpower level from 16,000
to 14,700 by end of March 1996. There would be a further reduction of 1,200
jobs to achieve total headcount of 13,500 by March 1998. To achieve this, a
company-wide reshapingretraining and redeployment programme would be
introduced.

To ensure that this message and the underlying reasons could be clearly
communicated to all staffa memo for Linus Cheung was sent to all staff and all
line managers needed to brief their staff on the Company plan and the specific
plan for their areas within 3 working days.

88

After the announcement, the Reshaping Task Force which is responsible for
ensuring the effective reshapingretraining and redeployment to be carried out so
that the right balance of skills and resources can be maintained whilst overall
manpower numbers can be reduced was formed. The Reshaping Task Force has
developed the redeployment strategy and policy as well as the Implementation
Guide which outlines the principles and procedures in implementing the exercise.
Besidesit has drawn up the macro manpower plan from which major surplus and
shortfall areas were identified, and retraining/ redeployment plans were
developed and implemented.

Different communication channels were employed throughout the whole process

t o ensure its transparency. Besides, the process is being closely monitored by the
Reshaping Task Force.

In the following sections, an overview of the reshaping, retraining and

redeployment process will first be discussed. Then, different critical components
of the programme, including briefing session held by Linus Cheung, the
Reshaping Task Force, the redeployment strategy and policythe Implementation
Guide and communications channels adopted throughout the processwould be
examined.

Finally, concerns of line managers and staffthe progress of the

programmethe projection of the manpower situation by end March 96 will also

be discussed.
6

Ovprview ofth^ Reshaping. Retraining and Redeployment Process

The whole reshaping, retraining and redeployment process starts with the
development of the macro manpower plan. The macro manpower plan describes
the existing distribution of manpower by functions and grades and the respective
headcount target figures to be achieved by end of March 96.
The drawing up of the macro manpower plan is based on the target headcount
figures in business plans which are submitted by functional managers before

89

beginning of each financial year. The target headcount figures are set as part of
the Company's long-term business planstaking into account business
projections, investment plans in new business areas as well as productivity
improvement programmes.

By incorporating wastage projectionthe projected staff strength as at end of

financial year will be found. By comparing this figure with the target headcount
figure, surplus or shortfall by function and grade can be found.

Once surplus and shortfall areas are identified, all available career opportunities
in shortfall areas will be advertised in the internal vacancy notice. All staff are
welcome to apply for voluntary transfer.

If the application is successful,

retraining programmes will then be arranged by the gaining area managers.

When the number of successful voluntary transfers is not sufficient to reduce

surplus or shortfall in a particular area, more guided approach of redeployment is
required. Surplus areas' managers need to develop retraining and redeployment
plans in consultation with gaining areas' managersHuman Resources and
Training & Development. The retraining and redeployment plans include the
number, career streams and grades of the surplus staff as well as the time frame
for releasing of staff and retraining requirements.

Retraining programmesranges from on-the-job training to tailor-made skills

trainingwill then be organized. Types of training programmes required depend
on the gap between the skills possessed by the staff concerned and the skills
requirements in the gaining areas. For exampleretraining for staff transferred
from Customer Service - Technical stream to Administration stream will be more
extensive than that for staff transferred from one Engineering function to another.
The retraining programmes can be arranged for staff either before or after
transfer t o the new jobs.

90

The whole implementation process followed the principles and procedures laid
down in the redeployment policy and the Implementation Guide. The progress
was being monitored by the Reshaping Task Force. Adjustments to plan would
be made as and when necessary.

The whole reshapingretraining and redeployment process can be summarized as

in Exhibit 12.

6.2,

The Briefing Session

The atmosphere of the briefing session was positive and sincere.

It was

positioned as an opportunity to seek trust and support from both line managers
and staff

Linus Cheung began the session with the Company's mission, the anticipated
changes in business environment and its impacts on the Company in the coming 5
years.

The Company's mission is - To be the most successful telecommunications

company in Asia. As the Company stands on a threshold of tough competitive
challenges and exciting opportunities, we must take fixll advantage of the
opportunities which exist. To realize the mission, we must continually review the
way we do business.

This will mean that what we did yesterday and the way we did it may not be
applicable for tomorrow. So we must continue to improve operating efficiencies
through leaner and more efficient organization, and employing latest technology.
We must also continue to build on our strengths and explore new opportunities.
The whole management teamsupported by the input of many of you through
various initiatives and the five-year rolling forecast plans, believe this is the right
strategy to move the Company forward.

91

Business needs,
including requirements
in new business areas

Productivity
improvements

Redeployment
Strategy/Policy
Business Plan
-Headcount target
Implementation
Guide
Projected wastage
based on past
pattern

Monitoring

Macro Manpower Plan

Implementation

Voluntary
transfer of
staff

Identification of surplus/
shortfall areas, including
career streams and grades
being affected

Development of retraining and

redeployment plans by surplus
areas' managersin
consultation with gaining
areas' managers and Human
Resources

Retraining programmes
Exhibit 12: Overview of Reshaping, Retraining and Redeployment Process

92

Hongkong Telecom does face tough challenges: revenue growth is affected by

intensifying local and global competition, IDD tariff reductions and the restriction
on price increase on local services by the CPI-4% formula. At the same time we
have substantial opportunities to invest in new business areas such as Video On
Demands (VOD) and other interactive Multimedia Services (IMS), and we are
bidding for licences for Personal Communications Services (PCS) and Cordless
Access Services (CAS) in Hong Kong and a range of opportunities in China and
the Region.

To achieve the mission, we need to strive to invest in new business areas, grow
revenue and reduce unit costs. We can grow revenue by increasing standards of
customer servicelaunching effective marketing programmes and introducing
new services and products within a short time. While for reducing costswe
have to adopt more efficient systems and processeseliminate unnecessary
activities and benchmark the best practices in class worldwide. We have been
working on this for some time and will need to continue and accelerate the
programmes we have begun.

Following this strategywe need to make substantial investment in new systems

and technology to provide efficient tools for serving customer needs and to
enable staff to achieve higher productivity. There will be emphasis on keeping
skills up to date and continuously improving performance.

We also need to reduce the overall number of jobs in our existing business areas
and create new jobs by investment in new business areas.

We now have 16,000 staffwhom some 2,000 leave each year as part of normal
staff turnover. We will continue to tightly control recruitment t o allow numbers
to gradually reduce. We will set up a special Reshaping Task Force for effective
retraining and redeployment to maintain the right balance of skills and to ensure

93

resources correctly positioned to meet customer needs.

We plan to reduce

manpower level to 14,700 between now and the end of March 1996a net
reduction of 1,300 jobs over the period.

Beyond March 1996, we anticipate a further net reduction of 1,200 jobs resulting
in an overall manpower level of 13,500 by March 1998. Exact numbers will of
course depend on impact of competition, and the rate of growth of opportunities
in new business areas. This further reduction of 1,200 jobs will also be achieved
through normal staff turnover and investment in retraining and redeployment.

Let me stress once more that the Company has no plan for any compulsory
redundancies and it is the Company's objective to avoid to take such a step. We
firmly believe we can reach our manpower targets by not replacing every person
who leaves the Company, by retraining and redeploying staff and by voluntary
measures. We will consider voluntary measures in specific areas if normal staff
turnover and redeployment are insufficient to meet the target

The Company will continue its caring approach in managing this reshaping,
retraining and redeployment process.

We will keep the whole process

transparent to all. We will continue to communicate with you on a regular basis

and keep you informed of the progress and any changes which may affect you
and answer any questions as they arise.

You are welcome to provide feedback and inputs related to the process to us
through your managers or Joint Staff Council Representatives. I firmly believe
that with your help we can create a better company, and I know that I can count
on your support

6.3.

The Reshaping Task Force

After the announcement on March 101995Reshaping Task Force was formed.

Its main purpose is to ensure the effective reshapingretraining and redeployment

94

are carried out so that the right balance of skills and resources can be maintained
whilst overall manpower numbers reduce.

The Reshaping Task Force consists of a full time Task Force Coordinator who is
a senior manager in Human Resources reporting to Director of Human
Resources, and seven senior managers from major surplus/ shortfall areas. There
is a small team reporting to Task Force Coordinator which provides support to
Task Force members.

The Task Force works closely with Training &

Development and the Human Resources Services and Corporate Human

Resources Teams and draws fully on their resources.

The role of the Task Force is to provide company wide coordination, advice and
support to establish a framework within which line managers, supported by
Human Resources, can progressively manage their manpower resources to
achieve service, revenue and cost targets. This framework ensures a caring and
professional approach for any staff affected by the reshaping, retraining and
redeployment process. Its prime objectives are:

To translate the reshaping, retraining and redeployment strategy/ policy

into procedures and practices.

To consolidate the long-term manpower planshighlighting shortfalls and

surpluses and to recommend appropriate courses of action for
Management considerations.

To oversee retraining programmes to ensure that the right level of

support from the Company is available.

To contribute in the areas of organization design with the aim of

improving management efficiency.

The Task Force regularly monitors and reports on progressadjusts plans and
programmes as necessary, and in due course identifies whether any areas should
open up voluntary redundancy programmes. It is also responsible to ensure that
staff are well informed of the latest development.

95

6.4.

Redeployment Strategy

The Reshaping Task Force proposed the following redeployment strategy which
was endorsed by top management.

Redeployment should be positioned as follows:

It is a process of distributing human resources and skills in an optimum

way to achieve the Company's business objectives. It is NOT the means
to get rid of poor performers.

All parties have to give a share to make the plan successful.

Line

managers are responsible for managing the process o f achieving the

manpower targets, while the Reshaping Task Force, Human Resources
and Training & Development will provide the framework and services to
assist.
-

Employee's expectation/ speculation about voluntary redundancy should

be managed.

Voluntary redundancy will only be the last resort, and

should not be mentioned in the early stage of the process.

Assuming a clear and detailed manpower plan, it was proposed that the approach
to redeployment should be:

Criteria for Selection

Identification of employees for redeployment and placement to specific

job vacancies is based on skillsexperience and potential for retraining/
redeployment for the particular job.

From Soft to Hard

As a first stepinvite employees to volunteer for redeployment from areas

with manpower reduction to specific job opportunities in other functions.

96

Subsequently move to a more directed approachwith line managers

nominating employees for redeployment based on the criteria mentioned
above.

6.5.

Redeployment Policy

Based on the redeployment strategy endorsed by the top managementa

Redeployment Policy was formulated and communicated to staff members
through line managersJoint Staff Council Representatives and notice boards in
late March 1995.

This Redeployment Policy formed the basis for the

development of Implementation Guide which gave details of principles and

procedures in implementing the exercise.

The Philosophies

It is the Company's aim to retain and develop high quality employees to meet
customers' needs and contribute to business growth. However, where there are
changes in the job requirements, organization structure, work processes or
business opportunities, the number of employees needed in a particular area may
change. The type and/or level of skills required of a particular job may also vary.

The Company will seek to manage these changes through normal staff turnover
and retraining so as to minimize the impact on its employees and the business.
Where there is a need for redeployment, the Company will use it as an
opportunity for employees to broaden their skills and experience, and thereby to
better develop their career.

In the redeployment processthe Company will manage the situation and the
employees in a fairconsistentobjective and supportive manner.

97

Manpower Planning

The Company will review its manpower plans on a regular basis to identify
surpluses and shortfalls.

Where there is a need to redeploy a group of

employeesthe Company will plan and implement retraining and redeployment

programmes in a systematic and proactive manner so as to minimize the impact
on employees.

Criteria for Identifying Employees for Redeployment

A redeployment situation may arise when, due to changes in technology or

business need:

the number of employees required for a particular job or function is

reduced, or

the nature of a particular job has substantially changed so that the existing
job holder no longer has the necessary skills to perform the job.

In areas where there is a need for redeployment, employees to be redeployed will

be identified by managersassisted by Human Resources. Identification will be
based on skills, experience and potential for retraining and redeployment.
Employees will also be invited to volunteer for alternative job opportunities
within the Company for which they consider themselves suitable.

The Company will take into account the need to retain a balanced workforce to
enable the business to continue effectively.

The redeployment process is not meant to be a mechanism for dealing with

employees with performance issues.

While retraining may be helpful in

correcting performance problemsmanagers will closely manage these cases on

an ongoing basis as a separate process.

98

Communication and Consultation

Employees will be informed of the need for redeployment in their area, suitable
alternative employment opportunities as well as other options in a timely manner.
They will also be consulted before and during the redeployment process.

Placement Process

Once a job vacancy becomes available within the Companya skills matching
process will be conducted amongst the employees who have volunteered or been
identified for redeployment.

Where the number of suitable candidates for a position is more than required, a
selection process will be conducted by a panel chaired by the manager of the
position and with representation from Human Resources.

Once the Company identifies suitable alternative employmentan offer will be

made to the employee. Where the employee decides to reject the offerhe/she
will give clear explanations for the decisions.

In filling any vacant positions within the Companyemployees identified for

redeployment who meet the requirements of these jobs will be given priority.
External recruitment will not be allowed until it is proven that no internal
candidate is qualified or retrainable for the vacant position within a reasonable
period.

Retraining

For employees to be redeployedthe Company will provide appropriate retraining

to assist them in seeking alternative job opportunities within the Company. Such
retraining may be in the form of classroom courses or on-the-job training.

99

Once the employee accepts an alternative job offered by the Company, the
manager will arrange retraining opportunities to assist the employee in learning
new skills and knowledge required by the job. The manager will also provide
coaching and assistance to support the employee in adapting to the new job
environment.

Terms and Conditions Upon Redeployment

There will not be any reduction in salary and benefits of employees upon
redeployment.

Progression of redeployed employees will be assessed and managed in the usual

manner.

Counseling Service

Employees may make use of the Employee Counseling Service provided by the
Company when dealing with any possible issues or difficulties in adjusting in the
new job.

Appeal

Employees who wish to complain about any aspect of the redeployment process
may do so to the next higher level of management along the line of authority, and
if necessaryto Human Resources.

Investigation into their claims will be

conducted in a fair and objective manner.

6.6.

Implementation Guide

The Implementation Guide was issued on May 51995.

managers

and

supervisors

in

It aims to assist

managing the reshapingretraining

and

redeployment process. It covers principles and procedures in implementing the

100

exercise, the responsibilities of various parties in the process, as well as the

support the Company provides to these parties. It was developed based on the
Redeployment Policy and the input of Joint Staff Council Representatives
employees and line managers collected through different communication
channels. This process itself reflected the Company's commitment to adopting a
caring and professional approach with open communication and consultation.

Manpower Planning and Identification of Shortfall/Surplus

The Reshaping Task Force will, together with respective line managers and
Human Resources, review the approved manpower plans on a quarterly basis,
taking into account the staff turnover trend, the impact of competition and the
rate of growth of opportunities in the new business areas. Areas with either
shortfall or surplus will be identified.

This information, as well as skills

requirement of the areas with shortfall, will be communicated to staff.

Line managers will manage their manpower levels through normal staff turnover.
However, there may be some cases where shortfalls/surpluses will be identified
and handled as follows:

In Case of Shortfall

The Company will try to source the required skills within the Group
through internal transfers (primarily from areas where there are surpluses)
and in-house training to build up the new skills set.

The available vacancies will be advertised internally for open applications.

Priority will be given to staff from surplus areas for horizontal transfer.

External recruitment will not be considered until it is proven that no

internal candidate is qualified or trainable for the available position. Prior
approval from top management members is required.

101

In Case of Surplus

Where it is anticipated that normal staff turnover will not be sufficient in

achieving the manpower targetline managers will inform their staff of the
situation and encourage them to proactively apply for job vacancies
outside their own area. They will at the same time work actively with
Human Resources to identify career opportunities for their staff.

Redeployment Process

Communication to Employees

Once the manpower plan has been approved by Management, line

managers will inform their staff of the following:

The number and type of jobs to be reduced and how this will be
achieved - either through normal staff turnover or redeployment.

The time frame to meet manpower targets.

The relevant career opportunities in the Company.

Voluntary Application

Staff are encouraged to apply for vacancies outside their business area:

They may submit their application directly to Human Resources

without having to go through their line supervisors. They may
also request their supervisors to give recommendation in their
application. Acknowledgment receipts will be sent to applicants
via their supervisors.

Once all applications have been received, a skills matching process

will be conducted by the gaining party. If the number of suitable

102

candidates for a position exceeds the requirement, a selection

panel chaired by the gaining party together with representation
from Human Resources will be conducted.

Offers will normally be made to successful candidates within 4

weeks from the closing date of the vacancy notice. The gaining
area will liaise with the releasing party on the date of release
(normally within 1 month).

Unsuccessful candidates will be

notified according to normal procedures.

-

Staff from surplus areas volunteered for transfer will be given a

trial period of up to 3 months. Those who ultimately found the
new role unsuitable may request for reverting back to the
releasing areas, or seeking alternative career opportunities within
the Company. Such a request will be thoroughly considered and
be supported where practically possible.

Unsuccessfol applicants will not be discriminated.

Directed Redeployment
Staff will be directed for redeployment by line management if:

business requirement.
-

the number of successful voluntary transfers falls short of

manpower reduction.

Once an area has been identified for directed redeployment the following
process applies:

103

The line manager will advise their staff of the selection criteria
which, depending on circumstances, are based on all or a
combination of the following:

transferability of skills and knowledge

potential for retraining

adaptability to changing needs

The profile of those staff identified for redeployment will be

matched against the available vacancies by line managers from
both the gaining and releasing areawith the support of Human
Resources. Once a suitable job has been identifiedan offer will
be made to the selected staff member.

As the redeployment offer is based on a thorough job/ skills matching

process staff are not expected to decline it.

Where they consider

themselves having reasonable grounds to decline the offerthey may raise

their concerns to their line managers.

To ensure that a redeployed staff member adapts t o the new job, followup reviews between releasing and gaining line mangers will be conducted
in the initial period after redeployment.

Placement Process

Immediately after the transfer, the line manager of the gaining

party will brief the redeployed staff member on his new roles
responsibilities, key objectives and training arrangements.

The redeployed staff member should try his best to acquire the
required skills and adapt to the new environment. He should seek
help from his supervisor if difficulties are encountered.

104

If the gaining manager considers the redeployed staff member not

suitable for reasons other than performance, he is required to
submit a written report with reasons for the decision to Human
Resources.

Training Support

In the reshaping, retraining and redeployment exercise, training forms an integral

part and plays a vital role throughout the process.

For Staff

For staff who may benefit from support in relation to potential

career changes, a Career Planning Workshop can be arranged.
This 1-day Workshop helps staff who are considering a career
move to review themselves and their environment so as to make
effective career decisions and plan for action.

The Workshop

includes:

Taking Stock:

Learning about own selfexploring

strengths and weaknesses and personal goals.

-

Opening up and Assessing Career Options: Exploring the

business environment and understanding future skill
requirements.

Developing a Career Action Plan: Deciding on a direction

and development needs and formulating an action plan.

In preparing staff who are making an imminent career movea

half-day Career Management Seminar may be offered. It assists
them in understanding the impact of change in business
environment on their career and what they can do to help
themselves throughout the change. The Seminar discusses:

105

Importance of Career Development

Examples of world-wide trends in business management

and career development.

Why and how to take personal responsibility in career

management in the midst of change.

Career opportunities and challenges in the Group,

Staff who voluntarily transfer or are redeployed to a new job will

be provided with the following training support:

an orientation to the job and its environment to assist them

in adapting to the new role and the work team;

customized skills training programmes in the relevant area

such as technical, customer service and selling;

on-the-job training and coaching to ensure satisfactory

application of the new skills.

For Supervisors

For supervisors in the gaining areas, briefings on the process and

techniques in orientating new staffdeveloping a positive team
climate and guiding new members on the job will be arranged.
This will help create an environment for staff upon transfer/
redeployment to:

effectively integrate with the existing work team;

acquire new skills and knowledge to meet the requirement

for the job; and

feel that their initiative in making the move is being

recognized.

106

For supervisors in the releasing areas, briefings will be arranged to

assist them in understanding:

the

implementation

process and

their

roles

and

responsibilities in it;
-

the process by which they should identify staff for specific

job opportunities;

the skills in guiding staff in making a career move; and

the training and support services available.

Career Care Services

Career Care Services, provided by Training & Developmentare aimed at

offering guidance and support to staff in taking ownership of their careers, and in
facilitating their career decisions. There are three areas of service:

Career Training

The training courses on career management are already outlined before.

Staff interested in these courses may bring to the attention of their
supervisor. Where a particular staff member may benefit from any of
these courses, the supervisor may also arrange for him/her to attend.

Career Information Service

Training & Development will co-ordinate a series of briefings on and

visits to areas requiring additional staff resources. This aims to enable
staff who are considering making a career change to acquire an early
understanding ofjob environment and skills requirement of these areas.

107

The following are also available:

Career related booksarticles and videos.

Full set of internal vacancy notices.

Full set of Performance Anchor Forms/ Competency Assessment

and Development Forms which outline the competency/ skill
requirements ofjobs of different career steps and streams.

Career Counseling Service

The Career Counseling Service enhances decision making in career

development/ change and to offer support and advice around concerns
about career transition.

This in-house counseling service will provide one-to-one discussion

sessions on career planning and development.

The discussion will be

conducted in a strictly confidential manner and the content will not be

disclosed to any party without consent from the staff member concerned.
The process may include:

Identifying and discussing of career issues.

Use of professional tools to find out personality and career

motivation.

Review of key skills and aptitude.

Gathering information on alternatives.

Development of career plan.

Establishing steps to progress the career plan.

Dealing with Employees with Performance Issues

The reshapingretraining and redeployment programme is not meant to be a

mechanism for dealing with employees with performance issues.

108

While retraining may help correct performance problemsline managers in

consultation with Human Resources will need to closely monitor these cases and
recommend appropriate courses of action.

Human Resources can provide

guidelines on the management of under-performance for line managers

reference.

Performance Review

Under normal circumstances, the annual performance review of any staff member
should reflect his performance of the entire year if he was already employed by
the Company at the beginning of the review period. This principle should be
followed in the transfer and redeployment process.

Before the transfer is effectedthe releasing manager should conduct a

performance review of the staff member for the period under his supervision.
The relevant completed Performance Anchor/ Competency Assessment and
Development Form with review of achievement against agreed goals/targets will
be forwarded to the gaining manager.

By end March of the year, the performance reviews completed by both the
releasing and gaining managers will be considered in deciding on the overall
performance rating. The gaining manager should ensure that the staff member's
contribution and efforts made during the entire review period are fairly reflected
in the overall performance review and its rating. Efforts and progress in learning
new skills and knowledge should be taken into account in completing the
performance review.

109

Terms and Conditions of Employment

Staff who are transferred to position in the same career stream will remain at
their current career step without any change in their employment terms and
conditions.

In case of cross stream transfer, the staff will be appointed horizontally to an

equivalent career step with no reduction in salary and benefits. They will follow
the salary structure of the new career stream and their progression will be
managed in the usual manner.

Communication and Feedback

The Company sees the success of the reshaping, retraining and redeployment
programme relies much on the effective communication with staff of all levels
throughout the process.

The Reshaping Task Force will assist Management in communicating the

progress of the reshaping, retraining and redeployment programme to staff on a
quarterly basis. Questions and Answers Bulletins will be published where
necessary to clarify issues and answer queries raised by staff

Line manager will manage the communication with staff in their own areas. They
will ensure their staff are sufficiently briefed from time to time on the progress of
the programme in their area. They will also answer any queries staff may have,
and address any issues and concerns perceived by staff in a responsive manner.

Appeal
Staff who wish to discuss their concerns or complain about the outcome and/or
any aspect of the reshapingretraining and redeployment process may approach

110

their line manager who is in the best position to answer any queries.

Line

manager will respond within one week.

If a staff member is not satisfied with his line manager's reply, he may approach
the next higher level of management along the line of authority and, if necessary,
to Human Resources. He may also approach Human Resources through the
hotline.

Upon receipt of a complaint, Human Resources will look into the case with
respective line management in addressing the issue raised and providing a reply to
the staff member concerned.

Should the above mechanism fail to settle the case, staff may appeal to the
Reshaping Task Force through the Hotline. The Task Force will report to top
management on appeal cases.

Communications

As mentioned by Linus Cheung, the ReshapingRetraining and Redeployment

Programme is transparent to all and to be carried out in a caring manner.
Communication among top managementline managers and staff is hence very
important. Communication ensures that:

all parties concerned get the right message and clear understanding of the
principles and objectives of the programme;

concerns of relevant parties are taken into account in determining the

implementation principlesthus involvement and commitment can be
gained from them and obstacles in implementation can be minimized;

trust and support from line managers and staff can be built;

uncertainties and fears can be relieved.

Since the announcement of the programme on March 10 1995 various

communications channels have been employed to provide information about the
programme to staffcollect inputs and feedback from line managers and staff,
provide information of career opportunities to staffclarify staffs and line
managers' concerns, win support from relevant partiesreport the progress, etc.

Briefing Sessions to All Staff

After attending the briefing session held by Linus Cheung, all line managers were
requested to brief all staff under their areas on the Reshaping, Retraining and
Redeployment Programme within 3 working days. To ensure that all people get
the same message, a set of standard presentation materials was prepared for line
managers. Line managers were requested to do the briefing themselves as far as
possible. They are also requested to complete a response form for each briefing
session, summarizing the main commentsconcerns and feedback collected from
staff To relieve uncertainties and fears of staffline managers also gave their
staff indication of business/manpower plans for the area.

Tea Gatherings

Thousands of staff attended Tea Gatherings hosted by Linus Cheung and other
members of the Management Board which were held soon after Linus's briefing
session. In the Tea Gatherings, staff had direct dialogue with top management.
Top management told staff the objectives and details of the programme while
staff voiced out their fearsconcerns and provided suggestions. Through these
occasionscredibility of the programme was enhanced while staffs fears and
uncertainties were much relieved. Support and trust were also built.

Regular Questions and Answers Bulletins

Questions and Answers Bulletins, summarizing progress of the programme,

concerns of various parties and clarifications from managementwere issued

112

regularly to all staff. Through the Bulletins, staff could get more information
about the programmes while management could reinforce the message and clarify
its position.

ReshapingRetraining and Redeployment Communication Pack

In early May 1995C3R' Communication Packs were distributed to all staff. The
pack contained a covering memo from Director of Human Resources, a
Highlights of the Implementation Guide and a Macro Manpower Plan - 1995/96.

The Highlights of the Implementation Guide summarized the Implementation

Guide which were distributed to all line managers and Joint Staff Council
Representatives.

The Macro Manpower Plan 1995/96 described the overall

manpower picture as of end of April 1995 and highlighted the major shortfall/
surplus areas identified from the manpower analysis, the projected net surplus/
manpower requirements and the career streams being affected.

Focus Groups For Line Managers

In order to ensure that views and concerns of line managers were incorporated
into the determination of detailed implementation guideline and support from line
managers was gained, a series of focus group sessions for line managers were
held. During the focus group sessions, line managers were first briefed on the
draft of the Implementation Guide. They were then asked to raise their concerns
and foreseeable issues regarding the implementation process. The sessions were
fruitful and the Implementation Guide was revised based on inputs from line
managers, staff representatives and staff members.

Road Shows on Career Opportunities

Road Shows on career opportunities in major shortfall areaslike Mobile

Business and Interactive Multimedia Serviceswere held. Over a thousand of

113

staffmainly from surplus areas, have attended the Road Shows. In the Road
Showssenior managers briefed staff on the function, the working environment
as well as the job nature and skills requirements of the available career
opportunities. With such information, staff could consider whether the jobs were
suitable for them and if so, proactively prepare themselves for the transfer to
these areas.

Video

Since the announcement of the programme by Linus Cheungtwo videos have

been produced. The first video was broadcasted to all staff in staff canteens in
April, soon after the announcement.

This video aimed at reinforcing the

messageexplaining the background and objectives of the programme, enhancing

credibility of the programme, building up confidence of staff as well as seeking
support from both line managers and staff. In the videoLinus Cheung and,
Deputy Chief Executive, briefed the background of programme, the rationale and
the policy to be adopted.

Once again, the principle of no compulsory

redundancy' was emphasized.

The second video was broadcasted in early July during the implementation phase
of the programme. The main theme of the second video was different from the
first one. The major purposes of this video were to maintain the momentum of
the programme, to highlight issues experienced by both line managers and staff in
the implementation phase and to cite some cases of staff who were transferred
during the programme. In the video, Director of Human Resources, Mobile
Directorand Managing Director, Corporate Development and Operations
described the progress of the programme, highlighted the concerns of both line
managers and staffexplained to line managers how they could perceive the
programme as an opportunity to improve their business performance and
encouraged staff to support the programme.

Three of the staff who were

voluntarily transferred to another fonction and were undergoing tailor-made skills

training programmes were interviewed.

114

They shared their feelingswhat they

gained from programme and how they perceived the Reshaping, Retraining and
Redeployment Programme offered them opportunities to broaden their skills and
experience as well as to develop their careers.

Before the company-wide broadcastingJoint Staff Council representatives, top

management members and interested staff members were invited to a preview
session in which they could discuss their concerns with and provide their
feedback and comments to Reshaping Task Force members. Such opportunities
for direct communication could enhance mutual understanding and help improve
the implementation process.

Formal and Informal Meetings with Joint Staff Council Representatives

The success of the Reshaping, Retraining and Redeployment Programme rested
much on the support from staff members. As Joint Staff Council is the formal
communication channel between management and staff, and the Joint Staff
Council Representatives are influential to staff members, it was necessary to
ensure that support to the ReshapingRetraining and Redeployment Programme
was gained from them. Therefore, a series of formal and informal meetings were
held to collect their feedback and to keep them informed of the progress.

Hotline and Hotfax

As it is stressed that a caring and professional approach should be adopted during

the whole process, channels for staff members to raise their concerns were very
important. A number of hotlines and hotfax addressing to Human Resources
Reshaping Task Force and Training & Development were set up.

6.8.

Employees? and Line Managers' Concerns

Since the announcement on March 101995line mangers and employees have

aired their concerns about different policy and implementation issues through
different channels throughout the process.

115

These range from impacts on

individual to impacts on business performance.

Most of the concerns were

addressed and taken into account in drawing up the redeployment policy and
Implementation Guide.
EmployeesConcerns

Appeal Mechanism

Employees were much concerned about whether they would be

treated fairly in the process.

It was necessary to have an

independent party responsible for handling appeal cases.

-

Joint Staff Council Representatives would like to participate in the

appeal process and be members of the appeal panel

Performance Review

performance and contribution would probably be affected.

Besidesthey might be discriminated by the line managers and be
given a poor performance rating. It would be fair and objective to
take into account their performance in the previous function
before transfer. Otherwise, their pay increase would be adversely
affected.
-

Selection Criteria for Redeployment

Older employees with lower qualifications and be less retrainable

might be discriminated against in the selection for redeployment,

Selection criteria for redeployment should be fair and objective

not based on 'personal preferenceof line managers concerned.

Those who were being viewed as poor performers' by line

managers might first be identified to be got rid of.

116

Pay & Benefits After Redeployment

-

When staff transferred to another career stream, the salary range

might be lower than their current one. Their salary might be
frozen and the future salary increase might be restricted.

Working hours might be longer than the current one. Therefore,

the salary would be relatively lower as compared with the past.

Staff who currently joined incentive scheme might experience

significant reduction in take home pay if they transferred to a new
post where there was no incentive scheme or they might take a
long time to improve their skills so as to achieve the performance
targets.

Retraining
-

Employees were very much concerned about whether the

Company would provide sufficient retraining programmes and the
new supervisors would provide coaching so that they could be
able to acquire the new skills and perform well.

As most of the affected employees possessed skills specific to

their existing function, they believed that it was not easy to apply
for transfer to other functions successfully. They hence suggested
that the Company should provide general skills training before
transfer,

like

customer

service,

selling

techniques

and

administrative skills so that the chance for successful transfer

might be greater.

Progress of the Programme

-

In order to maintain the transparency of the programmethe

Company should regularly update employees on the latest
progress and development. Such information should include the

117

latest manpower level, turnover statistics and the manpower

targets of different areas.

Application for Transfer

-

Employees were afraid that their supervisors would blocktheir

applications for transfer.

Those younger employees with higher qualifications and more

transferable skills might have a greater chance of successful
transfer to high growth business areas.

These staff would

probably not come from major surplus areas.

Promotion Prospects

As the surplus areas were shrinking, the promotion prospects for

remaining staff would be adversely affected.

For employees already in

shortfall areas, their promotion

prospects might be diluted by the influx of redeployed employees.

While for the redeployed staffthey perceived that there would be
little chance for promotion as their performance might not be as
well as the existing employees.

Voluntary/ Compulsory Redundancy

Employeesespecially those from major surplus areaswere much

concerned about whether the voluntary/compulsory redundancy
lists had been compiled and how employees were selected.

If it was decided to offer voluntary/ compulsory redundancythe

Company should inform affected employees the timing and
package well in advance.

118

Increased Workload

greatly as the manpower level was reduced by redeployment of

employees out. Employees felt that it was unfair to them as there
would be no compensation for increase in workload.

Trial Period
-

Transferred staff should be given trial period so that they could

assess whether the new job was suitable to them and their
supervisor could assess their performance. If it was found that
there was a mismatch, opportunity to revert to original function
should be offered.

Line Managers' Concerns

Performance Management
-

As it was likely that poor performers would remain in surplus

areas, it would be increasingly difficult to

manage their

performance.
-

Line managers in gaining areas might find difficulties in managing

performance of new comers and existing employees who might
share additional workload with new comers.

Achievement of Targets with Reduced Manpower

-

Line managers from surplus areas experienced difficulties in

achieving

ever

increasing

business

targets

with

reduced

manpower. Howeverthe progress of productivity improvement

programmes was usually out of their control.

119

Employees Transferred Out from Neutral Areas/ Shortfall Areas

"

Line managers in neutral areas and shortfall areas perceived that

their business performance would be adversely affected when the
experienced high performers voluntarily transferred out to high
growth areas and recmitment was frozen. Line managers viewed
that the shortfall situation would be worsen and more difficult to
manage.

6.9.

Progress and Projection bv End March 1996

Since the announcement on March 101995actions have been taken to
encourage staff from surplus areas to apply for transfer to shortfall areas.
Besides, external recmitment and replacement for leavers were under tight
control Vacant positions could be filled only when it was essential to business
operations. All vacant positions were advertised internally. External recruitment
could be proceeded only when it was proved that there was no suitable internal
candidates who possess the required skills and approval from members of top
management team was obtained. It was to ensure that existing staff were given
priority in available career opportunities.

6.9.1. Progress UP to End June 1995

As at 30 June 1995the total headcount was around 15500 and around 800
above the target headcount of 14,700 for end of this financial year. A total of
480 employees left the Company while 150 joined during April to June.

Since Aprila total of 560 positions have been advertised, most of which were in
major shortfall areaslike Mobile Business, ISA, Sales and Marketing. A total
of 1430 applications were received and 180 appointments were made. Only 710
applications were from surplus staff while 90 offers were made to them.

120

6.9.2. Projection of Status by End March 1996

Assuming that turnover maintains at the current rate and there will be no external
recruitmentthe projected headcount for the following 3 quarters in this financial
year will be below the Business Plan figures. Howeverif the current external
intake rate of about 50 per month is maintained, the projected headcount for the
third and fourth quarters will be above the Business Plan figures. Therefore
tight control on external recruitment is essential to ensure that the headcount
target can be achieved.

Although the headcount target can be achieved if external recmitment is tightly

controlit cannot be achieved on the qualitative side, i.e.skills mismatch
problems will occur. Based on the assumptions as stated abovethere will be
serious skills mismatch problems at General/Supporting level while shortfall will
occur in all career streams at Professional/Managerial level.

As illustrated

in Exhibit

13the projected surplus

and

shortfall

at

General/Supporting level in Engineering stream largely balance each other out.

There will be great shortfall in Customer Service stream while a great surplus will
occur in Technical Customer Service stream.
Projected Shortfall/Surplus as at 31/3/96
Assuming Current Turnover Rate
Customer Service
Engineering
Administration

Miscellaneous

Supplies
Finance
Mormation Technology

Sales
Customer Service (Tech)

all

Surplus
A

51-100

m
tf tf
Exhibit 13

:11-50
101-20C
201-300

Projected Distribution of Surplus/Shortfall at General/Supporting level as at 31/3/96

121

Extent of shortfall at Professional/Managerial level is even worse. The greatest

shortfall problem will appear in Market/Product Management stream. Expansion
at Professional/Managerial level contributed to 30% of the total shortfall.

6.10.

Issues Identified

The following issues are identified during the implementation stage of the
Programme:

Line Managers' Ownership in the Programme

Many line managers still view that the Reshaping Task Force owns the
Programme and it is the Task Force's responsibility to ensure that all the surplus
staff are redeployed and manpower requirements in growing areas are fulfilled.
However, Reshaping Task Force actually plays a supporting role to facilitate line
managers to achieve their manpower targets.

Line managers should be

responsible for encouraging surplus staff to apply for vacancies in growing areas
developing retraining and redeployment plans for the staff and monitoring the
progress of the Programme in their areas.

Progress of Productivity Improvement Projects

As much of the manpower saved in surplus areas is resulting from productivity

improvementprogress of productivity improvement projects has great impacts on
the progress of the Programme. Currently, many of these projects are not given
priority in development. Top management should gear up the progress of these
projects.

Resistance of Surplus Staff to Transfer Out

At presentmany surplus staff are still not willing to apply for transfer out to other
areas. Some of them are resistant to change, some of them are not confident to

122

acquire new skills and change to another career stream, some of them are not used
to transfer to other areas without promotion, while some of them just wait and
see. If voluntary measures cannot achieve the manpower target, more guided
approach or voluntary redundancy may be required.

6,11.

Summary

On March 101995Linus Cheung, the Chief Executive of the Company,

announced that in facing the tough challenges and opportunities to invest in new
business areasthe Company needed to reduce the overall number of jobs in
existing areas and create new jobs by investment in new business areas.
Manpower level would be reduced by 1,300 to 14,700 by March 1996 and a
further 1,200 by March 1998. It was stressed that the Company had no plan for
compulsory redundancies. Manpower targets would be achieved by not replacing
every person who left the Company, by retraining and redeploying staffand by
voluntary measures.

The whole reshaping, retraining and redeployment process starts with the
development of the macro manpower plan. It is drawn up based on the target
headcount figures in business plansas well as wastage and headcount projection.
By comparing projected staff strength as at end of financial year with the target
figures, surplus or shortfall by function and grade can be found. Actions will be
taken to mobilize staff to transfer from surplus to shortfall areas. Initially, staff in
surplus areas are encouraged to apply for career opportunities in shortfall areas.
If the number of voluntary transfers is insufficient t o reduce surplus or shortfall in
a particular areamore guided approach of redeployment is required.

Surplus

areas managers need to develop retraining and redeployment plans in consultation

with gaining areas managers, Human Resources and Training & Development.
Retraining will be organized for redeployed staff based on individual needs.

A Reshaping Task Force comprising senior managers from major affected areas
and a senior manager from Human Resources was formed. It provides company

123

wide coordination, advice and support to establish a framework within which line
managers, supported by Human Resources and Training & Development, can
progressively manage their manpower resources to achieve targets. It regularly
monitors and reports on progress, adjusts plans and programmes as necessary, in
due course identifies whether any areas should open up voluntary redundancy
programme, and ensures that staff are well informed of the latest development.

Based on the endorsed redeployment strategy and policythe Task Force has
formulated the Implementation Guide in May 1995. It aims t o assist managers
and supervisors in managing the reshapingretraining and redeployment process.
It covers principles and procedures in implementing the exercisethe
responsibilities of various parties in the process, as well as the support the
Company provides to these parties.

The whole Reshaping, Retraining and Redeployment Programme is transparent to

all.

Communication among top management, line managers and staff was

emphasized in the whole process. Various communications channels have been

employed t o provide information about the programme to staffcollect inputs and
feedback from line managers and staffprovide information about career
opportunities to staffclarify staffs and line managers' concerns, win support
from relevant partiesand report progress. These communication channels include
briefing sessions, tea gatherings, regular questions and answers bulletins,
communication packfocus groups for line managers, road shows on career
opportunities, videoformal and informal meetings with Joint Staff Council
representatives, as well as hotline and hotfax.

Through various communication channelsline managers have aired their concerns

about different policy and implementation issues. Most of these concerns were
addressed and taken into account in drawing up the redeployment policy and
Implementation Guide.

124

Employees'

concerns were mainly about

appeal mechanism, fairness of

performance review, selection criteria for redeployment, pay and benefits after
redeploymentretraining programmeprogress of the programme, application
procedures for transferpromotion prospects, details of voluntary/ compulsory
redundancy, trial period allowed after transfer and increased workload of
remaining staff after transfer out of staff in surplus areas. While line managers'
concerns were mainly about performance management of staffachievement of
targets with reduced manpower, and business performance being affected by
transfer out of employees from neutral/ shortfall areas.

Since announcement on March 101995actions have been taken to encourage

staff from surplus areas to apply for transfer to other areas. Besidesexternal
recruitment and replacement for leavers were under tight control. Headcount has
been reduced to about 15500. Assuming that turnover maintains at the current
rate and there will be no external recmitment, the projected headcount for the
following 3 quarters of this financial year will be below the Business Plan figures.
Howeverif the current external intake rate of about 50 per month is maintained,
the projected headcount for the third and fourth quarters will be above the
Business Plan figures. Regarding the qualitative side, there will be skill mismatch
problems at General/Supporting level while shortfall will occur in all career
streams at Professional/ Managerial level at the end of this financial year.

A number of practical issues are identified in the implementation of the Reshaping,

Retraining and Redeployment Programme.

These include poor sense of line

managers' ownership in the Programmeresistance of surplus staff to transfer out

t o growing/ neutral areasas well as impacts of progress of productivity
improvement projects on progress of the Programme.

125

CHAPTER 7 CONCLUSION

Changes in competitive environment have led Hongkong Telecom to review its

business strategies, its sources of competitive advantage and role of human
resources management in contributing to achievement of company strategies.
Externally, the Company is facing the expiiy of franchise and opening up of
telecommunications market which lead to intensifying competition, price is being
controlled by agreements with Government on IDD tariffs reduction and price
increase capping on local services, increasing customer demand which leads to
emphasis on customer service and quality, and limited growth opportunities in
existing business areas but increasing growth opportunities in the region and new
business areas.

Internallythe utility, hierarchical, bureaucratic and traditional culture has

negative impact on future development, the existing competency/ capabilities of
employees may not be able to meet the future requirementsand convergence of
existing 3 group companies requires the review of the existing human resources
practices.
To address these challenges, the Company has launched the Meeting the
Challenge" initiative in May 1992. Company's strengths, weaknessesstrategies
and objectives were critically reviewed and areas where the Company should
excel in and beat competition in the long termi.e. competitive advantages, are
identified. People was identified as one of the competitive advantages. A
"People" Team was then formed to look into various human resources
management issues and see how human resources management can contribute to
future success of the Company. It was necessary to realign human resources
practices and business strategies.

Restructuring of Human Resources function, introduction of New Career

Progression Plan and ReshapingRetraining and Redeployment Programme were
identified as key human resources initiatives to be addressed.

126

Human Resources function has long been playing its traditional administrative and
supportive role in providing human resources services to line managers and
employees. Human Resources professionals usually possess little knowledge of
business needs of clients and deal with human resources issues from narrow
perspective of human resources profession. On the other hand, line managers
focus too much on business issues and bottom-line control, paying too little
attention to people-related issues.

To facilitate the achieving and sustaining of competitive advantage, it is necessary

to integrate human resources processes and business strategies by repositioning
Human Resources as business partners and by creating shared awareness of line
managers and Human Resources professionals.

Currently, too much emphasis is placed on development of technical skills in

traditional business areas and too little on marketing, salescustomer services, and
new business areas. The existing competencies and capabilities of staff may not be
able to meet the future requirements, especially when the Company enters into a
new era of competition and expands into new business areas. Besides, the existing
system is too much internally focused. Introduction of New Career Progression
Plan can address this issue by:
-

establishing an upward linkage to organization's mission and business

strategies.

forging a stronger link between performance, skills and contribution, and

reward so that desirable behaviour and competencies can be sustained.

increasing emphasize on external competition.

delivering new strategic capabilities required in undertaking new business

direction

through

clearly

defined

competencies

and

behaviours

requirements for different career steps and tailor-made training and

development programs to address individual needs.

127

When the Company expands into new business areas like interactive multimedia
servicecordless access services and personal communication services, and with
improvements in productivity in existing business areasthere will be changes in
staffing requirements in terms of headcount and capabilities currently held by the
work force. It is necessary to reshape the existing workforce by mobilizing staff
from existing business areas which will be in surplus to new business areas.
Introduction of the ReshapingRetraining and Redeployment Programme is to
address this.

This can be summarized as follows in Exhibit 14. In introducing and

implementing the 3 initiatives as described in the case studiesthe Company has
made good moves and demonstrated that theories of strategic human resources
management are put into practice.

Align Human Resources Practices and Business Strategies

Many writersincluding Lado & Wilson (1994)Hiltrop (1993) and

Schuler

(1992)have mentioned the importance of aligning human resources practices and

business strategies in building and sustaining organizational capabilities.

In "Meeting the Challenge" initiative, the Company has reviewed its strengths,
weaknessesstrategies and objectives.
competitive advantage.

People is identified as a source of

The three initiatives were introduced to enhance the

synergy between business and human resources strategies.

With the human

resources systems reciprocally integrated with their strategic suprasystems,

effectiveness in development and exploitation of organizational competencies can
be enhanced.

128

Environmental Chanses
Expiry of franchise for local voice service
in July 95 and hence intensifying competition.
Growth opportunities in the region and new
business areas.
Limited growth opportunities in existing
business areas.
IDD tariffs reduction and pricing control
on local voice service.
Increasing customer demand.

Internal Pressures
Utility culture
Hierarchical, bureaucratic and traditional
Efficiency and productivity problems.
Competency /capability of existing
employees.
Convergence of existing 3 group
companies (HK Telecom, HK Telecom
CSL and Computasia)

Telecom

Launched the Meeting the Challenge" initiative in May 1992:

-Focus resources on four key areas which are critical to future success
Market Position
Customer Service
People
Quality Image
-Four Task Force comprising of top management and senior managers were formed to
look into the issues and identify specific actions to be taken.

"People" is regarded as one of the four factors

which are critical to future success of the Company

'People Team' look into various HRM

issues and see how these contribute to
fiiture success.of the Company.

Realign HR practices and business strategies

New HR mission:
T o ensure that HK
Telecom has the human
resources and
organizational capability
to achieve its business
objectives.

Restructuiing of HR
function and
repositioning of HR as
strategic partner,
service provider and
consultant for line
managers.

Alignment of career
progression programme
-Harmonized among 3
group companies.
-Develop individual and
organizational capability to
support future strategies
-Different career structure
for different career streams.
-Continuous assessment
-Focus on skills
performance, contribution
and business needs
-Collaboration between HR
and line managers

Downsizing
-Introduction, of
Reshaping, Retraining
and Redeployment
programme.
-Aim to reduce 1300
headcount by 3/96 and a
flirther 1200 by 3/98
mainly through normal
turnover and
redeployment.
-A special Task Force
comprising of HR rep
and senior managers
from major affected areas
was formed to plan
implement and monitor
progress of the
programme.

Exhibit 14: Linkage Between Business Strategy and Human Resources Management in Hongkong Telecom.

129

As Director of Human Resources became a member of the Management Board

business strategy would no longer be created in isolation and handed down to
Human Resources professionals for implementation. Alignment between strategic
intent and human resources can be built on a shared awareness of long-term
strategic intent.

Reposition Human Resources as Business Partners

Under the new structure of Human Resources function, Human Resources is

positioned as business partners of line managers. Human Resources activities
could be better geared to strategy and goals of the organization.

This is in line

with the arguments of a number of writers, including Hiltrop (1993) and Schuler
and Walker (1990) and the examples demonstrated by Northern Telecom and
AT&T.

Under the new structure, Human Resources Managers report both to Director of
Human Resources and heads of business units. They also participate in clients'
business planning and management meetings.

They become corridor between

business strategy and Human Resources function. As such, Human Resources

professionals could synergize human resources plans and strategic initiative better,
develop good working knowledge of business needs and offer insights into
people-related business issues.

As the role of Human Resources is changing, the Company has redefined the skills
and competency requirements of the Human Resources professionals.

Human

Resources professionals should possess good business knowledge and a broad

perspective as a business partner, and be able to apply Human Resources expertise
creatively and strategically. As a result, a series of development programmes
would be organized for Human Resources professionals.

130

Develop New Career Management System

Hongkong Telecom has demonstrated a good example of developing/ revitalizing

career management system to deliver new strategic capabilities required in
undertaking business redirection as mentioned in the article written by Steele
Bratkovich and Rollins (1990).

As the business environment is changingthe existing individual and organizational

competencies and capabilities could no longer meet the requirements.

The

Company introduced the New Career Progression Plan to the 3 group companies
with an upward linkage to organization's business strategy.

Based on business requirements and market practices, the Company restructured

the career ladders. The skills level and core competencies for each career step are
clearly defined and distinguished from the adjacent ones to support training,
development and progression decisions.

There are downstream linkages with other human resources programslike

reward, performance management, training and developmentto ensure that the
new career management system is supported.

Under the new Career Progression Planprogression is based on individual's

meritsskills and achievements. Line managers are allowed to develop and reward
staff under his control in a timely manner based on staffs meritsskills
achievements and on business needs. High calibre employees with outstanding
performance/ contribution will have a faster career progression.

Besidescustomized assessment form is developed for each particular career step

which stipulates the required skills/behaviours and competencies. Employee's
skills, performance and contribution are assessed continuously to identify skills
gaps for improvement, potential and readiness for progression/ development.

131

Based on the assessment, line manager together with the employee will draw up a
specific, achievable and measurable development plan.

In addition, a new performance management system is being developed to align

performance effort for achieving business objectives and to enhance performance
ability of all individuals.

Manage Downsizing

The ReshapingRetraining and Redeployment Program is an example of

downsizing as reorientation' as described by Freeman (1994). It is a proactive
adaptation t o realign the organization with changing environment. The Company
has adopted many downsizing tactics discussed in Freeman's article.

Regarding workforce reduction techniques, the Company chose to avoid acrossthe-board cuts but to reduce workforce mainly by attrition and to mobilize the
staff t o other areas in need through retraining and redeployment.

This could

control who stays and who leaves, and preserve needed skills and knowledge.
Besidesundesirable consequence, such as turmoils, conflict, lowered morale, job
insecurity and 'survivor guilt' can be avoided.

To reduce rumours, ambiguity and uncertainty, communication and symbolic

management are highly emphasized in the process.

As mentioned by Linus

Cheungthe ReshapingRetraining and Redeployment Programme is transparent

to all. A number of communications channels have been employed to provide
substantive information about the programme and the anticipated changes, create
sharing meanings, collect inputs and feedback from line managers and staffclarify
s t a f f s and line managers' concerns, provide meaning and reframing for members
and create shared meanings.

ReshapingRetraining and Redeployment Programme also demonstrates that there

is a direct linkage between business planning and human resources planning as

132

described by Bechet and Walker (1993). The drawing up of the macro manpower
plan is based on the target headcount figures in business plans which are submitted
by functional managers.

The target headcount figures are set as part of the

Company's long-term business planstaking into account business projections,

investment plans in new business areas as well as productivity improvement
programmes.

As the three initiatives were just implemented, there are some issues to be
addressed and lessons to be learnt from experiencetheories and success stories of
other Companies.

Emphasize Line Management's Role in Human Resources Management

In all the three cases mentioned beforeline management's role in human

resources management needs to be emphasized.

As the role of Human Resources is transforming to being business partner of line

managementline management needs to share its business and human resources
related business issues with Human Resources.

At the same timeline

management needs to view that the management of human resources in their areas
is the shared responsibility between Human Resources and themselves.

Line management also plays an important role in managing, administering,

controlling and monitoring the Career Progression Plan. Firstly, success of the
Career Progression Plan hinges much on consistency and fairness in making
progression decisions. Line management is in the best position t o ensure the
consistency and fairness. Secondly, line management plays an important role in
managing people's career and performance. Jointly with staff concernedskills
gap can be identifiedand training and development plans that meet individual and
business needs can be developed.

With proper performance management,

performance requirements translated from business requirements can be effectively

communicated to staff and

individuals' contribution can be better measured

133

against the business needs.

These ensure the availability of individual and

organizational capabilities required to achieve Company's strategiesas well as the

effectiveness of utilization of human resources. Thirdly, line management is in the
best position to understand and provide inputs on changes in human resources
requirements resulting from business and environmental changes.

Line

management needs to proactively provide inputs related to assessment criteria,

career structuresskills requirements and staff mix to Human Resources so that
the Career Progression Plan can be reviewed.

Finally, line management's ownership is critical to the success of Reshaping,

Retraining and Redeployment Programme.

They have to understand that the

ownership in achieving the headcount target rests on themselves, not the

Reshaping Task Force.
headcount

target

They have to be committed to the achievement of

by

monitoring

expansion

of

headcount

at

Professional/Managerial level, proactively promoting career opportunities to

surplus staff, addressing skills mismatch issues by identifying appropriate training
programmes for staff together with Training & Development.

Enhance Capabilities of Human Resources Professionals and Build up Trust

and Rapport with Line Managers

Human Resources has long played a controlling and administrative rather than a
value-addingsupporting and consultancy role to line management. To enhance
the linkage between business strategies and human resources management, the
capabilities of Human Resources professionals should be enhanced. On the one
hand, Human Resources professionals need to be open-minded, be alert to
changes in business environment and possess good knowledge about business
needs and hence human resources needs of clients, and t o apply the human
resources expertise creatively and proactively. On the other hand, line managers
should share with Human Resources professionals strategic business issues and
allow them to participate in their business planning process. However, it may take

134

a long time to build up trust and rapport between Human Resources professionals
and line management.

Strike a Balance Between Business Units' and Company's Interests

As Human Resources Services Teams work closely with line management and be
responsible to Business Unit, they may tend to achieve Business Unit's interests at
the expense of the Company's. Besidesthere may be political pressure between
Human Resources Services Teams (client business units' perspectives) and
Corporate Human Resources Teams (company-wide perspectives) under the
existing structure. Overall coordination and control are critical. Job rotations for
Human Resources Professionals among different Services Teams and Corporate
Human Resources Teams may broaden their perspectives.

Establish Monitoring, Control and Maintenance Mechanisms for the Career

Progression Plan

The new Career Progression Plan has been implemented for some time. However,
without proper monitoring, control and maintenance mechanisms, the Plan will
deteriorate and the objectives cannot be achieved.

Proper monitoring system can curtail inappropriate application of progression

criteria and ensure consistency over time and across organizational units. Control
mechanisms ensure that costsproductivity and skill mix targets can be achieved.

As there may be changes in business environment and business needs over time
the previously determined career structuressalary structures, skills requirements
for different career steps as well as the assessment criteria may no longer be
applicable.

This may in turn affect the selection, promotion, training and

development practices/ programmes. Thereforea proper maintenance mechanism

is required to ensure that the relevant elements can be realigned.

135

Forge Stronger Linkage Between Career Progression Plan, Performance

Management System and Reward System

Effectiveness of the new Career Progression Plan depends much on whether a

strong link with performance management system and reward system exists.
Without a strong link with performance management systemperformance data
cannot be obtained to support individual career development and progression
decisions.

Without a strong link with reward systemdesirable behaviours

contributions, competencies and capabilities cannot be reinforced.

Good

performers cannot be properly motivatedrewarded and retained.

Develop Target Staff Distribution Templates

There are no target staff distribution templates upon introduction of the Career
Progression Plan and ReshapingRetraining and Redeployment Programme, Thus
it cannot be assured that the distributions of staff across career streams and career
steps reflect the anticipated business and organizational needsboth in the nearand long-term. Though there are plans for manpower in the Business Plansthe
numbers are only described in broad categories, i.e. Professional/Managerial or
General/Supporting, not specific career steps. Without target staff distribution
templates effective

sourcing,

training,

development

and

redeployment

programmes cannot be developed and delivered. In addition, as business needs

change over timethe Company needs to review the target staff distribution
templates regularly, monitor the (gapbetween target and actual distribution and
take appropriate actions as necessary.

Mobilize Staff to Fill Position in Shortfall Areas

As discussed in Chapter 6there will be problem of skills mismatch at

General/Supporting level. The greatest shortfall would occur in Customer Service
streammainly due to high turnover and the greatest surplus in Technical
Customer Service streammainly due to improvement in productivity.

136

If

insufficient number of staff transfer to shortfall areasbusiness performance will be

at stake. Since the process of voluntary transfer is unsatisfactory, the Company
needs t o take a more guided/ directed approach in moving staff. The Company
should more proactively promote career opportunities in shortfall areas. Also, line
managers should more proactively identify suitable career opportunities for
surplus staffand arrange retraining and specific skills training for them. Besides
the Company can enhance the general skills level of surplus staff by organizing
generic skills training, like sales, customer service, administrative and language
skills training, for them.

Monitor Growth at Professional/Managerial Level

About 30% of projected shortfall at Professional/ Managerial level is due to

expansion at Professional/ Managerial level.

Such expansion is often at the

expense of reduction at General/Supporting level. Besides, the rapid expansion

may cause bottleneck problem because there are insufficient internally trained staff
with the required skills and knowledge to fill the posts. If such growth is not due
to business needs but just a grade drift issue, there will be a serious problem of
shortfall and unjustifiable sharp rise in staff costs even when there is a net
reduction in headcount. Cost effectiveness cannot be achieved.

Look Beyond 95/96

Currentlythere is only a detailed manpower plan, including the projected

manpower requirements and shortfalls/ surpluses for the year 1995/96. N o plan
exists for the coming 4 to 5 years.

It is impossible t o plan in advance the

utilization of manpower resources in the years to come. Those who are now
declared surplus may be in great shortage in future. To ensure the future business
performance is not adversely affected and the people required can be trained in
advanceit is necessary to have manpower targets for the coming 4-5 years

137

As mentioned abovethere are still many obstacles to be removed and issues to be

addressed in managingimplementing and controlling the three initiatives. The success of
the three initiatives hinges on the joint collaboration of the Companythe line
management, Human Resources and the staff members. Only time can tell the success or
failure of the three initiatives.

138

Appendix 1

Organization Chart of Hongkong Telecom

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Appendix 3

Performance Anchor Forms and

Competency Assessment & Development Forms
For Customer Service (CFO) Stream

Hongkong Telecom

PERFORMANCE ANCHOR F O R M : CUSTOMER SERVICE STREAM

CUSTOMER FRONT OFFICE : C l & C2

Level of Achievement:

S/N:

Staff name :
Branch/Area/Location ;
Cost Centre Code :

Tick 0 the appropriate box

N: Not Applicable
U: Unable/Unwilling to meet the requirements
L: Learning to/Occasionally meet the requirements
A: Adequately/Generally meet the requirements
F: Fully meeting customer requirements to
positively influence their perceptions

PART I

Review Period :
_

uses voice/eye contact/body language to show interest and positive response to

customers

face to face: shows attention to dress and grooming to meet company standard

consistently handles tests/calls/customers with speed/promptly

*4

consistently greets customer and gives clear identity

*5

consistently chooses polite phrases

*6

consistently asks and answers questions clearly

*7

offers alternative solutions to meet customer."' expectations

keeps customers informed of what s/he is doing while customer is waiting

shows attention to the call/casc/customer by not doing non-job related things

10

escalates call/case to supervisor when subjccL/qucstion is beyond his/her job

knowledge

*11

meets customers' transactional requirements using English

13

meets customer's transactional requirements using Putonghua

SYSTEM ILWDLING BEHAVIOURSi

follows prc-set work procedures

completes a normal transaction

generally meets standard of performance in number of calls/cases handled

*4

tries hcr/himsdf to trouble-shoot system problems on-the-spot

demonstrates that s/hc is familiar with the system to be able to focus 100% on the
customer

KNOWLEDGE OF THE BUSINESS

1

demonstrates product/servicc knowledge in the job function

*2

has enough knowledge to offer alternative solutions where opportunily exists

; A

;;

".

...

consistently answers customers* questions with in the scope of the job

12

H I mmI I I

T E A M MEMBERSHIP BEHAVIOURS (meeting needs of internal customers)

attends consistently

*2

willing to offer assistance to colleagues in job related matters

*3

readily agrees to lake up spcckl assignments

influcnccs team colleagues positively

,:.

.
: :

_ : :

Illl : _ R

:.;:; :
?:'

:
::

_
VS:::.

raises questions, makes suggestions to supervisor to improve customer saiisfaclion

* = diilcrcnnating behaviours

(16 Dcccmbcr SW/homc/Fil&2.a:0)

Hongkong Telecom

PERFORMANCE ANCHOR FORM : CUSTOMER SERVICE STREAIM

CUSTOMER FRONT OFFICE : C3 & C4
Staff name :

S/N:

Branch/Area/Location:

Cost Centre Code :

of Achievement:

Tick 0 the appropriate box

N: Not Applicable
U: Unable/Unwilling to meet the requirements
L: Learning to/Occasionally meet the requirements
A: Adequately/Generally meet the requirements
F: Fully meeting customer requirements to
positively influence their perceptions

FART I
Review Period :

:::::::::::::,.
111 >*>>f | i |

1
1

uses voice/eye contact/body language lo show interest and positive response to customers

face to face: shows ariention to dress and grooming to meet company standard

*3

consistently chooses polite phrases

grasps opportunity 10 upsell products during oiher iransactions

uses selling skills 10 secure orders most of ihe time

.REMARKS

consistenily handles unhappy customers skillfully

7

manages customers' needs and feelings using English

manages customers' needs and feelings usin Putonghua

*9

gets ihin^s done to meet customer needs by influencing internal colkagucs

10

asks questions, checks and clarifies to ensure understanding o f complex requests

*11

. : s.::

consistently offers altcmanve solutions lo meet customer expecialions

SYSTEKt HANDLING BEHAVldURS !

follows pre-set work procedures in required systems
completes a normal transaction in required systems # 3

generally meets standard o f performance In number of calls/cases handled

tries her/himself to troubli-shoot system problems on-the-spot
demonslraies that s/he is familiar with systems to be a b k t o focus 100 % on ihe customer

.
.

>
>

'

.
-

can liaise with oihcr parts o f ihe business to get solulions for the customer
has enough knowledge to offer altcmatlvo solutions where opportunity arises
3

11

can recognize opportunity to sell ccrtam products and has ihe product knowledge
necessary to sell

T E A M M E M B E R S H I P D E I I A V I O U R S (meeting needs of iniemnl customers) .

attends conslstcndy

*2

helps colleagues to achieve team resulis through coaching/cQunselling

*3

readily takes up and welcomes special assigmncnls

influences learn colleagues posUivcly
supervises j u m o r members of the team on tn asststing/admg basis
m a k e s recommendations and suggestion for Improving systcms/proccdurcs/equipment
opcraiton
raises questions, makes suggestions lo supervisor to Improve customer saiisfaclion

dirfcrcmiating behaviours
.
.
sysicm nanrw?, Plcaw put ktier a, b etc. m ppropnaie box

(16 Dccmhcr

 Hongkong Telecom

Level of Achievement: Tick 0 the appropriate box

PERFORMANCE ANCHOR F O R M : CUSTOMER SERVICE STREAM

CUSTOMER FRONT OFFICE : C5

l i iI

N:
U:
L:
A:
F:

::::::::::::::::::::
mm
'S:.
N

i__
mm

mm
:::::
:::::i mm Ill:::::::::::::::::::: ___
III

C
U S To
O M
X R H
A N D
ONGB
EH
AVIO
R

uses voice to sound interested and positive when responding to calls and throughout the
conversation

consistently chooses polite phrases when defiling with customers

consistently handles unhappy customers skillfully

consistently handles complaints skillfully

consistently offers alternative solutions to meet customer expectations

manages customers' needs and feelings using English

manages customer transactions using Putonghua

gets things done to meet customer needs by influencing internal colleagues

asks questions, checks and clarifies to ensure understanding of complex requests

0
1
10

consistently takes follow-up action to satisfy customer comp]aints/ned for action

:::

coaches staff in required systems # a

coaches staff in completing normal transactions in required systems

d
&

analyses traffic patterns and reacts appropriately

arranges staffing levels including O/T to suit traffic pattern

tries her/himself to trouble-shoot system problems on-the-spot

e
b

can H e i s & with other parts of the business to get solutions for the customer

has enough knowledge to offer alternative solutions for customers where opportunity &rises

uses knowledge of company policies and procedures to help unit do the job effectively

;::

,.-.v.-.

/Xv-'vl'.'X*

SYSTEM HANDLING B E H A ^ O X I R S

:c:.;:.

Not Applicable
Unable/Unwilling to meet the requirements
Learning to/Occasionally meet the requirements
Adequately/Generally meet the requirements
Fully meeting customer requirements to
positively influence their perceptions

directs team members effectively to get the job done

helps colleagufes to achieve team results through coaching/counselling and leadership by

example

looks for and welcomes special assignments

influences tefim colleagues positively

conducts staff appris&ls using the current system effectively

makes recommendations and suggestions for improving systems/procedures/e^uipment

operation

demonslmtes a sense of customer care by making suggestions to improve customer

satisfaction

_ ! 1

..:
:::

_
_

:.

( 1 6 December 94/horoe/pijfl_5.CFO)

PA^T I (Contd)
Comments/Recommendation:

PAKTn

TRAINTNTG & DEVELOPMENT NEEDS:

Please tick as appropriate.

( ) J o b knowledge
( ) C u s t o m e r handling skills

( ) I n t e n t i o n to satisfy customers
()Interpersonal skills & contribution

Details:

Next Review Date

Assessee's
Signature

Date

Assessor's Name

Signature

Date

Endorsed by

Signature

Date

PART H I

ONLY APPLTCABLE FOR ANNUAL REVTEW

Review Period :
Review of Overall Performance
Comments (e.g. special comments on performance in particular work areas, overall performance and development under the
review period)

Far exceeds normal requirements of the job.

- Performance consistently better than is normally expected.
- Performance meets the normal requirements of the job.
- Performance needs some improvement to meet the normal requirements of the job. May include those who lack
experience at their current job level.
E - Generally fails to meet the normal requirements of the job. Unacceptable performance.

A
B
C
D

Referring to the above rating scale and giving consideration to Levels of Achievement in Part I throughout the
year, please select the grade (A - E) most appropriate for the assessee, reflecting his/her overall performance.

Assessor's name:

Signature:

Date:

Signature:

Date:

Signature:

Date;

Assessees comments (if any)

Comments by Countersigning Officer:

Name:

(16 Dcccmbcr 94/homcypaf/pafla_5.CPO)

OVERALL
RATING

Hongkong Telecom

C O M P E T E N C Y ASSESSMENT & D E V E L O P M E N T F O R M
Customer Front Office
Lev&l of Competency
Assesses Name:
Career step/position
baing assessed against:
Period "under review:
Assessor's Name:
i

.t

. /

N : Not Applicable
U : UDable/unwilling to meet requirements
L: Leaniing to/Occasionally meet requirements
A: Adfequatdy/Generally meet requirements
FFully meet the requirements

. .

Genene: Gomp nc
1. Team Membership

2. Leadership

3. Results - orientation

4. Customer Concern

5. Personal Drive

6. Innovation

7. Communication

8. Planning and Control

9. Decision Maldng

Stream-related
P r o
10. Delivery o f Customer
Service

11. Increasing Sales

...

Compete

Evidence (e.g. Examples, Facts, Behaviour

observed)

Development
Activity
Required?

Additional Comments

Development Plan

Agreed by Assessee :

Agreed by Assessor :

Date :

Date:

Endorsed By :
Next Review Date :
Date:
Cl 6 Dectmber 94/home/pafyCOMBAS 1 .CFO)

_____

.Hongkong Telecom

GENERIC COMPETENCIES DESCRIPTION : PROFESSIONAJL/MANAGER

Note :

1)
2)

Development level to be defined b y each stream as appropriate

Indicators for higher levels also include all items at l o w e r levels

Team Membership
Description

Development
Level

Indicators

Contributes to team work

a.
b.
.
d.

Share information and ideas with others in his team

Maintain good relationships with people in other areas
Listen to the ideas of others in team and build on their ideas
Adapt behaviour to the needs of the team but without being submissive

Enables teams to create results

through co-operation internally
and across functions

e.
f.

Create results as a team member

Motivate members to contribute on team goals

g.

Able to recruit suitable team members for projects, where necessary from
across functions
Create results as a team leader
Maximize the advantages of team effort and motivate all the members to
contribute on team goals
Able to ensure the make up of the team has sufficient expertise/experience
for the task in hand

h.
i.
j.

2.

Leadership

Development
Level

Indicators

Description
Creates results by setting a good
iBOdel. Develops self

a.
b.
c.
d.

Demonstrate a positive attitude by a can do, approach to tasks

Encourage and stimulates others to make best use of their abilities
Can forecast future requirements of own role against business needs
Able to review own progress with appropriate corrective action i f
necessary

Sets a good model for staff

developments Helps team
members to perform at their best

e.
f.
g.

Willingly assumes leadership role to get things done

Create team spirit and individual interest in getting work done well
Understand the strengths and w&aknesses of his/her staff and conducts
coaching and development activities accordingly

h.
i.

Create systems and atmosphere for effective teamwork and quality culture
Develop in others the ability, willingness and desire to work towards a
common objective
Manage performance of others by setting a. good example

j.

3.

Results - orientation

Developmeiit
Level

Indicators

Description
Is result - minded and achieves
task objectives

a.
b.

Agree targets for self/staff and achieve

Understand requirements and complete work

Ensures the best use of resources

to create quality results

c*
d.
e.
f.

Set targets for staff and monitor to ensure results

Optimise resources to achieve best results
Change work methods and procedures to achieve better and timely results
Formulate action plans to achieve targets and objectives

Sets the direction of the team to

create quality results

g.
h.

Identify and create opportunities for new initiatives to achieve results

Negotiate budget and other resources for achieving agreed objectives

GENERIC COMPEIENCIES DESCRIPTION PROFESSIONAL/MANAGER

4.

. Customer Concern

Development
Level

Description

Indicators
a.

Maintains a customer focused

approach with customers they
have contact with

5,

b.
c.

Demonstrate an understanding of customer/supplier process, whether

internal or ext&mal
Meet with customers to discuss their needs
Keep in close contact with customers to check on how well their needs are
being met

d.
e.

Use company procedures flexibly to satisfy customers

Introduce products/services/ways of working to address customer
needs/feedback

f.
g.

Build and maintain strong relationship with, internal/external customers

Set standards of customer service, for self and team

Personal Drive
Development
Level

Maintains a positive attitude

towards work challenges

6,

Description
a.
b.

Indicators

c.

Show enthusiasm and drive to g&t things done

Develop self to meet the competence demand of different and changing
situation
Maintain commitment and effort in spite of setbacks or problems

Develops self and others to

ensure ability to successfully take
on challenges

d.
e.

Look for challenging work

Use initiative to make improvements and enforce results

, U s e s influence and persuasion to

..get the best out of others

f.
g.
h.

Take personal responsibility for making things happen

Try to influence rather than passively accept events
Take ownership of initiatives to achieve results

Innovation

Development
Level

Indicators

Description
Seeks new methods to create
improved worldjig practices

a.
b.
c.

Stimulates team to develop

initiatives to meet services needs
externally and internally

d.
e.
f.
g.

Personally try new or faster ways to handHng problems

Actively seek from others new and more efficient ways of taclding
problems
Critically examine existing methods in order to improve them
Review work practices and procedures regularly to explore new ways to
achieve objectives
Stimulate team to generate innovative and creative ideas
Review overall system and introduce new concepts/practices to achieve
goals smd/or before better results
Generate and implement innovative and creative ideas

/*
V"
|

.Hongkong Telecom

GENERIC COMPETENCIES DESCRIPTION s PROFESSIONAL/MANAGER

7,

Commumication

Development
Level

8-

Description
Indicators
Communicates clearly and
effectively within a limited range

a.
Present information and opinion effectively in both oral and written forms
Communicate and obtain feedback from
customers and suppliers (internal
and external)

Communicates clearly and

effectively with a broad range of
contacts

b.
c.

Hold meetings effectively

Set up and run effective communication system for his/her team

Communicates persuasively at all

levels, internally and externally

d.
e.

Initiate dialogue with senior management comfortably

Establish personal network outside own area, to search for relevant
information to fulfil customer needs

Planning and Control

Development
Level

9.

Description

Indicators

Ensures work is done on time

and effectively

a.
b.
c.

Plan and schedule work efft&ctively for self and staff if applicable
Monitor and control costs and expenses
Achieve pknned deadlines for self and team if applicable

Tracks and monitors performance

and rcfocuses energies where
appropriate

d.
e.
f.

Establish progress monitoring techniques against identified control points

Modiiy objectives to ensure they are both realistic and challenging
Identify potential problems and make contingency plan to take account of
these

Plans with future strategic needs

in mind

g.
h.
-i.

Decision Making

Development
Level

Description

Indicators

Takes responsibility for own

decisions

a.
b.

Willing to rnalcc all decisions within sphere of responsibility and authority

Accept delegated decision makiiig responsibility

Makes decisions for self and

team

c.
d.

Evaluate proposed changes for benefits and disadvantages

Make decisions to enable team to move forward on a project/task

Maies strategic decisions

e.

Recommend and make use of a variety of perspectives when maldng sense

of a situation
Make a decision in uncertain situations or based on restricted infoiroadon

f.

../

Take account of future trends/needs and potential changes in planning

Oversee and ensure expenditure of all cost centres are within budget
. Can plan and manage resources, including staffing and succession
planning

i y^mrK'rvir" rOVPFTESCIKSrHOVE'PGR-CFaH

GENERIC COMPETENCIES DESCRIPTION PROFESSIONAL/MANAGER

10.

Delivery of Customer Service

Development
Level

Descriptioii
Delivers quality customer service
that satisfies customers

Indicators
a.
b.

Acquires job related knowledge

..to offer best solutions

c.
d.

Observant to changing and

increasing customer expectation
f.
g.

11.

Able to project positive image by demonstrating a caring attitude in every

encounters with the public
Tactfully exercise flexibility on a case- by case basis to resolve customer
problems which results in customer satisfaction and company goodwill
Possess in-depth knowledge of the procedures and multi-service delivery
processes to offer solutions to customers that exceed their expectation
Possess good understanding of the organization and operating systems and
able to resolve customer complaints using cross system/functional
knowledge
Alert to increasing customer expectation and make recommendation for
improvement to constantly satisfy customers
Review and accurately forecast the trend of service demand and make
good judgement to reallocate resources to satisfy public demand
Observant to the market practice and malce good adjustment to improve
service-quality level to satisfy and retain customers, and enlarge customer
base

Increasing Sales

Development
Level

Indicators

Description
Increases selling effectiveness

a.

b.
c.
d.

Sets strategy and plan to increase

market share and product
penetration

(1 DeotmUr 994/GEKERJC COMPETESaESiHOME^PAF/PROF^MGJLCFO/4)

e.
f.

Possess thorough product knowledge of the company and able to identify

customer needs and promote/sell the right product to customers that
satisfies them
Grasp eveiy opportunity to sell and result in happy buying
Able to give advice on the possible and practical applications of our
products to satisfy customers in their own situation
Observant and predictive to changing customer needs and malce
recommencktioii on product development to satisfy future market
requirements
Formulate sales plan, guidelines and tactics as derived from sales strategy
for implementatioii to increase sales successM rate
Set sales policy and strategy to enlarge our market share and product
penetration for increasing revenue contribution

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References

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