Professional Documents
Culture Documents
Citation
URL http://hdl.handle.net/10722/37739
SUBMITTED B Y
CHENG LAIS M
AUGUST 1995
CONTENTS
Page
Abstract
Chapter 1 Introduction
5.1. Objectives 67
5.2. Benefits to Employees 68
5.3. Features of the New Career Progression Plan 68
5.4. Comparison Between New and Old Systems 71
5.5. Assessment and Development 74
5.6. Performance Management System 75
5.7. Planning and Implementation 77
5.8. Issues Identified 84
5 9. Summary 85
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Chapter 6
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6.1. Overview of the Reshaping, Retraining and 89
Redeployment Process
6.2. The Briefing Session 91
6.3. The Reshaping Task Force 94
6.4. Redeployment Strategy 96
6.5. Redeployment Policy 97
6.6. Implementation Guide 100
6.7. Communications 111
6.8. Employees' and Line Managers' Concerns 115
6.9. Progress and Projection by End March 1996 120
6.10. Issues Identified 122
6.11. Summary 123
References
ABSTRACT
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:
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
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).
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
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).
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.
- 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.
- 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.
- 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.
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.
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
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
Human Resources Processes Defines how these activities are carried out
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.
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.
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.
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:
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.
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:
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.
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 people-
related 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:
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.
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
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
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.
- 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.
19
contribution required at each level in each development streamand assures
parity in pay across the development streams for comparable levels of
contribution.
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.
21
Development of staff distribution templates
22
- mapping developmental paths and identifying key broadening or
developmental experiences
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.
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):
1
Short Term Budget/Annual Operating Plan ^ ^ Immediate Staffing Actions
Source: Thomas P. Bechet and James W. Walker, "Aligning Staffing with Business Strategy", Human Resource Planning, Volume 16,
Number 2, pp 6
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.
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
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
Downsizing as Reorientation
_ Downsizing Tactics
28
attrition, speed of downsizingretraining and redeploymemt of personnel
to support new activities as well as the selectivity of cuts.
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.
30
Types of Change
31
Downsizing as Convergence
- Downsizing Strategy
- Downsizing Tactics
32
Downsizing Implementation Processes
Types of Changes
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.
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
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 inside-
out (core capability) perspectives were applied to align key roles, core
competenciesdelivery paths and relationships. The new structure is shown in
Exhibit 5.
35
Corporate HR
'Core Competencies
.Functional competencies ore Competencies
/Roles Cost-effective delivery of HR
Service Delivery processes/transactions
.Corporate-wide programs
Through B.U./ Services Customer Service
.Standards
for programs Service Delivery
.Agent for Board - 'Due Roles
initiatives Systems
Diligence' Delivery of common services
Jointly with B.U. for Automation
.Functional network Processing of HR-related
Due Dilligence' issues Outsourcing
leadership transactions
Direct delivery
Customers
.All HR for support & for selected
expertise purposes
.NTL Board for 'Due
Dilligence' matters
Business Unit HR
Core Competencies Customers
Business partnership B.U. management
All HR for sharing
Roles
B.U. needs
Strengthening B.u
Service Delivery
organization effectiveness
HR support for B.U Through influence
objectives & consultation with
HR plan for B.U management
B.U. info/feedback to HR
Collaborative customer-
supplier partnership with
primary consideration
being the business and
employee needs.
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 transaction-
based work, Services is able to aggressively reengineer, automate, and drive toward
more self-service by employees and managers.
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
Senior \
Corporate HR Business
Management
Unit HR
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
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.
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."
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.
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.
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:
- 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
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) HR Specialists
< > 4
Clusters
Accountability for Business Resu Self Image 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
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
Both Northern Telecom and AT&T gave good examples of strategic human
resources management in the changing competitive environment by demonstrating
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
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 three-
year period, ending next year and there is a price increase capping at CPI - 4%
for domestic services.
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.
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.
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.
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.
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.
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.
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.
50
Organizational Culture
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:
Action Plans:
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:
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
On the other hand, the corporate image should be developed through reputation,
identity and public relations.
53
Action Plans:
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."
Action Plans:
54
CHAPTER 4 THE CASE STUDY _ RESTRUCTURING OF HUMAN
RESOURCES FUNCTION
55
function has been identified as one of the critical human resources practices/
systems where alignment with Company's business strategies is essential
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.
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
56
HR Services Teams Corporate HR Teams
R
[ Services Team
Finance, Admin
& New Business
R
[ Services Team
Mobile Business
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.
There are two Corporate Human Resources Teams, namely Policy and Regional
Support Team and Employee Care Team.
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 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.
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
D i r e c t o r o f Human R e s o u r c e s Board
Corporate HR S e r v i c e s Senior
HR Teams Teams Management
Managers
Employee
Exhibit 11: Relationship among Human Resources Services Teams, Corporate Human Resources Teams, line managers and employees.
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.
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
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.
4.6. Summary
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.
64
to facilitate and to assist line managers in initiating and leading cultural change and
organizational development programmes.
65
CHAPTER 5 T H E CASE STUDY - NEW CAREER PROGRESSION PLAN
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.
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 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:
67
- 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.
The new Career Progression Plan is significantly different from the existing
career/ salary structures. Major features of the new Plan are described below.
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
-Customer Service (CFO) C C l l
-Customer Service (Technical) T1 - T 1 0
-Engineering El -Ell
-Finance F1 - F 8
-Information Technology 11-111
-Market/ Product Management M l -M8
-Sales/Sales Support SI - S 8
-Supplies PI - P 9
-Administration A l - A10
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.
69
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'.
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.
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.
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 Non-
Senior. 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 functions, namely
Accounting/Programming, Administrative, Customer 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 A-
C) 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.
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.
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 line managers and representatives from
Human Resources. 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.
were experienced.
73
flexibility can be exercised in handling salary administration and career
progression issues across different streams.
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:
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.
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.
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.
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.
76
5.7. Planning and Implementation
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.
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 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.
78
steps. Based on the target profile determined by line managers, Human
Resources conducted costing analysis.
After approval was obtained from top management, the New Career Progression
Plan for Customer Service staff was implemented. The implementation schedule
was as follows:
^
^
^^
Time Frame
Announceframework to line manager and Joint Staff End December 93
Council
Communicate the new scheme to staff January 94
Training of assessors By mid January 94
Commence assessment process Mid January 94
Transfer existing employees to new plan 1 February 94
Appoint first batch of staff to ccream steps' March 94
Draw up development plan for those who require January 94 onwards
further training/ development
Measure effectiveness of plan August 94
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
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.
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:
Company strategies.
- To provide a flexible career progression with bottom-line control.
80
- To forge a stronger link between reward and skills/ performance/
contributions.
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.
81
understanding of the common framework and basic principles on which the
career/salary structures should be built.
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:
82
Feedback and inputs were collected through different communications channels,
like Human Resources Hotlines. Such inputs were valuable to the
implementation of the Plan.
.Events
Horizontal transfer of all staff in Hongkong Telecom, 1 January 95
HKTCSL and Computasia to the new structures
Assessment of skills, performance and contribution of staff January 95 onwards
by line managers
Line managers draw up development plans for those who January 95 onwards
require further training/ development
Appointment of qualified staff to higher steps April 95 onwards
Line managers to include in 95/96 business plan the effect of March 95
new career structures
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
Reward System
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.
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. A
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.
87
CHAPTER 6 T H E CASE STUDY - RESHAPING, RETRAINING AND
REDEPLOYMENT PROGRAMME
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.
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
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.
be discussed.
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
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.
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.
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 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.
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
91
Business needs, Productivity
including requirements improvements
in new business areas
Redeployment
Strategy/Policy
Business Plan
-Headcount target
Implementation
Guide
Projected wastage
based on past Monitoring
pattern
Retraining programmes
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.
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
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:
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.
Assuming a clear and detailed manpower plan, it was proposed that the approach
to redeployment should be:
96
Subsequently move to a more directed approachwith line managers
nominating employees for redeployment based on the criteria mentioned
above.
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.
The Company will take into account the need to retain a balanced workforce to
enable the business to continue effectively.
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.
period.
Retraining
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.
There will not be any reduction in salary and benefits of employees upon
redeployment.
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.
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.
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.
101
- In Case of Surplus
Redeployment Process
- Communication to Employees
- 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:
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.
Directed Redeployment
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:
To ensure that a redeployed staff member adapts t o the new job, follow-
up reviews between releasing and gaining line mangers will be conducted
in the initial period after redeployment.
Placement Process
- 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
- For Staff
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,
For Supervisors
106
For supervisors in the releasing areas, briefings will be arranged to
assist them in understanding:
- Career Training
107
The following are also available:
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.
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.
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.
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
- 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.
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.
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.
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.
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.
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
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. They shared their feelingswhat they
114
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.
115
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
- 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.
116
Pay & Benefits After Redeployment
Retraining
117
latest manpower level, turnover statistics and the manpower
targets of different areas.
Promotion Prospects
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
- Performance Management
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.
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.
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.
The following issues are identified during the implementation stage of 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.
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
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.
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.
125
CHAPTER 7 CONCLUSION
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.
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.
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.
In "Meeting the Challenge" initiative, the Company has reviewed its strengths,
weaknessesstrategies and objectives. People is identified as a source of
competitive advantage. 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 Internal Pressures
Expiry of franchise for local voice service Utility culture
in July 95 and hence intensifying competition. Hierarchical, bureaucratic and traditional
Growth opportunities in the region and new Efficiency and productivity problems.
business areas. Competency /capability of existing
Limited growth opportunities in existing employees.
business areas. Convergence of existing 3 group
IDD tariffs reduction and pricing control companies (HK Telecom, HK Telecom
on local voice service. CSL and Computasia)
Increasing customer demand.
Telecom
"People" is regarded as one of the four factors 'People Team' look into various HRM
which are critical to future success of the Company issues and see how these contribute to
fiiture success.of the Company.
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.
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
131
Based on the assessment, line manager together with the employee will draw up a
specific, achievable and measurable development plan.
Manage Downsizing
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.
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.
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.
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.
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.
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
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 near-
and 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.
136
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.
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
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PART I
_
Review Period :
H I mmI I I
. . ...
_ B S
; A
;;
^
".
. S
2 face to face: shows attention to dress and grooming to meet company standard
*11 consistently answers customers* questions with in the scope of the job
Illl : _ R
:
5 demonstrates that s/hc is familiar with the system to be able to focus 100% on the
customer
. :.;:; :
KNOWLEDGE OF THE BUSINESS :
: : ::
?:'
.
i p _
T E A M MEMBERSHIP BEHAVIOURS (meeting needs of internal customers) _ : : VS:::.
.
i attends consistently
FART I
Review Period :
111 >*>>f | i |
:::::::::::::,.
P .REMARKS
1
1 uses voice/eye contact/body language lo show interest and positive response to customers
2 face to face: shows ariention to dress and grooming to meet company standard
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
3 can recognize opportunity to sell ccrtam products and has ihe product knowledge
necessary to sell
attends conslstcndy
dirfcrcmiating behaviours . .
sysicm nanrw?, Plcaw put ktier a, b etc. m ppropnaie box (16 Dccmhcr
Hongkong Telecom
l i iI i__ mm
::::::::::::::::::::
H
C U S To
O M
X R H
A N D
ONGB EH
AVIO R
mm
N
mm .
:::::::::::::::::::: ___
/Xv-'vl'.'X*
:::::i mm Ill-
::::: III
'S:.
i uses voice to sound interested and positive when responding to calls and throughout the
conversation
0
1
10 consistently takes follow-up action to satisfy customer comp]aints/ned for action
.
-
- ::: : X
SYSTEM HANDLING B E H A ^ O X I R S
:c:.;:. 3
;:: _ ! 1 _
_
1 can H e i s & with other parts of the business to get solutions for the customer
2 has enough knowledge to offer alternative solutions for customers where opportunity &rises
3 uses knowledge of company policies and procedures to help unit do the job effectively
..: :.
,.-.v.-. :
! ,
:::
i directs team members effectively to get the job done
( 1 6 December 94/horoe/pijfl_5.CFO)
PA^T I (Contd)
Comments/Recommendation:
Details:
Review Period :
Referring to the above rating scale and giving consideration to Levels of Achievement in Part I throughout the OVERALL
year, please select the grade (A - E) most appropriate for the assessee, reflecting his/her overall performance. RATING
Signature: Date:
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
Lev&l of Competency
Assesses Name:
Career step/position N : Not Applicable
baing assessed against: U : UDable/unwilling to meet requirements
Period "under review: L: Leaniing to/Occasionally meet requirements
Assessor's Name: A: Adfequatdy/Generally meet requirements
FFully meet the requirements
1. Team Membership
2. Leadership
3. Results - orientation
4. Customer Concern
5. Personal Drive
6. Innovation
7. Communication
9. Decision Maldng
* - ...
Stream-related
P r o
T
Compete
Development Plan
Date : Date:
Endorsed By :
Next Review Date :
Date: _____
Team Membership
g. Able to recruit suitable team members for projects, where necessary from
across functions
h. Create results as a team leader
i. Maximize the advantages of team effort and motivate all the members to
contribute on team goals
j. Able to ensure the make up of the team has sufficient expertise/experience
for the task in hand
2. Leadership
Development Description Indicators
Level
Creates results by setting a good a. Demonstrate a positive attitude by a can do, approach to tasks
iBOdel. Develops self b. Encourage and stimulates others to make best use of their abilities
c. Can forecast future requirements of own role against business needs
d. Able to review own progress with appropriate corrective action i f
necessary
Sets a good model for staff e. Willingly assumes leadership role to get things done
developments Helps team f. Create team spirit and individual interest in getting work done well
members to perform at their best g. Understand the strengths and w&aknesses of his/her staff and conducts
coaching and development activities accordingly
h. Create systems and atmosphere for effective teamwork and quality culture
i. Develop in others the ability, willingness and desire to work towards a
common objective
j. Manage performance of others by setting a. good example
3. Results - orientation
Developmeiit Description Indicators
Level
Is result - minded and achieves a. Agree targets for self/staff and achieve
task objectives b. Understand requirements and complete work
Ensures the best use of resources c* Set targets for staff and monitor to ensure results
to create quality results d. Optimise resources to achieve best results
e. Change work methods and procedures to achieve better and timely results
f. Formulate action plans to achieve targets and objectives
Sets the direction of the team to g. Identify and create opportunities for new initiatives to achieve results
create quality results h. Negotiate budget and other resources for achieving agreed objectives
GENERIC COMPEIENCIES DESCRIPTION PROFESSIONAL/MANAGER
4. . Customer Concern
5, Personal Drive
Maintains a positive attitude a. Show enthusiasm and drive to g&t things done
towards work challenges b. Develop self to meet the competence demand of different and changing
situation
c. Maintain commitment and effort in spite of setbacks or problems
, U s e s influence and persuasion to f. Take personal responsibility for making things happen /*
..get the best out of others g. Try to influence rather than passively accept events V"
h. Take ownership of initiatives to achieve results |
6, Innovation
Seeks new methods to create a. Personally try new or faster ways to handHng problems
improved worldjig practices b. Actively seek from others new and more efficient ways of taclding
problems
c. Critically examine existing methods in order to improve them
Stimulates team to develop d. Review work practices and procedures regularly to explore new ways to
initiatives to meet services needs achieve objectives
externally and internally e. Stimulate team to generate innovative and creative ideas
7, Commumication
Development Description
Level Indicators
Communicates clearly and a. Present information and opinion effectively in both oral and written forms
effectively within a limited range Communicate and obtain feedback from customers and suppliers (internal
and external)
Ensures work is done on time a. Plan and schedule work efft&ctively for self and staff if applicable
and effectively b. Monitor and control costs and expenses
c. Achieve pknned deadlines for self and team if applicable
Tracks and monitors performance d. Establish progress monitoring techniques against identified control points
and rcfocuses energies where e. Modiiy objectives to ensure they are both realistic and challenging
appropriate f. Identify potential problems and make contingency plan to take account of
these
, Plans with future strategic needs g. Take account of future trends/needs and potential changes in planning
in mind h. Oversee and ensure expenditure of all cost centres are within budget
-i. . Can plan and manage resources, including staffing and succession
planning
9. Decision Making
Takes responsibility for own a. Willing to rnalcc all decisions within sphere of responsibility and authority
decisions b. Accept delegated decision makiiig responsibility
Makes decisions for self and c. Evaluate proposed changes for benefits and disadvantages
team d. 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
f. Make a decision in uncertain situations or based on restricted infoiroadon
Delivers quality customer service a. Able to project positive image by demonstrating a caring attitude in every
that satisfies customers encounters with the public
b. Tactfully exercise flexibility on a case- by case basis to resolve customer
problems which results in customer satisfaction and company goodwill
Acquires job related knowledge c. Possess in-depth knowledge of the procedures and multi-service delivery
..to offer best solutions processes to offer solutions to customers that exceed their expectation
d. Possess good understanding of the organization and operating systems and
able to resolve customer complaints using cross system/functional
knowledge
Observant to changing and Alert to increasing customer expectation and make recommendation for
increasing customer expectation improvement to constantly satisfy customers
f. Review and accurately forecast the trend of service demand and make
good judgement to reallocate resources to satisfy public demand
g. Observant to the market practice and malce good adjustment to improve
service-quality level to satisfy and retain customers, and enlarge customer
base
Increases selling effectiveness a. Possess thorough product knowledge of the company and able to identify
customer needs and promote/sell the right product to customers that
satisfies them
b. Grasp eveiy opportunity to sell and result in happy buying
c. Able to give advice on the possible and practical applications of our
products to satisfy customers in their own situation
d. Observant and predictive to changing customer needs and malce
recommencktioii on product development to satisfy future market
requirements
Sets strategy and plan to increase e. Formulate sales plan, guidelines and tactics as derived from sales strategy
market share and product for implementatioii to increase sales successM rate
penetration f. Set sales policy and strategy to enlarge our market share and product
penetration for increasing revenue contribution
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References
REFERENCES
Prahalad, C.K. and Bettis R.A., "The Dominant Logic: A New Linkage Between
Diversity and Performance'1, Strategic Management Journal, Volume 71986, pp
485-501.
Schuler, R.S. and Walker, J.W., "Human Resources Strategy: Focusing on Issues
and Actions", Organizational Dynamics, Summer 1990, Volume 19pp 5-19.
Wright, P.M and Snell, S.A., "Toward an Integrative View of Strategic Human
Resource Management", Human Resource Management Review^ Volume 1
1991pp 203-225.
"Human Resources: The Vital Link to the Line", The Bankers Magazine,
July/August1993pp 4-10.