110216 Employee Engagement

7/28/2019 110216 Employee Engagement

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2010 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.towerswatson.com

Food for Thought

The Vietnam economy cont inues to grow quickly, and this is driving a war on talent.What effect do you think this wi ll have on:

z Employee Turnover?

z Employee Engagement?

What factors do you think would drive turnover intentions higher?

z External pay perceptions

z Benefits

z Plentiful opportunities for employment at other companies

z Career opportunit ies

What about the business aspect? Do you think that Vietnamese employeessense that their companies are doing well on the following businessimperatives:

z Innovation

z Market responsiveness

z Strategy


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z Engagement & Employee Turnover: Currently, employee engagement levelsin Vietnam are higher than in the Asia Pacific Region, but employee intent tostay is lower.

z In general, many areas of employee opinion in Vietnam have remained stableover the 5-year period (2006 2010), and most of these opinion areas arecurrently more positive than in the Asia Pacific region, except for:

z Stress, Balance, & Workload excessive workload and job pressure

z Pay & Rewards internal pay equity and matching pay to performance

z Benefits suitability and superiority of benefits program

z External Job Opportunities

z Although employee opinion on Competitiveness in Vietnam is currently more

positive than in the Asia Pacific Region, it is on a declining trend in the past 2years, and this includes competitiveness on:

z Quality of products/ services and customer service

z Development of new products/ services, and responding to market changes

Summary

Possible causes for lower employee intent to stay


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z Other areas in which employee opinion in Vietnam is currently more

positive than in the Asia Pacific region include:z Top managements strategy & direction

z Employee perceptions of Company Image

z Effective performance evaluations

z Empowerment via an innovative climate and involvement in problemsolving

z Increased sophistication in company systems and practices

Summary

Possible causes for higher employee engagement


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2010 Towers Watson. All rights reserved.

Vietnam Employee Engagement &Retention Levels


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To be fully engaged, employees

must:

z THINK Rational / cognitiveunderstanding of theorganisations strategic goals,values, and how employees fit

z FEEL Emotional / affectiveattachment to the organisation

z ACT Motivation andwillingness to invest

discretionary effort to go aboveand beyond

Engagement Model: Leveraging business outcomes

through employee engagement

Act

Engagement

FeelThink


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Bottom Line: Evidence that employee Engagement drivescompany performance

3-Year Study of 40 Global Companies

3.74

2.06

-2.01-1.38

-5

-4

-3

-2

-1

0

1

2

3

4

5

Operating Margin Net Profit Margin

High Engagement Companies Low Engagement Companies

12-Month Study of 50 Global Com panies

19.213.7

27.8

-32.7

-3.8-11.2

-40

-30

-20

-10

0

10

20

30

40

12-Month Change

in Operating

Income

12-Month Net

Income Growth

Rate

12-Month EPS

Growth Rate

P

erce

n

t

C

h

an

e


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77

75

74

73

73

71

71

69

69

68

65

65

65

63

62

61

61

60

60

59

57

57

55

55

54

54

48

48

44

43

ThailandNorway

PhilippinesBrazil

IndonesiaAustriaNetherlands

CanadaNew Zealand

VietnamGermany

SpainUnited States

AustraliaSouth Africa

IrelandMalaysia

ItalySweden

IndiaFranceGreecePoland

United KingdomSingapore

KoreaPRC

TaiwanHong Kong

J apan

Switzerland% PERCENT FAVOURABLE RESPONSE

78

Cultural Context: National culture has a huge effect on

employee perceptionsActual DataActual Data

"Taking everything

into account, how

satisfied are you withyour company as a

place to work?"


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z Global Norm Strength: Towers Watson maintains one of the worlds largestemployee opinion databases, populated with data updated on a regular basisfrom surveys of nearly 4 million employees working for a cross-geography,cross-industry group of companies

z Vietnam Norms: The norm is developed from surveys of employees working inclient organisations in Vietnam, and the current version of the normincludes 28companies* and data from 3,722 employees

z Content: This presentation summarises major changes in the norm over thepast 5 years (2006 2010), and describes the major topic areas drivingemployee engagement and retention

z The Asia Pacific Norm: Newly created in 2010, so no trends are available forthis benchmark

About the Vietnam National Norm

* Includes companies such as Alticor, AREVA, AstraZeneca, Baxter Healthcare, British American Tobacco, Citibank, Groupe

Danone, KPMG, Lloyds, Maybank Group, Merck, Moet Hennessy, Novartis, Schindler, Tetra Pak, Thomson Reuters, & TNT


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Employee Engagement in Vietnam: Holding steady over past few

years, and currently ahead of the Asia Pacific Region

Employee Engagement

78%

74%

77% 77%78%

60%

70%

80%

90%

2007 2008 2009 2010

%F

avor

ableOpinion

Vietnam Asia Pacific


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Employee Intent to Stay in Vietnam: Holding steady over past 4

years, but currently lagging behind Asia Pacific Region

At the present time, are you ser iously consider ing leaving th is company?

54%

61%

55%

53%54% 54%

40%

50%

60%

70%

2006 2007 2008 2009 2010

%F

avor

ableOpinion



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Vietnam Employee Opinion TrendHighlights & Comparison to Asia

Pacific Region


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Total Favorable

40a.I believe top management has: A well form ulated business

strategy for the present 17 *

23a. This company is highly regarded by: The general public 17 *

Total Good

51a.How do you rate your last perform ance review on the following:

Helping you identify your st rengths and w eakness es 17 *

Total Favorable

61b. My supervisor involves me in: Solving problems related to ourwork 16 *

46b.This company has es tablished a clim ate w here: Innovative ideas

can fail without penalty to the originating person or group 16 *

Top 10 Differences From Benchmark Tot FavDiff

Tot Fav

Diff

Tot Fav

Diff

86

89

69

93

68

* indicates a statistically significant difference

Largest Regional Gaps: Employee Opinion Items with the largest positivedifferences against Asia Pacific Region

Strategy &

DirectionI believe top management has a well

formulated business strategy for the present

Image

This company is highly regarded by the

general Public

Performance

Evaluation

How do you rate your last performance

review on the following helping you identify

your s trengths and weaknesses

My supervisor involves me in solvingproblems related to our workSupervision

This company has established a climate

where innovative ideas can fail without

penalty to the orig inating person or groupEmpowerment

Progressive Employee Practices Could be

Driving Up Perceptions of Company Image


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Total Favorable

53. I am often bothered by exc ess ive press ure on my job. (N) -15 *

54. I think m y wor kload is exc essive. (N) -7 *

No

105.At the pres ent time, are you ser ious ly c ons ide ring leaving this

company? -7 *

Total Good

38a.Regarding pay, how good a job do you feel the com pany is doing

in the follow ing areas: Matching pay to performanc e -3 *

Total Favorable

36. Compar ed with other people working here, I think I am paid fairly. -2

Bo ttom 10 Differences From B enchmark Tot FavDiff

Tot FavDiff

Tot Fav

Diff

Tot Fav

Diff

24

33

54

28

46

* indicates a statistically significant difference(N) indicates 'Disagreeing' is the Favorable Response

Largest Regional Gaps: Employee Opinion Items with the largest gaps(negative differences) against Asia Pacific Region

I am often bothered by excessive

pressure on my job

I think my workload is excessive

At the present t ime, are you seriously

considering leaving th is company?Intent to Quit

Regarding pay, how good a job do you

feel the company is doing in the following

areas: Matching pay to performancePay &

RewardsCompared with other people working

here, I think I am paid fairly

Stress,

Balance, &

Workload

High Stress + Lower Perception of Rewards =>

Strain on the Employee Value Proposition


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Declining Pay Perceptions: Employee opinion on Pay & Rewards inVietnam on slight decline over past 5 years, but still comparable to

Asia Pacific Region in 2010

Pay & Rewards

46%

40%

40%39%

38% 38%

30%

40%

50%

60%

2006 2007 2008 2009 2010

%F

avorableOpinion



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Steady Stress Levels: Employee opinion on Stress, Balance, &Workload in Vietnam stable over past few years, and comparable to

Asia Pacific Region in 2010

Stress , Balance, & Workload

40%

44%

41% 41%42%

30%

40%

50%

60%

2007 2008 2009 2010

%F

avorableOpinion



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Employee Opinion on Benefits: On a slight decline since 2008, but

stil l comparable to Asia Pacific Region in 2010

Benefits

60%59%

65%

62%

59%

57%

40%

50%

60%

70%

2006 2007 2008 2009 2010

%F

avorableOpinion



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Employee Opinions of Competitiveness in Vietnam: On the decline

since 2008, but ahead of Asia Pacific Region in 2010

Competitiveness

60%61%

62%

56%

53%

49%

40%

50%

60%

70%

2006 2007 2008 2009 2010

%F

avorableOpinion



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Summary & Conclusions


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Stress

Time away from family

Lack of authority

Lack of freedom

SecurityMoney

Benefits

Accomplishment

Self worth


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Conclusions

z Perceptions of Pay & Reward: Are becoming more negative, butinternal pay practices are having a bigger effect than whats going on inthe external environment.

z Stress and Workload: Perceptions are becoming more negative overtime, but most of this is not due to staffing issues.

z Benefits: There is a slight decrease in perceptions that benefits fit

peoples needs, but a slight increase in perceptions that companybenefits are as good compared to the local labour market

z Competitiveness: People feel as if their companies are doing a betterjob of developing new products and services, but there is increased

negativity regarding the quality of these products and services.


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Recommendations

Pay Attention to the Overall Employee Value Proposition:

z Balancing Effort & Reward: As stress levels are increasing, people need tofeel that what they get in return is commensurate

z Differentiating Performance: Ensure that internal pay practices are fair andeffectively differentiate high performers from lower performers

z Focus on Talent: Ensure that there is a strong link between pay and superiorperformance

z Rewards Benchmarking: Ensure that pay and benefits have beenbenchmarked against local market practices

Competitiveness:

z Consider Quality Before Products are Launched: Build quality considerations

into initial development process for new products and servicesz Get Employee Input Regarding Quality: Ensure that employees have proper

input on quality issues before new products go to market

z Rewarding Quality: Reward employees for improvements on product andservice quality


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Introducing: The VietnamEngagement Indicator Survey


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Survey Design & Administration

z Population: Up to 1000 employees from your company

z Questionnaire: 54 opinion questions that measure over 16 key workplace

topics (15 minutes to complete)z Languages: Questionnaire in English and Vietnamese

z Coding: 4 coding questions (e.g.. J ob level, age, tenure, department/function)

z Key Driver Analysis: 1 Key Driver Analysis to determine priority areas having

the greatest impact on Employee Engagement

z Benchmarks: Comparison with 2 benchmarks (1 industry and 1 national), forsetting clear priorities within the proper context

z Administration: Towers Watsons server to support the on-line administration

of survey and reminders

z Normal Cost: US$4700

z Limited-time Discounted Cost: US$3000


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z Contains 54 questions over 16 categories

z Key workplace factors measured are:

The Engagement Indicator Survey Content

z Leadership

z Strategy & Direction

z Supervision

z Communication

z Organisational Change

z Working Relationships

z Empowerment

z Training

z

Work Tools and Conditionsz Stress Balance & Workload

z Training

z Engagement

z Pay & Reward

z Quality

z Customer Focus

z Organisational Culture


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Should Management be concerned with Pay or Working Relationships?

PAY (Demo data)

Pay as good as or better than

the pay in other organisations.

WORKING RELATIONSHIPS

Good cooperation between

departments.

45

0 20 40 60 80 100

35

55

0 20 40 60 80 100

70

Total % Favourable

Total % Favourable

Benchmarking Clarifies Data Interpretation


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Unparalleled global database of benchmark norms

Country/Region Performance Norms

Transitioning Companies

High PerformingCompanies

Senior Management

Management

Job Level Norms

Senior Management

Management

Hourly

Union and Non-Union

Job Function Norms

Research andDevelopment

Call Centers

Manufacturing Functions

Human Resources

Information Technology

Finance

Sales

Marketing

Industry Norms

Energy

Airlines

Manufacturing

Telecommunications

Government

High Technology

Pharmaceutical

Professional Services

Financial Services

Consumer Goods Construction &

Engineering

Oil & Chemicals

Personal Demographics

Race/Ethnicity

Gender Age

Al l norms are updated annual ly

Over 250 National, Sector, Function and Performance Norms

Argentina

Austria

Australia

Belgium

Brazil

Bulgaria

Canada

Croatia

Czech Republic

Denmark

Finland

France

Germany

Greece

Hong Kong

Hungary

India

Indonesia

Ireland

Italy

J apan

Kazakhstan

Korea

Latvia

Lithuania

Malaysia

Mexico

Netherlands

New Zealand

Norway

Philippines

Poland

Portugal

P.R. China

Romania

Russia

Singapore

Slovakia

South Africa

Spain

Sweden

Switzerland

Taiwan

Thailand

Turkey

Ukraine

United Kingdom

United States

Vietnam


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Results Generated

Report: Active XL Interactive tool to drill down specific issues withindemographic groups and to easily export to PowerPoint

Advanced Analysis: Key drivers analysis determines the areas mostlikely to impact your employees engagement within the context of yourcompany, strategy, and current initiatives

Expert Recommendations: Tailor-designed PowerPoint presentationpack of your organisations results with specific consultantrecommendations

Results Presentation: A face-to-face presentation and facilitateddiscussion with your leadership group


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Towers Watson Expertise

z Full Project Management Support: Assistance and coordinationduring survey design, coding, administration, results and follow up

z Flexibility: Ability to amend aspects of package to suit yourorganisation

z Expert Advice: Masters/PhD qualified Consultants to facilitate processand workable solutions


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Timeframe for Engagement Indicator Survey 2011

z This is a time-limited opportunity

z Survey launched on March 28th

z

Results ready within one month of survey close

MayResults generated

May-June

Results presentation

delivered

March 28-April 22

Survey Launch and

Administered


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Act Phase: Turning results-into-action

I l ti R l Ch T W t


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Example Survey Insights Towers Watson Solutions

z Senior management not sincerely interested

in employee well-being

z Leadership development

z Communication strategy

z Deal alignment

z Employee Advisory Team to leadership

z Havent improved my skills and capabilities

over the last year

z Learning and development strategy

z Competency development

z Career maps / Communication on career

framework

z Performance management

z No input into decision making in my

department

z Role/job design

z Manager capability

z Governance

z Organisational culture

z Organisation doesnt quickly resolve

customer concerns

z Role/job design

z Communication strategyz Al ignment of pay systems & PM systems

z Manager capability

z Insufficient career advancement opportuni ties z Talent management

z Career ladders

z Competency development

z Workforce planning

Implementing Real Change: Towers Watson arange of consulting solutions to help addressyour engagement gaps and create positive change


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2010 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.towerswatson.com 3535

Contact Information

z J essica Lu

Managing Consultant

Suite 808, 8th Floor, Sun Wah Tower,115 Nguyen Hue Blvd., District 1Ho Chi Minh City, Vietnam+84 8 3821 9488 ext. 368

[email protected]

z KieuThi Phuong Dung

Consultant

Suite 808, 8th Floor, Sun Wah Tower,115 Nguyen Hue Blvd., District 1Ho Chi Minh City, Vietnam+84 8 3821 9488 ext. [email protected]

110216 Employee Engagement

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