4TH ANNUAL

LEARNING WORLD 2010

Zafar Aziz OsmaniHong Kong

February 25, 2010

Manage Post Recession

Transition of Teams to Ensure Productivity And

Strategic Competitive Advantage

“While we have come through the most difficult period of financial tsunami, the external environment is still fraught with uncertainties and foundations of recovery are not yet firm.”

John Tsang Chun- wahFinancial Secretary, Hong Kong

February 24, 2010

Yesterday . . . .

Themes from Davos 2010Rethink, Redesign and Rebuild

A YEAR ON FROM THE BLEAKEST OF THE WORLD ECONOMIC FORUM , HOPES WERE HIGH FROM DAVOS 2010

EMERGING MARKETS PROVIDE AN UPBEAT WORLD VIEW TO ENCOUNTER PESSIMISM

THE DEBATE AND OUTCOMES PROVED INDECISIVE

“NOTHING IS GOING TO HAPPEN. WHAT‘S GOING TO HAPPEN IN STATUS QUO”

IT WAS FULL OF HOPE AND OPTIMISM ABOUT EMERGING MARKETS – PROMISE FROM CHINA

Presentation Outline

COMPARATIVE TRENDS

THE WEST, ASIA&

EMERGING MARKETS

2007 2008 2009 F 2010 F0

1

2

3

4

5

6

7

8

9

10

Asis Pacific

Asis Pacific

Asia Pacific – GDP Trend

Asian Countries GDP Trends

2007 2008 2009 F 2010 F

-6

-4

-2

0

2

4

6

8

10

12

14

Trends

SingaporeMalaysiaHong KongIndonesiaThailandChinaIndiaG

DP

Rate

Recovery Trends in US & China

China CHINA UNITED STATES

RECENT HIGHLIGHTS IN ASIA

• Singapore's economy leaps out of recession, expanding in the second quarter at its fastest rate in nearly 6 years, thanks to a surge in biomedical production and construction.

• Hong Kong pulls out of its deepest recession since the Asian financial

crisis in the second quarter, growing by a much faster-than-expected 3.3 percent from the previous quarter.

• Taiwan's economy grows for the first time in over a year in the second quarter on an annualized basis and officials say they expected rising demand from China to support a strong recovery.

• Thailand's economy emerges from its worst recession in 11 years in the second quarter, growing 2.3 percent from the first quarter as manufacturing rebounded, adding to signs of recovery in Asia's export-reliant economies. Sept 11 –

• Japan's economy grows 0.6 percent in the three months to June, less than preliminary figures had shown but confirming that the economy crawled out of recession after a full year of sharp contraction.

OTHER PARTS OF WORLD

• Germany exits recession in the second quarter despite a massive drop in inventories and restocking by firms could spur the economy to faster growth.

• Brazil exits its short-lived recession as second-quarter numbers show stronger-than-expected 1.9 percent return to growth for Latin America's largest economy after only two quarters of contraction.

• Sweden inches out of recession, after contracting for four quarters in a row. The economy ekes out a 0.2 percent gain in the second quarter from the previous quarter.

• New Zealand unexpectedly ends its longest recession on record.

HUMAN RESOURCES

STRATEGIES AND RESPONSE

TO RECESSION

KEY UNIVERSAL RESPONSE

Downsizing &

Retrenchment

Salary Freezes

& Reducti

on

Reductions in L

& D Expendi

ture

KEY UNIVERSAL RESPONSE

Downsizing

DOWNSIZING

‘In the annual American Express/CFO Research Global Business & Spending Monitor (article dated Sep 2009), 285

senior finance executives from the U.S., Europe, Canada, Mexico, Asia, and

Australia were surveyed upon the global financial crisis. When the discussion of

layoffs came up, half the respondents in Asia and Australia anticipated a decrease

in headcount.’

Downsizing Issues

Psychological

Physical Behavior

Démotivation Stress Productivity reduced

Insecurity Fatigue Higher turn-over

Trust Déficit Burn-out Higher absenteism

Credibility Damage Change résistance

Managing Downsizing

Golden Handshake Lump sum payments Supported by

psychological pressures

Outsourcing Identified services

outsourced to third party

Employees given GHS plus option of service in OS companies

Some innovations Creation of OS

Companies Giving ownership

to separated employees

Give flexibility to expand the scope of services

KEY UNIVERSAL RESPONSE

Salary Freezes & Reduction

SALARY FREEZES / REDUCTION

‘The number of companies considering decreasing, freezing and have already decreased/frozen salary increase budgets have more than doubled in Asia in the past eight months from 41.0% to 83.4%. (Source: Financial Express – 16/12/08)’

SALARY FREEZE / REDUCTION

Asian companies revised 2009 salary increases downwards by 4.6%

Companies in almost all markets have been cutting manpower costs

Existing employees expected to do more

Insecurity amongst employees

De-motivated staff looking for opportunities elsewhere

Issues of Absenteeism

Responses Impacts

KEY UNIVERSAL RESPONSE

Reductions in L & D

Expenditure

‘According to a study by IT research and advisory firm Gartner, investment in IT training and software certification was set to decline by 25% in the Asia-Pacific region (July 2009).’

CUT IN L & D EXPENDITURES

CUT IN L & D EXPENDITURES

Lesser Training Opportunities for staff

Less focus on Talent Development

IT Training tremendously affected

De-motivated staff looking for opportunities elsewhere

Limits skill of employees

Emergence of a gap in future skills

Responses Impacts

POST RECESSION TRENDS AND STRATEGIES

Hiring Trends China – Hong Kong - Singapore

Hiring Trends – ChinaSector Analysis

Hiring Trends in Hong Kong

And Singapore

Salary Increase

Incentives & Bonus

MANAGING AHEAD

2010 & BEYOND

Broad Forward Strategies

Fresh Look At Organization

StructureNew Paradigm on Employee

EngagementTalent Acquisition /

RetentionInnovative

Compensation ManagementBuilding New

Leadership SkillsBridging Widened

Skills Gap

Fresh Look at Organization Structure

• Fully leveraged by technology

• Complete review of business processes

• Elimination of all non value added steps and positions

• New positions fully loaded with multi-tasking

• Effective re-deployment of work force

Evolve New Organization Structure

New Paradigm of Engagement

• Restoration Of Sense Of Security

• Trust Building And Reducing Credibility Gaps

• Confidence Building Measures

• Regular Structured Two Way Communication

• Involvement In Business Decision Making Process

Total Engagement

and Involvement of New and Old People Resources

Talent Acquisition & Retention

• Talent acquisition & retention in high demand markets

• Structured capacity building programs with fast track skills building

• Finding best HR practices from developed markets which can offer solutions

Enhancing Managemen

t Competenci

es In Specific

Dimensions

Innovative Compensation Trends

• Compensation Structure with Visible Linkage to• Competency

Enhancement• Value Addition• Innovation

• Contribution towards building organization trust, confidence, credibility and team work

A Broader Scope of

Compensation

Management

Beyond Financial Frontiers

Building New Leadership Competencies

• Critical requirement of building visionary / futuristic leadership competencies in organization re-building

• Change Management thought leadership to evolve creative solutions for successful institutional transformation

Bringing Modern

Leadership / Change

Management

Competencies In

Emerging Markets

Bridging Widened Skills Gap

• Serious gaps at middle management leadership due to reduced focus on training

• Exposure as a result of inexperienced inductions

• Critical shortage of change management talent with required competencies

Managing Widened Skills Gap

Due To DownsizingAnd Cut In L

& D Expenditure

CONCLUDING PICTURE

ON

CURRENT TRENDS

HR Response to Recession Impact

zafarosmani@gmail.com

zafar.osmani@peopleperfectae.com

THANK YOU