By Pichaya Changsorn
Published on December 9, 2009
The head of rewards and benefits for giant retailer Tesco Lotus, Ornvalun Sivaleepunth, shared some of the hypermarket chain's human-resources management practices, aimed at combating the effects of the economic downturn, at a recent Hay Group annual conference in Bangkok. The Nation's Pichaya Changsorn reports.
Learning from the high fluctuations in this year's economic conditions, giant retailer Tesco Lotus has become less comprehensive in linking its business management to economic projections and is instead inclining itself towards a period of uncertainty.
"We don't care anymore if the economic [recovery] is U-, V-, or W-shaped. Whatever the economic conditions, our aim will be to [find the right] balance between staff morale and the cost of business," said the retailer's head of rewards and benefits, Ornvalun Sivaleepunth.
Besides freezing its head-count and cutting training expenses, Ornvalun said Tesco Lotus had made a comprehensive review of its five-year rewards and benefits roadmap. It had also taken "a second look" at which projects it could defer, by finding concrete reasons why some should be reprioritised and why others should not, and determining how much this could save the company.
"Because we have a lot of employees, whatever we plan to do could involve a lot of money," she said.
However, despite the need to control costs and reprioritise projects, Tesco Lotus has continued to give a high priority to talent management and building trust and loyalty among its employees - based on the premise the company is a large organisation that will clearly survive the economic crisis, she said.
Tesco Lotus believes talented staff are its most important assets and that if it loses them, it will find itself tracking behind its competitors when the economy recovers, Ornvalun said.
To make sure of retaining talented staff during "the period of belt-tightening", Tesco Lotus has been categorising its staff into five groups. The top group comprises talented staff whose loss would cause a business risk.
The second group comprises underpaid but high-performing staff whose loss would not pose an immediate risk to the business, and so on down to a fifth group who are not underpaid and whose position requires no action from the company.
To prevent any "undesirable effects", employees are unaware to which talent group they belong, she said.
Despite the categorisation, Ornvalun said Tesco Lotus had initiated a "talent-spotting and options programme" based on its firm belief each staff member is talented. Under the motto "I Have an Opportunity to Get On", each member of the company's staff can nominate what he or she would like to do, including moving to other section, or transferring to a branch nearer to a home town.
Provided the staff member passes an assessment, he or she will undergo an orientation and training programme tailored specifically to his or her needs, mostly involving on-the-job training. Then, both the outgoing and incoming bosses must "sign off" on the relocation before the staff member can move to the new job, she said.
Staff members can enter the options programme if they are good performers, have not received a warning notice for at least one year, are able to work upcountry, and are prepared to work twice as hard because they must continue their existing jobs while training for the new one, Ornvalun said.
Staff members do not have to wait for the position they are seeking to become vacant. They may apply, undergo the options process at anytime, and move to a new post when the position they are seeking becomes available.
"Tesco Lotus is a very large organisation, and the options programme is open all the time. There is a high chance [for people to "move on"] because nowadays we can hardly develop our people fast enough to serve our needs. Hence, we don't wait to develop them, and when the positions are vacant, we can fill them [immediately]," she said.
The company's line managers can also nominate staff to enter the options programme.
To spot talented staff, Tesco Lotus does not use assessment tools other than observing a staff member's "twinkle", Ornvalun said, adding that it did, however, apply some interviewing guides for store-level staff.
Regarding performance management, Ornvalun said as an international company, Tesco Lotus had to be results-oriented, although it did not apply a "force-rank" measure that obliged staff who remained at the lowest position on the performance curve to leave the firm every year. The company, nevertheless, has a "process to manage poor performers" that gives underperformers six months to improve.
"We will give the person six months to review his key performance indicators with his supervisor, who will be coaching him closely. If his rating remains unchanged, we will invite him to leave," she said.
Ornvalun said in the present economic circumstances, staff communication was also a vital necessity. Tesco Lotus has several media to connect with its staff, including its monthly magazine called The One, e-mails and in-store voice broadcasts that remind staff of benefits provided by the company or any changes to work procedures, prior to stores opening every day.
On remuneration packages, Tesco Lotus does not communicate "piece by piece". Rather, it gives its staff members the overall picture of total remuneration they receive. At the end of each year, every member of the company's staff receives a benefits summary that details all cash and non-cash benefits he or she has received from the firm during the year. Every item is quantified in cash equivalent, including stock options, company cars, leave days, medical expenses and training courses. Ornvalun said in this way, Tesco Lotus staff understood that even though their basic salary was Bt180 a day and less than that of factory workers, they in fact received more from the company.
Tesco Lotus also believes because there is a recession, this does not mean there should be no fun. Staff have to work harder in periods of economic downturn, so companies should not avoid "energising them" with activities that do not need to cost extra money, she said. For example, firms can invite their workers to join in their corporate social responsibility projects, such as building dams and assisting communities.
"In these cases, employees don't feel they're working hard. It's an activity they can enjoy with their friends. Human resources departments should look for channels through which staff can take part in company activities," she said.
Tesco Lotus currently employs more than 36,000 staff in Thailand.