BUSINESSES OFTEN make the biggest investments
in machinery or equipment, thinking
these will improve their processes and
make them more competitive.
Gerardo A. Plana, executive director of
the People Management Association of the
Philippines (PMAP), however, believed that
businesses make the oft-repeated mistake
of neglecting to put investments in their
people who, after all, must man those machinery
or equipment and face these firms’
customers. For him, employees, quite simply,
make or break a company.
He explained: “What many do not understand,
is when people are mismanaged, it
will be more costly to the business. The
costs are hidden and impact the bottom
line.”
There are many ways these costs pile up.
An employee who has not been trained
well, for instance, can turn off customers, or
potential investors, or potential hires. For
another, employees who are disgusted by
the way the company is being run will resign,
to be followed by others. The constant
process of hiring and rehiring, of training
and retraining, impacts on workplace morale
and productivity.
Conversely, if the employees are happy,
then they will stay with the company or
deal with customers, investors or
new hires nicely. And this similarly
impacts the firm’s bottom
line.
Mr. Plana stressed that
just as investments in
machinery and equipment
are measured in
terms of return on investment
or ROI, so
too, must investments
in people. That is
why, “it is important
to improve the work
environment and hold
people longer… in
order to cut costs
and improve the business’
profitability.”
PMAP, the local
organization of human resource
management professionals,
is pushing for a set of standards in
people management, for adoption by either
big companies or the small and medium enterprises
(SMEs). Mr. Plana calls these standards
a “roadmap.”
“We have an advocacy that there is a
better way of managing people and there
are standards. Companies need to use this
roadmap to achieve excellence in people
management,” he said.
PMAP has gotten the license from the Investors
in People (IiP) based in the United
Kingdom to certify business organizations
that follow these standards. IiP is not only
an international certifying body, it also promotes
the principle that at a company’s
core are its people.
Mr. Plana, who also serves as chief executive
of Investors in People in the Philippines,
says the IiP certification complements
that given by the ISO to company processes
or activities. The certification can act as a
badge that a company is serious about managing
its people well, and so attract more
customers, investors or employees.
“Take a hospital for instance.
Will you go to
one for treatment
where the
nurses and doctors are disgruntled or where
they happy and satisfied?”
But Mr. Plana hastily clarified the certification
is just a “bonus.” “What is important
is that a business is following the roadmap
to become better in people management,”
he stressed.
There are 196 standards but these can
be clustered into six: alignment, development,
empowerment, recognition, continuous
improvement and modeling.
Managers in the case of big firms or the
owners in the case of small businesses need
to see if their employees are aligned with
the business’ goal. “Are employees focused
on business objectives and are they clear
about their roles?” Mr. Plana said, explaining
the first standard.
Second, employees must be “capacitated,”
that is, given training to upgrade their skills
in order to competently do their tasks. And
third, they must be given enough freedom,
enough leeway to achieve their assigned
goals and to make decisions
on their own.
The next three are “critical,” Mr. Plana said, as they form
the core of the standards.
Employees must be given recognition.
The PMAP chief explained: “Are people
told how they are progressing? People must
know, otherwise, they will get de-motivated.”
Fourth, employees must continuously
evolve, change. “There must be continuous
improvement,” Mr. Plana said. “They must
have a sense of dynamism, of changing for
the better, and of themselves becoming
part of the change.”
Lastly, employees need a model, a
leader, who walks what he or she talks.
“The leader shows the way. There must be
no dichotomy between what he or she says
and does,” Mr. Plana pointed out.
Problems arise, he added, when managers
or the business owners lack credibility.
“It will be hard to effect change then,” he
stressed.
The big firms are “more enlightened,” he
noted, when it comes to investments in
people, putting money in training programs
and consultants. This is understandable considering
the size of the organization and
their need to be limber to adapt to change
and to meet the competition.
Small firms cannot be neglectful of investments
in their own people, however,
even if the business owners themselves take
on the role of human resource managers —
in addition to other roles. It is precisely for
this multiplicity of roles that owners need to
take a hard look at how they are managing
their people.
“In SMEs, it is all about growing the
business, thereby neglecting the people
side of the business,” Mr. Plana said. “As
such, these businesses often fail, confronting
a high turnover or a low retention rate.”
Small business owners who are serious
about creating a challenging and nurturing
working environment — humane workplaces,
Mr. Plana stressed — have a higher
chance of growing their businesses.
“The inability to execute plans is basically
a ‘people’ weakness,” he pointed out.
“If SMEs put importance on better ways to
manage their people, then they have a higher
chance of carrying out their business plans.”
Another point to consider is SMEs don’t
attract the best talents. They therefore must
work hard on “making the best” out of what
they have.
Knowing the standards — or getting a
certification — entails cost but PMAP and
IiP are willing to be flexible where SMEs are
concerned. Instead of paying for the cost individually,
Mr. Plana said SMEs can band together.
“Two people each from an SME — say
10 SMEs — can attend a training, and pass
on the knowledge to their organization,”
Mr. Plana said. “So much the better if one
of the two is the business owner.”
“What we want to do is to make the
standards available here. It will be very expensive
if they go straight to London. We
want to make it mass-based,” he added.
Several local companies have signed up
for the IiP certification process. To mark
their progress against the 196 standards,
the IiP hands out bronze, silver and gold rewards.
The First Philippine Industrial Corp. (FPIC)
last year became the recipient of the first IiP
Gold Award given to a local or Asian company
for satisfying 165 of the 196 IiP standards.
FPIC, a member of the Lopez group
of companies and supplier of the pipes that
transport crude and refined petroleum products
from Batangas to Metro Manila, is
manned by just around 40 employees.
The bronze award is given to firms that
meet 65 standards, and the silver, 115 standards.
Mr. Plana stressed that while the standards
will cost companies, whether big or
small, to get acquainted with and apply,
they are a business investment.
“Do you want to improve your profits
through people? If not, then continue mismanaging
your people,” he said. “It’s a
choice.”
. 
Leave a comment