Attract, Retain, and Find Employees and Partners in Southeast Asia
by: Erika Visser, Associate partner of Hofstede Insights
Why should I read this document?
The goal of this document is to give foreigners pointers on what they will encounter when hiring and managing people from a culture different than their own. Understanding people management in different cultural contexts is very important before going abroad. What motivates one culture can demotivate another, and thus managers need to understand the differences from country to country or they will not be able to attract and retain staff successfully.
Important!
Five most important things to know in order to successfully find partners, and attract and retain employees in Southeast Asia:
1. Because of hierarchy, respecting the different levels, proper status and titles are important. Make sure that your team has the a) right etiquette to show respect to senior and older Southeast Asians and b) adequate status to build rapport with senior players from Southeast Asia. Decisions are usually made through consensus with the final say at the top, and thus negotiations can take longer than expected.
2. Aim to build long-lasting relations first before trying to do any business. Expect few decisions to be made at initial meetings. Always keep communication open and stay in touch often but never be too direct, noisy or confrontational. Try to pick up body language cues that could show that your Southeast Asian counterpart is not in favour of what is being discussed. Social interactions are important to build rapport.
2. Aim to build long-lasting relations first before trying to do any business. Expect few decisions to be made at initial meetings. Always keep communication open and stay in touch often but never be too direct, noisy or confrontational. Try to pick up body language cues that could show that your Southeast Asian counterpart is not in favour of what is being discussed. Social interactions are important to build rapport.
3. The concept of face - never let a Southeast Asian lose face as it will damage and possibly end business relations. Singling out an individual from the group in a group culture is one way to cause someone to lose face. Other examples include open disagreements or through criticising authority figures. Give face to senior or older Southeast Asians through following the right etiquette in each country.
4. Building trust in western countries can be done by showcasing achievements and by presenting the quality of the product. As for Southeast Asians, trust is built in a more emotional way. Southeast Asians prefer to do business with people they know and thus third party mutual connections can help to establish trust.
5. Be well prepared, anticipate needs, and be willing to share copious amounts of information, to the degree that you can. Send information in advance in case of upcoming meetings. Send more than you normally do.
4. Building trust in western countries can be done by showcasing achievements and by presenting the quality of the product. As for Southeast Asians, trust is built in a more emotional way. Southeast Asians prefer to do business with people they know and thus third party mutual connections can help to establish trust.
5. Be well prepared, anticipate needs, and be willing to share copious amounts of information, to the degree that you can. Send information in advance in case of upcoming meetings. Send more than you normally do.
What to look for in a good partner:
- Understands the local and national political situation very well because it can change overnight and is always fluid.
- Has good connections with the government.
- Has the proper status, therefore explore his/her formal titles, e.g. vice president is an important one, because these titles are not used as casually as in the USA.
- Has the ability and willingness to be your contact on the ground or help you find a good one.
- Has lived and or worked and or has done business in the Western world and therefore is sensitive to the direct way of communication and task orientation of most Europeans.
- Ideally advanced his/her local education abroad.
Ensure you have another third-party contact on the ground that can check the credentials of your potential partner first.
"Although national culture plays an important role in attracting and retaining talent, organisational culture plays an equally important role. This article will mainly address national culture and what type of manager is needed in Southeast Asia, how to motivate staff, and some retention strategies. Although there are many similarities among Southeast Asian countries, these countries are each unique with very important differences that need to be taken into account, especially when motivating staff."
"Although national culture plays an important role in attracting and retaining talent, organisational culture plays an equally important role. This article will mainly address national culture and what type of manager is needed in Southeast Asia, how to motivate staff, and some retention strategies. Although there are many similarities among Southeast Asian countries, these countries are each unique with very important differences that need to be taken into account, especially when motivating staff."
What type of manager do you have to be in Southeast Asia?
Southeast Asia consists mainly of Family cultures (High PDI, Low IDV & Low UAI) excluding Thailand (which is a pyramid culture). There are many similarities between Family and Pyramid cultures with one main important difference. Thailand has a high UAI where all other Southeast Asian countries have a low UAI.
An Ideal Boss in Southeast Asia (PDI & IDV)
Both Family and Pyramid cultures score high on the Power Distance (PDI) dimension, indicating that these cultures are hierarchical societies with unequal rights between power holders and non-power holders. Leaders have to be paternalistic, caring for staff in the workplace, and they should always be aware of issues at home and give guidance when needed. Bosses need to be directive, giving instructions on what needs to be done and how it needs to be done, always checking, inspecting and delegating tasks (not power), ensuring that there is adequate resources and skill to complete tasks within a reasonable timeframe. Without checking and inspecting, staff might not ‘respect’ the task at hand and thus might not complete what they were asked to do. Power is centralised and managers count on the obedience of their team members in return for protection from the power holders. Family and Pyramid cultures believe that their supervisors have been chosen because they have more experience and greater knowledge than those they manage and it is therefore unnecessary and even inappropriate for them to consult with lower-ranking individuals when making decisions. The manager/boss is expected to make decisions. Titles play an important role as it will help Southeast Asian people place their colleagues or counterparts in the hierarchy and allow them to show appropriate respect to superiors.
Both Family and Pyramid cultures score low on the Individualism (IDV) dimension, which means that these cultures are collectivist or group cultures organised and centered around relationships (in-groups) rather than tasks. These cultures are not confrontational and in their communication a “yes” may not mean an acceptance or agreement. Communication is indirect and negative feedback hidden, staff do not want the boss to lose face and will share information a boss wants to hear rather than volunteering bad news which creates bigger problems in the long-run. A trusting relationship and showing that a boss can patiently receive staff questions, objections, and opinions can help to extract bad news. A boss should create a good working environment. Social and business relationships for staff are mostly blurred and thus a boss should preferably avoid competition between staff (unless the country has a higher MAS score such as the Philippines) and create group incentives rather than individual bonuses.
The focus should always be on relationships and not the task, and time should be invested to strengthen relationships with staff in return for their loyalty. The boss should never single out or embarrass employees as this will erode trust and disrupt the harmony. As a foreigner, bosses are not part of the in-group and they are not trusted, thus they have to invest in building trust and long-lasting relationships.
What can the boss do to build trust and create a good working environment for staff?
- Know your staff, where they are from and what their personal interests or hobbies are. Remember their names and if they are married, if they have children, how many children they have, their ages and special occasions that they are celebrating
- Use nicknames respectfully
- Organise social events for staff; bills should always be picked up by the boss
- Gifts for special occasions should be presented to staff from the boss
- Buy snacks for the office and distribute them. Especially when travelling, bring back some cookies or chocolates from other countries
- Offer shared incentives rather than competitive rewards
- Request deadlines rather than ordering it
- Southeast Asian staff develop loyalty to a person rather than a company
- The importance of relationships should also be extended to customers
- Southeast Asian employees enjoy a sense of ceremony - celebrate birthdays with a small gift, a card and a cake or snacks that everyone can share at the office
Some Retention Strategies
- Be a caring mother/father as a boss, and guide and protect your employees
- Build strong, long-lasting relationships
- Upskill staff through training
- Offer English lessons to interested staff in Vietnam and Thailand
- Create a good working environment resembling a family
- Give performance-based group bonuses or incentives for higher MAS countries such as the Philippines or offer a savings plan
- Recruit staff constantly
- Use staff as scouts
- Leverage your ‘brand name’
- Engage in community service projects
- Use internships
How to Motivate Staff (MAS)?
In Southeast Asia, Thailand scoring 34 (Pyramid) and Vietnam 40 (Family) have lower Masculinity (MAS) scores compared to their Southeast Asian neighbours, affecting the way a boss will motivate employees. Status and visible symbols of success are important but it is not always material gain that brings motivation, but rather consensus and a good quality of life. Conflicts are resolved by compromise and negotiation. Incentives such as free time and flexibility are favoured. An effective manager is a supportive one, and decision-making is achieved through involvement. Singapore (Family) scores below 50 on this dimension, Malaysia (Family) scores 50 and Indonesia (Family) scores 46.
As for other more MAS Southeast Asian countries, such as the Philippines (Family) scoring 64, people “live in order to work”, managers are expected to be decisive and assertive, the emphasis is on equity, competition and performance, and conflicts are resolved by fighting them out. Employees can be motivated by group bonuses or other monetary incentives and awards or by promoting staff.
Implementing Structure vs. Flexibility (UAI)
Southeast Asian Family cultures mainly score low on the Uncertainty Avoidance (UAI) dimension indicating that they prefer flexibility when executing tasks and less rigid policies and procedures. Thailand (Pyramid) is an exception with the highest UAI score in Southeast Asia of 64. In order to minimize or reduce a high level of uncertainty, strict rules, laws, policies, and regulations are adopted and implemented. The opinions of experts are important and the ultimate goal of this population is to control everything in order to eliminate or avoid the unexpected. As a result of this high UAI characteristic, the society does not readily accept change and is very risk adverse. Change has to be seen for the greater good of the in-group. For meetings, agendas can be used to inform staff what will be discussed and the boss should check staff’s ideas prior to a meeting and discuss and agree what needs to be said during the meeting to eliminate any unknown factors. The boss will be looked to as the expert, making decisions on behalf of the department or office.
Short case study
Retaining Key Local HR Talent in Asia - 10 Tips for CHROs (LINK)
We recently met with an American Chief human resources officer (CHRO) who was visiting Singapore. We spent 30 minutes lamenting the loss of her talented Asia HR Leader to another company. The CHRO could not understand why the high performer had left. The company, a leader in its field, had promoted this individual quickly; paid them handsomely in base salary, bonus, stock options and retention bonuses; offered work/life flexibility; supported them in building a high performance regional team; offered a global assignment, and the list goes on. From the CHRO’s perspective, facts would appear to indicate that their Asia Pacific HR Leader’s situation was unbeatable and there would be little or no retention risk. Now after two years, this CHRO is forced into another external search to fill this valuable position.
When hiring staff in South Asia there are multiple factors to take into account. One of the main factors to consider is looking at each culture and the way employees are motivated. As in the above example, never assume that monetary awards will be enough to keep employees happy, consider the MAS dimension and what the main modes of motivation are for each country. That being said, all dimensions play an important role and the combination of dimensions should always be studied as a whole. Another important part to look at is organisational culture and how employees fit in the office culture.
References & Links