1 HUMAN RESOURCE PLANNING 1.1 Company Information Established in 1973, ABC Shipyard Pte Ltd is a mid size shipyard located in the west region of Singapore. Our yard has the capabilities and expertise to undertake repair, upgrading and conversion for a diverse range of offshore and marine vessels including chemical and oil tankers, container and cargo vessels, passenger ships, gas carriers, navy ships and dredgers. Marine industry in Singapore is booming, contributing more than 1% to the GDP of Singapore and is expected to achieve double digit growth for the foreseeable years. However, the 2 key factors that impede the growth of any shipyard into mega yard is the scarcity of land and labour. Management of ABC Shipyard Pte Ltd has decided to venture overseas, in particular, acquisitions of shipyards in China, India and Indonesia. The senior management team has decided on direct management of overseas yards. All the top management in overseas yards will be posted from Singapore. The acquisition process of China yard is expected to complete by the end of 2008, and the yard operational in the 2nd quarter of 2009. Negotiation for acquisitions of India and Indonesia yards has yet to conclude. Management hopes to the acquisitions to go through and the yards operational in 2010.
1 HUMAN RESOURCE PLANNING
1.1 Company Information
Established in 1973, ABC Shipyard Pte Ltd is a mid size shipyard located in the west region of Singapore. Our yard has the capabilities and expertise to undertake repair, upgrading and conversion for a diverse range of offshore and marine vessels including chemical and oil tankers, container and cargo vessels, passenger ships, gas carriers, navy ships and dredgers.
Marine industry in Singapore is booming, contributing more than 1% to the GDP of Singapore and is expected to achieve double digit growth for the foreseeable years. However, the 2 key factors that impede the growth of any shipyard into mega yard is the scarcity of land and labour.
Management of ABC Shipyard Pte Ltd has decided to venture overseas, in particular, acquisitions of shipyards in China, India and Indonesia. The senior management team has decided on direct management of overseas yards. All the top management in overseas yards will be posted from Singapore.
The acquisition process of China yard is expected to complete by the end of 2008, and the yard operational in the 2nd quarter of 2009. Negotiation for acquisitions of India and Indonesia yards has yet to conclude. Management hopes to the acquisitions to go through and the yards operational in 2010.
1.2 Management philosophy
The management philosophy is "Provide excellence to all our stakeholders". To our customers, we provide excellent service. To our shareholders, we provide excellent returns. To our contractors and suppliers, we provide excellent support so that we can grow together.
Over the years, the management has adopted the working principle of "under-promise and over-deliver". This has resulted in many happy customers and suppliers who trusted us for more than 30 years.
1.3 HR Philosophy
To our employee, our human resource philosophy is to "Provide excellence to our employees who are our most important asset". This is done through:
a. Hire excellent people
b. Maintaining harmonious industrial relations
c. Train and develop excellence
d. Excellent compensation and benefits package
e. Structured talent development
We believe in the principle of equal employment opportunity. We tacitly adopt the Tripartite Guidelines on Fair Employment Practices even before the publication of it.
An important principle as laid down in Tripartite Guidelines states: "Recruit and Select employees on the basis of merit (such as skills, experience or ability to perform the job), and regardless of age, race, gender, religion, family status or disability."
In ABC Shipyard, we abide by the tacit agreement of not poaching employees from our customers and suppliers. In the event that employees of our customers or suppliers approach us for job application, we make it known that job offer will be made only when our customers or suppliers is agreeable.
Whenever a vacancy is open, we source internally and externally concurrently. This is in line with our principle of equal employment opportunity.
All candidates are selected on the basis of merit. As a result, ABC Shipyard benefits from diversity and experience of both external recruits, and staff are motivated to upgrade their skills in order to complete with outsiders for higher postings.
1.4 Our People
ABC Shipyard has staff strength of 540. The core group of management staff, administrative and support staff, supervisory staff numbered at 130. All of them are Singaporeans or holding Singapore permanent resident status.
The bulk of our workforce is made up of skilled manual workers, such as fitters, welders, painters, blasters and mechanics. Most of them are workers from India, Sri Lanka, Thailand, Bangladesh, Myanmar, Philippines, Pakistan, collectively classified as non-traditional sources (NTS) workers.
As NTS workers are all work permits holders who can only work in Singapore for a stipulated period of time. Till date, less than 20 NTS workers succeed in gaining permanent residency in Singapore, and they are now holding supervisory duties in the company.
As ship repair and conversion work are highly labour intensive, the labour force is supplemented by more than two thousands workers from our resident labour suppliers.
ABC Shipyard Pte Ltd has 20 resident contractors. Under Ministry of Manpower regulation, ABC Shipyard Pte Ltd is responsible for the work permit applications and renewals of our resident contractors. The responsibility is given to the HR department.
2 Recruitment strategy for senior human resource manager
2.1 Vacancy Arising
Our China shipyard is due to open in the 2nd quarter of 2009. Management of ABC Shipyard decides to post the Senior Human Resource Manager to China to oversee the Human Resource Department. This vacancy is newly created as a result of Management's decision.
2.2 The Ideal Candidate
The ideal candidate loves challenges and is a risk taker. This person will enjoy the challenge of setting up the Human Resource department in a new yard. This person will not bow to the traditional method of management, but he or she will work out (through trial and error) the most effective way to run a completely new department.
This person will report directly to me, and when our opinions differ, I expect him or her to come out with strong arguments to convince me on why things should be done his or her way.
This person must have the ability to make both Singaporean and native Chinese feel like "this person is one of us, we will not treat him or her as foreigner." Preferably this candidate has working experience in both China and Singapore.
If not, this person must show proof of cultural adaptability.
The ideal person is a fast learner. While I do not expect this person to come from the marine industry, I do expect this person to learn the rope of the marine industry fast.
The ideal person must be able to see the current challenges and foresee the future challenges facing the marine industry in Singapore and China. I expect him or her to come out with workable solutions, and has the ability to convince everyone, from top management to floor, to embrace the solutions.
As a Senior Human Resource Manager, I expect this person to know the competency of key persons in the new yard. In addition, the holder of this position must be able to recognize talent and potential.
The candidate must be willing and able to train line managers to develop the same talent-spotting ability. He or she must be able to realize the potential of staff in the shortest period of time. The ideal candidate loves talent so much so that he or she will bribe, beg and use whatever means to keep talent in the company.
Based on the above, a detailed job description and knowledge and skills requirement are drawn (see Appendix)
2.3 Recruitment Sources
In line with our principle of equal employment opportunity, we will do internal and external sourcing concurrently.
2.3.1 Internal Sourcing
A copy of the job description will be posted in the company intranet. An email will be sent to all staff informing them of this vacancy. Interested candidates are invited to submit their applications through the Human Resource Department.
Employees are encouraged to invite their friends and relatives who meet the requirement to apply for the job.
While interested candidates need not submit their applications through their department head, they are encouraged to discuss their interest with their direct supervisor.
We have found that when employees are required to submit applications through their department head, the department head often suppressed the applications. Discouraged employees ultimately left the company.
Internal sourcing usually yields candidates who are familiar with the industry, company and the job scope. They have the added advantages of knowing why the vacancy exists, and of knowing the supervisor they will be working under. Internal candidates usually fit better into the new department.
However, for the HR Department, this means that double work as another vacancy is created as a result of successful internal placement.
Employee referrals also yield candidates who are better fit with the company's culture. These candidates have the advantage of having an informal mentor who has mentally and emotionally prepared them for the job. The Company Code of Conduct and Ethics prohibits direct supervision of relatives.
2.3.2 External Sourcing
As this is a senior position that we are recruiting, we are using the service of an executive search firm (commonly known as the headhunter).
Firstly, the senior person that we are recruiting is unlikely to read the Classified section of The Straits Time to look for job. He or She is likely to be holding a senior position and as likely to be working in China as Singapore.
Secondly, the recruitment methods that are used for recruiting high volume of lower level positions, eg job fair, campus recruitment, internal job positions etc, are not suitable for a senior level recruitment.
Thirdly, the HR department is not experienced in handling the recruitment and selection of senior position. For example, HR Department is simply not experienced enough to screen the resume of the potential candidates.
Lastly, the key reason for using an executive search firm is to save time and effort involved with identifying, qualifying and reviewing potential candidates for this senior position.
An article in HR Magazine highlighted the following points which I will adopt when using the executive search firms:
find out exactly who would be conducting the search, and make sure the person demonstrates the knowledge and professionalism necessary to represent the company to its prospective candidates;
Obtain a list of searches for similar positions that the consultant has conducted during the past few years, then interview several references before signing a contract;
Ask the consultant about business relationships that might affect the search, because big firms may work with companies that compete with ours, and they can't tap into these resources;
Negotiate for contingency arrangements that allow us to pay the fee only after the position is filled. I will also study the fee structure to understand the fees, possible extra charges and replacement policy.
Ideally the contract should stipulate the firm will replace the employee if he or she leaves within 12 months for any reason and charging only for expenses;
Ideally the firm check candidates' qualifications, employment history, and civil and criminal records.
Ask about follow-up services. The consultant's responsibility does not end when the candidate is placed. I look for firms with resources and methods that help new hires assimilate. The search consultant should provide feedback from new employees that can help us fine-tune our assimilation process.
The cost of using executive search firm is estimated to be S$25,600, the computation is based on commission of 20% annual salary, assuming a basic monthly salary of S$8,000, and 4 months bonus.
Accordingly to statistics provided by Ministry of Manpower of Singapore, the basic monthly salary of HR Manager in 2006 ranges from S$4,200 (1st Quartile) to S$8,324 (3rd Quartile). We are prepared to offer the candidate a basic monthly salary that ranges from S$7,000 to S$9,000.
While the cost of using the executive search firm is high, the benefits outweigh the costs. The executive search firms maintain broad networks and have specialized databases of people with rare skills and talent. Without the help of the search firm, we are unable to reach out to these people.
3 SELECTION STRATEGY
Selection of a Senior Manager must be done differently from selection of a fresh graduate. The main reason is that candidate for senior management position is backed by concrete working experience (in many case, the reputation spreads far and wide), while a fresh graduate is untested, thus assessment methods such as psychometric testing, highly structured interview and assessment centre are used to gauge the capacity of the candidate.
If we subject the candidates for senior management position to psychometric testing, highly structured interview and assessment centre, they will feel that we are insulting them.
Secondly, the organisational fit is less crucial for a senior management candidate, because he or she has the power to change it, and in fact, he or she is expected to overhaul the existing sytem to make it more efficient. But a fresh graduate is expected to fit in, and not to initiate any change to existing system.
3.1 Preliminary information gathering
The preliminary information gathering is done by the executive search firm (for external applicants) and the HR Manager (for internal applicants). I would expect the search firm and HR Manager to give me a detailed resume of suitable candidates, and an interview evaluation reports on each and every one of the candidates.
The detailed resumes should contain the following:
Job histories and reason for leaving
Main jobscope in each job
Salary and renumeration package for each post held
Main achievements at work, eg in charge of setting up oversea office.
A write-up on the candidate's HR vision and philosophy
List of three references who are not family members or relatives
This interview evaluation report should contain the following:
1. a summary of the interview
2. selection criteria used by the consultant/HR Manager
3. consultant's/HR Manager's evaluation on why he/she thinks the candidate is suitable for the post.
4. Ranking of the candidates in term of suitability for the post
The consultant/HR Manager must submit a list of candidates that he/she has rejected, with attached resumes and interview evaluation report on each and every one of the rejected candidates. This will let me gauge the performance of the consultant/HR Manager as well, and to prevent the selection of unsuitable candidate and rejection of suitable candidate.
3.2 Background Investigation
All candidates referred by the executive search firm must authorise in writing for us to conduct background investigation. The search firm is to undertake all background investigation. A flat fee is payable when the candidate is from internal recruitment source.
I will select 3 candidates for the executive search firm to conduct background investigation on:
validity of academic qualification
reference check on the work performance (of at least 3 previous companies) from both immediate supervisor and subordinates.
The focus of the background investigation is to confirm the truthfulness of the resume. The integrity of the candidate must be beyond any doubt.
I will select the 5 candidates for backgound check based on:
1 proof of calculated risk taking
For example, the candidate ever joined in mountain expedition, or that the candidate has experience in building up a new division
proof of cultural adaptability
The candidate studied overseas or worked overseas, or undertook a mission overseas (eg religious mission or voluntary group)
2. proof of learning ability
The candidate possesses good academic qualifications and shown proof of continuous upgrading. The candidate shows proof of breadth and depth in the jobscope.
3. proof of good talent management
This can be gleamed from the HR Vision and Philosophy held by the candidate.
3.3 Selection methods
Based on the resumes, candidate's written HR Vision and philosophy, consultant's/HR Manager's evaluation and background investigation, I will select 3 candidates for an interview. The 3 interviews are the Chairman, the Chief Executing Officer and myself.
We will not use highly structured interview, even though research has shown this to be more valid than unstructured interview. The reason is that highly structured interview is not commonly used for senior management position. The candidate will definitely feel humiliated and insulted if we subject him to it.
On the other hand, unstructured interview has low validity. It will also makes candidate feel that we are not prepared for the interview.
We have decided on a semi-structured interview. Instead of specific questions that are common in highly structured interview, we have decided on a few board areas to cover in the interview, these areas include:
1. the candidate's viewpoint on the corruption or perceived corruption common to business dealings in China, and how should we deal with the corruption. (Purpose of asking this is to guage the candidate's integrity and flexibility in dealing with corrupted government representatives and businessmen).
2. Candidate's experience living or working with people from (or in) China. (Purpose of this is to guage cultural adaptability and to discover any bias that the candidate has against mainland Chinese).
3. An overall plan of setting up HR Department. (This is to guage ability of the candidate to set up and manage a new HR Department, and to guage the candidate's depth of understanding the various HR functions).
4. Candidate's philosophy of talent management and how it can put in practice. (This is to guage how good the candidate is at talent spotting and management.)
5. Candidate's renumeration expectation.
Candidate's assessment of global marine industry outlook and how this impacts on the human resources in Singapore and China. (This will show how well the candidate is prepared to work in this industry and in our company).
6. Candidate's aspiration and career plan. (As this position is second only to me, I want to groom this person to take over my position).
3.4 Final Selection
Final Selection is made by consensus. While all the three of us need not like the candidate personally, we must feel comfortable and confident to let him run the HR department in China yard.