Retaining better than recruiting

According to the International Business Report (IBR) 2008 survey conducted by Grant Thornton, globally, 59 per cent of businesses are paying more attention in the search for and retention of employees than they were a year ago.

Ranked No 31, with 53 per cent, Thai businesses lag behind other emerging Asian economies such as Vietnam and China, which were rated No 1 and No 2 on the chart, and scored 84 per cent and 81 per cent, respectively.

Peter Walker, senior partner at Grant Thornton Thailand said, "Attracting and retaining the right employees is crucial for business success ... When you factor in all the costs, it is far cheaper to look after the people you have rather than continually shop for new people. Companies that invest heavily in the recruitment process but fail to retain their talent will lose their competitive position."

To attract more employees and retain them, most Thai businesses monitor and act on employee perceptions, train top performers for leadership positions and provide training and development packages to employees. The survey said businesses put less emphasis on offering competitive compensation, providing health benefits or allowing flexible working hours.

Most global companies (64 per cent) said they work to retain employees by engendering strong employee loyalty. They do this by ensuring that all employees understand the company's core values. Fewer than half of Thai companies say they use this approach.

Realising the value of human assets, globally, businesses say they allocate more money for staff training and development and provide more competitive packages. The survey shows 63 per cent of companies are paying more in staff costs than a year ago. However, only 45 per cent of Thai businesses reported higher staff costs.

Skill development is critical to improve productivity and competitiveness for all enterprises. The report also looked at some of the skills business leaders felt were weak or lacking in their teams. From the survey, English language, financial management and business planning skills are the top-three priority areas of skill-development as reported by Thai businesses.

Reversing results from previous years, computer skills are now low on the list, with only 3 per cent of Thai respondents citing this area as a weakness for their company.

"The skilled-labour shortage is forcing businesses to improve their reputation as employers," Walker said. "This is not just in terms of improving compensation; businesses have to adopt a holistic HR management approach, such as [providing] work-life balance, employee well-being and flexible working practices. Another strategy gaining popularity among businesses around the globe is [to implement] an ethical Corporate Social Responsibility framework to attract and retain the right people.

"... Employers need to build an environment where employees can support career interests and feel they are contributing to society in general."