Growing HR in Vietnam, Cambodia (Guest commentary)

Trip by Canadian HR professionals provides global view
By Diane Wiesenthal
|Canadian HR Reporter|Last Updated: 03/07/2010

One thing becomes clear when travelling to vastly different regions of the world — there are remarkable similarities and remarkable differences that both distinguish and unite HR practices.

In the May 4, 2009, issue of Canadian HR Reporter, I shared the experiences of a delegation’s trip to explore HR practices in China. Now, the group is back from its trip to Vietnam and Cambodia with fresh lessons from a developing region. (For more information on the program, see sidebar. To view the China article, go to www.hrreporter.com, click on “Advanced Search” and enter article #6857.)

Growth in a developing region

Everything is growing in Vietnam and Cambodia. It’s a world of neon green, lush, steamy jungles and bustling cities that are alive with a sense of determined chaos and a fierce entrepreneurial spirit. Scooters — loaded with all kinds of cargo — teeter precariously, yet move with expert balance through an unending maze of traffic.

HR management is taking root in a big way in these developing economies. It is also teetering precariously among a complex maze of underdeveloped political and legal frameworks.

Culture and political and environmental forces have a strong impact. Not on the design of HR programs and services — which are remarkably similar — but rather on the capacity to deliver on people and organizational services that operate under various external influences. This illustrates, yet again, that in order to be effective, strong HR programs and services must work in harmony with culture as well as political, environmental and organizational goals.

Growth of organizational development

To understand companies, organizations and people in Vietnam and Cambodia, it’s important to learn a bit about the history and culture of the land and its people.

In Vietnam, the people refer to the Vietnam War as the “American War.” They harbour no grudge against the West — they have forgiven and are moving forward.

In Cambodia, the people were subjected to unimaginable horrors under the Khmer Rouge. As we walked among the killing fields, there was a deathly silence in our group as we witnessed the evidence of the human destruction.

Particularly in Cambodia, the demographic unbalance due to violent human intervention is visibly noticeable. The older generation is the vast minority. This has had a dramatic impact on the capacity of educational institutions, companies and organizations to fill the knowledge void. This knowledge gap will be felt for some time to come.

Despite these extreme hardships, the people of Vietnam and Cambodia remain optimistic and entrepreneurial. In many respects, this resembles traits we found in the people of China. By contrast, people in the Western world generally have a tendency to focus on “what we don’t have” versus “what we have.”

In Canada, we tend to throw more and more money at problems with the blind hope the situation will improve. It begs the question: Are we simply buying complacency and a sense of entitlement? Or is this sense of entitlement systemic or cultural in nature, as it is also alive and well in some people, unions and organizations? It’s not a healthy concept, as we are not questioning what’s reasonable and right to balance both employee and organizational needs.

Growth of learning, development infrastructures

Despite extreme challenges, there are rays of hope that signal a brighter future for the people of Vietnam and Cambodia.

In Cambodia we visited a privately funded school and orphanage for children — of all ages — Pour un Sourire d’Enfant (“For a Child’s Smile”). The children are rescued from garbage dumps where they scour the dangerous trash in extreme heat to scratch out a meagre existence. The school provides shelter, clothing, food, education and the development of a trade skill so the children are able to work and have a future.

Universities are big business in Vietnam and Cambodia. There are more than 60 universities in Phnom Penh alone, with more than 700 universities in Cambodia serving only two million people. Most universities focus on business training such as accounting, finance, banking and marketing, with the HR management program just evolving in the past five years. The National University in Phnom Penh serves 15,000 students with double full-time shifts — full-time day students and full-time evening students.

But it’s still a challenge to find teaching expertise. Vietnam and Cambodia — and China too — don’t have strong academic and practical HR management knowledge readily available. As a result, standards of education for HR are led and organized by multinational companies.

Growth in governments

In Vietnam, our delegation met with the minister of labour. The ministry is a large portfolio because of the enormous size of the labour force and market. Education appears to be the largest challenge due to a lack of standards. And there are also some unique challenges — for example, the country has too many doctors and not enough skilled tradespeople.

Another intriguing angle is the state invests money in companies and, therefore, it’s able to regulate compensation with minimum wages and, more interestingly, an established maximum wage. Yet, the government estimates about one-quarter of the workforce is underpaid, despite regulations and labour laws.

The economy is further complicated by extreme fluctuations in inflation and most commodity transactions occur in United States currency, which adds an element of market stabilization.

While health and safety laws are virtually non-existent, there is a practical approach to safety. But insurance programs are being introduced as wage protection for workers. There are also minimum working-age requirements, but it’s easy to get around the rules.

To further complicate the system — in what resembles the Cold War spy days — a hidden communist body in Vietnam works within companies to channel information to the government to ensure companies are following party guidelines. We were also told, when labour disputes occur, “no employer has ever won a court case.”

Growth of commerce, industry

Large organizations we visited had surprisingly sophisticated HR programs, but the contexts in which they operate are very different than in North America. The companies are unable to deal with hugely inefficient and ineffective systems, and are at the mercy of government systems where employees can do no wrong, there are little or no consequences for inappropriate behaviour — both on an employee level and union level — and there appears to be no shred of personal accountability, at least among those who lack the personal fortitude to “do the right thing.”

In this regard, there are notable similarities to North American work culture. However, given the economic and political framework in Vietnam, the infrastructure makes it increasingly difficult to execute on a strategic plan.

There is a significant market for HR consulting firms to help navigate the complex system between government regulations and business operations. In a meeting with a highly successful consulting company, it was apparent there is a significant demand for HR knowledge and expertise. Payroll outsourcing is big business while other services such as temporary employment are not yet utilized. There are significant challenges for companies to source and retain talent which, to some degree, is indicative of a global issue.

Business federations are also emerging with “HR clubs” where HR practitioners meet to discuss common issues. This is no doubt the beginning of a future HR association. The goals of these federations are to unify and strengthen the private sector and enable members to compete in the global economy.

There is certainly a common desire by business and government to create a positive work environment for employees to develop and advance. Structured HR programs are evolving in larger organizations, covering the traditional gambit of job evaluations, competitive compensation programs for all staff at all levels, talent-retention programs, recognition programs to foster innovation and revised recruitment techniques.

In Vietnam and Cambodia, the younger generation is highly mobile, typically changing jobs every two to three years — the basic philosophy being, if they don’t get paid enough, they’ll find another job. This is a similar trend that exists in North America and China, despite vastly different infrastructures, cultures and work environments.

Growth of HR’s role around the world

So what does all this mean for HR professionals and leaders? It means being a change agent to leverage organizational development and effectiveness. It means investing in learning, development and education to build accountability and leadership capacity in our own organizations.

That means having the courage, desire and capacity to lead and effect a meaningful difference that prevents people from holding leadership positions for the purpose of assuming personal power and control which, as history has shown, can lead to disastrous results on a country or organizational level. And it means making tough decisions to ensure productive and valued employees are not subjected to poor or unacceptable management and leadership practices or poisonous behaviors and attitudes from co-workers.

If we can spark and inspire ingenuity and innovation — and keep it in its purest form, without corruption and complexities — we will succeed in achieving mass people engagement. By replacing complacency with pure and real engagement, people working together towards a common goal can achieve the impossible.

Our goal as HR practitioners is to begin to demonstrate how treating people right benefits economic development through a profound impact on wellness and health. How do we take on the mammoth task of making the world a healthier place when we struggle to manage this even on an individual level? It appears there is only one way — by helping one person at a time. That is, to build accountability and equip individuals with the proper tools and knowledge to challenge the status quo and sustain ongoing improvements on a personal and organizational level.

Diane Wiesenthal is vice-president of people and organizational services at the Canadian Wheat Board. She is past president of the North American Human Resource Management Association, the Canadian Council of Human Resources Associations and the Human Resource Management Association of Manitoba.


About the program

Goals of the global journey

The second Canadian HR delegation through the People to People Ambassadors program completed its mission to Vietnam and Cambodia in October 2009. The program was established in 1956 under the leadership of former United States president Dwight Eisenhower.

The goal of the delegation was to study HR practices in those two countries and compare these findings to what was discovered in a 2008 trip to China and to the practices common in North America. This provides small but powerful insights into the global HR community and the evolution of the HR profession across various economic regions.

The delegation examined: population demographics, organizational development, talent management, total compensation structures, cost of living, standard of living, learning and development infrastructures and emerging laws and legislation.

Next up: Israel

The third Canadian HR delegation will be travelling to Israel in 2010. It will depart on Oct. 22 and return to Canada on Oct. 30. To join the delegation or for more information, visit www.citizenambassadors.org.

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