Indonesians firms worst in leadership, communication

Indonesians firms worst in leadership, communication

Fitri Wulandari, The Jakarta Post, Jakarta

Indonesian companies are among the worst in the Asia Pacific
in terms of leadership and communication between executives and
employees, according to a new survey.

However, they are the best in the region in terms of employee
recruitment and retention, the survey showed.

David M. Knowles of the Watson Wyatt Human Capital Group said
Indonesian companies tended to expect senior leaders to make
company decision on their own, putting aside input from
employees.

He said a hierarchical relationship contributed to this
situation, which further widened the gap between employees and
their leaders and disrupted communication.

"Leaders often cannot give a clear reason behind their
decisions to the employees. On the other hand, senior leaders
have little trust in the employees," David said on Wednesday.

As a consequence, employees are not well-informed about the
company's projects, policies or strategies, he said.

Knowles noted that Indonesian companies failed to engage
employees in decision-making or to solicit input from employees
or gauge their perceptions and feelings through employee surveys.

Leadership and communication were among the factors used to
obtain the Human Capital Index (HCI), which describes the
relationship between human resources, management practices and
shareholder value.

The HCI survey, the first of its kind to be conducted in the
Asia-Pacific region, involved 500 companies from China, Taiwan,
Hong Kong, South Korea, Indonesia, Malaysia, the Philippines,
Singapore, Thailand, Australia and New Zealand.

Thirty-five publicly listed Indonesian companies were included
in the survey, with 74 percent of them being local companies and
26 percent multinationals. Among the companies were high-profile
companies such as Astra International, PT Semen Gresik, Bimantara
and Charoen Pokphand.

Watson Wyatt suggested that companies adopt a more open style
of communication and obtain input from employees, which would
lead to improved market value.

The survey also shows that Indonesian companies are doing
better than other companies in the region in terms of recruitment
and retention.

"Indonesian companies investment a great deal for recruiting
people, for example by employing headhunters, and have good
retention programs such as pensions and benefits," Knowles said.

While they invest a great deal in recruitment, Knowles noted,
Indonesian companies do not have effective internal recruitment
systems and rely on headhunters and third parties to manage the
process.

As for benefits, he said, Indonesian companies have clear
benefits program such as salary and pension.

"Indonesian companies have retention programs such as pension
and health which are much better than other countries," he said.

Overall, Indonesian companies scored 55 percent in the HCI,
higher that regional average of 50 percent.

According to Knowles, the survey can help companies set up
better human resource programs, which can increase shareholder
value.