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Equine Capital Berhad The Impacts of Strategic Planning Applied in Human Resource Management Based on Four

Paradigms: Linkage, Directional Strategy and Goal Setting, Forecasting & Recruitment Process

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Equine Capital Berhad (ECB)

The Impacts of Strategic Planning Applied in Human Resource Management Based on Four Paradigms:

Linkage, Directional Strategy and Goal Setting, Forecasting & Recruitment Process

1.0 Executive Summary

Equine Capital Berhad (ECB) ± as our subject in this essay ± is a property developer

enterprise established since 1992 that focuses on the niche of township development

including residential and commercial properties. Besides primarily focused on properties

development, the organization that holds under it nine subsidiary companies also partially

provide recreational and equestrian activities and security services. The essay seeks to learn

from the major corporation¶s failure of integrating strategic human resource

management in determining the direction of the organization. It shall be discussed

based on four perspectives, the linkage between human resource management

(HRM) function and strategic management, directional strategy and goal setting,

HR demand and supply forecasting, and recruitment process; primarily revolving

around literature review and qualitative resource of data through interview with the

ECB corporate Human Resource Manager, Miss Wong Siau Ying and follow-up interviews

with random employees. In the initial process, the subject had failed to secure the HRM

function in a strategic position within the organizational chart, which represents the lack of

strategic human resource management function implemented in the organization. In order to

improve this, changes have to be implemented and it is a difficult task in making changes

within organizations.





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2 .0 Introduction

ECB, as a property developer, ECB not only attends to the needs of its environments¶

commerce aspects, but also for residents of the area. Indirectly, ECB contributes to nation

building by creating space for society to grow. The last financial report has shown that the

organization¶s financial performance had dropped. ECB¶s prospects plans are focusing more

on market share and on higher end property development activities to encourage and generate

attractive yields and returns. From developing residential and commercial properties ranging

from low to high price, ECB now shifts its marketing strategy towards focusing on thehigher-income target, whereby its end products will be set at a higher price in the market,

promising quality as its differentiation strategy. From the case of ECB, it shall be a lesson to

be learnt that in order to sustain, an organization needs also be proactive rather than reactive.

The essay also seeks to provide recommendations to be implemented in ECB¶s strategic

human resource management.

3 .0 Literature Review

Within the last two decades, there has been a number of important contributions in the

literature dealing with issues pertaining to the management of people. Significant attention

has been directed towards human resource management (HRM), which many have seen as

representing a distinct approach to managing people (Guest, 1997). Interestingly, although

researchers have highlighted the holistic nature of HRM, much of the initial research into the

concept focused on a limited range of issues and has been criticized as `micro analytic'

(Delery and Doty, 1996). However, in the last decade, researchers have sought to show theimportance of HRM in influencing organizational performance and it is from this premise

that the current interest in SHRM has developed (Cappelli and Crocker-Hefter, 1996).





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Rapid environmental change, globalization, innovations to provide competitive products and

services, changing customer and investor demands have become the standard backdrop for organizations. To compete effectively, firms must constantly improve their performance by

reducing costs, enhancing quality, and differentiating their products and services. To improve

firm performance and create firm competitive advantage, HR must focus on a new set of

priorities. These new priorities are more business and strategic oriented and less oriented

towards traditional HR functions such as staffing, training, appraisal and compensation.

Strategic priorities include team-based job designs, flexible workforces, quality improvement

practices, employee empowerment and incentive compensation (Jing and Huang 2005).

SHRM was designed to diagnose firm strategic needs and planned talent development which

is required to implement a competitive strategy and achieve operational goals

(Huselid et al., 1997).

4 .0 ECB HRM Department s Practices

Since our essay focuses on the strategic planning process, therefore the subject¶s HRM

functions shall be discussed initially with the processes of deciding on a strategic direction by

defining the organization¶s mission and goals, its external opportunities and threats, and its

internal strengths and weaknesses.

Table 1 : Strategic Management Process Model





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In the strategic management process model above, there are five components that are relevant

to the strategy formulation by the HR input, including the mission , goals , external analysis ,internal analysis and strategic choice of the organization. Idealistically, it is ECB¶s HR

department¶s role to ensure that the organization¶s human resource contributes to its

competitive advantage. This is where the strategic formulation process becomes crucial.

The five components are taken into account in order to determine the best ways it could

sustain in the market.

Table 2 : Human Resource Input





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4 .1 Mission

The mission of an organization is basically the statement of the organization¶s reason for being.

ECB Group moves forward with the mission to create space and value which fulfills the needs

and exceeds the expectations of all stakeholders. ECB¶s mission becomes their commitment and

guide towards long term sustainable growth, returns and enhancement of value. This mission

guides its core competency of nature of business.

The HRM Department of ECB formulates its own mission parallel to the corporate mission

whereby it lays out five Core Values of its human resources attributes in the conduct of the

businesses of Equine, as their role behaviors requirement namely:

1. Customer-focus: Pay attention to customers' needs in order to satisfy all stakeholders

according to the mission.

2. Value: Give value for money through supply of high quality and reliable products; in order

to meet the goal of providing efficient space according to the corporate goals.

3. Responsible: Act in a responsible manner and be responsible for one's action; according to

its concentration strategy, work in ECB is very functional in order to encourage efficiency.

4. Teamwork: Acknowledge diversity and people, believe in teamwork

5. Commitment/Dedication: Commit to achievements with a passion for success





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4 . 2 Goals

ECB¶s goals ± which are what it hopes to achieve in medium to long term future ± are to

provide affordable, efficient, comfortable living and work space that enables users to

achieve high living standards in an ecologically balanced environment. ECB compares

itself with the artisans of old whereby they are committed to excellence and are guided by

the desire to be achievers, not merely accumulators. The goals formulated determine its

marketing strategy, which is to focus on niche market, and also its d irectional strategy ,

currently in the concentration approach of focusing on geographical target market.

4 . 3 External Analysis

In order to determine opportunity and threats, an organization needs to examine its

operating environment. This shall equip the organization with the knowledge of effective

strategic choices in contemplating what should be undertaken and what to avoid.

In the perspective of input by HRM function, opportunities of having more talented

workers, based on its mission and goals ± to provide affordable, efficient, comfortableliving and work space that enables users to achieve high living standards in an ecologically

balanced environment ± could have been grasp if the HRM function works parallel with

this strategy in recruiting and shaping its employees in ways that can contribute to this

mission and goals, for example, employees that have the awareness of the environment, or

the least, forecasting its demand or surplus of employees earlier in order to avoid negative

circumstances on work flow process.

In other illustration, ECB should recognize the trend of the external talent pool that consists

of younger generation of workers that are very knowledgeable and forward-looking, which

is something that they need in order to achieve their goals. They should recognize the ways

in attracting the most suitable workers and go beyond expectation, just as stated in their





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mission, rather than just being acceptable which makes ECB survivor, instead of

performing beyond expectations.

4 . 4 Internal Analysis

In order to be effectively contributive to the organization¶s competitiveness, ECB¶s HR

Department needs to adopt better scientific management of information system tools in

order to analyze its internal strengths and weaknesses better. This is important since

knowing what are the organization¶s strengths and weaknesses provide rooms for

improvement for the organization. However, this is not practiced in ECB. Despite being alisted company, it is not fully acknowledging the importance of the HRM function in

contribution to its competitive advantage.

In preparing for a better operation system, ECB¶s HR Department merely process various

department¶s request of manpower by informal communication styles. Any void shall be

adjusted and sometimes be ignored. This is a big problem in the organization. The system

in order to track its movement within the organization relies only on paperwork filing

system. They do not practice any scientific HR forecasting tools such as the transitional

matrices.

4 .5 Strategic Choice

From the mission, goals are formulated in order to execute tasks in achieving the mission.

This then is equipped with knowledge of the knowledge of the organization¶s strengths

and weaknesses and its external environment¶s opportunities and threats, in order to

maximize the efficiency of the steps it takes. In other words, the strategic choice describes

the organization¶s strategies in attempt to accomplish mission and achieve long-term

goals. One of the superficial illustrations of ECB¶s strategic choice can be seen in its

organizational chart.





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Board of Directors

Corporate Property

Investor

Relations

The ECB Group's physical organizational structure are topped with the board of directors

that comprises of the Independent Non-Executive Chairman, YAM Datuk Seri Tengku

Ahmad Shah Ibni Almarhum Sultan Salahuddin Abdul Aziz Shah, the Independent Non-

Executive Director Datuk Ahmad Zabri Bin Ibrahim, the Independent Non-Executive

Director Dato' Hamzah Bin Md Rus, the Executive Director Othman Bin Mohammad, and

the Independent Non-Executive Director Wong Yuk Mou. Under the board of directors,

ECB¶s organizational chart could be seen divided into three parts namely, corporate,

property, and investor relations. In other words, the formal network of ECB can be seen as

both functional and client-divisional structure because of the integration of both work

specialization and the clients each department address.

Since the actual topography apparently is classified from this study, our group had

generated an illustrated simplified and superficial organizational chart (as can be seen

above) of the corporate division, which will be the focus of the study in this report. The

transparent information that we were able to retrieve in this study are the actual persons

who holds certain position within the management team of the corporate division. As we

were told by the subject of the interview ± Miss Wong Siau Ying the human resource

manager, the human resource department of ECB Corporate is under function of finance.

Table 3 : Functional Structure of ECB





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Therefore, the strategic choices are being carried out based on this network. In ECB¶s

case, the task of analyzing and designing w ork flo w is completely separated from its areas

of task. The work flow analysis and design is being carried out by each functional

department and to be submitted to the human resource department.

Three variables to be considered in strategy implementation in any HRM function within

an organization in order to back up its competitive advantage includes task d esign ,

re w ar d system and selection, training an d d evelopment of people. These variables

derive from the product market strategy in order to achieve great performance. However in

ECB¶s context, there are only two variables practiced, namely the reward system and

selection, training and development function.

ECB¶s HRM Department also holds limited responsibility in performance management ,

whereby it only approves of the needs of training and development, which is outsourced to

external training and development companies. Performance management tasks are beingcarried out by superiors of each department and are reported to the HRM Department for

reward purpose only. Workers¶ performances are on the basis of productivity and

efficiency, which is very mechanical .

Ex ecutive

Director

CorporateAdvisor

CompanySecretary

Chief FinancialOfficer

SeniorManager -

Finance

HumanResourceManager

Chief Operating

Officer

OperationsManager

(Batu Kawan)

ProjectArchitect

Table 4 : Corporate Structure of ECB





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The HRM Department of ECB is described to be strict in its actions whereby unwanted

attributes including affected pro du ctivity , absenteeism and tu rnover is judged harshly

and the organization does not gives much chances except for training and development.

The HRM function disregards the personal and specialty of each worker in the

organization.

On top of the absences of HRM function in strategic planning, ECB also disregard

contributions of ideas from its human resources for emergent strategy formulation. In

this case, emergent strategies are only formulated through financial report by end of

accounting period.

5.0 Problem Statement

5.1 Linkage Between HRM Function and Strategic Management Team

The ECB Group had assigned their Human Resource Department under the authority of

the Chief Financial Officer. The HR Department functions merely as an ad ministrative

purpose. In other words, the administrative linkage of the HR Department towards the

strategic management team is one way whereby the HR Department only carries out daily

administrative tasks. The HR Department is not required to contribute to the strategic

formulation process. Thus, it puts the organization not to be as alert and vigilant towards

any opportunities and threats that are faced. In this case, ECB becomes reactive ± instead

of proactive ± to the drop of revenue and starts on strategic formulation that focus merely

on marketing function, but still not recognizing the human resource department¶simportance to be integrated in making decisions process.





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5. 2 Directional Strategy and Goal Setting Contradictive

The directional strategy of the organization revolves mainly on geographical

concentration approach of the niche market of Seri Kembangan and Batu Kawan. In this

sense, ECB HR department sends its employees for trainings and development programs

every year in order to be parallel to the concentration strategy. This is the tactic in order to

retain their workers. However, the training and development program only revolves

mainly for efficiency purpose rather than actual career development potential.

Careerd

evelopment is a trait that ECB promises to its employees as a core value.However this is not much practiced. With more elder staffs retiring within the

organization, ECB needs to win the hearts of younger employees in the talent war. Much

of its failure can be related to its lack of differentiation strategy whereby previously, it

wants to target the low-cost and at the same time, the posh residential properties within the

same area such as in its previous Seri Kembangan target market. This is very contradictive

and inefficient marketing strategies could have been avoided if the employees work in a

more proactive way according to the environment when being given more responsibility.

As a result, the organization seemingly dormant trait causes much of the rise of

competitors.

Due to the fact that ECB¶s goal setting is completely separated from the HR department,

w ork processes become much of an application of scientific management approach within

the organization. This could also perhaps be related to the small size of the organization,

based on the number of its employees.





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5. 3 HR Demand and Supply Forecasting

ECB does not apply any scientific HRM tools such as the transitional matrices in

determining the movement of its talent pools. It depends solely on traditional filing

process. The organization does not even do any forecasting of its demand and supply of

workers in proper ways. The way they do it is whenever someone is leaving, the head of

that particular department shall inform the HR manager and this shall be updated annually

± which is a period that is quite long.

ECB experiences lack of its employee commitment whereby younger workers tend toquit and are not loyal to the organization whenever offered with better opportunities,

worse still, from ECB¶s competitors. However, the problem lies where the HR

Department does not get behind this and not fix this problem, but rather simply restrict its

selection of recruitment to older workers. There are many symptoms that are seen in this

problem namely the lack of career path development due to the work process that are

very rigid. The organization is not alert to changes in its environment. Employees work

according to what lies as their jobs, rather than using much of their mental abilities,

creativity and knowledge expansion. Employees ³come and go´ in ECB and this can also

be related to the fact that for last year, ECB¶s revenue has dropped due to the inability to

the delayed delivery of projects.

Employee commitment will be very significant in the near future in ECB¶s prospects due

to its concentration on the differentiation market of high-end properties that targets the

up-market.





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5. 4 Recruitment Process: Rigid Selection in Recruitment

The selection of employee recruitment is limited whereby the human resource

department of ECB only favors applicants in job interviews which are ³older´. Miss

Wong Siau Ying had mentioned that they particularly do not accept fresh graduates or

³younger workers´. This perception may derive from the connotation that younger

employees are ³not matured enough´. However, this also has caused ECB to lose out in

the sense of creativity and fresh ideas. The group experienced lack of projects and

ideas and innovations are limited. Work processes within the organization are very

mechanical and traditional, curbing the contribution of mental growth in knowledge

management.





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6 .0 Analysis

6 .1 SWOT Analysis

6.1.1 Strength

ECB¶s prospects plans are focusing more on market share and on higher end

property development activities to encourage and generate attractive yields and

returns. From developing residential and commercial properties ranging from low

to high price, ECB now shifts its marketing strategy towards focusing on the

higher-income target, whereby its end products will be set at a higher price in the

market, promising quality as its differentiation strategy. ECB are building

townships with a sense of passion and inspiration. The unique concept of their

properties speaks the indulgence of lifestyle amenities for a work-life balance.

The Group acknowledges that continuous education is vital for the Board members

to keep abreast with, or gain insight into, the state of economy, technological

advances, regulatory updates and management strategies. All the Directors have

attended the Mandatory Accreditation Programme (MAP). During the financialyear ended 31 March 2009, the Company had organized an in-house training

programmed on ³Mind Mapping for Quick Action´ for Directors and

Management. Subsequent to 31 March 2009, the Directors and Management also

attended another in-house training programme on ³Fish! Philosophy´ on 27 May

2009. The Board will continue to evaluate and determine the training needed by

the Directors from time to time to enhance their skills and knowledge, where

relevant and to keep abreast with the new regulatory development and listing

requirements of Bursa Securities





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6.1.2 Weakness

As we were told by the ECB Human Resouce Manager, Miss Wong Siau Ying, the

board of director¶s role in ECB is to reviewing and adopting the design systems

and/or programs that implement the strategic plan. Employee is only being

informed by the executives to perform the strategic plan. In ECB, there is only a

one-way linkage of strategic planning and human resource management. ECB is

not integrating each of department together with the strategic planning committee.

The human resource department is only merely putting it at merely a filial

responsibility of the finance department.

The development activities during the financial year had been centred on

completing the Group¶s existing projects in Seri Kembangan location as the

construction progress of the majority of these projects had fell behind schedule.

Some of these projects were incurring compensation for late delivery and hence,

draws the urgency to complete these projects as soon as possible to stem losses,

besides fulfilling the Group¶s obligations as a property developer. Another

weakness is due to poor sales, the Group has decided to suspend the construction

of Permai Central which was launched in the preceding financial year, FY2008.

Permai Central was intended to be a commercial centre with a transportation hub

in the Group¶s Pusat Bandar Putra Permai township development which features

mixed development of retail outlets, shop offices and office space fronting a

transport hub.





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6.1.3 Opportunity

The Group acknowledges that the availability of suitable and sizeable land banks

is vital to the continued future of property development activities of the Group.

One of these efforts resulted in the purchase of a parcel of land measuring 16

acres in Taman Equine, Seri Kembangan for a total consideration of RM47.4

million, which although is small in area, provides a strategic component in the

commercial development of that area. Conscious of the necessity of having a

sizeable land bank, the Group will continue to identify and evaluate suitable and

strategic land for opportunities to increase the land bank of the Group.

While the present economic situation is not encouraging, the Group took the

opportunity to rationalize its businesses. Such of their planning are to dispose of

non-core assets to streamline the Group¶s operations as well as enhancing cash

flows, dispose of parcels of land which either contributes strategic catalytic

impact to spur future development of existing land bank or those land with low

development value or low returns, reduction of Group¶s borrowings to reduce

financing costs with overall impact of improving Group¶s profitability, increasing

existing land bank for business continuity, strategies timing of new project

launches and ensure good returns, and commit to completing projects on time.

With the foregoing considerations, the Group is planning to launch a few

projects in the next financial year. In Seri Kembangan, plans have been drawn up

for new launches of 408 units of semi-detached houses with a total GDV of

approximately RM260.0 million while the Mestika Jaya project in Cheras will

see an additional 22 units of shop offices with estimated GDV of RM8.0m. The

Group¶s project at Crescentia Park in Batu Kawan will find itself elevating to

higher class housing development from its present low cost housing with the

target launches of a total of 259 units of two storey terrace houses and 172 units

of semi-detached houses with a combined GDV of RM150.0 million.





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Besides these new project launches, the Group will also be progressing works

towards delivery of 10.05 acres land which was sold in early 2009. These new

project launches, together with the land development works, will be the

forefronts to progress further development activities to bring better returns to the

Group in the near future.

6.1.4 T hreat

The uncertainty of development in the economic situation will affect the

developments of ECB and have culminated in reports of negative growth in the

economy in the first quarter of 2009, signaling the possibility of an economic

recession. Business activities in the local economy during this period were

marred by surging fuel prices, runaway inflationary pressure on material prices,

employment losses and contracting customer spending. Because of these factors,

ECB¶s sales are declining this year.





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6 . 2 PEST Analysis

A PEST analysis is an analysis of the external macro-environment that affects all firms.

P.E.S.T. is an acronym for the Political, Economic, Social, and Technological factors of

the external macro environment. Such external factors usually are beyond the firm's

control and sometimes present themselves as threats. For this reason, some say that

"PEST" is an appropriate term for these factors. However, changes in the external

environment also create new opportunities and the letters sometimes are rearranged to

construct the more optimistic term of STEP analysis. Many macro-environmental factors

are country-specific and a PEST analysis will need to be performed for all countries of

interest. The following are some of the factors that might be implemented by Equine

Capital Berhad. This stands for the four areas that represent the most common external

influences. These are:

y P olitical factors ± for example, new laws and regulations or decisions made by

Governments y E conomic factors ± changes in the economy, people¶s spending power, patterns of

wealth

y S ocial factors ± changes and trends in society, for example, the number of people

aged over 60 in society

y T echnological factors ± changes in techniques or equipment that can lead to the

development of new goods and services or new ways of doing things.

Table 5 : PEST Model







2 0

Foreign workers have contributed to the rapid growth of the economy. In the

manufacturing sector, foreign workers not only helped to alleviate the problem of

labour scarcity but also kept labour costs relatively low. This enabled producers to

maintain their competitiveness against other low-cost producing countries.

In times of recession, they also served as a buffer and helped to maintain a

relatively low level of unemployment. Foreign workers also contributed to

increasing domestic demand through their expenditure on food, transport and

other consumption items.

6.2.3 Social

ECB believes that their clients will be seeing some encouraging results from their

early purchases in well selected developments in Malaysia and they are pleased to

offer Malaysian some expertly vetted developments. With the Malaysian ringgit

valued so cheap against the sterling and the euro, investment in Malaysia is

currently even more tempting to overseas purchasers.

In fact purchasing a property in Malaysian has never been more viable: in

addition to its ³Ninth Plan´ encouraging further economic and social

improvements to the country, government legislation is actively inviting property

investment from foreigners through tax incentives and the relaxation of laws

purchasing property in Malaysia. Malaysia is a popular destination by virtue of its

stunning natural beauty, warm climate, interesting culture and well mannered

people.





2 1

6.2.4 T echnological

The employment of workers has exerted several adverse effects on the economy.

Workers have slowed down the growth in productivity, displaced foreign workers

in some industries, depressed wages, released the pressure for upgrading of skill

and technology, thus impeding human capital development, and delayed

economic transformation. An intensive awareness campaign should be conducted

among producers on the benefits of technological upgrading and moving up the

value chain, and the non-sustainability of their labour-intensive production.

Financial incentives should also be provided, whenever necessary, to encouragevarious industries to help them shift to labour-saving activities.

To illustrate, adopters of Industrialised Building System could be given large-

scale public projects to make the venture cost-effective. Similarly, manufacturers

of prefabricated components in the construction industry would need incentives

because of the heavy capital investments involved. In summary, few would argue

on the importance of setting up a transparent and efficient system to manage the

flow of local workers. This system requires a complete database to monitor the

activities of workers as well as to determine the wages towards on them.

Like all other business entities, changes in political, economic and regulatory conditions

could materially and adversely affect the financial and business prospects of the ECB.

Amongst the political, economic and regulatory uncertainties are the changes in political

leadership, expropriation, nationalization, renegotiation or nullification of existing sales

orders and contracts, interest rates, method of taxation and currency exchange rates. Any

adverse changes in such political, economic or regulatory conditions could have an

adverse effect on ECB¶s business, financial condition, results of operations and prospects.

The primary inherent risk of the ECB and this industry is the exposure to economic cycles.

The other risks include changes in political and business conditions, labour, land, and





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building materials shortages, increases in cost of labour, interest rates and availability of

bank loans, land and building materials and changes in legal and environmental

framework within which the industry operates. These risks are addressed as part of

ordinary course of business.

According to Miss Wong Siau Ying, ³Our efforts to move towards a high-income

economy, concentrating on high value-added, technology-intensive and knowledge-based

economic activities would be hampered if we continue to rely on low-skilled foreign

labour.´







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Now that the corporation had shifted its strategy to differentiation in producing high-

cost properties, the HRM Department must realize that changes should be done. If

before, cost strategy was also take into account in producing low-cost properties and

that the organization was control-oriented, high centralization, requires low

participation of its employees, low training, low wages, low benefits, and highly

contingent pay, it cannot stick to that ways anymore. In order to go towards the

direction of differentiation, it needs to be more committed towards its employees in

order to promote higher productivity and lower employee turnover.

Besides that, ECB needs to change its laid back style of being simply reactive to bemore proactive. It should not only reacts to its environment in every occasion of

underperformance, but be more competitive. Instead of reacting to become more

focused towards a smaller target market of higher income customers now that it is

experiencing low sales, it should have avoid this and bounce beyond performance.

Instead of going ahead with concentration strategy from the start until now, it should

start expanding its market through external growth strategy in order to be more

proactive.

It should increase its effort of collaboration of joint alliances with other parties in

order to increase its market shares. With that, there should be more training and

development effort and constantly looking for the best and proactive employees

rather than sticking to traditional ways of mechanistic approach. ECB needs to

embrace new ideas of innovations. It should know clearly of what kind of employees

that it wants to be part of it, rather than blindly selecting based on limited criteria and

eventually having its employees ³come and go´.





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7 . 3 Forecasting: Aware of Ways to Support Strategic Plan

Besides that, the limited knowledge management function within HRM in ECB shall

also be taken into account. The information system that it is using is the payroll

system and it is not even integrated to other departments. Integrating this system with

other departments of the organization shall make the information managed by HRM

be more transparent and this actually could decrease and avoid trivial or redundancy

of work. Employees could have checked for this transparent information themselves

without taking the time of the HRM Department. It could lessen the unnecessary

work burden of the HRM staffs.

Instead of using traditional time-consuming paperwork filing, the HRM Department

should manage its employees¶ movement within the organization in a more

systematic way. They should start adapting the transitional matrices in order to

determine the demand and supply of its internal human resource. They should stop

using the way of filling vacancies by informal type of communication process with

various department heads informing them of the vacancies. This is also very

traditional and very last-minute that much works are unattended to that their projects

delivery are delayed because of the redtape problem that is worsen by the unattended

work.





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7 . 4 Recruitment & Training & Development Process: Develop

Appropriate Guideline and Programs

Instead of vaguely selecting applicants in recruitment process without any systematic

guideline and keeping on hiring and hiring again after employees ³come and go´, the

HRM Department of ECB should start finding out the problem why its employees are

not committed to the organization and based on that start to react and change any

necessary ways appropriately. First of all, the HRM Department should recognize that

employees are not merely human resources but they need to recognize the unique

individuality of each staffs and improve on their relationship with their staffs.

Training and development should stop being outsourced and start to carry out

internally based on appropriate guidelines and programs. This is because only the

organization itself knows best of what it wants exactly in its human resource; what

kind of mentality and culture do they have, etc.





8 .0 Conclusion

It is crucial for ECB to increase its commitment towards its employees because of the shift of

its strategy. ECB needs to recognize the potential of its human resource in effectively plans

its tactics in countering threats and in grabbing opportunities. ECB have no choice but to go

ahead for differentiation strategy since cost strategy is inapplicable in its geographic scope of

business, whereby Seri Kembangan and Batu Kawan are both areas that are quite far from the

urban cities.

Even if ECB decides to undertake cost strategy, it needs to be done without targeting on thehigh-end property (for now) since ECB is currently facing unprofitability. It is not possible

for ECB to go for differentiation high-end target in its business and practices contradictive

low cost human resource management style at the same time. Employees will remain

uncommitted and ³come and go´, unless ECB becomes more proactive in embracing

strategic human resource management.

The limitation in implementing this is that despite much evidence suggesting the significance

of HRM function in achieving competitive advantage, many organizations are not actually

implementing it, partially could be attributed to the difficulty of measuring financial impact

of these practices. Further study in valuing HRM monetarily may change the perspective of

many businesses management that does not recognize the significance of strategic planning

through human resource management in Malaysia, such as ECB.

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