COMPANY HISTORY
KTS Holding Sdn Bhd (KTSH) is an investments holdings company that was established in 1962. The KTSH primarily consists of non-public listed companies. Its main activities encompass timber logging, timber processing (such as plywood and sawn-timber), reforestation, plantation (specifically oil palm) and estate development, newspaper publishing and printing, property holding and construction, general and imported goods trading, insurance agencies, shipping, food processing, and hotel and restaurant operations.
The KTSH has around 10,000 employees spread out across Borneo to meet the company’s needs. The headquarter of the KTSH is situated at Crown Tower (Jln Pending), which is owned by the company. The Human Resource Department of the KTSH is located on the 6th floor and has a staff of 30.
The Human Resource Department (HRD) serves multiple functions in supporting management. HRD acts as a planner, responsible for tasks like planning staffing needs, recruitment, and employee selection. Additionally, HRD acts as a facilitator by organizing training and career development opportunities, as well as conducting orientation sessions for new employees. Furthermore, HRD coordinates matters related to employee health and safety, amenities, and benefits as a coordinator.
As the company’s auditor, HRM is responsible for overseeing employee performance and controlling compensation offers, including rewards and benefits. They also assess accident and injury reports. Additionally, HRM’s management division acts as a mediator in employee disciplinary matters, consults with worker’s union, handles conflicts, and addresses employee dissatisfaction.
Furthermore, HRD plays a crucial role in aiding KTSH in achieving its organizational goals by effectively utilizing the skills and abilities of the workforce. They also ensure that the organization has trained and motivated employees which ultimately results in enhanced job satisfaction.
The HRD is in charge of supervising the development and upkeep of the working environment, as well as implementing policies. They also have the responsibility of managing social responsibility and ensuring ethical behavior.
FUNCTION OF HUMAN RESOURCE DEPARTMENT
The department of human resource management in KTSH, a large organization, is responsible for overseeing the execution of tasks and responsibilities related to the provision and coordination of human resources. This department is accountable for all functions pertaining to human resources.
KTSH has specialized professionals who handle human resource functions, focusing on various areas. These functions go beyond basic record maintenance and updates and instead adopt a comprehensive and integrated approach to improve the overall effectiveness of the organization. The Human Resource Department at KTSH oversees staffing, development, safety, and health aspects. Next, we will delve into each of these functions:
Staffing KTSH’s HRD involves various processes including human resource planning, job analysis, recruitment, and selection of manpower. In human resource planning, HRD is responsible for forecasting the requirements of KTSH to achieve its objectives, as well as developing and implementing activities to meet the organization’s needs. This planning is crucial to ensure that KTSH has an adequate workforce with suitable employees in the right time and place, avoiding any surplus or shortage of manpower. Ultimately, efficient employee performance is ensured through this planning process.
KTSH’s HRD ensures that the distribution of staff is always adequate to prevent any departments from experiencing a surplus or being overloaded. They regularly review and confirm the overview of all sub-companies, allowing them to stay updated on the job distribution within the lower management.
Job Analysis and Design
The HRD at KTSH conducts job analysis to determine the specific requirements for each position within the company. This involves collecting information about the responsibilities and duties of a particular job. The data gathered from the job analysis is then used to create jobs, develop job descriptions, and establish job specifications. To carry out this process, the HRD follows a systematic approach that begins with identifying the selected job and obtaining data from either the employee or supervisor. Various methods, including face-to-face interviews, surveys, observations, journals, and reports are employed to gather necessary data.
The process begins with identifying the necessary job data, such as duties, responsibilities, and skill requirements. This collected information is then used to create job descriptions that outline the duties and obligations of the job. Job specifications can also be obtained during this process, categorizing the required skills, physical attributes, knowledge requirements, and capabilities for each job. Once this analysis is complete, HRD can proceed with recruitment, selection, training & development, performance evaluation, and management.
Using the information gathered from the job analysis, the HRD can go on to design the job based on department needs and employee characteristics, qualifications, and capabilities. Job design is also utilized to create a suitable timetable and workflow for each department, ultimately enhancing employee contribution.
HRD Recruitment in KTSH is responsible for the identification and encouragement of potential candidates to apply for available positions. Detailed task descriptions and job specifications define candidate eligibility and requirements. Both internal and external recruitment drives are carried out by KTSH. Internal recruitment aims to enhance the company by allowing current employees to apply for open positions. Suitable internal candidates can be identified through the human resource information system, job postings, and bidding. Existing employees have the opportunity to improve themselves but must obtain approval from their immediate supervisor before applying.
In order to take part in the recruitment process, employees need to submit a recommendation letter from their immediate supervisor. KTSH acknowledges that hiring existing employees internally can reduce costs associated with orientation and training since these individuals are already acquainted with the work environment. Furthermore, internal promotions can serve as a form of recognition for exceptional performance, enhancing morale and motivation.
The HRD department values the performance records of employees offered new jobs over those of external hires. However, if current employees cannot meet requirements for higher-ranking positions, external recruitment is preferred. This involves advertising in newspapers to attract potential candidates and considering recommendations from existing staff members.
The company provides incentives for employees who find suitable candidates, granting them bonuses for each successful hire. Moreover, the company annually selects individuals from public and private Higher Learning Institutions. Some candidates are chosen from colleges or universities and receive scholarships until they finish their education. Once they graduate, these candidates will be employed by the company on a contractual basis for at least 2 years. Despite having received formal training, these young candidates may have limited experience.
Selection in HRD involves using a selection method to find the best candidate for a vacant position. This involves choosing a candidate from a group of applicants obtained through the recruitment process. HRD typically follows a selection procedure that includes reviewing application forms and resumes, checking the candidate’s background, conducting interviews, and administering selective tests such as on-the-job skill and personality assessments.
The HRD will begin by organizing the candidate list to make the obtained information simpler. They will initially determine the tasks and responsibilities that each candidate can and will perform in their job. Factors considered for what candidates can do include their knowledge, skills, and their capacity to acquire new knowledge and skills. Factors considered for what candidates will do include their motivation, interest, and other personality traits. The HRD of KTSH holds the belief that an employee who has the ability to do something but lacks willingness is more valuable than an employee who is interested but lacks ability.
Measuring an applicant’s capabilities is easier than predicting their future actions. Test scores are used to assess a candidate’s abilities, while interviewing provides insight into potential future performance. The decision-making process for hiring personnel in HRD varies depending on the job category. HRD utilizes different approaches, namely the clinical approach and statistical approach, to determine whether to hire an individual for a specific position.
Personnel involved in the selection process will thoroughly examine all candidate data using a clinical approach. The decision will be based on the interviewer’s understanding of the specific job and their observation of successful individuals in that role. Although subjective, this clinical approach is commonly employed by many organizations. In contrast, the statistical approach is more objective and preferred over the clinical one. The candidate data will undergo meticulous analysis, and a statistical forecaster will be appointed.
After the initial screening, successful candidates will be referred to departments with open positions. The manager or supervisor in each department will conduct an interview to assess their suitability for the role. If selected, the HRD section will communicate the outcome of their application and provide them with job details.
Human Resource Development
HRD undergoes the human resource development process to produce informed, skilled employees who understand both personal and organizational goals. The purpose of human resource development is to help employees contribute positively through satisfactory work performance. Activities include conducting orientations for new employees, identifying, designing, and implementing training programs to enhance skills and abilities. The ultimate goal is to foster a culture that values and rewards continuous learning.
At KTSH, the HRD conducts training for new staff upon their arrival. For current staff, training is held on a monthly basis if needed for lower management, and quarterly for higher management. Performance evaluation is done after training to assess the effectiveness of the program. Human resource development also emphasizes career growth within the organization, providing necessary skills for employees’ current roles and assisting in the creation of individual career plans.
Compensation and Benefits
Compensation and benefits, which include both monetary and non-monetary incentives, are crucial elements of human resource management. These incentives are provided to employees based on their employment status. The responsibility for establishing a comprehensive compensation and benefits system that applies to all staff members lies with HRD. It is also essential for HRD to maintain fairness and consistency in this system. At KTSH, we provide both individual and group incentive plans.
The individual incentive plan includes work units that are classified as either fixed rate or different rate incentives. Currently, the HRD department uses the fixed rate work unit system, in which employees receive a predetermined rate for each unit they produce within a specific timeframe along with their basic salary. The standard hour plan determines the incentive pay rate based on the organization’s set standard time to finish a task, regardless of the actual time taken by the employee.
Irrespective of whether the employee finishes the task quicker than the standard time or not, they will receive an incentive payment according to the standard time. Moreover, employees qualify for a bonus at year-end, which is determined by both their sector’s profit and the company’s overall profit. This bonus acts as an extra payment incentive in addition to their basic salary and is given based on enhanced performance quality and sector profits.
Under the group incentive plan, the Team Incentive Plan rewards each team member with a bonus payment when the teams meet the performance standards. Because different types of teams can be formed, such as cross-functional teams and process improvement teams, it is challenging to establish a single payment method or calculation formula for team incentives. The company establishes criteria for evaluating team performance, which may include increases in production, capabilities, and quality or decreases in material and labor costs. The HRD department also sets a maximum limit for the total incentive amount that can be provided.
For instance, the total incentive cannot go beyond 10% of the basic salary. KTSH’s employee benefits program is founded on a particular objective. The objective established by a company depends on various factors including the firm’s size, location, and the level of worker union participation. Nevertheless, the specific objective of the benefit program must align with the organization’s strategic plan for compensation management. The primary goals of a benefit program are to enhance employee contentment, meet employees’ safety and health requirements, attract and incentivize employees, and maintain the competitiveness of the organization.
KTSH offers a range of benefits to its employees, categorized as mandated and non-mandated benefits. Mandated benefits are determined by labor laws and ensure the minimum rights for employees, provided by KTSH. These mandated benefits include payment for time off, maternity leave protection, contributions to the Employee Provident Fund (EPF), and participation in the Social Safety Scheme (SOCSO). On the other hand, non-mandated benefits are voluntarily offered by KTSH without any obligation. These non-mandated benefits encompass insurance schemes and healthcare coverage.
Safety and Health
The main objective of the human resource management team is to create a work environment that effectively protects against safety and health hazards. In this context, a “hazard” refers to any situation that could potentially harm an employee and limit their ability to work. The HRD is responsible for developing and implementing initiatives focused on ensuring employee well-being.
HRD at KTSH is highly concerned about the health of their employees. They demonstrate this concern by organizing various programs like exercise, healthy diet campaigns, and sports tournaments such as football, netball, and badminton. Additionally, they actively monitor weight problems and discourage activities that are detrimental to health. In order to promote a healthy lifestyle, these organizations provide facilities like gymnasiums and aerobic classes. Furthermore, HRD frequently arranges health care seminars and health assessment sessions for employees at high risk. In fact, they have even allocated a budget to construct a gym on the 10th floor of Crown Tower for employees at their headquarters.
The gym at our facility offers a variety of amenities such as a badminton court, squash court, sauna room, and table tennis room. We encourage our employees to make full use of the gym that is provided by the management. Additionally, in order to maintain a healthy environment for our employees, smoking is strictly prohibited in the workplace. Employees who are over the age of 40 are required to undergo a comprehensive medical check-up every 2 years to ensure that they are in good physical condition. Each department also forms small units responsible for adhering to the Operational Safety and Health Act 1994.
This small unit pays attention to the risk of office hazards and it is important to report any incidents found by the unit to the HRD. The HRD will provide training and updates on OSHA on a quarterly basis or as needed. KTSH is an investments holdings company that has sub-companies responsible for timber logging, timber processing (such as plywood and sawn-timber), reforestation, plantation (specifically oil palm) and estate development, newspaper publishing and printing, property holding and construction, general and imported goods trading, insurance agencies, shipping, food processing, as well as hotel and restaurant operations.
Despite its large size, KTSH recognizes the importance of hiring new staff. The key focus is finding the right person for the right role, making staffing a critical function of the HRD. Additionally, Human Resource Development is the second major function of the HRD, as the company primarily deals with technical and engineering knowledge. Practical skills are crucial for operating effectively. Thus, employees at all levels require sufficient skill and knowledge. Lastly, compensation and benefits management is another important HRD function.
With over 10,000 employees, it is crucial to ensure that the benefits and rewards provided to the employees are well taken care of in order to enhance their performance. Although Safety and Health may be considered the least important function in HRD, it is still a concern for the company. The company prioritizes the health of its employees, ensuring that potential candidates pass health-related interviews before being hired. Consequently, once employed, safety and health issues are given equal importance as other functions within the company.
CHALLENGES AND ISSUES FACED
KTSH is an investment holdings company with a workforce of over 10,000 employees. The primary challenge faced by the HR department (HRD) is the management and supervision of these employees. Specifically, with only 30 staff members in the HR department, each individual is responsible for overseeing an average of 333 employees throughout the company. As employees are spread across various locations based on the requirements and operations of different subsidiaries, the HRD finds it challenging to provide personalized attention to each employee. Consequently, it is impossible for the HRD to meet all individual employee needs and monitor each employee effectively.
With over 10,000 employees across different sectors, it is a challenge for the HRD to ensure that each employee is adequately trained to carry out their assigned tasks. This is particularly true for employees in the timber field, who may lack the necessary knowledge for their job.
Most of the workers in the forest are uneducated, including foreigners from countries like Indonesia and Bangladesh. These workers may lack knowledge about safety and health. However, reaching out to them is challenging for the HRD. The HRD primarily provides training to higher management and not to the workers, as their lack of education may make it difficult for them to understand theoretical concepts. The HRD faces the challenge of ensuring that all staff members have the knowledge required for their assigned tasks.
Counseling is a significant challenge for the HRD as it fulfills the HR department’s responsibility of effectively addressing employee concerns. In a large organization, conflicts and complaints can arise, posing a risk to the company’s operations. Therefore, prioritizing counseling for various employee issues, including medical, workplace, knowledge, and skill-related problems, is essential to prevent any delay or neglect in the company’s functioning.
Hence, the HRD faces the issue of finding the appropriate solution to solve the problem. Case #4 also involves the challenge of placing the right person in the right position. Another difficult task for the HRD is recruiting the suitable staff for a particular job. During interviews or sometimes just through resumes, the HRD only obtains limited information about a person. As a result, some staff members may be assigned to a job that is not suitable for them, while they may excel in another position.
SOLUTIONS AND DECISIONS
HRD implements a series of measures to manage the large workforce of KTSH. These measures include assigning a supervisor to a maximum of 5 subordinates, limiting managers to no more than 10 supervisors, mandating that every manager report to their department head, and ensuring every department head reports to the HRD. Although this process may be lengthy, it allows HRD to effectively oversee the 10,000 employees at KTSH. Additionally, HRD occasionally sends teams to inspect the sub-companies and holds town-hall sessions with them.
Every employee will have the opportunity to express their concerns through a questionnaire distributed once a year. This occurs typically towards the end of the calendar year, allowing employees to rate the company and provide suggestions.
When hiring a capable employee, the HRD must thoroughly select and classify qualified personnel during the recruitment process. Candidates must meet minimum education requirements to be considered for employment.
The job application for a specific vacancy may require candidates to have a minimum number of years of experience in the relevant field. The immediate supervisor in that sector should possess sufficient knowledge to guide their subordinates. Supervisors receive quarterly training to stay up-to-date on the latest cases and methods. Existing staff members also receive training annually or as needed based on the requirements of their respective sectors. These trainings may not always be limited to theoretical classroom sessions, but may also include practical training outside the classroom.
One possible solution to address these issues is to organize multiple meetings for employees and staff, while also promoting the concept of conferences within the firms. Additionally, it is crucial to educate and provide guidance to new employees, enabling them to gain a better understanding of the business environment and align with the ethics of the organization. Managers and supervisors play a crucial role in educating these employees.
The SPI, collective agreement, and disciplinary actions booklet have been distributed to all staff members on their joining day. The organization conducts teamwork outings, seminars, and company trips to foster bonding among employees. This initiative aims to reduce conflicts and enhance employee relationships.
During the probation period, which lasts for 6 months, newly recruited staff members receive training, guidance, and learn their job assignments. At the end of this period, the supervisor or manager of their sector evaluates their performance. If the recruit passes the assessment, they will become a staff member of the company. However, if they fail, their probation period will be extended by one month. If the recruit fails for a second time, the company will reject their joining.
Supervisors and managers receive constant reminders from the HRD to focus more on their subordinates. Performance evaluation is conducted annually to assess employee performance. The HRD welcomes suggestions and comments to enhance employee development. Additionally, internal recruitment opportunities are provided by the HRD, allowing existing staff to choose a work environment that best utilizes their talents.
REFERENCES
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- Wikinvest. Wikinvest Human Resource [Online]. Available: http://www. wikinvestans. com /human_resource_dept/
- Anna, HJ (2003). Human Resource Issues and Challenges. [Online]. Available: http://share. hrdept. corp/assignment/spring_2003
