Stand by your men

SIMON MATTHEWS

By Somporn Thapanachai

Despite the gloomy outlook in the workforce market next year with both public and private organisations projecting unemployment of up to onemillion, the internationalemployment services firm Manpower (Thailand) Co Ltd is confident that its business in Thailand would be able to weather the perfect storm and find opportunities amid the crisis.

SimonMatthews,Manpower’s country manager, believes that the company will be able to achieve13% profit growth next year without additional workforce but through the increasing of productivity among existing staff and branches.

‘‘We need to monitor the situation on a weekly basis, making sure thatwe change to [adapt to] what is happening out there. I’ve never seen the market change as quickly as has been happening at the momentin our industry.

‘‘One client earlier wanted to expand butnowit’s looking at contraction. That was just a month ago,’’ said the 50-yearold British chartered engineerwhoestablished Manpower’s office in Thailand in March 1998 and has expanded the business to the current position with approximatelytwo billion baht of revenue this year, up 18%from 1.7 billion baht in 2007.

Manpower each year fills both contractedandpermanentpositions for about 500 clients in Thailand. It has about 6,500 contracted workers and fills over 500 permanent positions this year. Its business is supported by 230 permanent staff in 10 locations.

The company was physically set up after the 1997 regional financial crisis triggered by a meltdown in Thailand so it has not yet experienced a similar economicnightmare. YetMrMatthewsrealises that the challenges for Thailand are greater than they were a decade ago.

At that time, the weaker baht against other currencies was a positive factor attracting foreign tourists to visit the country but this time Thailand is already expensive from the currency-exchange point of view. Thailand has also suffered for the past three years from a prolonged internal political turmoil, whichculminated in the closure of the country’s gateways Suvarnabhumi andDonMueangairports in early December.

However, he hopes that Thai people would help support domestic tourism whenoperators in the hospitality industry offer a good discount package.

Though the hospitality industry, automobiles, electronics, real estate or other real sectors would be hit by the economic crunch, Mr Matthews views that some sectors might survive the crisis relatively unscathed such as pharmaceutical, food or consumer goods.

‘‘Westill see opportunities this time. You [can] look for opportunities as not all areas are affected,’’ he said. ‘‘Whatyoufind generally in recruitment in a recession [is that] permanent recruitment is often affected more because of companies’ nervousness to hire headcount. Butwehave our contracted business as well.’’

He said that sometimes companies did not want to have permanent headcount so they used contracted staff. The scenario is different in manufacturing industries, as they would cut outsourced labour before permanent positions.

‘‘Vice versa, when the economy picks up, the industries also want to hire contracted labour andoutsourced staff before adding to their permanent headcount,’’ said Mr Matthews,whofirst settled in Thailand in 1992, working with SGS Thailand. He is also chairman of the HRcommittee for the Thai-British Chamber of Commerce, as well asmember of the Thai Business Leaders Forum.

With theeconomystuck in a downturn, Manpower expects fewer orders but too many candidates available, a completely different situation from what it experienced not so long ago, when companies could not find enough qualified candidates. ‘‘So whatever the market, an economic boomor a recession,wehave our challenges, only different ones,’’ he said.

Therefore, in a time of crisis, Mr Matthews suggested that companiesmanage their staff using a flexibility approach both in workforce management and reward system.

‘‘Look at the productivity of people, a goodsystem for monitoring performance andhandling either development of nonperformance or develop out if they can’t perform. Reward people through good reward packages so high performers are well-rewarded.

‘‘In a crisis, you need to have a motivated workforce that is rewarded for developing growth, profit or production.’’ The overall market for all industries in Thailand will not be very active so it is necessary for companies to gain market share by getting out to customers and increasing activities with them, looking into areas ofnew services or sectors that they have not tapped before, andcreating innovative solutions for customers.

‘‘Make sure that you’re monitoring the situation. Things happen quickly so you have to be on top and know what is happening in your market. What will people buy from you? What are your competitors doing? Then you need to be very fast and responsive to change.’’ The bottom line for business management is financial status so Mr Matthews strongly recommends that companies really manage expenses by looking at the ratio between profit growth, revenue and expense slices.

Meanwhile, he suggested that companies should be careful not to change directions and strategies or downsize too muchas theymay not be in the position to ride the growth when the economy picks up.

Headquartered in the US state of Wisconsin, the US$21-billion Manpower is a world leader in the employment services industry with 4,500 offices in 80 countries and territories that serve its 400,000 clients per year.

‘‘Myrole as head of the country operation is to work withmydirectors and managers, try to motivate and support themin developing clients andinnovation solutions, making sure thatwe’re in a position to actually capture the opportunity with the economy picks up,’’ Mr Matthews explained.

‘‘Manpowerglobally has been in business for 60 years and has been through situations when the economy comes up and down. Each time, Manpower comes out stronger and better. And it will do so this time.’’

Healso believes that the current global financial crisis will lead governments and financial institutions to review their regulations and business practices to prevent problems in the future.