Indonesian businesses have experienced robust growth in the past five years. Contrary to her ASEAN counterparts, Indonesia’s economy grew at a higher-than-expected rate of 5.18 percent year-on-year in the second quarter of 2016. But with tightening of economic policies and the slowing global market, this is not expected to last. Starting now, Indonesian businesses must rethink the way they operate and the behaviours they cultivate in their employees in order to establish a future-ready, high performance culture.
According to the Aon Best Employers 2016 study of 30,000 employees across Indonesia, a consistent practice among Best Employer organisations with high performance cultures is to create an empowering environment for their people. In fact, Aon Best Employers in Indonesia last year recorded 29 percent lower attrition and 37 percent higher profit than the market average—demonstrating that a high performance culture creates the greatest competitive advantage.
The question is: How?
Culture refers to an organisation’s operating environment (or how work gets done), which is made up of three parts—beliefs, or what’s important to business; behaviours, or how people behave and interact; and decisions, or how choices are made. Aon’s research shows that companies with higher culture alignment have better business performance, lower turnover rates, and higher levels of Net Promoters—which refers to the percentage of employees who will recommend the organisation to someone seeking employment versus employees who won’t.
To develop a high performance culture, an organisation’s leaders must be committed to recognising, rewarding, and reinforcing the right behaviours from their people. Managers have a significant role to play in making this happen, and their behaviours are the ones to set the bar.
1. Make career development a priority
86 percent of Aon Best Employers in Indonesia have processes in place that enable employees to acquire new skills and competencies (market average, 61 percent). This includes paying for training programmes, mapping career paths to target next-level promotions, and providing opportunities for greater visibility to both internal and external stakeholders. Promotion-linked goals are integrated into performance management, so as to motivate employees to constantly enhance their capabilities. Mentoring programmes also offer high potential employees opportunities to grow within the organisation, while providing a strong leadership pipeline for the future.
2. Recognise employee contributions beyond pay and benefits
74 percent of Aon Best Employers in Indonesia have robust employee recognition and rewards systems to ensure that excellent work is acknowledged in specific and timely ways (market average, 56 percent). This helps to promote behaviours that employers want their employees to repeat—regardless the level or function—motivates employees to perform. In fact, 77 percent of Indonesia’s Aon Best Employers say their senior leadership treats them as the organisation’s most valued asset (market average, 61 percent).
3. Develop effective managers
All Aon Best Employers in Indonesia coach their managers on how to offer career advice to their team members (market average, 76 percent); while 80 percent train their managers to hold effective career conversations (market average, 47 percent). This high-impact approach enables managers to improve engagement within their teams—and encouraging improved performance—while creating an environment where all employees feel empowered over their own careers. When employees are clear about the direction of the organisation, and more importantly, where they fit in, they are more likely to perform at a higher level.
4. Managers are accountable for engagement
Studies show that 3 in 4 employees leave as a result of ineffective managers. Yet, an organisation’s leaders have a responsibility to equip their managers with the appropriate skill sets to create high performing teams. All Aon Best Employers in Indonesia provide feedback to their managers on how their leadership styles influence the team (market average, 82 percent). Managers are also assessed and rewarded based on their people management quality, which encourages them to draw out high performance culture behaviours from their people.
In Indonesia and across ASEAN, successful organisations view high performance culture as an essential quality to remain competitive and keep pace with an evolving business landscape. By setting high performance culture as the desired outcome of their people strategy, the most forward-thinking of Indonesian employers are now well positioned to develop a workforce that is ready for the future.
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