After seeing a series of blogs from esteemed bloggers like Jerry156, Erin, hkguy and wilson, I thought I would break my Ahmoi silence. This topic reminds me of a piece of research I did for a client a few months back.

It was exactly as described by many of these blogs - the management of the (foreign) company was wondering why their staff was underperforming here and the foreign manager was at his wit's end because it was his KPI to establish and run a successful office in Malaysia and things were not working out.

In essence, the staff were not engaged in their work, they were spending more time on their "side business" than their full time job, they were taking a lot more leave than they should have.

Having gone through the employees' handbook, seen first hand at how management was running things, I became convinced that the problem was not management. The employees were not really the problem either, they were mostly your average Malaysian worker and didn't stand out in any bad, or great, way.

I ended up doing an international survey and that was when the results got really interesting.

After talking to company management in several countries and running through the statistics I'd collected, there were some very clear trends. It turns out that this was more or less an international issue and the most common complaints were "Pay is not enough" on the employee's side and "People nowadays are undisciplined." on the employer's side. This was true no matter which country it is.

What was different, though, was the degree to which this was a problem. My first thought was this was a pay issue - but that did not explain why the problem was noticed quite a lot in Singapore (nominally a high income country) as well as Malaysia (middle income) and even somewhat in the UK (high income). It wasn't noticed in Switzerland, Norway or the Netherlands.

Ultimately, a management research paper highlighted what might have been the true problem here. It was an issue of societal trust.

Societal trust implies the degree of trust that people have in the society in which they live. In countries with a high degree of trust, e.g. Switzerland and Norway, employer-employee relations went pretty well because most workers felt that the system was fair on the whole. In countries with low trust, e.g. Malaysia and Mexico especially, this was the opposite. You know the story, "Aiyah, work so hard for what. It's not what you know, it's who you know."

A lack of trust breaks down the normally implicit relationship between employer and employee and many of the employees in these parts of the world view their employer as someone who "helps them pay the bills" and therefore should be viewed only in that light. It didn't help also that management started to view their employees as untrustable and instituted rules-based, carrot-and-stick policies to motivate / punish their staff.

The second interesting point was looking at examples where things worked the opposite from expected, i.e. companies in Malaysia where the employees were really motivated. In most of these cases, money was a poor motivating factor. It seems that what really got employees going was a more transformational style of leadership rather than transactional. In other words, management had a more personal relationship with their staff and, in turn, the employees felt that their bosses cared for them as a person (not as an input of production) and this was sufficient to break the cycle of mistrust.

The outcome of this whole research was that sometimes it is hard to parachute in managers from other parts of the world and expect things to work well here. Many managers are schooled in management theories from business school, or are operational people who were really good in their jobs and rose up through the ranks, or maybe sales people who dealt with people on the outside most of the time. Most of them seem to think in terms of transactions - "I pay you well, you serve me well." / "You served me badly, you must improve or you will be fired."

Perhaps in countries like Malaysia where trust for institutions is not so good, the best way around this is to build strong interpersonal (one-on-one) relationships.