The Morning Eclipse

Thursday, July 05, 2007

How far can we care for our employees?

Caring for the company employees has been a very difficult subject. Some people call the employees as investment and some just plain consider them as a cost to business.

A not-so-recent book, Pour Your Heart Into It, details the story of Howard Schultz and his Starbucks' story. He tells it with great passion on how he took care of his employees. First by giving them above par benefits and wages, calling them Partners and then pioneering Share Options for a private company. All these he did in the first six to seven years of his fledging baby project.

All I can say is Howard's a very lucky guy. From the first day of operation, sales have been exceeding expectations. Plus, selling coffee at 3 dollars a cup when the most expensive coffee around that time only ran around 50 cents, gave him huge margins at big volumes. His story is my dream!

Looking at this subject from the opposite perspective, let's observe the SM model. Our very own SM employs contractual employees. These people get fired every 5 months and another horde of replacements take over. They get no benefits and have zero job security. I know this sounds harsh but there are good reasons for such a decision.

SM wants to avoid the labor unions. A strike by a union can cripple its operations. Aside from getting contractual employees, SM also registers each branch as a different corporation. This way, if for some chance a union is able to form and strike at say SM Manila, only SM manila gets affected. Other branches cannot legally strike at the same time. You see, union law states that a union can only exist within a corporation and separate corproation ensures isolation of potential labor problems.

Another reason why some employers could not care less is the theft issue. It's just unbelieve that some employees will even steal the most unthinkable things. From secretly selling charcoal to padding up the sale price. Small things matter.

Obviously, there are many benefits for choosing either path. One thing I learned though is, there are many ways to approach a solution. Choosing which option is just a preference. If you work hard and give your best effort, being the best employer or the most cost effective one will work either way.

Success is 1% inspiration and 99% perspiration. Never tire.