What SMEs in Malaysia need to know to attract and retain talent

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    • SMEsSMEs
    22 December 2020

    Key Takeaways

    • To attract and retain the best talent, it is necessary to provide fair pay and benefits, but it is equally important to maximise employee engagement.
    • SMEs should adopt training and development initiatives — to nurture talent, increase productivity and re-train workers if required
    • Employers should engage employees to design the ideal employee benefits packages
    • UOB offers a valuable and competitive employee benefits plan that helps SMEs to attract and retain their employees

    Employee engagement is essential for recruiting and retaining talent


    A recent Malaysia’s research on employment practices mentioned that recruiting and retaining qualified and talented employees means more than just offering competitive salaries. It is also important to ensure that those hired develop a strong engagement with the company.

    In the Malaysian private sector, increased job satisfaction, stemming from greater job autonomy, was found to have led to higher productivity and to have decreased the costs of hiring new employees, thereby increasing company profits1. In Malaysia’s IT sector, talent management practices such as providing managerial support, employee career development, and rewards and recognitions produced higher engagement. The result is employees tend to stay in the same organisation for longer2. This is supported by a study of worker retention in Proton factory that recommended a focus on employee engagement strategies to increase worker loyalty3.

     

    A better work-life balance increases engagement and attracts talent


    Increased engagement is also linked to the work-life balance enjoyed by employees, which directly affects their quality of life, as shown by a study of young adults in the banking sector in Malaysia4. Given the tendency of young people in banking to "job-hop", there is a need to increase their engagement so that they are not continually looking for greener pastures elsewher5 . Improved quality of life can also reduce staff turnover: among Malaysian accounting professionals, there is a negative correlation between the quality of life and turnover, with work-life balance the most significant indicator of turnover intent6. While many workplaces in Malaysia have implemented family-friendly working practices, there remains a gap between such practices that enhance the quality of life of the workforce and the actual needs of workers in government and private organisations7. In the country as a whole, effective work-life balance practices are sorely lacking, especially for those industries that needed the most8. Therefore, SMEs that can provide a good work-life balance to their employees will enjoy a competitive advantage.

     

    A good training programme attracts and retains good workers


    Once hired, workers need to be trained continuously to ensure they can master the latest technology. Training is one of a major factor in attracting and retaining good talent as employees will likely to stay with an employer who provides adequate training opportunities. A study of workers in a college of technology in North Malaysia demonstrates that training and development increase job satisfaction9. Likewise, a study of SMEs in Malaysia has shown that employees are looking for better training opportunities as well as appropriate remuneration and recognition10.

     

    Employee participation can strengthen the design of employee benefits packages


    A company that communicates well with its employees and involves them directly in designing their own benefits packages can reap the benefits of increased trust as workers become more satisfied with those benefits and so are keen to join the company and stay with it11. It is also important to involve employees in identifying practices that can create and sustain a healthy working environment to minimise accidents and health problems12. Team-based ergonomic job redesign has been found to reduce lost production time13.

    UOB was named the best SME bank in the region because of its "beyond banking" approach" and offers a competitive employee benefits plan to suit your needs.

    Get in touch with us to find out more.

     

    1 http://article.sapub.org/10.5923.j.hrmr.20130301.09.html

    2 https://www.researchgate.net/profile/Nurul_Ezaili_Alias2/publication/311614493_Examining_the_Mediating_Effect_of_Employee_Engagement_on_the_Relationship_between_Talent_Management_Practices_and_Employee_Retention_in_the_Information_and_Technology_IT_Organizations_in_Malaysia/links/5a212b83aca272ab5a623b68/Examining-the-Mediating-Effect-of-Employee-Engagement-on-the-Relationship-between-Talent-Management-Practices-and-Employee-Retention-in-the-Information-and-Technology-IT-Organizations-in-Malaysia.pdf

    3 https://www.qurtuba.edu.pk/jms/default_files/JMS/13_3/08.pdf

    4 https://www.researchgate.net/profile/Ibiwani_Hussain/publication/314525193_The_Influence_of_Intention_to_Leave_Towards_Employee_Engagement_among_Young_Bankers_in_Malaysia/links/5addc4f5a6fdcc29358b9aaa/The-Influence-of-Intention-to-Leave-Towards-Employee-Engagement-among-Young-Bankers-in-Malaysia.pdf

    5 https://www.researchgate.net/profile/Ibiwani_Hussain/publication/314525193_The_Influence_of_Intention_to_Leave_Towards_Employee_Engagement_among_Young_Bankers_in_Malaysia/links/5addc4f5a6fdcc29358b9aaa/The-Influence-of-Intention-to-Leave-Towards-Employee-Engagement-among-Young-Bankers-in-Malaysia.pdf

    6 https://link.springer.com/article/10.1007/s11205-013-0486-5

    7 http://www.jgbm.org/page/16%20Aminah%20Ahmad.pdf

    8 https://www.elgaronline.com/view/edcoll/9781783475087/9781783475087.00017.xml

    9 https://publisher.uthm.edu.my/ojs/index.php/jtmb/article/view/1628

    10 https://muse.jhu.edu/article/619673/summary

    11 https://www.sciencedirect.com/science/article/abs/pii/S1053535700000834

    12 https://psycnet.apa.org/record/2009-08129-002

    13 https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1744-6570.1994.tb01582.x

    14 https://www.theasianbanker.com/updates-and-articles/uob-awarded-best-sme-bank-in-singapore-and-in-asia-pacific-at-the-international-excellence-in-retail-financial-services-awards-2020

    Key reasons why every SME must have an employee benefits plan

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