Certificate of compliance template

Standardizing human resources procedures can help improve employee and organizational performance

All countries want a domestic workforce versatile enough to keep pace with economic expansion. This goal is especially pertinent in China, where multinational corporations' (MNCs) headquarters often direct their China operations to find Chinese (as opposed to expatriate) managers. But Chinese cultural, political, and procedural barriers are hard to surmount, and MNCs in China often complain that Chinese employees have difficulty carrying out basic tasks. Yet many MNCs do not clearly convey to local employees what actually needs to be done and why. Part of the problem lies in the absence of standardized, transparent human resources (HR) procedures in many MNC operations in China.

A sound understanding of corporate strategy is necessary to make sure HR practices are suitable for a particular set of employees. In general, the goal of the HR department is to improve performance of, retain, and motivate employees. As far back as 1984, MNCs in China recognized that their HR departments were having difficulty ensuring adequate employee performance. Much of the problem stemmed from the fact that HR management itself is often a local function. These locally staffed HR departments have long filled important HR positions with Chinese managers, many of whom do not fully understand the company or Western HR methods. In China, foreign companies have often created HR managers by moving managers horizontally from other departments.

Human resource development and ISO 9000

Many Western MNCs in China today could benefit from using the human resource development (HRD) system-a system that encompasses skills transfer, instructional design, needs assessment, organization development, succession planning, and career development projects. Though HRD docs not identify compensation, it is beginning to link overall competence to reward. The HRD system can be used to enhance the strategy, structure, and efficiency of any organization or group, regardless of size. In short, HRD recommends specific interventions (both instructional and non-instructional) to solve human performance problems. Instructional interventions include training, classes, and consulting; non-instructional interventions include succession planning, organization development, and career development. HRD draws from the fields of management, education, and industrial psychology and is best used in environments in which considerable organizational or social change is occurring rapidly. To use HRD effectively, companies must clearly understand HRD and communicate their goals to their staffs.

ISO 9000 is an organization documentation procedure based on integrity and compliance standards that are globally certified and accepted. ISO 9000 promotes continuous improvement through corrective action. ISO 9000 can help an HRD effort in China by documenting accountability.

ISO 9000 is not quality control (QC) or total quality management (TQM), though many companies in China market it as such. ISO 9000 only demonstrates to customers and vendors that the organization follows a documented procedure that has been independently audited for international compliance. ISO 9000 can fit well within a TQM process, but it only verifies procedures by way of files and paperwork. ISO 9000's overall objective is to be a "fitness for purpose" test. A company can be ISO 9000 compliant and still have shoddy products. Conversely, a company producing high-quality products may not possess an ISO 9000 certificate (though this is rare).

ISO 9000 cannot offer any insights into the "quality" of an organization's training and HRD programs, but it does offer a way to document and organize a company's training and HR compliance. ISO is most useful for mapping people's competence, awareness, and training.

Bringing ISO 9000 to China HR

Since HR is the local implementation of a corporate strategy, the incorporation of both national and corporate culture is paramount. The ISO 9000 documentation process is the key, because it forces companies to state their objectives and expectations clearly. This is also the core of career development theory: aligning people's needs with organizational strategy.

Because companies must submit a written plan to get ISO 9000 certification, the system forces managers to sit down, think about their HRD strategy, and clearly define what they want their people to be able to do and demonstrate. Only the company can decide how "good" its HR plan needs to be, but it is worth incorporating as much detail as possible. The objective in China is to promote training stability and compliance, which will push many organizations to their goal of total localization much more quickly.

More important, many MNCs now operating in China require their vendors and clients to be ISO 9000 certified. But they must be certified by December 15, 2003, when the old ISO 9001, 9002, and 9003 standards will expire (see p.47). Many smaller companies, especially local Chinese vendors, are not taking this deadline seriously. This lack of readiness is a serious matter for several reasons. ISO compliance cannot be acquired overnight; it requires a thorough systematic and strategic plan. And many Chinese companies and some joint ventures have no discernible HR department, let alone a plan.

Companies currently invested in China with well-established HRD systems, such as Motorola Inc., 3M Co., Nestle SA, and General Electric Co. would probably benefit little from an ISO 9000 initiative for HR because they already have their own documented procedures for measuring employee performance. Small and mediumsized companies would benefit the most from ISO 9000 certification.

ISO 9000:2000A template for HR success

Many foreign ventures now entering the country have no idea where to start developing a training/HRD program for local personnel. Training and development plans brought over from the home country and installed in China are often ethnocentric and thus must be adapted for China. Nonetheless, many MNCs attempting to save money and cut costs make this mistake-with disappointing results. The most successful training programs blend home office competencies with the cultural, political, and socioeconomic values of the foreign subsidiary's home country.

For HR certification, the most important parts of the ISO system are the 9001 certification level for complete (design to finished product) overview, and inside that, Section 6, which is a small but powerful section regarding HR. Another important part of the ISO system in terms of HR is ISO 9000:2000 Section 6, which tests an organization's ability to define the HR standards that it wants to incorporate. The essence of ISO 9000:2000 Section 6 is:

* Describe what you do. [Position documentation on file]

* Do what you say. [Employee documentation on file]

* Record what you did. [Management documentation on file]

* Check on the results. [Analysis undertaken of the measurement]

* Act on the difference. [Corrective action noted and on file]

ISO 9000:2000 details "resource management" under Section 6.2 and requires detailed HRD documentation under Section 6.2.1-where management must ensure a demonstrated commitment to human resources for achieving and identifying corporate objectives-and Section 6.2.2-for competence, awareness, and training. ISO 9004:2000 expands the 9001 certification in human resources with specific documentation for verifying that such a plan really exists. In short, ISO 9001:2000 gets the user to compliance and certification, while ISO 9004:2000 takes the organization beyond compliance and can be used to enhance and build a quality program. This is particularly important in China, where HR has historically been exemplary at meeting (and only meeting) requirements in order to put people to work.

Certification in the area of Section 6.2.2 means that management has analyzed the performance gap between "what is" and "what should be" in the organization (see Table). Management is also willing to provide skills training to complement the individual's current experience and increase his or her overall competence. This skills training should also highlight the importance of satisfying customer and vendor needs and include the consequences to the company and the individual of failing to meet these needs.

Invest time now for good HR later