16 May 2009
It is about 12 hours to the time I will depart from Singapore’s Changi Airport and begin the great adventure that is BSM Scandinavia. I thought that I would jump the gun a little for this travel journal and jot down some of my pre-trip thoughts. I am filled with such great excitement for this trip! I am really looking forward to immersing myself in a whole new environment, soaking up the culture, discovering the people’s way of life, understanding the rationale behind the way they do things. Also, it is not only about learning the ins and outs of Scandinavia, but being able to apply this new knowledge in my life and bring it back to sunny Singapore.
I am particularly interested in visiting Scandinavia because it ties in nicely with the research I’m currently doing with a professor from SMU’s Organizational Behavior and Human Resources department. Briefly, I have been assisting this professor in research and teaching duties since September 2008. Recently, we’ve been talking about starting a research study in one of the following areas: women in management, gender equality and work-life balance. I think it is fantastic that these are actually some of the most pertinent issues that managers in Scandinavia are concerned with. So in a sense, I am getting a great head start on my research through interacting with Scandinavian professionals who have been long-time proponents of gender equality and work-life balance.
In this trip to Scandinavia, I hope to learn about the region’s social democratic political system and its associated influences in the Scandinavia business and work environment. Through the Work-Life Balance seminar organized by NTUC, I have come to appreciate the huge role that public policy can play in shaping the workplace environment. To quote one of the speakers, “Societal change does not come of itself. Change has to be led by political will and decisions, mirroring values and norms in the population”. I believe that this is the success formula for Scandinavia, helping them to maintain a high fertility rate of about 1.8-1.9, along with a high 80% of women in the workforce. In contrast, Singapore’s fertility rate is only about 1.2 and with only a little over 50% of women in the workforce. Singapore has much to learn from Scandinavia in this respect. Scandinavians have great work-life balance and they are among the happiest workers in the world. Still, numerous thriving, profitable and productive multi-national corporations were able to emerge from this region. How do they do it?
17 May 2009
First Day in Scandinavia
We’re finally here in the humble land of frigid weather and open sandwiches. This is the place where blonde-haired, blue-eyed people pay high taxes, all in the name of socialism.
As we traveled from the airport in Copenhagen to Legoland in Billund, I was mesmerized by the scenes of natural beauty outside the confines of the bus. The landscape of Denmark is completely different from that of Singapore. There are cows and horses grazing upon Denmark’s vast green fields. Low-lying and sparsely distributed brick houses dot the land, adding cheery colors of red, yellow, brown and white to the greenery. Every now and then, tall wind turbines can be seen. They are emblazoned with the familiar blue logo of Vestas, a Danish company that our class learnt about in Singapore. As the trees and fields zoom quickly past, I try to get an intuitive sense of the spirit of Denmark. The tranquil natural setting mirrors the personalities of the Danes – understated and unpretentious. There is nothing too outlandish about Denmark. The homes are conservative and look just like one another. The people on the streets are dressed modestly. I have yet to see anyone carrying or wearing luxury brand apparel. Equality is an important aspect of the Danish way of life, and people are inclined to deflect attention by conforming to the status quo rather than attracting attention by standing out from the crowd. There is a Danish word “hygge”, which means “tranquility”. Before coming to Scandinavia, I had read up a little on the concept of “hygge”. It is, essentially, a complete absence of anything annoying, irritating or emotionally overwhelming and the presence of and pleasure from comforting, gentle, and soothing things. “Hygge” is often associated with family and close friends. For example, a group of friends sitting close together with candles lit on a cold rainy night is “hygge”. This idea of “hygge” has left an impression on me from day one of the business study mission. Not only have I observed “hygge” in the way that the Danes behave, but I have also had a heartwarming experience of “hygge” on my first night in Denmark. After an adventurous late-night walk through Billund’s neighbourhoods in the freezing cold and torrential rain, a few other BSM-ers and I hurried back to Billund Kro’s mustard yellow building, sharing a tiny umbrella that could barely withstand the strong Danish winds. As I stepped in the hotel’s warm, cozy lobby with some of the friends I have made during the BSM, I could not help but be reminded of “hygge”.
18 May 2009
Leg Godt, Play Well
Having grown up playing with LEGO bricks, it was definitely a great joy to be able to visit LEGO’s Billund headquarters; and to gain a deeper understanding of LEGO’s marketing, branding and manufacturing strategies. The various presentations given to our BSM group at LEGO’s Billund headquarters can be summarized in two statements. The first statement is “know your customers”. The second statement is “focus on your core values”. I believe that the concept behind these two statements account for LEGO’s successful revitalization.
It is very apparent that LEGO puts much thought and time into conducting market research of the various groups of LEGO users. The various user groups are based on geographical differences, age range, gender, and whether the user is a hardcore fan or just a regular LEGO user. For instance, LEGO differentiates between LEGO customers from the US and from Germany. American children prefer product packaging that gives off an evil, sinister feeling (e.g. dark black clouds). German children, on the other hand, prefer product packaging that is more happy and cheerful (e.g. blue sky, white fluffy clouds, colorful rainbow). Therefore, the same LEGO product may have different packaging, depending on the market that the toy is being sold to. Selling an “evil-looking” toy to German children is extremely tough as they are likely to end up frightened. Selling a “cheerful-looking” toy to American children is difficult as the toy may not be deemed as “cool” enough. Strategic marketing and understanding the nature of demand for LEGO is vital for the organization and has steered the company towards success.
Organizations must always ask themselves, “Who is buying this product? What are his/her needs and wants? How can I modify my product to cater to needs and wants?” A good marketer is aware of psychological considerations. In times of crisis, it is advisable for a company to “remember its roots” and return to its core. In 2004, when Lego was dealing with a business crisis, a major deficit and an uncertain future, it found that returning to its core was a good way to streamline the business and revive its corporate identity. Lego’s decision to return to its core, in terms of core assets, core capabilities, core values, core products, core consumers, core systems, was one of the best decisions it has made for the organization. Returning to the core allows the organization to assess where it has gone awry and shows the organization where resources should be allocated.
19 May 2009
Caring for People
Today was an intense day, consisting of two company visits and six talks. The speakers from both Grundfos and Vestas covered a wide variety of topics. As I integrate new knowledge from the various talks, one main idea seems to emerge strongly – it is important to care for people! The two companies we visited today have an essential element of caring for people, though not in similar ways. Grundfos’ strategy is illustrated in its Innovation Intent: Concern, Care, Create. Grundfos aspires to put sustainability first (concern), be there for a growing world (care), and pioneer new technologies (create). In particular, “care” refers to assisting the poverty-stricken developing world in obtaining clean water. Grundfos deeply believes that a business organization exists not just for profit-making purposes, but also to do something positive for the people of this world. Grundfos’ business objectives are very closely aligned with its humanitarian goals. I believe this is something that organizations from Singapore and all over the world can learn from.
Presently, a sizeable number of organizations practice corporate social responsibility in the form of humanitarian work. For instance, employees of Singapore’s DBS are encouraged to participate in humanitarian trips to third world countries in Asia. Through these service trips, employees are able to do their part for the less fortunate through engaging in community development activities such as refurbishing homes and rebuilding schools. These efforts are commendable; however, I feel there is much room for improvement in terms of how companies align their humanitarian and charitable efforts to their business mission and vision. Grundfos’s business is in the area of water pumps; hence it is logical for them to engage in CSR activities related to the provision of clean water resources. Likewise, a financial organization may want to consider providing micro-financing options to people from developing countries. This would better align its CSR efforts to its core business in the finance industry (as compared to just sending employees to developing countries for humanitarian work that is unrelated to its core business). Aligning an organization’s CSR efforts to its mission and vision will help to create a robust and unified image for the organization. This may serve a strategic business purpose. Vestas cares for people, in particular, its employees. The various speakers from Vestas made apparent to us that the company really cares for the work-life balance of its employees. For example, a department called “People and Culture” was created to oversee Vestas’ human resources. In Vestas, human resources has moved beyond its administrative function of performing traditional organizational tasks such as employee relations, recruitment and selection processes, benefits and compensation management. Human resources is now seen as a strategic function that can add value to Vestas’ business. In today’s changing and competitive market, organizations are realizing that strategic HR functions can contribute to the bottom line and further distinguish the organization from its competitors.
Organizations do not exist because of the machinery in the factories. Organizations exist because of the people in it. When the physical structure of a factory breaks down, an organization can always rebuild another factory in another location and continue its operations. However, if the people in an organization leave, the organization ceases to exist. An organization’s human resources are extremely valuable and it is important to care for them. In fact, organizations may deliberately tap into the potential of their employees, and utilize it to reach desirable organizational outcomes. It is time for human resources to move its focus from administrative duties to organizational strategy. Vestas definitely leads the way in the strategic involvement of human resources department in the organization’s business operations. The future of HR looks promising and has the potential to magnify profits and revenues for organizations by developing its people and nurturing its leaders.
20 May 2009
The Novo Nordisk Way
I was sincerely looking forward to visiting Novo Nordisk today. I have been fascinated by the company ever since I first heard about its achievements from Joshua and Derek who presented on the company in class. They explained to the class that Novo Nordisk is the world’s leading producer of insulin and a leading company in diabetes care. Notably, it is ranked 57th among the top 100 best companies to work for. What is it about Novo Nordisk that warrants its receipt of this ranking? The speakers at Novo Nordisk’s office were able to give me good insight into why Novo Nordisk’s employees think and feel that Novo Nordisk is such a great place to work. Like most other companies, Novo Nordisk has an HR function that cares for its employees’ welfare and develops people’s talents. Various HR and employment policies help to build a supportive work environment in Novo Nordisk. However, as the speaker, Sebastian, mentioned, employer branding plays a big role in promoting Novo Nordisk as an ideal place for people to work. Hence, it is not just about having great HR policies (“People Strategy”), but also about actively promoting and branding the company as an ideal workplace (“Branding Strategy”). Employer branding is the process of building and supporting a unique and strong employer identity. It seems that employer branding gives an extra edge to companies like Novo Nordisk, especially in terms of recruiting and retaining the best minds and talents. Employer branding can actively shape, and in a sense, manipulate the images and perceptions that employees, potential employees and related stakeholders have of the organization. A strong “People Strategy” can build a strong supportive work environment. However, a strong “Brand Strategy” can further enforce the image of a supportive work environment in the minds of employees. This added dimension helps define the image of the organization as a “great place to work” in the mind of current employees and key stakeholders. Hence, companies that actively employ employer branding, like Novo Nordisk, rank higher on the lists that rank the quality of work environments. When these employees are asked about their companies, a strong and clear employer brand emerges. The idea of employer branding is something quite new to me. I am fascinated by how it is possible to merge an organization’s human resource, marketing and communications functions to add value to a company’s success by creating a strong employer brand. Employer branding builds upon the belief that human capital brings value to a firm and it creates a competitive advantage for the company. In fact, employer branding may be the most powerful tool a business can use to emotionally engage its employees.
25 May 2009
Scandinavian Organizational Culture and Leadership
In our visits to REC and Orkla today, we learnt about the concept of organizational culture, from a Scandinavian perspective. The OBHR modules that I have taken in SMU have taught me that an organization’s culture is defined as the values and norms that are shared by people and groups in an organization. The values and norms shape the way they interact with each other and with stakeholders outside the organization.
Svanaug Bergland, Senior Vice President of Organizational Development and Corporate Communications, spoke to us about developing the corporate culture and leadership practices in REC, one of the world’s leading solar power companies. She impressed upon us that it is essential to have a clearly defined corporate culture, especially in a young organization like REC that is expanding into a wider range of activities – operationally and geographically. A powerful organizational culture is able to unify all members of an organization. In fact, organizational researcher Edgar Schein from MIT, who specializes in organizational development, defines organizational culture as a “shared pattern of basic assumptions in a group”. In a sense, organizational culture gives employees a common base to tap into. It is the invisible glue that holds separate individuals together as a single entity.
In many companies, organizational culture is reinforced with cultural artifacts which may include visual symbols like a common uniform or a company handbook. REC’s organizational culture is deeply anchored in its management style. Every manager in REC is selected, promoted and rewarded based on his/her performance on various strategic core values. The organizational culture at REC is enforced by the company’s human resource policies. For instance, leaders at REC are evaluated based on their adherence to REC’s core values of “Responsibility, Enthusiasm, Commitment, Innovation, Drive” rather than financial performance. Specifically, only 20% of an employee’s performance is based on his or her financial success. In another example, potential employees are hired based on whether their personal values are aligned with REC’s core values. This concept is known as person-organizational fit – a company should consider the ability of a potential employee to fit well into the organizational culture in the recruitment process. No matter how capable a particular person is, if his working style is not a good match with the company culture, then he cannot perform at his highest potential and certain problems may arise at some point in the future.
REC’s organizational practice of “job discussions” intrigued me immensely. In my opinion, an ideal workplace is one which respects the voices of employees, promotes the growth of employees, and empowers employees to shape their own careers. Job discussions do exactly that! Job discussions are commonplace in the Norwegian workplace, which is characterized by a low power distance culture. JDs systematically ensure that the individual employee’s goals and objectives and those of REC are in synch, thereby promoting organizational effectiveness, productivity and motivation. In high power distance cultures like Singapore, supervisors have a lot of control over their subordinates. Hence, goals and objectives for an employee are likely to be dictated and forced upon him as a compulsory duty.
Job discussions are a human resource dream, but how practical are they? Does it make sense for a supervisor to sit down with each and every one of his subordinates to discuss their goals and objectives for the year? Proper and thorough JDs would require a fair amount of a manager’s time, energy and resources, which could be spent pursuing other organizational goals. However, Svanaug Bergland is confident about the benefits of JDs for employees, managers, and the organization as a whole. She feels that JDs are something that all companies should conduct and I am persuaded by her arguments. I feel that Singaporean managers have much to learn from their Norwegian counterparts in terms of being more open to suggestion from others, and inviting contribution and involvement from their subordinates.
In our later visit to Orkla, Svanaug Bergland’s arguments about the importance of organizational culture were further supported. Geir Aarseth, with a corporate background in human resource management and leadership development, spoke to us about the unique organizational culture at Orkla. Orkla’s culture is founded upon the three Ps: Persistence, Passion, Precision. These values are passed on and communicated to Orkla’s employees through Orkla Academies, which are schools that have workshops on company culture, functional skills and leadership development. Geir Aarseth’s presentation focused more on the characteristics of Scandinavian leadership. How are Scandinavian business leaders different from leaders in other parts of the world? Are there any cross-cultural differences?
The hallmarks of Scandinavian leadership include an egalitarian style, a horizontal structure with minimal hierarchy and low power distance. Employees are heavily involved in the decision making process. Again, the management style of Scandinavian leaders is a human resource dream. HR textbooks have always espoused a management style that is open and inclusive, rather than closed and authoritarian.
In my opinion, a strong leader is one who is able to blend both the egalitarian Scandinavian style and the traditional authoritarian style. A leader who is too egalitarian may lose control over his followers, while a leader who is too controlling may abuse his power and lose the respect of his followers. An intelligent and effective leader is one who knows which leadership style to adopt in different circumstances. Some circumstances may call for the leader to be more open-minded and involve his employees. However, in emergency situations, a leader may need to make quick decisions at his own discretion, rather than consult the opinions of his men. If he uses an egalitarian style in an urgent situation, important decisions may not be made in time and, hence, his leadership may be ineffective.
28 May 2009
Hansa Borg – Quintessentially Scandinavian
We had our very last company visit today to Hansa Borg – Norway’s largest Norwegian-owned brewery. As I listened to the last company presentation for the BSM, I began to connect the dots between the various companies we have visited and a compelling picture of Scandinavian business culture began to form in my head. The quintessential Scandinavian business can be best described in three words – sustainable, values-based and people-oriented. The business policies and practices in Hansa Borg, and the majority of the companies that we have visited thus far, fervently pursue activities in these three areas. In fact, there is a common consensus that businesses are not encouraged but expected to have sustainable, people-oriented and value-based business practices.
As we toured Hansa Borg’s massive warehouses and production facilities, we were educated on how Hansa Borg tries to do its part for the planet by recycling and reusing its drink bottles. When consumers throw away their plastic drink bottles after drinking, the bottles will accumulate in waste dumps. The amassing of non-biodegradable bottles in landfills is not a sustainable practice. By reusing plastic bottles, Hansa Borg is minimizing waste and working with the philosophy of “Against Throw-awayism”. I first heard of the philosophy of “Against Throw-awayism” when researching about the Finnish design company called iitala. The founders of iitala believe that in our present consumerist culture, we get into the habit of buying items with very short lifespans. When they go out of style or spoil, we throw them away, generating a lot of waste. Iitala creates timeless products with long life-spans so that we never have to throw them away, thereby supporting a more sustainable planet. Similarly, many Scandinavian companies seek to make their operations more efficient and more sustainable for the planet.
I think that the abundant nature that is everywhere in Scandinavia has embedded the environmentally-friendly mindset in the people here, such that it is natural to desire to maintain the beauty of the natural landscapes. When you are waking up to majestic snow-capped mountain ranges and magnificent lakes every single morning, you would be inclined to take action to preserve these awe-inspiring sights. Perhaps in Singapore, as we are surrounded by a dense concrete jungle, it is difficult to understand the necessity to “go green” and “save the planet”. However, in Scandinavia, daily interactions with the surrounding nature make it natural and obvious for every person to want to be Captain Planet. As a matter of fact, I am currently typing this journal on the bus and we are driving past an amazing lake with such calm crystal-clear waters, like nothing that I’ve ever seen before. Towering coniferous trees and shrubs line the edges of the colossal water body. The picturesque lake is backed by grand mountain ranges and an azure blue sky. It feels so surreal to me, almost like I am living in the world of a Photoshop-ed postcard picture. Nature is everywhere and so stunning. I would never ever want to do anything to destroy or harm the stunning natural beauty that greets my eye. I would want to do everything that I can to protect planet earth.
Now, I will go on to the second characteristic of Scandinavian businesses – People-oriented. The speakers from Hansa Borg elaborated on its core value of People. Hansa Borg believes that you need to care for your employees and make your employees happy for them to perform at 100% for work. Happy and satisfied workers are hardworking and productive workers. To keep their employees happy, Hansa Borg organizes a lot of welfare events and parties, e.g. Christmas get-togethers. While Hansa Borg’s approach is more fun-oriented and event-based, other companies have taken a more long-term policy-based approach. For example, Vestas’ People and Culture department oversees the application of human resources as a strategic function to achieve positive organizational outcomes. Good human resources policies have the potential to bring a company to greater heights by developing its people. Therefore, it makes good economic sense to invest in the people of a company. In fact, the young employees of today expect their employers to treat them with respect and dignity. They expect to be valued as unique individuals, rather than mere cogs in a machine. To remain competitive, businesses can no longer treat their employees as lifeless resources or commodities. All employees are humans, and to be human is to be irrational, passionate and emotional. An uncaring, dull and meaningless workplace would definitely demotivate employees from performing at their best. It would diminish individual inspiration and kill team spirit – the very forces that drive organizational success.
I think that the history and geography of this region makes people inclined to treasure one another more. In the dead cold of a Scandinavian winter, the best warmth you can get is the affection from and connection with another human being. I will use Norway as an example. Norway has a tiny population of 4.5 million people, spread over vast acres of land. The paucity of human life around Norway (especially if we would compare the population density of Norway to that of Singapore) makes them cherish every single person more. Every person that you meet is special and brings you warmth and happiness in the cold of winter. In a dense city like Singapore, we see people everywhere. Consequently, we tend to take the human connection for granted, and we forget to treasure people.
Lastly, Hansa Borg is founded upon three important core values: People, Branded goods and Fun. These values are not superficial values that were chosen for mere “public relations” purposes. Hansa Borg deeply believes in living by these core values and uses these values as a competitive advantage. It is a strategy of differentiating themselves from their competitors. These values also guide their organizational and management policies, e.g. recruitment, promotion, etc. Numerous other companies that we visited also demonstrated a very values-based management style. For example, it became apparent in our visits to REC and Orkla that both these companies put a lot of emphasis on choosing and then maintaining their core values. Notably, REC evaluates its employees based on values-based performance rather than mere financial performance. It is about how their employees are best able to embody and endorse the essence of the company’s values, rather than just about how they can contribute to the organization economically.
To end off this entry, and the entire journal, I would just like to say that I truly admire Scandinavian companies for being pioneers in changing the business world. In the past, being a corporation meant being materialistic, unethical and uncaring. Now I see the potential and power that corporations have in changing the world and making the world a better place. With the looming environmental and economic crises, it is time for businesses in all corners of the world to rethink their purposes and their missions. I am quite idealistic and am hopeful about impending changes that will take place in business organizations in the next few years. I foresee that global business organizations will begin to follow in the footsteps of the Scandinavians, and strive to be sustainable, ethical, and caring. Corporations will no longer be equated with money-hungry profiteers who exploit child labor so as to save operational costs and who force the masses to buy things they do not need. Corporations will actively play a part in protecting our planet and developing people to their fullest potentials.
Overall, this BSM has been an incredible cultural immersion experience for me and I have so many memories that I hope I never forget (though I probably will as time goes by). Everything has left an impression on me – piecing toy bricks together at Lego, experiencing the virtual stimulation at Vestas, devouring open-faced sandwiches at various companies, drinking beer at Hansa Borg. BSM- aside, I also really enjoyed all non-BSM-related activities – shopping at Copenhagen’s Stroget and Gothenburg’s Haga district, browsing the art and design pieces at Rossa Muset, exploring the exotic hippie town of Christiana, visiting the beautiful sculpture park in Oslo, taking the scenic Flamsbana train ride, sightseeing at the historical Bryggen in Bergen, the futuristic Turning Torso in Malmo, the charming stave church in Heddal, and so on. I have been making new friends, deepening old friendships, delighting in new experiences. It’s all part of my travelling journey and I hope to keep seeing more of the world and broadening my horizons, to keep growing and learning.
– Madeline Ong