I. Examine Hayco’s employee compensation and benefits program. Why did Hayco invest money and effort in building Hayco Home?
Fringe benefits costs are known to be little but it could yield potential benefits for both the employer and the employee as well. Mr. Donald Hay, president and CEO of Hayco Manufacturing Limited, noted that getting skilled labor has been one of the biggest problems that the company faces. Accordingly, they could not make products to the SIX Sigma quality levels without them. Hayco adapted a quality-oriented strategy as to decrease defects, at the same time, lower its manufacturing costs. This strategy can be carried out if the company has employees that are dedicated, well-trained and focused on quality. The production process involves the assembly of multi-component products that require a demanding and detailed work. As a result to this need, the company built the Hayco Home for their employees - an accommodation facility designed as the state-of-the-art “home-away-from-home” for the company workers.
The Hayco Home was built because according to the president of Hayco Manufacturing Limited, Mr. Donald Hay, the company has realized that human resource is one of the most essential factors that contribute to successful manufacturing. As China’s industrial sophistication increases, its manufacturing environment gets even more competitive. To address this matter, Hayco Manufacturing is committed to the provision of a clean, well-equipped and safe work place for its employees of all levels, at the same time, adhering to equally high standards in accommodation, food and other benefits.
Benefits also include the safety and security of the plant and the dormitory with preventive maintenance program of electricity circuit, fire precaution system and production equipment as well as safety training classes for all employees. In terms of security, all employees of Hayco must show their employee identification pass to enter the premises. Welfare benefits also include free medical services for its employees with clinics that are complete with first aid equipment and qualified doctors and nurses to provide medical consulting services to all its employees, in addition to the free life and injury insurance provided by the company.
Hayco also has a welfare committee to monitor the quality of welfare that the company provides to their employees and at the same time, acts as mediator between management and workers in association to the company’s welfare polices. Hayco Home also offers a wide variety of facilities such as a grocery store at prices lower than the market. It also has a hair salon which provides cheap and convenient hair care services, as well as telephone booths available to use and various interest or hobby classes like sewing, knitting, dancing, make-up and English classes which is free of charge. Aside from the aforementioned benefits, the company also provides recreational services for its employees such as a football ground, a basketball court, a badminton court, table tennis, an American pool, a karaoke room, library and reading room, a dancing room, a chess room, a recreational park, a bowling alley and an internet café as well.
II. Assess management philosophy as reflected in Hayco’s benefits policy. What are the long term effects from the benefits offered?
According to Hay, president of Hayco Manufacturing Limited, “No matter how advanced and highly developed a company’s technology is it is only as effective as the people operating it. Taking the best possible care of our employees is the basis to improve productivity, retain staff and improve efficiency.” The management team of Hayco Manufacturing Limited claims that hardware and pieces of machinery can easily be replicated by competitors, whereas, employees are unique individuals who need to be treated as assets; employees need to be taken care of and respected. As reflected in Hayco’s benefits policy,...
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