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The Pressure on human resource management of Vietnamese CEO in the 4.0 period

Thursday 17, 10 2019
“The Industrial Revolution 4.0 is posing challenges to administrators, especially in the field of human resource management in small and medium-sized enterprises ”
The Pressure on human resource management of Vietnamese CEO in the 4.0 period

So, how do CEOs have to develop human resources strategies before the 4.0 wave? The interview with CEO Le Dung will help answer a part of this question.

In the context of the Industrial Revolution 4.0 happening strongly, is there any change in the use of human resources in Vietnam?

CEO Le Dung: With artificial intelligence and robots doing simple jobs, workers around the world will face unemployment in jobs that require little intelligence and have repetitive nature. In Vietnam, we can see some jobs have been gradually replaced by technological applications such as taxi operation, warehouse management, or using artificial intelligence in translation, positioning, etc. Personnel to do these jobs will be more "idle" or will even be completely cut back.

With the support of online management software, surely the employees must also have certain skills related to information technology, so how do you evaluate these skills in Vietnamese workers?

CEO Le Dung: Vietnam has the advantage of having a young population, and on the common ground, this is Vietnam's strength in accessing information technology. However, in reality, young workers are often inexperienced ones. Meanwhile, a large proportion of workers aged 40 to 60 with long-term working experience and strong professional skills often face the risk of information technology fogginess. This is not only a problem for individual workers but also a problem that many businesses, and even the economy, need to face and have solutions to overcome it.

Does the difficulty in accessing the technology of a part of workers affect labor productivity?

The impact on labor productivity is a natural course. A job supported by applications will undoubtedly be more productive than manual work. Actual reports are pointing out that Vietnam's labor productivity is lower than other ASEAN countries such as Thailand and Singapore. The slow access to technology and the application of scientific and technological advances in production in Vietnam is still slow compared to other countries’ is considered one of the main causes. Labor productivity is the core competitive value of businesses and countries.

Thus, from a fundamental problem of the slow access to technology in the 4.0 industrial revolution, it can be seen that there are many consequences for businesses and the economy. I think this is certainly something that many businesses have seen, but what difficulties do they encounter with HRM strategies in the 4.0 period, especially in small and medium-sized enterprises?

In the last 4 years, the demand for recruiting high-quality personnel in Vietnam has increased by at least 20% a year. However, the domestic labor market does not provide enough supplies. Especially, in the field of information technology, it is forecasted to be short of about 500,000 to one million candidates.

Supply not meeting demand is the difficulty for businesses in recruiting personnel. Especially for small businesses, this difficulty is dozens of times more difficult. There are businesses that are willing to give up a huge salary to recruit talented people, but the recruited staff only worked for the short-term and then left claiming that the small businesses are not challenging enough for employees.

The human resource problem sometimes becomes a vicious circle making it difficult for small and medium enterprises to develop. According to data from Vietnam White Book in 2019, it has nearly 714,000 active businesses, of which, small and medium enterprises account for over 90%. Therefore, the problem that small and medium enterprises are facing in personnel management in the 4.0 period is not only a difficulty in enterprises but it is also a common problem of the national economy. Research is needed to support these businesses.

With experience in doing business in the market as well as a long-time working in the field of personnel training, what advice would you give to managers in small and medium-sized enterprises to deal with the 4.0 wave? 

I think businesses need to focus on personnel training. Especially for small businesses instead of looking for good candidates, we need to focus on training the staff who are ready to work for the business at the present time.

Secondly, after training, enterprises should have policies to keep them from training other businesses. To retain workers, there is no other way but work and stable income.

I especially noted that starting a business, in order to stabilize labor, retain good people and continue to grow, in the early stages, businesses should not think about profits.

I especially note that starting a business, in order to stabilize labor, retain good people and continue to grow, in the early stages, businesses should not think about profits.

When executing contracts with partners, if the contracts break even but there is still work for laborers to work continuously, the enterprise should do that.

Thank you, hopefully with your suggestions in today's talk, small and medium-sized businesses, startups will have the right direction in the personnel development strategy. in the 4.0 industrial revolution period.

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