Key Trends in 

Management Careers 

(Southeast Asia)

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1. Localization Continues
 
It has taken many years but today most multinational organizations have come to the remarkable conclusion that Asians are suitable to lead other Asians. The majority of multinational organizations that have not already done so have plans to migrate senior management roles to Asian nationals in the not-too-distant future. 
 
There are 2 main reasons behind this trend. First, is the simple concern about cost. Base compensation levels for locals and expatriates have mainly converged, but expatriates have traditionally been provided with expensive benefits such as executive housing, international schooling for children, annual fly-backs and so on. This “expat package” adds tremendously to the overall cost for expatriate managers.
 
The second benefit Asian managers bring is local knowledge. Business in Asia is more relationship driven that in the west and it reasonable to say that someone who grew up in a local environment will be better off than someone who is new to the country. 
 
 
2. New Demand for Expatriates
 
The enormous depth and quality of Asian workforces and high-growth markets is inspiring global companies to open new operations and expand existing ones. Expatriates are required in many countries where adequate supplies of local managers have yet to be developed to meet high demand.
 
Across Southeast Asia, there are different needs depending on the country. In Singapore, expatriate managers are said to be required in creative industries like media and advertising. In Philippines, the booming phenomenon known as Business Process Outsourcing is responsible for large demand. In Indonesia, it’s infrastructure and mining and, in explosively growing Vietnam, expats are required in most sectors. 
 
 
3. The Vanishing Expat Package
 
In the good old days, it was standard for expatriates to be provided with luxurious benefits to keep them comfortable during “hardship postings” in Asia. These included executive housing (including servants), automobile & driver, expensive international schooling for children, annual fly-backs for the entire family, country club memberships and even a “hardship bonus” that alone added 20% - 40% to base compensation.
 
Except for a few hold-outs, the traditional “expat package” has gradually but steadily been eroded over the past decade. Far from being considered an expatriate’s right, today everything is negotiable. Companies often still provide financial support to their relocated managers but the amounts and types are gradually being reduced. 
 
 
4. Income Convergence
 
Most people in Asia still think expatriates earn more than they do but the fact is that most of these differences have already been minimized. In advanced commercial centers like Singapore and Hong Kong, equal-pay-for-equal-work has been a reality for some time. In emerging countries, the situation is still evolving but the trend is well advanced even there. 
 
Across Asia, local managers in growth sectors have seen relentless salary increases and many earn as much these days as any expatriate could ever hope for. 
 
 
5. Cross Postings Open to All
 
It used to be that overseas executive postings were top down in nature. Managers were sent from head-quarters to a far-flung country office for experience. They would spend 3 or 4 years dictating company operating procedures to local staff whose performance was measured by how well they complied. There was little opportunity for “locals” to aspire to senior management within their own country let alone outside it. 
 
Today, Indians, Filipinos, Malaysians and Singaporeans all can be considered for the top jobs in their own countries and have the same cross posting opportunities in other countries as well.
 
 
6. Regional Integration
 
The entire GDP of Philippines or even Singapore is about one-fourth that of Paris or Dallas-Fort Worth. Despite their fast economic growth, countries in Southeast Asia are still small and need to work together to be noticed in a global environment. 
 
Rather than employ Country Managers for single countries, more companies assign managers to handle multiple countries in a hands-on operating capacity. Dividing time among 2 or 4 countries gives an adequate return to the employer and a more significant opportunity to the manager. The only downside is extra wear-and-tear on managers due to increased travel requirements.
 
 
7. Head Office Relocation
 
Beginners to Asia, generally choose to locate regional offices in the established commercial centers of Singapore and Hong Kong where work environments and lifestyles are similar to world standards. Companies with regional management teams who are more experienced in the region are becoming transferring themselves and their operations to cities like Kuala Lumpur, Bangkok and Manila that are less developed. 
 
Cost savings is one important reason behind the move since a correctly executed relocation can easily save half the operating costs of running a regional head office. 
 
Another more strategic reason behind the trend has to do with economic growth. It is reasonable to say that the bulk of the opportunities in Asia are in countries where the bulk of the population lives. Relocating a head office puts senior staff in better touch with prospects as they unfold. 
 
 
8. Asia Becoming Valued
 
For most multinational companies, Asia currently accounts for less than 15% of total revenues but a disproportionate share of its growth.
 
Most global managers see slower growth ahead in so-called advanced economies. Countries in Asia were taught tough lessons about fiscal prudence during the Asian Crisis of the late 1990's and are now poised for strong sustainable growth in the coming years. This has not escaped the notice of multinational companies and Asia will be a focus for future investment.
 
 
9. Rise of Asian Multinationals
 
Companies in Asia are comparatively cash rich. As a result, they are in a better position to expand their operations as some hard-hit multinationals pull-back or sell operations. 
 
Asian companies that in the past may have invested their funds in the west, today feel there are better opportunities closer to home. The result is that Asian companies are becoming realistic career opportunities for experienced international managers. 
 
 

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Media organizations throughout the world call upon the Principals of Chalre Associates for thought leadership.  Below are some examples of published material written by our consultants or international journalists who refer to them.  For a complete list of published work, Click Here.  

 

 

Getting Ready For The Deluge: Outsourcing in Philippines

by Chalre Associates senior staff

 

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The Economist Intelligence Unit of the Economist magazine asked Chalre Associates' Chairman, Richard Mills, to write a chapter about the Philippine outsourcing sector in its annual Business Guide Book.  The material provides a Executive Briefing on the progress and major issues facing this industry that is certainly one of most significant growth stories in the world.  more

 

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Asia Pacific Mining Conference 2007 - Report

by Chalre Associates senior staff

 

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The 7th Asia Pacific Mining Conference put on by the Asean Federation of Mining Associations was perhaps the largest such event in the region.  Richard Mills, Chairman of Chalre Associates gave this report on what was said by the prominent mining people who presented. more

 

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The State of BPO in Philippines: Dan Reyes Speaks

by Chalre Associates senior staff

 

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Richard Mills, Chairman of Chalre Associates, interviewed Dan Reyes of Sitel for ComputerWorld (US) recently to get his views on the state of the BPO industry in Philippines. Dan presented US readers with compelling information to support his view that Philippines is currently seen as the "Number 1" option by global companies sending BPO work to offshore destinations. 
 
Dan Reyes is easily one of most experienced Business Process Outsourcing (BPO) managers in the Asia Pacific region and the world. He is head of the extremely successful Philippine operations of Sitel, the world's largest call center organization. Among other things, he is a founder and former president of the Business Processing Association of the Philippines.    more