Huawei's human resource management

Author: Wen Liyan
Publisher:
Publish Date: 2006-10-01
Features: It can be said that in many people's eyes, "foreign-invested enterprises" are synonymous with high salaries. As a newcomer in the electronics industry, Samsung not only attracts numerous talents with its philosophy of recruiting geniuses and valuing unconventional talents but also sets a benchmark for talent realization with its challenging salaries. When an employee joins Samsung, the company uses four principles—Position Importance Principle, Social Recognition Principle, Original Salary Comparison Principle, and Value Creation Principle—to determine their salary. After this comprehensive vertical and horizontal evaluation, the salary distribution plan is well-founded and clearly defined, making employees satisfied and without objection. When setting salaries for employees, Samsung first refers to the standard salaries for similar positions in society. For example, take a scholar-type engineer with a senior title and expertise in electrical performance research. Society generally recognizes an annual salary of 150,000 yuan as the "market rate." If the company only offers 120,000 yuan, it is clearly not attractive enough to lure him to travel great distances to join Samsung. Therefore, Samsung's annual salary should at least meet the "bottom line" of 150,000 yuan, which is the Social Recognition Principle. Similarly, if the engineer's compensation is lower than his income at his previous company, it will certainly have no appeal. Thus, while referring to social salary trends, Samsung must also apply the "Original Salary Comparison Principle" to make its salaries more competitive.
"There are many talented individuals in society; the key is whether they are useful to Samsung." Samsung believes that if a talent is urgently needed for a certain position within the company, their introduction can fill a "gap," or if their skills and professional level are sufficient to serve as a key figure in their department, their "position importance" is high and relatively irreplaceable. Therefore, their salary should be higher than that of employees in similar positions.
Regarding the "Value Creation Principle," the head of human resources explains: Some individuals may be highly regarded in the industry and have achieved many accomplishments in the past, but whether they can create corresponding value after joining Samsung is unpredictable. Therefore, human resources conducts performance evaluations and assessments in practice "to wait and see" and provides reasonable salary increases based on the value they create. This not only helps the company avoid making the wrong hires but also gives outstanding employees something to look forward to.
In human resource management, salary determination is one of the most challenging tasks. However, for Samsung, it is not an insurmountable problem. As the head of human resources at Samsung puts it, "The company aims to attract, utilize, and retain talent with good treatment and broad development opportunities."
In addition to fixed salaries, Samsung also implements additional incentive measures to make employees feel that "the best is yet to come." The company that core employees who have worked at Samsung for at least one year are eligible to receive the "Love Award," presented in the name of the group president, to recognize their contributions to the company. The longer an employee serves at Samsung, the more accumulated "Love Awards" they receive. In 2000, the company awarded its highest "Love Award" of 200,000 yuan.
In 2005, Samsung's mobile phone sales reached 86 million units worldwide.