Am talking about the prices of gasoline and lpg, power cost and food prices. Thanks to the oil cartel and fuel hungry developed nations.
An Ethanol Unleaded gasoline (the one I use) now cost US $1.25 (Php 49-50.00) per liter. My elecric bill went up from $75 (Php 3000.00) to $125 (Php 5000.00), courtesy of the power rates increase as well as increase usage of air-con due to the summer heat. These costs, on accounting point of view, are controllable expenses, so wifey and myself have made some cost saving measures.
With these, as the gov’t worries about the inflation and laborers demand for higher wages, corporations on the other hand, do their management accounting study to understand it’s operating expenses, including manpower cost.
At the minimum, operations is expected to breakeven. But a business will not be business unless it generates income. In times like this, it is only expected that management will require not only efficiency of operations, but to maximize productivity of it’s assets and resources as well.
The human resource, can be an asset or liability of an organization. Good human resource management will result to employee satisfaction and loyalty. On the other hand, bad management will result to high turn-over rate (normally of the good ones) while those left behind can affect operational lapses brought about by dissatisfaction, bad corporate image brought about by customer complaints, defective products, and high operational expense due to error, machine malfunction or facilities that are not properly attended to.
How do we address this?
Contrary to the belief, a high salary is not the answer. Look at the call center industry, they pay exceptionally high wages but their turn-over rate is still high. Managing people is about meeting their human needs, yes money is one motivation. But there are other needs that are of equal importance like social, safety and security, developmental, etc.
While I am not advocating for unreasonably high budget allocation for manpower, it should not be viewed as cost, rather an investment. Because a satisfied, skilled and loyal employee is cheaper compared with the cost of hiring and training a new one.
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