On February 15, a leading company in human resource (HR) consulting and outsourcing firm Aon Hewitt held an awarding ceremony and conference regarding BEK 2013 in hotel The Ritz Carlton, Seoul. With many chief executive officers (CEOs), HR managers, experts, and reporters in attendance, it rewarded the best employers in Korea.

Since 2001, Aon Hewitt has been conducting the Best Employers study in Asia-Pacific Economic Cooperation (APEC) area every other year with three goals: to provide insights on the alignment between HR management and business performance, to measure the effectiveness of HR systems in various organizations, and to identify the best employers in specific areas. BEK not only lets employers to diagnose its HR system, but also provides employees with an opportunity to speak out about how they think and feel as members of a company––in other words, BEK is means of communication between employers and employees.

Still, this useful and valuable information and list of employers were not well- known to future potential employees; university students. In order to keep Korea University (KU) students informed with exclusive information from BEK studies, GT signed a memorandum of understanding (MOU) with Aon Hewitt last July. Refer to Chart 1 for it is the list of feature articles from September 2012 to March 2013.

Aon Hewitt tries to reflect opinions from all members of one organization, starting from CEOs to entry-level employees. It gathers data and information by four means; questionnaires for CEOs, CEO interviews, Employee Opinion Survey (EOS), and People Practices Inventory (PPI), which is a data gathering tool that collects information on overall business performance, management and policies. Size of samples is dependent on number of employees following a random sampling guide suggested by Aon Hewitt. “In 2013, companies below a certain size will receive a complete enumeration survey when gathering employees’ opinions. If a company bigger than this standard size wants a complete survey, a sample size up to 10,000 is possible. Measurement will be more elaborated to show a clear distinction between the best and Participant Average. CEO interviews will be added also. This detail-oriented research will give us more detailed report and better sources for key findings,” said Shin Sungpil, Practice Leader of Aon Hewitt, during an interview with GT last year. With the data and figures gathered from its unique measuring tools, independent judges select the list of best employers through a blind test. When the list is determined, it carries on further analysis on what makes a best employer the best.

Mainly, three criteria of the following are used to select the best employers: Best Employer 2.0 Themes, Talent Management Effectiveness, and Business Performance & HR Effectiveness. Best Employer 2.0 Themes was of the greatest importance by 50 percent. It is an index based on employees’ opinions rating the four common characteristics of the best employers (Engagement, Employer Brand, Leadership, and Performance Driven Culture) for the last 12 years. “Best employers all shared these four characteristics at a high level. Especially, in the case of engagement, best employers had a well-aligned system between CEO, HR managers, and employees, which can also be evidence of how much Aon Hewitt’s research is scientific,” said Choi Jong Tae (CEO & Vice Chairman, POSCO Research Institute), the foreman of the jury.

Compared to last year, there were three special recognition awards (refer to Chart 2). Best Employer 2.0 themes from each demographic specimen from firms were used to select the best employers for women and Generation Y. Best employer for commitment to engagement was the company or organization which showed the most progress in terms of engagement from 2009, 2011, and until 2013. Through these special awards, it is possible to infer that women and Generation Y are the core issues in the HR management field. Chae Eun Mi (Managing Director, FedEx Korea) pointed out, “Generation Y has a different philosophy of life from the existing generations. How to engage the employees from this generation and make them share their talent within the organization is a great issue for my company.”

Most importantly, BEK 2013 proved Aon Hewitt’s basic assumption to be true; companies with high employee engagement rate will show better performance in profit or revenue growth. Best Employers in 2013 showed higher average growth in revenue than the participant average (refer to Graph 1).

According to Aon Hewitt’s definition, engagement is “the state of emotional and intellectual commitment to an organization that motivates employees to do their best work,” or “the extent to which an organization wins the hearts and minds of its employees.” Even though Participant Average of engagement scores increased steadily from 2003 to 2013, it still showed the biggest gap between the best and Participant Average (refer to Graph 2).

The second biggest gap appeared in Employer Brand. Especially, the best employers had a higher credibility index than Participant Average, which means that they keep their promises with their employees, giving trust (refer to Graph 3). This can also be related to the degree of alignment between CEO, HR department, and employee. If a company’s CEO has a more effective leadership, the more trust a company will get from their employees. Best Employers in Korea this year were doing quite a good job on operating businesses in a people-focused way. This led them to have a big gap in the people focus index (refer to Graph 4). Yet, more effort is required for the CEO and senior leaders to deliver their earnestness to the employees since the difference is big (refer to Chart 3).

Last but not least, best employers all had a high performance culture. Employees knew how to contribute to realize a company’s business strategy and they were willing to take responsibility for it. Also, recognition and rewards were given in a clear and transparent way regarding performance, even though more creative recognition solutions were demanded. Chae mentioned, “Employees now want more than what we have. The company has to develop more creative systems and programs to satisfy and move employees.” The most difficult part seems to be giving growth opportunities to the employees, particularly for the companies of Participant Average (refer to Graph 5). Lee Hee Sung, country manager of Intel Korea, said, “As the company got bigger, the number of employees who failed promotion and left as an individual contributor increased. Developing their new career path and letting them adapt to Intel’s corporate culture is a new challenge for Intel Korea.” One solution for this can be equipping middle management more effectively. Kim Dong Cheol, executive director of Aon Hewitt, mentioned, “Suggesting new challenges and learning opportunities are challengeable. Here, middle managers’ roles may be significant to settle high performance culture.”

BEK 2013 analyzed demographic gaps regarding engagement scores. One interesting thing is that Generation Y employees who were born between 1979 and 1990 had the lowest engagement scores, 19 percent lower than Baby Boomers and 4 percent lower than Generation X (refer to Graph 6). Engagement impact drivers were also different from participant average. Generation Y wanted improved performance management. They also demanded more career opportunities and innovation (refer to Chart 4).

Among the social characteristics GT mentioned in the September issue of 2012, Generation Y having a strong sense of self and being learning-oriented is the most remarkable feature regarding BEK 2013. These characteristics developed into specific traits in working environment; valuing payment that reflects one’s achievements and opportunity to foster their career path and to learn. Shin Yeon Soo (’10, Business Administration) said, “I hope the company gives us one moment to breathe. Also, I hope it pays attention to new employees’ voices, making a corporate culture of sharing opinions regardless of rank or positions.”

This can be again found in the survey that GT conducted during November and December 2012 with KU students (sample size: 1,000 / return rate: 95.8 percent). Through Graph 7, it is certain that Generation Y wants a company to be performance-oriented (average 4.5 out of 6). Not only did they want tangible rewards, but also they wanted emotional rewards and feedback from senior managers. This is a good example of Generation Y having a strong sense of self. In Graph 8, Generation Y’s desire for education and learning in the workplace is shown. With the average being 4.74 out of 6, nearly 90 percent of respondents wanted the company to give forth effort to help employees realize career aspirations and develop them professionally by higher or equal to 4. In other words, Generation Y is demanding a workplace that values people.

Then, are Korean companies well following this trend? At least they are on the average. Looking at Graph 9, Generation Y thinks Korean companies are reflecting their requirements and are on their way to change by an average of 3.89 out of 6. In more depth, students from the Science and Engineering campus seem to be less satisfied with Korean companies’ efforts.

From 2014, Aon Hewitt is planning to carry on this BEK study annually. BEK study is remarkable in that it lets employer and employees communicate and leads HR-related changes for a better workplace. Still, it may be more of a help when its information is shared with the public. Kim Kyuyeon (’11, Japanese Language and Literature) said, “The information we need is not just who the best employers are. We want to know why and how it provides the best working environment.” Valuable information and resources are bound to be spread and shared. There is no doubt that BEK 2.0 will continue for a better working environment for all.