April 2023

Can I Trust The Outsourcing Strangers Handling My Salary Data?

By Fariz Abdullah, CEO

It’s quite common these days for our data to be tucked up in the cloud, alongside our photos, children’s birthday videos, payslips, tax returns, pension details, renovation bills etc. But did you know that they are all at risk of disappearing with just the snap of a finger? If and when they do, what would you do? Is there a copy somewhere for you to salvage from?

Backing up data incidentally comes under the ambit of a wide range of standards, from data protection, best practices, cyber security to part of the Disaster Recovery Plan. The rationale behind this is that when data processing happens on an ordinary day, information will move from the source to be processed before it is sent somewhere to be stored.

But wherever the data ends up at, they are susceptible to hacking and data theft. This is probably why when we talk about payroll outsourcing, employees and HR practitioners alike tend to ask, “Is my salary data safe when it is outsourced to a third party?”

Without sidelining the fear factor, let’s look at some data breach incidents:

In 2017, the Equifax data breach in the US exposed personal information of 143 million Americans. Legal recourse then provided the claimants up to US$700 million in compensation (source: (source: https://money.cnn.com, https://cnn.com);
In 2019, the American Medical Collection Agency (AMCA) suffered a data breach, compromising personal and financial information of nearly 20 million patients. AMCA later filed for bankruptcy protection (source: https://www.zdnet.com) and subsequently ruled by the Attorney General for a US$21 million liability (source: https://www.attorneygeneral.gov);
In 2020, the University of California paid a $1.14 million ransom to regain access to its data after a ransomware attack (source: https://www.forbes.com); and
From a news report on 18 September 2022, e-payslips of civil servants in Malaysia were alleged to have suffered from data theft (source: https://www.nst.com.my).

But what’s the rationale to protect such information?

Thirdly, all hell may break loose when salary information of a certain individual(s) is leaked. This may inadvertently generate ill feelings, animosity,jealousy among colleagues and could also turn up the political heat in the office, risking resignations en-masse.

With payroll outsourcing enjoying an escalation of interest globally, in part due to the rising awareness for HR to move out of the back office to play a more strategic role, and another attributed to the increasingly complex practice of payroll, it makes sense for companies to begin understanding the critical factors that make up a good and ideal outsourcing partner.

In no particular order, companies can use the following to evaluate a potential payroll outsourcing vendor:

Treatment of Sensitive vs Non-Sensitive Data – is the vendor well versed with what’s inside the system and which kind of data is considered sensitive?
Operating System vs Application – what safety measures are in place at the different layers of the system?
Digital vs Analogue – we know about firewalls, encryption and anti-virus but what about the safety net for analogue data?
Users Access vs Client Accounts – what’s the rule that governs user access to client accounts?
Processing vs Approval – is there any protocol to handle such processes?
Ordinary Day vs Red Alert – quite simply, can the system continue to run in the event of a disaster like flood, fire or a pandemic?
Upkeep vs Update – it’s easy when we talk about maintaining the daily tasks but what about the periodic updates, how are these managed?

Taking a page from the panic stricken 2020 and 2021, and thanks to our Disaster Recovery Plan, we knew exactly what to do when the roads and offices were off limits. We also knew which of our staff should come under the Essential Services category so they can walk into the office to process payroll for our clients and which can securely dial in through our pre-designated VPN by working from home.

Coming back to the question, “Is my salary data safe when it is outsourced to a third party?”

On the technical end, our Tier 3 (highest in Malaysia) bank-grade data centre stands as one of our strong pillars that spells confidence. It is fully certified for its safety credentials by international compliance standards like the Uptime Institute Tier III Certification of Constructed Facility & Design Documents; Threat, Vulnerability and Risk Assessment; Data Centre Risk Assessment (DCRA); Payment Card Industry Data Security Standard (PCI DSS) and ISO certifications for ISO/IEC 27001 Information Security Management System, ISO/IEC 20000-1 IT Service Management System and ISO 9001 Quality Management System. They are the reason why we pass the audit and penetration tests regularly, including those requested by our MNC clients. Going a step further, we also share our test results with our clients so they know how we’re performing from time to time.

But beyond the cold rooms and elevated floors of the data centres, one of the most commonly cited factors for data leakage is human errors. This includes passwords on sticky notes, sharing of passwords, absence of a password change schedule, placement of sensitive files and so on. When systems are also built with a single entry point without any perimeter fencing consideration, it raises the risk of having the data being tampered with.

In this sense, it is worth noting that as a fellow service provider in the market, we abide strictly to data security & protection as stipulated in our SLA and NDA, this includes safeguarding your payroll secrets with as minimal human intervention as possible, sometimes limited to only one or two personnel from our office to process north of 500 or even 1,000 payroll data and over multiple payroll cycles too.

About Fariz

Fariz Abdullah is the Chief Executive Officer (CEO) of CXL Group. The organisation offers HR solutions which include Contingent Workforce, Executive Search and Payroll & HR Outsourcing. Under his purview, Fariz has transformed CXL Group into an HR organisation that believes in the importance of advancing through technology but with a deep focus on the human touch in an increasingly digital era.

Talent On Tap: How A Contingent Workforce Can Help Your Business Scale

By Erin Sequerah, Head of Contingent Workforce

With the rise of the contingent workforce today, organisations are able to widen the talent pool they access. We understand how important it is to scale at just the right pace and to adjust according to needs. In other words, we get it— an agile workforce is what makes businesses function at their full potential.

Recently a client of ours a leading professional service provider required a contingent workforce for a new project. They had exactly 10 days to kick start the project and the challenge was finding qualified candidates, interviews, onboarding and developing a standardized contract.

Our CXL contingent workforce team went to work and minimised the risk for their business as all other aspects, including hiring, onboarding, compliance, and payroll were handled by our experienced team of consultants. Our solutions allowed their business to scale when needed with temporary or contract staff. Their existing employees appreciated the added support, and the team was able to function at their full potential to meet current work demands.

The benefits of a contingent workforce are numerous. For businesses, it offers a cost-effective solution to staffing needs, as they only pay for the work that is required, without the additional overheads of salaries, benefits, and other expenses associated with permanent staff. The contingent workforce is also highly skilled and specialized, providing businesses with access to a range of talent that they may not have been able to afford or find otherwise.

For workers, the contingent workforce provides flexibility, autonomy, and the opportunity to work on projects that are of interest to them. They have the freedom to choose when and where they work, and they can often negotiate their own rates and terms of employment. This enables them to take control of their careers and achieve a better work-life balance.

The contingent workforce is an essential component of today’s modern workplace. It offers businesses the flexibility and agility they need to remain competitive, while providing workers with greater autonomy and control over their careers. However, it is important to manage this workforce effectively, to ensure that quality standards are maintained, and compliance with labor laws and regulations is met.

At CXL, we help fill employment gaps in your workforce with minimal risk and barriers through temporary and contract staffing solutions customised according to your business needs.

How To Manifest Your Organisation’s Core Values to Become Its Culture

According to Indeed, work culture is a collection of attitudes, beliefs and behaviors that make up the regular atmosphere in a work environment. Work culture will undoubtedly impact our lives as we spend most of our waking hours at the workplace. Even more so in a hybrid work arrangement where having a good work culture may be even more challenging to achieve but all the more important.

At CXL we believe developing a strong company culture can help to create a positive work environment, improve employee morale and productivity, and ultimately contribute to the success of a business. One way to establish a cohesive culture is by identifying and promoting core values that align with the company’s mission and goals.

Why Good Work Culture is Vital

When an organisation has a positive work culture, it speaks volumes in every area of business. Based on research by McKinsey & Company with over 3 million individuals across 1,000 organisations, shareholders from organisations with good work culture receive far higher returns— 60 percent higher than median companies and 200 percent higher than those in the bottom quartile.

Good work culture also becomes contagious; employees tend to exude positive vibes when speaking to their peers outside of the office. Ding! Wouldn’t that improve hiring choices and likely improve retention rates? The catalyst to great employee branding in our books.

A great way to start would be by going back to basics with the organisation’s core values. Just as it is intended to do, a set of core values that define the organisation’s beliefs act as a perfect guide to steer the organisation in the right direction towards establishing a great company culture. Here are our top ten attributes that make great company culture:

Diversity
Accountability
Collaboration
Compassion
Determination
Happiness
Honesty
Participation
Respect
Transparency

Steps to turn core values into a culture

Leadership must walk the talk

Let’s use diversity as an example to demonstrate how a core value can make a difference. Top management must enforce this belief from its hiring decisions to the images used in its marketing campaigns. Ensure a balance between genders, cultures, backgrounds and beyond when shortlisting candidates. For marketing collaterals, use images which represent diversity. By doing so, middle management can identify with elements of how diversity can be implanted in their team. This belief is likely to cascade down to the rest of the company in more ways than one.

Communicate

While action speaks louder than words, communicating with employees with words is equally important.

The periodic get-together during Town Hall meetings or team meetings is an excellent opportunity for friendly reminders about the organisation’s core values.
Visual aids might do the trick as well. Have well-designed posters of the core values placed in key locations in the office. Encourage those on hybrid or remote work arrangements to use the poster as a digital background or screen saver.
Start early and speak to candidates about your core values during the hiring process. This would be a great way to hire the right candidate with common values with the organisation.

Recognise achievements

There is no better way to demonstrate appreciation for best practices or achievements than the good old reward system. Get creative and create unique awards that represent your unique company culture, workplace and team members. Don’t just reward based on numbers and KPIs, but perhaps consider these too,

– Happiest team member

– The most dependable employee

– The employee with a heart of gold

These light-hearted rewards create a collaborative space for employees to bond and get to know each other better.

At CXL we recognise that shaping company culture takes time & that taking a step towards achieving it is already a milestone checked. Doing so has no negative repercussions, only positive ones that will make a big difference in many areas of our organisation. For the past two decades we have ensured that our culture is strongly embedded in our team which in turn allows them to explore their interest to bring their career to the next level. Our team is our story and we strive to create a brand culture that resonates with everyone.

Source:

– Culture: 4 keys to why it matters by Carolyn Dewar

– Guide to Company Culture by Jennifer Herrity

CXL Group merged with Whyze Solutions

CXL Group, a Malaysian based HR solutions outsourcing firm has merged with Whyze Solutions, a Singapore based HR & Payroll platform provider.

CXL’s humble beginnings started in year 2008 as CareerXcell, focusing on training and placing unemployed graduates to help reduce unemployment rates in the country and ensure graduates are better equipped to join the workforce. Over the years, the company’s growth led to establishing the contingent workforce division in 2010 to support the rising demand of the gig economy in Malaysia. In 2021 CXL Group merged with Ability Center from Japan a leading HR service provider in Shikoku region of Japan.

Whyze currently supports over 2,000 companies in Singapore from various industries ranging from new startups, local SMEs, non profit organizations to MNCs. They have since received many awards for their excellent solutions and has consistently achieved extremely high customer satisfaction rating.

Karrie Cheung, CEO of Whyze Solutions is thrilled to be part of Ability Centre Group. “Our combined experience has tremendous potential. We are excited to work together to expand our solution offerings in APAC. This will allow our team to scale our services and provide more value to clients.”

Fariz Abdullah, CEO of CXL Group commented: “For a long time, we were looking into merging with a platform that aligns with our strategic vision of providing better service to our clients, and to grow with us. The post-pandemic tech world is becoming more complex and dynamic. The opportunity to create competitive advantage and value, while ensuring sustainability, through digital transformation is more compelling than ever. We knew this merger is a perfect fit.”

For more information on Ability Centre, CXL Group and Whyze Solutions.

Resolving Employment Conundrum

To recap from where we left off in Part 1, job profiles tend to be the same pre- and post-Covid-19 geographically. What that means is that Klang Valley’s concentration of shared services like finance, HR, marketing and customer service are still some of the more popular jobs in the capital city and as such, it is where the talents tend to congregate the most.

In Penang, the job market sees engineers of all genres residing there to fill the readily available roles in the manufacturing plants (like the semiconductor industry) and no different are the talents in Johor where they are also inclined towards manufacturing but with an extension to the heavy industries.

But while the all-season job profiles may stand as somewhat stereotypical, hiring managers are now hard pressed to spot the right talents due the way jobs are looked at.

Jarvis, where are the talents?

To cite the tech sector as an example, it is normal for a techie to receive job opportunities on a daily basis, some receiving up to a whopping 45 phone calls a day. Such a high demand is nothing new because not all tech talents are easily lured by just Ringgit and cents. Parameters they scrutinise include the kind of technology they will be exposed to, the profile of the projects, the reputation of the company and the level of flexibility granted when hired. Interestingly, the conventionally more rigid finance-related candidates are also evaluating jobs this way as we speak.

As a reference, a heavy industries client in Negeri Sembilan failed to secure a Business Analyst after more than months of searching. Then came this candidate who was willing to take on the challenge and relocate to the state. But what runs through the veins of the techies must have cut across the tech populace because after only two months, this foreign talent resigned and went looking for more “freedom” ie. to work from wherever he pleases instead of clocking in daily at the office.

In what ways then can candidates prepare themselves so they can stay at a job longer and build an edge over other talents?

Firstly, they should be mindful that companies are looking at their hires in three broad categories:

Entry – candidates are hired for their knowledge and attitude because everything else can be trained;
Middle – the important thing here is skills or skills set because they are required to train the juniors; and
Top – this is about hiring the top management to drive the company’s purpose, value and culture. Candidates in this category must already be a competent lot.

Secondly, they may choose to use social media platforms like LinkedIn to reach companies they aim to work for. It can be a good way to connect with the employers before the full scale of the recruitment process is underway.

Candidates in Malaysia can also identify with the prevalent hot jobs that are available in their cities (see Insights into Malaysia’s Pulsating Job Market). This could help reduce the gap in landing a job.

But does that mean a marketing candidate would not be sought after in places like Penang and Johor?

No, such jobs do exist, the only requirement is for them to relocate.

As fortune favours the bold, relocation may not be a bad thing because some companies are more eager to offer a better package to attract talents. In fact, Penang companies are at times willing to compensate shared services talents with a relocation allowance, not forgetting the competitive salaries rivalling those in Klang Valley.

Further, because candidates have also begun altering their employment demands, companies must be sensitive to such changes and fine tune their search process. The importance of identifying this early can save a company from long drawn ramifications because as the talents prefer to strive for “balance” these days, so must the company’s job specifications in adapting and this is where hiring managers must be adept to redesign jobs.

For example, if a hiring manager finds no qualified candidates coming through after two or three months of advertising the vacancy, he or she must consult the hiring superior on whether the job scope can be dissected into smaller parts. Under such circumstances, it shouldn’t surprise if the job is eventually split into “Job A” fitting a permanent hire and “Job B” contracted to a freelancer.

Vacancies kept open too long may also warrant the question if the job is still presently required. This is how dynamic the hiring market has been in recent years and it is likely to continue this way into the near future. The role of HR as such is no longer confined to just recruitment but more as a strategic partner to the top management

But some might say, isn’t a talent with adequate experience and qualifications able to fill the role just like anybody else?

Well, an European company did just that when they opened an office in Malaysia. To them, it was a no-brainer to transfer someone from HQ to head the operations here, citing familiarity and culturally-fit as the reasons for the appointment. Unfortunately, this strategy fell flat, not just once but twice.

By the time they terminated the third appointee (an Asean executive), 12 years had gone past and by then, they were more accepting to engage a search firm like CXL.

It is heartening to note that the results from this fourth hire through us were more startling than a fairy tale. From drowning in the red for a dozen years, the company emerged into the black after onboarding this new chief, and while their competitors shrank in market capitalisation during the Covid-19 period, this local head honcho only in his 30’s led a remarkable expansionary momentum. The secret? He was more ready to deploy digital marketing compared to his older predecessors.

His success drove home an important point – unlike how qualifications and experience used to dictate a hire, converting analytics to tangible results has become a new set of barometers that one can measure a talent with. In other words, the job market has shifted, even at the top level of an international company. It is imperative hence that this will cascade down to every level of a company; that’s if these companies are poised to remain relevant in a digitally powered post-pandemic world.