Rosti Malaysia has attained the Platinum Award issued by the Responsible Business Alliance
Rosti Malaysia has attained the Platinum Award issued by the Responsible Business Alliance and in a series of conversations with the line managers at the Johor based plant, there are some lessons that can be shared with the industry and others running extensive operations in the b2b sector in Asia. Communications, discipline, customer-centric, employee engagement and respect for different cultures all form a culture of excellence that support the technical aspects of the business which provides plastic moulding and outsourcing services to global clients drawn from healthcare to consumer goods.
Rosti Malaysia is a business with 90 staff, a facility size of 5,000m², and operates 21 injection moulding machines. Having attained ISO9001, 14001, 45001 and UL Certification, the Responsible Business Alliance Platinum Award has been considered one of the toughest to attain. The Alliance covers a stringent Code of Conduct ‘which may be voluntarily adopted in any business in the electronics sector and subsequently applied by that business to its supply chain and subcontractors including providers of contract labour.’ Founded in 2004, the RBA is a non-profit organization run by the supply chain industry for the greater good of workers and communities worldwide. The Audit covers a number of facets of the business including: labour welfare, health and safety, environment, ethics, management systems and company commitment to continuous improvement.
Central to the implementation was the workers started to see the benefits of using and abiding with the RBA principles. With efficient communication and training, Rosti started to get the 90 staff on board to understand the benefits of the RBA. The message was clear: Rosti respects everyone’s opinion and the workers were the assets of the company. However, changes had to be made. Yap Wai Luen, Production Manager at Rosti Malaysia is in charge of the moulding section, assembly lines, tooling and Quality Control.
“When we started to implement the RBA instructions, the workers started to ask, why they had to follow so many rules and regulations. They would say why don’t we just do like we were doing and follow what other manufacturing companies in Malaysia are doing? However, when the employees found out that the RBA is not only for the Company, but is actually for their benefit, teamwork became an essential element. This contributed to the success.”
In normal circumstances, employees are reluctant to share their views, especially in Asia to a foreign management team. The introduction of ‘coffee talks’ and town hall meetings helped the employees tell their story’s side. The informal sessions resulted in the time spent on some specific tasks being reduced, boosting the ability of the workforce to earn more income, which changed the attitude towards an inclusive dialogue.
Yeo See Joo, the regional sales director at Rosti Malaysia and Southeast Asia, runs the department responsible for seeking new clients for the Rosti facility from Asia and outside of the region. The ‘Quotation Team’ ensures that Rosti is competitive on price, but also respects the client’s timeframe, by working closely with the suppliers to Rosti as well as the internal teams to pre-plan delivery times before the client comes on board. The aim is to align the customer’s needs and specifications for production with the capabilities within the facility to guarantee price and delivery on time.
“We have the quarterly or yearly customer survey to ensure that we know them better. The exercise will also get the clients to know more about us. And this is a two-way win-win situation for both Rosti and the customers. Here, our key elements is customer intimacy. In reality, customers do not care how much you know. They think differently when they know how much you care about them,” he says.
Compliance runs across the whole operation, covering both internal departments and incorporating the external supply chain to ensure consistency of quality. Central to the attainment of the RBA Platinum is the management of these external parties as they can impact the quality and ability of Rosti to deliver to clients. Especially during the COVID lockdown, there was great disruption in the entire supply chain, and yet Rosti was committed to managing this so that any disruption would be minimised to their clients.
Tan Siew Bee, Supply Chain Manager at Rosti Malaysia, takes care of customer service planning, purchasing and warehouse logistic. “When the suppliers comply to our requests for a specific type of material or products, this directly impacts our ability to deliver Rosti customer satisfaction,” she says.
During COVID there were travel restrictions for foreign workers, and Malaysian staff at Rosti were asked to work upto a maximum of 60 hours per week, but targets were set at 40 hours per week to ensure labour regulation compliance.
“Now, my staff is working for about eight hours, five days a week. Which means that we are working efficiently and effectively and safeguarding the health of our workers.”
Rosti faced the COVID-19 pandemic head-on but pursued the RBA audit which took place at a time of organisational change and required additional investigation of how Rosti operated including a test of water supplies. As a result of COVID, some workers had to take the Voluntary Separation Scheme (VSS), but the staff who remained worked as a team to ensure the Company continued to perform at the highest levels to deliver to clients. The key to the successful implementation was the application of labour practices in which workers had to put in fewer working hours but were still earning better wages through the key performance indexes.
Rozaidi B Mahfodz, Health Safety Executive and Engineering department manager at Rosti Malaysia, said, “We performed an audit of the departments to look at the efficiencies we could gain to compensate for the headcount reduction, without increasing the hours of the people who would be impacted.
Compared to ISO audits the Responsible Business Alliance process was more stringent. Included in the process was water testing. Rozaidi says he had to work with a third party, a lab, to get the samples examined, and the results of the tests showed the drinking water to be safe for the workers. In addition, drainage water was tested to make sure no tainted water enters the premises at Rosti or the surrounding groundwater.
As a result of some of the best practices of the RBA, the Rosti finance department learnt how to improve their internal processes. Prior to the audit, the finance team would send the statements to the clients to chase for the payment once a month, but post-audit invoices are sent every two weeks. This way, they inform the customers of impending balances and upcoming payments which improves cash flow, but also helps clients to feel more connected with Rosti as partners, not just suppliers.
Chan Mei Ting, finance Manager at Rosti Malaysia, who in charge of the finance department, said, “the finance department provides ‘back-end’ support to the sales and marketing divisions. We provide help to assess risks and benefits to customers too, explaining the impact of cash flow to allow Rosti to offer the most competitive pricing in the market which is beneficial to all parties in our relationship.”
During the COVID lockdown, the whole Rosti company adopted a mindset of continuous improvement. They introduced a new approach with an intensive responsible labour initiative under the Six Sigma program, and the respective teams were asked to come up with the Kaizen program to help reduce the number of people required for each task and also to find ways to ‘recycle’ the time used in the production line.
A central component of the Responsible Business Alliance audit relates to worker welfare. At Rosti Malaysia, effective workers training programme and a sound development plan represent a major contributing factor in the Company’s success. There are the four core values the Company adheres to in each of the 8 plants around the world: passion, integrity, partnership, and excellence. In the Asian context, what has also been instrumental in the Platinum Award is the element of inclusion and respect for other cultures.
“At Rosti, we treat all the workers on the same level. Be they foreign or local. We used to have foreign workers before the pandemic, and we treat everyone the same way. This is the added bonus that helped us win,” says Jasline Lee HR Department Manager at Rosti Malaysia. “Success comes by caring for the workers, communicating with them and giving them the right tools and framework and support to progress. This is The Rosti Way.”