“There is a lot of potential for savings as far as wasting time is concerned.”

Bojan Šćepanović is the director and owner of Menadžment Centar Beograd (MCB), the largest Serbian manager development company. In Serbia, his name has been a synonym for controlling for years. 

He is the publisher of “Controlling magazine”, has organized nine congresses of controllers, and has published 15 books on controlling in Serbian, including “Biblija controllinga” (Controlling Bible). 

Bojan is a controlling and reporting consultant for the most prominent Serbian companies such as NIS, Hemofarm, Telekom Srbija, Carlsberg, etc., and has an incredible passion for controlling.

His latest book, “Izveštaji za menadžment” (Management Reports), is aimed at all professionals, especially controllers who prepare various reports on a daily basis. We asked him a little more about analytics in practice, the Japanese concept of kaizen for greater productivity and efficiency, HR trends, different types of work, working in companies with young people and foreign employees...

You have an in-depth knowledge of controlling and adhere to Swiss standards for graphical data interpretation. How can a human resource managers win their place on the board of directors with good HR analytics?

I do my work in Serbia, as well as in Bosnia and Herzegovina and Macedonia, to a smaller degree. In terms of analytics, there is a tendency for managers to show an increasing interest in analytics. On the other hand, HR analytics remains underdeveloped. In general, HR as a sector is poorly developed, particularly in Serbia.

Allow me to present an interesting piece of data. We are preparing an HR congress in February. I’ve made a selection of panels, which are chosen by HR professionals. Which panels they are interested in, more or less. At least in Serbia, the most popular HR topic is strategic business, the second generational differences, the third on-boarding processes, the fourth issues in training and development, etc. Data analytics comes in at ninth place. The application of artificial intelligence comes 22nd, software somewhere about 16th. And that’s out of 25 panels I’ve offered.

Why do you think that is?

I try to look two or three years ahead into the future. In 2019, I was at a conference in Manchester. The entire conference was focused on software, analytics, employee experience, employee engagement, etc. In 2024, these topics are still not receiving a lot of attention in Serbia.

There are certain trends, but they are not yet recognized as important topics. Given the development of the United Kingdom compared to Serbia, this probably makes sense. We are lagging behind United Kingdom by 5 to 8 years.

Data analytics in HR is garnering more and more interest, very very slowly. It is important to some people in HR, but mostly related to salaries or expenses: the salaries as a percentage of income, how much they have increased compared to the previous period, to the budget, and similar. So we’re talking about baby steps, at least in Serbia.

But foreign companies are coming. In the region, Serbia has the largest influx. Company headquarters are moving further east and out of Slovenia, meaning that this trend is probably coming relatively quickly.

Indeed. But Serbia is being chosen because of low labor costs. Analytics are being considered, but also how much we cost. For the most part, these are investments motivated by low costs of labor. In the automotive industry, this is true for 90% of the cases. Only in the last few years have R&D centers been slowly appearing, as well as companies making more complex products.

Looking from the outside, it seems that Serbia is on the verge of joining the EU, and on the other hand, open to the East in a way unlike any other country in the region. Certain Serbian institutes have also been historically quite important, have they not? And strong foreign companies also bring new concepts. The Japanese revolution that they achieved when they started to compete with the US automobile industry with Kaizen, Genchi Genbutsu and PDCA is well-known. Aren’t Serbian companies at least partly competitive due to the fact that they will be able to adapt these principles as well as agility, and not only due to cheap labor?

That's a good question. In fact, there is a surprising number of Japanese companies in Serbia, for example: Nidec,Toyota, Japan Tobacco, JTI ... I founded the Kaizen Institut (Kaizen Institute) 7 or 8 years ago, when I was a member of the Japan Business Alliance in Serbia. This is quite surprising as we are 8.000 km away from Japan. We are not exactly next-door neighbors.

We are talking about serious investments. The connection is great. I think that it could be a great partnership. The Japanese are slow to decide, but when they do, they cannot be stopped. They have an extremely long-term outlook. Because of that, the potential of Kaizen is enormous. There are huge cultural differences between us and the Japanese. But when talking about Kaizen, there is a lot that can be learned from them and applied in Serbia.

Kaizen originated in Toyota, in the automotive industry. I've been applying it internally in my company for the past eight or nine years. Personally, it's helped me a lot. We are a relatively small consulting company with 20 employees. But Kaizen has helped us double our revenue and reduce our expenses. Everyone working for me keeps track of Value Added and Non Value Added. I'm trying to be Japanese in the part that is applicable to us.

Kaizen does not need to be copied 100%. Japanese culture is different and very specific with many good aspects as well as some that I am not fond of. I dislike the fact that in Japan, all employees work extremely long hours. At 8 or 9 o'clock in the evening, you can still see offices full of people hard at work. At 10 o'clock they finally come out of their offices in suits and head home.

I like to work a lot, but I expect my employees to wrap up for the day at 4 or 5 in the afternoon. Otherwise, I or rather my organization is doing something wrong. But Kaizen as a mindset, a way of working, is definitely applicable.

What have you learned from Toyota?

At the beginning of last December, we published the book Toyotin način or Toyota Way in Serbian. This book has sold 3 million copies worldwide.

Do you also see this as an opportunity for the senior employees to provide mentorship, as is prevalent in Toyota, thus enabling the transfer of know-how, of these Japanese concepts, to younger generations?

" Yes, definitely. In our country, Kaizen continues to be viewed as more of a technical tool. Few are those who see it as a signpost as to where HR should step in to introduce changes."

Toyota is HR, to put it simply, the principles of Kaizen and Kata Coaching can definitely be applied in the field of HR to improve the company. Naturally, it takes some time to implement certain changes in the company in order for the processes to work, particularly as far as Kaizen is concerned.

So far, we have been focusing our discussion more on foreign companies, how they monitor analytics. How is analytics monitored by the best Serbian companies owned by the best entrepreneurs?

In general, analytics is lagging behind business, as it is a relatively young discipline. It became a more serious focus of attention after the war, only around 2003. But due to digitalization and globalization, we sometimes skip a few steps in development. In Serbia, the IT industry is quite advanced. In the past 10 years, we have reached an export level of some 3 to 4 billion EUR.

In the IT industry, HR is again somewhat specific in nature, because there is a huge demand for workers, and little supply. People are simply being showered with money and benefits just to recruit them to companies that are growing 20, 30, 40% a year. On the other hand, we have interesting examples of major factories with 600 employees - and yet, without an HR department.

Serious Serbian entrepreneurs have human resource departments. They are trying to keep up with multinational companies. Atlantic Grupa, Delta Holding, MK Grupa, Medigrupa – these are all very modern and contemporary.

Last year, Eurostat published a survey showing that in the EU, the Dutch work the fewest hours, 32 hours a week, while Greeks work the most. This year, Eurostat data shows that in Serbia and Bosnia and Herzegovina, the hours worked exceed those in Greece and amount to some 42 hours. It sure looks like – the further south you go, the more work is being done. We know what the problem is, ie. productivity, efficiency, and so on. However, has this gap between developed countries and Serbia been closing in recent years?

The further south you go, the more interesting the data. My son posted a similar statistic on LinkedIn. In Serbia, we work long hours, but quite inefficiently. The data is therefore probably accurate. In Kaizen terms, a lot of work being done is of no value.

I believe that in this area, HR analytics and data can be of tremendous assistance. It would be better if we worked 8 or 10 hours a week less, but to increase the productivity by 30, 40 or 50%. I suppose that there is a lot of potential for savings as far as wasting time is concerned.

But is the difference in productivity between the Netherlands and Serbia bigger or smaller today than it was 20 years ago?

Smaller, definitely smaller. The gap is narrowing. We are becoming much more productive. On the other hand, it is inconvenient that we do not have enough money to implement robots and new IT technologies.

What are the trends in new work models: teleworking, hybrid work, etc.? What do you expect in the future? How will the trends develop?

In Serbia, many IT companies are applying these modes of work. As well as companies in other sectors. There are a lot of different dispatching or outsourcing companies that work for the United States from Serbia. One such US company, NCR, employs over 4,000 people in Belgrade. Many companies are moving towards working from home.

My personal opinion is somewhat specific. Maybe I'm old school. I believe that work and home should be separated. Work is one thing, and home is something completely different. I don't want to bring work into my home. I am against working from home.

On the other hand, that is the trend. I think that this will come to a halt and that 15 to 20% of the time in administration, sales, marketing, etc., the workers will be able to work from home or in a hybrid model or similar, but that the majority of the work will require physical presence. Due to sociological reasons. Humans are first and foremost social beings who want to see each other, have coffee together, share some gossip, and so on.

In Slovenia, there was a saying before the pandemic that work is work and socializing is socializing. However, after the pandemic, we realized that “work is socializing” after all, isn't it? 

My wife is from Bosnia. She often mentions this saying: Work is work and socializing is socializing. 

I'm not against working from home, but I think that home is home and that laptops and papers should not be brought into the home.

I don't actually own a laptop. I work on my desktop computer in my office. I'll never have a laptop. I keep having to join Zoom, Teams and the like. But if I have to work, I come to the office. When I’m at home, I turn the work off. However, nowadays, it’s more popular to bring your work home.

In December, an interview was published in Slovenia with a professional from Bosnia and Herzegovina that came to work in Slovenia. He said that in Bosnia and Herzegovina, in order to retain good employees, some companies even serve as partial guarantors for the employees’ private loans for purchasing their homes. In the region, what are the trends in motivating employees, not only financially?

There are a lot of different benefits that are being offered. 

"Telekom Srbija, for example, has 10,000 employees. They have created a website platform, where their employees claim benefits and manage them. Buffet-style. So, the benefits are laid out on the website."

The companies are competing to see which one can come up with new ideas. One is saying, we provide our employees with bananas, oranges... The other, we are giving them oranges and tangerines three times a day, the third, we peel the bananas for our employees so they don’t have to.

Some companies employ a psychotherapist to provide psychological support. If the employees have problems with their partner or child, the psychotherapist provides free assistance. If there is an issue in your home, a leaking faucet or toilet, the company will send a handyman to solve it for you.

There is a bit of cynicism here. The companies almost go as far as to say to the employee: we will solve all the problems you have just so that you stay. And the childcare is there, in other words, so that mom or dad can work from 8 in the morning to 6 in the evening. In some cases, the benefits are leaning towards the absurd.

In doing so, what is being disregarded is the key theory of motivation, Herzberg’s theory from the 1960s, saying that employee retention is primarily due to the work itself, its essence. If they find the work interesting, meaningful, with responsibilities, if there is opportunity for personal growth, then all the other benefits of the banana category or similar are pushed to the side.

"I’ve yet to see a team member motivated because they received two kilograms of peeled bananas within the eight hours at work. But I've seen a lot of people motivated by a good job and a good salary."

So, money and work, or rather work first, money second. I think this is what motivates 80% of employees.

How will the new digital technologies impact human resource management?

This impact will be great, for sure. AI has arrived. Those who lack the know-how to apply AI, will be left behind and forced to take up poorly paid jobs. Similar to someone who at this point does not know how to use a mobile phone, send an SMS or an e-mail. The society is going to become very polarized.

We have to embrace the technology; this also holds true for myself, despite the fact that I am 54 so it’s a bit more difficult. Failing to do so will mean that we lose our jobs, or be forced to work in warehouses or as delivery people. Even in those fields, robots and AI may replace us.

How should HR treat young people, Gen Z? In Slovenia, some are saying that Gen Z is even easier to work with than millennials. Historically speaking, the older generations have always looked at young people with a critical eye. That is why we rather pose the question: what are the advantages the younger generations bring today?

They are much faster. They are very well informed. Willing to take risks. Maybe because they are unaware of all they do not know but believe they do. They take on risks, which in business is often a good thing. I like the fact that they're more direct. When talking to us, the older guys, they dispense with the formalities. I find that appealing. I’m not a fan or formal attitudes.

As far as technology is concerned, there is really no comparison. Some have broad interests, some less so. But many are ready to take on responsibility.

It is normal that young people have their shortcomings. The same was true for us. But we forget what it was like 20, 30, 40 years ago. My children are 28 and 24. And then I tell my daughter, how smart she is at 28 and how stupid I was. I knew nothing about life at that age. She is far better.

I don't think we, as companies, need to adapt to young people to a higher degree. Young generations are as they are, the next one will again be different. It's the way of the world. For example, we were only allowed to watch TV for an hour or two a day, because it was believed that it will ruin your eyesight. Or take tattoos as an example. In my time, people who got tattoos were boxers and the like. Now, having a tattoo is completely normal. But when I see someone fully tattooed, the thought does still cross my mind, what if they’re some kind of a criminal. 

Are there any other HR trends gaining in importance?

"The way I think about employees in general is that loyalty has become very short-lived, like in basketball or football clubs." 

In basketball, for example, there is a team of 12 to 15 people in September. By the end of the season next June, 70% of the team has been changed. New players are being brought in, old ones are leaving. In fact, you end the season with a completely different team. And by next September, the team roster is again new.

Previously, there were people like Dule Savić, who played for Crvena Zvezda for 10 years. Those times are over now. If an athlete stays on the team for a year, that’s excellent, great. In companies, we somehow have to learn to live with this.

It puts pressure on analytics, on HR and data. Because new people keep coming. The most challenging thing is to ensure enough personnel. Serbia is currently experiencing a labor shortage. Of all types. HR is desperately looking for anyone to hire. On a daily basis. They don't have time for analytics.

Because of that, people are coming from other companies. How to integrate them in the workplace?

We should not wait for issues to arise but rather work proactively. So, be well informed about the workers’ country of origin, about their culture, religion, nationality, language, understanding of time, way of dressing... Anyone working in the HR needs to understand at least a little bit of the workers’ culture before they arrive. That's the only way they can provide assistance.

Naturally, it is necessary to properly integrate the workers into the local culture and explain to them the culture of the host country, lest they end up in a ghetto, as happened to me in Belgium in Brussels 10 years ago. I had a seminar in the city center, but we were located five kilometers away, so I found myself in a Turkish-Arab ghetto. I felt very uncomfortable. I didn't see a single white person.

That is why foreign workers need to learn the language of the country they work in so that they can feel at home. We also need to work with our people so that they are able to understand this other culture. They have their own habits. I'm not saying these are either good or bad. But they are different from our own. What is important is that we get along.

That's what’s truly important, isn't it?

Here's what happened to me. In Belgrade, I’m used to crossing the road outside of zebra crossings. It’s something I simply don’t pay attention to. Some time ago, I visited Subotica. The traffic light was red, without a car in sight. I wanted to cross the road. But all the other pedestrians were standing there, waiting for the light to turn green. I look around, the street is short, not even 10m. Not a single car to be seen.

But no, they follow the rules, with German-like precision, so to say. So I’ve crossed the road like I’m used to in Subotica for a couple of times, but then I realized that I’m the exception and that I have to adapt to the majority. Because I was getting looks. Everyone found it strange that I was crossing the road outside of a crossing.

That's why it's important for HR to look ahead and not wait and later complain that some foreigners maybe eat from a shared plate, but to help them to integrate into our society. To make it easier for them to accept the culture of the majority, but retain their own.