the impact of corporate cultural in vietnamese companies a case study of vietinbank, hoan kiem branch

THE IMPACT OF CORPORATE CULTURAL IN VIETNAMESE COMPANIES: A CASE STUDY OF VIETINBANK, HOAN KIEM BRANCH BY LE VAN QUYNH E0600106 Graduation Project Submitted to the Department of Busine

THE IMPACT OF CORPORATE CULTURAL IN VIETNAMESE COMPANIES: A CASE STUDY OF VIETINBANK, HOAN KIEM BRANCH

BY

LE VAN QUYNH E0600106

Graduation Project Submitted to the Department of Business Studies, HELP University College, in Partial Fulfillment of the Requirements for

The Degree of Bachelor of Business (Accounting) Hons

APRIL 2011

DECLERATION

I hereby declare that the graduation project is based on my original work except for quotations and citations which have been duly acknowledged I also declare that it has not been previously or concurrently submitted for any other course/degree at HELP University College or other institutions The word count is 15,077 words

_

LE VAN QUYNH

Date:

ACKNOWLEDGEMENT

This graduation thesis is the result of thirteen weeks of research and writing during the spring of 2011 It has been an interesting and learning experience In fulfilling this thesis, I would like to give my special thanks to many people for their significant help, contribution, and recommendations during my writing process

First and foremost, special mentions and grate thanks must go to Ms Dao Thi Thu Giang, my supervisor at Hanoi Foreign Trade University With her master knowledge and experience in writing thesis, she has wholeheartedly helped me in writing this thesis I could not have been able to complete this thesis without her positive suggestions and guidance

Secondly, I want to thank all the managers and staffs of VietinBank, Hoan Kiem Branch, for their cooperation that helped and inspired me in writing

Thirdly, I would also like to give my heartfelt thanks to the authors who provided me with valuable books for my thesis

My appreciation is to my family and my friends for their supports and encouragements

Gratefulness is to the readers also, whose feedback will help much in improving the thesis

Hanoi, April 2011

Le Van Quynh

THE IMPACT OF CORPORATE CULTURAL IN VIETNAMESE COMPANIES: A CASE STUDY OF VIETINBANK, HOAN KIEM BRANCH

BY

LE VAN QUYNH APRIL 2011 Supervisor: Ms Dao Thi Thu Giang

Abstract

The graduation project represents the results of research on impact of corporate culture in Vietnamese companies The objectives of the project were to understand impacts of corporate culture in Vietnamese companies which shows the importance of corporate culture Benefits of adopting corporate culture will create a unique style and attitude for each company, creating centripetal force for the entire company, helps companies boost innovation and invention, and attract more customers

In this thesis, the researcher uses case study of VietinBank, Hoan Kiem Branch because this Branch may be given more accurate information and able to take the right actions

TABLE OF CONTENT

Page

DECLERATION ii

ACKNOWLEDGEMENT iii

Abstract iv

TABLE OF CONTENT v

LIST OF ABBREVIATION x

CHAPTER I - INTRODUCTION 1

1.1 Study background 1

1.2 The objectives of study 2

1.3 Research questions 2

1.4 Scope of research 3

1.5 Structure of the thesis 3

CHAPTER II - LITERATURE REVIEW 5

2.1 Overview 5

2.2 Definition of culture and corporate culture 5

2.2.1 Definition of culture 5

2.2.2 Definition of corporate culture 7

2.3 Corporate culture forming factors 9

2.3.1 Key business processes 9

2.3.2 Employees and other tangible assets 9

2.3.3 Formal arrangements 10

2.3.4 Dominant coalition 10

2.3.5 The social system 10

2.3.6 Technology 10

2.3.7 The external environment 11

2.4 The impact of corporate culture on the development of a corporation 11

2.4.1 Creating the unique manner and attitude for each corporate 11

2.4.2 Creating the centripetal force for the whole company 12

2.4.3 Fostering innovation and invention 13

2.4.4 Creating the competitive advantage of the corporation 13

2.4.5 Attracting customers 14

2.5 Level of corporate culture 14

2.5.1 Observable artifacts 17

2.5.2 Espoused beliefs and values 18

2.5.3 Basic underlying assumptions 21

2.6 The role of leader – key factor creating the corporate culture of organization 23

CHAPTER III - RESEARCH METHOLOGY 25

3.1 Overview 25

3.2 Research methodology 25

3.3 Data collection 26

3.4 Sampling 27

CHAPTER IV - RESEARCH ANALYSIS AND RECOMMENDATION 28

4.1 Overview 28

4.2 An overview of Vietinbank, Hoan Kiem Branch 28

4.2.1 Introduction of Vietinbank 28

4.2.2 Overview of Vietinbank, Hoan Kiem Branch 30

4.3 An overview of VietinBank’s corporate culture 32

4.4 Levels and manifestations of corporate culture in VietinBank, Hoan Kiem

Branch 33

4.4.1 Artifact level and its manifestations 34

4.4.1.1 Office’s architecture and decoration 34

4.4.1.2 Brand name, logo, and slogan 36

Source: VietinBank’s website, 2009 36

4.4.1.3 Language and style 38

4.4.1.4 Leadership Style 40

4.4.1.5 Behavior within the branch 41

4.4.1.6 Behavior toward customers 43

4.4.2 Espoused beliefs and values 44

4.4.3 The basic underlying assumption 48

4.5 Some suggestions to VietinBank in general 49

4.5.1 Identifying the right way of development 50

4.5.2 Improving the influence of core values inside and outside the whole system 52

4.6 Some suggestions to VietinBank, Hoan Kiem Branch 53

4.6.1 Leadership style as the decisive element in building and developing corporate culture 53

4.6.2 Building the specific value system 55

4.6.3 Changing the physical working environment 57

4.6.4 Building up a close relationship between customers and branch 58

4.6.4.1 “Customer is King” 58

4.6.4.2 PR and face-to-face communication with customers 61

4.6.5 Learning from other organizations 62

CHAPTER V – CONCLUSION 64

5.1 Conclusion 64 5.2 Limitation of research 65 REFERENCES 66

LIST OF FIGURES AND IMAGES

Chapter 2

Figure 2.3 Corporate culture – iceberg’s principle 16

Chapter 4

Figure 4.1 Organizational structure of VietinBank, Hoan Kiem Branch 31

LIST OF ABBREVIATION

VietinBank Vietnam Joint Stock Commercial Bank for

Industry and Trade Vietin Bank, Hoan Kiem Branch Vietnam Joint Stock Commercial Bank for

Industry and Trade, Hoan Kiem Branch

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

CHAPTER I - INTRODUCTION

1.1 Study background

Recently, “corporate culture” has not been a new expression with organizations and public Many companies have not been afraid of investing in many resources to form and develop their own culture “Make a difference” is a philosophy

in business to improve the image of an organization under the eyes of society, community and clients One of the factors making the difference is the culture values which are shaped, developed, recognized and popularized in many years However, not all organizations can be aware of the concept and connotation of the culture they have

Although corporate culture now is a popular term, there are many ways of understanding leading to different definitions of corporate culture In general, corporate culture can be understood as all the culture values of an organization which are formed during its development period It has great influence on all activities of a company as well as its workers In fact, nowadays, corporate culture is one of the important elements that many job hunters concern when they enquire about a company Besides, a good business environment can become an effective tool to keep those current employees loyal to and dedicated to their organization

Banking is an industry whose success is based on the belief of the clients Hence, forming a unique corporate culture which can make good impression on customers is of greater importance for banks in general and for commercial banks in particular Vietnam Joins Stock Commercial Bank for Industry and Trade – VietinBank is one of the top banks in Vietnam Nowadays, corporate culture is one

of the greatest concern by both the leaders and officers of this bank Therefore, I

chose the topic “The impact of Corporate culture in Vietnamese companies: A Case Study of VietinBank, Hoan Kiem Branch” as graduation thesis topic in the hope that

some findings and recommendations from the study could be a reference to help further developing a successful corporate culture for the branch

1.2 The objectives of study

The study focuses on the concepts of corporate culture, the way it manifests

in an organization From the findings withdrawn from the case study of a selected organization – VietinBank, Hoan Kiem Branch, it is expected good recommendations will be made for creating corporate culture process of this branch Thus, the study aims to:

i Get deeper understanding of the corporate culture;

ii Understand why, what and how an organization forms and develops its corporate culture – a case study of VietinBank, Hoan Kiem Branch;

iii Find out some solutions and recommendations to develop and improve the corporate culture in this branch

1.3 Research questions

The key question of the study is: “What is the corporate culture of VietinBank, Hoan Kiem Branch?” To answer this research question, it is necessary

to answer the following sub questions:

i What is corporate culture?

ii What are the manifestations of corporate culture in VietinBank, Hoan Kiem Branch?

iii What should VietinBank, Hoan Kiem Branch do to improve its corporate culture in the future?

1.5 Structure of the thesis

The thesis includes three five chapters:

Chapter 1: Introduction

It identifies the statement of aims and objectives with clear indication of the issues, problems and hypothesis being considered

Chapter 2: Literature review

Definitions, forming factors and impacts of corporate culture can be found in this chapter A description of the layers of corporate culture is also provided to help the readers get a sound understanding of corporate culture

Chapter 3: Methodology

This chapter presents the research methods as well as data collections The manifestations are seen from different perspectives, ranging from visible to invisible manifestations

Chapter 4: Analysis and recommendation

Firstly, the corporate culture in VietinBank, Hoan Kiem Branch will be analyzed The manifestations are seen from different perspectives, ranging from visible to invisible manifestations Next, recommendations are made to further develop corporate culture in VietinBank, Hoan Kiem Branch In that, this chapter gives some suggestions for VietinBank in general to develop its culture Then, based

on that, recommendations to further develop corporate culture in VietinBank, Hoan Kiem Branch will be given

Chapter 5: Conclusion

The conclusion should be a brief resume of the investigation design and results and

an overall, personal evaluation of the whole study

CHAPTER II - LITERATURE REVIEW

2.1 Overview

This chapter provides background knowledge about the study The chapter will be divided into five main parts: the common concepts of the study including the concepts of culture and corporate culture; the forming factors and the main impacts

of corporate culture; the corporate culture’s levels developed by Edgar H.Schein and

a brief view on the role of leader to the development of culture in an organization

2.2 Definition of culture and corporate culture

2.2.1 Definition of culture

Culture is a familiar expression with human being Culture connects closely with our lives, or in other word, culture was born at the same time with human society However, it was not until the seventeenth century, especially from the second half of the nineteenth century, did scientists in the world concentrate on conducting in-depth researcher in this field Culture itself is a complex and diversified issue Therefore, each researcher has his own way to define what culture

scientists, culture is the full range of learned human behavior patterns The term

was first used in this way by the pioneer English Anthropologist Edward B Tylor in

his book, Primitive Culture, published in 1871 Tylor said that culture is "that

complex whole which includes knowledge, belief, art, law, morals, custom, and any other capabilities and habits acquired by man as a member of society." This definition refers quite briefly to every aspect of spiritual culture but does not exhaust the many uses of material culture which play a vital role in human culture treasure

There came many other definitions of culture after Tylor Nowadays, the definition stated by Mr Frederico Mayor, General Manager of UNESCO is agreed

by many people To him, culture is defined as “the set of distinctive spiritual, material, intellectual and emotional features of society or a social group, and that it encompasses, in addition to art and literature, lifestyles, ways of living together, values systems, traditions and beliefs” (UNESCO, 2002) This definition was worldwide accepted at Intergovernmental Conference of culture policies in 1970 in Venice In 1982, this approach was admitted at the second conference named Mondiacult

In terms of economy, scientists have different approach to culture In the

book of Geert Hofstede named Communication between Culture (1984), culture was

understood as the collective programming of the mind which distinguishes the members of one category of people from another In another viewpoint, according to Rao and Swaminathan (1995) culture refers to the values and beliefs shared by members in a society, includes patterns of behaving, feeling and reacting, and the premises underlying behaviors

From these above definitions, culture is summed up, spread and shared from one generation to another Culture is transmitted not only from parents to children

schools, churches and so on Common thoughts and behaviors are generated and maintained by social pressure and social trends In this thesis, the author will use the definition taken from the book International Business, 6th edition of Czinkota, 2001

In this book, culture is defined as a system of typical behaviors of each individual in every society This system consists of every aspect from the way people think, talk, and act to their habits, languages, material as well as spiritual products and their common viewpoints

Culture itself, which is both conservative and changeable, is a highly complex portrait of people Having a united definition of culture in mind will help us find an easier way to approach the issue of corporate culture

2.2.2 Definition of corporate culture

In the past, the answer for the question “Why do people work for a certain company instead of one another?” might be the reasonable salary, the benefits or the high position this organization offers However, in today’s changing business environment, intangibilities are increasingly more crucial to employees One tangible that seems to be most influential is corporate culture So what is corporate culture? In the early seventies of the twentieth century, following the spectacular success of many Japanese corporations, American corporations started to pay attention to the underlying reason behind it The term of “corporate/organizational culture” was used

by organization research professors and managers to refer to one of the main reasons behind Japanese corporations’ worldwide success

Many in-depth researches on composing parts as well as huge impact of corporate culture on the development of one enterprise were started to be carried out

at the beginning of the nineteenth decade There are various definitions for the concepts of “corporate culture”

Louis Handy mentioned corporate culture in the book “Understanding organizations” as set of understandings or meanings shared by a group of people that are largely tacit among members and are clearly relevant and distinctive to the particular group which are also passed on to new members

According to Donnelly et al (1992) organizational culture refers to the impact on the environment resulting from group norms, values, philosophy, and informal activities What this definition implies is that corporate culture is similar to culture in society as it has norms, values, beliefs and patterns of behavior The definition also highlights that values and norms create culture

Another definition comes from the International Labor Organization-I.L.O in

2005 that “Corporate culture is the values, beliefs, norms, and traditions within an organization that influence the behavior of its members”

Nevertheless, the most general definition of corporate culture is given by a professor of organization research, “Corporate culture is a pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct ways you perceive, think, and feel in relation to those problems” (Edgar H.Schein, 2004)

This thesis will take this definition as the standard definition of the study

2.3 Corporate culture forming factors

Although each enterprise’s special blend of elements develop a unique culture, a comparison of many enterprises identifies seven culture shaping factors (Plunkett and Attner, 1994) Each of these factors is in itself a complicated concept and none is independent of the others Their dynamic interaction forms the corporate culture

2.3.1 Key business processes

At the core of every corporation is the processes employees follow to gather information, make decisions, communicate, produce a product or service and manage work flow The corporation is defined by how leaders communicate to employees, how they share decision making and how they structure the work flow The corporate processes influence and are influenced by the other six factors that affect corporate culture

2.3.2 Employees and other tangible assets

A corporation’s resources such as employee population, plants and offices, equipment, tools, land, inventory and money, are used by the corporation to carry out its activities These are the most visible and complex factors that influence culture because their quality and quantity determine much of the corporation’s culture and performance

2.3.3 Formal arrangements

Another factor that affects corporate culture is the formal arrangements that organize tasks and individuals These arrangements include the structure of the enterprise and its procedures, rules and specific mandated behaviors

2.3.4 Dominant coalition

A corporation’s culture is significantly affected by the goals, objectives, strategies, personal characteristics and interrelationships of its leaders, who form the dominant coalition The leadership style of the corporation leaders determines how employees are treated and how they feel about themselves and their work

2.3.5 The social system

The social system contributes norms and values to the corporate culture Components like employees relationships, the grapevine and the informal organization are also parts of the social system Because people are in the enterprise, their relationships define the enterprise’s character

2.3.6 Technology

The principle technological processes and equipment that employees use also affect corporate culture For example, the utilization of technology plays a role The question to ask regarding technology is: Is a machine or process intended to productivity? The answer to this question sends a message about the value of employees in the enterprise

2.3.7 The external environment

An enterprise’s external environment includes forces outside its boundaries that directly and indirectly interact with it (Bittel, 1989) These forces might be suppliers, markets, competitors, regulators, organized labor and other elements outside an enterprise These forces affect the goals, resources and processes of an enterprise Obviously these elements shape the enterprise’s culture in many ways For instance, the government regulations can have a profound effect on corporate culture as they normally protect the enterprise from competition

2.4 The impact of corporate culture on the development of a corporation

2.4.1 Creating the unique manner and attitude for each corporate

Corporate culture is contributed by many components and elements such as business philosophy, customs, rites, habits, trains, or even the legend of the founder, etc All of these elements together contribute the style of an enterprise and help to distinguish this with others This style or manner and attitude plays the role like “air and water”, having a huge effect on the daily operation of enterprises

It is not difficult to recognize the manner and attitude of a successful corporation This style makes the strong impression on the outsiders and is the pride

of the corporation’s members Let’s take an example of the Walt Disney House When entering this corporation, people can feel some very common values through the uniform, some conversational language used by Walt Disney’s employees (such

as “a nice Mickey” means “You are doing well”), common behaviors (always smile and polite with customers) and common feelings (very proud of doing for Walt Disney)

2.4.2 Creating the centripetal force for the whole company

A good corporate culture helps company attracting the talent and strengthening employees’ loyalty

A person works not for money but for other needs The system of needs of human, according to Maslow, 1943, is a triangle including five kinds of needs in ascending order: basic needs, safety needs, psychological needs, self – actualization and peak experiences These needs are objective different tones of each individual Those needs create forces which impulse people to do but are not necessarily to be the ideals of their life

From the model of A Maslow, it can be seen that it is wrong if a company thinks that only high salary can help to attract and keep talent An employee will be loyal and want to have a strong attachment to a company only when he/she has interest in working, feels the nicely air and has the chance to assert himself In a quality corporate culture, all members have a clear awareness of their roles within overall, they work for common objectives

Figure 2.1 - Maslow’s hierarchy of needs

Common example Organizational example

Source: Duong Thi Lieu, 2008

2.4.3 Fostering innovation and invention

Within a strong corporate culture, the high self-reliance will be emerged Employees are encouraged to be apart and raise their own ideas This encouragement helps employees proving their own creative abilities, as a base for R&D process of a company On the other hand, the success of workers will create a diving force which helps to stick them with company for a longer time

2.4.4 Creating the competitive advantage of the corporation

The competitiveness of an enterprise can be adjusted in four aspects: flexibility (the ability of satisfying different needs of customer), the quality of goods/services (technological characteristic, reliability, industrial design, etc.), the

Achievemen

t

Statu

s Friendship Stability

Food

Working Challenges

Title Colleges Allowance

Base wage

responsible speed in the market (the period of time from ordering to supplying, speed

of developing a new product, etc.), cost (lower than competitors)

Enterprises who want to gain these advantages have to get three important resources: human resources, capital and technology The human resources involve directly adjusting, choosing and developing competitive advantages process of enterprise Hence, this resource has the key meaning to the ability of gaining these advantages Meanwhile, corporate culture has the first direct effect on each member

of an enterprise, which plays an important role in proving human resource So, indirectly, corporate culture can affect the competitive advantages of an enterprise in the market

2.4.5 Attracting customers

Thanks to the manifestation of corporate culture in each level, corporate culture helps to create the unique organizational character This also helps to improve the good image of company with customers, helps customers distinguish each company and establishes the customers’ loyal with company’s goods and services

2.5 Level of corporate culture

In general, corporate culture can be divided into two layers: surface layer and core layer Surface layer includes such expressions as dress code, work environment, benefits, conversation, relationship, etc The core layer consists of something cannot see or hear like values, invisible rules, attitude, benefit, assumptions, etc However, according to Edgar H.Schein, a professor of organization research, in the book

“Organizational culture and leadership”, corporate culture has three layers or three

levels They are observable artifacts, espoused values and basic underlying assumptions

Figure 2.2 - Levels of Corporate Culture

Source: Edgar H.Schein, 2004

If we regard corporate culture concept as a metaphor, three levels of corporate culture can be described as an iceberg

Artifacts

Visible organizational structures and processes (hard

to decipher)

Espoused Values

Strategies, goals, philosophies (espoused justifications)

Basic underlying assumptions

Unconscious, taken-for-granted beliefs, perceptions, thoughts, and feeling (ultimate source of values and action)

Figure 2.3-Corporate culture-iceberg’s principle

Source: Edgard H Schein, 1999

Edgar H Schein reveals that what we commonly call “corporate culture” merely the tip of the iceberg, an iceberg that mangers ignore at the peril of their company’s future Underneath lays the much-harder-to-grasp “essence” of the company, the “learned, shared, tacit assumptions on which people base their daily behavior” In fact, only the floating part of an iceberg which accounts for about 10 to

20 percent of total weight can be seen The other hidden part which accounts for roughly 80 to 90 percent does decide the direction of an iceberg Let’s imagine that the floating part is under the influence of the wind power while the hidden part is under the influence of underground flow Thus, iceberg’s direction will be under the influence of underground flow regardless of wind power Therefore, we can be

Artifacts

Espoused Values

Basic underlying assumption

clearly conscious of the importance of basic underlying assumptions to an enterprise Details of three levels will be described as follows

2.5.1 Observable artifacts

At the surface of corporate culture is the level of artifacts This level includes all the phenomena that one sees, hears and feels when one encounters a new group with an unfamiliar culture Artifacts include the visible product of an organization, such as the architecture of its physical of its environment, language, technology and products, its artistic creations, its styles (clothing, manners of address, emotional displays), myths and stories told about the organization, its publish of list of core values, its observable rituals and ceremonies and so on

The most important point to be made about this level of the culture is that it is both easy to observe and very difficult to decipher The Egyptians and the Mayans both built highly visible pyramids, but the meaning of pyramids in each culture was very different tombs in one, temples as well as tombs in the other In other words, observers can describe what they see and feel, but cannot reconstruct from that alone what those things mean in the given group, or whether they even reflect important underlying assumptions On the other hand, one school of thought argues that one’s own response to physical artifacts such as buildings and office layouts can lead to the identification of major images and root metaphors that reflect the deepest level of the culture (Gagliardi, 1990) This kind of immediate insight would be especially relevant if the organization is experiencing in the same larger culture as the researcher The problem is that symbols are ambiguous, and one can only test one’s insight into what something may mean if one has also experienced the culture at the deeper levels of values and assumptions

Based on this foundation, the artifact can be divided into the following categories:

 Architecture, decoration, technology, product;

 Symbol, logo, brand name, slogan;

 Language and dress;

 Leadership style;

 Behavior within organization;

 Behavior toward customers;

 Ceremonies, stories of heroes, etc

2.5.2 Espoused beliefs and values

The next level of corporate culture is about the values Values define what an enterprise needs to do, what is right or wrong There are two kinds of values The first one is available values which exist objectively and unprompted takes shape in corporation The other one is values which managers expect the corporation to own and develop step by step

Espoused values are those principles or ideas the group articulates or announces publicly as what stand for or what they are trying to achieve Values here include vision, mission, business philosophy and core values

a Vision

The first step when building objectives and priorities is to briefly identify what our corporation will be in one point of future time, or in other words, to build vision

Vision is the future status that an organization strives for Vision shows us common purpose and united activities “Vision” term refers to a spiritual picture, a prospective of the organization future This term also refers to some time limited, or time horizon, in the short or middle run which normally is ten, twenty or fifty years for an influential vision

Expected vision should be a picture of where an enterprise will be in one certain future day It is a picture of what it takes to reach perfection, for instance, or for the best production method, or even of same quality production method when company’s overall turnovers decrease to 10%

It is necessary that corporation vision will be built first of all and informed to every member Enterprise’s departments will take step specify objectives, methods and tools to achieve vision

It is essential that organization’s mission is designed for one certain stage of its life

c Business philosophy

Business philosophy is philosophic thoughts reflecting the business reality by experiencing, thinking and generalizing of business subjects and then used to instruct business activities of an organization Business philosophy of an organization consists of three parts: mission and basic targets, operating method and specific business activity

The roles of business philosophy are:

 The core of corporate culture, creates the firm development method for corporate culture;

 The oriental tool and base for strategic management;

 The medium for training, developing human resource and creating the specific working style for company

d Core values

Organization core values are purified essence and are commonly recognized

It has a great impact on individual norm, behavior, and attitude among company It is also the foundation of vision Core values are similar to rulers of norms of behaviors Thanks to it, we are conscious of what consistent with company’s mission and then reach vision Core values are those will never change no matter how tough a company suffer, unless the enterprise goes bankruptcy or dissolution

Upon visiting Vietnam on January 10th, 2005, Brian Bacon who is the president of Oxford management Institute and former Chief Executive Officer (CEO)

of Australian Coca-cola told an excellent example of core values for corporations When taking a VND ten thousand paper-money in hand and ask, everybody will

and ask, we will still receive the same answer And even when we drop and beat it and ask, the result is still ten thousand Vietnamese dongs (VNDs) It simply represents unchangeable value of the paper-money, or core values of an enterprise, in any circumstance

Values can be core values when: (1) there is united belief in whole organization; (2) it sets up norms and standard; (3) solid values to the very last thing; (4) there are myths, rites or stories supporting existence

2.5.3 Basic underlying assumptions

The deepest level of culture consists of shared assumptions that provide a foundation for how people think about what happens in organizations These assumptions represent beliefs about reality and human natures that are taken for granted and embedded in the way we understand and interpret daily life Schein contends that underlying assumptions grow out if values, until they become taken for granted and drop out of awareness Assumptions are the result of continually validated and reinforce values, they guide group’s behavior, perceptions, thoughts, and feeling about a situation They can deal with basic aspects of life through the correct way for the individual and group to relate at each other; relative importance

of work, family, and self-development; the proper role of men and women; and the nature of the family Therefore, shared assumptions are the most difficulty to study and to change because people may be even unaware of or unable to articulate the assumptions forming their deepest level of culture

The basic underlying assumptions of an organization are thoughts, beliefs, awareness and emotion toward the internal and external environment These are

assumptions of human, quality, performing ability, customers, competitor and the role of invention The manifestation of underlying assumptions is expressed through the conception of relationship between human and environment, conception of trust and reality, conception of human nature, of human activity and the nature of human relationship and the conception of time

1 Conception of relationship between human and environment deals with the questions: What is our relationship with the environment? Do members believe they have the capacity to master the environment, are they supposed

to live in harmony with it, or do they think they are controlled by it?

2 Conception of trust and reality are about the way to reveal the truth What is real and how to determine the reality? Is truth revealed by external authority figures, or is the accuracy of information determined by a process of personal investigation and testing?

3 Conception of human nature give answers to such questions: defines what it means to be human and what human attributes are considered intrinsic or ultimate Is human nature good, evil, or neutral?

4 Conception of human activity can be divided into three approaches: (1) a

“doing” orientation where people are basically active and evaluated according

to what they produce, (2) a being orientation where people are passive and unable to alter existing circumstances, and (3) a “becoming” orientation where people are continually developing and becoming an integrated whole

5 Conception of human relationship: defines what is ultimately the right way for people to relate to each other, to distribute power and love? Is life cooperative or competitive; individualistic, group-collaborative, or

employers and employees? Is authority ultimately based on traditional lineal authority, moral consensus, law, or charisma? What are the basic assumptions about how conflict should be resolved and how decisions should be made?

6 Conception of time: The shared assumptions that define the basic concept of time in the group, how time is defined and measured, how many kinds of time there are, and the importance of time in the culture

2.6 The role of leader – key factor creating the corporate culture of organization

The leader is not the one who creates the values of corporate culture in an organization but more important, he/she is the one who transmit, maintain and change them into a “guiding system” to the whole company It is important for enterprises which want to succeed to have the sound system of principles These principles are the foundation for enterprises to set their line and actions It is more important that this system needs to create the loyalty, the attachment within the organization and is absolutely followed This requires the leader who creates the values’ system to keep in close touch with employees and assist them and at the same time, heighten these values

Beside the role of shaping and managing corporate culture’s values, the leader has to change them according to the requirement of changing strategy in the case culture does not support or even be against with a new strategy

The new strategy is often dominated by market and competitors – these external elements which organization can not control Meanwhile, culture is created

by the whole organization so changing culture to fit the strategy is more effective

than changing strategy to fit culture However, it takes time to erase all the existing culture because it has had a long time to shape and develop In particularly, this change is really difficult with the founder Although, when corporate culture is suitable with the new strategy, it will bring much more achievements for organization

In general, if national culture tends to naturally affect the corporate culture, the leader plays a very active role in creating process of it This means, the leader with his/her goal to help organization gain a good performance, by his/her managing behavior, this contributes to set a “unique style” for an organization, that is corporate culture

CHAPTER III - RESEARCH METHOLOGY

3.1 Overview

The purpose of this chapter is to measure the impact of corporate culture Research approach is defined by the use of data collection, and selecting samples

3.2 Research methodology

The methodology uses in this research that is qualitative research

Qualitative research is a type of scientific research In general terms, scientific research consists of an investigation that:

• seeks answers to a question

• systematically uses a predefined set of procedures to answer the question

• collects evidence

• produces findings that were not determined in advance

• produces findings that are applicable beyond the immediate boundaries of the study

During the 1970s and 1980s, qualitative research began to be used in other disciplines, and became a significant type of research in the field of education studies, social work studies, and many other fields The goal of qualitative research is

to gather a deep understanding of human behavior and the reasons that govern behavior Qualitative methods also are investigating why and how of decision making So the smaller samples are more focused than large samples

The advantage of qualitative research is its ability to provide complex textual descriptions of how people experience a given research issue It provides information about the “human” side of an issue – that is, the often contradictory behaviors, beliefs, opinions, emotions, and relationships of individuals When used along with quantitative methods, qualitative research can help us to interpret and better understand the complex reality of a given situation and the implications of quantitative data Qualitative methods are also effective in identifying intangible factors, such as social norms, socioeconomic status, gender roles, ethnicity, and religion, whose role in the research issue may not be readily apparent Qualitative research can help us to interpret and better understand the complex reality of a given situation

3.3 Data collection

This thesis is written based on both primary and secondary data Most of the materials are extracted from the relevant books, articles, and documents in both English and Vietnamese The data, concepts, theories are collected to analyze the situation of VietinBank, Hoan Kiem Branch to answer these three sub questions

The approach of qualitative research in this project is documentation, direct observation and interview Documentation is used as secondary source of information in forms of books, articles and websites to collect information of theories relevant for this thesis, background information about the organization and the standards of its corporate culture Direct observation is appropriate for collecting data on naturally occurring behaviors in their usual contexts For this study, direct observation is the main primary method to help the writer collect the information of

data on individuals’ personal histories, perspectives, and experiences, particularly when sensitive topics are being explored In this study, the interview provides the added information for the research of the real situation and helps the writer to make suitable recommendations

3.4 Sampling

The sample population is the ViettinBank and its staffs Currently, VietinBank has 138 branches, 188 transaction offices, 258 points of sales and 191 savings offices, 742 Automatic Telling Machines (ATMs), throughout 56 provinces and cities, centered more in big cities such as Hanoi (12 branches and 02 transaction centers), Ho Chi Minh City (17 branches and 01 transaction center), industrial zones, trading and economic parks, densely-populated areas However, due to the far distance, and the time limitation, the author was able to conduct the study at one its Branch: Hoan Kiem Branch The author will make an observation of the entire building of the company and interview 10 staff members (five veteran employees, four young employees and one deputy manager of a transaction office) who are randomly selected from different departments in the company to get information for the thesis

CHAPTER IV - RESEARCH ANALYSIS AND RECOMMENDATION

4.1 Overview

This chapter includes four main parts: Part one is an overview of Vietinbank, Hoan Kiem Branch Part two is a brief view on of the corporate culture of VietinBank in general Part three is that concentrates on analyzing the manifestations

of corporate culture in VietinBank, Hoan Kiem Branch using the frame developed by Edgar H.Schein Part four provides some recommendations to further develop corporate culture in Vietinbank, Hoan Kiem Branch The main objective of this chapter provides suggestions for further development of corporate culture in VietinBank, Hoan Kiem Branch At first, this chapter will give some suggestions to VietinBank in general and then to VietinBank, Hoan Kiem Branch in particular Although there are many factors determining the development process of corporate culture in an organization, with VietinBank, Hoan Kiem Branch, the author mainly focuses on the leadership style, the values system and the relation with customers

4.2 An overview of Vietinbank, Hoan Kiem Branch

4.2.1 Introduction of Vietinbank

Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) was established in 1988 after being separated from the State Bank of Vietnam It is one of the four largest State-owned commercial banks of Vietnam, VietinBank’s total assets account for over 20 percent of the market share of the whole Vietnamese banking system The year 2009 marked a very important point in the development

process of VietinBank In June, 2009, VietinBank officially became a joint-venture commercial bank This brought about both new challenges and success for the Bank

VietinBank has developed an operation network comprising of one head office; three transaction centers; three subsidiaries, three administrative units, two representative offices, 138 branches, 188 transaction offices, 258 points of sales and

191 savings offices, 742 Automatic Telling Machines (ATMs), throughout 56 provinces and cities, centered more in big cities such as Hanoi (12 branches and 02 transaction centers), Ho Chi Minh City (17 branches and 01 transaction center), industrial zones, trading and economic parks, densely-populated areas Vietinbank’s traditional services as well as other modern and valued added services have reached nation-wide users This has enabled Vietinbank to diversify its products suitable to each segment of customers Besides, it is diversified with three independent accounting subsidiaries: VietinBank Leasing Company, VietinBank Securities Company, Ltd., VietinBank Asset Management Company and two non-profit making units: VietinBank Information Technology Center and VietinBank Training Center

VietinBank is also the founder of some Financial Credit Institutions such as Saigon Bank for Commerce and Industry; Indovina Bank (the first joint-venture bank

in Vietnam); Vietnam International Leasing Company – VILC (the first financial leasing company in Vietnam) and Vietinbank Insurance Company Ltd This bank has also being the official members of Vietnam’s Banker Association; Asian Banker’s Association; Society for Worldwide Interbank Financial Telecommunications (SWIFT) and the Visa International Services Association

The Bank has signed eight framework-credit Agreements with foreign countries including Belgium, Germany, South Korea, Switzerland and established