Luận văn thạc sĩ UEB motivating employees reaseach at the north petro vietnam fertilizer and chemicals joint stock company

UPPSALA UNIVERSITÉT & VNU UNIVERSITY OF ECONOMICS & BUSINESS UPPSALA UNỈVERSITET MASTER THESIS OF MPPM MOTIVATING EMPLOYEES RESEARCH AT THE NORTH PETRO VIETNAM FERTÍLĨZKR AND CHEMICALS IOỈNT STOCK COMPANY Author: Tran Thanh Binh Supervisor: Prof Lars-Torsten Eriksson Locaì Supervisor: Ph.D Nguven Ngoe Thang Class: MPPM INTAKE Hanoi, January 2015 ACKNOYVLEDGEMENT In completion of this thesis, íìrst of all I vvould like to express my sincere and deep gratitude to Prof Lars-Torsten Eriksson (Uppsala University - Swedcn) and PhD Nguyen Ngoe Thang (Vietnam National University), íor their experienced guidance and valuable suggestions throughout this thesis I would like to thank you for their support which kept me motivated throughout the writing and editing this thesis I am also grateíul to the Board of Directors, the colleagues at North PetroVietnam Fertilizer and Chemicals Joint Stock Company who spent their valuable time to ansvver responsibly and thoughtfully the questionaire Thcretbre, the data for the rescarch could be collected conveniently Pinally, I would like to thank to my teachers, Goveming Board of University of Economics and Business (Vietnam National University), Uppsala ưniveristy (Sweden); managers and staiTin Centre ofIntemational Training and Education, my dear triends and my tầmily vvho constantly gave me support and encouragement during the time the study vvas carried out ABSTRACT Research title: Motivating Employees - Research at the North Petro Vietnam Fertilizer and Chemicals Joint Stock Company Level: Final assignment for Master Program in Public Management Author: Tran Thanh Binh Supervisors: Prof Lars-Torsten Eriksson Dr Nguyen Ngoe Thang Date when the thesis is presented: 6th Decemher2014 Aim: The study has been conducted so as to tìnd out the problems of motivating employees in PVFCCo North based on analyzing the cuưent situation of vvork motivation In this light, the study sets to recommend some solutions to improve work motivation in the company Method: descriptive statistic from the questionaire, sccondary data írom the data source of thc company Findings and conclusions: The study aims at investigating and then dravving conclusions : - Theoretical basic will be studied to make clear about the importance of motivation - After analyzing the current situation of work motivation in PVFCCo Norlh, I inysclt' find out some íầtors leading to thc íầct that crcating vvork motivation is inefficient here Theretbre, some solutions to stimulate employees at work are suggestcd as íbllovvs: • The motivation to employees by tìnancial íầctors : ctTectively reform salary payment policy by applying volumc \veight in salary calculator or paying market cadrcs by perfonnance of tasks, sales and prìts • The motivation to employees hy noníìncial íactores: set up an evaluation system with the Key Períormance Indicator (KPI) to make sure of equality; đìne the Compctency Dictionary and Competency Model to use as the background to assess pertbrmance of individual labor.take training soft skills of management for mid-level leaders into consideration Suggestions for futher research: A number of limitations can be disccmed in the studv due to the time constraints and the limited scope Firstly, the subject research is only laborer in the PVFCCo North Secondly, the solutions are still incomplete This study thcrefore can be seen as an introduction for more detailed study to bc carried in the 1'uture by myself The next research can be about building up Competency Dictionary, Competency Model as a basic to evaluate an individual employee, or develop the Key Perlbrmance Indicator to ensure the tầimess of monthly/ annually assessment 10 Contributions of the thesis: The study has Consolidated the theories on motivation The results of the study can help PVFCCo North have a vievv of actual situations of work motivation and how effective the stimulating methods work They also point out problems vvhich should be concemed to change Some solutions hence are given in order to improve motivation policy and vvork as the basic for labor management 11 Keywords: motivation, períbnnance, encouraee, needs, improve TABLE OF CONTENT ACKNONVLEDGEMENT ABSTRACT TABLE OF CONTENT LIST OF TABLES CHAPTER I: INTRODUCTION Rationale Aims of the Study Subịects and scope ofthe Study Method of the S tu d y 4.1 Overview o f document 4.2 Investigation survey Structure of the thesis CHAPTER II: THEORETICAL BASE ON MOTIVATION CREATION Motivation as a company problem 1.1 Fundamental dìnitions 1.2 The role of motivation creation Motivating íacto rs 2.1 The motivation to employees by íinancial factors 2.2 The motivation to employees by non-financial íầctors Motivation theories 3.1 Abraham Maslow’s Hierarchy of Nccds 3.2 Two Factor Theory of Prederick Herzbcrg 3.3 McClelland's Human Motivation Theory 3.4 Equity Theory of Stacy A d a m s 3.5 Expectancy Theory of Victor Vroom Literature review on motivation CHAPTER III: METHODOLOGY The basis o f research questions panel Research questions construction 2.1 Questionnaire and process of information collection 2.2 Designing research questions 2.3 Sampling 2.4 Methodological issues CHAPTER IV: RESULTS AND DISSCUSSÍONS The overviexv of PVFCCo North 1.1 The process o f fonnation & development and the business períbrmance 30 1.2 Organizational Structure 1'unctions and dutics o f parts 1.3 The utilization oí'resources 2.The current situation of motivation implemcntation at PVFCCo N orlh 2.1 The analysis o f current situation of motivation implementation 2.2 Inherent problem s CHAPTER V: CONCLUSIONS AND RECOMENDATIONS 1.Solutions 1.1Solutions on motivation promotion by 1.2Solutions on motivation promotion by 2.Recommendations 3.Conclusion REFERENCES APPENDIX Number tables 4.1 Business pe 4.2 Structure ot 4.3 Labor force 4.4 Labor force 4.5 Labor force 4.6 Results of d their income Results of d working Results of d job charateri Results of d training and Results of d leaders Results of d their colleag Results of d motivation 4.7 4.8 4.9 4.10 4.11 4.12 LIST OF DRAWINGS, DIAGRAMS Pages 31 34 35 35 36 40 41 42 43 44 45 46 Numbcr diagrams drawings 2.1 Ma 2.2 Ma 4.1 Ave 4.2 Org 4.3 The CHAPTER I: INTRODUCTION Rationale A great number of people feel confuscd when fmding thc way to exploit their potentials themselves though each laborers has their own certain intcrnal resources Humans always have the physcal and mental needs to be satisíìed When laborers’ needs are met.thev wil be encouraged to work harder and harder If no motivation is present in an employee, it is difficult for them to attain labor eoals because at that time the assigned work will be completed without any creativity and effort As a result, the work will be considered as a duty to pertorm under the labor contract Organization is a group of laborers in which they vvork tovvards common goals The goals are promoting the organization development and creating its position in the market Vice versa, in order that laborers vvill receive both íìnancial and non-íìnancial revvards from the organization, the managers need to create incentives to promote creativity and job performance of employees Managers, therefore, must thoroughly understand the management philosophy, especially the desire and psychology of laborers in their organization for the maximum utilization o f each laborer's value When each employee become the "boss" of his own working process, it mcans that thcy are allovved room to work, fínd the joy, realize their responsibilities and eíTorts to be more productive This will enablc hoth parties to get committed towards the fulfilment of each other’s needs The problem of how to motivate laborers is increasingly bcing more interested in the current enterprises In reality, employees in North PetroVietnam Fertilizer and Chemicals Joint Stock Company have been being motivated though the results are not satisíìed as đesired and vvorkers have not perfonned at their best A very hi^h yield does not reílect the true ability of workers From the íầct that I selected the thesis subject: Motivating employees Research at the North PetroVietnam Fertilizer and Chemicals Joint Stock Company (PVFCCo North) with ambition to offer an insightful understanding of thc cuưent situation of work motivation in the company and propose some solutions to rnotivate laborers contributing to the sustainable and eíTective development of the cornpany - Research Qucstions: The Study will be conducted to answer the following questions: + What are the current situations of work motivation in PVFCCo North? + What are the solutions to enhance work motivation for laborers in PVFCCo North? Aims of the Study The aim ofthis thesis is to summarize the current research fìndings about work motivation, to analyze the work motivation at PVFCCo North and to propose activities that can improve the motivation in this company Subjects and scope of the Study - Subịects of the Study: the theoretical issues, practices related to motivation creation for laborers - Scope of the Study: + About content: The content is mainly related to the motivation creation for laborers in the organization + About time: This study started from June 2014 + Abouí space: Suhịect focused on researching and proposing solutions in ordcr to create vvork motivation for laborers in PVPCCo North Method of the Study 4.1 Overview of document Analyze and synthesize the documents related to creating vvorkplace motivation: - The role of the human resource management in organizations - Theoretical Foundations about creating work motivation for laborers working in the organization - The tools to create motivation for laborers at vvork novv 4.2 Investigation survey Base to build questionnaire to research vvork motivation in PVFCCo North: - The theoretical base on motivation for laborers at vvork in the organization, and many domestic and overseas researches about job satisfaction as well as tìnding about the elements to promote the workplace motivation for laborers - Theory of Herzberg and research model of Smith (1969), vvith the reterence of the expcrts in this íìeld The motivational í'or laborers working in PVFCCo Nơrth depends on the following íầctors: + Work itsclf + Training opportunities and advancement + Salary + Supervisor support + Co-worker relations The construction of the questionaire is based on the above five components, as vvell as the measurement criteria of each component Structure of the thesis The thcsis consists of five chapters, speciíìcally: - CHAPTER I: INTRODUCTION - CHAPTER II: THEOREOTICAL BASE ON MOTIVATION CREATION - CHAPTER III: METHODOLOGY - CHAPTER IV: RESULTS AND DISSCUSSIONS - CHAPTER V: CONCLUSIONS AND RECOMMENDATIONS 49 The application of volume weight in the above obịects will ensure the equality for those who have tasks with more volumes, more responsibilities and more dangers in sites in comparison with the indirect volumes in the office Besides, the Company also studies to pay salary for the employees being the market cadres by perfonnance of tasks, sales or profits to increase the activeness in the implementation of work as vvell as the working motivation When applvine this method the employees have to make more eíTorts because their incomes are not íĩxed anymore but depending on their ability The salary payment can be íbllovv the effectiveness of the work perfonnance or use the way of revvard calculation as the effective salary íormula as above 1.2 Solutions on motivation promotion by the non-fĩnancial - Solutions on motivation promotion by evaluation o f the performance: To ensure the effectiveness of the bonus payment as well as salary payment the company needs to develop the Key Períormance Indicator (KPI) as a basis for evaluation The Company may hire the consultancy units to set up this indicator to ensure obịectivity In addition to the emulation forms at the end of the year, whenever the cmployees gains the outstanding pcrfonnance, the company's leaders should have the fonns of extraordinary bonus and timely infonn and praise the employees so they they can feel their efforts to be appreciated, and vvill continues to try harder - Solutions on motivation promotion by training and advancement policy: As analyzed, thc appointed leaders in PVFCCo North are often the people who have high proíessional skills but lack experiences, specialized management and leadership skills That the leaders are weak at management skills easily lead to mistakes in the assignment of task for the employees They will not cover the work, or care for work and life of their staff This will make employees feel separated, untầir, etc So PVFCCo North should take training soft skills of management for mid-level leaders into account so that these managers can improve methods o f employee management When they convey motivation to their staff, they themselves have to make more efforts In particular, with advancement policies, a medium-sized enterprise as PVTFCCo North is difficult to have a lot of management positions for the employee 50 to hope for the advancement; however, it does not mean that PVPCCo North will continue to shrink advanccmcnt policies for its employees as at the present time Promotion policies should be open to all staff although it takes a lot of time to achieve any position In addition, employees need to be made aware that advancement is not just to get a certain position but also to get the position that they have from the admiration, respect of colleagues (including colleagues as ieaders and staff) In addition, it is essential for the Company to creat the Compentency Model and the Compentency Dictionary for individual assessment Assessing employees’ performance can result in evaluating laborers' actual performance and identifying how well individual matches his job title, íbrming basic for personal management: - Work assignment - Personel appointment - Training and advancement - Paying salary and bonus - Encouraging laborers to best in vvorking process, motivate vvorkers The results of individual compentency assessment are the tools helping managers establish íeedback system and indicate for low- level employees’ development Recommendations In order to vvell iinplement measures to promote motivation for employees vvorking in PVFCCo North it nceds the efforts ot’ all departments, the Board of Management and thc Board of Directors to make the right policy Besides,when making policies, the managers should have a rcgard to the legal íactors, extemal factors, intemal ability of the company as wcll as the desire of the employees, which bring about a reasonable calculation for budget and direct the staff to take actions to get the eíTectiveness for the organization and to satisíy the staff It is necessary for the Company to build the open culture in vvhich employees honestly share and collaborate together The comfortable working environment vvill make the einployees and the managers timely receive feedbacks to adjust and makc the appropriate action 51 Hovvever, motivation promotion also needs the support of thc individuals They must bc willing to speak out the aspirations of themselves The employees should seek 1'or the enthusiasm in their work, just like that, the employees find out a strong encrgy in themselves and develop the innovation and creation capabilities at work Conclusion Employees are an dispensable part of an organization F.mployees’ satisíaction is a key indicator of business success Nowadays, the development and existence of an organization not totally depend on decisions of Capital, technology, or equipment but on the human tactor Thereíore, the problem of motivating employees is alvvays an issue that all organizations take into consideration Employee inotivating is extremely important, it determine the development of an organization The success or tầilure of an organization or company dues to vvhether or not that organization usc appropriate tools to well stimulate employees for capacity and productivity improvement, thus, motivating employees is an urgent requirement for executives By studying the theories of motivating employees and basing on the actual situation at North PVFCCo, the author would like to suggest some solutions to contributc to activity of motivating employees in PVPCCo North in the íuture This study thereíore can be seen as an introduction for more detailed study to be carried in the íuture by myself The next research can be about building up Competency Dictionary, Competency Model as a basic to evaluate an individual cmployee, or develop the Key Performance Indicator to cnsure the ĩaimcss of monthly/ annually assessmcnt I am looking forward to receiving feedbacks from teachers and scientists íor a more complete thesis 52 REFERENCES Vietnamese [1] Assoc.Dr Le The Gioi, Administration, Financial Publishing House 2007 [2] MSc Nguyen Van Diem Assoc.Dr Nguyen Ngoe Quan (2004), Syllabns Human Resource Management, Labor and Social Publishing House 2004 [3] Dr Nguyen Quoc Tuan Dr Doan Gia Dung, MSc Dao Huu Hoa, MSc Nguyen Thi Loan, MSc Nguyen Thi Bich Thu, MSc Nguyen Phuc Nguyen (2006), [4] Paul Hersey and Ken Blanc Hard (2001), Management o f Organizational Behavior, Statistical Publishing House, HCM City [5] Nguyen Van Long (2010), “Promoting human resources by motivating'’, Journal o f Science and technology, Da Nang University - No 4(39).2010 [6] George T Milkovich and Jonh w Boudreau (2002), Human Resource Management, Statistical Publishing House [7] Hoang Trong & Chu Nguyen Mong Ngoe (2005), Analysis o f research data andhandle SPSS, Statistical Publishing House ot'HCM City English [ 8] Isabelle Zhang (2009) Master Thesis: Taking on the Chinese Challenge: Motivating Chinese employees at Swedish companies in China, Stockholm School of Economics [9] Micheal Amstrong (2006), A handbook o f personneỉ management practice, [10] Tan Teck-Hong and Amna Waheed (2011), “Herberg^s Motivation Hygiene Theory and Job satisfaction in the Malaysian Retail Sector: the mediating effect of love of money”, Asian Acedemy o f Management Journal, Vol.16, No 1, 73-94 [11] Thang, N N (2009) “Human resource training, organisational strategy, and tìrrn performance in cmcrging economies: The case of Vietnam”, PhD thesis Degree o f Doctor in Applied Economics, Ghent University ISBN: 978-90-5864-197-7 53 [12] Schieb, L J & Karabenick, s A (2011) Teacher Motivation and Proíessional Dcvelopment: A Guide to Resources Math and Science Partnership - Motivation Assessment Program, University of Michigan, Ann Arbor, MI [13] Chandra Sekhar, Manọị Patvvordhan, Rohit Kr.Singh (2013) A literature revievv on motivation International network of Business and Management 2013 Glob Bus Perspect (2013) 1:471-487 54 APPENDIX Appcndix THE SURVEY OF EMPLOYEE’S ASSESSMENT ON MOTIVATION IMPLEMENTATION AT PVFCCo NORTH My name is Tran Thanh Binh vvorking currently in Administration Department of PVFCCo North I am in the process of doing the research vviUi the title of Motivating employees - Research at the North PetroVietnam Fertilizer and Chemicals Joint Stock Company For the objectives that the research truly and fully reílects on the current situation on employee’s motivation at PVFCCo North and then, suggests some positive comments to the board of directors to complete this motivating system and help the employee’s demand to be met in a better way, I vvould like to get your ideas through the belovv question panel ịby m arkingX in checked boxes) I hearby assure that those data are only used for this research and your ideas are kept completely confidential Thank you so much for your attention Please indicate your level of agreement on those belovv statcmcnts For each statement, please kỉndly mark X in the boxes numbered 1-5: l.Totally disagree, 2.Disagree, 3.No idea, 4.Agree, 5.Totally agree Level of No Statements I Job ĩeatures I love my current job I unđerstand clearly my job My job allows the maximum personal capacity My job is challenging and interesting I can give the íìnal decision of some matters within my profession II Working conditions I am provided all necessary equipments to work My working place always ensure convenience and safety The workload is distributed logically My working time is arranged logically III Trainings and Development 10 I am fully trained some appropriate skills to vvork agreement 55 1am provided all good conđitions to advance professional 11 12 13 knovvledge The company usually oíTers development chances for qualitlcd people Training policy and development are fair to everyone IV ỉncome 14 My salary is worth to my capacity and competence 15 I have got bonuses and allovvance vvorth to my vvorking eíĩectiveness 16 Remuneration and allowances are distributed equally 17 I can live solely on the income received from the company V Managers 1have no difficulty in communicating and exchanging ideas with my 18 managers 19 Superiors always encouraged me when needed 20 Everyone is granted on tầir treatment 21 My superiors are capable of management 22 My superiors have highly qualitìed competence 23 My superiors are ready to authorize when necessary VI Colleagues 24 My colleagues are willing to help me when needed 25 My colleagues are tViendly and sociahle 26 My colleagues always work conscientiously 27 Vly colleagues are trustworthy people VII Employee Motivation 28 Overall, I am motivated vvhen working in this company 29 l am glad to select this company to work 30 I consider vvorking place as the second home In your opinion, what should the company change? (you can choose many B 31 32 33 34 different options) Better working conditions and environment Higher salary and incentive policy Improvement on job performance evaluation Trainings and development 56 35 Development strategy of the company c Personal Inĩormation Gender: Seniority Position Qualitĩcation Average income per month Age □ 57 Appcndix Payroll and salary scale of PVFCCo North Payroll for positions of enterprise managers No Job title Chairman of Administrative Council of Company - Co-efficient - Salary Director - Co-efficient - Salary Deputy Director, Members of Administrative Council - Co-efíìcient - Salary Chief accountant, Head of Board of Supervisors - Co-efíìcient - Salary Members of Board of Supervisors - Co-efficient - Salary Heads of departments, Heads of Branches and equivalent - Co-efficient - Salary Vice head of departments, Vice Heads of Branches and equivalent - Co-efficient - Salary 4> ỉ ỉ ỉ í c5 -co-efficient seniorspecialists Experts,advisors, D.01 6.15 Code 6.80 7.49 8.38 9.28 10.18 11.08 VII Salary grade 11.98 IIIA Payroll for proíessional and server execute X X > > > B s XII No 59 Appendix AIIowances No Allovvances Responsibility allovvance Heads of vvarehouse/station/group, people in 1.1 charge of parts of company’s branches or Rate Amount 0,7 1.260.000 equivalen t 1.2 Vice Heads of warehous e/station/ group or 0,4 720 00 equivalent 1.3 Manager of stores or equivalen t Da nge r, haz ard s all ow anc e 2.1 Level 2.2 Level 2.3 Level 3 All ow anc e of rar e job att rac t i o n - Skill ful tech nical empl oyee s in the mark et Dan g e r , h a / a r đ s a llowance, high qualiricatỉon 0,3 540.000 0,1 180.000 0,2 360.000 0,3 540.000 0,3 540.000 Experís, engineers with Doctor qualitìcation 0,3 540.000 working in the fíeld o f their major Experts, engineers with Master qualirication 0,2 360.000 working in the íìeld of their mạjor Travelling/work site allovvance Seniority allovvance (from 01/09/2007) 6.1 Level 1: From 36 months to 72 months 6.2 Level 2: From 72 months to 96 months 6.3 Level 3: More than 96 months Extra-Seniority allovvance Union concurrently allovvance 0,4 720.000 0,1 0,2 0,3 180.000 360.000 540.000 % % ... ability of workers From the íầct that I selected the thesis subject: Motivating employees Research at the North PetroVietnam Fertilizer and Chemicals Joint Stock Company (PVFCCo North) with ambition... grateíul to the Board of Directors, the colleagues at North PetroVietnam Fertilizer and Chemicals Joint Stock Company who spent their valuable time to ansvver responsibly and thoughtfully the. .. under model of a joint stock companv whose majority shareholder is Petrovietnam Fertilizer and Chemicals Corporation- a member of Petrovietnam North Petrovietnam Fertilizer and Chemicals Enterprise