(Luận văn) key factors affecting employee satisfaction in the banking industry evidences from ho chi minh city

t to ng hi UNIVERSITY OF ECONOMICS HO CHI MINH CITY ep International School of Business w n lo ad ju y th HA NGUYEN MINH TAM yi pl ua al KEY FACTORS AFFECTING EMPLOYEE n SATISFACTION IN THE BANKING INDUSTRY – n va ll fu EVIDENCES FROM HO CHI MINH CITY oi m at nh z z k jm ht vb om l.c gm MASTER OF BUSINESS (Honours) an Lu SUPERVISOR: DR DINH THAI HOANG n va ey t re th Ho Chi Minh City - 2014 t to ng hi TABLE OF CONTENTS ep ACKNOWLEDGEMENT w n lo ABSTRACT ad ju y th LIST OF TABLES yi LIST OF FIGURES pl ua al CHAPTER 1: INTRODUCTION n 1.1 Research background n va ll fu 1.2 Research problem m oi 1.3 Research objectives 10 nh at 1.4 Scope of study 10 z z 1.5 Thesis structure 11 ht vb k jm CHAPTER 2: LITERATURE REVIEW AND HYPOTHESES 12 l.c gm 2.1 Employee satisfaction 12 2.1.1 Definition of employee satisfaction 12 om 2.1.2 Employee satisfaction and its dimensions 13 an Lu 2.2 Previous research about employee satisfaction and identifying hypotheses th ey 2.2.3 Management system 16 t re 2.2.2 Work environment 15 n 2.2.1 Salary and Benefits 14 va in this study 14 t to ng hi 2.2.4 Career progression 17 ep 2.2.5 Supervisor support 18 w n 2.2.6 Moderated variable: Bank type 19 lo ad ju y th 2.3 The research model 20 CHAPTER 3: RESEARCH METHODOLOGY 21 yi pl ua al 3.1 Research process 21 n 3.2 Measurement scale 22 n va 3.3 Qualitative pilot research 24 ll fu oi m 3.4 Quantitive research 25 nh 3.4.1 Sample size 25 at z z 3.4.2 Data collection 26 vb k jm ht 3.4.3 Data analysis method 26 l.c gm 3.5 Conclusion 29 CHAPTER 4: DATA ANALYSIS 30 om 4.1 Sample descriptive statistics 30 an Lu 4.2 The reliability test: The Cronbach’s Alpha Test 31 n va 4.3 Exploratory Factor Analysis 33 ey t re 4.4 Hypothesis testing 35 th 4.4.1 Pearson Correlation Coefficient 35 4.4.2 Testing assumptions of multiple regression 35 t to ng hi 4.4.3 Regression analysis 36 ep 4.4.4 Chow Test for moderating variable 40 w n 4.5 Discussion of research findings 45 lo ad ju y th 4.6 Conclusion 46 CHAPTER 5: CONCLUSIONS, IMPLICATIONS AND LIMITATIONS 48 yi pl ua al 5.1 Conclusions 48 n 5.2 Managerial Implications 49 va n 5.3 Limitations and recommendations for future research 51 ll fu oi m REFERENCES 52 nh APPENDIX 58 at z z k jm ht vb om l.c gm an Lu n va ey t re th t to ng hi ep ACKNOWLEDGEMENT w n First of all, I would like to express my sincere gratitude to my supervisor Dr Dinh Thai lo ad Hoang, who offered his continuous support and useful advices throughout the course of y th this thesis His guidance helps me over the time of research and writing this master thesis ju yi Secondly, I would like to thank the ISB Research Committee for their encouragement and pl ua al valuable comments n Last but not least, I am thankful to all my colleagues, friends for the consultation and n va support during my research process ll fu oi m at nh z z k jm ht vb om l.c gm an Lu n va ey t re th t to ng hi ep ABSTRACT w n This study aims to determine the different impacts of five independent variables (Salary lo ad & Benefits, Work environment, Management system, Career progression and Supervisor y th support) on dependent variable, employee satisfaction in the Vietnamese banking ju industry, and explores the moderating role of the bank type variable on these yi pl relationships A survey was conducted by utilizing a sample of 171 employees working in al ua both local and foreign banks in Ho Chi Minh City Multiple regression and Chow Test n were used to analyze these impacts on employee satisfaction as well as compare those n va effects between two groups ll fu oi m The result indicates that all determinants which are Salary & Benefits, Work environment, Management system, Career progression and Supervisor support positively nh at influence employee satisfaction Career progression and work environment are found to z be the most important factors Furthermore, the analysis results also support that the bank z ht vb type moderates the relationship between these factors and employee satisfaction jm Accordingly, in the local bank type, career progression still has the strongest effect on k employee satisfaction, whereas, work environment has the highest impact on employee l.c gm satisfaction in the foreign bank type om Based on the statistical results, managerial implications have been discussed and industry in Ho Chi Minh City an Lu recommendations are provided to enhance the employee satisfaction in the banking n va Keywords: Employee satisfaction, salary & benefits, work environment, management t re ey system, career progression, supervisor support th t to ng hi LIST OF TABLES ep Table 3.1: Measurement scale 22 w Table 4.1: Descriptive Statistics 30 n lo ad Table 4.2 Reliability Statistics of Salary & Benefits variable 68 y th Table 4.3 Reliability Statistics of Work environment variable 68 ju Table 4.4 Reliability Statistics of Management system variable 69 yi pl Table 4.5 Reliability Statistics of Career progression variable 70 al ua Table 4.6 Reliability Statistics of Supervisor support variable 70 n Table 4.7 Reliability Statistics of Employee Satisfaction variable 71 n va ll fu Table 4.8: KMO and Bartlett’s Test 33 oi m Table 4.9: Total Variance Explained 72 Table 4.10: Rotated Component Matrix 73 nh at Table 4.11: KMO and Bartlett’s Test for employee satisfaction 34 z Table 4.12: Total Variance Explained for employee satisfaction 34 z ht vb Table 4.13: Pearson Correlation Coefficient 74 jm Table 4.14: Coefficients 75 k Table 4.15: Variables Entered/Removed 36 gm Table 4.16: Regression analysis 37 l.c Table 4.17: Hypothesis testing results 38 om Table 4.18: The summary of hypotheses testing results 39 an Lu Table 4.19: Regression analysis for local bank 41 ey t re Table 4.22: Coefficients (foreign bank) 43 n Table 4.21: Regression analysis for foreign bank 43 va Table 4.20: Coefficients (local bank) 42 th Table 4.23: Differences of impact of determinants on employee satisfaction by bank type 44 t to ng hi LIST OF FIGURES ep Figure 2.1: Research model 20 w n Figure 3.1: Research process 21 lo ad ju y th yi pl n ua al n va ll fu oi m at nh z z k jm ht vb om l.c gm an Lu n va ey t re th t to ng hi Chapter ep INTRODUCTION w n This chapter provides background information on the nature of the present study and its lo ad objectives It consists of four sections The first section introduces the background of the y th research, the second and third part present the research problem, and the final section ju yi present the scope of study pl Research background ua al 1.1 n In present, along with the globalization, increasingly competitive markets, organizations va n are forced to offer their best products and services to customers Therefore, delivering the fu ll premium service quality plays a critical role on the service providers’ success and m oi survival In addition, some papers point that high service quality results in customer at nh satisfaction and loyalty, greater willingness to recommend to someone else, decrease in complaints (Bitner, 1990; Danaher, 1997; Headley and Miller, 1993) z z ht vb With regard to such a service business line as banking employees are the service jm providers in the banks The performance of a bank depends not on the various k services/products it launches, but on the employees who provide those services to the gm customers In order to enhance the productivity and profitability of the bank, the l.c performance of employee should be considered Therefore, huge interest has been gained om by organizations as well as researcher to examine factors that foster employee satisfaction an Lu and it and became a critical issue within the last two decades (Matzler and Renzl, 2007) In service industry, specifically the banking sector, service employees are often n va representatives of the whole bank and are vital to sharping customer’s perception of t re ey service quality (Hartline and Ferrell, 1996) a financial intermediary to channel those who have capital surpluses to those who have capital deficits Bank also provides a variety of services such as payments and th Business dictionary defined bank as an establishment authorized by a government, act as t to ng hi collections, funds transferring and foreign exchange dealing Take a closer look at the ep Vietnam economy, banking industry is the heart of the economy and is at growth stage of w its cycle life According to the report of VietinbankSc, the industry’s contribution to the n lo economy grew from 2008 to 2012 In just a few years recently, the whole banking ad industry has been developed remarkably and plays a significant role in Vietnamese y th economic structure As of 2013, the whole banking system includes: state-owned ju yi commercial banks, 35 commercial banks, fully foreign-owned banks, 11 foreign banks pl have investment in Vietnamese banks, 54 foreign bank branches, 04 joint venture banks, al n ua 17 financial firms, 12 financial leasing companies and nearly 1,100 credit funds The va appearance of a lot banks makes the banking industry in Vietnam intensively n competitive, each bank tries its best to set up the wide network branches that leads to the ll fu increase in the number of bankers at nh Research problem oi m 1.2 A global economic crisis in 2008 has affected negatively the entire Vietnamese economy z z as well as the banking industry As the report of VietinbankSc in November 2013, over vb jm ht 60% enterprises reported negative net income and the profit after tax of commercial banking industry in Vietnam declining from VND47 trillion to VND36 trillion (as of k gm 2012) In 2012-2013, the State bank of Viet Nam restructured the banking industry by l.c making a series of large-scale M&A deals of nine commercial banks because of their om weak operation and management (SCB, Ficombank, TinNghiaBank, Habubank, an Lu Tienphongbank, GP Bank, Navibank, TrustBank and Western Bank) Besides, the other banks have suffered from the downtrend of economy and forced to cut expenses by va dismissing employees, salary’s reduction… n period th DongA bank laid off 168 employees as well as SHB also dismissed off 100 jobs in this ey workers and cut the salary for employees by 31.65% in the first quarter of this year t re Based on the report of Vietnam News in May 2014, Exim bank has slashed nearly 500 t to ng hi Appendix B: Questionnaire (in English) ep Dear participants, w n I am a member of Master of Business Class, a Master Program in English of University lo ad of Economics Ho Chi Minh city At the present, I have been doing a research to identify y th some factors that impact on employee satisfaction in the banking industry Participant in ju this survey is voluntary and no individual data will be reported Please indicate the extent yi pl of your agreement or disagreement with each statement by circling a number from to n ua al Rating scale: Strongly agree n ll fu My company has good salaries systems My company has good retirement systems I feel that my job is secure I am satisfied with amount of health care paid for I am satisfied with amount of vacation I received at nh 7 7 7 z l.c oi ht m Salary & Benefits va Strongly disagree z vb jm k for my benefit package gm Work environment I am provided materials & equipment to job om well an Lu Provision of educative and training environment Provision of abundant resources & advanced 7 ey information t re n My physical working conditions are good va th Management system 10 My company has fair promotion systems 11 My company has good management systems 61 t to ng hi 12 My company has a clear system of rewards and ep 7 I have a clearly established career path at this penalties n Provision of high quality service processes lo 14 My company has smooth communication channels w 13 ad Career progression yi company ju y th 15 pl I have opportunities to learn & grow 17 I have achieved or I will achieve the level or 7 n ua al 16 va position I had hoped to achieve fu My supervisor helps his/her team members identify ll 18 n Supervisor support oi m and develop their skills and potential 20 My supervisor deal effectively with multiple 7 l.c at My supervisor celebrates his/her team’s successes ht nh 19 z z My supervisor make timely decisions, without k unnecessary delay jm 21 vb demands and conflicting priorities gm 22 My supervisor demonstrates high ethical standards 23 My supervisor treats me fairly and with respect 4 work I am satisfied with the company’s management 7 om Employee Satisfaction 25 I satisfied with the company’s 7 I am satisfied with the company’s th 27 ey system t re 26 n environment va I am satisfied with the company’s pay and benefits an Lu 24 am career progression 62 t to ng hi 28 I am satisfied with the company’s supervisor ep 7 support Overall, I am satisfied as an employee of this w 29 n lo company ad Demographic questions yi  Male ju y th Gender: pl  Female al n ua Age: n va  40 nh at Bank types: z ht vb  Foreign bank z  Local bank k jm Tenure: an Lu  >5 years om  – years l.c  – years gm 