Managerial competencies of middle managers at petrovietnam finance corporation pvfc

INTRODUCTION

RATIONALE

The long-term objective of PVFC is becoming one of the greatest financial institutions in Vietnam in 2020 To make this long-term purpose come true, PVFC has to set up a range of main objectives as below:

- Improving the Human Resource Management strategy;

- Becoming a top profit gaining financial institutions in Vietnam;

- Becoming a prestigious partner of foreign companies;

- Contributing the most for the community by many social and charity activities.

The role of Middle managers in PVFC

Middle managers’ role is a like bridge connecting the executive managers and the employees to implement all the tasks in the best way Middle managers in PVFC are the key force that interpret and represent all tasks to staff, monitor and help the employees to make the work is done effectively.

Restrictions of Middle managers at PVFC

Managerial competencies of Middle managers at PVFC do not satisfy the needs of work. Therefore, some requirements that the top managers have requested were not implement sufficiently As the results, the staff misunderstood the tasks that they were given by the top managers so some objectives were not archived

This problem has been gaining more attention of the Board of management of PVFC. Being aware of this, I would like to choose this topic: “Managerial competencies of

Middle managers at Petro Vietnam Finance Corporation (PVFC)” to study with a desire that could recommend some solutions for effective working performances ofMiddle managers to encourage their contribution to the corporation.

RESEARCH QUESTIONS

Based on the framework of this thesis, there will be four questions with regard to the Middle managers’ managerial competencies as below:

- What are required managerial competencies of the Middle managers to implement their jobs effectively at PVFC?

- What are current managerial competencies of the Middle managers at PVFC?

- Are there any gaps between current managerial competencies and required managerial competencies of Middle managers at PVFC and what its causes?

- How to improve managerial competencies of Middle managers at PVFC to implement their jobs effectively?

RESEARCH OBJECTIVES

This research will follow those main objectives:

- Identifying the managerial competencies needed of Middle managers to implement their jobs at PVFC;

- Analyzing the current managerial competencies of the Middle manager at PVFC;

- Defining the gaps between the required competencies and the current competencies of Middle managers at PVFC;

- Recommending some solutions to restrict and reduce the gaps.

RESEARCH METHODOLOGY

The research methodology could be summed up as the chart below:

In this thesis, both secondary data and primary data are used for identifying required managerial competencies and current managerial competencies of Middle managers at PVFC.

On purpose to guarantee the quality and quantity for the research, following is the methods shall be applied for collecting data.

1.4.2.1 Secondary data: will be collected from PVFC’s reports, policies, regulations, labor agreement, brochures… from 2007 to 2009 Moreover, the author also collected data from newspaper and Internet to generalize the past and the current condition as well of PVFC.

PVFC middle managers’ job analysis

1.4.2.2 Primary data : will be collected from two ways: interview and questionnaires survey

 In-depth interview: were implemented with all the top managers of PVFC about requirements of managerial competencies to reach company’s objectives and strategies. ( Quantity: 6 Top managers)

According to their requirement of managerial competencies, the author designed a list which contains required components of managerial competency to make an assessment model.

In fact, the author conducted six interviews with six top managers of PVFC Besides, the author brought along a record to record the whole interview for later analysis.

 Questionnaires survey: The survey had the guidance based on the Top managers’ requirement of managerial competencies for Middle managers The questionnaires survey was used to people of the company as following:

 For Middle managers at PVFC: to allow them judge themselves by giving points for themselves in each components in the guidance (Quantity: 36 Middle managers);

 For subordinates of Middle managers: These subordinates directly work with Middle managers and follow the directions, orientations of Middle managers They can give them mark for each component of managerial competency as mentioned in the guidance of the survey (Quantity: 108 employees).

With all the information collected from interviews, questionnaires survey and using quantitative and qualitative measure methods to evaluate, the author will use MicrosoftExcel, SPSS software to analyze information.

RESEARCH SCOPE

Object: managerial competencies of Middle managers

Location: Hanoi Head Office PVFC

RESEARCH STRUCTURE

This part provides a brief information about researching purpose, findings and conclusion of the thesis It gives readers an overview of the research.

In this chapter, the readers can understand the reasons why the thesis focuses on the managerial competencies of middle managers at PVFC Then it clarifies objectives of the thesis, and main question need to be addressed Research methodology with a log-frame of the research will help readers understand the whole researching process.

Chapter 2: Theoretical Framework on managerial competency

This chapter presents briefly selected theories about managerial competency; those are used as a background for the research It clarifies the terms about competencies and managerial competencies then builds up a competency models for the research.

Chapter 3: Analyze the required managerial competencies of Middle managers at PVFC

This chapter provides introductive information about PVFC and requirements of top managers for middle managers about managerial competencies It also presents methodology to get the requirement from top managers, including job analysis, in-depth interview and questionnaires.

Chapter 4: Analyze the current managerial competencies of Middle managers at PVFC

This chapter provides result assessment on current managerial competencies of the middle managers at PVFC The methodology is also described to help the reader understand more clearly about the current managerial competencies of middle managers at PVFC.

Chapter 5: Recommended solutions to improve Middle managers’ managerial competencies at PVFC

This chapter presents author’s recommendations about how to bridge the gaps between required and current competencies of middle managers at PVFC

References: This part names books, magazines, articles…were referred for the research. Appendix: This part presents questionnaires used in the research.

THEORETICAL BACKGROUND ON MANAGERIAL COMPETENCY

COMPETENCY AND MANAGERIAL COMPETENCY OVERVIEW

2.1.1 Definition, components and analysis process of competency

It is interesting that the term “competency” was used first by a psychologist However, till 1990s when Furham clarify it by giving an explanation:

“The term competence is new and fashionable, but the concept is old Psychologists interested in personality and individual differences, organizational behaviors and psychometrics have long debated these questions of personality traits, intelligence and other abilities”

From that on, there are hundreds of definitions of competency, but all of them carry general or rather specific meanings depend on the context and the objective of the research So people might be confused when finding lots of different definitions For example all of us can recognize and give our own definition for competency, we just consider ‘competency’ as something within a person or a group of people It contains variety of internal factors those help to work efficiently and get a goal In life, we usually call someone competent or incompetent depending on how confident we are on that person to give us satisfactory results And another thing that we cannot deny that competency is not always the same It could be improved and could also be gained by learning and practicing in work and life.

As time passed by it has arisen the necessary for the brief and clear definition of competency, these days a definition that we usually use says:

“Competency is the standard requirement for an individual to properly perform a specific job It encompasses a combination of knowledge, skills and behaviors utilized to improve performance.”

One of the first and important definitions of competency was created by Collin in 1989.

He believed that competency is shown in action, in a condition, in a situation that might be different the next time you have to act In emergency contexts, competent people will react to the demanding situation following behaviors they have previously used to be successful with a hope to have a good effect Therefore, to be competent you need to be able to interpret the situation in the context and to have repertoire of possible actions to take and have been trained in the possible actions in the repertoire, if this is relevant

Source: http://www.imsglobal.org

There are some more brief definition from some different research, for instance, according to Bernard and David Stringer, competency includes skills, knowledge, behaviors and attitudes of a person to fulfill a task Besides, research of Tuckey and Cofsky indicated the definition for competency as: an underlying characteristic of an employee, for example, a motive, trait, skills, aspect of one’s self image, social role and a body of knowledge which result in a performance of him Or according to the New York Public Affair Service and the Labor Relation Office, competency is concerned as traits, character of a person, which result in his/her performance and contributes to the organizational objective The competency, therefore, includes: Knowledge, skills, abilities and other factor as value, motive, initiative and self control

Nowadays, the term ‘competency’ is then used widely for organization, called

‘organizational competency’ It is not simply add single competency of all people inside the organization It is a result of interaction of all the single competencies inside the organization, so it could be weaker or much stronger than the result of simply adding single competencies inside the organization.

Competency, as mentioned above, is a complex of so many factors and varies from one company to others, even from one division to others in one company However, I think that the italic definition about competency above is the most brief and appropriate to apply in many situations Basing on this, I would like to use definition throughout my thesis.

Knowledge is theoretical or practical understands about subjects or events Knowledge is gained through learning or experiencing It is expertise and skills acquired by a person through experience of education It is what is known in a particular field or in total; facts and information or awareness or familiarity gained by experience of a fact or situation.

Knowledge acquisition involves complex cognitive processes: perception, learning, communication, association and reasoning The term knowledge is also used to mean the confident understanding of a subject with the ability to use it for a specific purpose.

In glance, it refers to a context of information relevant to job performance such as before performing a job we have to have knowledge of policies and procedures For trade and service staffs, knowledge is perception about domestic and international business, economic trends, competitors, service process, national and international laws, regulations…

Looking at the term ‘Skill’ from some examples such as: Academic skills (Reading; Logic; Critical Reasoning); International communication (Speech, listening, Talking nonverbal communication); Literacy: (Writing, Reading); Innovation Skills… we can see

‘Skill’ usually requires certain environmental stimuli and situation to be accessed the level of it People especially in our modern society today need to a broad range of skill to find a job And according to a recent study, skills of employees have to follow the change of technology and workplace.

In the domain of work, some general skills would include time management, teamwork and leadership, self motivation and others, whereas domain-specific skills would be useful only for a certain job.

In the managers’ point of view, skill is also the practice of understanding Well- implemented skills management should identify the skills that job roles require, the skills of individual employees, and the gap between two of these.

Abilities refer to talents of people It may contain manual dexterity, visual and conceptual thinking Sometime it is called as personal characteristics include traits, motives, values, attributes, and many others…Inside abilities, attitude plays a very important role, as it decide effectiveness of almost other factors.

Attitudes are composed from various forms of judgments The affective response is a physiological response that expresses an individual’s preference for an entity The behavioral intention is a verbal indication of the intention of an individual The cognitive response is a cognitive evaluation of the entity to form an attitude Most attitudes in individuals are a result of observational learning from their environment.

MANAGERIAL COMPETENCIES

“Management” (from Old French - ménagement “the art of conducting, directing”, fromLatin - manu agere “to lead by the hand”) characterizes the process of leading and directing all or part of an organization, often a business, through the deployment and manipulation of resources (human, financial, material, intellectual or intangible)… This management definition is interesting because it traces the root meaning back to the Latin phrase meaning “to lead by the hand” Leading by the hand implies giving direction that is stronger than just a passing suggestion yet still fairly gentle in approach Leading by the hand also implies that the person doing the leading is first going where the follower is being lead The leader is not asking the follower to do something he is not willing to do himself.

This implies that, for management to be effective there needs to be some type of defined approach or system in place This system becomes the plan and management is guiding others in following that plan This is often the downfall of managers They have no plan or system As a result their actions seem random to the people they are managing and this leads to confusion and disappointment This is why it is so important for business managers to have an employee manual Without the employee manual providing direction, managers will struggle to be fair and balanced in their dealings with employees. Thus, the main activities involved in managerial functions are:

Planning is a mental process requiring foresight and sound judgment It involves the laying of objectives and determining the course of action to achieve the objectives. Objectives have to be clarified before taking any other decisions They provide the basis for the future and for evaluating the performance with the pre-determined standards. Planning is based on future situations and is a must at all levels of management The success of a plan, therefore, lies in the manager’s ability to forecast future situations correctly and accurately Thus planning implies, deciding in advance what, when, where to do and how the results are to be evaluated Planning is a continuous process It is required to ensure effective utilization of human and non-human resources to accomplish the desired goals The process of planning thus involves the following activities:

(3) Searching alternative courses of action

(4) Evaluation of various alternatives and formulation of a plan

(6) Preparing schedules, programs and budgets.

Once planning is effected, the people in the organization have to be organized It is an important activity by which management brings together the manpower and material resources for the accomplishment of pre-determined goals Organizing is the process of establishing relationships among the members of the organization This relationship is created in the form of authority and responsibility Each member in the organization is assigned a specific duty to perform and is granted the corresponding authority to do it In the words of Louis A Allen, “Organization is the process of identifying and grouping the work to be performed and dividing it among the individuals and creating authority and responsibility relationship” among them for the accomplishment of objectives” The process of organizing thus involves the following activities:

(1) Identifying the activities involved in achieving the objectives

(1) Grouping the activities into a logical pattern

(2) Assigning the activities to employees

(3) Delegating authority and fixing responsibility

(4) Coordinating the authority-responsibility relationships of various activities.

This part is considered as a separate function in view of the need to employ the right types of people and develop them for the well being of the organization Thus staffing involves manning the positions created by the organization process It is concerned with the human resources of an organization In the words of Harold Koontz and Cyril O’Donnell, “The managerial function of staffing involves manning the organizational structure through proper and effective selection, appraisal and development of personnel to fill the roles designed in the structure” Staffing function, thus involves the following:

(1) Manpower planning, i.e determining the number and the kind of personnel required

(3) Selection of the most suitable personnel

Controlling is the process of seeing whether the activities have been performed in conformity with the plans It helps the management to get its policies implemented and to take corrective actions if performance is not in accordance with the planned objectives In the words of E.F.L Brech, “Controlling is the process of checking actual performance against the agreed standards with a view to ensuring satisfactory performance” The process of controlling thus involves the following:

(1) Determination of standards for measuring work performance

(3) Comparing actual performance with the standard

(4) Finding variance between the actual with the standard and the reasons

(5) Taking corrective action to ensure attainment of objective

These functions are so interlinked, that in actual practice it is not possible to separate them from another Planning provides the leases for control and control gives meaning to planning An efficient system of control helps to predict deviations well in time and to initiate corrective steps before the loss occurs.

Commanding is otherwise called management in action It is concerned with the actuating of the members of the organization for the accomplishment of the enterprise goals. Commanding thus involves issuing instructions (or communication) to subordinates, guiding, motivating and supervising them.

2.2.2 Managerial competencies of middle managers

Managerial Competencies which are considered essential for staff with managerial or supervisory responsibility in any service or program area, including directors and senior posts.

Some managerial competencies could be more relevant for specific occupations, however they are applied horizontally across the Organization, i.e analysis and decision-making, team leadership, change management, etc.

Managerial Competence is the ability for managers and leaders to direct work streams and define outcomes clearly Competence refers to both the ability (technical/certified) and the inferred ability (acceptance by those who are managed).

Components of managerial competencies are briefly mentioned below:

 Strategic thinking and Scenario-building

- Be sensitive to wider political and organizational priorities;

- Explore and understand trends, opportunities and risks that could affect services, programs, functional areas of jobs;

- Forecast and integrate different views;

- Design alternative scenarios and business models.

 Analysis, Problem -solving and Decision making

- Take care of macro and long-term consequences of decisions;

- Have courage to take effective decisions.

- Design comprehensive and realistic plans using strategic goals;

- Act on future needs and take advantage of opportunities;

- Assess adequate level of resource and organize them in a timely manner;

- Balance day to day demands with planning efforts;

- Monitor plans and take corrective action as required;

- Organize that things are done logically, clearly and well;

- Encourage and produce change in self and others;

- Create conditions and processes to support change;

- Sustain change, balancing people, financial resources; technology and processes;

- Develop an environment in which others can express themselves and act without fear;

- Balance distribution of tasks and resources;

- Establish in a participatory process-group and individual objectives;

- Take ownership of all responsibilities and honor commitments;

- Involve staff in different steps of the management process;

- Value other’s initiatives and expertise;

- Manage stress in self and others;

- Evaluate performance and deal with motivational issue.

- Use relevant components of managing small group;

- Channel effectively inputs or ideas from different organizational layers;

- Delegate proper level of authority to other layers;

- Encourage units to set challenging goals;

- Build appropriate organizational performance and monitoring systems;

- Operate in compliance with best organizational practice.

- Build effective teams recognizing individual contributions, cultural factors and organizational context;

- Conduct effectively different types of teams/task forces;

- Motivate self and team members for results;

- Instill team agenda before personal/individual interests;

- Encourage dialogue and act in accordance with team inputs;

- Anticipate and resolve conflicting differences by pursuing mutually agreeable solutions;

- Give proper credit to others;

- Participate effectively in cross-organizational activities.

- Define indicators and organize cost-effective information schemes;

- Identify reliable sources of pertinent information;

- Use quantitative and qualitative information;

- Provide appropriate and timely information to clients (internal/external);

- Keep abreast of emerging changes of information technology in functional area;

- Actively seek to apply information technology to appropriate tasks.

- Discover and find new ways of doing things;

- Stay abreast of new theories, trends or developments;

- Actively seek to improve programs and services;

- Obtain results with different means;

- Encourage others to look for new ideas or approaches;

- Improve on traditional ways with more effective action.

- Present and propose alternative ways to others;

- Reach solutions to satisfy fundamental objectives;

- Arrive at constructive solutions while maintaining positive working relationship.

- Share wisdom and professional expertise with others;

- Be engaged regularly in professional exchanges;

- Assess accurately individual strength and development needs;

- Give specific and timely recognition;

- Provide feedback on actual behavior;

- Guide and support on performance, career or succession trends.

- Set up or organize meeting facilities;

- Obtain the best from the group;

- Guide the group in obtaining concrete results.

- Speak clearly, concisely in public;

- Use appropriate audio and visual technology;

- Carry self well in front of a large audience;

- Make a self assignment after performance for future improvements.

- Define interview purpose and prepare plan;

- Find relevant factual information and identify personality traits;

- Participate effectively in panel interviews;

- Apply effective competency-based recruitment and selection procedures;

- Use constructively during investigation processes.

INTRODUTION OF PETRO VIETNAM FINANCIAL COPORATION (PVFC) 32 1 Overview

PVFC has long been the backbone financial institution of Petro Vietnam (PVN) The firm’s key tasks consist of capital arrangement and providing diverse financing solutions for PVN’s projects and other partners within and outside the Oil and Gas industry.

Over 10 years of development (2000-2010), PVFC’s chartered capital has reached VND 5,000 billion, in which, 78% of shares are held by PVN, 10% is held by an international strategic shareholder, Morgan Stanley (MSIHI), other shares are held by other private domestic shareholders Being one of the first non-banking institutions entering the market, PVFC has grown stronger and stronger with a dynamic, innovative and enthusiastic workforce of more than 1,200 employees who are qualified, well-educated and possessing solid understanding of the financial and energy industry By August 2010, the firm’s operating network has embraced 10 branches, 15 transaction offices all across the nation and four subsidiary companies operating in the field of financial consultancy, investment, securities and fund management.

With the aim of becoming one of the leading finance and banking corporations in the energy sector, beside, the company continues committing its role as a crucial financing arm of PVN PVFC has established intimate and efficient relations with various foreign and domestic banks and credit institutions; become main coordinator helping to arrange capital, provide credits and satisfy the financial needs of PVN and its subsidiaries to carry out different investment projects to keep up with the progress and to assure the developing requirement of the Oil and Gas industry.

Chart 3.1: PVFC’s Share Holder Structure

With a profound knowledge and deep understanding of the monetary and financial market, PVFC offers clients a variety of short-term capital source services via term valuable-notes purchase, repurchase agreements (repo), forward and options. Furthermore, PVFC has long been a reputable advisor to successfully assist clients within and outside the Oil and Gas industry in underwriting bonds for corporate and organization fund raising, with a variety of service packages of consultancy, underwriting, factoring, supplying, purchasing, selling and market creation.

On the other hand, PVFC has expanded and emphasized developing package products and services of corporate lending, investment, financial advisory, particularly, M&A (Mergers and Acquisitions) Many innovative products of PVFC were created and launched in turn that have become the featured products, contributing to the distinctions of PVFC on financial and monetary markets, such as co-financing, trust fund management, trust investment, consulting and brokerage investment… Especially the Clean Development Mechanism projects – CDM (providing assistance in CDM project consultancy; financing for CDM projects; brokerage service in trading carbon credits), also PVFC is the leading advisor in trading CERs in Vietnam

As a proof of the company’s maturity and quality of service when PVFC engages operating in the carbon credit market, on 10th May 2010, PVFC was successfully organized the first contract auction that transfer a number of CERs issued to Rang Dong CDM project, then the uniform and signed a variety of other CDM development contracts such as Project of acquiring associated gas and Gaslift for Rong – Doi Moi mine; Biothanol manufacturing factory in Phu Tho, Dung Quat, Binh Phuoc

Not only intensively investing in industrial activities directly in the oil and gas industry, PVFC has been implementing activities that develop CDM in other potential areas outside the Oil and Gas industry, contributing to the orientation of the community in protecting the environment, use of renewable fuels and clean fuels towards sustainable development.

As in the development and network expansion strategy of PVFC, Can Tho branch has been an extended arm of PVFC in providing financial services for customers in the Mekong Delta The presence of PVFC in Can Tho has created an opportunity for individuals and businesses in the Mekong Delta region to have more choices of financial services and product providers

Chart 3.2: Credit Growth of PVFC from 2004 – 31/08/2008

As of July 2010, PVFC had successfully arranged funds for many national key projects in the Mekong Delta areas such as: Nhon Trach 2 Power Plant Project; Construction project of Long Phu 1 thermo-electricity plant; Block B O-Mon Project; LPG Cold storage Investment Project (PV Gas); Investment project of infrastructure and technical construction of Vi Thanh residential area (PVC); "Petroleum Village" project; Construction project of water plant in Duc Hoa III Industrial Park - Long An

Besides the day to day business operation, PVFC has well practiced its social responsibility, charitable activities in the Mekong Delta by giving supports, donating money and supplies for the poor; presented house of gratitude to families of the Revolution; paid visits and donated gifts of money for the victims encounter difficulties due to natural disasters, accidents in productive labor; granting scholarships of “PVFC – Lighten your hope” to underprivileged students, helping them have chances to continue their education Most recently, PVFC has co- operated with CIC8 to implement the “Petroleum Village Project” in the South of Can Tho, contributing a better living conditions for the staff in the industry.

With the motto: “Professionalism - Effectiveness - Transparency - Client Focus”, PVFC commits to provide the highest quality of service to customers to satisfy their financial needs PVFC will continue expanding its operating network, diversifies its services, seeking opportunities to contribute to the development of the Mekong Delta

PVFC’s structure is organized in compliance with following laws:

 Enterprise Law approved by Vietnam National Assembly and effective since 01/07/2006.

 Banking and Financial Institution Law approved by Vietnam Social Republic on December 12, 1997 and adjusted in 2004.

 PVFC’s charter approved by the first shareholder’s meeting on December 21,

2007 and accepted by State Bank of Vietnam.

Capital mobilization boomed in 2006 and 2007, including issuance of stocks and bonds. Presently, PVFC has issued bonds in VND and USD with one- to three-year terms.

Over 2005-2007, the monetary market fluctuated, with interest on the domestic and international markets showing wide variations, impacted by inflation, high competition amongst domestic credit and non credit organizations in capital raising, all of which negatively affected the capital mobilization activities of PVFC.

Table 3.1: PVFC’s Sources of Capital

Term deposits from other financial institutions 1,513,614 11,615,643 667.4% 384,952

Term deposits savings deposits, and other deposits 296,334 143,562 (51.5%) 275,012

Borrowings from other financial institutions 3,131,032 2,370,940 (24.3%) 4,049,900

Granted capital, trust investment capital and others 8,118,879 18,140,253 123.4% 29,660,470

3 Bonds and other debt instruments 665,215 2,192,285 229.6% 2,199,948

(Source: Company audited financial statements for 2007 and 2009, audited financial statement and financial statements until 31/12/2009.)

In the climate of an unstable capital market, PVFC actively applied a flexible interest rate policy in line with the supply/demand status in the market, improving the lending/ borrowing rate gap and the gap between branches These efforts combined with support from PVN in terms of long-term borrowing contracts at a favorable interest rate of capital utilization and improved the profitability of its business performance.

Table 3.2: PVFC’s Credit of Activities

1 Loans to other financial institutions 1,621,387 545,068 (66.4%) 0

2 Loan and advances to organizations and individuals 2,817,035 8,688,786 208.4% 19,052,315

(Source: Company audited financial reports of 2007 and 2009, and from 31/12/2007 to financial report at 31/12/2009)

Before interviewing, I prepare a draft list of questions to ask interviewees about required managerial competencies for Middle managers My interview questions contain many matters such as characteristic of performance of middle managers, working characteristic, working requirements and working environment of Middle managers, traits of task and future planning of company… All the questions were the opening ones They can help the Top managers express their own ideas, feelings and demands to complete the answers for each question.

And after asking six Top managers about required managerial competencies for Middle managers, I asked them to illustrate their ideas by using 5-mark scale to reflect how important the competency is and how necessary the Middle managers must have For example, if one Top manager believes that Knowledge is the required managerial competency that cannot be missed, he/she has to illustrate that how good they want their Middle managers have in term of this requirement If he/she wants the Middle managers have to have 4.5 mark for this required competency that means he/she wants Middle managers are very good at Knowledge (seeing the Graph 3.6)

ANALYZE THE CURRENT MANAGERIAL COMPETENCIES OF

RECOMMENDED SOLUTIONS TO IMPROVE MANAGERIAL

THE BASIC SOLUTIONS FOR THE HR

5.1.1 Setting clearly objectives and target for HR

We all know that, the assessment process starts when the employee and manager reach a mutual understanding of what needs to be accomplished If expectations are not clearly stated, mutually understood, and presented in measurable terms, performance will be difficult to evaluate Goals performance targets and standards criterions are tools by which job expectations can be expressed.

At PVFC, while goals and standards of performance are described and presented in form of working-plan, which they have set up period, they already have simple type of goals and standards for their performance.

While performance targets should be set and located for all staff for fixed period by manager base on the PVFC targets Most of respondents have no their monthly working- plan and monthly-report and they also realized that it is no necessary for measuring their performance The results show that there is no consistent regulation for setting working- plan and term-report as well as what they need to report.

The content of working-plan as indicated in the questionnaires seems a personal work schedule As a result, the report’s contents were very simple with summary of working process only There are not any evaluations about quality of work either assessment about the advantages/disadvantages or identify of problem and solution Therefore, their reports have poor value for both manager and employee to improve their performance and cannot contribute to the company mission. departments The consistent form of working-plan as well as the contents of report also should be established officially.

Head of each department have responsibility to build and locate the task for their staff base on the Company goal This activity should be considered as a major strategic planning When building working-plan, the manager should determine the Company’s objectives to define what changes are affect on their department and what they need to do in order to contribute to the Company’s current running objectives Basing on common objectives, managers assign employees to review and verify job goals and standards to meet the requirement.

The personal working-plan should be approved by the manager and should be directed (if any) to ensure that the employees understand their tasks and their goals clearly Planning means setting performance expectations and goals for individuals to lead them increase their efforts toward achieving organizational objectives through measurable, understandable, verifiable, equitable, and achievable performance elements and standards.

A performance target is a statement of results to be achieved It describes the conditions that will exist when the desired outcome has been accomplished, a period during which the outcome is to be completed and the resources the organization is willing to commit to achieve the desired result.

Target should be challenging but achievable and it should be established with the participation of those responsible for meeting them.

In general, goals apply more to managers and professional employees who engage in individualized plans/projects Targets are more common for staffs engaged in routine, repetitive tasks.

When employees participate in setting goals and targets, there should be no mystery about how their performance will be done Since goals and/or standards are the primary criteria by which performance will be measured, it is worth reviewing them.

Department/manager will review the employee’s performance targets and personal development plan for the year by using Performance Targets Template and Personal Development Plan.

The first major task is to set performance targets for staff The purpose of setting targets is to specify clearly the standard to which staff should perform the tasks set out in their job description This is particularly important when staff is new to their jobs, the function of the department has changed, or management has changed A performance target is a statement of what an employee should do:

To improve an administration’s performance in the current job;

To improve an administration’s contribution to the department’s performance;

To improve the department’s performance overall;

To prepare employees to take on further responsibilities.

5.1.2 Improvements of assessment criterion for Middle managers

A standard or appraisal criterion refers to ongoing performance criteria that must be met time and time again Like goals, they are most effective when established with the participation of those who must meet them Performance measures must be based on performance targets and appraisal criterions According to the respondents, criterions to measure performance should be:

 Frequently to administration’s work effort

 Stated in terms of current and desired performance

 Raised as soon as the desired performance is achieved results of the surveys and interviews, it is showed that the current PA for admin staff at PVFC is relatively limited to competency review and failed to look at the staff’s needs and their motivation Hence, the author proposes the method of PA for admin staff at PVFC with both criteria on competency and staff’s needs and motivations at their work. The following is the proposed PA form for admin staff at PVFC.

In order to better evaluate the staff performance as well as motivate them to work more effectively and efficiently, more criteria on staff’s work achievement assessment, behaviors and conduct, career development, (job, supervisor, and working environment) satisfaction levels, and personal development plans should be included in the Company appraisal form.

This proposed PA contents will bring about a more comprehensive appraisal on the staff in competency, motivation, and plan of staff rather than simply evaluation on staff’s competency as present With these proposed contents in the Company’s appraisal form,the PA activities can get the more comprehensive results and more accurate evaluations of its staff.

SPECIFIC TRAINING SOLUTIONS FOR MIDDLE MANAGERS TO MEET

Training is an usual solution for years This means the result of this solution is undeniable About the objectives of this strategy, it is not only to improve competencies of employees but also to equip them with continuous learning attitude With that attitude, people will seek chances for learning to cope with the changes in the future Based on the above objectives, the following training courses are suggested to be delivered to middle managers:

5.2.1 Training courses for Middle managers

As analyze the weak points of Middle managers at PVFC in the previous chapter, I would like to recommend the necessary courses for Middle managers at PVFC to minimize their

This courses are sorted by its importance and its necessary.

Table 5.1: Recommended training courses for Middle managers

1 Fundamental knowledge review 2 weeks / 16 hours

- Listen to lower subordinates’ ideas

- Transform given orientations to actions

- Gaining insight into other members

- Getting along well with others

Source: Author’s idea managers It does not mean that every Middle manager at PVFC must be trained in all courses Depends on each individuals and each weak point and lacking fields, the course is provided to help the individual fulfill his/her lack.

The more details of each course is going to be mentioned following:

- To supplement latest and needed knowledge about business and economics for the

Middle managers (for example, about new rules, laws, regulations, trends of the economy)

- To help Middle managers review their knowledge

- Encourage Middle managers to upgrade and strengthen their knowledge - Equip Middle managers with the readiness to the changes in the business environment They will be also trained to have a positive view on any changes.

 Main content of the course:

- This course provides fundamental knowledge about business and economics which can help Middle manager get the background knowledge for doing business.

- The course contains both academic and practical knowledge about business and economics The course is regularly updated the newest information and knowledge to provide the latest.

- In this course, there are times for discussions and arguments for the Middle managers express their own ideas and personal knowledge about related topics. that the way you act will determines whether you can cope with new situations or not. The root of your action is your feeling Negative reactions are based on fear or unsecured thinking from within Understand the basis of your fear and insecurities will allow you to develop strategies to neutralize their negative effects or you can react positively, then you can master the situations.

Top managers and their lower subordinates.

- To improve English ability of Middle managers to help them feel more confident in using and communicating with foreign partners and foreign Top managers.

- Provide some tips for Middle managers to communicate successfully with others, hints to work well in the position as a bridge.

- Presentation Skills: supplement to Middle managers many important skills and tips for presenting their ideas not only to their Top managers but also to their lower subordinates

- Using English in office: can help Middle managers obtain the essential knowledge and skills for reading, writing, listening and speaking English.

- Listen to lower subordinates’ ideas: This lesson helps Middle managers know how to listen to their subordinates’ ideas to take most advantages from subordinates.

- Besides, there are many outside activities for Middle managers to practice communicative skills such as: picnics, doing some short journeys…

- Improve Middle managers’ skills of receiving orientations from their Top managers.

- Increase the effectiveness and productivity of Middle managers’ assigned work by helping them succeed in receiving and transferring orientations to ideas, commands and actions.

- Reduce the time for consultation, meeting and re-orientation between Middle managers and Top managers.

- Generate the ideas: Provide Middle manager tips to reduce the time for generating ideas. Moreover, Middle managers could also know how to interpret orientations, commands to their subordinates.

- Transform given orientations to actions: The skills for Middle managers to make orientations into actions effectively and correctly.

- To equip Middle managers with creative thinking of events It helps them change the conservative way of thinking from inside It will be helping them to foster creativities in the organization.

- To teach how to brainstorm exercises, arguments that can help Middle managers overcome long-standing problem

- Recognize the nature of the events, conditions which attempt to use creative problem- solving techniques to get the positive results.

- Analyzing Risks: Provide skills for recognize which is the best way to do the work This also means the ability to analyze that which option will bring about more profits.

- Creating ideas: Tips for Middle managers to revive their brain, always keep their brain new and fresh Help them to listen to others ideas then manage, change them to fit with the different situations.

- Overcoming Pressure: Help Middle manager maintain a strong, determine and calm thinking to solve and overcome pressure in work.

- Improve effective management skills for Middle managers

- Improve social interactive skills for Middle managers (in particular, interactive skills to work with subordinates and manage them successfully.

- Latest knowledge and information about management

- Knowing your employees lesson: Tips to understand subordinates, their interests, their thinking, their weak and strong point, their personalities…

- Directing accurately: Being successful at professional job is not enough to ensure a success at management position The course starts with analysis of types of people, step, the course will provide skill to get things done by other people with the highest agreement from them.

- To help Middle managers figure out the way to integrate individuals in a team to improve effectiveness of working

- To provide Middle managers about tips and hints to get along with many people in a team and become a good team player

- To help unveil how to be success in managing a team, developing team And the most important thing, the learners will learn how to transfer team spirit to others within the organization.

- Building team spirit: This course provides learners the analysis of team characteristics, team behaviors, different teams and what is an effective team By putting learner through exercises, the course help unveil how to be success in managing a team, developing team.

- Gaining insight into other members: basing on interactions and face-to-face communication to understand each other.

- Getting along well with others: Provide examples and knowledge to get along well with others in a team.

- To improve motivation skill of Middle managers

- To encourage them change their habits if they are not suitable for working with others and motivating others.

- To enhance the relationship among members in the corporation.

- Improving EQ: Start with differentiation between EQ and IQ, the course helps learners understand why EQ play more important role in management than IQ By pointing out show how to improve social interactive skills through EQ development

- Effective responses: The course will help learners understand and practice to improve motivation skill That will contribute much in the effectiveness of the management work.

SUPPORTIVE SOLUTIONS FOR MIDDLE MANAGERS TO MEET THE

All the mentioned training courses need to be conducted in 1-2 years at average 1 course/

2 months While conducting courses, the order should start from psychological issues to help build learners’ inspiration on learning to improve When most of middle managers recognized the need and are ready for improvement, the improvement, the courses on skill and knowledge will be delivered.

For the best result, training needs to be organized both in-door and out-door The outdoor courses focus on psychological objectives like: team working, continuous improvement attitude, readiness for changes…In return, the indoor courses focus on knowledge and skills At any course, activities and practicing should be mainly used to simplify the perception of the learners.

There should be a strategic training consultancy provider, who designs the whole training scheme But provider for specific courses need to be selected based on objective and selection criteria of each course.

5.3.4.1 Training policies and training procedure

The Corporation should maintain a clear budget for training and bring training into criteria for promotion Opportunities to training should be opened to every employees, but incentives and punishment scheme should be applied also Whoever applies for training,that fit to his/her career path could be considered and supported for that But if the need to be issued Besides, training procedure should be simple but effectiveness manageable.

5.3.4.2 Set up an internal training system

To keep the training activities active and at right scheme, an internal training system needs to be set up and empowered The coordinator should be in HR department with the link to training-in-charge person at other divisions/ departments This training system will be review every month on planning and on performance.

5.3.4.3 Building a continuous learning culture in the Corporation

In order to get real effectiveness of training activities, training need must originate from inside of people Top managers need to invest for training not only in verbal, but also in thinking and action Top managers need to take any suitable chances to encourage middle managers (and others) to improve their competencies, and continuous learning need to go into their heart.

My thesis concentrates on study the managerial competencies of Middle managers at Petro Vietnam Financial Corporation (PVFC) With the main objectives are to analyze the required and the current managerial competencies of Middle managers at PVFC, to identify the gap between required and current managerial competencies, and from that to recommend some solutions to bridge the gap.

The thesis research based on the 360 degree feedback assessment model but with different correspondents In in-depth interview, there were 6 Top managers as correspondents for the interview for building a set of needed managerial competencies for Middle managers. And then, they also took the questionnaire survey to judge the current managerial competencies of Middle managers In the next step, there are 34 versus 36 Middle managers took a questionnaire survey to assess their performances themselves And the last step is taken for the subordinates to evaluate their Middle managers by give them mark for each factors of managerial competencies.

After collecting and analyzing the data, the required managerial competencies of Middle managers were set up for assessment According to that, the required mark for each component of managerial competencies was given by Top managers By the time, the current managerial competencies of Middle manager at PVFC were consulted from three- side-assessment With the required and the current data which were received from research, the gap between the required and the current managerial competencies of Middle managers was identified and indicated as point (5-point-scale).

As a main purpose of the thesis, after identifying the gap, some recommended solutions were mentioned in the Chapter 5 The solutions cover from the HR changes and developments and the specific training course which needed to improve Middle managers’ competencies Besides, there are also some supportive solutions for the two main above solutions. would be a goof reference for improving Middle managers’ managerial competencies atPVFC, the author really wants to express her delegation to the new brilliant future ofPVFC And hopefully, Middle managers at PVFC would become more competent and contribute the best for the corporation.

1 Anderson, Performance Appraisal System – in B.Towers (1992) The Handbook of

Human Resource Management, 2 nd edition Oxford: Blackwell

2 Anthony W Perrewe P and Kacmar K (1999) Human Resource Management: A strategic approach, 3 rd edition Fort Worth: The Dryden Press.

3 Attorney Amy DelPo The Performance Appraisal System

4 DeCenzo D and Robbins S (1996) Human Resource Management, 5 th edition.

New York: John Wiley & Sons

5 Dibble Suzanne (1999) Keeping your valuable employees: retention strategies for your organization’s most important resource New York: John Wiley & Sons

6 Green, Paul C., “Building Robust Competencies: Linking Human Resources System to Organizational Strategies”, Jossey-Bass, 1999

7 Harrison (1993) Human resource management: Issue and strategies Pearson Education Limited

8 Lucia, Anntoinette; Richard Lepsinger, “ The Art and Science of Competency Models”, Jossey-Bass, 1999

9 Marchington and Wilkinson (1996) Core personnel and development The Institute of personnel and development, IPD House

10 NYS Department of Civil Service and NYS Governor’s Office of Employee Relations: Competencies: Report of the competencies workgroup”, September 2002

11 Raymon A.Noe, John R.Hollenbeck, Barry Gerhart & Patrick M.Wright (2005).

Human Resource Management Gaining a competitive advantage, 5 th edition.McGraw-Hill Irwin Publisher wanted to know about Competency modeling

13 Richard L.Daft & Dorothy Marcic Understanding Management, 4 th edition. Thomson South – Western Publisher

14 Richard S, Mansfield: “Building Competency Models: Approaches for HR Professionals” from the human Resource Management, spring 1996

16 United States Offices of Personnel Management: “Looking to the future: Human resources Competencies”, Sep 1999

20 http://www.pvfc.com.vn/

APPENDIX 1 – QUESTIONNAIR FORM FOR IDENTIFYING REQUIREMENT ON MANAGERIAL COMPETENCIES OF MIDDLE MANAGERS

This form is used for collecting data for a research on competencies of middle managers at PVFC Please circle on the suitable number next to each item in the table below Those numbers will represent your requirement on competencies of middle managers at

This form is used for Top managers only.

For future information, please contact

22 Ngo Quyen, Hoan Kiem, Ha Noi

- Knowledge of trade and economy 1 2 3 4 5

- Knowledge of domestic and international laws and practices 1 2 3 4 5

- Knowledge of product and service in particularly 1 2 3 4 5

- Keeps in touch with current thinking and based on corporate strategy and business need to determine personal action 1 2 3 4 5

- Has clear goals which focus on outputs and results 1 2 3 4 5

- Has a wide spread of contacts throughout the business and uses them to stay in touch with developments and requirements across the business

(5) = Extremely good: Posses an expert competence with many creativities in working This person is very good at training and coaching others;

(4) = Good: Can do the job professionally and independently This person can train and coach others;

(3) = Fine: Can do the Job skillfully by applies most of required knowledge and skills; however some motivation and/or supervision from seniors are still needed This person can guide others on the job;

(2) = Bad: Can apply only basic knowledge and skill to the job A lot of motivation and supervision are needed to get jobs done;

(1) = Very bad: This person can demonstrate a little or none of the required knowledge and skill to the job, regardless he/she is or is not aware of those

- Speak clearly and convey full information and easy to understand to listeners

- Speaking and writing skill in English when communication with foreign partners 1 2 3 4 5

- Listen and provide feedback promptly 1 2 3 4 5

- Share and exchange information and ideas with others 1 2 3 4 5

- Demonstrates a high personal motivation on achieve 1 2 3 4 5

- Regularly achieves high performance levels 1 2 3 4 5

- Actively strives to promote the development of new business opportunities 1 2 3 4 5

- Ensures that personal effort is focused on priorities 1 2 3 4 5

- Is able to make things happen 1 2 3 4 5

- Takes corrective action with a sense of urgency 1 2 3 4 5

- Generates commitments and efforts from others 1 2 3 4 5

- Encourages involvement and commitment of others 1 2 3 4 5

- Creates an enthusiastic environment in which team members are encouraged to make a full contribution 1 2 3 4 5

- Get the best out of people through understanding and responding to their aspirations and needs 1 2 3 4 5

- Use logical way to make decision or find solution for problem that finally achieve desired goals 1 2 3 4 5

- Use well-thought-out approaches to solve difficulties, persistent problems 1 2 3 4 5

- Effectively contribute to group problem solving 1 2 3 4 5

- Set clear goals and measurable objectives 1 2 3 4 5

- Assign clearly responsibility and accountability for tasks and decisions

- Delivery timely, positive feedback on accomplishments 1 2 3 4 5

- Review performance against goals to evaluate results 1 2 3 4 5

- Looks for ways to develop team members in their roles and 1 2 3 4 5

- Regularly reviews the development needs of team members against their objective and ensures that training is delivered effectively

- Provides regular feedbacks on achievement of personal and team goals

- Influences others as effective coach 1 2 3 4 5

MANAGERIAL COMPETENCIES OF MIDDLE MANAGERS

This form is used for collecting data for a research on competencies of middle managers at PVFC Please circle on the suitable number next to each item in the table below Those numbers represent your assessment on current competencies of middle managers at PVFC.

This form is used for top managers, middle managers and their subordinates.