Studying factors influencing employee turnover at setech

INTRODUCTION

Rationale

Research on human resources is essential, particularly studies that focus on employee turnover Understanding the reasons behind an employee's decision to resign is crucial for retaining talent and enhancing overall job performance within the company.

Employee turnover rates vary by country, organization, and department, highlighting the significant costs associated with high turnover Retaining top talent is crucial for companies aiming to secure a competitive edge in the market Consequently, attracting and retaining high-quality employees has become increasingly vital from a managerial perspective.

This research aims to assess the employee turnover rate at Setech, a startup supplying security systems to various sectors, including government entities and households By analyzing the factors contributing to the high turnover, particularly the trend of employees leaving within two years, the study seeks to understand the impact of this turnover on the company's overall performance.

According to yearly reports of Setech, the employees turnover rate at

Setech has experienced rapid growth since its founding in 2011, initially starting with just seven employees, thanks to support from various government entities However, shortly after its establishment, four employees left the company in search of new opportunities In 2012, Setech seized opportunities to collaborate with government agencies for hosting events and projects, leading to an increase in workload and further development.

Setech has expanded its workforce by hiring additional employees and creating new departments However, following the completion of each project, there has been a notable increase in employee turnover, with 7 out of 32 employees choosing to resign.

Chuyên đề thực tập Tốt nghiệp employees turnover in 2013, 2014, 2015 is 2 out of 37, 5 out of 46 and 8 out of

63, respectively In 2016, with the expansion of Setech venturing into Buon Me

Thuat, the company's leader, has made the strategic decision to hire additional employees, particularly collaborators, to enhance market expansion Despite this initiative, the company faced a notable challenge with employee retention, as 6 out of 98 employees resigned in 2016.

According to Ms Do Nhat Nga, founder and CEO of Setech, high staff turnover is a significant issue despite the company's profitability and relatively favorable working environment Employees typically leave after one to two years in search of better pay and stability This turnover is particularly detrimental in a company where engineers and procurement experts are crucial for product and service delivery, leading to a loss of personnel, diminished knowledge, lowered staff morale, and increased workloads For example, Setech has experienced setbacks when the departure of an experienced employee resulted in the loss of vital client contacts he managed.

Vietnamese Procurement Paper to publish information on newspaper and website.

However, with his resignation, Setech has to assign another employee to reach out and acquaint new contact In the context of the research, this thesis will further

“ Study factors influencing employee turnover at Setech ”

Research Objectives

The main purpose of this research is to point out significant objectives as follows:

●To systemize researches on employee turnover intention and factors influencing employee turnover intention.

●To identify the reasons that lead to turnover intention and employee turnover at Setech.

●To propose solutions to improve employee turnover intention at Setech.

Chuyên đề thực tập Tốt nghiệp

Research Questions

●What are the factor influencing turnover intention at Setech?

●How is the current situation of turnover intention and employee turnover at

●What are solutions and recommendations to reduce turnover intention and employee turnover at Setech?

Methodology

Propose a suitable framework based on existing study

Annual reports Other relevant reports

To make sure that the research can be reasonable and persuasive, the research uses both secondary and primary data.

Secondary data: I collected from different sources as follows:

- Setech’s Code of Conduct, Setech’s annual report, Setech’s employee profiles

- Related seminar and roundtable discussion documents.

This research will utilize primary data through two methods: quantitative surveys involving 73 current employees and qualitative in-depth interviews with 5 former employees.

Employees and former employees’ survey:

Respondent: Employees who are working or used to work at Setech.

Sample size: 73 current employees and 5 former employees of Setech.

The sampling method involved distributing questionnaires directly to current employees and emailing them to former employees After verifying the delivery status of these questionnaires, the researcher will follow up by requesting responses either through email or in-person meetings for collection.

- Questionnaires designs: In order to develop a suitable questionnaire, questionnaire design process includes four steps:

To effectively design a questionnaire, it is essential to first clarify its purpose by addressing key questions: What information is needed? Why is this information important? What outcomes are expected from the questionnaire? By answering these questions, the author can establish a clear objective, ultimately determining that the purpose of the questionnaire is to identify the factors influencing employee turnover at Setech.

+ Develop factors and subfactors influencing employee turnover: Based on the proposed factors influencing employee turnover developed by author, the author

The internship project team conducted interviews with the company's leadership and department heads to gather their insights on various subfactors within each category The feedback from these managerial discussions was recorded and refined to create an appropriate questionnaire Additionally, a similar questionnaire was developed for former employees, mirroring the one designed for current staff.

The pretest is a crucial phase in assessing the clarity of a survey, and in this thesis, the author selected five participants—three current and two former employees of Setech—to evaluate the survey's comprehensibility To mirror the actual survey distribution, three participants completed the survey in person, while two received it via email, printing it out to respond simultaneously During the process, participants were encouraged to verbalize their thoughts, allowing the author to document feedback and refine the survey accordingly As a result of this iterative process, five out of thirty statements were removed from the final version of the survey based on the testers' insights.

Many of the testers believed that these statements were not suitable, too direct or did not belong to the same topic as others.

- Questionnaires include three parts as following:

+Part 2: Survey on the working conditions, reward system as well as opportunity for development within Setech.

+Part 3: Questions regarding opinions towards factors influencing employee turnover.

The in-depth interviews are to learn through administration and department heads about former employees’ reasons to resign from positions in Setech and their

Chuyên đề thực tập Tốt nghiệp thoughts about in what measure Setech can do to reduce high level of employee turnover

The interview will involve asking informants open-ended questions, and obtain data deemed useful by the researcher including whys, hows and personal perceptions that the questionnaires does not mention.

After colleting the questionnaires, the answers were processed and analyzed with the support of Microsoft Excel The analysis results were presented in tables or in charts or in figures.

Research Scope

This thesis will concentrate on turnover intention among current employees at Setech, as their intentions have not yet translated into actions By comparing their responses with those of former employees, the study aims to identify correlations in turnover perceptions Additionally, the research acknowledges that actual turnover rates can be influenced by economic factors, which fall outside the scope of this investigation.

Besides turnover intention, this thesis will provide information and process from experiencing job dissatisfaction to having turnover intention, and finally, lead to employee turnover.

Geographical scope of the research: Setech Company in Hanoi and in Buon

Timing: Primary data was collected in April and May, 2017 Secondary data was collected for the period from 2013 to 2016.

Thesis Structure

The research is organized into four chapters, with the first chapter outlining the rationale, objectives, questions, methodology, scope, and structure of the study The second chapter focuses on defining employee turnover.

This article explores the factors influencing employee turnover, presenting theories and research frameworks derived from previous studies It includes an analysis of the current employee turnover situation at Setech and concludes with research findings and recommendations to improve retention rates.

Chapter 2: Theoretical background on employee turnover and factors influencing employee turnover.

Chapter 3: Analysis of factor influencing employee turnover

Chapter 4: Recommendations to reduce level of employee turnover in Setech.

THEORETICAL BACKGROUND ON EMPLOYEE TURNOVER

Overview of employee turnover and turnover intention

2.1.1 Employee turnover and turnover intention

Employee turnover refers to the voluntary departure of individuals from organizations, as defined by Hom and Griffeth (1994) Loquercio et al (2006) describe it as the ratio of staff leaving before the completion of their contracts within a specific timeframe Singh et al (1994) characterize staff turnover as the rate of change among employees during a designated period Additionally, Ivancevich and Glueck (1989) view staff turnover as the net effect of employee exits and new hires within an organization.

Turnover, as defined by Kossen (1991), refers to the movement of employees in and out of an organization According to Griffeth and Hom (2001), this turnover can be classified into two types: voluntary, where employees choose to leave, and involuntary, where employees are let go by the organization.

Voluntary turnover occurs when employees choose to leave their positions, while involuntary turnover happens without their consent, often due to factors such as long-term illness, death, relocation, or termination initiated by the employer (Heneman, 1998).

Research highlights the difference between employee turnover and turnover intention Mobley (1977) defines turnover intention as the voluntary desire to leave one's job, while Ajzen (1991) describes intentions as declarations of specific behaviors or interests Thus, employee turnover intention refers to an employee's voluntary decision to exit their current position.

Research indicates that turnover intention is the most significant predictor of actual employee turnover Hom et al (1992) found a positive correlation between turnover intention and employee turnover, suggesting that employees who express a desire to leave are likely to resign Similarly, Gregory et al (2007) emphasized that turnover intention serves as a precursor to actual turnover Mobley (1977) further elaborated on this concept in his model, identifying turnover intention as the final step leading to turnover.

Mobley's theory suggests that low job satisfaction prompts employees to consider resignation, influencing their assessment of the benefits of job searching versus the costs of leaving their current position This evaluation process involves comparing alternative job opportunities with their existing roles, ultimately leading to a decision on whether to quit According to Mobley, the intention to leave is a critical indicator of actual employee turnover, highlighting its significant role in predicting resignations.

Reducing employee turnover is crucial for maintaining competitiveness in the marketplace, as high turnover leads to decreased productivity, diminished commitment, and the loss of skilled personnel To strengthen their organization and address weaknesses, companies must analyze employee turnover and turnover intentions.

2.1.2 The necessity to study employees turnover and turnover intention:

In today's business landscape, a personnel-oriented philosophy is essential, emphasizing continuous improvement and the need to evaluate employee turnover This turnover serves as a key indicator of how effectively organizations reward their employees and reflects their competitiveness in the market by highlighting the presence of star performers.

To achieve business success, companies must prioritize employee satisfaction and address their needs and wants Numerous studies highlight the significance of employee loyalty and retention, demonstrating that reducing turnover rates positively impacts organizational performance.

Employee turnover is often underestimated by organizations due to the unquantifiable qualitative and quantitative impacts it brings The departure of experienced and skilled workers can result in serious negative consequences across various industries In the hotel sector, reducing employee turnover is crucial for lowering operational costs and improving labor productivity However, effectively managing and tracking turnover poses a significant challenge for hotels, as there is no clear point of accountability within or across different units.

Ahlrichs (2000) identified that the turnover of key employees incurs both visible and invisible costs that organizations often underestimate Visible costs include recruitment expenses, training, and temporary employee costs, all of which directly impact profitability and performance In contrast, invisible costs encompass increased HR administration, loss of productivity, and informal training Additionally, hidden costs such as missed deadlines, diminished organizational knowledge, decreased motivation from overwork, client loss, and subsequent employee turnover further exacerbate the financial burden of employee turnover on organizations.

High employee turnover negatively affects employee-customer relationships, as long-term employees typically cultivate personal connections with customers These relationships foster a positive cycle of beneficial interactions, enhancing overall customer satisfaction and loyalty.

Chuyên đề thực tập Tốt nghiệp positive effect on good customer relationship and ultimately profitability (Rust,

Employee turnover negatively affects the morale of remaining staff, leading to feelings of demotivation and decreased job satisfaction The loss of valuable employees can trigger a chain reaction, prompting others to resign voluntarily, which ultimately harms the organization Although the costs associated with this secondary turnover are challenging to quantify, they can be significantly detrimental to the company's overall performance (Hay, 2002).

Factors influencing employee turnover intention

2.2.1 Overview of researches on employee turnover intention

2.2.1.1 Research of Mobley, Griffeth, Hand, & Meglino (1979)

One of classic turnover model was designed by Mobley, Griffeth, Hand, &

Meglino et al (1979) developed a model that identifies the key factors affecting employee satisfaction and turnover intentions, categorizing them into individual, organizational, and economic/labor market influences These classifications help to understand the underlying causes of employee turnover.

Individual factors influencing employee decisions include interests, personality, aptitude, family responsibilities, and demographic aspects like age, gender, education, tenure, and socio-economic status In contrast, organizational factors pertain to the work environment, encompassing working conditions, climate, size, job content, goals, values, policies, pay, promotion opportunities, peer relations, and supervision Additionally, economic and labor factors play a crucial role in an employee's ability to transition to a new job, shaped by perceptions of alternative opportunities, unemployment and job vacancy rates, word of mouth, recruitment levels, and communication channels (Mobley et al., 1979).

All of these factors can lead to turnover intention, and result in employee turnover These factors are illustrated below in Figure 2.1.

Figure 2.1 Mobley et al (1979)’s simplified model

Source: Mobley et al (1979)’s research 2.2.1.2 Unfolding model:

The unfolding model posits that incoming shocks, such as pregnancy or alternative job offers, can significantly influence an employee's intention to leave an organization This theory outlines five distinct paths leading to turnover In Path 1, a shock activates a pre-existing narrative linked to past experiences, prompting the employee to exit without considering alternatives or their connection to the organization Path 2 involves a shock that compels the individual to leave due to a perceived violation of personal values and goals, leading to a realization that their current job does not align with their expectations Path 3 describes a shock that triggers a reevaluation of the employee's current job image, further influencing their decision to depart.

Individual factorsIndividual factors Organizational factorsOrganizational factors Economic/labor market factorsEconomic/labor market factors

Utility of present job Utility of alternative jobsUtility of present job Utility of alternative jobs

The internship topic highlights the disconnect between expectations and reality in job markets This situation prompts a deliberate job search aimed at exploring alternative employment opportunities as a substitute for current positions Notably, the last two approaches to this issue do not involve any shocks.

Job satisfaction plays a crucial role in career decisions, as demonstrated by two distinct paths In Path 4, an individual experiences such low job satisfaction that they impulsively leave their position without exploring alternative opportunities Conversely, Path 5 illustrates a more thoughtful approach, where low job satisfaction prompts the individual to actively search for new jobs, evaluate their options, and ultimately decide to leave their current role This process highlights the significance of assessing alternatives before making a career transition (Thomas et al., 1996).

Search and/or evaluation of alternative

2.2.3 Factors influencing employee turnover intention at Setech

Employee turnover is influenced by a combination of internal and external factors Internal factors encompass personal job preferences and interests, while external factors include the job environment, opportunities for advancement, availability of alternative job options, and compensation relative to market averages.

Even though all of the models above are the results of thoroughly research and market-testing process, they cannot be applied in the case of Setech In case of

Mobley et al (1979) identified three primary factors influencing employee resignation: personal, organizational, and market factors, with the latter requiring further research Consequently, the researcher opted to apply a portion of this model to Setech Lee and Mitchell (1991) provided a comprehensive analysis of employee turnover intentions, examining triggers, job satisfaction, and external pressures However, their unfolding model lacks a detailed exploration of the specific factors contributing to voluntary turnover, which ultimately leads to employee resignations.

The researcher has adapted existing models related to employee turnover intention to create a tailored model suitable for Setech and other Vietnamese companies This proposed model aims to address specific factors influencing employee retention within the local context.

Source: Model developed by author, 2017

The model created by the author, which comprises five key factors, may not encompass all elements influencing employee turnover intention However, for this research, the researcher modifies these factors to formulate a model that is more applicable to the study's objectives.

Setech and can thoroughly reflect the reality of employee turnover and turnover intention at Setech.

A positive work environment is a crucial factor influencing employee turnover intention Key elements of a supportive workplace, such as organizational stability, friendly competition among colleagues, and a comfortable atmosphere, foster employee attachment to their roles and lower turnover rates Conversely, organizational instability can significantly increase the likelihood of employees considering leaving their positions.

Job training and Career Advancement opportunity

High employee turnover is a significant issue in the food service industry, as highlighted by Zuber's research, which indicates that a predictable work environment encourages employee retention (Zuber, 2001) Conversely, organizations marked by inefficiency experience higher turnover rates (Alexander et al., 1994) Consequently, when organizations lack stability, employees are more inclined to seek opportunities in more stable environments, where they can anticipate clearer career advancement paths.

Compensation plays a crucial role in influencing employee turnover intentions in both profit and non-profit organizations Even when employees are aligned with the organization's mission and goals, inadequate compensation can lead them to seek opportunities elsewhere Research by Griffeth et al (2000) highlights that pay-related factors have a significant impact on turnover rates Their findings indicate that high-performing employees who feel undercompensated are more likely to consider leaving their positions, ultimately affecting organizational stability and performance.

2.2.3.3 Job training and Career Advancement (X3)

Career development plays a crucial role in influencing employee turnover intentions, as highlighted by David and Stephen (2005) Key motivational factors, such as recognition and opportunities for advancement, are essential for fostering employee loyalty within organizations To effectively motivate employees, it is vital that they perceive their work as meaningful and see advancement opportunities as a direct outcome of their dedication and commitment.

Dessler (2000) emphasized that organizational job training and career development programs enable individuals to recognize the gap between their current skills and the requirements for advancement, motivating them to commit to their professional growth.

The graduation internship program is designed to help employees achieve their set goals With a structured advancement plan, employees are motivated to perform at their best and are given equal opportunities for promotion By instilling a belief in the possibility of advancement, organizations foster employee commitment and engagement.

ANALYSIS OF FACTORS INFLUENCING EMPLOYEE

Overview of Setech

Setech Co., Ltd., officially known as Services and Development Technology of Vietnam Co., Ltd., was founded in 2011 and operates under business license No 0105478900, issued by the Division of Business Registration within the Department of Planning and Investment.

Setech is a dynamic company founded by a passionate and knowledgeable team, bringing six years of expertise in organizing international specialized exhibitions and seminars We also offer consultation services and provide top-quality security and safety equipment.

Setech specializes in the provision and installation of security, safety, electronic, and telecommunication equipment With a proven track record of successful projects, Setech consistently delivers high-quality technical solutions at competitive prices, earning the loyalty of its customers The company has collaborated with some of the largest organizations and companies, showcasing its commitment to excellence and reliability in the industry.

Vietnam, which should be mentioned such as the National Assembly Office,

Vietnam News Agency, General Department of Logistics Technology - Ministry of

Public Security, Military Institute of Science and Technology - Ministry of Defense,

Vietnam Television Corporation – VTC, Hoang Gia hotel- Quang Ninh, Thanh

Nhan Hospital, Kim Lien Hotel - Hanoi, The Bac Ninh Province People's

Committee Guest house, The Yen Bai Province People's Committee Guest house,

Military Institute of Automation Technology - Ministry of Defense, Ngo Si Lien

Secondary School, Vietnam Maritime Administration, Ha Tinh University,

Diplomatic Academy of Vietnam- Hanoi and etc

Setech company operates in the following business areas:

 Consulting and installing security and safety protection system for families, hotels, office buildings, schools….

 Consulting and installing advanced perimeter security system for prisons, train stations, buildings, public vehicles, borders…

 Providing and installing electronic, informatics and telecommunication equipment…

 Organizing national and international specialized events, seminar and exhibitions.

 Providing security platform for informatics technology;

 Consulting and providing other specialized equipment;

 Providing defense equipment, import and export with condition;

 Consulting education, investment, managing business and etc.

 Transferring technology in industrial, agricultural, constructional, informatics, cyber and telecommunications areas;

 Visa services, organizing tour, printing, designing and supplying gifts and etc

With the enthusiasm, innovation, high qualification and regular methodical training, Setech is always willing to receive, implement and bring new technology to the customers

Setech prioritizes transparency in all business operations and consistently honors commitments to customers and partners Currently, Setech serves as the trade representative for several major international corporations.

- El-Far corporation (Israel): Providing advanced perimeter security solutions;

- Haritham Technologies company (India): Software solutions;

- Trivox security group (Singapore): Security and safety equipment;

Figure 3.1 Organizational structure of Setech

SETECH Co., Ltd specializes in recruiting highly skilled engineers and science graduates The company's workforce consists of experienced professionals who have worked with various organizations, supplying essential equipment to key government bodies, including the Ministry of Science & Technology, the Ministry of Public Security, National Assembly officials, schools, and other governmental entities.

Number of employees working for Setech currently is 107 people, dividing into three (03) departments, which are:

The technical department comprises two types of staff: technicians/project staff and technical workers on-site Technicians and project staff operate from the office, assisting technical workers and ensuring alignment with the CEO's and department heads' directives Their primary responsibilities include planning, guiding employees to fulfill customer orders, and keeping projects on track In contrast, technical workers on-site monitor the performance of installed machines and systems, ensuring they function correctly When discrepancies arise between the installed systems and existing setups, these workers are tasked with identifying and resolving the issues promptly.

• Accounting department: The main job of employees at accounting department is to deal with the financial problems and perfect the financial statement and analysis of the company

The procurement department plays a crucial role in acquiring essential machines and systems for the company in the most advantageous manner Procurement specialists often seek collaborative partners to engage in projects that necessitate expertise beyond security and technology development These collaborators, while operating under Setech, frequently work externally, focusing on communication and the identification of new project opportunities for the organization.

SETECH Co., Ltd collaborates with a diverse team of experts across various fields to enhance its projects in consultation, design, equipment supply, and installation The company consistently benefits from the support of both domestic and international specialists, ensuring high-quality outcomes.

Our company aims to empower our officers with the necessary skills and knowledge to meet customer demands by effectively translating the latest advancements in electronics, telecommunications, and information technology into practical applications.

Mission: To build a well-known brand, to be a leading company in services and technology development.

Vision: Developing the human resource and develops advanced technology products to satisfy the demand from science and technology areas.

Setech has experienced an alarming employee turnover rate since its establishment in 2011, when it began with just seven employees, supported by various government entities Notably, within a short period, four of the original seven employees resigned in search of better opportunities In 2012, Setech had the opportunity to collaborate with government entities to host events, highlighting its potential for growth despite the challenges of retaining staff.

Setech has recognized the need for expansion due to a

Setech has experienced varying employee turnover rates from 2013 to 2015, with 2 out of 37 in 2013, 5 out of 46 in 2014, and 8 out of 63 in 2015 In 2016, the company expanded its operations into Buon Me Thuat, prompting management to increase hiring, particularly for collaborators, to enhance market growth.

However, the number of employees resigning remained high, 6 out of 98 in 2016

Figure 3.2 Employee turnover rate at Setech from 2011 – 2016

According to Figure 1, Setech's employee turnover rate appears to be declining, but a closer examination reveals that this decrease is largely attributed to the influx of new employees joining the company Notably, the absolute number of employees resigning from Setech has remained relatively stable since 2011, indicating that the proportional decrease in turnover rate is primarily driven by the growing workforce.

Setech has series problem regarding staff management that employees often stay at

Setech for a very short amount of time until finding a new job One of the former employee, Mr Tran Quoc Thang, after 2 years working as procurement specialists,

Chuyên đề thực tập Tốt nghiệp chose to leave his role at Setech, despite his affection for the company, to take up a Deputy Director position at another technology firm He observed that while employee turnover at Setech is not critical, it requires management's attention The departure of employees often leaves key positions hard to fill, as former staff had established vital connections with customers and partners He personally experienced this challenge when stepping into a former employee's role, needing considerable time to build relationships with important contacts, including high-ranking officials in government entities.

To address employee turnover and identify the factors influencing turnover intention at Setech, a researcher conducted a survey targeting both current and former employees The findings from this survey will be thoroughly analyzed and discussed in the upcoming thesis.

Factors influencing employee turnover at Setech

Table 1: Demographic Background of Respondents from current and former employees

Current employee Former employee Department Heads

Sex Freq Perc Freq Perc Freq Perc

Age Freq Perc Freq Perc Freq Perc

Marital Status Freq Perc Freq Perc Freq Perc

Source: Data analyzed and collected by author, 2017

Setech is a technical-focused company organized into three key departments: technical, accounting, and procurement The workforce predominantly comprises male employees, with a survey conducted by the researcher reflecting this imbalance despite efforts to include equal gender representation Current data reveals that 64.38% of Setech's employees are male.

35.62% are female out of 74 employees that participated in the survey, while 40% of former employees took part in this survey are male and 60% are female.

In Setech, the leadership structure shows that 67% of department heads are male, while 33% are female, with the latter serving as the head of finance Due to the limited sample size from former employees, it remains inconclusive whether male or female employees have higher turnover rates within the company.

Age of respondent’s has been categorized into five groups, which are below

The employee age distribution at the start-up company is categorized into five groups: under 25, 26-30, 31-35, 36-40, and above 40 Notably, over 40% of employees are under 30 years old, with 23.29% of the workforce being under 25 This demographic insight highlights the youthful nature of the company’s staff.

23.29 of them are from 26 to 30 The age group from 31 to 35 consists of the highest number of employees participating, up to 28.77% Employees from age 36 to 40 are 16 people out of 73 There are only 2 employees that are over 40 years old, one of them is the head of the company and one of them is the head of procurement/project department Out of 5 former employees, 4 of them (80%) are under 25 years old, which may reflects the author’s assumption that younger people tend to take risk more and often strive for the position in bigger and more profitable company despite their lack of experience

The survey reveals that a significant majority of employees and ex-employees are single, highlighting the youthful and relatively inexperienced workforce of the company compared to its peers Specifically, 65.75% of the 73 current employees identify as single, indicating a trend towards a younger demographic within the organization.

The internship topic reveals that among the current employees, all are married, while all five former employees are single Notably, all three department heads are married, supporting the hypothesis that married individuals tend to show greater job commitment This may be attributed to their increased responsibilities and stakes compared to younger, single employees.

Table 2: Academic Qualification of Respondents from current and former employees Current employee

Freq Perc Freq Perc Freq Perc

To evaluate academic qualifications, both current and former employees who participated in the survey were asked to provide information about their educational backgrounds, which were classified into six distinct categories.

Current employee data reveals that none hold a high school diploma, highlighting the significance of academic qualifications in Vietnam The workforce primarily comprises young individuals, with many being recent college graduates Survey results indicate that 12.33% of employees graduated from community college, while a substantial 80.82% hold university degrees.

The internship program features a team where only 5 members hold advanced degrees (MA/MBA/MTh), with 2 serving as department heads Notably, all former employees possess college degrees, suggesting that they may have more career options than community college graduates, which could lead to higher turnover rates as they pursue better job opportunities.

Table 3: Employee Information of Respondents from current and former employees

Freq Perc Freq Perc Freq Perc

Since the company was established in 2011, the respondent’s year of service was categorized into four groups: less than 1 year, 1 – 2 years, 3 – 5 years and 6 –

In the past decade, Setech has seen a significant turnover, with 19 of its 73 current employees having less than one year of service Among existing employees, 46.58% have been with the company for 1 to 2 years, while 21.92% have served for 3 to 5 years Notably, only 5.48% of employees, totaling four individuals, have been with Setech for over five years All three department heads are included in this workforce distribution.

Three employees have been with Setech since its inception Insights gathered from former employees indicate that extended tenure at Setech correlates with a heightened sense of loyalty and connection to the company.

Table 4: Job Position of Respondents from current and former employees

Department Heads Job Position Freq Perc Freq Perc Freq Perc

The survey conducted at Setech revealed insights into turnover intention and employee turnover across various positions and departments Among current employees, only 1.37% hold the head of the company position, while department heads represent 4.11% The technical department had the highest number of respondents, with technicians/project staff at 19.18%, collaborators at 23.29%, and on-site technical workers at 32.88% In contrast, only 6.85% of respondents were accountants, significantly lower than the technical (32.88%) and procurement departments (12.33%) Among former employees surveyed, procurement specialists accounted for 40%, followed by technicians/project staff and accountants, each at 20%.

(20%) is technical workers on site From the author’s understanding through interview with managers of Setech, the higher number of procurement specialists

Graduating interns often leave their companies due to the high demand for procurement specialists, particularly in technical industries This demand provides these professionals with enhanced opportunities to secure better-paying jobs and improved working conditions.

3.2.2 Factors influencing employees turnover at Setech

A positive working environment is characterized by organizational stability, friendly competition among staff, and comfortable working conditions These factors foster employee attachment to their jobs and significantly decrease turnover intentions.

The work environment can be categorized into two main groups: the physical working environment and the interpersonal relationships among staff and department heads Understanding these components is essential for fostering a positive and productive workplace.

Table 5 Working environment analysis of current and former employees

SA A SA DA SDA SA A SA DA SDA

I like the working environment at my company

Good working environment is the major driver that would make not think of leaving my company

Working environment had an impact on your

Chuyên đề thực tập Tốt nghiệp resignation

As indicated in Table 5 above, regarding statement “I like the working environment at my company”, 63 out 73 current employees (86.3%) that responds

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

Development orientation from 2016 to 2020

Setech is currently in an expansion phase, characterized by increased production, employment, output, wages, profits, and product demand and supply The company plans to expand its presence across various regions in Vietnam, leveraging its strong relationships with local authorities In 2016, Setech successfully opened a new branch in Buon Me Thuot, benefiting from its connections with local authorities and businesses, which has resulted in a stable income for the branch Looking ahead, Setech aims to continue its growth strategy by targeting new markets and opportunities.

- Looking for more expansion opportunity, especially in the Southern region of Vietnam, possibly Ho Chi Minh City.

- Keeping both Hanoi and Buon Me Thuạt branch’s profit at the positive level.

- Collaborate with more foreign partner for exclusive security system distribution in Vietnam, especially Israeli companies.

In order to successfully implement the business plan, development orientation of human resource is as of the following:

- Keeping the rate of employee turnover under 5% with little or no resignation from experienced employee.

- Hiring more experienced employees, preferably employees that have been working at managing position at other companies.

- Outsourcing experienced employees to temporarily working at new branches.

Summary of finding

A common belief is that an uncomfortable working environment drives employees to switch organizations, but recent analysis challenges this notion A survey revealed that an impressive 86% of respondents expressed satisfaction with the working environment at Setech, indicating a positive workplace culture.

Both current and former employees of Setech have expressed that the working environment is comfortable and enjoyable, contributing to a low intention to leave the company and a reduced employee turnover rate.

Over 70% of current employees and 80% of former employees at Setech report positive relationships among colleagues and with management, indicating that interpersonal dynamics are not a primary factor in employee turnover.

Workload distribution and equitable job allocation are crucial for employee satisfaction at Setech While 40% of respondents perceive the workload as unfair, management must address this issue to enhance workplace equity Additionally, pay levels and reward systems significantly impact employee turnover; although 70% of employees are satisfied with their salaries, only 50% express contentment with the reward system, indicating a need for improvement in this area to retain talent.

Job training and career development significantly impact employee turnover and turnover intention Survey data reveals that 81.3% of respondents felt that training and career advancement opportunities were not distributed fairly This perception may stem from Setech's lack of a structured job training and career development program, leading employees to question if they are the only ones missing out on training opportunities.

A recent survey revealed that 64% of current employees at Setech feel excluded from the decision-making process, a sentiment echoed by former employees This lack of involvement in key organizational decisions, coupled with insufficient job training, may contribute to employee turnover at Setech.

Management behavior significantly influences employee turnover intentions, with a striking 83.9% of Setech employees citing mismanagement as a key reason for their desire to leave the company Despite Setech's efforts to implement measures aimed at reducing employee turnover, the effectiveness of these initiatives remains unclear, as the results have not demonstrated noticeable improvements.

A recent survey conducted by researchers revealed that the primary factors influencing turnover intention at Setech include insufficient job training and career development opportunities, an unclear promotion process, and limited involvement in decision-making Additionally, Setech could benefit from enhancing its reward system and fostering teamwork to improve employee satisfaction and retention.

Recommendations

4.3.1 Organizing more team building activities aims to strengthen the bond among employees as well as between employees and managers:

Team building activities are essential for strengthening relationships among company members, fostering a comfortable work environment These activities can range from overnight camping trips with team challenges to regular company dinners, ideally held once a month Such gatherings not only help relieve employee stress but also provide an opportunity to gauge job satisfaction and identify areas for improvement The informal setting of a company dinner encourages open discussions about workplace concerns, allowing employees to express their feelings more freely than in a formal meeting.

The location of the annual company holiday varies based on the company's financial situation, with Setech opting for a nearby destination if funds are limited, allowing employees to connect with one another and their families In addition to the holiday, a semi-annual campfire event is organized, where employees engage in team-building activities led by management, fostering stronger bonds and trust within the company These initiatives not only promote teamwork and collaboration but also help alleviate employee stress, enhancing overall workplace morale.

4.3.2 Developing a clear reward system to increase transparency of the company’s compensation policy:

Setech must establish clear employee performance expectations that outline essential goals, such as maintaining client relationships, building a new customer network, contributing innovative ideas to enhance the company, and effectively negotiating with clients It is crucial to annually update this list of expectations and ensure it is reviewed by both upper management and employees to align with the company's objectives.

To enhance employee motivation, companies should establish clear performance expectations and identify suitable rewards for achieving various goals For instance, when employees successfully negotiate with customers, they may receive a share of the monetary gains Additionally, rewards can extend beyond financial incentives, including gifts and recognition awards, to further encourage and motivate employees as needed.

To ensure fairness and transparency at Setech, it is essential for all employees to be aware of the reward system and its requirements Understanding these criteria empowers employees to recognize that they can be rewarded for meeting the necessary standards.

4.3.3 Creating a job training system to increase skills and knowledge about company:

Setech must implement two essential job training systems: general training and skill-set training General training is crucial for onboarding new employees, involving personalized discussions with the company head to convey the company’s values and expectations This approach not only motivates new hires but also provides them with a foundational understanding of Setech's culture and objectives.

Setech fosters a strong connection between employees and managers, enhancing workplace relationships While general training may not demand significant financial investment, it proves highly effective in motivating employees to work towards shared goals and achieve collective success.

Skill-set training will be conducted as on-the-job training tailored to the specific skills required by different departments and positions within the company Managers will designate experienced employees to mentor new hires in their assigned roles Monthly reports will be generated by these skilled employees to evaluate the progress and development of new staff The assessment period will conclude after six months, at which point high-performing employees will be given new responsibilities, while those still needing improvement will continue their training until they are ready for new tasks.

4.3.4 Examining company’s core competency aims to develop a clear direction of growth for the company:

Setech , as a new company, has not yet developed their own core competency, thus, employees do not have a clear vision of what they expect of

Setech Without a clear vision, the company might lack direction of growth and future planning.

Core competency refers to a specialized area of expertise that emerges from the integration of complex technologies and work processes It signifies more than just proficiency; it involves the effective combination of a company's capabilities, resources, and organizational knowledge to create a competitive advantage.

To establish a strong foundation for employee confidence and future success, a company must develop robust core competencies These competencies not only enhance organizational effectiveness but also empower employees to believe in the company's capabilities and vision.

• It's valuable (It either solves a customer's problem or adds to the experience.)

Setech's core competency lies in its commitment to innovation, focusing on transforming Vietnam into a hub for smart and secure cities This emphasis on innovation enables employees to recognize Setech's strengths and capabilities in driving urban development.

Setech to grow, in turn, employees will feel more powered and have high morale when knowing what working for Setech.

4.3.5 Creating exit interviews and focused-group meeting aims to reduce employee turnover’s intention:

Exit interviews play a crucial role in understanding the reasons behind employee departures By analyzing the insights gained from these interviews, organizations can identify areas for improvement, necessary changes, and aspects that should remain unchanged.

Setech's exit interview process should prioritize personalized, one-on-one conversations between departing employees and company leaders, given its smaller workforce This approach allows for detailed feedback on areas for improvement within the organization However, it may also inhibit employees from sharing uncomfortable truths The optimal timing for these interviews is when an employee shows signs of disengagement, as their insights about their departure are most pronounced at that moment By analyzing feedback from former employees, Setech can implement effective solutions for organizational enhancement.

Each month, the company will hold focused group meetings for employees to express their dissatisfaction and highlight areas for improvement These meetings will not be open forums; instead, employees will submit their concerns anonymously on paper, allowing managers to identify and understand ongoing issues that may otherwise go unnoticed.

Writing opinions anonymously allows employees to express their thoughts without the discomfort of open meetings, fostering a more honest dialogue This approach not only encourages participation but also highlights issues that may have gone unnoticed, ultimately enhancing overall employee satisfaction.

Tiêu đề	Studying Factors Influencing Employee Turnover At Setech
Tác giả	Vũ Thu Trang
Người hướng dẫn	Assoc. Prof. Dr. Vu Thanh Hung
Trường học	National Economics University
Chuyên ngành	MBA
Thể loại	thesis
Năm xuất bản	2017
Thành phố	Hanoi

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