THEORETICAL FRAMEWORK
Conceptual framework
Employee loyalty has been defined in various ways throughout the literature Due to the absence of a universally accepted definition, it is essential to compare different definitions and conceptualizations of the loyalty construct.
Initially, loyalty was defined as the commitment of employees to their organizations, characterized by adherence to directives from higher authorities (Lawrence, 1958; Whyte, 1956) Over time, this concept evolved to encompass a broader understanding of loyalty as an employee's emotional connection and attachment to their organization (Buchanan, 1974; Hirschman, 1970).
Loyalty is defined as the active expression of pride and dedication to an organization (Niehoff, Moorman, & Fuller, 2001) Additionally, it encompasses the psychological conditions that reflect an individual's relationship with the organization (Allen & Meyer, 1991).
Loyalty, as defined by Porter et al (1979), is the relationship between individuals and groups characterized by a strong belief in an organization's goals and values, driving individuals to work diligently for the organization and fostering a desire to remain part of the team Additionally, loyalty is viewed as a form of employee commitment to the organization, necessitating that employees prioritize the interests of their boss and the company (Elegido, 2013).
Nippa & Hornung (2014) identify three distinct schools of thought regarding the definition of loyalty: the attitudinal approach, which views loyalty as an emotional attachment and identification with the organization; the normative approach, where loyalty is perceived as a sense of obligation; and the behavioral approach, which considers loyalty as a side-bet, reflecting an investment in the organization.
Loyalty is characterized by an emotional attachment, involvement, or identification with an organization Employee loyalty is defined as a strong sentiment of attachment to a specific entity (Powers, 2000).
Loyalty in the workplace is defined as an individual's level of involvement with their organization, as noted by 1997 Chen et al (2002) emphasized that loyalty involves embracing the goals and values set by leadership Similarly, Coughlan (2005) suggested that employee loyalty is rooted in the commitment to moral principles while striving for both personal and collective objectives.
Employee loyalty is defined as a strong sense of dedication and obligation towards an organization Chen et al (2002) describe loyalty as a demonstration of unreserved dedication, while Schrag (2001) emphasizes it as a wholehearted devotion to a cause or entity.
Employee loyalty is often viewed as an investment made by individuals in their organizations throughout their tenure According to Logan (1984), it represents a strong connection that keeps employees committed to their company, even when leaving may be more financially beneficial Butler (1991) described employee loyalty as an implicit commitment to avoid undermining one’s supervisor, while Chen et al (2002) highlighted the willingness to prioritize the supervisor's interests over personal gain.
In this research, the author adopts the behavioral approach to employee loyalty This research accepts the definition of loyalty put forward by Logan
Employee loyalty is defined as a strong commitment that connects an individual to their employer, even when remaining with the company may not be financially beneficial According to Elegido (2013), this loyalty involves a conscious dedication to advancing the employer's interests, which may require personal sacrifices that exceed legal and moral obligations.
Recent definitions of loyalty often intersect with organizational commitments, prompting a comparison between these two constructs Anderson and Weitz (1992) and Morgan and Hunt (1994) describe organizational commitment as a long-term relational perspective that encourages parties to prioritize enduring relationships over short-term gains Chen et al (2002) further conceptualize it as the psychological attachment of employees to their organizations The literature indicates that loyalty is frequently viewed as synonymous with organizational commitment (Hirschman, 1970; Morrow & McElroy, 1993; Werther, 1988) However, due to the vague definitions surrounding loyalty and the mixed literature regarding their distinctions, Morrow (1983) argues that while loyalty and commitment share commonalities, using them interchangeably can lead to significant misunderstandings.
While often used interchangeably, commitment and loyalty differ in two key aspects Commitment to an organization is a personal choice influenced by rational judgment, whereas loyalty encompasses a normative aspect of obligation or duty Additionally, commitment is unidirectional, reflecting the degree of an employee's dedication, while loyalty is mutual and arises from interpersonal relationships.
(2007) advocated that commitment still remains an important element of loyalty In this study, the author supports the differences between organizational commitment and employee loyalty
Although loyalty is difficult to quantify, the behaviour consistent with loyalty can be measured, for example offers passed on to the others (Sajven,
Loyalty discourages employees from considering exit options, even when presented with appealing offers (Hirschman, 1992) According to Allport (1933), loyalty comprises three key elements: its voluntary nature, the expectation of continuous commitment, and its foundation in moral principles.
The Measurement Dimension of Employee Loyalty, as proposed by Lee, Lee, & Lin (2015), encompasses two key aspects: employee satisfaction and employee commitment to the organization These sub-dimensions are operationally defined to provide a comprehensive understanding of employee loyalty within the workplace.
(1) Employee satisfaction: refers to employee sense of satisfaction towards their work environment and the work itself, which includes (A) internal satisfaction, and (B) external satisfaction
Employee commitment to an organization reflects their psychological connection and emotional attachment, influencing their acceptance of organizational goals and effort levels High participation and identification among employees correlate with increased commitment to the organization.
Characteristics of a loyal employee have been under debate for many years (Meyer & Allen, 1997; Morgan & Hunt, 1994; Powers, 2000; Solomon,
1992) The following are characteristics of a loyal employee:
- A loyal employee is less likely to look for work elsewhere – expects to stay with the company both in the short-term and long-term
- A loyal employee would recommend working for the company to others – proud to be working for the company
- A loyal employee is interested in doing her/his best, and make an extra effort when required – this relates to the individual employee‘s performance and contribution to the company value,
Outcomes of employee loyalty
Employee loyalty has been found to be related to a host of outcomes The consequences of employee loyalty can be classified into individual outcomes group outcomes and organizational outcomes
Employee loyalty significantly influences workplace behavior, with research highlighting a strong connection between loyalty and various workplace attitudes and actions.
Hirschman (1970) identified two primary responses employees have to negative events: "voice" and "exit." Voice involves expressing concerns about problems and injustices, while exit refers to the decision to leave the job The study predicts that loyal employees are more likely to choose voice over exit when faced with organizational issues Research indicates that loyal employees tend to address problems directly by communicating with supervisors or peers, whereas less loyal employees are inclined to pursue formal grievances or seek resolution outside the organization (Olson-Buchanan).
Job satisfaction refers to the overall contentment of employees with their roles, including factors like the work environment, management, and organizational culture, which are recognized as key contributors to employee loyalty Conversely, some studies indicate an inverse relationship, suggesting that employee loyalty can also enhance job satisfaction For instance, research by Chen (2001) revealed that loyalty to supervisors significantly increased job satisfaction among Chinese employees.
Loyal employees demonstrate greater individual effort and job performance, leading to increased productivity at work (Chen et al., 1998) Research indicates that these loyal employees not only excel in their core job responsibilities but also engage in extra-role activities, resulting in superior overall performance compared to their less loyal counterparts (Chen et al., 2002) Similar conclusions have been drawn from studies involving Chinese employees, reinforcing the positive correlation between employee loyalty and job performance (Wong et al., 2002).
Loyalty can be directed towards the entire organization, individual supervisors, or specific teams, and it is anticipated that such loyalty will enhance the performance of both the organization and the groups comprised of these dedicated members.
James and Cropanzano (1994) explored the hypothesis that strong loyalty within a group can predict its performance Their findings indicated that loyal members are more likely to invest greater effort in team activities, leading to enhanced overall performance Additionally, these loyal individuals exhibit positive behaviors, including word-of-mouth recommendations and active participation in extra-role activities, further benefiting the group.
Research indicates that employee loyalty enhances decision-making consensus A study by Dooley and Fryxell (1999) revealed that team members who are loyal perceive dissent positively, which in turn improves the overall quality of decisions.
A number of researches have been conducted to examine the influence of employee loyalty on organizational outcomes
Loyal employees play a crucial role in enhancing customer satisfaction, as their dedication and exceptional performance are often recognized by customers, thereby improving the perceived quality of organizational performance (Kumar & Shekhar, 2012) These long-term employees possess in-depth knowledge of customer-related issues, including products, pricing, and business needs, which enables them to foster strong relationships and build trust with customers This trust ultimately leads to increased customer satisfaction and loyalty (Reichheld, 1993).
Similar findings were fould in different industries such as grocery retail and services (Kearney et al., 2012; Yee et al., 2010)
Employee loyalty significantly enhances firm performance by directly influencing labor productivity and financial outcomes, as evidenced by research from Brown et al (2011) Additionally, loyal employees contribute to increased customer satisfaction, which further boosts overall firm performance, as highlighted by Kumar and Shekhar (2012) and Reichheld (1993).
In summary, existing studies indicate a strong positive correlation between employee loyalty and performance at both individual and organizational levels However, the effects of employee loyalty on group-level performance remain insufficiently explored Nonetheless, research consistently highlights the beneficial impact of employee loyalty on individual, group, and overall firm performance.
Antecedents of employee loyalty
Human resources are recognized as the most crucial asset in organizations, with employee loyalty serving as a key driver of success Loyal employees contribute significantly by exerting extra effort, enhancing the organization's reputation, and exceeding expectations, which leads to improved operational effectiveness They add substantial value through increased work effort and higher quality products and services, resulting in greater customer satisfaction, increased profits, and reduced turnover Conversely, a lack of loyalty can harm organizations by causing trust issues, inefficiency, and higher absenteeism Given the importance of employee loyalty, extensive research has been conducted to identify its antecedents, which can be categorized into individual, group, and organizational characteristics.
A number of previous researches have investigated the relationship between personal traits and employee loyalty Mustafa, Abidin & Saufi
A study conducted in 2013 explored the effects of personal traits such as work locus of control and self-efficacy on employee loyalty Locus of control refers to the degree to which individuals believe they can influence events through their own actions (internal) versus external factors Self-efficacy assesses a person's confidence in their ability to successfully complete assigned tasks Analysis of data from 100 school teachers indicated that both self-efficacy and internal locus of control are significant predictors of employee loyalty Additionally, the findings suggest that highly motivated employees are more likely to demonstrate loyalty to their organizations.
Bloemer & Odekerken-Schroder (2006) conducted a study examining how employee relationship proneness affects attitudinal loyalty and loyalty behaviors among bank employees in the Netherlands The survey, which included responses from 199 bank employees, revealed that a strong correlation exists between employee relationship proneness and attitudinal loyalty These attitudinal loyalties serve as a crucial foundation for fostering loyalty behaviors in the workplace.
Individual perception plays a crucial role in shaping and maintaining employee loyalty A study by Berntson, Naswall, and Sverke (2010) involving 725 white-collar workers in Sweden revealed a significant relationship between employees' perceptions of their employability and their loyalty to their organizations The findings indicated that those who perceive job alternatives are more inclined to exhibit lower levels of loyalty towards their employers.
In a study by Vushnumurty (2009), the relationship between employees' perceptions of ergonomics and their loyalty was investigated, involving a sample of 337 employees from the banking and telecom industries in both public and private sectors The findings revealed a strong positive correlation between employees' ergonomic perceptions and their loyalty in both the telecom and banking groups.
Creativity, innovation, and personal development are crucial factors in enhancing employee loyalty, as identified by Martensen & Grứnholdt (2006) To effectively retain employees, companies should focus on improving their knowledge, skills, and competencies through career planning, empowerment, and granting responsibilities Additionally, offering challenging roles and encouraging creative and innovative thinking are essential strategies for fostering a loyal workforce.
Employee satisfaction is a key predictor of loyalty, as demonstrated by research from Hassan, Ahmed Khan, and Iqbal (2013), which examined the effects of empowerment, compensation systems, and performance appraisals on job satisfaction in a State-owned bank in Pakistan Their study revealed that all three factors significantly contribute to employee job satisfaction, which in turn has a strong impact on fostering employee loyalty.
A study by Pološki Vokić & Hernaus (2015) examined the link between job satisfaction, work engagement, and employee loyalty, utilizing data from a field survey involving 567 employees at a large Croatian company The findings revealed that work engagement is a strong predictor of employee loyalty and serves as a mediator in the relationship between job satisfaction and employee loyalty.
In their 2012 study, Arsić, Nikolić, Živković, Urošević, and Mihajlović examined the connection between Total Quality Management (TQM) and employee loyalty in Serbia They identified six key aspects of TQM, discovering that five significantly affected job satisfaction This job satisfaction, in turn, was found to have a strong and positive influence on employee loyalty.
Kearney, Coughlan & Kennedy (2012) examined the effects of servicescape in grocery stores on employee and customer satisfaction through a comprehensive survey of salespersons in the grocery sector Their research revealed that higher job satisfaction among employees resulted in increased loyalty from both employees and customers, aligning with previous studies in the field.
A study by Cunha (2002) explored the connection between leadership, organizational culture, structures, and employee loyalty The findings indicated that effective leadership, a low-profile organizational culture, and a high-performance organizational structure significantly enhance employee loyalty.
A study by Lee (2008) explored the connections between leadership empowerment, job satisfaction, and employee loyalty among university student workers The research identified five key dimensions of leadership empowerment: participation in decision-making, goal accomplishment, confidence in high performance, autonomy, and the meaningfulness of work Analyzing data from 161 student employees, the findings revealed that confidence in high performance and autonomy significantly predicted employee loyalty.
Ding, Lu, Song & Lu (2012) aimed at identifying the relationship between servant leadership and employee loyalty Self-administered questionnaires were used to collect data from MBA student at a University in
A study conducted in China analyzed 186 observations and revealed that servant leadership significantly influences employee loyalty Additionally, job satisfaction serves as a mediating factor in the relationship between servant leadership and employee loyalty These findings align with existing research on the connections between leadership styles, job satisfaction, and employee loyalty.
A survey conducted by Martensen & Grunholdt (2006) involving 532 full-time employees in Sweden revealed that leadership significantly influences employee loyalty The findings strongly support the positive correlation between effective leadership and enhanced employee loyalty.
A study conducted by Khuong, Tung, and Trang (2014) involving 214 salespersons from import-export companies in Ho Chi Minh City, Vietnam, revealed that transformational, transactional, and organic leadership styles positively influence employee loyalty Conversely, the research indicated that autocratic leadership has a negative impact on employee loyalty.
METHODOLOGY
Research process
Human resources are the cornerstone of any organization, as companies with loyal employees enjoy a competitive edge and greater longevity Retaining these invaluable team members is crucial for success, emphasizing the need for employers to recognize and nurture employee loyalty.
Identify main research problems (Employee loyalty in organizations)
Literature review of relevant topics Propose research model
Designing research method Developing survey instruments
Data analysis Reporting results and research findings
To enhance employee loyalty in Vietnam, managers must thoroughly understand the key factors influencing this loyalty By gaining insights into these elements, they can develop and implement effective policies and practices that foster a committed workforce Consequently, the primary research question guiding this study is: "What are the factors that influence employee loyalty in Vietnam?"
Step 2: Literature Review of relevant topics
This study examines existing research on employee loyalty, focusing on its definitions, measurements, antecedents, and consequences Through a comprehensive literature review encompassing both Vietnamese and international contexts, the author identifies gaps that inform the current research Subsequently, a research model is proposed based on the evaluation of previous studies.
This study employs a mixed-methods approach, integrating both qualitative and quantitative research techniques Qualitative research is ideal for exploratory purposes, as it uncovers underlying reasons, opinions, and motivations, offering valuable insights into the problem and aiding in the formulation of hypotheses for subsequent quantitative analysis Conversely, quantitative research focuses on quantifying the issue by generating numerical data that can be analyzed statistically, allowing for the measurement of attitudes, opinions, and behaviors, and facilitating the generalization of findings to a broader population.
Qualitative research through in-depth interviews with employees identified five key behaviors that express loyalty to an organization: pride in the organization, promotion of its products and services, extra effort in work, a long-term commitment, and alignment with organizational goals and visions Additionally, interviews with managers indicated that employee characteristics, perceptions, and organizational practices significantly influence employee loyalty.
Interviews with managers reveal that employee characteristics, perceptions, and organizational practices significantly influence employee loyalty Through in-depth discussions with management and employee representatives, seven key factors have been identified that impact employee loyalty: working conditions, nature of the job, promotion opportunities, salary, work environment, leadership quality, and recognition.
Following the insights gained from in-depth interviews, the author developed a draft questionnaire for a pilot survey targeting a small group of employees After implementing all necessary revisions, the final version of the survey instrument was completed.
Primary data was gathered through self-administered paper questionnaires distributed directly to VNPT employees with the necessary permissions Respondents were instructed to carefully read and accurately complete the questionnaires, which were collected by the author's team on the same day of distribution.
Choosing of sample: random in proportion to employees in each unit
- Main contents of the questionnaires:
+ Gender, Age, Education, Seniority, Position of the respondents
B Characteristics of the respondents and their perceptions:
+ Relationship with leaders + Need for affiliation + Perceived employability
+ Nature of Work + Employment Benefit + Working Environment + Recognition
D Behaviors characterized by loyal employees + Pride towards the organization
+ Promotion of organization‘s products, services and employment opportunities, + Extra effort in work,
+ Long-term orientation, + And identification of organizational goals and visions
These following procedures are planned to be used while evaluating of data:
+ Reliability of the measurement scales + Factor analysis of the latent structure of loyalty + And regression analyses will be used to answer research questions
Besides, we also use the common analytical methods as descriptions, statistics and analysis to evaluate the research content
SPSS software version 18.0 was used to analyze data
Step 6: Purpose solution, suggestions and recommendation
Based on the results of data analysis, conclusion would be made Then possible solutions were suggested together with recommendations
This study employs descriptive, comparative, and analytical research methods, alongside desk research to review existing studies and theoretical documents related to the research topics Additionally, a sociological survey is utilized to gather data, incorporating both qualitative and quantitative approaches to examine the relationships among the variables in the research model.
Qualitative research is ideal for exploratory studies as it helps uncover underlying reasons, opinions, and motivations This study employed qualitative research methods to understand employee loyalty and the latent behaviors associated with it.
Quantitative research employs a structured deductive approach to gather numerical data, enabling the prediction and measurement of variables through statistical analysis to formulate and test hypotheses (Leedy & Ormrod, 2005; Rowan & Huston, 1997) This method is particularly suitable for examining the effects of various factors on employee loyalty in this study.
Questionnaire survey method (questionnaire survey): Data collection in the research was conducted through questionnaire survey with the respondents being current employees of the company
The author developed questionnaires and sought input from instructors, experts, and lecturers at HSB-VNU, as well as senior management personnel from the company A pilot survey involving 20 employees was carried out to gather feedback and suggestions for refining the questionnaire prior to the main survey implementation.
Survey questionnaire design: Questionnaire was developed based on the research model with 8 factors including 37 questions The questionnaire consists of three parts:
Part I: Introduction to research purposes
Part II: Include demographic questions, classification by professional level, age, gender, marital status.
Research method
The author conducted a survey among MobiFone employees using two methods: direct interviews with the director and department heads to assess employee loyalty and its influencing factors, and an online questionnaire distributed via Google Docs Given the job characteristics, working hours, and locations of the employees, the online survey method was chosen for its convenience, allowing participants to engage at their own time and from various locations, thereby enhancing response reliability Additionally, the customizable and user-friendly interface of Google Docs facilitates result synthesis, as data can be easily saved into a worksheet However, this method also presents the drawback of reduced interaction between the author and respondents.
To determine the appropriate sample size for Exploratory Factor Analysis (EFA), Hair et al (1998) recommend a minimum of N > 5 * x, where x represents the total number of observed variables Tabachnick and Fidell (1996) suggest that for optimal regression analysis, the sample size should be calculated using N > 50 + 8m, with m being the number of independent variables Bentler and Chou (1987) estimate that a minimum of 5 observations per parameter is necessary In this study, with 33 observed variables and 7 components, the author calculated the required sample size as N > max (5*33; 50 + 7*8), resulting in a minimum of 165 observations To account for potential non-response and incomplete data, the author distributed questionnaires to 300 employees from three MobiFone member companies using a non-probability, convenience sampling method, with data collection occurring from April to July 2018.
Data processing method
Secondary data sources on employee loyalty include information gathered from curricula, online resources, research studies, newspapers, and magazines Additionally, company-specific data such as annual financial statements, sector reports from the State Committee, internal HR documents, and organizational structure details from 2015 to 2017 were analyzed This data provides insights into the current state of employee loyalty and the company's strategies for enhancing it.
Primary data sources: Data collected from the survey forms were entered and used to compile, compare, and analyze data collected on Excel to assess the actual loyalty and performance
After receiving the answers, the authors encode and enter data, then analyze the data using Excel software
Analytical framework of this study
Based on the literature review and results of in-depth interview, the author proposes the following analytical model:
Limitations of the chosen methodology
The foreseen methodology though overall seen as the most successful can have the following limitations:
- Sample may not be representative of the whole population
- The interviewee can be absent leading to shortage of enough opinions/information
Promotion of organization‘s product/service & brand
Identification to the company‘s values, vision and goals
CURRENT STATUS OF EMPLOYEE LOYALTY
About MobiFone Corporation
3.1.1 Formation process, functions, tasks and organization of MobiFone
On 01/12/2014, MobiFone Corporation was established on the basis of reorganizing the One-member Limited Liability Company under the Decision
On April 16, 1993, the Ministry of Information and Communications issued Decision No 1798/QĐ-BTTTT, leading to the establishment of MobiFone Telecom Corporation The company has successfully executed and finalized its restructuring process in accordance with the approved model Currently, MobiFone's organizational structure comprises an internal audit committee and various member units.
The organization comprises 13 functional boards, each playing a crucial role in its operations These include the Organization and Personnel Committee, Finance Committee, Accounting Department, and Strategic Planning Department Additionally, the Network Development Board, Management Board of the network, and Board of Investment contribute to strategic growth The Business Department, Value-added Services Department, and International Business Department focus on enhancing service offerings and expanding global reach Furthermore, the Information Technology Committee, Communication Board, and Customer Care Department ensure effective communication and support for clients.
- Office of the Corporation, Office of the Party - Union, Trade Union Office
- 01 functional room (Export-Import department) c Infrastructure management boards 1,2,3 and 1,2 d The subordinate units:
- MobiFone Network Center in the North, Central and South
- Center for Network Management and Governance (NOC)
- MobiFone Research and Development Center
- MobiFone Testing and Repair Center
- MobiFone Information Technology Center (IT)
- MobiFone Multimedia and Value Added Services (MVAS)
- Mobifone Charge and Liquidity Center " e The four subsidiaries include MobiFone Global, MobiFone Plus, MobiFone Service and AVG
MobiFone is enhancing its organizational structure through a new model while focusing on four key business areas: Telecom & IT, Multi-Service, Television, and Distribution & Retail This strategic transformation aims to evolve MobiFone from a service provider into a leading national telecommunications corporation, offering comprehensive telecommunications, information technology, television, and integrated services.
3.1.2 Functions and tasks of the units are as follows:
MobiFone Service Sector 1 through 9 oversees the delivery of all MobiFone services to various target groups, aligning with the company's development plan for the designated provinces and cities under their management.
The International Telecommunication Center is responsible for managing and delivering international telecommunication services It proposes investments, solutions, equipment, and applications to enhance global business services Additionally, it oversees traffic routing, manages international roaming services, and ensures the quality of international telecommunications.
The NOC center is responsible for the management, operation, and maintenance of core network equipment, ensuring efficient transmission and installation It also addresses troubleshooting for core network issues and optimizes the quality of traffic direction and services offered to customers.
The MobiFone Research and Development Center focuses on enhancing the quality of products and services while ensuring competitive pricing Additionally, it offers consultancy on technology transfer and intellectual property rights related to technology, products, and services for MobiFone and other organizations.
The MVAS center is dedicated to developing and executing business plans and policies, focusing on the creation of value-added products and services It also emphasizes data utilization and fosters collaboration with business partners to enhance content delivery.
MobiFone is dedicated to researching, manufacturing, and developing innovative information technology applications for its customers The company focuses on studying its software systems, collaborating with partners on technology transfer, mastering these systems, and leading efforts to optimize, upgrade, and enhance their features.
The MobiFone Telecommunication Testing and Repair Center specializes in the installation and repair of telecommunications and auxiliary equipment It conducts network quality testing to enhance operational efficiency across the company Additionally, the center focuses on researching and testing innovative solutions and technologies to improve application techniques.
The MobiFone Charge and Liquidity Center plays a crucial role in managing MobiFone's centralized charging system and internal IT infrastructure, facilitating network engineering and supplying essential data for the company's business operations.
MobiFone Design Consultancy Center has the functions, tasks of investment consultancy, specialized construction of mobile information, information and telecommunication for MobiFone's units inside and outside
MobiFone Network Centers across the North, Central, and South are responsible for managing, operating, and maintaining transmission and wireless network infrastructure Their key tasks include handling incidents at broadcast stations within their regions and optimizing network coverage to meet the quality standards required by trading companies for customer service.
After its restructuring, MobiFone has streamlined its operations by separating the business and technical-network divisions into three distinct business fields This organization ensures that each area operates independently without overlap, with a single business unit representing MobiFone in customer interactions Technical units serve as suppliers and support coordinators, facilitating business operations The production and business activities are consistently organized across all levels, from the corporate to the district and commune levels.
MobiFone is fostering collaboration among its units within the same block and across different blocks by implementing economic mechanisms and management sanctions, including revenue sharing and managing revenue and expenditure differences This initiative involves establishing coordination processes, setting performance criteria, and conducting cross-evaluations based on KPI metrics, salary structures, and bonuses for MobiFone units.
3.2 Situation of human resources at MobiFone Telecom
3.2.1 Workforce based on educational level
MobiFone boasts a highly qualified workforce, with over 85% of its employees holding a university degree or higher, setting it apart from competitors in the industry This emphasis on education highlights MobiFone's commitment to high-tech, knowledge-intensive operations, where a significant portion of tasks is often outsourced to external partners.
Table 3.1: Mobifone Headcounts by Educational level
Current status of employee loyalty
Over the past three years, MobiFone has maintained a stable workforce; however, a notable number of employees have departed from the company The turnover rates for this period highlight the extent of employee attrition.
Recent data indicates that although the turnover rate remains relatively low at under 10% of the total workforce, there is a concerning trend of rapid increase, with a year-on-year rise exceeding 20% This suggests a decline in employee loyalty, signaling potential challenges for workforce stability.
The data reveals that 37% of employees who left the company were aged 25-35, while 25% were between 35-45 years old This trend highlights the departure of experienced employees, raising concerns as it is common for younger employees to change jobs after a few years The significant turnover among seasoned staff indicates a pressing issue that warrants further investigation.
An investigation revealed that 35% of employees who left the company in the past three years had 5 to 10 years of experience, indicating a significant loss of individuals familiar with the company's strategy, policies, and operations These employees possessed a strong understanding of the company's core values and key success factors, making their departure, particularly to direct competitors, a critical threat to the company's growth and survival.
Turnover by years of service
15 years
Figure 3.3: Turnover by year of service
Between 2015 and 2017, over 50% of employees who resigned from MobiFone held management positions, despite managers comprising only 30% of the overall workforce This trend indicates a concerning lack of employee loyalty within the company.
Status of enhancing loyalty
The annual merit award is established based on the Union's regulations guiding Labor Union practices While it recognizes advanced labor and emulators, the current format of meetings and emotional feedback fails to effectively motivate workers to enhance their productivity.
MobiFone has recognized the need to enhance its employee performance evaluation metrics, which are essential for developing a comprehensive compensation policy In response, the company has introduced a 3P compensation system that focuses on position, individual contributions, and performance, aiming to boost motivation and foster employee loyalty This innovative approach to compensation is encapsulated in the formula: "Income = Salary + Bonus + Benefit," highlighting the importance of a well-rounded incentive structure.
3.4.3 Improving loyalty by working environment
The office space is designed to enhance collaboration among employees, promoting the exchange of information across departments Important company updates are shared through an internal network and a printed newsletter, ensuring that all staff stay informed about Mobifone's business status However, attention to labor protection within the office environment is lacking To improve safety, Mobifone should invest in adequate fire and explosion prevention equipment, as well as essential resources for work, including electrical generators and guest accommodations.
3.4.4 Improving loyalty by training and career advancement opportunity
The company has implemented numerous training courses for its staff, but these programs lack specialization in their respective fields and fail to ensure that employees can effectively apply the knowledge gained in real work scenarios Annually, the corporation invests in full-time and in-service training programs for undergraduate, postgraduate, and Ph.D students Despite offering various professional skills enhancement courses, the effectiveness of these trainings in improving employee competencies remains questionable As a result, employees tend to believe that obtaining a degree is sufficient for career advancement, leading to a lack of focus on further developing their knowledge and skills.
The Corporation lacks a transparent and equitable promotion scheme that is accessible to all employees, leaving them unaware of the criteria for advancing to key positions like department directors and deputy heads Consequently, these roles are predominantly filled by external candidates, and there are no available managerial or leadership positions for current staff to aspire to This situation fosters a sense of futility among employees, as their efforts may only yield minimal recognition, such as being labeled "excellent employees."
MobiFone's Board of Directors prioritizes a warm, friendly, and fair working environment, fostering positive relationships among departments, business units, customers, and partners The corporation emphasizes empathy and open communication, encouraging employees to share their ideas and collaboratively address challenges Leaders engage with subordinates in a transparent and understanding way, and a grievance box has been established to ensure that employee complaints are heard and addressed by top management.
The company effectively motivates its employees through a well-structured compensation system that incorporates incentives and recognition Additionally, it fosters a strong team spirit by promoting a fair, courteous, and enjoyable work environment, complemented by team-building and outdoor activities These initiatives have successfully inspired employees to work diligently and remain committed to the organization.
Employees frequently express dissatisfaction with their basic salary, feeling it falls short of industry standards and expectations Additionally, they perceive year-end bonuses as merely compensating for their extra work rather than serving as genuine incentives Concerns also extend to training and promotion opportunities, as many employees doubt their chances for advancement and believe promotions are influenced by factors beyond job performance and competency.
Results of empirical survey
The author distributed questionnaires to 300 employees across MobiFone's nine regional units via email, allowing recipients to opt-in for participation A total of 249 responses were initially collected, with follow-up emails confirming receipt sent one week later For those who did not respond, the questionnaire was resent to ensure participation Ultimately, 245 responses were gathered, but upon review, 12 questionnaires were incomplete and 8 contained multiple answers for single items, leading to the exclusion of these invalid submissions Consequently, 225 valid questionnaires remained for analysis, providing a robust sample for the study.
Table 3.7: Characteristics of the sample by gender
(Source: Data collected by author)
In the sample, male employees represented approximately 63% of respondents, while female employees accounted for around 37% This mirrors the gender distribution in the MobiFone population, where males comprised 62% and females 38% Therefore, the sample effectively reflects the population's gender demographics.
Table 3.8: Characteristics of the sample by age group
(Source: Data collected by author)
The sample predominantly consists of respondents aged 26-35, representing 51%, which aligns with the population demographics Additionally, there are fewer respondents over 45 in the sample compared to the population, while the ratios for other age groups closely mirror those of the overall population Therefore, it can be concluded that the sample effectively represents the population.
Table 3.9: Characteristics of the sample by educational level
(Source: Data collected by author)
The data reveals that 76% of the sampled employees hold at least a university degree, while 12% possess a college degree, 8% have attended vocational school, and 4% are trained workers Although the sample is not flawless, it can be regarded as representative of the broader population, with corresponding figures of 85%, 10%, 3%, and 2%.
Table 3.10: Characteristics of the sample by year of service
Years of service Frequency Percentage
(Source: Data collected by author)
Approximately 80% of employees at MobiFone have been with the company for one to five years, with 45% working there for one to three years and 35% for three to five years This data indicates that MobiFone boasts a relatively young workforce, with an average employee age of 30.4 years.
Table 3.11: Characteristics of the sample by area
No Sample collected from No (people) (%)
2 Area 2 (TP Hồ Chí Minh) 23 10.2
4 Area 4 (11 tỉnh Tây Bắc Bộ) 20 8.9
5 Area 5 (13 tỉnh Đông Bắc Bộ) 25 11.1
6 Area 6 (Thanh Hóa, Nghệ An, Hà
7 Area 7 (Khánh Hòa, 05 tỉnh Tây
8 Area 8 (09 tỉnh Đông Nam Bộ) 26 11.5
9 Area 9 (12 tỉnh Tây Nam Bộ) 29 12.9
(Source: Data collected by author)
I feel proud to be a member of my organization
I proudly tell other people stories about my organizations
I actively promote my organization‘s product and service
I persuade my friends to use my organization‘s products, service
I work to achieve my company‘s visions and goals One of my goals is to help my organization achieve its goals and visions
I try to find ways to contribute more to my organization
I improve myself so that I can make more contribution to my organization
I would spend my whole life with this organization
My future lies with this organization
Location and transportation is convenient Necessary equipment are fully provided Workplace is safe and comfortable
Working hour is flexible and appropriate
Job requires variety of skills Jobs that are important for the company Jobs that offer timely and frequent feedback Jobs that match with ability
Promotion opportunities are equitable for employees There are plenty of for employees
Employees who got promoted were deserved
Pay is in line with job performance Salary is enough for meeting living expenses Salary is competitive in comparison with similar company Salary is equitable among employees
There are appropriate benefit and allowance Bonus are based on job performance
I work in a very friendly working environment
My co-workers are nice and helpful
My co-workers treat me in a polite and honest manner
I receive a lot of support from my co-workers
I can receive support from my leaders when needed
My leaders are trustworthy and reliable
My leaders are friendly and intimate
My leaders are committed and devoted to the jobs
I can learn a a lot from my leaders and supervisor
Recognition for employee include both financial and non- financial rewards
Employee are recognized for both long-term service and contribution
Criteria for recognition and rewards are clear and fair
The company provide timely and appropriate recognition scheme
3.4.2 Assessment of employee loyalty at MobiFone 3.4.2.1 Overall assessment
Table 3.13: Overall loyalty of employees at MobiFone
STT Nội dung Strongly disagree Disagree Neutral Agree Strongly agree Average
I feel proud to be a member of my organization
I proudly tell other people stories about my organizations
I actively promote my organization‘s product and service
I persuade my friends to use my organization‘s
I work to achieve my company‘s visions and goals
One of my goals is to help my organization achieve its goals and visions
I try to find ways to contribute more to my organization
I improve myself so that I can make more contribution to my organization
I would spend my whole life with this organization
My future lies with this organization
A recent survey revealed that employee loyalty at MobiFone is relatively low, with an overall average score of 3.84 across five dimensions, all below 4.2 Notably, the dimension concerning employees' identification with the company's values, vision, and goals received the lowest average score, with "I work to achieve my company's visions and goals" scoring just 3.39 and "One of my goals is to help my organization achieve its goals and visions" at 3.64.
The dimension of "desire to remain at the organization for a long time" received a low average score of 3.60, indicating uncertainty among employees about their long-term commitment Nearly 60% of respondents were unsure if they would spend their entire working life with the organization, and only 9% felt that their future was aligned with it Additionally, a significant portion of respondents expressed doubt about their future within the company, highlighting potential issues with employee retention and engagement.
The dimension of "readiness to introduce products or services" received the second highest score, averaging over 4.0 Specifically, the score for actively promoting the company's products and services was 4.02, while persuading others to use them scored 4.06 These results suggest that the quality of MobiFone's services is perceived as acceptable.
A recent survey revealed that pride in the organization is lacking, with only 11% of respondents strongly agreeing they feel proud to be a member, resulting in an average score of 3.69 Additionally, just 9% of participants expressed strong agreement that they share positive stories about the organization, leading to an average score of 3.92 Notably, 40% of respondents maintained a neutral stance regarding their feelings of pride.
Highest average score was observed for the dimension of ―Strive to contribute to the organization‖ with average score of 4.13 In which the item
The statement "I try to find ways to contribute more to my organization" received a high score of 4.14, while "I improve myself so that I can make more contributions to my organization" scored 4.13 These elevated scores suggest that the organization likely implements a contribution-based compensation system that incentivizes outstanding performance and contributions.
3.4.2.2 Difference in employee loyalty among genders, age groups and education
The data indicated that the mean score for employee loyalty
Table 3.14: Mean score for loyalty by gender
Gender No of respondents Mean Loyalty
Table 3.15: ANOVA result for gender
Sum of Squares df Mean
(Source Data analysis by author)
ANOVA results revealed a significant difference in employee loyalty between male and female employees, with males demonstrating lower loyalty to the organization This disparity may be attributed to male employees prioritizing promotions and salary more than their female counterparts, leading them to be more inclined to seek opportunities in other organizations for better outcomes.
Other ANOVA for age groups and education level did not result in any significant difference.
SOLUTION AND RECOMMENDATION
Summary of research findings
This research investigates the factors influencing employee loyalty to organizations, distinguishing loyalty from organizational commitment, which is often mistakenly equated with it Unlike previous studies, this research adopts a systematic approach to identify predictors of employee loyalty, utilizing loyalty-characterized behaviors as a proxy due to the challenges in measuring loyalty directly Through in-depth interviews with managers and employees, five key behaviors that define a loyal employee were identified: pride in the organization, promotion of its products and image, a long-term orientation, willingness to exert extra effort at work, and support for the organization's vision and goals.
This research explores how individual characteristics—such as gender, age, educational level, and tenure—alongside human resource management practices, impact employee loyalty It identifies seven key factors influencing this loyalty based on in-depth interviews with management and employee representatives: working conditions, job nature, promotion opportunities, salary, work environment, leadership, and recognition By understanding these elements, organizations can enhance their HR policies to foster greater employee commitment.
The results of the analysis showed support for all of the
In summary, the study validated that both individual traits and organizational practices significantly affect employee loyalty While certain individual characteristics are inherent and difficult to modify, perceptions can be shaped by management strategies Additionally, the influence of organizational practices on employee loyalty underscores the importance for management and policymakers to focus on these areas.
Some solutions to improve employee loyalty at MobiFone
4.2.1 Redesign the recognition and reward system
MobiFone should prioritize a thorough evaluation of its current recognition and reward system, as employee recognition is crucial for fostering a sense of importance within the organization An effective system not only acknowledges contributions but also enhances management effectiveness To achieve this, MobiFone must establish a clear recognition scheme with transparent evaluation processes and publicly announced rewards, guiding employees to align their efforts with the company's strategic goals Additionally, fairness and timeliness in recognition will bolster respect for leadership, while a balanced approach incorporating both financial and non-financial rewards is essential, as employees have noted a lack of financial incentives in the current system.
It is recommended to integrate departmental evaluations with a commendation committee to objectively assess employee performance and contributions within the corporation This approach ensures accurate documentation of employee achievements and demonstrates the commitment of upper management to recognize these contributions Consequently, providing recommendations to superiors regarding employee assessments is essential for fostering a culture of appreciation and accountability.
4.2.2 Improving loyalty via working condition
MobiFone employees rated their working conditions positively, identifying it as the second most important factor in their job satisfaction To enhance this further, leadership should focus on fostering a supportive work environment and organizing more extracurricular and community engagement activities that encourage participation from a diverse range of employees.
Leadership should enhance conditions for staff activities, particularly for business and working trips, to improve overall enterprise operations.
The company plans to revise its working time regime by implementing flexible hours to accommodate employee needs, particularly for female staff This adjustment aims to reduce travel time during peak hours and leverage advancements in science and technology to facilitate remote work, ultimately lowering business costs.
4.2.3 Improving loyalty via promotion and development
Achieving a promotion is a fundamental aspiration for employees, guiding their focus, consistency, and effort in the workplace When employees invest years of service and dedication without receiving a promotion, they may feel compelled to seek new opportunities elsewhere.
A recent survey revealed that promotion opportunities at MobiFone were viewed unfavorably by employees, receiving a low average score of 2.15 Many respondents expressed doubts about the fairness of the promotion process, suggesting that those who are promoted may not always be the most deserving candidates.
To foster employee loyalty and growth, the company should create promotion opportunities within the workplace While it may be challenging to implement this for high-level positions, mid-level roles are ideal for younger employees who demonstrate potential Encouraging healthy competition among staff in these positions can further enhance commitment and drive within the organization.
To enhance employee loyalty and performance, the company must implement training and promotion policies aligned with their capabilities Annual training courses are essential to support staff development and ensure organizational growth.
To enhance employee understanding and engagement, the company must clearly communicate its training policies, emphasizing its commitment to workforce development Identifying specific training needs and weaknesses is essential for creating effective policies that minimize training costs and optimize learning time Furthermore, it is crucial for the company to implement strategies that align trained employees with suitable job roles that match their expertise, ensuring both job satisfaction and productivity.
The administrative department should collaborate with relevant teams to accurately evaluate the training and learning needs of staff and interns This assessment will enable the development of annual training plans aimed at enhancing employee performance and overall productivity.
For employees, income is a crucial factor in job satisfaction and retention Even in similar roles and work environments, significantly lower salaries compared to peers in other companies can lead to high turnover rates Recent data indicates that MobiFone employees express dissatisfaction due to their salaries being below industry standards To improve employee morale and retention, it is essential for MobiFone to ensure that their salary levels remain competitive within the industry.
MobiFone needs to carry out salary survey and redesign their salary system based on intensive job evaluation
In times of economic hardship, it is essential for companies to implement a fair salary policy that reflects employees' contributions to motivation and loyalty.
In addition, the company should regularly inquire about the life of employees in the company to support policies as well as salary policy consistent with the situation
The accounting and finance department should reassess all expenses related to employee salaries and income It is essential to collaborate with relevant departments to accurately and effectively reevaluate wage policies and income structures based on staff capabilities.
4.2.5 Improving loyalty through working environment
A positive working environment is crucial for both managers and employees, as many have left their previous jobs due to excessive stress from coworker interactions Some companies manage their workforce in a manner reminiscent of a prison, instilling fear among employees, particularly women, who often face expectations to work overtime or remotely This pressure can lead to high turnover rates To combat this, companies must establish an effective work environment and fair income policies A supportive atmosphere fosters productivity, making it essential for organizations to promote open and enjoyable communication Employee feedback indicates that the work environment is a top priority For instance, MobiFone can enhance trust and collaboration through team-building activities and job rotation programs, strengthening relationships within and between teams.
Recommendations
The research findings have some recommendations for academics First, the results of in-depth interview support the view that employee loyalty is different from organizational commitment
Measuring employee loyalty can be challenging, which necessitates the use of proxies to assess it effectively Current research validates the use of loyalty-related behaviors as reliable indicators of employee loyalty Additionally, the findings support the identification of five key dimensions that characterize loyalty-driven behavior.
Research indicates that both individual and organizational characteristics significantly impact employee loyalty By changing employees' perceptions and implementing specific organizational practices, loyalty can be effectively influenced and enhanced.
To enhance employee loyalty, managers should prioritize policies that foster pride in the organization, such as recognition programs and a strong ethical code of conduct Long-term commitment can be bolstered through internal promotion policies that favor existing employees and offer training for advancement Additionally, assigning work based on employees' qualifications and preferences can further strengthen loyalty While a competitive benefits package is essential for retention, it alone does not guarantee loyalty, especially against enticing offers from other companies.
Management plays a crucial role in shaping employees' perceptions of the labor market and job opportunities by offering current information and emphasizing the benefits of working for the organization Additionally, investing in the development of a strong employer brand can enhance employees' pride in their workplace, fostering a positive organizational image.
A high quality relationship with leader can be maintained between managers and key employees in order to enhance the feeling of loyalty towards the organizations
Individual differences significantly influence employee attitudes and behaviors in the workplace This study highlights that the need for affiliation impacts employee loyalty Unfortunately, many Vietnamese organizations overlook this crucial information To enhance employee retention and satisfaction, Vietnamese companies should implement personality and personal traits surveys during the recruitment process to gather valuable insights on job candidates.
Limitations of the research
The first limitation of the research is about sample selection The main survey was conducted in just one company which might not represent the overall Vietnamese employees
The second limitation of this research is its cross-sectional design, which may not effectively capture the evolving nature of employee loyalty A longitudinal study would be more suitable for tracking the behaviors of loyal employees over time.
One significant limitation of the research is the reliance on self-reported questionnaires To enhance accuracy and reduce bias, it is essential that variables related to human resource practices be answered by the head of the human resources department or senior management.
Suggestions for further studies
Future research in this area should focus on longitudinal studies to better understand the evolving behaviors of loyal employees Additionally, incorporating group characteristic variables, which were not addressed in this study, could provide valuable insights in subsequent research Lastly, it is essential to conduct further investigations to identify a reliable proxy for employee loyalty.
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SURVEY QUESTIONNAIRE Phần I: Thông tin cá nhân
□ Công nhân kỹ thuật □ Trường nghề □ Cao đẳng - Đại học □ Trên đại học 4 Thời gian làm việc của anh/chị trong doanh nghiệp:
Phần 2: Xin anh chị cho biết ý kiến với những nhận định sau theo quy ước:
1: Hoàn toàn không đồng ý 2: Không đồng ý 3: Bình thường
Tôi tự hào là thành viên của MobiFone và luôn sẵn sàng chia sẻ câu chuyện về công ty Tôi tích cực quảng bá các sản phẩm và dịch vụ của MobiFone để nâng cao nhận thức và tạo dựng hình ảnh thương hiệu.
Tôi thuyết phục bạn bè sử dụng sản phẩm của công ty
Tôi làm việc nhằm đạt mục tiêu và tầm nhìn của công ty
Một trong các mục tiêu của tôi là giúp công ty 1 2 3 4 5 thực hiện được mục tiêu và tầm nhìn
Tôi cố gắng tìm cách đóng góp nhiều hơn cho công ty
Tôi hoàn thiện bản thân để có thể đóng góp nhiều hơn cho công ty
Tôi có thể gắn bó lâu dài với công ty này vì tương lai của tôi gắn liền với nơi đây Địa điểm làm việc thuận tiện và giao thông dễ dàng giúp tôi di chuyển dễ dàng Công ty cung cấp đầy đủ trang thiết bị cần thiết, tạo điều kiện làm việc an toàn và tiện nghi Thời gian làm việc linh hoạt và hợp lý, cho phép tôi cân bằng giữa công việc và cuộc sống Công việc yêu cầu nhiều kỹ năng khác nhau, đồng thời đóng vai trò quan trọng trong sự phát triển của công ty Tôi nhận được phản hồi đầy đủ về công việc, và nó hoàn toàn phù hợp với khả năng của tôi.
Công vieccj thách thức và thú vị 1 2 3 4 5
Cơ hội thăng tiến là bình đẳng cho mọi người 1 2 3 4 5
Công ty cung cấp nhiều cơ hội thăng tiến cho nhân viên, đảm bảo rằng những người được thăng chức đều xứng đáng với nỗ lực của họ Mức lương được trả tương ứng với kết quả công việc và đủ để trang trải cuộc sống của nhân viên Hơn nữa, lương cũng cạnh tranh so với các công ty khác, với quy trình xác định mức lương diễn ra một cách công bằng.
Có nhiều lợi ích và trợ cấp hợp lý 1 2 3 4 5
Thưởng được xác định dựa trên thành tích 1 2 3 4 5
Môi trường làm việc thân thiện 1 2 3 4 5