Chuyên đề thực tập tốt nghiệp: A study on some effects of employee compensation On the work motivation of support division staff At a joint stock company in vietnam And some recommendations

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NATIONAL ECONOMICS UNIVERSITYFACULTY OF FOREIGN LANGUAGESDEPARTMENT OF BUSINESS ENGLISH

BUI THI HUONG LAN

A STUDY ON SOME EFFECTS OF EMPLOYEE COMPENSATIONON THE WORK MOTIVATION OF SUPPORT DIVISION STAFF

AT A JOINT STOCK COMPANY IN VIETNAMAND SOME RECOMMENDATIONS

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NATIONAL ECONOMICS UNIVERSITYFACULTY OF FOREIGN LANGUAGESDEPARTMENT OF BUSINESS ENGLISH

BUI THI HUONG LAN

A STUDY ON SOME EFFECTS OF EMPLOYEE COMPENSATIONON THE WORK MOTIVATION OF SUPPORT DIVISION STAFF

AT A JOINT STOCK COMPANY IN VIETNAMAND SOME RECOMMENDATIONS

Hanoi, April 2023

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Bui Thi Huong Lan-11192673-61B Business English

Firstly, I would like to express my great gratitude to my supervisor, Ass Prof.Dr Pham Thi Thanh Thuy for providing invaluable advice and support Herdedicated assistance and helpful feedback have significantly enhanced my researchpaper I also would like to thank the lecturers at the Faculty of Foreign Languages

for facilitating me to fulfill my ideas and complete my research.

Secondly, I want to express my sincere appreciation to Ms Nguyen ThiKhanh (HR manager) and a team of human resources specialists from VinhomesJoint Stock Company, who not only gave me an opportunity to intern andexperience a professional work environment but also allowed me to access to theirdata, which was very helpful to me a lot during the process of completing mygraduation thesis.

Moreover, I would like to thank everyone who responded to the surveyquestions Without their assistance, I could not have finished my research.

Last but not least, I am grateful to my family and close friends for theirencouragement and support along this trip They provide me with a lot of

inspiration and motivation which help me overcome challenges.

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EXECUTIVE SUMMARY

Employee motivation is a particularly interesting topic since it not only

expresses vitality and adaptability but also has a significant effect on the successor failure of the business The study aims to analyze the impact of employeecompensation on their work motivation with 72 suitable survey samples of SupportDivision staff at Vinhomes company This study used the techniques of

exploratory factor analysis and linear regression analysis The results of theexploratory factor analysis (EFA) indicated that there were 6 influencing factorswhich are (1) Salary, (2) Benefits, (3) Work, (4) Promotion and CareerOpportunities, (5) Working Environment, and (6) Leaders The results of linearregression analysis identified 4 factors that have a positive impact on workmotivation, according to the decreasing level of impact as follows Work, Leaders,Promotion, and Career Opportunities and Benefits.

From the research results, the authors have proposed some implications to

help the Board of Directors have good policies and solutions to positively affect

the working motivation of office staff, contributing to increasing labor productivityand bringing about business efficiency.

il

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Sig Significance level

SPSS Statistic Package For The Social Science

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LIST OF TABLES

Table 3.1: Summary of types of compensation affecting to work motivation of staff 27Table 3.2: Research hypotheses 5 5 kg ng 30Table 4.1: The reliability test results Of Salary 5555 s+Ssseereeereseee 33

Table 4.2: The reliability test results of BenefTfS . -+-<ss+ssssesssees 34

Table 4.3: The reliability test results Of WOTK sàn 35Table 4.4: The reliability test results of Work after adJustmen( 36

Table 4.5: The reliability test results of Promotion and Career Opportunities 36Table 4.6: The reliability test results of Work condition - «« «<<+ 37Table 4.7: The reliability test results of Work condition after adjustment 38

Table 4.8: The reliability test results of Relationship with leaders and colleagues 39Table 4.9: The reliability test results Of MOfIVAtIOH - c5 SsSsseeseeees 39

Table 4.10: The KMO test result of the independent variables - 41

Table 4.11: Rotated component matrix result of independent variables 41Table 4.12: The KMO test result of the dependent variable - - 43Table 4.13: The result of total variance extracted ce eeesseeeseceesseeeneeeseeeees 43

Table 4.14: The unrotated matrix result of the dependent variable 43

Table 4.15: Summary of variables - c2 c 32111331135 E1EEErerrrre 44Table 4.16: Research hypotheses - c1 11191 9 1119 1 1 11H ng ng 45

Table 4.18: Table of ANOVA ng HH ng HH ng ngự 47Table 4.19: Regression T€SUÏfS - 5 6 5 s1 vn HH ng HH ng ni, 48Table 4.20: Summary of the results of testing the research hypotheses 51

1V

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TABLE OF CONTENTS

ACKNOWLEDGEMENT NHƯiẳầẳầồđầđầẳđắaắđáũ - iEXECUTIVE SUMMA RYY - Ăn HH HH HH ng HH gà nrnưệt ilLIST OF ABBREVIA TIONS HH HH HH HH nh 11LIST OF TABLES - HH HH HH ng HH HH ivLIST OF FIGURES 111 VINTRODUCTION n - 1

1 The Significance of the SfUdy -. - - x11 SH ng HH Hiệp 12 Aims, Objectives and Research Questions of the Study - - -«- 23 Scope of the SfUdÌy kh HH HT HT HH HH HH nh nh trệt 24 Research Structure - HH TH HH HH HH HH 2CHAPTER 1: AN OVERVIEW OF VINHOMES JOINT STOCK COMPANYAND EMPLOYEE COMPENSATION POLICIES AT VINHOMES 4

1.1 An Overview of Vinhomes JSC oe eeccssesseeeecseessecsseesceseesseesseeseesaeense 41.1.1 The Development Process and Achievements of Vinhomes 4

1.1.2 Corporate Culture at Vinhomes JŠ - 5+ +« + ++s+seresees 6

1.1.3 Organizational Structure - <5 E11 vn nề 8

1.2 The Policies of Employee Compensation for Staff at Vinhomes Company 10

CHAPTER 2: LITERATURE REVIEẨW LH HH re 132.1 General Theories of Employee Compensation - -«++s<«+++s+ 132.1.1 The concept of employee compenSaf1OI -‹- « «<< <+sx<s+ 132.1.2 The main types of employee compenSafIOn - - «-s«+s«+s«2 13

2.2 The General Theory of Motivation for WOFK€fS - ccs« sex 19

2.2.1 The concept Of MOtiVAtION - - - c5 11+ 11 series 192.2.3 Some theories about IOfIVAfIOH - s6 5 s13 3 ren 21CHAPTER 3: RESEARCH METHODOLOGY .Ăc2ce<Ă2 27

3.1 Exploratory Study to Identify Types of Compensation 273.2 Research Model, Proposed Research Hypothesis and Variables 29E6" /À46))0.i(00ì 21 303.3.1 Scale of MeaSUT€IN€TI( G0 11 9319k HH nh r 30

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3.3.2 Survey Qu€SfIOTTIA]TC G2 1399113 11 9 11 811181 1 ng rệt 303.4 Data Collection and Processing 5 Ác 1k ng 313.5 Data AnaÏYSIS - nh HH HT TH HH HH TH Tnhh 313.5.1 Scale reliability anaÏyS1S - c1 S21 SH HH rệt 313.5.2 Correlation coefficient and linear regression analys1s 32CHAPTER 4: DATA ANALYSIS AND MAJOR FINDINGS 33

4.1 Types of Employee Compensation Affect the Work Motivation of SupportDivision Staff at Vinhomes JSC G111 HH HH key 33

4.1.1 Likert Scale Reliability Testing - 5 key 334.1.2 Exploratory factor analysis and the model adJustment 404.1.2.1 The analytical results EEA - s5 1S vn rưn 40

4.1.2.2 The model adjustment of research reSuÏfS - -«++s<«+++s+ 444.2 Analysis of the Effect of Employee Compensation on the Work Motivation

of Support Division Staff at Vinhomes JSC - cà sessrsrserrke 47

4.2.1 Linear Regression AnaÌÏyS1S - Ăn ngư, 47

4.2.2 Hypothesis 'T€sfInE - ch HH kg ngư, 51CHAPTER 5: CONCLUSION AND SOME SUGGESTED SOLUTIONS TOMOTIVATE EMPLOYEES AT VINHOMES JSC 55

5.1 Summary of EInITBS - s5 c1 91191191 9 112111 ng ng rh 55

5.2 Some Recommendations for Improving the Employees Motivation at

Mu co, 555.3 Limitations and subsequent direction of research - ‹ «++ss+ 585.3.1 Limitations of the ©S€aCHh - - 5 6 11931911191 991190119 vn rưy 585.3.2 Subsequent direction of research - - - + +x+sxcseesseesersrserske 593090130100111 ố 60

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INTRODUCTION1 The Significance of the Study

Any business that engages in production and business operations need tohave both human and material resources The importance of human resources inparticular is crucial to the growth of the organization When people are motivatedto work, their performance will achieve higher results, and the turnover rate willbe lower According to Arman (2009), employees are motivated, they will work80-90% of performance, and the leave and turnover rate will decrease Kovach(1995) also pointed out that the biggest problem of managers is to feel exactly thefactors that promote employees’ motivation Therefore, motivation for employeesis extremely necessary for business growth It also makes an importantcontribution to increasing productivity and quality of labor to help businesses

achieve their goals more quickly However, in order to retain employees, help themto be motivated to work, be ready to devote and attract talented candidates, the

organization must develop suitable employee compensation Understanding thisissue and having appropriate adjustment policies, companies will maintain anddevelop for a long time and have a foothold in the market.

Through the internship at Vinhomes Joint Stock Company, the author isaware that the company has attracted many potential employees but many of themdecided to leave the company less than a year later Recognizing that problem, theauthor thinks that the company's compensation is facing problems in creating

motivation and retaining its personnel.

For the company's growth, it is essential to create motivation for employeesin general and Support Division staff in particular However, in order to havesolutions to motivate office staff, the study on employee compensation as well asidentify the impact of each factor on the work motivation at the company isindispensable.

Because of the practical requirements, the researcher chooses the topic: “AStudy on Some Effects of Employee Compensation on the Work Motivation ofSupport Division Staff at a Joint Stock Company in Vietnam and SomeRecommendations” for her graduation project with the desire to improve the

efficiency of employees in the company and help them achieve the strategic goalsthat the company has set At the same time, the author wants to provide more

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experimental evidence for the theoretical foundation of the impact ofcompensation on the working motivation of the employee.

2 Aims, Objectives and Research Questions of the Study2.1 Aims of the Study

The study aims to assess types of employee compensation affecting themotivation of employees in the company and provide some recommendations topromote the motivation of these staff.

2.2 Research Objectives of the Study

(1) Identifying types of employee compensation affecting the working motivationof Support Division staff at Vinhomes JSC

(2) Evaluating the impact of employee compensation on the work motivation ofSupport Division staff at Vinhomes JSC

(3) Proposing solutions to improve the motivation of Support Division staff atVinhomes JSC.

2.3 Research Questions of the Study

Question 1: What types of employee compensation affect the working motivationof Support Division staff at Vinhomes JSC?

Question 2: How do the types of employee compensation affect the workingmotivation of Support Division staff at Vinhomes JSC?

Question 3: What are some suggestions to motivate Support Division staff atVinhomes JSC?

3 Scope of the Study

(1) Research subject: The impact of employee compensation on the workingmotivation of Support Division staff at Vinhomes JSC.

(2) Research scope: Only focuses on the staff of Support Division

(3) Contents: Motivation and employee compensation affecting work motivation.

(4) Time: From 2020 to 2022.

4 Research Structure

The study is divided into five main chapters:

Chapter 1: An Overview of Vinhomes Joint Stock Company

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This chapter provides general information about Vinhomes Joint StockCompany in terms of the development process, corporate culture andorganizational structure; and the policies of employee compensation for staff at

Chapter 2: Literature Review

The chapter two illustrates the fundamental conceptual framework relevantto employee compensation which consists of definitions and the main types.Moreover, this chapter also gave the concept of the term motivation and somepopular theories about motivation.

Chapter 3: Research Methodology

In this chapter, the introduction of participants, as well as the researchsample, research model, data gathering methods, and data analysis procedures,would be mentioned.

Chapter 4: Data Analysis and Major Findings

Based on the survey results, the author synthesizes the collected data, thenuses SPSS software to run the application model The processing results wereprovided and then interpreted the factors affecting the work motivation of Support

Division staff at Vinhomes Jsc At the same time, it also shows the level of impactof the factors.

Chapter 5: Suggested Solutions to Motivate Employees at Vinhomes JSC

The last chapter will include a summary of the research findings, somesuggestions for enhancing employee motivation at work, a discussion of the study'slimitations, and new research directions for future studies.

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CHAPTER 1: AN OVERVIEW OF VINHOMES JOINT STOCKCOMPANY AND EMPLOYEE COMPENSATION POLICIES AT

1.1 An Overview of Vinhomes Jsc

1.1.1 The Development Process and Achievements of Vinhomes

Vinhomes Joint Stock Company is a subsidiary of Vingroup According to

Wikipedia, it is currently one of Vietnam's top business organizations in the real

estate sector In the official website of Vinhomes, there are some importantmilestones referring to the development of Vinhomes Jsc:

2002: Establishing Vincom Joint Stock Company, formerly known as Joint Stock Company, the parent company of Vinhomes

Vingroup-2008: Establishing BIDV-PP Urban Joint Stock Company, the forerunner ofVinhomes with VND 300 billion in initial registered capital

2009: Renamed Nam Hanoi Urban Development Joint Stock Company2010: Increasing charter capital to VND 2000 billion

2011: Becoming a public company and being granted permission to register for

stock transactions at the Hanoi Stock Exchange (UPCoM) with the stock codeNHN.

Starting the project of Vinhomes Times City high-class complex urban areawith more than 12,000 apartments

2012: "Asia-Pacific Best Complex Project" for Vinhomes Riverside Urban Areaat the Asia-Pacific Real Estate Award

2013: Launching the construction of Vinhomes Royal City, a luxuriousdevelopment with around 5,000 apartments.

2014: Put into operation the project of Vinhomes Riverside high-class urban areawith the width of 183.5 ha

The best dual awards in Vietnam at the Asia-Pacific Real Estate Award of

the world's most prestigious real estate award program-International Property

Awards in two categories: -"Best Trade Center in Vietnam" For Vincom MegaMall Royal City - "Highly appreciated pharmaceutical complex project" for Royal

City Urban Area.

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2015: Putting into operation the Vinhomes Times City project with the friendlyecological architectural style of the Singapore island nation

The best dual awards in Vietnam at the Asia-Pacific Real Estate Award of

the world's leading real estate award system-International Property Awards in twocategories: -"Best Trade Center in Vietnam" For Vincom Mega Mall Times City -

"Best Complex Project" for Times City Urban Area.

2016: Putting into operation Vinhomes Central Park in Ho Chi Minh City- one ofthe most modern and advanced urban areas in Vietnam with more than 100,000

apartments, villas, and commercial townhouses

2017: Operating Vinhomes Golden River in Ho Chi Minh City- the most luxuriousurban area in the Saigon River and in the heart of District 1

The prestigious international real estate award system- International PropertyAwards awarded Vinhomes Metropolis "The best high-rise building in Asia-Pacific".

2018: Renamed Vinhomes Joint Stock Company, increasing the charter capital toVND 28365 billion and listed at the Ho Chi Minh Stock Exchange (HOSE)currently in the top 3 companies with the largest market capitalization in the

Vietnamese market

Launching the international great urban model and the sale of two projects ofVinhomes Ocean Park and Vinhomes Smart City Opening the tallest building inVietnam Lanmark 81 at the Vinhomes Central Park complex project, with 81

floors and 461 meters high

Vinhomes Riverside was honored as "the best real estate in the world" at theInternational Real Estate Awards held in London

2019: Product lines are being reorganized into brand lines, including VinhomesDiamound, Vinhomes Ruby, and Vinhomes Sapphire, while Vincity projects arebeing upgraded to Great Smart Project-branded Vinhomes.

The Guinness World Records awarded the title of " Urban area with saltwaterlakes and artificial freshwater lakes spreading white sand in the world" for the

Vinhomes Ocean Park Project.

2020: Vinhomes won the award "Smart City 2020" organized by the VietnamAssociation of Software and Information Technology Services (VINASA)

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2021: Deploying the O20 business model (Online to offline) promotes businessand multi-platform real estate transactions.

Vinhomes is the No 1 real estate brand in Vietnam, specializing in and high-class complex development, leasing, and management Projects by

middle-Vinhomes are strategically located in important provinces around the nation.

Vinhomes aims each of its houses to truly be "A Place Full of Happiness" bynot only constructing them but also providing a sophisticated and civilized livingenvironment.

More than 40 real estate projects are owned and managed by Vingroupnationwide but the Vingroup’s reputation does not stop at a huge scale but includeinvestments in Vietnam's quality of life that meet the highest internationalstandards.

From the beginning of the development of projects, Vingroup has developeda standard of living with a complete utility infrastructure system that inludes areasfor education, health, trade, cuisine, sports, culture, amusement parks, and garden In addition to convenient indoor areas such as hall, lounge, 5-star reception,community house, etc Vinhomes urban chain of Vingroup not only creates manyof the cities voted as "the most livable in Vietnam" but additionally aid inestablishing a new urban standard in the real estate market for middle- and upper-class housing.

1.1.2 Corporate Culture at Vinhomes JSC

1.1.2.1 The business philosophy of Vinhomes

Vinhomes aims to create products that are not only good for Vietnamesepeople but also contribute to building a famous Vietnamese brand, highlyappreciated in the world It can be said that Vingroup not only has the ambition tocreate great values for Vietnamese society in terms of material but also spiritualvalues for the nation, contributing to changing the face of the country Through theabove business views of Vinhomes" leaders, it can be seen that Vinhomes alwaysoperates consistently according to the common business philosophy: "Acceptingthe damage of themselves so as not to cause damage to customers already buy

products"

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1.1.2.2 Human Resource Management Philosophy of Vinhomes

Vinhomes Joint Stock Company always creates a professional, modern

working environment, maximizing working power, dedicate, develop and honor

workers and a harmonious combination of company interests with the interests ofemployees Besides, Vinhomes' 6 core values—"Credibility-Integrity-Creativity-Speed-Quality-Compassion"—serve as a framework for all of the company'soperations and are used by both leaders and employees to produce streamlinedpersonnel with both virtue and talent according to annual report of Vinhomes

1.1.2.3 Vision

Vinhomes is the top real estate development and management company inVietnam with the goal of becoming a world-class organization It is renowned forits outstanding scale, service quality, and execution speed, and it drives the market

to sustainable growth.

1.1.2.4 Mission

To provide the ideal living environment for Vietnamese inhabitants in urbanfor Vietnamese citizens in metropolitan areas, including well planned residentialcomplexes that are in harmony with nature, a green environment and integratedfacilities Vinhomes also nurtures its communities and develops a modern, lively,

and gracious environment As the results, its residents will enjoy a high standardof living.

The industrial ecosystems of Vingroup in particular and Vietnam's industryin general were accompanied and promoted by Vinhomes as it steadily developed

large-scale and influential industrial real estate projects.

1.1.2.5 Core values

Incredibility: Vingroup strongly protects its Credibility as protect itsreputation and makes an attempt to deliver its commitments by constantlyimproving its execution and deployment readiness capabilities

Integrity: Integrity lays the foundation for Vingroup where we strictly

adhere to the rules of the law and other regulations, prioritizing the interests of its

Creativity: Vingroup sees creativity as its vitalizing fuel for growth andembraces the entrepreneurial spirit to build a company that is always growing.

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Speed: Vingroup values Speed and Efficiency as the guiding elements of itsdecision-making — “Fast To Decide, Fast To Invest, Fast To Deploy, Fast To Sell,Fast To Change, and Fast To Adapt”

Quality: Vingroup’s commitment to operate with high standard is shown as:“Best in People, Best in Products and Services, Best in Quality of Life, anddelivering the Best in Society.”

Compassion: Vingroup values its connections with Compassion, seeing itspeople as its most significant resource, and balancing the interests of all

stakeholders on the principles of fairness, integrity, and solidarity.1.1.3 Organizational Structure

Transparency and efficiency are the two main goals of Vinhomes' corporategovernance strategy Vinhomes” Board of Directors is deeply aware that onlybuilding and operating the corporate governance system ensures that these criteriawill bring Vinhomes shareholders values and sustainable development Vinhomes,as a significant component of Vingroup, inherits the guiding principles ofcorporate governance and the company's core values Vinhomes is structured inaccordance with the most effective worldwide practices In particular, the role ofownership, management, and operation is separated The company's activities areorganized according to functional divisions, in charge of the fields in the valuechain.

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Prevention Division

Support Divsion

Smart City Division

Figure 1.1 Organizational structure of Vinhomes Jsc

(Source: Vinhomes’s official website)Support Division (SD) includes departments such as Human Resources-Training, Information Technology, and Administration This is a division thatplays a supporting role for Project Development Division, Construction Division,

Sales Division, and Operation Division to be able to perform the work effectively.

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Figure 1.2 The structure of Support Division

(Source Vinhomes’s HR department)1.2 The Policies of Employee Compensation for Staff at Vinhomes

Vingroup aims to develop sustainable human resources:1 Ensuring rights and equality for employees

2 Building a cohesive environment - strong culture

3 Focusing on training sustainable human resources

4 Engaging employees through collective and community activities

In the human resource development orientation, Vingroup puts a strongemphasis on developing a talent acquisition strategy, an adaptable and effectiveworking style, a scientific working environment, and an attractive compensationand reward policy.

Talent attraction policy: In order to both "retain talents" and "recruit talents",or attract brilliant people from a variety of sources to work for the company,

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Vingroup has a particularly competitive salary and bonus policy for talented andexperienced people in related sectors.

Working regulation: Vingroup organizes to work 8 hours a day, 5.5 days per

week, I-hour lunch break (leaves of holiday, Tet, sickness, maternity, etcaccording to state regulations) Vingroup has the right to ask workers to put inextra hours when ensure the corporation’s success, and provide satisfactoryremuneration for employees in addition to protecting their rights in compliance

with state laws.

Salary: In addition to salary adjustment when there is a change in volumeand scope of work, employees are considered for annual salary adjustments basedon factors (i) individual work results and quality (1) company performance (11)inflation rate and market wages.

Benefits: In addition to the fixed benefits as prescribed by law (mandatory

insurance, leave, periodical medical examination), the welfare regulation can be

adjusted annually according to business results and the policies of leaders.

e Support for lunch, special support, regime when going on business trips,support for staff shuttle buses

e Compulsory insurance according to State regulations (social insurance,

health insurance, unemployment insurance)

e Employees get periodic health check-ups once a year

e Vingroup Health Insurance: Employees can buy health insurance for

themselves right after signing the official labor contract.

e Extension of use of annual leave

e Expenses for parties, the anniversary of the establishment of the Group,

year-end party

e Gifts on holidays and Tet

e Regular travel and vacation

e Collective activities

e Establishing a mutual support fund to support employees in need

e Discounts on tuition fees for employees when using internal services ofVinschool, VinUni

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e Incentives for employees when buying Vinhomes houses for their own

e 13 monthly salary bonuses

e Reward for achievements: (i) reward employees for their achievements atthe end of the lunar year based on job completion, KPIs, and individual

contributions to the company; (ii) Commendation of individuals/groups

with outstanding achievements; (iii) Rewarding campaign and projectachievements

e Reward for employees who have good deeds and good deeds

As can be seen, Vingroup has always been committed to giving the most

professional, healthy and fair working environment for its employees.

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CHAPTER 2: LITERATURE REVIEW

2.1 General Theories of Employee Compensation2.1.1 The concept of employee compensation

Compensation is the actions of this object to other objects that are entitled tothe rights commensurate with their contribution (Le Thi Huyen, 2015) Thecompensation includes actions such as: behavior, treatment, and attitudes of theobject given benefits to the subjects creating benefits Therefore, employeecompensation includes a series of managers’ actions for workers whose actionscreate benefits for them These benefits are not only salaries or wages payment butalso related to the working process of workers, even when they have quitted jobs.

The process of taking care of workers’ material and spiritual life so that theycan fulfill the assigned tasks and thereby contribute to the achievement of thebusiness goals is known as employee compensation (Hoang Van Hai and et al.,2011) The combination of these two activities is necessary to create motivationand promote better work for employees in the business.

According to Hoang Van Hai (2011), compensation consists of two maintypes: financial compensation and non-financial compensation Financial

compensation is carried out through many tools such as salary, bonus, allowance,

etc Non-financial compensation is generally implemented through the work andthe working environment with specific activities such as joyfulness, interest,passion for work, fair treatment, respect, etc Financial compensation is a

necessary condition and non-financial one is a sufficient condition to retain staff.For most employees, income is the first motivation to motivate them to work.However, workers will work better when they are assigned to work in accordance

with their expertise, working in a comfortable environment From there, theirincome has also improved significantly Therefore, non-financial compensation is

a condition for employees to enjoy the best financial one.2.1.2 The main types of employee compensation

Employee compensation in the business is carried through two main types:financial compensation and non-financial compensation including the followingspecific activities

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* Basic compensation

The basic compensation is a fixed amount that the employee receives in theform of salary (weekly, monthly) or hourly wages Basic remuneration isdetermined by the particular type of work, the amount of work, qualifications and

seniority of the employee.

The wages are the amount paid to the employee depending on real workingtime (date, hour), the quantity of goods produced, or the amount of labor that hasbeen accomplished The wages are often paid to production workers and

employees who maintain machinery and equipment.

The salary is the sum that is consistently and regularly paid to the employee

in a given period of time (week, month, year) Officials and technical experts arefrequently paid salaries.

We can distinguish that the actual working time of the salaries is from thebeginning to the end of the labor contract, and the actual working time of wages isfrom the beginning to the end of the job Thus, salaries are often associated withstable jobs, and wages are often associated with the specific work quality.However, in fact, these two terms are frequently used interchangeably to describe

the fundamental compensation that an employee receives from the company.

* Bonus

These are the money that businesses pay to employees because they havecontributions and achievement that exceed the level and responsibility (Vu ThuyDuong and Hoang Van Hai, 2009, page 164) The bonus along with the salarycreates the main income of the employee Therefore, the bonus also helps workersmore fully meet the material and spiritual requirements of themselves and theirfamilies Bonuses might be considered the most powerful material motivator foremployees, especially those with potential and capacity Bonuses are financialincentives that are given once (often at the end of the month, quarter, or year) as

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payment for the employee's work The bonus can also be awarded unexpectedly toreward outstanding achievements such as completing the project earlier thananticipated, saving budget or having significant innovation initiatives Bonusesinclude many types: bonuses according to productivity, and quality; rewards for

saving materials; rewards for initiatives and technical improvements; rewardsaccording to business results; or rewards for completing the schedule earlycompared to the regulations.

* Shares

The shares are a form of compensation used to encourage long-termemployee loyalty and increase corporate responsibility Workers are given sharesof the organization, prioritizing buying or buying at low prices below the marketlevel This program is to make workers become a part of the organization, linkingthe interests of individuals with the interests of the organization, thus promotingtheir responsibility as well as their working efforts for them

* Benefits

The benefits are the amount that an individual receives from his or herbusiness in addition to the wages they receive In Vietnam, benefits are indirectremunerations that are organized to support workers’ life In most organizations,

managers are aware of the necessity of offering workers various types of insurance

and programs relating to their health, safety, insurance, and other advantages.There are normally two types of benefits which are mandatory benefits andvoluntary benefits:

Mandatory benefit is the minimum benefit that organizations must set at therequest of the law In Vietnam, the mandatory benefit includes 5 social insuranceregulations: sickness allowance, labor accidents or occupational diseases,

maternity, retirement, and death.

Voluntary benefit is the types of benefits organizations give depending ontheir economic abilities and the attention of business leaders, including the

following types:

(i) Insurance benefits:

e Health insurance pays for disease prevention such as physical trainingprograms to avoid stress when the stress effect is increasing in the

working environment or sick care;

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e Life insurance pays for the employee's family members when they die.

Maybe the employer supports a part of the insurance or the entire insurance.(ii) Guaranteed welfare:

e Income insurance is the payments for employees who have lost their jobs

due to an organization such as narrowing production, reducing payroll,reducing production demand and services, etc;

e Retirement assurance is the payments to employees with the number of

years working at the company according to the company prescribed whenthey retire.

(111) The money for paying time without work is the money paid for the timenot working by the agreement outside the law such as leave, breaks, personal

hygiene, tourism, etc.

(iv) Types of services for workers:

e Financial services are to help financially for workers and their families

directly related to their personal finances;

e Discount service: The company will sell products to employees at a cheaper

price or with more preferential payment methods such as installments withlower interest rates;

e Credit association is a collective organization that cooperates with each

other to promote savings among members of the association and createcredit sources for them to borrow at a reasonable interest rate;

e Shares of the company: Employees become the company owners by buyingsome stocks at preferential prices;

e Financial assistance: Some organizations make a loan to the employee to

help them buy some valuable assets such as house, car, etc the loan isreturned to the organization in the form of a gradual deduction from their

monthly salary.

(v) Social services:

e Training benefits: support partially or all funds for workers to study at

different levels related to work;

e Career services: Some organizations take their employees to serve workers

in the organization without losing money such as accounting advisors:

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Lawyers and accountants can help workers in the organization by givinguseful advice related to contract signing, or helping them find good lawyersto solve complicated cases Moreover, accountants help employees incalculating tax declaration or issues related to the financial declaration;Advice for employees: Some hire professional consultants and

psychologists to help their employees avoid stress, mental disorders,

marriage and family issues.

e Benefit for medical care: Organizations provide drugs, doctors and nurses

serving at organizations.

e Library and reading room: Some organizations equip with reading roomsand libraries providing specialized and entertainment books to help

employees broaden their knowledge;

e Entertainment services: Organizations provide entertainment services togive employees the opportunity of using their free time in a more useful

way to help them feel more comfortable, more connected and encouragethem to participate voluntarily at the same time.

e Sports and cultural programs: Some companies organize internalcompetitions with the outside

e Picnic program: In order to cohesive and expand mutual understanding,companies often organize annual travel days and picnics for their

In commercial enterprises, non-financial compensation is done through work and

the working environment:

* Compensation through the work

Work: For employees in the business, the work is considered as the necessaryactivities that they are organized and they have the obligation to complete Thework that the employee performs is very important since it is associated with their

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goal and incentive The job's requirements and standards have a significant effecton the employee's ability to accomplish their duties The employee will bemotivated at work and take ownership of the work outcomes if they are given animportant task that fits with their background, abilities, preferences, and personal

The attraction of the work: If the employee is assigned to more significant

tasks requiring higher qualifications, more experience, and higher salaries than the

current position or a job that offers many opportunities, the employee will feelmore attached and more responsible in doing the job.

Promotion opportunities: According to Stanton and Crossley (2000), the

opportunity to train and promote is what is related to employees' awareness about

the opportunities of training and developing personal competencies and beingpromoted in the organization In the model of Maslow's needs, the highest demandin all the needs is self-actualization We can see that all employees desire highpositions at work, thus they must be respected and assertive From the viewpointof the employee, a job that has compensated them needs to ensure the followingrequirements: (i) bringing the income worthy of their effort; (1) having a certainposition and role in business, (iii) being suitable for their professionalqualifications, skills, and experience, (iv) having the opportunity to promote and

develop, (v) stimulating their passion and creativity, (vi) work results must be

clearly evaluated.

* Compensation through the working environment

In the Human Resource Management textbook (Hoang Van Hai and Vu ThuyDuong, 2009), compensation through the working environment has carried out inthe forms such as: Creating a working atmosphere; Developing behavioralrelationships among colleagues; Ensuring labor safety and hygiene conditions;Organizing cultural and sports programs; Supporting union activities, andOrganizing the working time flexible and reasonable, etc.

According to Van Quy Manh (2014), compensation through the workingenvironment is expressed in three forms: working conditions, relations withleaders and colleagues and organizational culture:

Working Condition refer to the surroundings of the workplace Workingconditions include reasonable working hours, comfort and safety at work,necessary equipment for work and commute time from home to the company.These things all have an effect on the health and convenience of employees while

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they are at work Nguyen Van Long (2010) stated that working conditions are animportant factor affecting the level of labor consumption of workers during theproduction process Working condition is good or not shown through two main

factors that are the work and working environment The effective enforcement oflabor safety regulations, the purchase of specialized tools and equipment to boostoutput, and the enhancement of the workplace environment all contribute to better

working conditions.

Relationships with leaders and colleagues: The behavior of the leaderstoward employees is one important factor of non-financial compensation and hasa very strong impact on the working spirit of employees (Vu Thuy Duong, 2009).The characteristic of human relationships is communication activity, including

activities between leaders and employees and between employees The more andmore this activity is, the closer the relationships in the organization are There aremany employees of large companies who quit their job despite high salariesbecause the relationships with colleagues or superiors are not good Creatingmotivation for workers through the atmosphere is a very important measure tomotivate workers through mental stimulation Companies always maintain afriendly atmosphere, people respect and assist each other, the relationship betweenthe superiors and colleagues is not too stressful and the working style isprofessional will definitely establish a comfortable working environment for

employees Each employee always strives continuously and keep the workplacefriendly, facilitating to increase working productivity.

Organizational culture is the basis of all specific guidelines and measures inthe production and business of the organization, dominating the business results ofthe organization Therefore, it can be said that the success or failure of the

organization is associated with whether or not the culture of the organization is inits true sense.

2.2 The General Theory of Motivation for Workers2.2.1 The concept of motivation

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internal impact that stimulates the individual's goals to fulfill some of the needsthey expect.

Another approach of Vu Thi Uyen (National Economics University),

"Motivation = Desire + Voluntary, and Work Results = Ability + Motivation" Thisapproach considers motivation to be an inseparable part to create work results, anadditional factor to the capacity of workers to get the best job If the employee hasonly capability without motivation, it is difficult to get the desired results Studieshave shown that labor productivity fluctuates according to two variables of

capacity and motivation Therefore, improving the motivation of employees is toimprove the productivity of the entire business.

Labor motivation is the desire and volunteer of workers to increase effortsfor accomplishing the organization's goals (Nguyen Van Diem and Nguyen NgocQuan, 2007)

From the above definitions, we can give the most common understanding ofmotivation as follows: The motivation is everything to stimulate people to performbehaviors to achieve their goals.

2.2.1.2 Create motivation

To operate effectively, any organization needs to have timely and appropriateencouragement to their subordinates Through that encouragement, the staff willdevote all their efforts to benefit the organization "Encouraging is the promotionof people to work" (Nguyen Hai San, 2007)

Research on creating motivation for workers in the organization has beenmentioned by many authors Working motivation is the desire and willingness ofworkers to increase efforts to accomplish the aims of the company (Truong MinhDuc, 2011) In order to be motivated before all, there must be a need The desireto meet the needs will create motivation for workers The theory of motivation sofar has revolved around understanding the needs of workers to meet those needs.

Another definition said that "Creating motivation is a tendency to behave

purposefully to achieve unsatisfied needs" (Nguyen Huu Lam, 2007) In thisunderstanding, creating motivation is actions in a certain trend in order to satisfythe desires and demands that are missing.

"Creating motivation is to lead employees to achieve the goals set out withthe greatest effort" (Business Edge, 2007) This definition emphasizes the role of

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the leader The leader is the one who always interests, closely follows and leadsthe workers to work with the highest effort to achieve the goal of the organization.Although there are many different expressions, the above concepts have the

same meaning; encourage employees to work hard to increase the output quality

of the organization The definitions all refer to the main factors that createmotivation: Firstly, the subject of motivation is the leaders; Secondly, the objectsof motivation are employees, workers, and maybe middle-class leaders; Thirdly,the tool of motivating are policies and regulations that the leader uses to stimulateemployees to work hard to achieve the goals of the organization.

In the simplest way, the process of creating motivation is the process offinding and using appropriate motivational tools: starting from the study of theneeds and motivation of different individuals and based on the organization's goalsto select appropriate motivation tools.

2.2.3 Some theories about motivation2.2.3.1 Doctrine needs of Maslow (1943)

American psychologist Abraham Maslow introduced the concept of

Maslow's hierarchy of needs in his 1943 article "A Theory of Human MotivationHis hierarchy of needs is one of the best-known theories ever Maslow's hierarchy

of needs has five stages, starting with physiological needs and moving up through

security and safety needs, social needs, esteem needs, and self-actualization needs.This hierarchy suggests that individuals are driven to satisfy their mostfundamental needs before moving on to their more advanced requirements Fromthis theory, managers must be aware of their employees’ positions to encouragetheir employees by meeting their individual requirements.

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desire to become the most that one can be

respect, self-esteem, status, recognition, strength, freedom

Love and belonging

friendship, intimacy, family, sense of connection

Physiological needs

air, water, food, shelter, sleep, clothing, reproduction

Maslow’'s hierarchy of needs

Figure 2.1: Maslow’s hierarchy of needs

(Source: Simply Psychology website)Physiological needs such as the need for food, water, shelter, clothing, sleep,etc can be met through wages or income of workers in the enterprise Maslowshows this need at the lowest level At the workplace, a person must be satisfiedwith these lowest needs He must receive enough salary to support himself and his

family, must have lunch and take time to rest for work.

After physiological needs are satisfied, safety needs will arise People wantto be safe both physically and mentally Workers will not want to work onconstruction sites or shipyards without safety equipment to protect themselves Hewill also need to have a long-term stable job to ensure a life instead of doingtemporary jobs.

Similarly, the satisfaction of social needs is reflected in the satisfaction ofrelationships with superiors and colleagues as well as certain autonomy in carrying outthe job At work, employees will want to have lunch together, join the football teams,travel together or participate in other cultural and artistic activities These activities helpthe workers themselves motivated to go to work Besides, communication activities alsohelp workers develop community consciousness or teamwork.

According to A Maslow, when people are accepted in the organization willnaturally develop the need for others to be respected This type of demand isreflected in the form of power, prestige, status and self-esteem People always wantto be an important link in the organization so they often want to have a high

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position to be respectful Things that symbolize this demand in the organizationare shown as a car issued by the company, a private office, modern equipment, anassistant and rewards or certificates of merit for individuals to prove theappreciation of their capacity, experience or talent.

Maslow's hierarchy of needs places self-actualization at its highest level,where it is defined as the fulfillment of one's potential, the pursuit of personalgrowth, and peak experiences This demand is especially important for senioradministrators and business leaders because this is a driving force to motivate themto find new directions to bring more benefits to society Without self-actualizationneeds, there will be no successful entrepreneurs.

In general, Maslow's hierarchy of needs can be considered “perfect” for theestablishment of human needs from basic to advance However, there are somelimitations in this theory At the same time, people may have many different needsthat need to be satisfied, or there are also people who have not satisfied with basicneeds but they still have the need to be respected Moreover, there are also people

who are willing to sacrifice this demand to meet other needs.

2.2.3.2 The doctrine of the two groups of factors Herzberg (1959)

In the area of corporate management, Herzberg's two-factor theory is a

well-known theory of motivation Motivation and hygiene are the two components of

the theory Employee inspiration and engagement are the objectives ofmotivational factors including a sense of achievement and responsibility Salary

and working conditions are examples of hygiene factors which are necessary foremployees to maintain satisfaction in the workplace.

Thereby, the significance of motivation in bringing about a fulfillingemployment as well as the impact of hygiene issues contributing to employeeunhappiness are both demonstrated in the figure

Staff is not

dissatisfied but

Hygience Motivational Staff is satisfied

dissatisfied and factorsunmotivated

Figure 2.2: Herzberg’s two-factor theory of motivation

(Source: Carr, 2005)

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Motivation factors including achievement, recognition, growthopportunities, responsibility, and the nature of the work are considered intrinsicfactors Employees are satisfied at work if their needs are met, otherwise,employees will not be satisfied.

Hygiene factors include organizational policy, co-worker relations, income,and work environment If employees are satisfied, there will be no jobdissatisfaction, on the contrary, it will lead to dissatisfaction.

Hygiene factors when satisfied workers sometimes take it for granted but ifnot they will become discontented and thus production is reduced Lack ofmotivational factors will result in employees becoming unmotivated, lazy, anduninterested in their jobs, which leads to mental instability Therefore, Herzbergbelieves that motivation factors should be improved if managers want to have apositive response from workers.

From the above, it can be seen that employee motivation is influenced bywork-related factors, whereas working environment factors may sustain or destroymotivation Therefore, managers who would like to boost motivation foremployees should improve the working environment, create many chances andpromptly praise employees for their accomplishments, giving employees love,passion, and attachment to their work.

2.2.3.3 The doctrine of positive reinforcement BFSkinner (1938)

Theoretically, there are two categories of positive and bad behaviors that canbe present in employees Positive behavior is frequently rewarded and is likely tobe repeated, but negative behavior is restricted by tools of punishment and is rarelyrewarded, therefore it is likely to decrease The more quickly the punitiveinstruments are used after the act occurs, the more effective they are Employeeswill be negatively impacted if violations are overemphasized, so managers needto: (i) Develop behavioral standards in the enterprise: which behaviors areencouraged, which behaviors should be restricted, with corresponding rewards andpunishments; (ii) Implement fair reward and punishment tools with employees.

According to Skinner's research, managers must recognize and rewardsuccessful efforts in order to inspire employees to work more The focus onrewards is more productive than the focus on punishments.

2.2.3.4 Theory of Victor Vroom expectations (1964)

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Victor Vroom believes that people's motivations are influenced by how theyperceive their future expectations When there are expectations, the motivation toget people to work will develop based on the following factors: The individual'sability to solve work; The attractive reward for them; Belief in the organization's

no incentive to work or ambition and therefore require rewards to achieve goals.

Therefore, it is necessary to motivate them by accompanying disciplines,providing them with future safety needs (long-term job security) and bonuses

(money, advanced study, etc) to encourage them,

Nguyen Van Long in the study "Promoting human resources by motivation"

(2010) also pointed out that managers who worship the theory of "X" have twomotivational tools "stick and carrot" Because man is lazy and unreliable, he needsto be motivated by salary, reward, coercion, warning, and punishment.

Managers that adhere to Theory Y have a positive view of their employeesand use a decentralized and participative management style As a result, managersare encouraged to foster more trust and more regular communication among themembers of their teams.

This management approach implies that employees are: Happy to workindependently; More involved in decision-making; Self-motivated to completetheir tasks; Appreciate taking control of their work; Seek and embrace

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responsibility and require some guidance; View work as rewarding andchallenging; Find imaginative and creative solutions to challenges,

Thus, it is necessary to motivate them by giving them challenging tasks,

providing opportunities for them to move up the ladder of needs (self-actualizationand embracing power), and helping them be more creative and feel close toachieving their goals and making progress in their work.

Therefore, the manager's role is to facilitate self-development aspirations and

guide them toward the organization's overall needs in order to maximizeproductivity and efficiency The basic goals of both the manager and the managed

are met with sincerity and great potential is exploited.

The theory clearly shows that there are different groups of workers in the

same organization This will help managers have different motivational measures

for each group of employees However, Mc Gregor also shows his extreme viewof the two groups of workers in the "X" and "Y" groups, despite the fact that thereare many different groups of workers outside of them.

In general, each theory considers the motivation of workers on differentaspects However, the author found that the need theory of A Maslow is one ofthe most widely applied theories The theory that deals with the needs of the

individual is very specific and easy to apply So, within the framework of thereport, the author is mainly based on Maslow's hierarchy of needs theory toevaluate the impact of employee compensation activities on the work motivation

of Support Division staff at Vinhomes Jsc.

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CHAPTER 3: RESEARCH METHODOLOGY

Chapter 3- research methodology will present the research procedure, the

model and the variables, data collection method; tools, techniques and processes

that support data analysis to answer the research questions The entire procedureof the study will be done in the following steps:

Step 1 Identifying problems and aims of the study

Step 2 Conducting exploratory study

Step 3 Building models and variables for the studyStep 4 Building scale and designing questionnaireStep 5 Conducting survey and collecting data

Step 6 Using statistical tools to process the data

Step 7 Concluding problems of the study and giving some suggestions3.1 Exploratory Study to Identify Types of Compensation

The following table lists out a summary of types of employee compensationaffecting to work motivation of staff according to different relevant studies.

Table 3.1: Summary of types of compensation affecting to work motivationof staff

Types of employee compensation Researcher

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Promotion and Professional developmentopportunities

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at big universities such as - National Economics University, University ofCommerce, and Hanoi University of Technology For example, in the research ofNguyen Thu Trang (2013) salary and financial compensation has an impact on

employees’ encouragement Pham The Anh and Nguyen Thi Hong Dao (2013) alsopointed out that salary is one of the three important factors affecting directly thecohesion of the business Benefits and working environment have also beenapplied by author Tran Kim Dung (2005) when studying the satisfaction ofworkers in Vietnam.

Although the research of authors was done at different times, it shows thatthe motivation of the worker is associated with financial compensation such assalary, rewards, benefits, and allowances, etc and non-financial compensation such

as working conditions, working environment, etc The research results show that

the better these factors, the more the motivation of the employee is improved.3.2 Research Model, Proposed Research Hypothesis and Variables

From the theories and related studies, the initial linear regression model isproposed with dependent variables - the work motivation and independent

variables including income; benefits, work, promotion opportunities, working

conditions, and building relationships with leaders and colleagues.

Types of The workcompensation Promotion and Career motivation

Opportunities of staff

Working condition

Relationship with leaderand colleagues

Figure 3.1: Predictable research model

(Source: Summary from the previous researchers)

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Table 3.2: Research hypotheses

Hypotheses Content

The income level of employees is high or low, the

H1: Income ¬¬

motivation to work increases or decreases.

The level of interest in the benefits of employees in

H2: Benefit ¬ ; oo,

the same direction as their labor motivation.

The more appropriate the work is, the higher the work

H3: Work

motivation is and vice versa

H4: Promotion andCareer Opportunities

The promotion and career opportunities are highlyappreciated or low, the motivation of the employees

also increases or decreases.HS: Working

Working conditions are proportional to the motivationof the staff.

H6: Relationship withleader and colleagues

Building relationships with leaders and colleagues isconcerned, the work motivation is higher.

(Source: The author’s synthesis)3.3 Survey Questionnaire

3.3.1 Scale of Measurement

The five-level Likert scale was utilized in this study for all observations,

independent variables, and dependent variables, as follows:

Scale 1: Totally disagree

Scale 2: DisagreeScale 3: NeutralScale 4: Agree

Scale 5: Totally agree

3.3.2 Survey Questionnaire

The questionnaire was designed based on secondary data presented in theoverview of the research situation and developing hypotheses The initial

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questionnaire was consulted by the instructor and a number of surveys to adjustaccordingly Finally, the complete questionnaire is designed with the name:“Questionnaire investigating the impact of Employee Compensation on theWorking Motivation of Support Division Staff at Vinhomes JSC” includes

(1) Information about respondents such as full name, address, gender, date of birth,email, number of years of experience, and education.

(2) Information about the impact of employee compensation on workingmotivation is shown in the form of questions that reflect the assessment of eachfactor including income, benefits, work, promotion opportunities, working

conditions and building relationships with leaders and colleagues.(3) Information about work motivation in general

3.4 Data Collection and Processing3.4.1 Data collection

Due to limitations of research resources and research time, the authorconducted a survey through a questionnaire on a Google Forms The researcherthen makes a list of employees in the Support Division, finds their personal emails,

and sends the questionnaire to ask them to fill in the survey.3.4.2 Data processing

The author sent the questionnaire and collected 79 answer sheets Afterfiltering invalid votes, 72 valid votes remained, accounting for 91% During thesurvey, there are 07 votes that are not guaranteed to be valid because all answersare the same All valid samples will be data processed using SPSS 20.0 software.3.5 Data Analysis

SPSS 20 software has been used to analyze data collected and conductstatistical work in order to test the reliability of the scale and the implementationof statistics.

3.5.1 Scale reliability analysis

One of the aims of this topic is to build and test the reliability of the scale ofeach factor of the employee compensation affecting the motivation of theemployee at Vinhomes JSC Two coefficient-determining tools Cronbach’s Alpha

and EFA (Exploratory Factor Analysis) technique will help accomplish this goal.

Cronbach’s Alpha will check the reliability of variables used to measure each type

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