problem coca cola vietnam co ltd is facing and human resources management practices that affect the companys situation

This problem arises as a consequence of bad compensation and benefits policy, which can be seen in the salary rate offered by the company.. => The human resources management practice her

UEH UNIVERSITY COLLEGE OF BUSINESS SCHOOL OF MANAGEMENT

UNIVERSITY

FINAL TEST HUMAN RESOURCES MANAGEMENT

Lecturers : Ph.D Phan Quoc Tan

Course : Human Resources Management Students : Pham Anh Thuan — 31211023857

Course code : MANS502048

Ho Chi Minh City, 5th April 2023

Assignment

I Problem Coca-Cola Vietnam Co., Ltd is facing, and human resources

management practices that affect the company’s situation The main problem that Coca-Cola Vietnam encountered may be attributed to the whole situation as the leading cause, and that is Coca-Cola having a hard time retaining its employees The number of employees resigns up to 9% per year and it also results in a bad company’s business performance, they should be concerned about all of it So this serious problem needs to be solved as soon as possible In detail, the problems are: Firstly, it comes to the employees’ income The current basic salary of the employees is about 6,000,000 VND to 7,500,000 VND per month Especially for professionals with 4 years of experience or more, the basic salary ranges from 8,000,000 VND to 10,000,000 VND per month A number like that is quite alarming, especially for a company with such a vast scale, if not one of the biggest names in the worldwide industry This problem arises as a consequence of bad compensation and benefits policy, which can be seen in the salary rate offered by the company Everybody needs money to pay for utilities such as housing, food, bills, health care, and education Most people consider it a priority to at least earn a salary that allows them to cover these needs, have a reasonable quality of life, and have the ability to support their families So, is the salary that the company pays for

employees enough? If the answer is yes, why will this be one of the difficult factors for businesses in retaining employees?

=> The human resources management practice here is compensation and benefits The company needs to re-evaluate and adjust salary for employees to make them satisfied and then they will work more efficiently and effectively because the salary is one of the essential factors that boost the employee's motivation

Secondly, competent employees need to be recognized and promoted in their careers, but Coca-Cola Vietnam Co., Ltd has not focused on this issue, leading to many employees leaving the company in the hope to find themself being valued by another company Everyone always wants to be recognized and promoted when they work hard and try their best to dedicate themselves to the company People want to know that their hard work and achievements are not going unnoticed When a person achieves a personal goal or work- related, they feel a rush of achievement, and that good feeling is only amplified when others recognize and acknowledge the achievement as well, especially from the company they work for Moreover, celebrating strong efforts when employees go above and beyond helps them develop emotional connections to the workplace that fuel future performance But in this situation, the company doesn't pay attention to this problem, so good employees tend to look for a higher position in another organization

=> In this situation, human resources management is also about compensation and benefits, it is more about benefits The company needs to find a way to fix this problem because the incentive pay and promotion will motivate employees a lot, then they contribute to the organization’s success

Thirdly, one more bad hint can be pointed out is that leaders still think of employees as costs instead of investments, this is a conservative point of view that makes employees feel like they are not appreciated, which is one of the causes for the high quitting job rate Coca-Cola Vietnam identifies employees as the key to the company’s success and recognizes the importance of employee traming and development, ensuring the human resources meet the company’s medium and long-term development strategy but

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aspects, people have the capability to grow innovate products, and do countless other ñ Save toa Studylist bottom lines We can see that this problem m

=> There is traming and development practice, the employee needs to be trained to have great skills, not like a cost to reduce because of the more skills, more effective performance they can create

Finally, because of all of the factors above, one more problem appears, several key personnel leaving the organization have brought with them many customers that the new employees who recently jomed have not been able to regain, which is also a sign of a setback compared to the growing beverage market in Vietnam And then, Coca-Cola Vietnam Co., Ltd spends a lot of money on recruiting, training, and coaching these new employees to be able to work well Because the company has to recruit new workers to make up for the shortage of human resources who have moved or quit This partly leads to the company’s business performance, as it seems, it shows almost no increase, remains at a stable level and tends to decrease from 2018 to 2020 according to the Profit and Loss statement in 2018, 2019, and 2020, which significantly affects the company’s prospects, worries the shareholders, and is on the verge of losing the market shares This problem comes from the departure of key members of the company, alongside their customers which poses a threat to a setback compared to other competitors Additionally, for an enterprise like Coca-Cola, the new staff is not familiar with the market, and customers and does not understand the company, thus leading to uncertain business results It takes too many resources from the company but still doesn’t meet the expectation of managers, because new staff adapt to their work slowly For a giant name like Coca-Cola, high demand from the customers can only be met by the professionals, which many newcomers can not afford, leading to uncertain business results and growing vulnerability to the market environment

Hence, the practice that affects the company’s situation is performance management This practice is the way organizations use to provide information on day-to-day decisions about salary, benefits, and recognition programs Also, it evaluates and builds a plan to develop employees’ knowledge and skill

II Presenting the theoretical basis of relevant human resources management practices in the case

1 Theoretical basics of compensation and benefit practice Pay is a powerful tool for meeting the organization’s goals and a major cost It also has a large impact on the organization such as attitude and behaviors, it influences the kinds of people who are attracted to organization Beside that, employees attach great importance to pay decisions when they evaluate their relationship with their employer And when employees are satisfied with their salary, they will have a positive attitude and work engagement, there is a very effective way to retain employees with organization When the company makes a decision about pay, there are factors they need to concern First is job structure, next is the pay level, and the last is pay structure, pay policy resulting from job structure and pay-level decisions

Pay structures serve as a representation of an organization's policies, although the organization's real practices may differ In order to ensure that policies and practices are consistent, HR should compare actual compensation to the pay structure Compa-ratio is the usual method for doing this

About developing a pay structure, there are many issues that we should pay attention to Beginning with legal requirements, every employee has equal employment opportunity, employers must not base differences in pay on an employee’s age, sex, race, or other protected status If there are any differences in pay, it must be tied to such business related considerations as job responsibility or performance and potential So the goal is for employers to provide equal pay with equal work

Next in legal requirements for pay is mmimum wage Minimum wage 1s the lowest amount that employers may pay under law and it stated as an amount of pay per hour

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About the overtime pay, employees who work overtime are paid according to the unit price of wages or salaries Moreover, there are still regulations on maximum overtime Pay structure has 4 elements: salary by position, allowance, bonuses and benefits Mentioning salary by position, we have fixed payment to employees for performing specific job responsibilities Salary by position is determined on the basis of job complexity, working conditions, employee’s capacity level and market price This is the main income part of the total income of employees, in order to attract and retain employees Basic salary is calculated according to working time or product unit price and does not include additional payments such as overtime salary, incentive salary, etc and the basic salary is stated in the labor contract

Continuing, there is a pay level - deciding what to pay While governments establish a minimum wage, businesses are generally free to set their own wages However, it would be difficult to find an accountant for minimum wage Instead, you must pay the market rate To gather information about market pay, we can apply benchmarking, which is a procedure in which an organization compares its own practices against those of successful competitors through pay surveys, trade and industry groups, and also professional groups

We should pay attention to one point that employee judgments about pay faimess Employees compare their pay and contributions against three yardsticks: What they think employees in other organizations ear for doing the same job What they think employees holding different jobs within the organization earn for doing work at the same or different levels and what they think other employees in the organization earn for doing the same job as theirs

Job Structure, first is the relative value of jobs About job evaluation, administrative procedure for measuring relative internal worth of the organization's jobs, and compensable factors Second is defining key jobs, key jobs are jobs that have relatively stable content and are common among many organizations The organizations can make the process of creating the job and pay structures more practical by defining key jobs

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Research for creating the pay structure is limited to key jobs that play a significant role in the organization

Pay rates also play an important role The organization obtains pay survey data for its key jobs And then the pay policy line is established After that, pay rates for non-key jobs are determined Pay policy line is a graph showing the mathematical relationship between job evaluation points and pay rate Pay grade is sets of jobs having similar worth or content, grouped together to establish rates of pay

About pay ranges, pay ranges is a set of possible pay rates defined by a minimum, maximum, and midpoint of pay for employees holding a particular job or a job within a particular pay grade Red-circle rate is pay at a rate that falls above the pay range for the job and green-circle rate is pay at a rate that falls below pay range for the job

Pay differential is an adjustment to a pay rate to reflect differences in working conditions or labor markets; many businesses provide pay differentials based on geographic location, and the most common approach is to move an employee higher in the pay structure to compensate for higher living costs

The alternatives to Job-Based Pay First is about delayering, reducing the number of levels in an organization's job structure, also more assignments are combined into a single layer called broad bands and more emphasis on acquiring experience, rather than promotions Second is skill-based pay systems, pay structures that set pay according to employees’ levels of skill or knowledge and what they are capable of doing Appropriate where changing technology requires employees to continually widen and deepen their knowledge

Allowances meant to make up for working conditions, work complications, living conditions, necessity of labor attraction that are not taken into account or not adequately included in the wage corresponding to the tasks or positions on the pay scale

Now, we’re talking about the role of employee benefits Benefits show the concern of the employers to the employees lives, it also contributes to attracting and retaiming

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employees Different employees look for different types of benefits and employees have come to expect that benefits will help them maintain economic security Even though many kinds of benefits are not required by law, they have become so common that today's employees expect them Like other forms of compensation, benefits impose significant

costs

Benefits packages are more complex than pay structures, making them harder for employees to understand and appreciate The important role of benefits is one reason that benefits are subject to government regulation such as legally required benefits and tax laws, it can make benefits favorable

Optional Benefits Programs include paid time off for voting as well as paid time off for vacation, holidays, sick days, personal days, and floating holidays Employers may offer life insurance to employees or give them the option to purchase coverage at discounted group rates as part of group insurance With term life insurance, if an employee passes away during the policy's term, the employee's beneficiaries receive a death benefit payment, which is typically equal to double the employee's monthly salary, along with potential supplementary benefits such accidental death and dismemberment In addition, there is unemployment insurance, a federally required program run by states to lessen the hardships of being unemployed It provides payments to unemployed workers, assistance in finding new jobs, and incentives to stabilize employment The majority of its funding comes from federal and state taxes on employers Medical insurance is one of the most highly desired employee perks To control health insurance costs, many companies give coverage through preferred provider or health maintenance organizations, or they may offer flexible spending accounts

Upcoming is Retirement Plans About half of employees working in the private business sector have employer-sponsored retirement plans A contributory plan is a retirement plan funded by contributions from employer and employee And non-contributory plan - retirement plan funded entirely by employer contributions Additionally, a defined

contribution plan is a retirement plan in which the employer sets up an individual account for each employee and specifies the size of the investment into that account

About "Family-Friendly" Benefits, it includes family leave, child care benefits, college savings plans and elder care, etc Employers have responded to work-family role conflicts by offering family-friendly benefits

Other Quality of Work Life Benefits we focus on subsidized cafeterias, on-site health care services, moving and relocation expenses, employee discounts on products, employee buying service, tuition rermbursement, on-site fitness center, on-site dry cleaning services, dues for professional organizations, off-stte company recreation area and pet services Selecting Employee Benefits is decisions about which benefits to offer should be taken into account: organization's goals, objectives and budget, also expectations of the organization's current employees and potential future recruits and an organization that does not offer expected benefits will have difficulty attracting and keeping employees Legal Requirements for Employee Benefits 1s benefits required by law, tax treatment of benefits, anti discrimination laws and accounting requirements Employers must comply with numerous laws and regulations affecting how they design and administer benefits programs

Last but not least, that is communicating benefits to employees Organizations must communicate benefits information to employees so that they will appreciate the value of their benefits This is essential so that benefits can achieve their objective of attracting, motivating, and retaining employees Employees are interested in their benefits, and they need a great deal of detailed information to take advantage of benefits

2 Theoretical basics of training and development practice Training consists of an organization’s planned efforts to help employees learn job-related knowledge, skill, abilities and behaviors, with the goal of applying these on the job Training can benefit the organization when it is linked to organizational needs and

motivate employees A training program may range from formal classes to one-on-one mentoring and it may take place on the job or at remote locations

Detail about training linked to organizational needs The nature of the modern business environment makes training more important today than it ever has been Rapid change, especially in the area of technology, requires that employees continually learn new skills Also, the new psychological contract has created the expectation that employees invest in their own career development Moreover, an effective training program actually teaches what it is designed to teach and it teaches skills and behaviors that will help the organization achieve its goals Beside that, growing reliance on teamwork creates a demand for the ability to solve problems in teams, an ability that often requires formal training Furthermore, the diversity of the population, coupled with the globalization of business, requires that employees be able to work well with people who are different from them and successful organizations take the lead in developing this ability

Needs assessment is a process of evaluating the organization individual employees, and employee’s tasks to determine what kinds of training, if any are necessary, a variety of conditions may prompt an organization to conduct a needs assessment: First is management observes that some employees lack basic skills or are performing poorly, second is the organization has decided to produce new products, apply new technology, or design new jobs Final is outside forces such as customer requests or legal requirements may prompt a needs assessment The outcome of the needs assessment is a set of decisions about how to address the issues that prompted the needs assessment Needs assessment is aimed at organization, person and task Organization analysis is the process for determining appropriateness of training by evaluating characteristics of the organization It looks at training needs in light of: the organization’s strategy, resources available for training and management’s support for training activities Person analysis is the process of determining individuals' needs and readiness for training by answering three questions: Do performance deficiencies result from a lack of knowledge, skill or ability? Who needs training? and Are these employees ready for traming? Additionally, task analysis is the process of identifying and analyzing tasks to be trained To carry out

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