Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)

Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)Tái cấu trúc các doanh nghiệp nhà nước ngành xây dựng ở Việt Nam – Nghiên cứu từ trường hợp của Tổng Công ty Cổ phần VINACONEX (LA tiến sĩ)

Trang 1

Thai Nguyen University Southern Luzon State University Socialist Republic of Vietnam Republic of Philippines

DOCTOR OF BUSINESS ADMINISTRATION DISSERTATION

CORPORATE RESTRUCTURING

IN STATE-OWNED CONSTRUCTION SECTOR IN VIET NAM: THE CASE OF VINACONEX CORPORATION

Adviser: Dr Melchor Melo O Placino

Researcher: Nguyen Phuc Huong

Researcher ID: SLSU-DBA12009-21

Date of birth: November 30, 1975

Course: SLSU-DBA1 (2009-2013)

Trang 2

ACKNOWLEDGMENT

During completion of this study, the author has received significant support and

collaboration from many organizations and individuals

First and foremost, I take this opportunity to express my profound gratitude and deep regards to my guide Dr Melchor Melo O Placino from Southern Luzon State University for his exemplary guidance, monitoring and constant encouragement throughout the course of this dissertation

I would like to thank PhD Nguyen Ngoc Thang from Vietnam National University Hanoi, Tran Thi Kim Thu - Assoc.Prof PhD, Head of Faculty of Statistics - National Economics University and all my best friends who have supported and encouraged to complete my dissertation

I have to acknowledge the contributions of my colleagues at subsidiaries of

VINACONEX Corporation in the process of distributing to and collecting questionnaires

Without this support, I could not have gathered such huge database for research and analysis I also thanks go to all Vinaconex leaders, other state-owned enterprises leaders and some MOC managers

Special thanks goes to Thai Nguyen University and Southern Luzon State University for their cooperation in this training program which provides me with an opportunity to

participate in and conduct the project that I have long cherished

Last but not least, many thanks go to my family They are always beside me and encourage me through the duration of my studies I am also indebted this achievement to my

beloved wife and my children for their great help and support

Trang 3

DECLARATION

I, Nguyen Phuc Huong, hereby submit my dissertation for oral examination, entitled “PROBLEMS AND ISSUES IN CORPORATE RESTRUCTURING IN STATE-OWNED CONSTRUCTION SECTOR IN VIET NAM: THE CASE OF VINACONEX CORPORATION”, truthfully declare that the said paper is a product of my original research

investigation

Signed this 15" November 2013 at Thai Nguyen University

Trang 4

TABLE OF CONTENTS ACKNOWLEDGMENT .cccccsscessssseescseeecescseecscseescsesecsesesscaeseceessesesecsesessesesaeseesaesesesseesesesseeeeasees 1 DEGLLARAT TC tán nnnonoiiiaslDSD0141145846458455835833880999099901414443148845833583383999599991414443335895E8555833E8 2 IV 10219) 3209)00260 101518 3 LIST OF TABLES ID09):05160/:15SỀ225255 4/54 7 BS T.NIÁCTT sossstrttirittSS006202814)11EEESSSETEHEHTLEERGIASIAISEEERSSEEHTEHEETLGSEEBGIASIANISNERGEEEHIESEEIIRGSEERSISIAEISEERSSSE 9 CHAPTER I: INTRODUCTTION - (111191 3 1E vn HT HT HT Hàn HH nhiệt 10 lil; Backsround Of the Sty eee 10

1:2; ETOBIðO SESIETHETIbisosaeteeeososiiiiiiis444G4544510100440033933810803048GG4G4SGKIGISEISSISHANSM44884G14G400000083 13

1:3: Reseatch OD]€GHVES:giiccittittittGGGGGIRSGHARGBOSINGGXLGSISHISRIGGIINLBHSERGIEGG-A38343Đ80A8108098 13

1⁄4: RESGITEH QUGSHONS cnn RT ONES 14 I9 e 15

1.6 Scope and Limitation of the Study

1.7 Reseach Definitions

1.8 Significance of the Stdyy cá 5c 11211 1 1 HT TH TH TH HT TT TT TT TH 17

1.9, Structure Of the S†Udy - «cv knH TH TH TH TH TT TH HH 18

1.10 COPCÏUSÏOHN 11112111 1 1 1 11 HH TH TT TT TT TT HT TH TT TT HT 19 CHAPTER TI: LITERATURE REVIEW! :cccsscssssossvovesevesaeesverssecesirsasraesevevenrvesswensavevevesiecaononeniees 20

2.1 International related research

2:1 National related Teseatch snc S020025IEXGNGIQ-SRINBANGAVRSIOUNRGIEINNAlvvSiuatiea 29

2.3 Theoretical and analysing ÍTaImeWOTÍ - - -c- + t1 tk 1 1 1 vn nh nh nh HH Hàn nàn rưy 26 2.4 Analysing framework e:rrạạàđdađadđid 27 CHAPTER IIT: METHODOLOGY cccsccessssssescseeseeesseeecsesececseecsenecscseescesseessesesscsesecseecaesasesens 30

3.1 Determination of sample

Trang 5

CHAPTER IV: RESULTS AND DISSCUSION csccsesesesesesesesesceeesesessssssssesseseseseeeeeeesieseeeeeeeenes 32

4.1: Overview of the Vinaconex, Corporation sesesssssssssssssemeees eens 32

4:1 ;1 General information sessssssecssesesessesesessnseer er resenenarseriesmeseeen NETTIE 32 4.1.2 History of Vinaconex: Corporation cssssssssssnssnsansasemamennsanssnssnsansonssccansasnmmnnansssssnssnsansonsanen 32

Jlids MAM CIATACNGNCS OF VINKCOIE mmm aman 34

4:2 General pOwts cssssssssnssnssncanscsnmnmnansssssnsensansansancassansmamnsasasssnsensansaneassacemamannsanssusausansansaneansaann 36 4.2.1 Description ef respondents sccccsssccsssscssussssessessscnssssssssssssssssussussssssssssccnasssseesssssssuuseusessesseses 36 4.2.2 Verification of ratÏnE †OOÌS - ¿xxx v1 1 1 TT TT nh ng HH HH nh nh nh ng 39 4.3 Analysis on each issue relating tO restTuCtUring DTOC€SS ¿+ sss+vrsrsexrsrree 39 4.3.1 Reasons for restructuring of SOEs in the construction industry of Vietnam 39

“9n ốc ốc ốốốốố 42

4.3.3 SUQERY tigni55115110080 003 00A0230230304883381389383582330DD1A20239388138138383580010ĐIB03i23939498398381585835gg0300.l338 43 4.3.4 Conflict .ccececccececcceeeesesesescseseesesescscecscsescscscsesesecesscacseseseeeecsssesescsseseeescecssesssseseseeeeeeees 46

4.3.5 OWnership) senses ER 49

4.3.6 LeaderShIp óc cv ng nàn TT nh nh TH HH HH TH TH TH Thọ TT HH Hà Hà nàn 51

4.3.7 Employment

4.3.8 Technological ÏnnOVatiONI ác vn TH TT nh nh TH HH HT nh nh cty 57

4.3.9 Corporate GOVEMANCE L11111166666666665516261561460001411111646163345554501ã554450551111111144114345553513501350848E8 60

4.3.10 FÏnanCe ác HH Hà TH TH TT Tho nh TH Hà Hà HH TH TH TH TT TH Hà Hà Hà Hà cv 62

4.4 Analysis of differences in opinions of staffs at different ages about key Issues 64

CHAPTER V: FINDINGS, RECOMMENDATIONS, AND CONCLUSIONS - 67 Bln Fini 98 ssssssssnssnssnsansanemamnannsassanssnsnnsansancansasnmmnnansausanssnsansansaccassansmamnsansususeasansaneaseacemmmnnnens 67 §.2 Implications scsccsssccsssscssussssssssssscnosssssssssssssssussussussssessconssessssesssssssuussusussessssncessseesesssssssruuseuaesees 69 5.3 Limitation and recommendation for future research ccccesceeseseeseseeseeseseeessesecseseeseseseeseees 71

SA, Conclusion visssssssssssssenssnannnssnonsivensnsensnnennewnennennonnannavbienssnsnnennennennenaenasnnsnau eensensnennensensenaonasnnne a2

Trang 6

LIST OF TABLES

Table 1: The Workforce of Vinaconex

Table 2: Vinaconex’s contributed capital in subsidiaries and affiliates

Table 3: Vinaconex’s contributed capital in diffirent business sectors Table 4: Description of respondents

Table 5: Reliability Statistics

Table 6: Reasons for corporate restructuring

Table 7: Opinions of respondents about reasons for restructuring

Table 8: Opinions of respondents about competition during corporate restructuring

Table 9: Opinions of respondents in different job positions about Competition Table 10: Opinions of respondents about Strategy during corporate restructuring

Table 11: Opinions of respondents in different job positions about Strategy

Table 12: Pearson Chi-Square Tests

Table 13: Opinions about Conflicts regarding corporate restructuring

Table 14: Opinions of respondents in different job positions about Conflict in benefit

Table 15: Pearson Chi-Square Tests

Table 16: Opinion about Ownership in corporate restructuring

Table 17: Opinions of respondents in different job positions about the role of majority shareholders

Table 18: Pearson Chi-Square Tests

Table 19: Opinions about leadership in corporate restructuring

Table 20: Opinions of respondents in different job positions about the role of shareholders

Table 21: Pearson Chi-Square Tests

Table 22: Opinion about Employment in corporate restructuring

Table 23: Opinion of respondents in different job positions about opportunity to adjust

Personnel

Trang 7

Table 25: Opinion about Technological Innovation in corporate restructuring

Table 26: Opinion of respondents in different job positions about Technological Innovation demands

Table 27: Opinion about Corporate Governance in corporate restructuring

Table 28: Opinion of respondents in different job positions about Corporate Governance Table 29: Pearson Chi-Square Tests

Table 30: Opinion about Finance in corporate restructuring

Table 31: Opinion of respondents in different job positions about Capital preservation in

enterprises

Table 32: Pearson Chi-Square Tests

Trang 8

LIST OF FIGURES

Figure 2.1: Kurt Lewin’s Change Management Model Figure 2.2: An analyzing framework

Trang 9

LIST OF ABBREVIATIONS

VINACONEX: Vietnam Construction and Import - Export Joint Stock Corporation

VINACONEX-1: Construction Joint-Stock Company No.1 (Subsidiary of VNACONEX Corporation)

MOC: Ministry of Construction GDP: Gross Domestic Product

CEO: Chief Executive Officer

SOEs: State Owned Enterprises

CIEM: Central Institute of Economic Management SPSS: Statistical Package for the Social Sciences

BOM: Board of Managers

Trang 10

ABSTRACT

The study of corporate restructuring in state-owned enterprises has been the hot topic in the academic world However the interests of researchers have focused on investigating the phenomena of corporate restructuring more in the developed countries than in the developing world Little study has been done in investigating the corporate restructuring in state-own

enterprises in Vietnam This is the first study that devotes to explore the corporate

restructuring in a specific construction company in Vietnam This study aims to investigate what problems and issues arise to corporate restructuring in a construction company A typical five-level Likert item questionnaire was designed for the data collection We will analyze the problems and issues arising from the restructuring in construction sector, and the social impact of restructuring on the stakeholders The findings show that majority of

respondents strongly agreed with the reason that the restructuring resulted from their urgent

needs which aimed to help them come out of recession, or avoid bankruptcy In addition, the company’s restructuring decision was determined by the company’s internal and external factors Vinaconex need to pay more attention to training on management for managers and carried out technological innovation From the findings, we proposed some solutions to deal with problems arising from the restructuring for VINACONEX The result of study provides

more evidence for the theories about corporate restructuring and contributes to the growing

Trang 11

CHAPTER I: INTRODUCTION

1.1 Background of the study

Vietnam embarked on the Doi Moi (renovation) policy in 1986 Since then, the country has experienced radical changes, first and foremost in its fundamental economic thinking The centrally planned economy a-la-the Soviet Union was replaced by a market economy, albeit

of a socialist character, which started with a sweeping restructuring of the state-owned sector

This allowed the private sector to join the economy, which facilitated the process of full integration into the region and world mainstream During 20 years of Doi Moi, the gross domestic product (GDP) of Vietnam has seen sustained growth (Central Institute of Economic Management, CIEM, 2006) The rate of increase was 8.2 per cent each year on average in the 1991-1995 period, reaching 8.5 percent in 2007 (General Office of Statistics, 2008) The Doi Moi (renovation), economics growing, competition and globalization along with tightened fiscal policies are causing both private and public sector Vietnamese enterprises to strive for greater efficiency and higher cost-effectiveness In many cases the desired results cannot be

achieved without subjecting the corporate strategy and structure to some transformation In

this context, restructuring is no longer just an option It is a necessity for survival and growth (Cascio, 2002)

The major objective of Vietnam’s reform process is to create a market economy with socialist characteristics The enterprise reforms in Vietnam have three main components (Central Institute of Economic Management, CIEM, 2006) The first component comprises state- owned enterprises (SOE) privatization and restructuring to alleviate the problems that are impairing enterprises’ ability to compete The second component is to improve enterprise

behavior by establishing effective corporate governance mechanisms and_ strengthening

financial discipline The third one is provision of supporting institutions and infrastructure needed for a market based enterprise economy Key restructuring is the development of social

Trang 12

benefit programs to deal with the economy adjustments entailed by reforms, allow enterprises

to focus on their commercial objectives and long term strategy

Economic reform in Vietnam is shaped by several distinctive characteristics, reflecting

policy-imposed constraints and other special characteristics of the economy First, characteristic reflects the fundamental policy choice that significant public ownership and

control of industry will be retained This choice partly explains why enterprise reforms have

been so heavily focused on SOE (CIEM, 2006; Thang & Quang, 2007) Second,

competition is strong in many although not all industries (Martyn, 1995) The economic

behavior of enterprises has become increasingly responsive to market forces as a result of

competition, the growth of non-state enterprises, and management reforms to SOE The scope of public ownership has been substantially narrowed in recent years while the scope

for private ownership has been widened Third, most state-owned enterprises are the

relatively low level of revenues, which are partly a reflection of current structural problems (Dockery &Herbert, 2000)

Restructuring and privatization are now widely seen as important instruments of government policy for creating appropriate conditions for enhanced economic growth and

for redefining the role of the State (Cappelli, 1995; Morris et al 1999; Alkhafaji, 1992)

Many countries in every continent have in recent years embarked on projects to privatize

and restructure their SOEs, including Argentina, Chile and Mexico in Latin America; China,

Malaysia, Pakistan and the Philippines in Asia; the United Kingdom and France in Western

Europe and the transition countries of Central and Eastern Europe; as well as Cote d’Ivoire,

Nigeria and Togo in Africa Some industrialized countries, including New Zealand and the

United Kingdom, and several developing countries, such as China and Mexico, have

pursued privatization programs that are both radical and ambitious in scale and scope (Jun

Zhao, 2009 Diana et al, 1998)

Trang 13

Privatization and restructuring of the SOE sector in Vietnam is intended to concentrate state ownership and control on a core of large enterprises in strategic industries while withdrawing state ownership and support from small and medium-sized enterprises SOE restructuring is closely linked to the economic restructuring of the enterprise sector as a whole and to corporate governance reforms (CIEM, 2006) Creation of the strategic core of large SOE involves their conversion into modern enterprises and the formation of large enterprise groups

that will be able to compete against large foreign multinationals These groups face important

challenges in overcoming the present problem of their SOE and in sustaining the efficiency and flexibility that will be needed to compete successfully in international markets

In Viet Nam, the SOEs are holding a key role in the national economy and is making an important political mission in the country SOEs have occupied a big resource of the

economy; however, their contributions to the national economy have been limited in term of

contribution for GDP ratio, offering employment, Factors usage efficiency of production (land, capital, materials, etc) Specifically, the shortcomings of the SOEs and the need to carry

out necessary restructuring process as follows:

e Effective Business of the SOEs are more and more reduced, the financial situation of many SOEs are not safe and healthy Profitability from state capital is limited Many SOEs have been latent risk and disruption

e State policies of investment management have many shortcomings that limited investment performance of SOEs Results of SOEs perform tasks are not commensurable with the scale of resources invested

e There are too few specific rules, institutions to manage the Group's state economy, state corporations

Trang 14

e Government, ministries, industries, including the construction industry has project for restructuring the economy The construction sector corporations also simultaneously

make plan for restructuring the economy of its business; but actually implementing

specific process for restructuring the economy in the construction business are

confused, and have not actually achieve the desired effect

e Currently, Vinaconex is a corporation headed scale construction sector in Vietnam Vnaconex Corporation is kind of joint-Stock companies with controlled shares owned by State (> 51%) thereby Vinaconex has status as mentioned above Vinaconex recently has been processing corporate restructuring; however in the process of corporate restructuring, Vinaconexcorporation has faced many of the problems that

previous inadequacies was not fully foreseen

1.2 Problem statement

Being one of senior managers in VINACONEX, the author has recognized that research on

the topic “CORPORATE RESTRUCTURING IN STATE-OWNED CONSTRUCTION SECTOR IN VIET NAM: THE CASE OF VINACONEX CORPORATION” will benefit the

company in particular and construction industry in general The study aimed to draw a portion of system problems in the process of corporate restructuring of state-owned

construction enterprises, as well as to determine the practical significance to the construction

industry in particular enterprises and SOEs in Viet Nam 1.3 Research Objectives

The study devotes to explore the phenomena of corporate restructuring issues in the construction sector in Vietnam, particularly, the relationship between restructuring and firm’s performance The study tries to fill the gap of research on relationships between restructuring and financial performance in transition economies in Vietnam

The study works and explores on the following specific objectives:

Trang 15

(1) To determine the awareness of the managers of Vinaconex Corporation on the concept and the implementation of the corporate restructuring in state-owned firms in Vietnam

(2) To identify the main factors/problems and issues that affects the process of corporate

restructuring at Vinaconex Corporation

(3) To examine the effects on the ownership structure on the corporate restructuring of the construction sector in the SOEs

(4) To propose the most appropriate model for Vinaconex after restructuring

(5) To formulate policy suggestion to the government's to support business sector in

corporate restructuring

1.4 Research Questions

With the above objectives, the following questions are addressed to meet the objectives of this dissertation:

e QI: How do Vietnamese managers perceive and interpret corporate restructuring?

e Q2: What framework (factors/problems and issues) is used in analyzing corporate restructuring in Vietnam SOEs?

e Q3: How restructuring in the construction sector in SOEs affect the state shareholders

and the ownership structure?

e Q4: What is the most appropriate model for VINACONEX Corporation after

restructuring?

e Q5: What policy can be suggested in order to support a successful SOEs restructuring?

Trang 16

1.5 Hypotheses

During the study and based on the research issues, the following hypotheses are outlined and tested by using statistical methods to answer the research questions and to orientate the survey and data collection

H1: Restructuring will improve the competitiveness of the company on its core business H2: Restructuring will improve the situation on current ownership of the company

H3: Restructuring will improve the leadership and human resource management of the company

1.6 Scope and Limitation of the Study

Subjects of the study are almost Vinaconex Corporation (include head-office and all

subsidiaries of Vinaconex) The total number company of Vinaconex (subsidiaries) is 58

Which are 29 Construction, Real-Estate Company; 8 Production of construction materials

company; 10 Supply Power and Water company; 4 Insurance, Finance and Banking company; 7 Design consultancy and Services, trade company

The research instrument is survey with questionnaires, concentrated on leaders, managers, and experts

The actual survey data (primary) are conducted during the period from May, 2013 The secondary data are based on national statistics and company reports from 2010 to June 2013

Due to difficulties in identifying all Vinaconex company and other limitations, the sample is mostly in Vinaconex Corporation and some subsidiaries; therefore, the representativeness of

the sample will be limited

Trang 17

1.7 Reseach Definitions

Corporate restructuring is one of the most complex and fundamental phenomena that management confronts Each company has two opposing strategies from which to choose: to

diversify or to refocus on its core business While diversification represents the expansion of

corporate activities, refocusing characterizes a concentration on its core business From this perspective, corporate restructuring is a reduction in diversification Corporate restructuring

entails a range of activities including portfolio restructuring, financial restructuring, and

organizational restructuring (Gibbs, 1993) Accordingly, portfolio restructuring involves the redeployment of corporate assets through divestitures of business lines that are considered

peripheral to the core business strategy Significant changes in a corporation’s capital

structure are termed financial restructuring In organizational restructuring, the focus of change is on management and internal corporate governance structures

There are three major options for corporate restructuring includes arranging a sell- off to a strategic buyer, externalizing an independent entity, and liquidating (Achleitner, 2000 and Charifzadeh, 2002)

First, sell-offs as they are called, describe the sale of an affiliate company or business unit to a strategic buyer In these cases the buyer normally purchases the whole business unit in order to exert full control

The second group of restructuring concepts involve the separation of an independent entity, and include (i) change in ownership of the affiliate company from the parent corporation directly to its shareholders; (ii) break-up of a firm into two or more independent companies; and (iii), subsidiary initial public offerings (IPOs) and equity carve-outs Subsidiary IPOs

describe the partial sale of an affiliated company via sales of shares in the stock market in

which the holding corporation may lose its control over the affiliate Equity carve-outs

Trang 18

describe the sale of a minority participation of an affiliate on the stock market After this

transaction, the holding firm remains in control of the affiliate

Finally, the third class of restructuring options is liquidation, which is different from the first

two options because the individual assets of the unit are sold and the proceedings are distributed among its shareholders

1.8 Significance of the Study

SOEs have held the dominant role in the economic development To assess truly its role within the whole economy, it has been contributing to GDP, job and income generation and

national budget Therefore, SOE reform is a key element in the Vietnamese Government’s

programmed of the Doi Moi (renovation), under which mercerization and integration into the global economy are occurring The reform was intended to improve the efficiency and profitability of SOEs by reducing excess capacity, shedding surplus labor, lowering debt loads, and upgrading productive capacity In addition, it is to transform SOEs into market players by changing their ownership and management so as to improve the competitiveness in the global market

The economic effect of the restructuring programmed has had great impact on enterprise development and growth It is often believed that restructuring has a positive impact on the

performance of the company However, this is not always true in practice but its social

consequences are even troublesome One of these consequences, as some scholars already note, is a rapid transfer of state assets into the hands of managers and other private individuals (Ding 2000) Another emerging consequence is that the restructuring program has been accompanied by severe measures against workers, including collective layoffs, deprivation of benefits, labor rights abuses, and unstable working conditions Lacking effective state protection as well as organizations of their own, workers have become increasingly vulnerable by despotic managerial power (Lee 1999)

Trang 19

In order to achieve desirable economic and social results in the process of restructuring,

management should always have a plan of action if restructuring becomes inevitable At the same time, SOEs should not be left alone to carry out restructuring; governments too often feel the impact of the restructuring of enterprises, especially in situations where whole sectors or regions are affected The study will be not only answer the research questions but also expanding knowledge and experience in the field of corporate restructuring in general and in construction sector in Vietnam through the examples from VINACONEX

Corporate restructuring has been studied in Vietnam However, there are not many official researches on corporate restructuring in construction and Real Estate Corporation Thus, it is expected that the study will contribute not only in restructuring process for Vietnam but also systemizing and developing corporate restructuring issues in general and restructuring of

corporations in construction sector in particular More specifically, we studies restructuring

activities of SOEs in general and in the construction sector in specific VINACONEX will be chose for case study of enterprise restructuring The study analyzes the current structure and

proposes a new structure and management model for VINACONEX in the future The results

are expected to really contribute to completing restructuring process in VINACONEX

1.9 Structure of the Study

The dissertation consists of five chapters In chapter 1, the author introduces the research

context, scope and objectives, research questions, significance of study, and provides the outline and the structure of the dissertation

Chapter 2 aims to advance understanding of the corporate restructuring and indicate articles containing related information and data have been scanned

Chapter 3 focuses on the methodology of this study Sample of the study, research design,

questionnaire design, data collection and treatment method have been addressed I have

Trang 20

implemented a survey with sample of Vinaconex Corporation and 58 subsidiaries of Vinaconex

Chapter 4 concentrates on presenting, analyzing, interpreting the data from the survey

Finally, Chapter 5 summarized some key findings of the survey and provide implications, limitations and recommendations for future research This chapter provides and presenting the findings of this study and suggest model of corporate restructuring of Vinaconex Corporation This chapter also summarizes the contributions of this dissertation to theoretical and managerial implications Subsequently, this chapter discusses the limitations and presents directions and recommendations for future research

1.10 Conclusion

The purpose of this study is to indentify “CORPORATE RESTRUCTURING IN STATE-OWNED

CONSTRUCTION SECTOR IN VIET NAM: THE CASE OF VINACONEX CORPORATION”

Beside, the dissertation also indicates awareness about concept, the implementation of the

corporate restructuring of the managers in Vietnam and suggest about the policy of Vietnam

on Corporate restructuring

A drawback of this study is that it focuses mainly on the issues from the perspective of almost

the Vinaconex Corporation; therefore the representativeness of the study is limited This

should be taken into consideration in future studies

Trang 21

CHAPTER I: LITERATURE REVIEW

Restructuring of state-owned enterprises in general and specialized management enterprises in particular has been an issue concerned by international and national researchers, learners and managers and also a topic referred in international and national conferences Some relevant researches are as follows:

2.1 International related research

Restructuring and privatization are now widely seen as important instruments of government

policy for creating appropriate conditions for enhanced economic growth and for redefining the role of the State (Cappelli, 1995; Morris et al 1999)

In order to explore the roles different ownership structures, the joint effect of related and

unrelated diversification strategies, and previous performance levels have on the restructuring

strategies of such firms in China, the Author make clear understanding of restructuring strategies of Chinese business groups, by linking factors such as ownership structure, diversification strategies, and past performance to scope changes in these groups It can broaden our understanding of corporate restructuring in transitional economies, such as China and India Compared to other ownership types, government owned business groups tend to increase their business scope during asset restructuring, while private business groups tend to decrease their scopes through divestitures and spinoffs Poor previous performance is also found to be negatively related to change in business scopes The “match” between related and

unrelated diversification strategies of the business groups leads to increase in business scopes,

while “mismatch” between these two strategies tends to lead to decrease in business scopes (Jun Zhao, 2009)

During the past decade Wall Street practitioners devised various methods for converting

Trang 22

restructured with substantial debt with severe operational consequences The purpose of this

paper is to examine the reasoning behind such a boom in the hostile takeover activities It will discuss the importance and implications of restructuring, causes for corporate hostile takeovers and the defense strategies that effectively resist external acquisition (Abbass F

Alkhafaji, 1992)

Restructuring events, such as downsizing, can either halt a downward spiral in corporate

performance or perpetuate that downward spiral (Lindsley, Brass and Thomas 1995) This dual nature of downsizing is reflected in the mixed results found by prior researchers We

recognize the dual nature of downsizing by categorizing events according to the firm’s

financial condition preceding the announcement of the downsizing We find a significant negative stock price reaction for firms that are financially healthy in the period preceding the

announcement of the downsizing, but a statistically smaller reaction for firms that are in

financial distress The results suggest that the stock market views downsizing events consistent with the theory proposed by Lindsley, Brass and Thomas (1995) (Diana R Franz, Dean Crawford, Deborah J Dwyer, 1998)

Suggests that the corporate governance (CG) systems of transition economies in Eastern Europe may differ from those of industrialized countries and describes the governance system in Poland, which uses National Investment Funds (NIFs) under supervisory boards and the Treasury to deal with the restructuring of enterprises to be privatized Outlines the financial

market environment in Poland and the NIFs’ role within it; and discusses the CG issues arising

from the relationships between the NIFs and the supervisory boards Recognizes the problems involved but doubts whether the use of UK/US or German CG systems would solve them Hopes that the paper will provide a basis for further research (E.Dockery, W.E.Herbert, 2000)

Trang 23

2.1 National related research

General Secretary, Nguyen Phu Trong stated to end up 3rd Conference of Central Committee in 11th term — Communist Party of Vietnam (on Friday, October 10th 2011) and emphasized: in 2012 and coming years, Vietnam will give top priority to control inflation, stabilize macro economy and ensure social security closely associated with growth model renovation,

economic restructuring, focusing on 3 important aspects including restructuring of investment

especially public investment, restructuring of financial marketing, restructuring of SOEs especially State economic corporations and groups, etc

According to Nguyen Minh Phong (2012), restructuring of SOEs especially State economic corporations and groups shall determine to stop situation that the State economic corporations

and groups invest widely in aspects out of the sector and main business aspect The Third

Central Conference asked them to complete withdrawal of investment capital in the aspects out of the sector before 2015 and concentrate on developing SOEs in important aspects with key significance in the national economy The important aspects mainly belong to economic and technical specialty related to socio-economic infrastructure structure, public service, macro economy stability The conference studied, amended to reduce density to 10% lower and evenly early broke regulations which allow SOEs to invest maximum of 30% of total investment capital in aspects of out of the sector In the aspects of bank, insurance and securities, investment of state companies doesn’t exceed 20% of authorized capital of

beneficiary (the organization receives capital contribution); however, contributed capital of

holding company and subsidiary company in the corporation and group isn’t over 30% of authorized capital of beneficiary, etc

Management and activity mechanism of SOEs is renovated into that of joint stock companies

and limited ability companies in line with regulation of Business Law, equal competitiveness on the market (regarding business for profit-making), etc In a short term, it is necessary to amend inadequate regulations on business value defining, strategic partner selecting, preferred

Trang 24

stock selling to labor, etc Moreover, specify role of the owner or owner’s representative;

active production management right in the corporation required to be invested by the Government for general purpose; specify roles and responsibilities, rights of Board of Directors or Board of Members Especially, consistently and clearly decentralize management and involve individuals and organizations into taking responsibility for managing SOEs; publicize information, procedures, documents, list of projects; strengthen management, supervision, inspection, auditing of State projects Additionally, it is necessary for the state supervision system to add public investment regulations under supervision of the community, define rights and responsibilities of the community in supervising corporate activities, study and clearly regulate banned actions and strong sanctions to deal with violations at various levels, contribute to preventing negative actions and making legal basis to solve wrong-doings

in investment of SOEs, etc

To continue discussing restructuring pressure towards the economy in the coming time, Thang (2010) stated that if restructuring project is set up by a group of officials who

specialize narrowly in restructuring, lack information, responsibility and are affected by short-

term benefits, the project will be infeasible, inadequate and evenly will cause general loss for the economy

The Vietnam’s economy has been experiencing big restructuring period Basically, in general,

Vietnam’s economy has still remained general characteristics of an underdeveloped economy with backward sector structure, product and technology; inadequate labor structure and region; low competitiveness and high vulnerability, etc As the Directive by the Government, the project is aimed to “take advantage of favorable conditions to timely add, replace and newly equip with modern technology/machine and equipment system so as to stably develop the national economy” Restructuring consists of restructuring of economy, production

structure, investment structure, product and aspect structure, SOEs rearrangement and restructuring, etc

Trang 25

The major objective of Vietnam’s reform process is to create a market economy with socialist

characteristics The enterprise reforms in Vietnam have three main components (Central Institute of Economic Management, CIEM, 2006) The first component comprises SOEs

privatization and restructuring to alleviate the problems that are impairing enterprises’ ability

to compete The second component is to improve enterprise behavior by establishing effective corporate governance mechanisms and strengthening financial discipline The third one is

provision of supporting institutions and infrastructure needed for a market based enterprise

economy Key restructuring is the development of social benefit programs to deal with the economy adjustments entailed by reforms, allow enterprises to focus on their commercial

objectives and long term strategy

Privatization and restructuring of the SOE sector in Vietnam is intended to concentrate state

ownership and control on a core of large enterprises in strategic industries while withdrawing

state ownership and support from small and medium-sized enterprises SOEs restructuring is closely linked to the economic restructuring of the enterprise sector as a whole and to

corporate governance reforms (CIEM, 2006) Creation of the strategic core of large SOE

involves their conversion into modern enterprises and the formation of large enterprise groups that will be able to compete against large foreign multinationals These groups face important

challenges in overcoming the present problem of their SOE and in sustaining the efficiency

and flexibility that will be needed to compete successfully in international markets

Economic reform in Vietnam is shaped by several distinctive characteristics, reflecting policy-imposed constraints and other special characteristics of the economy First, characteristic reflects the fundamental policy choice that significant public ownership and

control of industry will be retained This choice partly explains why enterprise reforms have

Trang 26

non-state enterprises, and management reforms to SOE The scope of public ownership has

been substantially narrowed in recent years while the scope for private ownership has been

widened Third, most state-owned enterprises are the relatively low level of revenues, which

are partly a reflection of current structural problems

In conclusion, overview of researches above shows that local researches always approach the

problem in the direction of state management, seldom in the direction of corporate

management especially in the enterprises owned and controlled by the Government in the sector of construction and real estate

International and national restructuring researches are plentiful in content and approach The researches clearly indicate theoretical basis for corporate restructuring considered as a strategic solution to re-establish position, role in its own competitive business environment

Specifically, some restructuring researches have shown solutions in the sectors which are

mainly finance, bank, etc In Vietnam, restructuring has been studied at level of state

corporations, groups which are not owned and controlled much by the Government

Most above studies of the determinants of restructuring have been based on sample of firms Relatively little knows about why Vietnamese state-owned companies changes its structure Therefore, there is a need for restructring research studies using Vietnamese state-owned companies to provide additional insights regarding the determinants of restructuring In addition, there are not any official researches on corporate restructuring in the case of a Vietnam construction and real estate corporation in the view of a corporate manager Thus, it is expected that the research thesis contributes to not only building specific restructuring process for Vietnam Construction and Import-Export Joint Stock Corporation, Vinaconex

JSC But also systemizing and developing corporate restructuring argument in general and

restructuring argument of corporations and groups in particular in a developing country as Vietnam This study was designed to examine the relevance of the management theories in

restructuring an organization in the specific context The research result should fill this gap in

Trang 27

the literature in Vietnam context and provide practitioners as well as academics with both

theoretical and practical insignts

2.3 Theoretical and analysing framework

Change is a common thread that runs through all businesses regardless of size, industry and age Our world is changing fast and, as such, organizations must change quickly too

Organizations that handle change well thrive, whilst those that do not may struggle to survive

The concept of "change management" is a familiar one in most businesses today But, how businesses manage change (and how successful they are at it) varies enormously depending

on the nature of the business, the change and the people involved And a key part of this

depends on how far people within it understand the change process

One of the cornerstone models for understanding organizational change was developed by Kurt

Lewin back in the 1940s, and still holds true today Kurt Lewin’s Change Management Model

consists three stages of change His model is known as Unfreeze — Change — Refreeze, refers to the three-stage process of change he describes Lewin, a physicist as well as social scientist,

explained organizational change using the analogy of changing the shape of a block of ice

Understanding Lewin's Model: If you have a large cube of ice, but realize that what you want is a cone of ice, what do you do? First you must melt the ice to make it amenable to change

(unfreeze) Then you must mold the iced water into the shape you want (change) Finally, you

must solidify the new shape (refreeze)

4 A

yo CD

Trang 28

existing > Unfreeze => Change => Refreeze

ONAA

Unfreeze ~ Change ~ Refreeze

Figure 1: Kurt Lewin’s Change Management Model

By looking at change as process with distinct stages, you can prepare yourself for what is coming and make a plan to manage the transition — looking before you leap, so to speak All

too often, people go into change blindly, causing much unnecessary turmoil and chaos

To begin any successful change process, you must first start by understanding why the change must take place As Lewin put it, "Motivation for change must be generated before change

can occur One must be helped to re-examine many cherished assumptions about oneself and

one's relations to others." This is the unfreezing stage from which change begins

2.4 Analysing framework

Organizational restructuring involves major changes in the organizational structure for

enhancing the ‘efficiency and effectiveness’ of firms (Bowman & Singh, 1993) It involves reorientation of the business units to rearrange resources within a firm for better performance

According to Gibbs (1993), there are three types of corporate restructuring includes: (i) financial restructuring including recapitalizations and changes in capital structure; (ii)

portfolio restructuring involving refocusing on core business, resulting in change of the

diversity of business in the corporate portfolio; and (iii) operational restructuring including reorganization and changes in business level strategies

Trang 29

Corporate restructuring is intended to either reacting to crisis or to be part of the company’s

pre-emptive plan for their survival in the industry Restructuring process is a lengthy and a painstaking one It presents many challenging tasks and requires analysis of social benefits

and costs The most difficult task is to persuade the most suffered to understand the

desirability of the reform efforts (Soon, 2004) In the mean time, strategic evaluation of re-

engineering, restructuring and downsizing policies are perceived as the influential management paradigm With this, companies are able to fully leverage on their core competences in creating superior competitiveness (Tony, 1997)

Miller and Friesen (1984) suggested that the environment shift, technology changes, organizational grow and leadership changes are the reasons that lead to restructuring Massimo and Delmastro (2002) deemed that the adaptation of advanced manufacturing

technology and new human resource management practices favors organizational change

Miles, Covin an Heeley (2000) suggested that environmental dynamism impacts the strategies chosen by firms and moderates the relationships between organizational structure,

organizational strategies, and firm performance Moers (2000) suggested that restructuring is

also associated with strong market competition Jensen (1986) believed that the restructuring could be described as returning free cash flows to owrners The work of Hariison et, al (1991)

suggested that a significant amount of restructuring is associated with high levels of

diversification strategies, while the study of Hoskisson and Turk’s (1990) concluded that restructuring is primary directed at overcoming control problems that are associated with

diversification and that result in poor performance It is partially explained by free cash flow

Trang 30

relationship between the dependent variable (corporate restructuring) and independent

variables is presented in figure 1

Dependent variable Independent variables

Figure 2: An analyzing framework

Trang 31

CHAPTER III: METHODOLOGY

This Chapter presents the methods used for this research The methods in use show a combination between quantitative and qualitative research Data include secondary data from

statistical reports and primary data from survey by questionnaires The content of this chapter

includes (i) determination of Sample, (ii) research design

3.1 Determination of sample

This study used stratified sampling method at enterprises under Ministry of Construction,

some corporations, groups especially focusing on Vietnam Construction and Import-export

Joint Stock Corporation — VINACONEX and other companies under the Corporation Vinaconex Generally the sample size is as much as possible, but how much is enough

questions without clear answers

Thesis uses the Slovin’s formula to define the sample size for the survey:

N

n= b

1+ Neˆ

Where n: sample size

N: Population size that is more than 34 million totals staffs of Vianconex

e: Probability of error committed due to the use of sample instead of population The

error level in sample survey was chosen to be at 5%

Thus, the minimum sample size to conduct the investigations would be:

ne Ne 34201

~ 14+Ne? 1+34201* (0,05)? = 395,39 = 400 (population)

Thus, the sample size of the survey is 400 respondents

Trang 32

3.2 Research design

To collect data for this study, a questionnaire was developed in both English and Vietnamese as the instrument for the data collection The questionnaire was developed based on the

analyzing framework (figure 2) It consists of 35 statements related to competition, financial,

corporate governance, new business strategies, human resource management, conflict,

ownership, leadership, technology development, and company’s development in order to gain

in-depth knowledge on the issues A typical five-level Likert item (Agreement scale:

l=strongly disagree, 2=disagree, 3=neither agree nor disagree, 4=agree, 5=strongly agree) was used for this study (appendix La)

The data collection process took about | month in May, 2013 through the e-mail correspondence and complemented by a phone number to clarify some of specific issues We

sent 400 questionnaires to senior manager, medium level manager and non-managerial staff of

the selected of Vinaconex, other construction state-owned enterprises and some leaders of

Ministry of Construction of Vietnam Since the researcher have been working in this company for many years and knew most of the people in the company The respondent was supported for this survey In this survey, the researcher made it clear that the data will be treated as strictly confidential and will not be giving to third party without the respondent’s further

permission Some respondents had a difficulty understanding some of the business and

management theories and academic words such as corporate governance, new strategies, or human resource management The researcher therefore explained those concepts on the phone to them

We used both SPSS and EXCEL for data processing Tables are built by the SPSS software

while graphs are drawn by EXCEL We presented detail results of the survey in chapter IV

Trang 33

CHAPTER IV: RESULTS AND DISSCUSION

This chapter presents and analyzes the data collected from the survey about research issues

and to answer the research questions indicated in Chapter 1 Research results are based on data analysis and accreditation by statistics tools to ensure statistical reliability

4.1 Overview of the Vinaconex Corporation

4.1.1 General information

Name of corporation: VIETNAM CONSTRUCTION AND IMPORT - EXPORT JOINT

STOCK CORPORATION (VINACONEX)

Address: 34 Lang Ha, Dong Da district, Ha Noi city, Viet Nam;

Tel: (84 4) 62849234; Fax: (84 4) 62849208;

Website: www.vinaconex.com.vn;

Charter Capital: ~220 millions USD

4.1.2 History of Vinaconex Corporation

General Corporation Import Export and Construction Vietnam (Vinaconex) formerly known as Building Services Company and abroad, was established on 27.09.1988 under Decision No 1118 BXD/BXD-TCLD From a business management major activities of foreign

workers, determined VINACONEX multiple business objectives, product diversification,

multi-disciplinary activities, gradually building core links with businesses in the and abroad to develop and constantly growing According to Decision No 432 BXD/ TCLD on 08/10/1991 by the Ministry of Construction, the company was converted into Export Corporation Vietnam Construction, operating in the construction sector, export - import and export labor

export

To better meet the development needs of the new era, dated 20.11.1995 Ministry of

Trang 34

Export Corporation and Vietnam Construction modeled the Corporation 90 Accordingly, the

Ministry of Construction allows Vietnam Construction and Import - Export Corporation receiving several construction companies under the Ministry of affiliated corporations

At 31/12/2006 VINACONEX has 88 units of attached units, including 45 units with dominant

capital (holding more than 51% share) activities across the country with over 42,000 officials, engineers, professionals and workers Make the Decision dated 05.13.2004 84/2004/QD-TTg of the Prime Minister, Vinaconex is one of the State Corporation first pilot equalization of the whole company November 27, 2006, Congress established the General Shareholders

Company has been conducted and Vinaconex has officially come into operation in the form of

joint-stock company with a capital of 75 millions USD in Certificate of business registration No 0103014768 dated 01/12/2006 first registered by the Department of Planning and Investment in Hanoi

September 5th, 2008 shares of stock corporations and building export Vietnam (VCG)

officially trading on the Hanoi Stock Exchange

- November 2010, the joint-stock company and build export Vietnam successfully

issued shares to increase charter capital to 150 millions USD

- January 03, 2012, total equity firms export and build Vietnam successfully issued

shares increase its charter capital to 210,33 millions USD

- Currently VINACONEX has conducted corporate restructuring Currently (as at

june/2013) the VINACONEX Corporation has 58 units of attached units; including 33

subsidiaries with dominant capital (over 51%) operate nationwide with a staff of over

34,000 staffes, engineers, professionals and workers

Trang 35

3.1.3 Main characteristics of Vinaconex

Employees: Total numbers of Vinaconex’s employees to date on 31 December 2012 are

34.201 people which have 3.639 woman and 903 foreign workers, including:

Number of employee Qualification No (person) 1 Post graduate 210 2 University 5.695 3 College 715

4 Secondary and Primary 1.940

3 Technical workers 15.893

6 Unskilled Workers 9.748

Total 34.201

Table 1: The Workforce of Vinaconex

Source: Vinaconex annual report 2012

Investment capital in subsidiaries and affiliates: Vinaconex corporation has 58 subsidiaries and affiliates on 31 December 2012 Total contributed capital of Vinaconex is 4.986 billions

VND which are grouped into the following details:

Trang 36

No Type of companies Number of | Value of investment | Percentage subsidiaries | (million US dollar)

1 | Subsidiaries (over 50%) 33 174,30 73%

2 | Affiliates (from 20% to 50%) 5 26,95 11%

3 | Other companies (under 20%) 17 18,33 8%

4 | Joint venture 3 17,85 8%

Total: 58 237,43 100%

Table 2: Vinaconex’s contributed capital in subsidiaries and affiliates

Source: Vinaconex annual report 2012

The following table describes the percentage of Vinaconex’s contributed capital in different business sectors

No | Type of business sector Number | Value of investment Percentage of units (US million dollar)

1 | Construction, Real-Estate 29 75,57 32%

Production of — construction

2 8 106,62 45%

materials

3 | Supply Power and Water 10 33,52 14%

4 | Insurance, Finance and Banking 4 19,57 8%

5 | Services, trade 5 1,76 1%

6 | Design consultancy 2 0,38 0%

Total: 58 237,43 100%

Trang 37

Table 3: Vinaconex’s contributed capital in diffirent business sectors

Source: Vinaconex annual report 2012

GENERAL ASSEMBLY OF PARENT COMPANY SHAREHOLDERS MANAGEMENT BOARD | [ BOARD OF DIRECTORS |

Representative Excecutive Functional Subsidiaries Affiliates —- ni Offices Units; Project Departments of (over 50%) BH GẰẰỘ

Management Head Office Units

Figure 3: Organization Chart of Vinaconex 4.2 General points

Before analyzing the survey results, it’s necessary to mention general points relating to or

having impact on the analysis such as features of the respondents and verification of reliability of the rating tools

4.2.1 Description of respondents

General information about respondents of the questionnaires is as below:

Trang 38

Information Number of Percentage (%) respondents Male 365 91.25 Female 35 8.75 2 Age 20-29 26 6.50 30 - 39 98 24.50 40-49 76 19.00 50 and above 200 50.00 3 Job position Senior executives 111 QS Managing directors 128 32.00 Officers 161 40.25 4, Educational background College 8 2.00 Graduate 315 78.75 Post graduate 77 19.25 5 Work experience

Less than 5 years 15 3.75

5-10 32 8.00 10-15 209 52.25

15 years and more 144 36.00

Table 4: Description of respondents

The table above indicates that majority of respondents are males (91.25%) and only 8.75 %

are females (35/400 persons) This shows that majority of officers in the construction industry

Trang 39

are males (!) Of which over 52.6% of males are at the age of 50 or older (higher than the average level 50%) and only 23% of females are of this age (see appendix 1)

Regarding job position, 27.75% are senior executives (General Director, Deputy General

Directors, Directors, Deputy Directors, Chief of Trade Union, etc.), 32% are managing

directors (including directors of human resources, finance, directors of departments, managers

of divisions, etc.) and 40.25% are officers (such as Leaders of construction teams, accountants, officers in departments, etc.) This shows that most of respondents of the questionnaires are relevant to restructuring process in enterprises and nearly 60% of them are

executives, directors or managers of various levels It can be said that through these samples, the survey results are appropriate with the reality and will reflect reliably the research theme

Figure 4: Age structure based on job position

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Lanh daocaocap Lãnh đạo quản lý Chuyên viên M8 Từ 50trởlên M40-49 30-39 20-29

Also through Appendix 1, it is shown that 66.7% of senior executives are at the age of 50 and above, 29% of 40 — 49, and only 6.3% of 30 — 39 Meanwhile, the respective percentage

Trang 40

age of below 30 (see graphic 1) As a result, the average age of senor executives is much

higher than that of managing directors and officers Therefore, there will be different opinions about corporate restructuring which will later be analyzed in following parts

4.2.2 Verification of rating tools

All content of the questionnaires (except for the general information about respondents) use likert (order rating tool) for 35 items with 5 levels reflecting the consent of the respondents Before analyzing the survey results, it’s necessary to verify the reliability of this rating tool through Cronbach’s Alpha indicator (see appendix 2) The results are as follows:

Table 5: Reliability Statistics

Cronbach's | Cronbach's Alpha Based on N of Items

Alpha Standardized Items

0.693 0.679 35

The verification shows that Cronbach’s Alpha indicator is > 0.6, meaning that the rating tool used in the questionnaires are reliable and can be used as data for analysis

4,3 Analysis on each issue relating to restructuring process

Content relating to restructuring process in SOE in the construction industry are categorized

in 10 major issues such as reasons for restructuring of SOEs, matters to be resolved during the restructuring including competition, developmental strategies, finance, etc; issues on personnel, conflicts and issues relating to corporate management Below are opinions of respondents for each of above issues (for details, see appendix 3 & 4)

4.3.1 Reasons for restructuring of SOEs in the construction industry of Vietnam

Results for the 1“ issue “reasons for restructuring of SOEs in the construction industry” are shown as below: