The poor experience in meal cost management in aeon mall viet nam

UNIVERSITY OF ECONOMIC HO CHI MINH CITY International School of Business - Ho Thi Nguyen Thien THE POOR EXPERIENCE IN MEAL COST MANAGEMENT IN AEON MALL VIET NAM MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – Year 2017 UNIVERSITY OF ECONOMIC HO CHI MINH CITY International School of Business - Ho Thi Nguyen Thien THE POOR EXPERIENCE IN MEAL COST MANAGEMENT IN AEON MALL VIET NAM MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: Dr Pham Phu Quoc Ho Chi Minh City – Year 2017 SUPERVISOR’S REPORT ON THE THESIS SUBMITTED FOR DEGREE OF MASTER of BUSINESS ADMINISTRATION The thesis title: THE POOR EXPERIENCE IN MEAL COST MANAGEMENT IN AEON MALL VIETNAM Student Name: HO THI NGUYEN THIEN Supervisor: Dr PHAM PHU QUOC General comments:  Remarks on the student’s attitude: …………………………………………………………………………… ……………………………………………………………………………  Remarks on the assignment’s academic quality: …………………………………………………………………………… …………………………………………………………………………… Overall assessment:  Meet requirement for submitting  Not meet requirement for submitting Other remarks:  Did the student follow the report schedule?  Yes  No  The Turnitin plagiarism percentage: Supervisor’s signature:  Other………………………… TABLE OF CONTENTS EXCUTIVE SUMMARY PART I – BACK GROUND INFORMATION Company information 2 Company symptoms PART II – PROBLEM IDENTIFICATION .5 Potential problems Theory informs and define the central problem 10 PART III – CAUSE VALIDATION 11 Possible causes 11 Theory informs and determine potential causes of the problem 15 PART IV – SOLUTIONS 20 The money solutions 21 The money – free solutions 22 The recruitment new managers 23 PART V – ACTION PLAN 24 Plan A: Retain the current managers 24 Plan B: Recruiting the new managers 27 Comparison and selecting action plan 29 REFERENCES 31 APPENDIX 1: INTERVIEW GUIDE .33 APPENDIX 2: TRANSCRIPT 34 APPENDIX 3: SUMMARY OF TRANSCRIPT .53 APPENDIX 4: QUESTIONNAIRE 58 APPENDIX 5: SUMMARY OF SURVEY .60 EXCUTIVE SUMMARY According to economist Milton Friedman, the main purpose of doing business is maximizing profits for its owners To this, it is necessary to minimize the organization’s cost through cost management and controlling process If it has some issues in cost management, company’s situation will be failure to get business purpose This thesis provides an analysis and evaluation of current problem about the poor experience in meal cost management in AEON Vietnam Co., Ltd and to recommend ways of solving this problem The thesis draws attention to the fact that the total number of employees has trend decreasing in months early of Y2017 Conversely, the average cost per person for meal is increasing Further investigations reveal that there are three existing problems: lack of experience to control situation, the big gap between number of order meals and the actual meals and the increasing in cost for per meal Moreover, this thesis also finds out the factors appear to be the major causes of these problem in AEON Vietnam Co., Ltd This thesis finds the prospects of the company in its current situation are not positive The major problems require further investigation and remedial action by management Based on analysis, some recommendations discussed include: how to retain experienced managers and setting up the other regulation to choose the industrial catering company The thesis also investigates the fact that the analysis and evaluation conducted have limitations Some of the limitations include: the information is not provided nature and the reasons cause the problem are not known clearly nor the data limitations as not enough information is provided or enough detail i.e the other hidden reasons details are not known and the old employees, who leaf company already are not present to be invited the in – depth interviews PART I – BACK GROUND INFORMATION Company information AEON is now one of the largest retailing groups in the world with over 179 member companies both inside and outside Japan Founded 1758, AEON Group with its history spanning over 250 years has one of the longest histories as a retailer in Japan During its operation, AEON Group has kept the unchanging commitment to putting “Customer First” AEON Group’s fundamental principles are the pursuit of prosperous and stable society and peace through the retail business Under this corporate accountability, AEON Group has won the customer’s trust widely and expanded more businesses not only within Japan territory but also in other countries in Asia for such a long period of time AEON Vietnam Co., Ltd has been presented in Vietnam since 2009, at first under format of Representative Office (1st Dec 2009 – 10th Jul 2012) On 7th Oct 2011, with the approval from People’s Committee of Ho Chi Minh City, AEON had set up its Vietnam Company Limited to invest for construction, organization, managements and trading of modern shopping malls, General Merchandises Stores (GMS), Supermarkets as a core business, and to carry out other business activities which links with import, export, trading, and researches Until now, the company has been developing with 04 the branches throughout Vietnam There are AEON Shopping Center – Tan Phu Celadon in Ho Chi Minh City, AEON Shopping Center – Binh Duong Canary in Binh Duong Province, AEON Mall Binh Tan in Ho Chi Minh City and AEON Mall Long Bien in Ha Noi, total charter capital is 192,383,000 US Dollar and total registered investment capital: 204,648,000 US Dollars The number of employees in entire mall is approximate 2,200 The internal structure one of the branch of company is showed in the graphic as follow: General Director Head of Human Resources Department Head of Sales & Marketing Department Head of Legal Department Head of Administration Department Head of Accounting Department Head of Purchasing Department Team 1, 2, 3,…, N Team 1, 2, 3,…, N Team 1, 2, 3,…, N Team 1, 2, 3,…, N Team 1, 2, 3,…, N Team 1, 2, 3,…, N Diagram – Company structure of AEON Vietnam Company symptoms Meals for company’s employees has an important role It not only provides energy and helps them relax and increase their productivity but also is a part of employee’s benefit that employees are paid Therefore, the service meal for employees is always paid special attention by business owners of AEON In AEON, both of full-time and parttime employees have the right to get this benefit from company Everyday, supervisors are responsible for counting and reporting the number of order meals to admin After that, leader will summary the figure and order to the industrial catering company Based on this number, the industrial catering company will prepare meals To control meal cost, AEON Vietnam gives the power to Administration Department to manage meal ordering progress and Accounting Department to record the meal cost A semi-annual, Administration Department will report the situation and result of controlling meals cost for Board of Directors and the other relavant departments In the meeting of the months early of Y2017 about the cost management in company, the Head of Administration Department already mentioned the increasing in meal cost for employees in head quarter and branches in months of Y2017 The below table shows the situation of these months in Y2017 compared with the same period Y2016: Unit: VND AVERAGE MEAL AVERAGE MEAL DIFFERENT PERCENTAGE COST Y2017 COST Y2016 Jan 672,887.32 463,969.24 208,918.08 45.03% Feb 529,304.25 322,805.51 206,498.73 63.97% Mar 604,511.10 361,110.78 243,400.32 67.40% 641,765.02 362,979.81 251,785.21 69.37% May 642,900.49 342,982.74 299,917.75 87.44% 636,161.37 456,326.78 179,834.59 39.41% Apr Jun Table – The average meal cost in months early of Y2016 and Y2017 (The data was provided by AEON Vietnam’s Administration Department) Following the report of the Administration Department, it shows that AEON Vietnam has problem in months of Y2017 in cost for employee’s meal Based on the comparision with months early Y2016, the meal cost of Y2017 is higher than its Y2016 This increasing rate goes up to 87.44% Specifically, the total number of employees has trend decreasing in months early of Y2017 Conversely, the average cost per person for meal is increasing The chart will show this trend as below: 800,000.00 700,000.00 600,000.00 500,000.00 400,000.00 Y2017 300,000.00 Y2016 200,000.00 100,000.00 Chart - The changing in average cost per one employee in months early of Y2016 and Y2017 (The data was provided by AEON Vietnam’s Administration Department) PART II – PROBLEM IDENTIFICATION Potential problems Following the information are conducted from in-depth interviews with Head of Administration Department, team leader, supervisor and accountant, who are working and have responsibility for meal cost management about the fact of meal cost management situation in AEON Celadon Tan Phu, AEON Binh Tan, Canary Binh Duong and AEON Long Bien, there are many potential problems for this symptom that cause the increasing quantity and price of meal as below: 1.1 Lack of experience to control situation: In the same period of Y2016, the situation is not like it in Y2017 In the same period of last year, the cost for meal is suitable with it’s employees But in months of Y2017, the meal cost is increasing although the number of employee trends of decreasing slightly The average cost per person is from 529,304.25 VND to 672,887.32 VND These figures are bigger than data of the same period in Y2016 The highest percentage of changing is up to 87.44% The current staffs not have understanding and experiences to solve problem of Y2017 deeply And they have not had any previous experiences to solve when the problem happend There are not many managers who have enough ability and experience to control the increasing meal cost Following the view of Head of Administration Department, “the number of experienced managers in AEON is small,…the experience managers quit job more and more” and “the turnover rate is about 10% per year” To solving this problem, the Human Resource Department has to recruit the new staffs who will be responsible for managing cost in the vacancy in company Because of this instability, the new employees have difficulty to find and solve the current problem which happend in the company now The new satffs cannot catch up with the the current staffs Futhermore, because of not using any machines to control the ordering, the process of calculating and forecasting meals for employees depends on the manual working of human absolutely As a consequence, it cannot avoid inaccuracy management 1.2 The big gap between number of order meals and the actual meals: Although AEON Vietnam has the chief teams to cook the food for customers With the professional chief teams, there are many delicious and safety food that are sold in delicatessen But they are not responsible for cooking the meals for AEON’s employees The company hires the third service company to serve the industrial catering Before the time for lunch or dinner, each of supervisor store will count and report the number of employees who will eat daily After that, the leader of admin team will summary the number and send it for the third service company to prepare the industrial catering According to the Head of Administration Department of AEON Vietnam, “because of lacking of responsibility of supervisor store and the leader of admin team in checking meal’s quantity, it makes the big gap between number of order meals and the actual meals” It is able to conclude the reason why it has the big gap between number of order meals and the actual meals is not exact number of order and actual meal’s quantity There are not only lack of responsibility of supervisor store and the leader of admin team in head quarter and branches but also changing in number of employees daily that cause the deviation of order meal’s quantity Because of the characteristics of the supermarket and retail sector, the rate of part-time employees in AEON's labor structure is high, it is difficult to predict the number of part-time employees working in a day exactly These people are sometimes absent without supervisor store’s agreement So that the quatity of part-time employees is variable The table in the report of Head of Administration Department in the meeting of the months early of Y2017 shows the situation of this problem in head quarter and branches in months in Y2017: issue It involves in individual employees And it is difficult to determine who has lack of responsibility in working Interviewer: With the current situation, you intend to solve it? Interviewee: To solve this problem, it requires the efforts of the relevant departments The role of management should be strengthened It is important to have someone control the number of meals correctly And our company should have more power in deal price of unit meal with the industrial catering company Interviewer: How about the effectiveness of these solutions? What you think? Interviewee: I think they are good solutions to make situation better Interviewer: Would you arrange of efficiency of the solution based on priority? Interviewee: Setting a tight controlling system to avoid wasting number of meals is the first And after that, it is necessary to improve the power of AEON’s negotiation Interviewer: Ok, the last one, anything else you want to share with me? Interviewee: Not at all Interviewer: I hope that our company will find out the exact causes of the current problem as soon as possible Based on these causes, we can propose optimal solutions to solve and improve the situation Can I contact you again whenever more questions arise? Interviewee: Yes, I am pleasure Interviewer: Thank you for your supporting Interviewee: No problem Interviewer: Goodbye and see you later Interviewee: Goodbye 52 APPENDIX 3: SUMMARY OF TRANSCRIPT QUESTIONS Trans Trans Trans Trans A Interviewee’s information: name and position in the company Name Thuy An Tram Chi Could you Head of Team leader in Supervisor Accountant introduce yourself Administration Administration and your position Department Department 2012 Since March of years ago When AEON in company, please? How long have you worked in 2017 Vietnam was AEON Vietnam? found until now Could you tell All tasks, which Making work Check the goods Making financial me something are related to permit in and ordering report, taxation about your daily administration Vietnam for meals for and write down work, please? activities and foreign employees transactions, solve the cost employees and which are related problem in controlling to company company system to booking air tickets and ordering meals, checking actual meals for employees Summary All of interviewees are the employees of AEON Vietnam and they are related to controlling meal cost B The current situation/problem in your work: 53 Could you Although the total The gap Some of The total number describe the number of between employees of employees has increasing meal employees has quantity of order ordered before but trend decreasing cost in detail? trend decreasing meals and actual after that, they in months early in months early meals not eat meals of Y2017, the of Y2017, the average cost per average cost per person for meal is person for meal is increasing increasing How long has months early of Since January of this problem Y2017 2017 N/A Started in months early of began? Y2017 How does it The number of It is getting trend? employees does worse N/A It is serious Do not know Yes not increase but the cost for meal increased Does it occur in Yes Yes all branches? about other branches PROMPT: What Less the number Better N/A The effective of is difference? of employees and controlling cost managing the better cost system and have system managing system a machine for counting the number of employees Summary The current situation of AEON Vietnam is the increasing of average cost per person for meal C Discover the causes: What does The experience Employees Some of The increasing in cause the cost of managers quit job order meals but employees price of one of meals increase? more and more they not eat ordered before but unit meal meals after that, they not eat meals 54 PROMPT: Why? No career The bad quality The bad quality of The failure in opportunities of industrial industrial catering negotiation with catering industrial catering company Overload working Stress Individual’s Individual’s problem problem Low price No refund money if they not eat meals makes them feel free to order Anything else The price that makes increases slightly That’s on increasing in meal Not stable number Lack of of part time responsibility of employees daily admin and cost? supervisors Although our company has the canteen and it has surplus food, our company hires the industrial catering company PROMPT: Why? The failure in The food hygiene negotiation with and safety industrial catering company, no bidding Based on what Difficult to Lack of Employees order Lack of you have found, determine the controlling in meals but they responsibility of what is the main main cause make checking not eat meals admin and cause make increasing of number of increasing of meal meal cost actual meal supervisors cost? 55 What are the The failure in Controlling the Employees order Lack of causes that are negotiation with number of order meals but they responsibility of difficult to solve industrial catering meals and actual not eat meals admin and them? company, no meals to bidding minimize the supervisors number of surplus meals Summary The causes: The bad controlling system; The failure in negotiation with industrial catering company; The price increases and the big gap between the number of order meals and actual meals D Discussion about proposal for the future: With the current Develop the Use a counter Assign tasks to The role of situation, you ordering and machines to staffs to control management intend to solve it? counting process know exactly the number of should be the actual employees who strengthened number of meals will eat or not Need an Have more power experienced in deal price of management team unit meal with the industrial catering company Choose catering companies by using the bidding How about the One of solution Conflict effectiveness of has its own between other solutions? benefits improving meal What you quality means think? increasing costs N/A N/A and find solutions to reduce the cost 56 Would you Promoted and Using counter Setting a tight arrange of benefit policy for machines controlling system efficiency of the employees solution based on priority? Setting a tight Improve quality Controlling Improve the controlling of meals system to identify power of AEON’s the right negotiation system employees who register but not eating Improve the quality of meals Summary Setting a tight controlling system; Use a counter machines; Improve quality of meals and Improve the power of AEON’s negotiation E Thanks and close: Anything else That is all That’s on Not at all Not at all Yes of course Ok Yes of course Yes, I am pleasure you want to share with me? Can I contact you again whenever more questions arise? Summary All of interviewees are willing to answer the question later 57 APPENDIX 4: QUESTIONNAIRE RESEARCH QUESTIONNAIRE THE FACTORS AFFECT EMPLOYEES QUIT JOB IN AEON CELADON AND CANARY Dear all, This research is conducted to find out the factors, which affect employees quit their job at AEON Vietnam in Celadon Tan Phu, AEON Binh Tan, Canary Binh Duong and AEON Long Bien Please help us to collect data for this research Your all information is confidential Looking forward to getting your contribution Thank you for your supporting! I Personal and job position information: Gender: Job position: How long have you worked in AEON? II Research questions: How long you work in a day? Do you often work overtime? Are you happy with your current job? Do you intend to quit current job in AEON Vietnam to find the new job? Which reasons make you intend quit current job in AEON Vietnam? Arrange the piority reasons make you intend to quit current job in AEON Vietnam (Notice: From to corresponding with increasingly important level) 58 No Items No career opportunities Overload working Stress Low increasing salary rate Loss believe in management way Not recognized for your contribution Job duties boring/not challenge Misconceptions about the work Mismatch between job and person 10 Other reasons Can you make some comments to solve these job problems in AEON Vietnam? 59 APPENDIX 5: SUMMARY OF SURVEY Based on answers are conducted from 10 respondents, who take part in make survey and are cost managers the result as below: I Personal and job position information Gender GENDER Male 40% Female 60% Male Position Female POSITION Controlling gerneral cost 20% Controlling meal cost 80% Controlling meal cost How long have you worked in AEON? Controlling gerneral cost EXPERIENCE YEARS Over years 10% years 20% Under years 70% Under years years Over years 60 Summary + Gender: 60% respondents are female and 40% male + All respondents are responsibility for cost managing in AEON Vietnam + More than half of respondents have only under years work for AEON Vietnam Almost of respondents are managers and have under year of experience II Research questions How long you work in a day? WORKING TIME Under hours 0% hours 30% Over hours 70% Under hours Do you often work overtime? hours Over hours WORK OVERTIME NO 10% YES 90% YES NO 61 Are you happy with your current job? PLEASURE WITH JOB YES 30% NO 70% YES Do you intend to quit current job NO INTEND QUIT JOB in AEON Vietnam to find the new job? NO 30% YES 70% YES Which reasons make you intend + No career opportunities quit current job in AEON + Overload working Vietnam? + Stress NO + Low icreasing salary rate + Loss believe in management way + Not recognized for your contribution + Job duties boring/not challenge + Other reason 62 The reasons make you intend to quit current job in AEON Vietnam No Items Factors 10 No career No career 5 4 5 opportunities opportunities Overload Overload 3 2 4 working working Stress Stress 5 4 4 Low Low 3 2 4 increasing increasing salary rate salary rate Loss believe in Loss believe 1 2 3 1 management in way management Not way recognized for Not 5 5 your recognized for contribution your Job duties contribution boring/not Job duties 1 3 1 2 challenge boring/not Misconception challenge s about the Misconceptio 1 1 1 1 1 work ns about the Mismatch work between job Mismatch 1 1 1 1 1 and person between job Other and person reasons Other 2 3 10 reasons 63 There are four factors which have the highest Summary Mean: No career opportunities (Mean = 4.5); Not recognized for your contribution (Mean = 4.3); Stress (Mean = 4.2) and Overload working (Mean = 3.5) + Increasing salary III Recommandation + Make more opportunities + Recognize contribution + Give more reward Based on information, which was collected from 10 participants, caculating the Mean, Standard Deviation and Coefficient of Variation (CV) of each factors based on the formulas as bellow: Mean ( ̅ ) = ∑ Standard Deviation ( ) = ∑ Coefficient of Variation (CV) = ̅ ̅ In which: i : Sequence number of variables n : The number of attendees x : The value of variables The Mean and the Standard Deviation are two important indexs in anlaysis The Mean shows the average value of a set of numbers, in which the Standard Deviation and Coefficient of Variation are a measure of how spread out number 64 Factors 10 No career 5 4 5 5 3 2 4 Stress 5 4 4 Low increasing 3 2 4 1 2 3 1 5 5 1 3 1 2 1 1 1 1 1 1 1 1 1 1 2 3 opportunities Overload working salary rate Loss believe in management way Not recognized for your contribution Job duties boring/not challenge Misconceptions about the work Mismatch between job and person Other reasons Based on the survey result, apply the formula of calculating Mean, Standard Deviation and Coefficient of Variation (CV), we have the calculating table as below: 65 Factors Mean Standard Coefficient of Variation Deviation No career 4.5 1.74 0.39 Overload working 3.5 1.50 0.43 Stress 4.2 1.68 0.40 Low increasing 2.9 1.37 0.47 1.7 0.96 0.57 4.3 1.69 0.39 1.9 1.04 0.55 0 0 2.4 1.20 0.50 opportunities salary rate Loss believe in management way Not recognized for your contribution Job duties boring/not challenge Misconceptions about the work Mismatch between job and person Other reasons Summary: There are four factors which have the highest Mean: No career opportunities (Mean = 4.5); Not recognized for your contribution (Mean = 4.3); Stress (Mean = 4.2) and Overload working (Mean = 3.5) It shows that there are factors, which affect experienced managers quit job strongly 66 ... Minh City – Year 2017 SUPERVISOR’S REPORT ON THE THESIS SUBMITTED FOR DEGREE OF MASTER of BUSINESS ADMINISTRATION The thesis title: THE POOR EXPERIENCE IN MEAL COST MANAGEMENT IN AEON MALL VIETNAM... are AEON Shopping Center – Tan Phu Celadon in Ho Chi Minh City, AEON Shopping Center – Binh Duong Canary in Binh Duong Province, AEON Mall Binh Tan in Ho Chi Minh City and AEON Mall Long Bien in. .. ECONOMIC HO CHI MINH CITY International School of Business - Ho Thi Nguyen Thien THE POOR EXPERIENCE IN MEAL COST MANAGEMENT IN AEON MALL VIET NAM MASTER OF BUSINESS ADMINISTRATION