Luận văn thạc sĩ tạo ĐỘNG lực CHO NGƯỜI LAO ĐỘNG TẠI CÔNG TY TNHH MTV vật tư ĐƯỜNG sắt đà NẴNG e

Contribution of the thesis The thesis will systemize theories on the work satisfaction, factors influencing to the employee’s satisfaction; analyze the motivation situation in the DRMC;a

INTERNATIONAL EXECUTIVE MASTER OF BUSINESS ADMINISTRATION PROGRAM

THESIS EMPLOYEE MOTIVATION AT DANANG RAILWAY MATERIAL ONE MEMBER COMPANY LIMITED

S e p t e m b e r , 2 0 1 3

Firstly, I would like to express my deeply thanks for all lectures, professorswho have supported, created favorable conditions for me learning, studying,transferring knowledge and sharing experiences during the last time

I would like to thank Dr Dang Ngoc Su for his enthusiast and great support toprovide guidelines for me to complete my thesis

I also would like to give my special thanks for my leaders, colleagues in DRMCwho have created favorable conditions in the data collection to complete my thesis.Althought, I have tried all my best to complete the thesis, there still have manyshortcomings Therefore, I would like to received valuable comments given by therelevant lectures

Danang, Oct 2013

TABLE OF CONTENTS

ACKNOWLEDGEMENT ii

DECLARATION iii

LIST OF ABBREVIATION vii

LIST OF CHARTS viii

LIST OF CHARTS ix

INTRODUCTION 1

CHAPTER 1: MOTVATION THEORIES FOR EMPLOYEES 4

1.1 Roles of motivation for employees 4

1.1.1 Motivation and create motivation for employees 4

1.1.2 Roles of motivation to the productivity of employees 5

1.1.3 Factors influence to the work motivation 6

1.1.3.1 Intrinsic factors 6

1.1.3.2 Extrinsic factors 9

1.1.4 Motivation theories 10

1.1.4.1 Hierachy of needs by Maslow 10

1.1.4.2 E.R.G theory by R.Alderfert 12

1.1.4.3 Need (content) theory continued by David Mc Clelland 13

1.1.4.4 Positive reinforcement by B.F.Skinner 13

1.1.4.5 Expectancy theory by Victor Vroom 14

1.1.4.6 Equity theory by J Stacy Adams 15

1.1.4.7 Two factor theory by F.Herzberg 16

1.1.4.8 Goal theory Edwin Locke 17

1.1.5 Summary of basic factors influence to the motivation work in these

abovementioned theories 18

1.2 Content of motivation work in the enterprise 18

1.2.1 Define needs of the employees 18

1.2.2 Develop and select the way to create motivation 19

1.2.2.1 Build the equitable and appropriate salary system 20

1.2.2.2 Build appropriate reward system 20

1.2.2.3 Build attractive welfare system 21

1.2.2.4 Training and develop human resource to increase adaptability of workers with the development of the working environment 21

1.2.2.5 Create good working environment and conditions 22

1.2.2.6 More concern about the development and growth 23

1.2.2.7 Corporate culture 24

1.2.3 Assess the satisfaction level of employees in the enterprise 24

1.3 Rationale to create motivation for employees in DRMC 25

CHAPTER 2: THE SITUATION OF THE MOTIVATION WORK FOR EMPLOYEES IN DRMC 27

2.1 Overview DRMC 27

2.1.1 Overview 27

2.1.2 Scope of operation 27

2.1.3 Business strategy 29

2.1.4 Organizational structure 30

2.2 General characteristics of the human resource of DRMC 33

2.2.1 Gender structure in the company 33

2.2.2 Labor structure by age in the company 34

2.2.3 Labor structure by education background 34

2.3 Business performance in the DRMC 35

2.4 Motivation works for employees in DRMC 37

2.4.1 Findings from motivation survey in the last time 37

2.4.2 Motivation work situation in the DRMC 40

2.4.2.1 Salary 40

2.4.2.2 Reward and welfare works 45

2.4.2.3 Working environment in DRMC 49

2.4.2.4 Training in the DRMC 51

2.4.2.5 Promotion and development opportunity in the company 56

2.4.3 Overall assessment of the motivation in DRCM 57

CHAPTER 3: SOLUTIONS TO MOTIVATE EMPLOYEES IN DRMC THE PERIOD 2014 TO 2017 60

3.1 Objectives and directions on development of DRMC 60

3.1.1 Development objectives of DRMC in the future 60

3.1.2 The direction for development of DRMC 60

3.2 Viewpoints on creating motivation for employees at DRMC 61

3.3 Solutions to improve the motivation in DRMC 62

3.3.1 Improving method of determining the needs of employees 62

3.3.2 Improving motivation for employees 63

3.3.2.1 Improving the job analysis: 63

3.3.2.2 Improving the annual performance appraisal 65

3.3.3 Improving salary policy 66

3.3.4 Improving the recognition and welfare policy 67

3.3.5 Improving the relationship between leaders and staffs 68

3.3.6 Training and building future team leaders 70

3.3.7 Annual plan and execution for 2014 – 2017 period 71

3.3.8 Total plan evaluation 73

3.4 Recommendation 73

3.4.1 Recommendation for the Labor union: 73

3.4.2 Recommendations for the management team: 73

CONCLUSION 75

REFERENCES 76

LIST OF ABBREVIATION

VNR Viet Nam Railway

DRMC Danang Railway Material One-member Company Limited

LIST OF CHARTS

Page

Table 1.1 two factors theory by F.Herzberg 16

Table 2.1: Employees by gender in the company 33

Table 2.2: Labor structure by age in the company 34

Table 2.3: Revenue by service of the company 36

Table 2.4: business reults of the DRMC in 3 year (2010 -2012) 37

Table 2.5: Assess the satisfaction level by gender and age 39

Table 2.6: List of individual and department for the best performance in 2012 47

Table 2.7: Welfare of DRMC 49

Table 2.8: Training results in DRMC 54

LIST OF CHARTS

Trang

Figure 1.1: Maslow hierarchy of needs 11

Chart 1.1 Victor Groom Model 15

Chart 2.1: DRMC organization chart 30

Chart 2.2: Labor structure by education background from 2010-2012 34

Chart 2.3: Labor structure by education background 35

Chart 2.4: Assess level of complicated work 38

Chart 2.5: findings on the wage satisfaction 45

Chart 2.6: Factors impacts to the work effectiveness 47

Chart 2.7: The satisfaction in the working environment 50

Chart 2.8: Training at the company 55

Chart 2.9: Development opportunities 56

1 Rationale

Danang Railway material one member company limited (abbreviated asDRMC) was established in 1978, is an independent company of the RailwayConstruction Corporation After more than 30 years of development, the DRMC isconsidered as the leading company in providing materials and supplies, machineryand equipment of railway industry

Human resources is a key factor in determining the success or failure of theenterprise Especially in the context of globalization and international economicintegration is going very strong, the competitive environment is increasingly fierceamong enterprises both at home and abroad that requires enterprises to build theirhigh quality workforce, effective performance to promote the strengths of thebusiness to gain competitive advantage in the market

To survive and develop in the free market economy, the enterprise is alwaystowards to the production and business with the high quality and efficiency, and toachieve that goals, the human resource is the core element Follow to thisdetermination, enterprises are looking for the best solutions to have effective usage

of their human resources However, how to arouse the enthusiasm of workers, usingreasonable and effective exploitation of human resources in business is a veryimportant issue Therefore, solution to improve the motivation for employees todedicate their capabilities for the enterprise is essential

In recent years, the company has tried to create motivation for theiremployees However, the motivation for employees still have some shortcomings

On the other hand, motivation is required to adapt to the regular change of the

working environment So, the author has selected the topic for the thesis "Employee motivation at Danang Railway Material One member Company Limited known as DRMC".

2 Purpose and applicability

Systemize motivation theories for employees in enterprises, andorganizations

Analyze and assess the motivation situation for employees in DRMC, findingthe root causes to limit motivation for employees in DRMC

Propose solutions to improve motivation for employees in the DRMC

3 Subject and research scope

+ Research subject: The motivation for employees in the enterprise

+ Research scope:

Scope: Only DRMC is studied

Time frame: The motivation situation for employees in the DRMCimplemented from 2010 to 2012 will be studied Recommendations and solutionsfor improving motivation for employees in the DRMC will be proposed for theupcoming time from 2014 to 2017

4 Research method

4.1 Research method

To follow the research objectives, the qualitative and descriptive analysis will

be used in this research

4.2 Data analysis and collection

+ Data:

Primary data: It will be collected through interviews and questionnaire survey Secondary data: It will be collected from books, referent books and internet …

+ Data process: The collected data will be processed by the Excel and computer

5 Contribution of the thesis

The thesis will systemize theories on the work satisfaction, factors influencing

to the employee’s satisfaction; analyze the motivation situation in the DRMC;analyze factors influencing to the encouragement and satisfaction of employees.The important results of the thesis is to propose solutions to improve employee’ssatisfaction to improve the work performance for employees

6 Thesis structure

Beside the introduction, content, conclusion and reference, the thesis structurewill have three chapters

Chapter 1: Motivation theories for employees in the enterprise.

Chapter 2: Analyze the motivation situation for employees in the DRMC

Chapter 3: Main solutions to improve the motivation for employees in the

DRMC

CHAPTER 1: MOTVATION THEORIES FOR EMPLOYEES

1.1 Roles of motivation for employees

1.1.1 Motivation and create motivation for employees

Any organization would expect their employees to complete tasks with highefficiency to contribute to the successful implementation of the objectives of theorganization However, there are many employees who always workenthusiastically with effective performance, there are also sluggish workers, lack ofinterest in work , neglect of work, or even quit, job performance is low

Many economists have pointed out that the answer to the abovementionedproblem is the work motivation of individual employee There are many differentapproaches to the nature of the labor force

“Motivation is the desire and willingness of individuals to enhance effortstowards to the achievement of organizational goals”

“ The motivation of the employees is the internal factors stimulate efforts inthe normal working conditions enabling the productivity and efficiency”2

Expression of motivation is the willingness of effort, passion to work toachieve the goals of the organization as well as their own

Maier and Lawler (1973) presented the model of work performance is afunction of ability and motivation While, the working ability depends on innateability, knowledge and skills are gained through working experience and training;resources to do the job Motivation is the desire and voluntary of each individual.From these abovementioned studies, it could be understood: "Motivation is theinternal factors stimulate individual efforts to work with the voluntary desire and toachieve their own goals and objectives of the organization "

Work motivation is the process to create motivation of individual employee inworking Therefore, create motivation is understood as the application of policies,solutions, and the appropriate management tools influence to employees to make

 Associate Professor Ph.D Nguyễn Ngọc Quân and Master Nguyễn Văn Điềm ( 2004) HR Curriculum publishers society Labor pages 134.

2 Ph.D Bùi Anh Tuấn ( 2003) Organizational Behavior Curriculum Publisher Statistics pages 89.

their motivation in working thus promoting satisfactory with their work, the desireand effort to work better to contribute to the organization.

Work motivation for employees is the complex process At the managementperspective, it is the manager's impact generates the motivation of individuals.There are two types of impacts:

Firstly, worker is forced through the economical solutions and economiccoercion economy These actions taken place in the regime of private property is themost significant period of capitalism Today, it is not widely applied

Secondly, workers are stimulated through incentives for both matter and spirit

to create motivation to work This second type of impact is now widely applied inmany organizations and businesses

1.1.2 Roles of motivation to the productivity of employees

Motivation is expressed through specific tasks that each employee is currentlyresponsible and with their attitude with the organization This means that there is nogeneral motivation for each employee Each employee may have differentmotivation to work harder Thus, motivation is associated with the job, anorganization and a specific workplace

Work motivation does not entirely depends on the individual personality traits,

it often change depends on the objective factors in working At this time, anemployee may have high motivation to work but the motivation is not alwaysexisted at other point of time

Work dynamics is voluntary and depends on the workers themselves, theywork actively and work harder when they do not feel a pressure or pressure at work.They can achieve the highest productivity when working in a voluntary initiative

Work motivation plays an important role in increasing the productivity ofwhile the other input conditions remain unchanged Motivation as an internalinvisible labor force push labors to worker enthusiastically However, themotivation is the only source to increase labor productivity rather than conditions to

increase productivity because these depend on the qualifications and skills ofemployees, the technology of production lines.

To get motivation for employees, it must find ways to create the motivation.Thus "motivation is the system of policies, procedures and management practicesimpact to employees which is aimed at to get employees motivated to work."

In order to create motivation for employees, it needs to understand the workingpurpose of employees so that motivation and work dynamics are created foremployees

1.1.3 Factors influence to the work motivation

Motivation of employees is not natural appearance which is a combination ofresources and belongs to the employees themselves, living and workingenvironment of employees Thus, the dynamic behavior of the employees in theorganization is affected by many factors and can be divided into two groups asfollows:

1.1.3.1 Intrinsic factors

The job description

Employees will be interested, motivated to work when they are appointed tomatch with their capacity, have the opportunity to use their knowledge and skills inwork, independent in work and receive feedbacks on the results of work, and havebenefits to complete assigned work However, along with long time of working, thejob becames familiar with the work, repeated tasks will create boring and leads toreducing the destructive motivation of employees So, to ensure the work createsexcitement for employees, managers need to pay attention to the analysis and design

of job description that has been specifically designed, challenging, responsibilitiesmust be clearly defined, appropriate working arrangements with competence,excellence of employees so that they can maximize capacity

Technology

The technology knowledge is significant impact to the motivation ofemployees The advanced techniques and modern technology requires employees tohave advanced knowledge to meet the job requirements This promotes employeesstrive to learn, explore advanced skills to be able to survive and development orthey will be eliminated As a result, enterprises should also pay attention to providetrainings for their employees, advised knowledge, skills need to be trained inaccordance with the technical specification and technology of the company.

Working conditions

Working conditions include factors such as equipment and facilities, theorganization and workplace arrangement, the hygiene factors (dust, noise ), thework cooperation have a significant impact on the ability to work, health, workattitude and work performance If the employee is working in good workingconditions such as fully equipped facilities, work is arranged logically organized,modern production methods applied offer higher productivity, reduced the heavywork, labor safety and health protection of workers, the healthy and belief ofcooperation spirit will make employees feel comfortable in working to promotehigher productivity and vice versa Therefore, managers must pay constant attention

to creating favorable working conditions for their workers eager to work

The management and leadership style: In the organization, the leader is theperson directly managing and directing employees so the management style hasgreat influence on the attitude and outcomes of their staffs Currently, leadershipand management style can be divided into three categories Paternalistic(Autocratic)leadership style is autocratic leaders make decisions and get employees to complywithout any question, it is usually created stressful for employees, employees work

as a the machine, there is no work motivation, however, this style promoteefficiency in emergency situations where it needs to have quick decisions, resolute.Democratic management style leaders are interested in attracting employees in thedecision making process, consultation is made to have the final decision, this style

is to create a spirit of cooperation, but sometimes it will be making difficult as well

as delays in decision making if indecisive leader The laissez-faire style, the leaderincreased autonomy for subordinates by allowing subordinates to make decisionsand reduce the cost of intermediate management, however if subordinates have nocapacity and commitment with the organization, they will bring damage to theorganization.

Each leadership style has its advantages and disadvantages so leaders need todetermine the appropriate style to encourage employees to achieve the organizationgoals

Corporate culture

Corporate culture is created from the overall objectives, policy management,human relations, working environment, working style, the material and symbolice.g songs, uniform, forms, norms create identity, values, beliefs, lifestyles andways of action and attitude and behavior of employees Enterprises that have theirown strong corporate culture will help members to close together, mutualunderstanding, independent working, friendly cooperation to achieve goals of theorganization

The human resource management policies: including all aspects fromrecruitment, human resource arrangement, staffing, job appraisal, training anddevelopment of human resources, compensation, health and safety policies have alarge impact on the work motivation The timely and appropriate human resourcemanagement policies is not only help managers having an effective way to achievethe goals of the organization, but also to ensure the rights as well as expectation ofemployees that affect to the motivation of employees If the worker is working in asafe environment, get high payment that is appropriate with their performanceresult, having opportunities for promotion and learning, to be treated fairly, havingopportunities to promote their strengths they will have their commitment with thecompany, try all their best to contribute to the company

Organizational structure

The organizational structure is a system of tasks, relations, report and power tomaintain the operation of the organization The organizational structure plays adecisive role in all activities of the organization A reasonable structure, simple,power and responsibilities of each department and each member is clearly divided,flexible, non-overlapping, in accordance with the requirements of the organizationwill help perform tasks quickly, high effectiveness, and get employees understandtheir position within the organization and from which they will actively andcommitment with their work Conversely, if the structure is not appropriate, moreclues, more overlapping parts will lead to stagnation and inefficiency.

1.1.3.2 Extrinsic factors.

The position and role in society

Employees working in the industry that society interest and appreciation, theywill feel pride, love of work, effort at work In contrast, for other fields that society

is less concern and appreciate, employees may not feel satisfy with the job,employees is easy to be inferiority complex to take the job, they will disincentive towork Thus, to get motivation for employees, managers need to create excitement inthe work for the employees, to have psychological impact to their workers to reallyappreciate and proud of the work that they are currently taking, while providingsolutions to improve the position and image, change the perception of society withthe career

Laws of the State

Especially, labor law is the legal basis to ensure the rights and obligations ofthe parties in the employment relationship The strict legislation enforcement andhigh effect of the law, employees are willing to work hard because their rights areprotected by the law To do this, the State and other agencies have been researchingand perfecting the legal system to be more effectively

The system of social welfare

The social welfare system have a role to ensure and support a part of life foremployees after retirement or due to occupational accidents, occupational diseases,maternity When the social welfare system is growing, the lives of employees will

be increasingly assured When employees have the full of their social insurance,they will feel more secure for their life after retirement, from which they will paymore attention to their work, they will get high work motivation and efficiency

The cultural values and national traditions

In European countries such as Britain, the U.S., the individualism is enhanced,the individual will concern to their interests first and then to their relatives Theyregard the importance of self striving, to assert themselves by their capacity, so theassociation and teamwork spirit is not high While in the East, teamwork is highlyappreciated, cooperation desired, connection, support, and protect each other Thisdifference affects to the spirit and attitude of employees Therefore, it should payattention to aspects of cultural values and national traditions in developing thepolicy of human resources management

1.1.4 Motivation theories

1.1.4.1 Hierachy of needs by Maslow

According to Abraham Maslow, the basic needs of forming the hierarchy ofneeds, the innate need of human being is placed in a series of stages from primitive

to advance 5 ladder of Maslow's needs is important invent as academic foundationwhich is capable of very high practical applications that help managers developingtheir leadership perspective for improving the management method

Figure 1.1: Maslow hierarchy of needs

Physiological needs: It includes basic needs for human can survive like food,

water, clothing, shelter.In working, employees want to receive reasonable salary tocover living activities and secure their lives and their families

Safety needs: is needs to desire to be safety Employees want to have the

stable work for long term, safety working conditions, adequate, sufficient safetyequipment/facilities and care to protect employees

Social needs (belonging, love): employees want to exchange, meet and

establish contact and relationship with others in life and at work At workplace, itcan be met through networking activities, teambuilding activities outside thecompany, lunch, join the football team of the company, travel, vacation…

Self esteem: is the need for having good position in the society, respect from

others or recognize achievement, talent, capacity of individual At the workplace,the symbol of this status can be the needs to working in the large room, fullyequipped, rewarding achievement because they show appreciation and recognitiongiven by the enterprise with the individual contributions

Self actualization: is the highest level by the needs for honesty, beauty,

creative autonomy, desire for the comprehensive development of both physical andintellectual At the workplace, employees want to have challenge job, requirethemselves to effort to achieve the goal, they want to freedom to work

Maslow said that individuals in the organization mainly act on the needs andsatisfying their needs to their satisfaction and encourage their action According tohim, the needs for human develops from low to high, the low level needs aresatisfied, then it is no longer essentially create momentum and higher needs willbecome more powerful and decisive impact to the behavior of the employees So, tomotivate employees, it needs to understand the current level of needs of employees,then, taking measures is aimed at satisfying their needs to make them enthusiasticand work harder, buoyed in working and more committed to with the taskssimultaneously to ensure that the objectives of the organization is met.

1.1.4.2 E.R.G theory by R.Alderfert

E.R.G theory that human action is rooted from needs and pursuing to satisfythree basic need at the same time:

Existence: it includes physical requirement for survival such as foods, water,

clothing, shelter and other basic needs for the body

Relatedness: is the demand for relationships and interactions between

individuals in life and in work such as relationship with family members, relationswith supervisors, subordinates and colleagues at work

Growth: is the need for personal development, is to create to maximize ability.

ERG Theory and Maslow's theory are similar to define hierarchy of needs, andrecognize human needs satisfied by from low to high However, ERG theory hasreduced to three levels and it is more complicated to go to higher level, and a failure

to meet the high needs will create the drop in satisfied lower needs So, whenindividual cannot satisfy for the personal development, he will seek to return to thelower needs and aims at to earn more money So ERG model becomes less rigidthan the hierarchy of needs by Maslow, this means that each individual can flexiblysatisfy their needs depending on their abilities

ERG theory explains why organizations find different ways to know where is

to stop at the hierarchy of needs thereby encouraging their participation in making Actual management has indicated that the involvement of provide

decision-comments make employees feel that they have recognized and motivated them inworking.

1.1.4.3 Need (content) theory continued by David Mc Clelland.

David Mc Clelland states that humans have three basic needs such asachievement, affiliation and power

Achievement is the human’s desire to overcome obstacles to achieve success in

work and in lives

Affiliation is the desire to establish social relationship with others, the need of

mutual relationship, support and help each other

Power is the need to control and influence to the working environment of

others, control and influence to others

According Mc.Clelland persons with high achievement needs are often pursue

to have better resolution, wanting to fulfill individual responsibilities, set high goalsfor them to constantly strive effort, demanding specific feedbacks, immediately,want freedom to work He also said that successful people in society and in thebusiness who have high in achievement, power needs and not too low affiliationneeds Therefore, managers need to know of those who have high achievementneeds, given their important work, freedom in work and enabling them to developtheir capacity and provide feedback on the results of their work in a particular way,adequate and timely so that it can effectively use capacity of these employees inorder to achieve goals

1.1.4.4 Positive reinforcement by B.F.Skinner

Theory of Skinner states that human will tend to repeat behaviors that theyare receiving positive (reward) for behavior that is not rewarded or fined will tendnot to repeat However, the effect of the reinforcement such as reward and finedepends on the interval between the occurrence of the behavior and the time bonus

or penalty, the shorter the period, the effective impact on the behavior will behigher

According to the theory, to motivate for employees, reward should be moregiven such as praise, promotion, money to encourage the achievement, efforts ofemployees that bring interest for the company On the other hand, it should limit theuse of punishment as a rebuke, cut benefits for worker’s faults that have or mayhave ignored, as not to know the error is temporary or not serious enough to require

to use punishment, give them opportunities for overcoming

To be able to use these Punishments to encourage employees to work, theenterprise must perform the following tasks:

Identify specific positive behaviors to guide employees in working at thesame time points out negative behavior that employees should not commit

Build the punishment associated with the behaviors identified above, however

it should be emphasized in the form of reward rather than punishment

To inform and explain employees to understand the good and bad behavior,reward and punishment measures respectively

The need to reward or punish conduct right after behavior taken place as soon

as possible and it must be conducted fairly, openly

1.1.4.5 Expectancy theory by Victor Vroom.

Victor Vroom has researched and formulated the individual motivation as

follow: Motivation = Expectancy x Instrumentality x Achievement

Expectancy or relationship - achievement: is the ability that an employee

aware that a certain effort will lead to the level of achievement

Relationship between achievements - reward: the belief that when the job isdone and achieved a certain performance, employee will be received a rewardcommensurate

The attractiveness of the reward: the level of importance that employees place

on the outcome or the potential rewards that they can achieve in their work Thiscatalyst means that there is appeal of both the target and needs of employees

Vroom expectations theory indicates that an employees would have work hard

if they have a strong belief that a certain of their efforts will bring a certain

achievement, and they would be received the rewards or results as expected Thus inorder to create motivation for workers eager to work, managers must make it veryclear that the relationship between effort and achievement, between achievementand rewards, and rewards both physically and mentally in accordance with theachievements of employees and especially is suitable to the needs, expectation ofthe employees.

Chart 1.1 Victor Groom Model

1.1.4.6 Equity theory by J Stacy Adams

According to Adams J.Stacy , employees in organizations always want to betreated fairly including in and outside working place

The internal equity means that employees expect to the accurate assessment oftheir contributions to the business and receive salary, bonus, incentives and efforts

or contribution that they have spent If employess think that what they are received

is not associated with their efforts that they have made, they will be frustrated , thenthey will work without highest capacity or even they will be able to stop working Ifthey think they get the deserved rewards and incentives they will maintain thecapacity, if they found that the reward and remuneration are higher than what theywant, they will work hard But that will tend to reduce the value of long-termrewards and no incentive effects

External equity is that employees want to be treated fairly as others Thus theytend to make comparation of their benefit with their contribution with others

Individual benefit

Employees will think they are treated fairly when they know the rate for theirbenefit above their contribution is equal with others then they will satisfy with thework, their work will be effective Otherwise, if the rate is not equal they think theyare being treated unfair they will have disgruntled behaviors, reaction to the fairsuch as reduce the work effort, more absense or even resignation

Therefore, to establish and maintain fairness in the organization in order tocreate motivation for employees to work , businesses need to build good evaluationsystem , with the appropriate criteria, accurate and equitable evaluation method,evaluation conducted fairly, and openly which is aimed at to accurately reflect theperformance and contributions of employees At the same time conductingsalaries , bonuses and human resource activities based on the results of theevaluation In addition, it needs to avoid discrimination among employees in theteam for any reason such as gender, age , ethnicity or religion

1.1.4.7 Two factor theory by F.Herzberg

Frederick Herzberg has divided factors influence to the employees motivation

in to two following groups namely: Maintaining factors and Incentives factors.

Table 1.1 two factors theory by F.Herzberg

Maintaining factors (environment) Incentives (Motivation) factors

The extrinsic factors have the effect to maintain the status to maintain goodworking, preventing dissatisfaction at work but do not make them do the job better.Conversely, if it does not address it properly it will create resentment and reaction,employee’s opposition thereby the performance will be reduced.

The incentive factors, if there are good resolved, will create work satisfactionand will motivate employees to work harder, work harder, otherwise if it is not donewell, it will make employees dissatisfied with their work Employees shall work asrequired to achieve their work without excitement, depression, no motivation tostrive to improve of their performance

Therefore, to create job satisfaction in order to provide incentives foremployees, first the manager should pay attention to maintaining factors preventdissatisfaction and create comfortable working conditions for employees Next, toimpact of incentive factors to create motivation for employees to work through theanalysis to enrich the work content, increase challenges, increase liability, empowerfor employees, express recognition of achievements of employees through increasedsalary, reward, promotion and other remuneration

1.1.4.8 Goal theory Edwin Locke

This theory states that intentions to work toward goal is the main source ofwork motivation Through his studies Edwin Locke pointed out that the specificgoals and challenges will lead to better job performance

Thus in order to have motivation of employees, the following steps should betaken:

Develop specific goals that are challenging and measurable as this will helpemployees better understand the expectations of the organization, they willdetermine what needs to be done to achieve goals At the same time, employeeswill work hard with the challenging goals

Next, the manager needs let employees know that the set objectives arereasonable, and achievable To accomplish this it can be explained the goals set outwith employees, attracting them participation in goal setting process, assigning

bonuses for goals achievement, creating favorable working environment to achievethe objective then it will identify suitable targets for employees and givingemployees feel the target set is not merely the goal of the organization that but alsotheir own goals

In addition , managers must regularly provide feedback on the results toimplement objectives of employees as the work has done and the work has notcompleted, why and provide solution to employees can work better to achieveobjectives Besides, the rewards should be commensurate to encourage them towork hard when objectives have been completed

1.1.5 Summary of basic factors influence to the motivation work in these abovementioned theories

Through studying the motivation theories, although there are not alwaysentirely true Each theory has advantages and disadvantages but all of it shows theoverview, comprehensive factors affecting to the motivation of employees but theyhave a number of important factors that have decisive influence to the motivation ofemployees

 Salary or income of employees

 Basic needs of human being

 Job/work description of the employee

 Working environment of the employee

Based on the analysis of these abovementioned theories, the theory of Maslowand J Stacy Adams are selected to be the main theories to assess motivationsituation of the DRMC because the basic of motivation work is to satisfy needsunder the equitable principles

1.2 Content of motivation work in the enterprise

1.2.1 Define needs of the employees

According to Maslow, humans are driven by the 5 group of needs ranked fromthe lowest to the highest but in which the strongest demand at a given time will lead

to human’s action and when one needs to be satisfied, it is no longer to create anymore motivation, then another needs to become stronger and become motivateemployees to action Behavior of the employees is to satisfy themselves to get highpaid, have development opportunities, be respected and recognized So, to motivateworkers, there needs to determine their needs, their expectation are, especially is toidentify the key prioritized needs of employees so that solutions will be developed

in the appropriate way

In the team that each employee has its differences, gender, age, location,qualifications and the characteristics will generate differences in needs andexpectations for the work of each employee For example, the needs of the newlygraduated young employees that the basic salary is high, have the proper work withtheir capacity and high satisfactory while experienced employees have extensiveexperience demands high bonuses, work security, get promotion, responsibility forthe work, good position in the team Thus in order to create an effective motivation,there is a need to determine the needs of the employees, determine the needs of themajority in the company and then to classify needsd by groups such as themanagement needs, workers' needs, the needs of male workers, female workers from that plan is reasonably built to satisfy the urgent needs, an have the needsprioritized

The needs of employees can be determined through the questionnaire surveywith the system of designed questionnaire or through interviews, direct discussionwith the employee Based on the results obtained, the needs of employees should begrouping to design appropriate solutions to satisfy the needs of each target group

1.2.2 Develop and select the way to create motivation

Based on the results of needs assessment, enterprise will develop ways tosatisfy the needs of the employees for creating motivation for employees to worktoward to achieve the goals of the organization

Methods to motivate employees through satisfying the needs of the employee

as follows:

1.2.2.1 Build the equitable and appropriate salary system

The salary is a very important factor that any employee interests it because it is

a tool to help employees to meet their basic needs such as physiological needs asMaslow’s model On the other hand, salary not only demonstrates the value of workbut it also shows the value and position of workers in the family, in society andorganizations

To ensure the salary actually become a tool to motivate the employees, thesystem of the enterprise must ensure the following requirements:

Firstly is to ensure compliance with the regulations of that government It isthe salary of workers is not less than the minimum level of the state, the employeeshall be entitled to have allowances, overtime wages, salaries to work on day offand other benefits under the regulation of the state

Salary is determined on the mutual agreement between the employee and theemployer based work requirement, the level of complexity of work, scope ofresponsibilities and qualifications, skills and experience required

Salaries and wages are paid to be based on the results of the work completed

by employees to deserve with their contribution to ensure fairness For this, it isnecessary to develop effective and reliable assessment system to accurately reflectthe work done by the employees

1.2.2.2 Build appropriate reward system

Reward is also the way to motivate employees Forms rewarded throughbonuses, rewards is not only reflect to satisfy physical needs of workers, but alsostimulate the spirit of the work, to show appreciation, recognition for contributions

of workers Employees are rewarded feel excited about the enterprise and colleaguetherefore they will have theire motivation to strive for the work better

Therefore, the reward system is built to ensure the following requirements:Reward is associated with the performance of employees The assessment, theapproval must be conducted openly, seriously to ensure fairness and whose selected

must be qualified The reward must be the one to have excellent completion ofassigned tasks, have many initiatives to bring many benefits for the company.

The reward should be conducted promptly and on time, time bonus conductedright after employees have been rewarded behavior as soon as possible

Employees must be awarded that their efforts will bring great results for thecompany and they will receive rewards by these results At the same time, formsshould be diversified and satisfied with the needs that they are pursuing The criteriafor bonuses should be specific, clear, reasonable, not too hard leads to depressionfor workers if it is not achieved or too easily leads to psychological disdain, notstriving The award must be reasonable, have a stimulation, not too high or too low

1.2.2.3 Build attractive welfare system

Welfare is the indirect remuneration paid in the form of support for workers.The benefits have great significance in ensuring life for employees as well ascontribute to improving the living standards for both physical and spirit ofemployees, making them secured to work hard, spend more time in work, moreengaged with the organization as resulted in increasing the productivity So, firstenterprises must strictly followed to the mandated welfare policies as regulated bythe state e.g health insurance, social insurance to satisfy the safety needs ofworkers Furthermore, enterprises should research and improve the quality ofwelfare programs to better support lives of workers such as housing programs foremployees or provide low-interest rate or no-interest program for worker At thesame time, these programs must be clearly developed, implemented a fair andequitable for everyone

1.2.2.4 Training and develop human resource to increase adaptability of workers with the development of the working environment

In terms of business environment is changed rapidly, training and humanresource development becomes an important factor for the survival anddevelopment of the organization In addition, employees are trained, capable andhighly qualified will approach quickly to changes in the business environment, they

quickly identify targets and perform the work with greater efficiency Today,competition is no longer competed against capital, resources that is the competitionfor human resources.

So, enterprises need to provide training and retraining to improve knowledgeand skills for workers, develop high quality training program, consistent with thetraining needs and expectation of workers to offset the shortage of knowledge andskills of employees Besides, to provide training opportunities for employees can beconducted through the financial support and arrange flexible working time

1.2.2.5 Create good working environment and conditions

To work for the company, employees are interested in the salary, and otherworking conditions such as working hours, vacation policy, and other welfarepolicy The improvement of working conditions and working environment isindispensable to maintain their long-term commitment with the company

Working conditions in the workplace is a collection of working environmentelements (hygiene factors, psychological, psychosocial and aesthetic) that affect tofunctional state of the human body, the working ability, work attitude, health, laborrecovery and current performance as well as for the long term

Working instrument, machinery and equipment for production, safetyfacilities, climate conditions, conditions of working time, working regulations havebig influence on the mentality of employees, and their productivity Managersshould provide these conditions in working for employees to create the motivation

Working conditions are important factors affecting the level of attrition andthe mentality of workers in the production line of the enterprise The level ofattrition and the mentality of workers depends on two main factors that is the nature

of work and the status of the hygiene and environment The nature of the workdepends on the specific job characteristics or industry Status and environmentalsanitation includes elements of working conditions: including a collection of factors

in the physical environment of the job such as temperature, lighting, and safetyconditions

1.2.2.6 More concern about the development and growth

Promotion is arranging employees to work in a new position, prestige andhigher responsibility, working conditions are better and have more opportunities tochallenge, develop and have higher salaries The purpose of promotion is arrangedworkers into vacant positions that leaders assess that positions have higher value inorder to meet business development goals, and also meet the development needs ofindividuals, there are two types of promotion:

Horizontal promotion: it is to move employees from one position to otherdepartments which has higher rank or equivalent position

Vertical promotion: it is to move workers from the current position to a higherposition in the same department

This is the positive application of the second factor as developed by Herzberg.Promotion is the advancement, progress of work, expressed in the promotion of theorganization by a higher current titles

Promotion in the Maslow theory is respected and recognition Besides, othervalue of mental stimulation, building firm position, rights, the promotion also bringseconomic benefits such as increased salaries and allowances for the position Thepromotion not only bring true value to honor, recognize employee contributions butalso bring economic benefits, establishing a power, certain positions

Know development needs of workers, the company needs to develop theladder, the next step for employees to strive for their development The companyneeds to plan their talent development, building expertise and soft skills Creatingopportunities for development express concern of their leader They will try toachieve higher standards for their promotion

Based on the current number of employees, technical qualification, thecompany should have training plans which have specific expertise and skillsdeveloped:

Achieving a higher position in the group

It is acknowledged and respected by everyone

Get promotion and have higher salary.

1.2.2.7 Corporate culture

In Vietnamese dictionary "culture is the overall value of physical material and spiritual created by human being in the development stages." There are many different concepts talking about corporate culture Each company has different definition of corporate culture However, all definitions have common traits:

“Corporate culture is the total value developed during the survival and development of enterprises, becoming the value, concepts and custom, tradition associated with the business activities; dominant emotions, thoughts and behavios

of everyone in the enterprise to make the difference between the enterprise and is regarded as traditional of each enterprise”.3

In a business culture defined by the policy, working procedure, behavior andlanguage to communicate with colleagues, partners and customers, the leadershipstyle of business Corporate culture is expressed in many different levels, firstexpressed in everyday works such as communication between departments, thediscussion and the exchange of work, the administrative procedures Next is thespiritual value in determining the work to be done, right or wrong behavior whichcan bring benefit or damage for the enterprise Thus, corporate culture affects to thespirit and motivation of employees

1.2.3 Assess the satisfaction level of employees in the enterprise

After conducting motivation for employees through applying policies andsolutions to meet theire needs, it is needed to measure and assess the level ofsatisfaction of employees from which the appropriate corrections must be takenpromptly to maintain and increase the motivation of employees

Motivation of employees can be indirectly measured through indicators ofproductivity, revenue, profits, resignation rate, termination, rotation Themotivated workers are always enthusiastic, striving, committed to work with thecompany, always searching to improve and enhance their performance thus

3 Đình Phúc-Khánh Biên 2007, HRM, Publishers Đà nẵng, papes 107

contributing to increase revenue, increase profits, reduce costs, reduce theresignation and work transfer.

However, there are many cases where revenues and profits can decrease bysome reasons Motivation may also one of those causes To find and assess whethermotivation is a driving force of the causes affecting the business results of thecompany or not, it needs to conduct the questionnaire survey of the worksatisfaction of employees which can be conducted by questionnaire designed tocollect the assessment of the employee satisfaction with aspects of the work they aredoing

From the processing and analysis of the results obtained from the questionnairewill measure whether motivation are not effectively applied, it can satisfy the needs

in the work that employees are pursuing and satisfying to what extent thatadjustments can be made for more efficient

After measuring the level of employees satisfaction and provide correctiveaction, it needs to go back to further identify the needs of the employees because theprevious needs of employees has been met, the new and higher needs appeared willaffect to the behavior of employees The above process carried is continuouslyrepeated to ensure the accurate needs identified and provide effective motivation

1.3 Rationale to create motivation for employees in DRMC

Through theoretical study as well as practice of company has showed that themotivation is one of the factors that have a significant impact on the efficiency ofemployees as well as the completion of organizational goals Motivation will firstdirectly impacts on the spirit, attitude and work performance of employees, therebyindirectly affecting to the business performance as well as the success of thecompany

Motivated employees are realized the work that they are doing, commitmentwith the work, enthusiastics, love of the work, and regarded the completion of theorganization goals as a step on the way achieve their goals

Employees will have high satisfaction with the work being done, they enjoythe work, stick with the job, long commitment with the company They willconstantly striving efforts to improve their knowledge and skill, explore newmethods, ways to work effectively, improve and effective use working time

Motivation will bring tangible and intangible benefits for the company,improve business efficiency and profitability through an increase the performance

of employees, improve efficiency work of employees, improve productivity, reduceemployee’s turnover costs, reduce production costs

It is clearly stated the rationale to have work motivation for the employees inthe business as many benefits that motivation brings for employees as well as theorganization

Summary of Chapter 1

We can have better understand the motivation to improve the businessperformance in the company through theory Motivating employees is one of theimportant responsibilities of business leaders However, to motivate employees,leaders need to understand workers Furthermore, leaders need to take the time tolearn what is important to each employee so that there are different motivation fordifferent individuals

To motivate employees, leaders can take physical and mental solutions.Building leadership style and organizational culture is the stimulus solutions foremployees The flexible salary and benefits are exciting to motivate employees

CHAPTER 2: THE SITUATION OF THE MOTIVATION WORK FOR

EMPLOYEES IN DRMC 2.1 Overview DRMC

2.1.1 Overview

The company was established on 1st July 1977 with the original nameRailway material company II The main task of the company is to deal with thematerial supply, spare parts of rolling stock, iron and steel The company transferredinto Joint stock company namely Danang Railway Material Joint Stock Companyfrom 1st July 2005 To June 2009, the company became Danang Railway MaterialOne member Company (DRMC)

DaNang Railway Material One-member Company Limited (known as DRMC)

is the state own company which have full legal, independent accounting system,independent operation as stipulated by the law

Head office: 61 Nguyen Van Cu Street–Lien Chieu District – Danang city

Service production (KD3) in 27 year since 1986 till now

Especially, the company do business for materials used in the railway sectorand this is the main task of the company In the business of import and export goodsand supplies, spare parts, accessories, locomotives and carriages for building newrolling stock industry is a key principal of the company It IS accounted for from65% and 75% of total annual revenue of the company The company has made several imported shipments

Through the import and export activities are imported supplies and equipmentfunction for railways and other industries as needed, organizing the flow of goodsfrom abroad to the the domestic consumption, contributing to job creation,accumulation for the state budget The company have the following tasks.

Export/import materials and equipment used for the industrial production,project construction and railway transport

Export/import consignment for other companies in and outside the industry.Trading petrol, oil retail, warehouse, workshop and office lease

Production and fabrication, supply materials, equipment and spare part usedrailway such as sleepers and woods used for railway

With these abovementioned duties and responsibilities, the DRMC havemanaged and used the effective capital funded by the Railway ConstructionCorporation, exploit and create capital in alternative ways, reasonable to ensure theeffective performance

With these above mention function and duties, the DRMC have the following responsibilities:

Export/import with foreign countries

Have rights to get loan from Vietnamese and foreign banks, mobilize capitalfrom any business sectors in and outside the country which is aimed at to serve forthe business and trading of the company and also to ensure the payment allaccounts, to follow the foreign exchange and currency regulation of the state

Have right to sign contracts with foreign economic as stipulated by regulations

of the State and International Law, to do joint ventures with foreign, cooperationwith foreign company under the Investment laws of the Socialist Republic ofVietnam

Have rights to participate in trade fairs, exhibition, introduce the new products

of the company in the industry in and outside the country

Have rights to open export/import branches in and outside the country.

2.1.3 Business strategy

DRMC defines its strategic direction are maintaining relationships withexisting clients and reputation of the Company to hold the number one in the marketshare in the railway sector in Vietnam in providing services in equipment, supplies,spare parts for upcoming years

Promote the development of human resources and science and technologymajors, strengthen cooperation with foreign partners, to improve thecompetitiveness of the company

To satisfy all the demands for services supplied materials and equipment withhigh quality, reasonable price compared with other competitors

Overall objectives

 Expand the customer relationship inorder to increase the maket shareand revenue, profit for the company

 Constantly improve service and product maitainance

 Traing, develop technical expertise for staff to scope with theintegration trend, modern development technique

 Have high effective business result, achieve all revenue and profittargets

2.1.4 Organizational structure

Chart 2.1: DRMC organization chart

( Source administrative department of DRMC )The organizational structure of the company is structured according to thefunctions that the board of Directors manage all activities of the Company Alldepartments perform their duties as assigned by the Director authorisation

The company director is the legal representatives under the law that has thehighest authority in the company is responsible one under the law The director isthe top and responsible for the operation organization and production results of theCompany The director also use, maintain and develop capital, assets, infrastructure

as assigned by the state

Besides, the director also has authority to develop business strategy,responsible for the annual and long-term plans, joint venture plans, organization andmanagement, planning and training of company’s employees, submitted forapproval, appoint, dismiss, reward and discipline employees; determine thetechnical and economic consumption, salary and cost of products, goods, services,subject to inspection and control by the relevant state agencies

Chairman also General Director

Security

guard and

workman

Petrol /oil shop

Concrete spleeper workshop

Administrative

department

Export/

import planning department

Finance and account department

Hoa Hong preschool

The deputy Director is responsible for directing and executive work asassigned and authorized by the Director, to be the person in charge when thedirector is absent, is responsible under the law and the director on the process andresults of the work assigned.

The administrative department: 05 staffs

Assist the Director in the management of the human organization, provideadvice in company operation, responsible for the staff organization, humanresource, wages, training and human resource management and other policies foremployees as regulated as well the protection of workers

Finance and accountant department: 04 staffs

Support the director to properly implement in accordance to the accountingsystem as regulated, report economic news in the Company, budgeting andimplement financial plans and financial statements

Export/Import planning department: 07 staffs

Study and direct to the development of the business plan for the company,responsible for the statistical work of the Company in term of turnover (sale in/out),inventory, and responsible to do consignment of import and export for materials,supplies and equipment, provide legal consultant and business projects

Petrol/oil retail shop: 09 staffs

Responsible for sale petrol, oil, provide advice for director on sale oil, petrol

to have reasonable business result for the company

Hoa Hồng (Rose) preschool: 14 staffs

Responsible to provide advice for the director on the preschool education,provide solutions to do business in the preschool education sector

Concrete sleeper production workshop: 18 staffs

Responsible for management and executive in producing sleepers and concrete

to provide rail projects and railway

Workman and security guard: 06 staffs

Responsible for protecting warehouse, workshop, internal goods transport andmovement

Comments on the advantages and disadvantages for the organization structure of DRMC.

In the organizational structure of the company, the role each position is placed

to horizontal function in order to achieve functional and common goals of theCompany All department is responsible for reporting directly to the director who isresponsible for coordinating the activities of the company and is also responsible forthe final results of business operation

This structure will limit the vision of individuals and departments,departments only know their specific expertise without understanding activities ofother departments in the company There is no close collaboration and coordinationbetween departments

Comments

The organizational structure of the company is built on the functional model and

is commonly used in other companies The author do not comment on the