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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, i ACKNOWLEDGEMENT Firstly, I would like to express my deeply thanks for all lectures, professors who 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 to provide guidelines for me to complete my thesis I also would like to give my special thanks for my leaders, colleagues in DRMC who 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 many shortcomings Therefore, I would like to received valuable comments given by the relevant lectures Danang, Oct 2013 ii TABLE OF CONTENTS ACKNOWLEDGEMENT .ii DECLARATION iii LIST OF ABBREVIATION .vii LIST OF CHARTS viii LIST OF CHARTS ix INTRODUCTION CHAPTER 1: MOTVATION THEORIES FOR EMPLOYEES 1.1 Roles of motivation for employees .4 1.1.1 Motivation and create motivation for employees 1.1.2 Roles of motivation to the productivity of employees 1.1.3 Factors influence to the work motivation .6 1.1.3.1 Intrinsic factors 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 iii 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 iv 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 v LIST OF ABBREVIATION Abbreviation VNR DRMC In full word Viet Nam Railway Danang Railway Material One-member Company Limited vi 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 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 vii 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 viii INTRODUCTION Rationale Danang Railway material one member company limited (abbreviated as DRMC) was established in 1978, is an independent company of the Railway Construction Corporation After more than 30 years of development, the DRMC is considered as the leading company in providing materials and supplies, machinery and equipment of railway industry Human resources is a key factor in determining the success or failure of the enterprise Especially in the context of globalization and international economic integration is going very strong, the competitive environment is increasingly fierce among enterprises both at home and abroad that requires enterprises to build their high quality workforce, effective performance to promote the strengths of the business to gain competitive advantage in the market To survive and develop in the free market economy, the enterprise is always towards to the production and business with the high quality and efficiency, and to achieve that goals, the human resource is the core element Follow to this determination, enterprises are looking for the best solutions to have effective usage of their human resources However, how to arouse the enthusiasm of workers, using reasonable and effective exploitation of human resources in business is a very important issue Therefore, solution to improve the motivation for employees to dedicate their capabilities for the enterprise is essential In recent years, the company has tried to create motivation for their employees 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" Research question Do employees in the DRMC currently have their real motivation in performing their works or not? If yes, what level they have? In reality, the company leaders have their right perception to the content and important of the motivation and for what level? What actions and methods are being taken by the company leaders to improve motivation for employees? Are they suitable with employees? What are current shortcomings in creating motivation for employees in the company as well as the causes of these shortcomings? What are the root causes? What are essential solutions for improving motivation to get higher results in the upcoming time? Purpose and applicability Systemize motivation theories for employees in enterprises, and organizations Analyze and assess the motivation situation for employees in DRMC, finding the root causes to limit motivation for employees in DRMC Propose solutions to improve motivation for employees in the DRMC 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 DRMC implemented from 2010 to 2012 will be studied Recommendations and solutions for improving motivation for employees in the DRMC will be proposed for the upcoming time from 2014 to 2017 annual training plan (2 2014 Head times per year) Develop Hương development talents Dec 2014- 120 program Dec 2016 Mưu/Director, Hoa/Admin Head for next generation (once a year, last in years) Annual performance On appraisal Adjust the reward & progress current Mar – Apr fund raising Setting up progress the Mar – May communication and 2014 Hoa Function Heads Hạnh/Acco Hội/F&A untant Ngọc Function Heads Hoa/Admin Head & regulations behavior and Function Heads in the company Evaluate positive On Ngọc Hương Hương Hoa/Admin Head and progress opportunities Core values and internal Jan – Mar code of conduct setting Annual Hương recognition 2014 system Annual social support On relationship Ngọc evaluation 2014 & on Dec 2014- 20 Dec Hương Dec 2017 Function Heads Hoa/Admin Head & Function Heads Total budget estimation 328,5 3.3.8 Total plan evaluation The evaluation of the effectiveness of the work done to improve the labor force in DRMC is expressed through the qualitative and quantitative indicators and targets relating to policies for employees to motivate employees 72 To evaluate the effect of motivating employees at company, the Administrative department to coordinate to other departments to establish tracking systems accurately measure the volume change positive, negative going to work at the company brightly as a basis to assess the effects of work motivation So that changes to suit the current situation of the company The work has been assigned specific tasks in Section 3.3.7 and the coordination of other departments within the company to monitor and respond to personal information relating to the supervision of the implementation of the plan proposed According to the plan on a quarterly basis, the full implementation needs assessment meeting to find out lessons for the purpose of performing the work to be better The work was done and not, the difficulties and problems which have solutions to enhance the motivation for employees in the company 3.4 Recommendation 3.4.1 Recommendation for the Labor union: DRMC has its own Trade union organization, but the role to the employees has no great significance and impact, the trade union is not yet representative for the employees Especially in motivation, the Trade unions that barely involved in, therefore, the author propose from now on the Trade union of the company should pay more attention to employees with positive feedback for the salary system to help company step by step completing the system 3.4.2 Recommendations for the management team: Even the company was very keen in re-arrange the management team more suitable, in reality, it is still bulky and needs to be reduced, labor layout more appropriate for the salary increase leading to workers' wages will increase Chapter conclusion In Chapter the author mainly focuses on specific solutions to solve some major problems need to be handled with the goal to motivate the employees to work in the long term with company The solution should be given to the implementation of the most effective, while ensuring retain qualified employees, has attracted many new 73 employees Implementation of the methods above, the company will have a qualified labors, engrossed in work and loyalty to the company Employee who meets the full benefits from the above solutions will bring them and grow the company, as well as confidence in the development their career with the company in the future, it will bring passion, enthusiasm for the long-term commitment Current limitations The characteristics of business of the company is producing and selling of specialized materials used in the railway industry and the business services than other industries The assessment shown the limits and gaps on levels of workload been done, the effectiveness was not match to their finished works cause discontent for employees CONCLUSION Motivating employees is a problem and is becoming an important role in human resource management policies at every business Motivation will help to perform better results, encourage employee eager to work, striving to improve their studying 74 then to improve outcomes, contribute to improving the production efficiency of the company business On the other hand, if the policy of the company motivate and satisfy the needs of the employees will make them willing to work hard, loyal to the company In Chapter 1, the thesis has outlined, codified the basic scientific reasons about staff motivations; theories of motivation, factors affecting labor force, a number of studies on motivating experience of a number of businesses in order to draw lessons applicable In Chapter 2, Thesis has conducted research and analysis of the situation to motivate employees in DRMC has pointed out the limits and find the cause of paid work, unpaid, rewards, benefits, training, job analysis, job performance evaluation that will effect motivation over employees working at DRMC On the limitations and reasons have been pointed out in Chapter 2, the author has given out the points on motivating employees and proposed solutions in Chapter in order to improve the motivation for employees Thus, the thesis has applied the theory of basic science into practical motivate employees in the company and make recommendations However, due to limited time and scope of the study, the paper should inevitable imperfections and has shortcomings need to be studied for further perfection I look forward to the comments, inputs of the teachers, scientists and colleagues to complete dissertations with better quality 75 REFERENCES Vietnamese Associate professor Trần Xuân Cầu & Associate PhD Mai Quốc Chánh (2008), Economic human resource training curriculum, National economic publish house The Harvard business review (2006), attracting and talent remuneration policy, Ho Chi Minh publish house Hoàng Cương (2008), motivation for good performance of employees, http://www.doanhnhan360.com Trần Kim Dung (2000), human resources management, National university of Hồ Chí Minh publish house Trần Trí Dũng (2008), employees motivation: theory to practical, http://www.doanhnhan360.com Associate professor Trần Thị Hạnh –Associate PhD Đặng Thành Hưng – Đặng Mạnh Hổ (1995), human resource management, political publish house Vương Minh Kiệt (2005), what is to keep employees, Labor and social publish house Nguyễn Hữu Lâm, organizational behavior, statistical publish house Hà Nguyễn ( 2008), improve the situation of demotivated employees, http://www.doanhnhan360.com 10 Saigon economic review (2007), solutions to motivate employees, http://www.doanhnhan360.com 11 PhD Bùi Anh Tuấn (2002), organizational behavior, National Economic University 12 Business statement of DRMC (2010, 2011, 2012) 13 DRMC, the company profile 14 The decision 1436/QĐ-TTg of the Prime Minister for DRMC railways development to 2030 76 English 15 Wright, P.C., Mondy, R.W., Noe, R.M (1996), Human resource management, Prentice Hall Canada, Ontario 16 Griffin, M., Moorhead, G (2001), Organizational behavior: Managing people in organizations, Houghton Mifflin company, sixth edition, New York 17 Jane R Miskell Burr Ridge, Motivation at Work, Mirror Press 18 Peter Boxall, Purcell John and Wright Patrick (2007), The Oxford handbook of Human Resource Management, Oxford University Press 19 Michael Armstrong (2009), the Handbook’s of Human Resource Management Practice 11th Edition, Kogan Page 77 ANNEX QUESTIONAIRE TO ASSESS EMPLOYEE’S SATISFACTION To whom it may concern Xin chào Anh chị! My name is Bùi Văn Cừ, I am currently preparing the thesis namely “improve motivation for employees in the DRMC” The purpose of this survey is to collect data and information to assess the motivation situation of employees, analyze them to find the root causes and have solutions to improve working motivation for employees contributing to ensure that the company will have stable and effective operation Therefore, it would be appreciated if you can spend your time to answer the following questionaire Thank you for your support and enthusiam I Personal information Your age: below 35 years old 35-45 years old over 45 years old Department: - Working Title:………………………………………………………… - epartment:………………………………………………………………… - ualification:…………………………… ………………………… How long have you been working for the company? 1-3 years 3-5 years 5-10 years over 10 years II Questionaire In your opinion, how complicated of your work are? □ Very complicated □ □ Suitable with my qualification □ Not suitable with my qualification □ Very suitable with my qualification 78 Complicated In your opinion, is the salary system equity? □ Very equity □ Equity □ Not equity □ Do not equity How you rate the following factors that influences to your working performance? (please make a tick where appropriate) Item List of factors Most Impor Not import tant import ant ant Salary Salary and welfare Current relations between employees and their supervisor Working environment and conditions Job is suitable with the qualification Training Promotion Pressure given by the supervisor How you assess the salary problem in your working department? (Please make a tick where appropriate) It Description Very em satisfact ctory ory Satisfa So so Less Not satisfa satisfa ctory ctory Reasonable and equitable salary policy Salary is paid with the job appropriately The bonus is paid appropriately Reasonable welfare policy Build reasonable salary payment system Are you happy with the working environment where you are currently working? (Please make a tick where appropriate) Ite m Content Very Happy So so Less happy Team building activities and other 79 happy Not happy social competitions are well implemented Have cooperation and sharing in working Leaders care about employee’s concern and expectation Are you happy with the working conditions where you are currently working? (Please make a tick where appropriate) Item Content Very Happy happy So Less so happy Not happy Clean and cool working place Good infrastructure, equipment provided Flexible working time What you think about the training in your department? (Please make a tick where appropriate) Item Content Very Happy happy Have opportunity to be trained and improved techniques/skills The training program is met the So Less so happy Not happy working requirements Diversified training program High effective training program How you assess about the working promotion where you are currently working? (Please make a tick where appropriate) Item Content Very happy Have opportunity to get higher position Equitable promotion system Happy So Less Not so happy happy 9: What should company to encourage staff working better? ……………………………………………………………………………… 80 ……………………………………………………………………………… ……………………………………………………………………………… ……………………………………………………………………………… ……………………………………………………………………………… 10: What are your specific recommendations to make you working better? ……………………………………………………………………………… ……………………………………………………………………………… ……………………………………………………………………………… Thank you for your opinion and contribution SURVEY RESULTS In your opinion, how complicated of your work are? 81 The complicated work by gender and age Satisfaction with the work Indicato r Very complicated complicated Totally Suitable Not suitable unsuitable with with Total with the qualification qualification qualification By gender Male Female 0% 0% 24,14% 14,29% 19 65,52% 16 76,19% 10,34% 9,52% 0% 0% 29 100% 21 100% By age Under 30 From 35 - 40 Above 45 0% 0% 0% 33,34% 13,79% 0% 44,44% 24 82,76% 100% In your opinion, is the salary system equity? 82 22,22% 3,45% 0% 18 0% 100% 29 0% 100% 0% 100% How you rate the following factors that influences to your working performance? (please make a tick where appropriate) How you assess the salary problem in your working department? (Please make a tick where appropriate) Are you happy with the working environment where you are currently working? (Please make a tick where appropriate) 83 Are you happy with the working conditions where you are currently working? (Please make a tick where appropriate) What you think about the training in your department? (Please make a tick where appropriate) 84 How you assess about the working promotion where you are currently working? (Please make a tick where appropriate) 85 ... Employees are rewarded feel excited about the enterprise and colleague therefore they will have theire motivation to strive for the work better Therefore, the reward system is built to ensure... certain effort will lead to the level of achievement Relationship between achievements - reward: the belief that when the job is done and achieved a certain performance, employee will be received... been met, the new and higher needs appeared will affect to the behavior of employees The above process carried is continuously repeated to ensure the accurate needs identified and provide effective