Effects of Organizational Culture on Employees’ Job Satisfaction at LG Display Vietnam = Ảnh hưởng của văn hóa doanh nghiệp lên sự hài lòng của cán bộ nhân viên trong Công ty TNHH LG Display Việt Nam

ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH - ĐẶNG THỊ HỒNG EFFECTS OF ORGANIZATIONAL CULTURE ON EMPLOYEES’ JOB SATISFACTION AT LG DISPLAY VIETNAM ẢNH HƯỞNG CỦA VĂN HÓA DOANH NGHIỆP LÊN SỰ HÀI LÕNG CỦA CÁN BỘ NHÂN VIÊN TRONG CÔNG TY TNHH LG DISPLAY VIỆT NAM LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH HÀ NỘI - 2019 ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH - ĐẶNG THỊ HỒNG EFFECTS OF ORGANIZATIONAL CULTURE ON EMPLOYEES’ JOB SATISFACTION AT LG DISPLAY VIETNAM ẢNH HƯỞNG CỦA VĂN HÓA DOANH NGHIỆP LÊN SỰ HÀI LÕNG CỦA CÁN BỘ NHÂN VIÊN TRONG CÔNG TY TNHH LG DISPLAY VIỆT NAM Chuyên ngành: Quản trị kinh doanh Mã số: 60 34 01 02 LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH NGƯỜI HƯỚNG DẪN KHOA HỌC: PGS.TS NGUYỄN NGỌC THẮNG HÀ NỘI - 2019 DECLARATION The author confirms that the research outcomes in the thesis is the result of the author‟s independent work during study and research period and it is not yet published in other‟s research and article The other‟s research results and documentation (extraction, table, figure, formula and other documents) used in the thesis are cited properly and the permission (if required) is given The author is responsible in front of the Thesis Assessment Committee, Hanoi School of Business and Management, and the laws for above-mentioned declaration i ACKNOWLEDGEMENT Firstly, I would like to acknowledge my advisor, Associate Professor Doctor Nguyen Ngoc Thang for his wealthy advices He has guided and promptly given me a lot of instructions and comments in order to help me moving forward with the right direction to the completion of my final research Secondly, I would like to express my sincere thank to Associate Professor Doctor Nguyen Ngoc Thang for his support since the beginning of my research that was selecting the very interesting research topics, then going through research outline, until the end of this research From this research, I can have a deep understanding of business administration in general and innovative business model of a business firm in particular I also would like to reserve special thank to my dear husband who spent lots of his time supporting to analyze data and complete the thesis as planned Last but not least, I would like to send my deep thank all LG Display Vietnam‟s employees, especially the 966 participants of the research They have assisted me to fulfill this research successfully in terms of survey questionnaires, the research aims and scope They did spend lots of time on my questionnaires; so that I could collect valuable answers serving for the analysis of data before the thesis could be completed well Because of the time limitation, I cannot avoid some mistakes in the research I look forward to receiving further comments from lectures and colleagues so as to have more objective and fruitful research results/ ii TABLE OF CONTENTS DECLARATION i ACKNOWLEDGEMENT ii LIST OF TABLES v LIST OF FIGURE vii CHAPTER 1: INTRODUCTION 1.1 Rationale 1.2 Objectives of the research 1.3 Subjects and the Research Scope 1.4 Research questions 1.5 Structure of the research CHAPTER 2: LITERATURE REVIEW 2.1 Organizational Culture 2.2 Job Satisfaction 10 2.3 Current Situation of LG Display Vietnam 12 2.3.1 Establishment and History of Development 12 2.3.2 Building the Organizational Culture 13 2.3.3 The Management‟s Point of View and Purposes of Finding Effects of Organizational Culture on Employees‟ Job Satisfaction 14 CHAPTER 3: METHODOLOGY 16 3.1 Sample 16 3.2 Instrumentation 16 3.3 Procedures 19 3.4 Data Collection 22 3.5 Data Analysis 23 3.5.1 Overall 23 3.5.2 Analysis of the Survey Results 24 3.5.3 Analysis of the Internal Documents 25 iii CHAPTER 4: RESULTS AND DISCUSSIONS 26 4.1 Results 27 4.1.1 Results Achieved from Excel Analysis 27 4.1.2 Results Achieved from SPSS Analysis 37 4.2 Discussions 66 CHAPTER 5: CONCLUSIONS, LIMITATIONS AND RECOMMENDATIONS 68 5.1 Conclusions 68 5.2 Limitations 68 5.3 Recommendations 69 5.3.1 Suggestions for Future Studies 69 5.3.2 Suggestions for the Management of LG Display Vietnam 70 REFERENCES 74 APPENDIX A: INFORMED CONSENT TO PARTICIPATE 79 APPENDIX B: EMPLOYEE DEMOGRAPHIC SURVEY 80 APPENDIX C: SURVEY QUESTIONS ON JOB SATISFACTION 82 APPENDIX D: SURVEY QUESTIONS ON ORGANIZATIONAL CULTURE 83 iv LIST OF TABLES Table 1: Job satisfaction survey - Internal consistency reliability coefficient 18 Table 2: Tables showing structure of respondents and distributions of questionnaires 20 Table 3: Survey results received (Source: Primary data) 21 Table 4: Successful Ratio of Respondents‟ Answers 22 Table 5: Marital status of respondents 27 Table 6: Age group of respondents 28 Table 7: Educational level of respondents 29 Table 8: Gender of respondents 29 Table 9: Jobs of respondents 31 Table 10: Service duration of respondents 31 Table 11: Living areas of respondents 32 Table 12: Mean score of organizational culture and job satisfaction of respondents 37 Table 13: Correlation between the company‟s organizational culture and employees‟ job satisfaction 38 Table 14: Details of correlation between the company‟s organizational culture and employees‟ job satisfaction 39 Table 15: Regression between organization culture factors and the employees‟ job satisfaction 41 Table 16: Detailed regression between organizational culture factors and job satisfaction factors 45 Table 17: Groups of sex and job satisfaction 47 Table 18: Groups of sex and organizational culture 49 Table 19: Tables showing significant differences among the means of independent groups of job grade to the employee‟s job satisfaction 53 Table 20: Tables showing significant differences among the means of independent groups of employees‟ education to their job satisfaction 55 v Table 21: Tables showing significant differences among the means of independent groups of employees‟ living areas to their job satisfaction 56 Table 22: Tables showing significant differences among the means of independent groups of employees‟ service duration to their job satisfaction 58 Table 23: Tables showing significant differences among the means of independent groups of employees‟ job grades to the organizational culture 60 Table 24: Tables showing significant differences among the means of independent groups of employees‟ educational levels to the organizational culture 61 Table 25: Tables showing significant differences among the means of independent groups of employees‟ marital status to the organizational culture 63 Table 26: Tables showing significant differences among the means of independent groups of employees‟ service duration to the organizational culture 63 Table 27: Tables showing significant differences among the means of independent groups of employees‟ living areas to the organizational culture 65 vi LIST OF FIGURE Figure 1: A framework to analyze the relationship between Organizational culture and Job satisfaction 12 Figure 2: Job satisfaction among total respondents at LG Display Vietnam 33 Figure 3: Analysis of organizational culture in LG Display Vietnam 35 vii CHAPTER 1: INTRODUCTION 1.1 Rationale Located in Hai Phong Province, Vietnam, LG Display Vietnam was officially established in April 2016 with total investment 1.5 billion USD It is one branch of LG, a famous Korean group specializing in manufacturing electronic products such as TV, OLED, POLED module, washing machines, vacuum, refrigerator, etc With the purpose of becoming number one global display manufacturing company in electronics industry, the company will reach 20.000 employees including 200 Managers, 1.800 Engineers, 200 Unit leaders, 1.900 Technicians, 500 Korean Interpreters and about 17.000 Operators (Internal HR Plan 2017-2020) With this business strategy, work quality, employee commitment and recruitment efficiency (mass numbers) are always the matters of concern of the director board As a new company, LG Display Vietnam now focuses on building up a strong organizational culture in order to help motivate its employees to work and create the most professional working environment with high job satisfaction for the employees in the company Despite such efforts, turnover rates of the company are a little high, 3.5% among line worker taking shift work and 2.5% among office workers taking admin shift (turnover rates of other companies in the same industry are 3% and 2% relatively) Consequently, high turnover rates have led to negative effects on LG Display as follows: - Shortage of key positions such as Managers, Assistant Manager, Engineers This causes over-workload for current manpower in the same positions - Low work performance of respective departments - Worry for the management board and recruitment team - Low cooperation among departments in the company because all are busy and they are working under high pressure because of manpower shortage Display Vietnam‟s organizational culture on its employees‟ job satisfaction One suggestion for further studies would be to analyze the population using different methods, test instrument, and always compare detailed findings and final results deeply The study focused on seven demographic variables: gender, marital status, education levels, age, job grade, service duration, and living area Future studies may be incorporated to include employee type, job types and shift work These studies may also include the national culture and CSR work Such incorporation and inclusion could provide better picture and view of organizational culture, job satisfaction, and their relationship as well Finally, the research was conducted in manufacturing working environment In the future, conducting similar research in trading and service industries may assist in identifying prevalent trends or possible relationships The greater the understanding of job satisfaction and organizational culture, the better an organization can maximize efficiency and productivity of its business activities Increasing employees‟ understanding of the organization, its culture, could help them be better suited with the roles they play while supporting the organization manage and motivate employees work well in all job task, engage more at work and stay longer in the company In this case, the turnover rate in the organization could reduce; consequently, recruiting and business opportunity costs could be saved accordingly All of these positive effects are for creating benefits and sustainability of the organization 5.3.2 Suggestions for the Management of LG Display Vietnam On the basis of findings of this study we recommend that LG Display Vietnam should create a supportive, cooperative and open organizational culture to raise the job satisfaction level of its employees New policies should focus more on organizational culture factors that may increase cooperation, open communication and feedback, more freedom at work, learning, and fairness in performance appraisals Role of managers and leaders to facilitate the employee should also be emphasized and they should encourage employees to take initiatives Various and diversified training should be 70 Comment [WU6]: provided to all employees of all job grades and the organizations should also have more CSR activities to support the outside community The following suggested recommendations should allow LG Display Vietnam to improve its organizational culture to empower employees through motivation, growth of opportunities, communication on important matters and supervisory support - The management of the company should motivate their employees through good compensations and benefits, welfares, promotions, more chances to make contributions to work, various training opportunities, open communication and feedback, professional standards of conduct, fair performance appraisal system, timely and proper planning As mentioned above, more consideration should be extended to the employees‟ salaries, benefits and welfares It is illustrated that those perspectives are important factors for employees to consider their stay with the company or not Although it is known that Korean companies are high with power culture in which order and guidance from highest managers are usual and number one, leaders from LG Display Vietnam are suggested to listen more from their employees‟ contributions about benefits and welfares If other companies in the same industry have better compensation and benefits for their employees, it will be reasonable for LG Display Vietnam to adjust the amount for its people in order to meet well with demands of the labor market This helps create competitiveness for the company In addition, job satisfaction and motivation are considered doubleedged swords that avert fear and anxiety from employees while urge, drives, inspire and direct their efforts to specific goals and achievements They help to induce or coax employees to achieve a certain level of performance The management should know that the organizational objectives and benefits of the company can only be achieved by the efforts of the employees Therefore, they should create the aforementioned conditions to encourage the employees to get the best of them to achieve its objectives - The management of the company should have more training programs to improve technical skills, teach about the company and foreign languages to further empower 71 employees in their jobs, develop initiative and positive attitudes The management should know that any organization that provides growth opportunities for its employees on suitable basis usually enjoys satisfactory work performance results from its employees Currently, the LG Display Vietnam employees highly appreciate different training activities which create good conditions for them to learn further knowledge and work better Training is a strongest point of the company; consequently, it is suggested that the company should maintain it while take advantage of this opportunity to give various and diversified training opportunities for its employees in order to increase their job satisfaction and motivation to work - Leaders of the company should care more about their employees‟ personal needs in terms of benefits and others, and make more important supervisory/leadership support within the organization Effective supervisory support such as support with personal and family matters, fairness in personal performance appraisal, individual and team work, can have considerable impacts on employees‟ job satisfaction If management is fair, firm and shows concern about employees‟ benefits, it could improve their trust and confidence, thereby improve their job performance It is believed that poor supervisory support is likely to frustrate employees and lower their performance and work effectiveness - The management of the company should have better and more communication through all departments and should be regular to find out how their employees are doing Effective communication such as exchange of ideas, facts, emotions, teamwork and good relationship with co-workers, friendship at work should be nourished Procedures should be put in place to ensure that there is a proper flow of information through communication from department to department Communication on important matters with employees will affect their performance, behavior and attitudes towards their jobs The management should note that the work climate on how the worker fits into the group, both office workers and like workers, can make them feel confident and accepted With the current condition that LG Display Vietnam is a biggest manufacturing company in Electronics 72 industry in Hai Phong province, it creates jobs for 20.000 employees The turnover rate is around 3% per month with nearly 600 employees are in and out per month Therefore, it is strongly believed that open communication and feedback to motivate employees to work are necessary, especially help to reduce quite high turnover rate by stopping their intention to leave - The management of the company should make more contributions to the community by having more CSR activities For the modern trend of human resources management, corporate social responsibility of the organization is an important factor for its development and maintenance of its good image to the public Employees that work for LG Display Vietnam will feel proud of working for it, and then they can have better motivation to work and expect to stay longer This, in fact, creates good side effects for encouraging employees to work while keeping them longer with the company 73 REFERENCES Amos, E.A., & Weathington, B.L (2008) An Analysis of the Relation between Employee, Organization Value Congruence and Emplyee Attitudes» The journal of psychology, 142(6) : 615-631 Bass, B.M & Avolio, B.J (1992) Developing Transformational Leadership: 1992 and Beyond Journal of European Industrial Training, 14 (5) : 21-27 Bass, B.M (1995) From Transactional to Transformational Leadership: Learning to Share a Vision In R.M Steers, L.W Poter & G.A Bigley (Eds.) 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Single Married Separated or Divorced Into which age group you fit? 18 ~ 25 years old 26 ~ 29 years old 30 ~ 36 years old Above 36 years old What is your highest level of education? Secondary/ High school College University Higher education What is your gender? Male Female What is your job grade? Senior Manager Manager Assistant Manager Engineer Unit Leader Technician Operator How long time have you been working in LG Display Vietnam? 80 24 months From which area are you? Hai Phong Near Hai Phong (E.g., Thai Binh, Hai Duong, Quang Ninh) Far from Hai Phong ( = other provinces) 81 Disagree Strongly 1 1 1 1 Disagree 2 2 2 Neutral 3 Agree 4 4 3 3 2 1 I am recognized for good work My capabilities are fully utilized I am free to make improvements on the job 5 My suggestions are listened to My morale is low My benefits are poor My anxiety of my management is high Happiness with my job is high My promotions are deserved My pay is based on my performance opinion about it question that come closest to reflect your Agree Please circle one answer for each Strongly APPENDIX C: SURVEY QUESTIONS ON JOB SATISFACTION 1 2 3 Two-way communication is present welfare The organization is interested in my 4 needs My supervisor cares about my personal I conform to accepted professional standard of conduct 82 Neutral Dissatisfied Dissatisfied Satisfied opinion about it closest to reflect your Satisfied each question that come Strongly Please circle one answer for Strongly APPENDIX D: SURVEY QUESTIONS ON ORGANIZATIONAL CULTURE management team is high Efficiency of our entire Communication in our organization is not so good Comment [WU8]: good Planning in our organization is in the organization is good Performance appraisal system people understand & believe Positive value system that in this organization team in this organization I am accepted as part of the is good Feedback in this organization People in the organization involved in the decision have the opportunity to be 4 Our organization is open to change making process widely share the same People in our organization philosophy 83 organization is good The work environment of our sufficient job training for Our organization offers employees share common set of moral People in this organization principles opportunities I have to be I am pleased with the promoted in this organization Most leaders in the values & beliefs of this organization symbolize the organization supporting community My company does it fair in projects employees of this organization Management values the officials highly appreciate my The city and government organization 4 my organization Suppliers highly appreciate highly appreciate my My friends and neighbors organization 84