Low promotion opportunities in the testing product department at bsc vietnam

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UNIVERSITY OF ECONOMIC HO CHI MINH CITY INTERNATIONAL SCHOOL OF BUSINESS NGUYEN VAN THO LOW PROMOTION OPPORTUNITIES IN THE TESTING & PRODUCT DEPARTMENT AT BSC VIETNAM MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City - Year 2021 UNIVERSITY OF ECONOMIC HO CHI MINH CITY INTERNATIONAL SCHOOL OF BUSINESS NGUYEN VAN THO LOW PROMOTION OPPORTUNITIES IN THE TESTING & PRODUCT DEPARTMENT AT BSC VIETNAM MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: DR TRAN PHUONG THAO Ho Chi Minh City - Year 2021 TABLE OF CONTENT ABBREVIATION iii LIST OF FIGURES iv LIST OF TABLES iv EXECUTIVE SUMMARY v ACKNOWLEDGMENT vi CHAPTER 1: PROBLEM CONTEXT 1.1 Company introduction .1 1.2 Business symptoms 1.2.1 High turnover rate in Testing and Product Department 1.2.2 Decrease on time delivery 1.3 The important symptoms .7 CHAPTER 2: PROBLEM IDENTIFICATION 2.1 Preliminary analysis 2.2 Possible problems 11 2.2.1 Low promotion opportunities 11 2.2.2 Poor compensation and benefits .15 2.2.3 Lack of knowledge sharing .16 2.3 Main problem validation .17 2.4 Main problem definition and consequences 19 2.4.1 Main problem definition 19 2.4.2 Consequences of the main problem 20 CHAPTER 3: CAUSE VALIDATION 22 3.1 Potential causes 22 Unclear job leveling matrix: .22 3.2.2 3.2 Ineffective performance appraisal: 24 Real cause validation 25 Unclear job leveling matrix 25 Ineffective performance appraisal .28 3.3 Main cause justification .30 CHAPTER 4: SOLUTIONS SUGGESTION 32 4.1 Alternative solutions 32 i 4.1.1 Alternative solution 1: Build Job leveling and competencies matrix database .32 4.1.2 Alternative solution 2: Build Job leveling and competencies matrix apply Willis Towers Watson approach and HR Software 36 4.2 Solution chosen 42 4.3 Action plan .43 CHAPTER 5: SUPPORTING INFORMATION 47 5.1 Research methodology summary 47 5.2 Interview transcripts 49 References 56 ii ABBREVIATION - OTD: MT: TE: OP: BSC: JD: On-time delivery KPI Maintenance team Testing and product Operation team new name of company Job Description iii LIST OF FIGURES Figure 1:Manufacturing process Figure 2: Organization chart of BSC Figure 3: Organization in Testing & Product Department Figure 4: Turnover rate monthly Figure 5: Turnover rate monthly YTD Source: Internal report of HR Department- BSC 2020 Figure 6: Turnover rate Department Source: BSC 2020 Figure 7: Turnover rate Department Source internal report BSC-2020 Figure 8: OTD chart Source: Department report-2020 Figure 9: Initial cause effect map 11 Figure 10: Updated map 19 Figure 11: Example of job leveling matrix: Source: (63) 23 Figure 12: Final cause and effect tree 30 Figure 13: Willis Towers Watson HR Software Source: (68) 37 Figure 14: Dashboard of HR software 39 Figure 15: HR software 40 Figure 16: Alternative solutions 42 LIST OF TABLES Table 1: List of employees who left BSC 10 Table 2: Job leveling comparison in BSC Synthesized by author 26 Table 3: Cost planning for solution 38 Table 4: List of employees left the BSC 48 iv EXECUTIVE SUMMARY This study analyzes the case in BSC Vietnam located in Long Thanh, Dong Nai, Viet Nam and focuses on the problem in the Testing and Production Department The symptoms are high turnover rate The symptoms analysis was conducted by intake meeting with the analysis of quality and qualitative research based on primary data from the company Some potential cause was found out based on the analyzing result, then the main problem was discovered Next steps are to list out some potential causes and find the main cause This study also proposes some alternative solutions for BSC and choose one solution that is suitable for the Department at present Based on the current issue at Testing and product Department of BSC Vietnam, this research is useful and critical for Human resources and Department can improve the situation Due to the confidential information, the real name of company could not be disclosed v ACKNOWLEDGMENT I would like to appreciate for the two years period studying in ISB Ho Chi Minh City I also would like to express my thankfulness to Dr Tran Phuong Thao for her valuable guidance Besides, I would like to thank my family; friends who always support me to finish this thesis well Especially, thanks for my colleagues who gave me valuable information and advices so that my thesis can be finished well vi CHAPTER 1: PROBLEM CONTEXT 1.1 Company introduction In 1886, BSC was founded in Germany It was the birth of today’s globally operating company From the beginning, it was characterized by innovative strength and social commitment BSC started running a subsidiary company in Paris in 1899 Start some first steps for globalization In 1921, BSC launched its garage services outside Germany, increasing very fast by 1930 there were already 2,750 workshops in 70 countries, bringing the name BSC in over the world IT started developing electronic components in the mid-1950s From the 1980s, BSC ventured into telecommunications and started constructing technology for space satellites and cell phones and implementing public and private telecommunications networks Then they started investing in the automation industry BSC Vietnam was started as the first brand office in Ho Chi Minh City in 1998, until now, it developed in locations, the business including Automation and software, Sale services and manufacturing The manufacturing plant was established in 2000 located in Long Thanh, Dong Nai, Vietnam The main product is the belt for the global automotive market This is one of the leaders in providing the component for the global car market Number of employees is around 3000 in 2020 Most of them are working in manufacturing Company products The main product of the manufacturing plan in Vietnam is auto belt for car Products manufacturing process flow: Figure 1:Manufacturing process The manufacturing processes started from raw material, which is the very first material of the product Pre-assembly parts process will use the raw material to produce the components At the assembly process, these components are assembled together to become the main product However, this product needs to be tested randomly for the quality and durability before shipping to the customers Vision and mission We make the future: Lead inspire succeed Lead: coach and empower associates to live continuous improvement Inspire: In a dynamic and open environment, all associates actively shape the future Succeed: achieve business targets and demonstrate social responsibility for a sustainable future Leading the future: this is the mission vision of BSC Step review the Leaders proposed proposed initial CptM (with review initial the Department X CptM manager and provided level team leader descriptions) & consider adding new Department review standard version from Project team and consider other competencies will be added-in/ adjusted Step Define & Dept add dept's functional Department describe dept's CptM for responsible and required areas Dept functional specific requirements for CptMs each level as detail as X HR describes Department possible Then select the required CptM levels for each dept's positions Dept defines measures to improve each CptM's level (optional), if measure is off the job training, refer training catalog Step Review CptM final Review final CptM from Team dept, Correct input from depts, Send final version to project Purpose of this step is synchronizing the CptM 45 X dictionary HR Dept correct described specific requirements to be suitable with CptM dictionary's language Step Step Consolidate HR results department Hand over, Plant wide communication Project team close project and hand over the CptM Dictionary to the Department 46 HR X X CHAPTER 5: SUPPORTING INFORMATION 5.1 Research methodology summary Qualitative methods are methods that are oriented towards the discovery of qualities of things-that is, the properties of objective, phenomena, situations, people, meaning and events There are different methods that can be used for collecting data of qualitative research such as interviews, focus groups, documentation, observation and verbal protocols This research uses interview and documentation methods Interview method is the main method for collecting research To prepare for the interview, the author needs to define the purpose of the interview, then prepare the questionnaire carefully, After preparation, conduct the interview and collect data Documentation method is also used in this study By this method, documents, reports, and procedures are used to analyze the situation Quantitative methods are oriented towards the number or amount of these qualities (57) Steps to conduct qualitative research in this project Interview method to collect data: Step 1: define the purpose of the interview, prepare a questionnaire, and collect background of the problem in Testing and Product Department in BSC Vietnam Step 2: plan for the interview and conduct interviews with people from the internal Department, Human resources, other Department and with people who already left BSC 47 Step 3: during the interview: introduction about the background of the problem, ask questions to get more information about symptoms, existing problems Documentation method: collect data from the HR department to understand more about the problem of this Department, collect test data, customer delivery data to analyze Qualitative methods of analysis we also use the Grounded Theory Approach During the diagnostics phase we develop a mini local theory, which is based on the existing theory Interview list - Mr Nguyen Huu Huy- Team Leader of Testing machine and equipment Maintenance team - Mr Truong Hoai Bao – Department Manager - Mr Do Minh Tai – Senior Engineer in Testing Department - Ms Nguyen Kim Loan – Production quality Department - Ms Tran Nguyen Bich Thao – Team Leader in Human resources Department - Nguyen Huy Dao: Process Engineer Manufacturing Department - Ms Ly- HR Department, job leveling expert Did the interview with people who already left the Department in detail on the table Table 4: List of employees left the BSC No Name of ExEmployee Group Degree Year left BSC Experience Level Vu Van Hien MT Bachelor 2020 Senior Bui Thanh Nam TE Bachelor 2020 Senior Do Minh Tai MT Bachelor 2020 Senior Le Van Tien MT Bachelor 2020 10 Senior 48 Nguyen Van Dung TE Master 2020 Junior Nguyen Hoang TE Master 2020 3.5 Junior Phuong 5.2 Le Trong Duc MT Master 2020 Junior Nguyen Doan Phong MT Bachelor 2019 Junior Tran Van Tu TE Bachelor 2019 15 Expert 10 Bui Xuan Thanh OP College 2020 Senior 11 Nguyen Van Tho TE Master 2020 Senior 12 Phan Van Thanh OP Bachelor 2019 Senior 13 Nguyen Van Quy TE Bachelor 2019 10 Senior 14 Bui Xuan Thanh OP Bachelor 2019 Senior Interview transcripts INTERVIEW TRANSCRIPT Mr Huy Interviewer: Mr Tho Interviewee: Mr Huy Date of Interview:18-Jan-21 Time of Interview: 10:00 Location of Interview: Meeting room Interview Topic: Current status at Testing and product Department Tho: Hi Huy I saw the machine's downtime increase recently What Do you think about that? Mr Huy: Yes Many machine issues happen during the year The consequence is a decreased machine testing capacity Team also spends much time and effort to solve the problem 49 Tho: Are these issues new or already happened in the past? Mr Huy: Some are new and some are already known However, the sharing knowledge between teams is not good and the record of problem solving for this issue is not properly So that team spends more time investigating the problems Tho: How is the experience of team members? Mr Huy: Some members are senior but some of them are new They don’t have much experience with the current system Tho: Why is that? Mr Huy: Some experienced guys have already left the company, some of them have switched to other Departments for further development, high turnover rate in a year Tho: you know why they leave you? Mr Huy: I know that some people seek for better positions outside the market with higher salary and growth potential, some people go to other Departments because they also want to have a good career path Tho: Do we have a good career path at the moment? Mr Huy: No, the maximum one employee can achieve in this team is level for fresh graduates, level for seniors There is no higher level for the team to try Tho: I saw a majority of them have very good performance in the past, and they also have much experience? Mr Huy: You are correct They are experienced employees with to 10 years working, some of them have Master degrees from foreign Universities So that they have high expectations for the position Mr Huy: This department now has some symptoms, but the main symptom that causes much effect on the department is the high turnover rate Because high turnover rate causes a lot of effort from the management, related department for recruitment, training 50 INTERVIEW TRANSCRIPT Mr Bao Interviewer: Mr Tho Interviewee: Mr Bao Date of Interview: 19-Jan-21, 30-Jan-21 Time of Interview: 9:00, 14:00 Location of Interview: Face to face Interview Topic: symptoms at BSC Tho: Hi a Bao As I discussed with Mr Huy, the current Department has some symptoms, what you think is the critical symptom that needs to focus now? Mr Bao: The main symptom is high turnover rate New employees join the team with less experience causing loss of productivities, increased fail rate and customer complaints I think this is what we need to focus now INTERVIEW TRANSCRIPT Mr Bao Interviewer: Mr Tho Interviewee: Mr Bao Date of Interview: 30-Jan-21 Time of Interview: 14:00 Location of Interview: Face to face Interview Topic: potential problem and main problem at BSC Tho: Do you think low payment and benefits is the current problem of BSC? Mr Bao: This is also a potential problem However, pay and benefits are included in company policy and decided by the Board of Directors Employees are discussed clearly during the interview Tho: Do you think job satisfaction is the critical problem currently? Some people said that it is because of a lack of knowledge sharing between team members? 51 Mr Bao: I think not Teams are building the knowledge sharing session weekly So that team can study together Tho: how about the promotion opportunities in the Department? Mr Bao: Yes This is the critical current and needs to be solved as soon as possible Tho: What is the effect if we don’t solve this problem? Mr Bao: serious effect to the current productivity, costly for our Department to pay for recruitment, and cost for labor hour It also affects the image of the company Tho: Thank you you’re your time Mr Bao: thank you! INTERVIEW TRANSCRIPT Mr Hien Interviewer: Mr Tho Interviewee: Mr Hien Date of Interview: Nov-20 Time of Interview: 8:00 Location of Interview: Canteen Interview Topic: Job at BSC Tho: Hi a Hien When is your last day in BSC? Mr Hien: End of this month Tho: how is the new job? Mr Hien: I will be an Engineer in the Quality measurement room responsible for building up the Lab center After that I will be promoted to a team leader to hire more staff to work for Tho: is a better salary than here Mr Hien: Yes certainly, double current salary Tho: Very good What you think about the current position? 52 Mr Hien: The remuneration growth is very slow I have worked here many years but my salary is similar to a new fresh Engineer The benefit package is also not good, uncompetitive salary Tho: Wish you success in your new role Mr Hien: thank you! Tho: how you think about yearly performance appraisal? Hien: performance appraisal session every year is not effective, it is not record employee performance to input for the promotion INTERVIEW TRANSCRIPT Mr Nam Interviewer: Mr Tho Interviewee: Mr Nam Date of Interview: 22-Dec-20 Time of Interview: 10:00 Location of Interview: Skype Interview Topic: Job at BSC Tho: Hi Tien I heard you changed Department already? Mr Nam: Yes Just last week Tho: what is your new job? Mr Nam: Project Manager Tho: Oh great your current job is project Engineers’ right? Mr Nam: Yest Promotion a little bit Tho: how was your last job in the Testing & Product Department? Mr Nam: I did a lot of things I was responsible for many topics, so that i don't have enough time to improve my skill That position is also not potential to be promoted Tho: oh How about a new job? 53 Mr Nam: Great! I specialize in project management, there is potential growth in the career path Tho: Thank! INTERVIEW TRANSCRIPT Mr Tien Interviewer: Mr Tho Interviewee: Ms Tien Human department, Job leveling matrix expert Date of Interview: 15-Jan-21 Time of Interview: 20:00 Location of Interview: Skype Interview Topic: Job at BSC Tho: Hi a Tien Why did you leave BSC? Mr Tien: I did not see the clear career goal, I don’t know where I am now and what I should next, I must leave soon Performance review not effect to salary increase INTERVIEW TRANSCRIPT Ms Ly Interviewer: Mr Tho Interviewee: Ms Ly, human resources staff, job leveling matrix expert Date of Interview: 31-May-21 Time of Interview: 11:07 Location of Interview: Skype Interview Topic: Solution for job leveling and competencies matrix Interview Topic: Solution for job leveling and competencies matrix Tho: Hy Ly, how are you? I have a topic that needs your advice? Ms Ly: Hi! I’m fine Yes, please 54 Tho: As I know you are an expert in job leveling and competencies matrix What you think about the current topic in our company in general and in the Testing and Product department? Ms Ly: I have spent a long time working on this topic in the previous company and now I think the job leveling and competencies matrix are very important for the development of the company This topic needs to be implemented as soon as possible to help the company reduce the high turnover rate Especially in the Testing and Product Department Tho: Do you know which way we can carry out this topic in the company? Ms Ly: As I know we have possible ways to implement this First, if we can study and refer to the basic background from the mother company Then compare with the specific job position and level of the current company and modify a suitable one Second, if there is no background from another company, we need to build a completely new job leveling and competency matrix, then we need to hire a consultancy company to get training and advice Tho: how you think the job leveling matrix is important? Ms Ly: It is crucial for the development of the company as well as the development of employees’ career path With a clear definition of job level and requirement, employees themselves can access the system and check what competencies they need to improve They also know which requirements they need to meet to grow up to the higher level in their career path Tho: this is quite a lot of information Thank you very much Ms Ly: You are welcome Thanks! Tho: how can we apply this? Ms Ly: Firstly, refer to the job leveling matrix of BSC worldwide and BSC Vietnam, then modify for suit with Testing & Product Department By this way we can follow the 55 same view with BSC global This is more important than ineffective performance appraisal References Luyanje EA A study on management staff reactions to promotion on merit: a case study of city council of Nairobi managers 2008 Baker GP Incentives in hierarchies: Promotions, bonuses and monitoring: Division of Research, Harvard Business School; 1988 Christopher CO, Ogunyomi PO, Badejo AE Promoting ethical human resource management practices in work organizations in Nigeria: Roles of HR professionals International Journal of Human Resource Studies 2012;2(2):116 Phillips DJ, Sørensen JB Competitive position and promotion rates: Commercial television station top management, 1953–1988 Social Forces 2003;81(3):819-41 Armstrong M A handbook of human resource management practice: Kogan Page Publishers; 2006 Ferris GR, Judge TA Personnel/human resources management: A political influence perspective Journal of management 1991;17(2):447-88 Pergamit MR, Veum JR What is a promotion? 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Lattice [Internet] Jun 2021 Available from: https://lattice.com/library/what-is-a-job-leveling-matrix 64 Michelle Villegas Threadgould What Is Job Leveling and How Does It Work? Lattice [Internet] Jun 2021 Available from: https://lattice.com/library/what-is-job-leveling-andhow-does-it-work 65 Andy Przystanski What Are Job Competencies and Why Do They Matter? Lattice [Internet] Jun 2021 Available from: https://lattice.com/library/what-are-job- competencies-and-why-do-they-matter 66 Michael O’Malley Job Leveling’ Helps to Grade a Position’s Value Sibson Consulting December 22, 2015 [Internet] Available from: https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/job-leveling.aspx 67 Willistowerswatson [Internet] Jun https://www.willistowerswatson.com/ 59 2021 Available from: ... ECONOMIC HO CHI MINH CITY INTERNATIONAL SCHOOL OF BUSINESS NGUYEN VAN THO LOW PROMOTION OPPORTUNITIES IN THE TESTING & PRODUCT DEPARTMENT AT BSC VIETNAM MASTER OF BUSINESS ADMINISTRATION SUPERVISOR:... problem, the intake meeting with the Employee in BSC to find out the symptoms and understand deeper the current problem of the organization Intake meeting with employee in the Testing & Product Department. .. Departments The turnover rate in the Testing and product Department is over limited Let's analyze the primary data from the HR Department to find out the current symptoms of BSC According to the data
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