Nghiên cứu trả công lao động tại ngân hàng thương mại cổ phần đầu tư và phát triển việt nam TT TIENG ANH

MINISTRY OF EDUCATION AND TRAINING THUONGMAI UNIVERSITY - PHAM THI THANH HA RESEARCH TOTAL REWARD MANAGEMENT AT BANK FOR INVESTMENT AND DEVELOPMENT OF VIETNAM Major Code : Business management : 9340101 Summary of economic doctoral thesis Hanoi, 2021 The study was complete in Thuongmai University Instructor: Assoc Prof Dr Nguyen Thi Minh Nhan Dr Nguyen Thi Lien Reviewer 1: …………………………………………………………………………… Reviewer 2: …………………………………………………………………………… Reviewer 3: … The thesis will be presented in front of the University’s Thesis Evaluation Council, meeting at Thuongmai University At…… hour… …….date………… month…… year………… This thesis can be found at: National Library of Vietnam Library of Thuongmai University LIST OF SCIENTIFIC STUDIES RELATED TO THE THESIS Pham Thi Thanh Ha, Phan The Cong (2016), Opportunities and Challenges of Vietnam’s commercial banks when entering the Asean economic community, International Conference “The economy of Vietnam in the integration period: Opportunities and Challenges” Pham Thi Thanh Ha, Nguyen Thi Minh Nhan (2018), Theoretical overview on labor remuneration and remuneration management: International perspectives and in Vietnam, Vietnam Trade and Industry Review, No.2 – 2/2018 Pham Thi Thanh Ha (2019), The research model on the labor remuneration at Vietnamese commercial banks, Vietnam Trade and Industry Review, No.1 – 1/2019 Pham Thi Thanh Ha (2019), Problems for salary policy in the context of international integration and industrial revolution 4.0, National Conference “Human resource management in the context of international integration and industrial revolution 4.0” Pham Thi Thanh Ha (2020), The structure of labor remuneration at Vietnam’s commercial banks, Vietnam Trade and Industry Review, No.4 – 3/2020 Pham Thi Thanh Ha (2020), Human resource policies in multinational corporation: Some implications for Vietnamese enterprises in establishing human resource policies aiming towards global citizen, National Conference “Develop human resource aiming towards global citizen” Pham Thi Thanh Ha, Nguyen Thi Minh Nhan (2021), The study of factor affecting to total rewards management at bank for investment and development of Vietnam, No 154 – 6/2021, Journal of Trade Science, No 154/2021 Pham Thi Thanh Ha (2021), Human resource management of Vietnam’s commercial banks in the context of digital transformation: Opportunities and challenges, National Conference “Digital transformation and Human resource management ” INTRODUCTION Rationale of the research Total reward management (TRM) is approached from many aspects and is called by many names such as wage, salary, wages, remuneration, labour compensation, etc Since the middle of the 17th century, to research the nature of wages, classical British economists such as W Petty, A Smith, D Ricardo agreed with the viewpoint “wages are the price of labour” However, at the beginning of the 19th century, K.Marx determined the true nature of wages and identified wages as the price of labour-power In today's competitive and modern business environment, wages are not simply the price of labour-power but also the reflection of labour relationship between employers and employees (Labour Code, 2019; Pham Cong Doan, 2012; Tran Kim Dung 2015) and total reward management is not just the expense that organisation pays employees to make up for their past labour-power but also the investment for future abilities from labour (F Herzberg, 1959; Le Quan, 2016) In other words, TRM has to make up for past labour-power and at the same time guarantees the reproduction of simple and expanded labour-power Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) was founded on April 26 1957 with the name the Bank for Construction of Vietnam After 64 years of establishment and development, BIDV has undergone changes of names and management units Till now, BIDV is a joint-stock bank with special-class state-owned capital, organised in the form of a corporation and is one of the biggest banks in the nation with a total asset of over 1.5 million billion VND and almost 27 thousand staff and employees BIDV’s network spreads across the country with 189 branches nationwide, 01 branch overseas, presence in countries and territories, 906 transaction offices, with over 10.4 million personal customers (accounting for 11% of the country’s population), over 200 thousand corporate customers and cooperation relationships with more than 2,300 financial institutions around the world TRM at BIDV still experiences some limitations as follows: objectives of TRM have not been particularized, the organisation of TRM has not been specialised, training is not effective, the implementation of TRM programs still has many difficulties in the evaluation and implementation process; the measurement standard and criteria have not been identified clearly; the process of measurement for evaluation has not yet been actively carried out; BIDV has not been drastic in the adjustment of existing issues in TRM process; the proportion of fixed-wage and variable wage is not reasonable, the payment method of variable wage according to KPI and sales has not yet created motivation for workers, TRM in the form of non-financial part is mainly working environment, training, fostering, career development but has not yet been mentioned as a paid amount, thus its advantages in employees’ attraction, motivation and retention, etc have not yet been highlighted Stemming from the aforementioned reasons, the topic “Research on total reward management at Joint Stock Commercial Bank for Investment and Development of Vietnam” has been chosen as the doctoral thesis of the PhD student Research overview 2.1 Researches on “Total reward management” The research theme on TRM is studied by many domestic and foreign scholars TRM can be defined by many different terms and can be approached according to management or the structure approach, but overall researchers share the same viewpoint that TRM is the process of organising payments for labour that are adequate with their efforts and contributions to the organisation Within the scope of the thesis, TRM is studied according to management approach; the structure of TRM is combined in the research to reflect the outcome of TRM process to clarify the amounts that commercial banks pay to employees with the elements, proportions of total amounts in bringing satisfaction to labour Thereby, helping the evaluation of the current situation of TRM to be more objective and accurate 2.2 Studies of “Factors influencing total reward management” Studies of factors influencing TRM have affirmed that: legal regulations on TRM, operational efficiency, human resource strategy, competencies of TRM team, and organisational culture affect the TRM However, the research works are mainly in qualitative form and some of the works are conducted quantitative analysis in different scopes and subjects In Vietnam, there have not been any studies using quantitative research methods on factors influencing TRM at BIDV 2.3 Studies on “Total reward management in banking industry” Studies on TRM are approached in different aspects both in the country and overseas, some works and documents have mentioned the process of TRM, the structure of TRM, the factors influencing TRM Among those researches, there has been a study on TRM in the banking industry and BIDV but it has stopped at analysing financial amounts and evaluating the impact of TRM on commitment, satisfaction, motivation and performance of employees, there has not been any research document on TRM systematically including the process of TRM, the structure of TRM, factors influencing TRM associated with the characteristics of the job and human resources in commercial banks; There has not been any research that fully evaluates and analyses the scientific basis on TRM at BIDV 2.4 Research gaps and inherited scientific values The overview has determined "gaps" that need to be further studied, which are: - The systematic theoretical framework on TRM is associated with the characteristic of commercial banks including Definition of TRM; Human resource traits of commercial banks; TRM process, TRM structure; Factors influencing TRM - Analysing and evaluating in a scientific way the current situation of TRM at BIDV; Evaluating the influence level of factors on TRM at BIDV - System of solutions and recommendations to improve TRM at BIDV From the identified gaps, the research direction of the thesis is new with the inheritance and development of some research results from published works on the principle of TRM in an organisation Accordingly, research questions of the thesis are identified as follows: (i) What is the scientific ground of TRM in commercial banks? (ii) What is the current situation of TRM at BIDV and the influence of factors on TRM at BIDV? (iii) What needs to be done to complete TRM at BIDV? 3.1 Objectives of the research The research objective of the thesis is to propose solutions mainly with scientific basis and practical basis to complete TRM at BIDV Firstly, building research framework on TRM in commercial banks: Definition of TRM; Human resource traits of commercial banks; TRM process, TRM structure; Factors influencing TRM Secondly, analysing and evaluating the current situation of TRM process and structure at BIDV; Examining the influence level of factors on TRM at BIDV Finally, proposing opinions and solutions to complete TRM at BIDV to 2025 and vision to 2030 Subject and scope of the research 4.1 Research subject The subject of the research is TRM at commercial banks in general and at BIDV in particular 4.2 Scope of the research Scope of space: Studying the current situation at BIDV The survey of the research is carried out at 50 branches of BIDV in the North, Central and South of Vietnam Scope of time: The current situation of TRM at BIDV between 2016 and 2020 Proposing solutions to complete TRM at BIDV to 2025 and vision to 2030 Scope of content: The thesis chooses management approach with research framework formed with a number of key aspects (see Figure 1) as follows: Figure 1: Research framework of the thesis Source: Proposal of PhD student (i) TRM process in commercial banks from TRM planning, TRM implementing to TRM evaluating (ii) TRM structure in commercial banks with main elements including financial parts (fixed wage, variable wage, bonuses and benefits); non-financial parts (work environment, training, fostering, career advancement) These are key products of TRM process (iii) Factors influencing TRM at commercial banks including: legal regulations on TRM, operational efficiency, human resource strategy, competencies of TRM team, organizational culture 5.1 Qualitative research method 5.3.1 Primary data collection method (i) Depth Interview method On the basis of literature review and carrying out depth interviews from 08 experts with extensive knowledge on TRM that are working at: Labor Relations Development Support Center; Institute of Labour Science and Social Affairs; The Ministry of LabourInvalids and Social Affairs; National Wage Council; Vietnam General Confederation of Labour; Lecturers at universities specialised in human resource management to collect data, sort and adjust observed variables on the contents of TRM process and factors influencing TRM process After adjusting the survey sheets, the author carries out preliminary qualitative research to test for the scale; Collecting additional about the assessment and feelings of the interviewees about the current situation of TRM process and TRM structure (ii) Professional solution This paper consulted and used opinions of 06 experts on TRM, leaders, managers and staffs in charge of TRM at BIDV and experts at BIDV Opinions of experts were obtained directly through seminars organized by State management agencies, the Ministry of Home Affairs and universities The aim of this method is to evaluate the process and structure of TRM, factors influencing TRM On that basis, adding data for analysis and more appropriate comments in the thesis (iii) Survey method The survey subjects are managers, staffs and employees at BIDV; Survey content for the purpose of providing information on the current situation of TRM at BIDV about the process and structure of TRM and factors influencing TRM; The number of questionnaires distributed was 900 and 671 votes were collected, of which 653 were valid, accounting for 72.56% of the total number of votes 5.3.2 Secondary data collection method Researching the theoretical basis: From textbooks, monographs, research topics at all levels, domestic and foreign journal articles to establish theoretical framework on the structure and process of TRM and factors influencing TRM Using secondary data that are collected from financial reports of banking industry, financial report of BIDV, regulations, requirements and documents related to TRM at BIDV, Labour Code, Decrees, Decisions, Directives, domestic and international specialised journals, etc to collect secondary data on the current situation of TRM process and structure and the factors influencing TRM at BIDV In addition, to process data, the research uses methods such as scientific abstraction, inductive and deductive methods, analysis and synthesis methods, statistics and comparisons; Combined with illustrations with tables, figures, and boxes, the research problem becomes clearer and more intuitive 5.4 Quantitative research method 5.4.1 Preliminary quantitative research Preliminary quantitative research was conducted at branches of BIDV in Hanoi city with 150 survey sheets issued, 142 survey sheets were collected with 112 valid survey sheets Afterwards, the test of scale reliability was carried out through Cronbach’s Alpha coefficient and Corrected Item Total Correlation Based on the preliminary research result, the research model and scale are adjusted 5.4.2 Formal quantitative method On the data basis from 50 BIDV’s branches around nation, 653 valid survey sheets were collected, in which 171 survey sheets are from managers about the structure and process of TRM and factors influencing TRM; 482 sheets are from staffs and employees on the structure and process of TRM and factors influencing TRM Collected data was uncluttered, coded, then entered into the system using SPSS and AMOS 21 software The data were analysed by the following techniques: descriptive statistics of collected data; calculating the mean, standard deviation and variance for the scales of the goals of TRM, the structure of TRM; Assessing the reliability of the scale; Exploratory Factor Analysis (EFA); Confirmatory Factor Analysis (CFA); analysing structural equation modeling; Boostrap test In summary, by combining research methods, the PhD student has acquired complete, complete, multi-dimensional and objective information about the current situation of TRM at BIDV New contributions of the thesis (i) Establishing a theoretical framework for TRM in commercial banks, including: The definition of TRM; Labour characteristics of commercial banks; TRM process from the planning of the TRM, the implementation of TRM to the assessment of the TRM; The structure of TRM consists of the following components: financial parts (fixed wage, variable wage, bonuses and benefits), non-financial items (working environment, training, fostering, and career advancement) (ii) Building a research model of factors influencing the TRM process associated with the characteristics of commercial banks, establishing hypotheses, selecting variables and scales suitable to the context and research purposes In which, the independent variables: legal regulations on TRM operational efficiency, human resource strategy, competencies of TRM team, organizational culture; The dependent variable is the TRM process (iii) Performing the ananlysis and evaluation of current situation of TRM at BIDV through the process and structure of TRM (iv) Testing for the influence of factors on TRM process at BIDV and the regression equation demonstrating the relationships between variables: TCLD = 0,41 HQ + 0,397 NL + 0,295.CL + 0,168 PL + 0,123.VH In which, operational efficiency has the strongest impact of TRM at BIDV followed by the competencies of TRM team, human resource strategy and organizational culture (v) Synthesizing and proposing major viewpoints and solutions to improve TRM at BIDV on the basis of conclusions about successes, limitations and causes leading to limitations on TRM at BIDV; studying BIDV's development strategy to 2025 and vision to 2030 Thesis structure In addition to table of contents, the list of acronyms, the list of tables, figures, boxes, the introduction and conclusion, the list of references, the appendix, the thesis is divided into chapters: Chapter 1: Theoretical basis on TRM in commercial banks Chapter 2: Current situation of TRM at Bank for Investment and Development of Vietnam Chapter 3: Solutions to complete TRM at Bank for Investment and Development of Vietnam CHAPTER THEORETICAL BASIS ON TOTAL REWARD MANAGEMENT IN COMMERCIAL BANKS 1.1 Overview of commercial banks’ employees and TRM in commercial banks 1.1.1 Definition of commercial banks and employees’ characteristics of commercial banks - Definitions Bank is an enterprise mainly carrying out currency business, regularly providing deposit receipt services and uses deposits to extend credit, provide payment services, investment and other related business activities Commercial bank is an enterprise specializing in providing regular services of receiving deposits, granting credit, providing payment services through accounts and other business activities according to the Law for the profit target - Employee’s characteristics of commercial banks Working in a specific industry, employees in commercial banks have unique characteristics such as: Firstly, employees in commercial banks is very diverse Secondly, employees in commercial banks is associated with the implementation of monetary business objectives, credit provision and service provision Thirdly, employees in commercial banks regularly interact with customers Next, employees in commercial banks perform work that is usually organized according to scientific process Moreover, employees in commercial banks often has to update knowledge Finally, employees in commercial banks requires communication skills, carefulness, honesty and strict compliance with regulations In addition, employees in commercial banks is always associated with risks that come with a lot of pressure 1.1.2 Definition of TRM in commercial banks Definition of TRM: TRM is the process of paying non-financial and financial parts to workers with reasonable structure based on the agreement between employer and employee, commensurate with the job position and the contribution of workers to organisation Definition of TRM in commercial banks: TRM in commercial banks is the process of paying parts to workers with reasonable structure based on the agreement between commercial banks and employees, commensurate with the job position and the contribution of workers to commercial banks The definition shows the key issues of TRM in commercial banks, which are: Firstly, how should commercial banks plan TRM? How to implement TRM plan? How to evaluate TRM? TRM process takes place constantly in association with the operation process of commercial banks Secondly, what are the payments that commercial banks pay to employees? The amounts that commercial banks pay to employees include financial amounts such as fixed wage, variable wage, bonuses and benefits and other form of non-financial parts which are core elements such as work environment, training, fostering, career advancement 10 fostering programs, implementing career development program) 1.2.3 TRM evaluation The content of TRM evaluation in commercial banks include: Identification of TRM evaluation standard (tcld10); Measurements of key outcomes of TRM (tcld11); Implementation of TRM adjustment (tcld12) - Identification of TRM evaluation The standard for TRM evaluation must be associated with the responsibility of the subject in charge The standard for TRM evaluation includes qualitative and quantitative standard - Measurements of key outcomes of TRM Methods of measuring the outcomes of TRM: statistical data analysis method, method of using warning signs, method of direct observation and personal contact, questionnaire method - Implementation of TRM adjustment Contents that need to be adjusted are mainly related to following activities: Adjusting goals, adjusting the structure of TRM program, adjusting and adding regulations and requirements related to TRM, adjusting TRM program, adjusting the organizational structure of TRM, adjustment related to internal communication, training human resources to implement TRM In addition, if there are issues with the evaluation process of TRM about the standards and measurement methods, the staffs in charge of TRM also make proposal to have reasonable adjustments to achieve a smooth TRM process and improve the efficiency of TRM implementation process 1.3 The structure of TRM in commercial banks TRM structure is the product of TRM process, it shows the amount that commercial bank pays to employees, the proportion of total amounts and the evaluation of the employees (the level of satisfaction) with the structure of TRM Components in TRM structure (see Figure 1.2) Figure 1.2: Structure of TRM in commercial banks Source: Proposal of PhD student 1.3.1 Financial parts - Fixed wage Fixed wage is the amount of money that commercial banks pay employees on a monthly basis based on the wage of the employees’ position and the actual working time in the month of the employees The forms of fixed wage payment often applied at commercial banks are time-based wages and position-based wages The fixed wage is established by core components such as: Job title (wage level); Wage grade of each title (wage level); The wage corresponding to each job position is adequate with the work value; The distance between two adjacent wage levels ensures distinction; The gap between two adjacent wage grades is reasonable; Fair paid fixed wages; 11 Fixed wage guarantees a standard of living - Variable wage Variable wage is the amount of money that commercial banks pay employees based on their work performance in the evaluation period The payment forms of variable wage that commercial banks can apply are: Paying variable wage according to capacity; Payment of variable wage according to labor productivity; Payment of variable wage according to KPI; Payment of variable wage based on sales Variable wage is demonstrated through: Satisfaction with variable wages applied by commercial banks; Suitability of variable wages; Satisfaction with the method of paying variable wages according to sales; Variable wage according to KPI is paid publicly and transparently; Variable wages is adequate with work results; Variable wages are paid fairly; Variable wages are calculated accurately and completely - Bonuses and benefits + Bonuses: The amount that commercial banks pay employees in the form of cash based on year-end results of commercial banks, outstanding results, outstanding achievements of employees at work and activities, examples that are respected and recognized by the society Bonus forms in commercial banks: Year-end bonus; Bonus for innovation initiatives; Bonuses for excellent completion of tasks for many consecutive years; Dedication bonus (recognizing contributions to the development of commercial banks); Extraordinary bonus; Special bonus (good examples, activities for the society and community that are honoured, etc.) Bonus levels and bonus calculation for each type of bonus comply with the laws and regulations of each commercial bank + Benefits: The amount that commercial banks pay employees in the form of service packages or cash to improve the lives of employees At commercial banks, the forms of benefits include: Compulsory benefits: pay for non-working days, social insurance, health insurance, unemployment insurance (in compliance with the law); Voluntary benefits: health care service packages, insurance, retirement benefits, insurance in case of risks, travel, study promotion, etc In addition, commercial banks also pay the benefits in cash form such as benefits for clothing, benefits for employees protection, birthday money, funeral, wedding, etc Basic contents of bonuses and benefits that commercial banks need to focus on are: Accurate and fair bonuses that motivate workers; Compulsory benefits are fully and accurately implemented; Satisfaction with voluntary benefits; Benefit regimes are concerned and well-implemented; Benefits in cash form are fully and properly implemented; Cultural, sports and art activities are organized regularly and are highly participated by employees, etc 1.3.2 Non-financial parts In this research, at commercial banks, non-financial parts are gathered into groups: work environment; training, fostering; career advancement - Work environment Work environment is the working conditions and relationships at work that commercial banks create for employees during working process 12 The working environment in commercial banks is demonstrated through: Green, comfortable and pleasant working space; Adequate and suitable equipment and machinery; Safe, hygienic, clean, cool and spacious workplace; Scientific workplace design; Work is not under pressure; Internal communication is well-performed - Training and fostering Training and fostering are non-financial parts that commercial banks provide to employees to help them complete and improve their own capacity Exhibitions of training and fostering in commercial banks are: Learning encouragement, fostering to improve qualifications; Organising training classes, fostering and training skills and professions; Appropriate training, fostering and retraining programs; Facilitating conditions and supports for employees to study and improve their qualifications; Facilitating conditions for employees to improve their professional qualifications; Applying the outcomes of training and fostering to work - Career advancement Career advancement is non-financial part that commercial banks provide to employees in order to create opportunities for employees to take on different job positions or job positions with higher job ranks that are adequate with their abilities, their capacity and performance Career advancement in commercial banks is created by following elements: Clear and public career advancement; Creating opportunities for employees to advance; Create conditions for professional development; Job rotation creates favourable conditions for employees to diversify their professional expertise; Public, democratic and transparent staff planning; Appointing the right people in the right position, following the right, open and transparent process; Fair and equal career development policy of commercial banks 1.4 Influence of factors on TRM in commercial banks 1.4.1 Some factor influencing TRM in commercial banks - Legal regulations on TRM TRM in commercial bank is governed and influenced by legal regulations on TRM Reasonable and suitable regulations on TRM will guide commercial banks in the process of TRM In contrast, unreasonable and inconsistence TRM will hinder and restrain the business activities of commercial banks and cause conflicts in the process of TRM - Operational efficiency of commercial banks Efficiency has a strong impact on TRM through business efficiency indicators such as ROA, ROE, EPS and employees efficiency index such as productivity and profitability of workers Good operational efficiency will create favourable conditions for a smooth TRM process and vice versa, poor operational efficiency will cause great hindrance to the TRM - Human resource strategy of commercial banks Human resource strategy has great impact on TRM To implement commercial banks’ goals, TRM needs close connection to human resource strategy such as planning, recruitment, training and development, performance management, etc - Competencies of TRM team 13 The team in charge of TRM needs to have knowledge, skills, attitudes and vision, strategy on TRM In addition, to meet the job requirements the TRM team needs to be regularly trained and fostered - Organisational culture Organisational culture influences on TRM through the application of result-oriented culture by commercial banks, commercial banks only care about the work of employees, employees are open and friendly, employees have the chance to make their own decisions at work, departments cooperate at work, performance measurement is seriously considered 1.4.2 Model of factors influencing TRM in commercial banks - Research model: Figure 1.3: Research model on factors influencing TRM in commercial banks Source: Proposal of PhD student Model on factors influencing TRM in commercial banks include: independent variables, which are pl, hq, cl, nl vh; dependent variable, which is TRM (tcld) and a total of 38 observed variables - Research hypotheses Hypothesis (H1): Legal regulations on TRM has a positive influence on TRM in commercial banks Hypothesis (H2): Operational efficiency has a positive influence on TRM in commercial banks Hypothesis (H3): Human resource strategy has a positive influence on TRM in commercial banks Hypothesis (H4): Competencies of TRM team has a positive influence on TRM in commercial banks Hypothesis (H5): Organisational culture has a positive influence on TRM in commercial banks 14 CHAPTER CURRENT SITUATION OF TOTAL REWARD MANAGEMENT AT BANK FOR INVESMENT AND DEVELOPMENT OF VIETNAM (BIDV) 2.1 Overview of BIDV 2.1.1 Establishment and development process BIDV was established on April 26 2957 under Decision No 177-QD/TTg of the Prime Minister with the original name of Bank for Construction of Vietnam After over 64 years of establishment and development, through times of renaming and changing the management unit, the bank is now called Bank for Investment and Development of Vietnam (BIDV), which operates in the finance-banking sector with the main function and mission of capital mobilization, credit provision, provision of banking and non-banking services in accordance with the law and other services according to the business registration certificate 2.1.2 Functions and missions of BIDV BIDV is a joint stock commercial bank controlled by the State with the main functions and missions of capital mobilization, receiving and borrowing according to the provisions of law and guidance of the State Bank BIDV has the duty to effectively use, preserve and develop the assigned capital, assets and other resources to perform business goals 2.1.3 Organisational structure of BIDV BIDV is a special class state-owned joint stock enterprise, organised according to the structure of a state-owned joint stock corporation BIDV is organised according to a consistent system including: Headquarter; The affiliated units include transaction offices, branches, representative offices, non-business units; Subsidiaries; and Affiliated Companies BIDV's organisational structure follows the direction of a vertical organizational structure 2.1.4 Employees’ characteristics of BIDV The number of BIDV’s employees is very large (as of December 31, 2020 the number of employees is 26,752 people) due to the expansion in scale and merger In the 2016-2020 period, the fluctuation of BIDV's labour force is not large in terms of quantity and quality BIDV is a large bank that not only has the advantage of scale, financial ability but also the potential of labour (large number of employees with high quality) is also an advantage to help BIDV compete with other banks in a fiercely competitive environment of financial market 2.1.5 Business results of BIDV in the period of 2016-2020 BIDV is a joint stock commercial bank with the largest charter capital among commercial banks in Vietnam today BIDV's business activities in the period 2016-2020 had prospered and had made great contributions to the establishment and development of the nation 2.2 Current situation of TRM process at Bank for Investment and Development of Vietnam 2.2.1 Current situation of TRM planning at BIDV - Identification of TRM’s goals The identification of TRM’s goals is mentioned in regulations and documents about TRM of BIDV but only at a general level such as “attract and engage employees; associate with business results, ensure the balance and 15 suitable of finance in each period, etc.” The acknowledgement is not really clear and specific to each component of TRM structure about the goals such as employees attraction, employees retention, motivating and engaging employees, effective cost management, performance enhancement - Creating regulations and requirements on TRM The regulations on TRM were developed and issued for the first time in 2006 - Promulgating requirements guiding the payment of labour BIDV develops detailed regulations, clear and easy-to-understand guidelines for important contents of TRM, such as related to the payment of variable wage according to sales, variable wages according to KPI, staff evaluation, regimes for staff rotation, transfer, etc - Developing TRM programs The development of TRM programs includes the development of programs associated with financial and non-financial parts - Identifying the TRM fund The payment fund for TRM activities includes: fund for financial parts and fund for non-financial parts At BIDV, the identification of TRM fund includes tasks such as: identifying the fund to pay for financial parts and distributing this fund to the unit; identifying the fund for non-financial parts 2.2.2 Current situation of TRM implementation at BIDV - Organisation of TRM apparatus The specialised department in charge of TRM is a part of BIDV’s human resource management apparatus The department assigned to be responsible for human resource management is the Human Resources Committee In the organizational structure, BIDV places Human Resources Committee as a specialized committee under the Board of Directors After that, there is the Human Resources Department under the Executive Board and in the branches, there are Organization Administration departments, Planning - Finance departments in charge of TRM - Organisation of internal communication on TRM Direct communication is performed at conferences, employees’ gatherings or meetings Indirect communication, which is done through internal message boards, BIDV's website or sending SMS, E-mail to each employee, is also deployed by BIDV at the same time with direct communication - Training human resources to implement TRM The training implementation is divided into phases: Phase – Training for the team in charge of implementing TRM at BIDV; Phase – Training for the total remaining employees of BIDV - Implementation of TRM programs + Bases for implementing TRM program: KPI evaluation results; Capacity evaluation results; Evaluation of TRM’s sense + Conducting the payment for financial and non-financial parts: Fixed wages; Variable wages based on labor productivity; Variable wages based on sales; Variable wages based on KPI; Implementing bonuses programs; Implementing benefits programs; Implementing working environment improvement program; Implementing training and fostering programs; Implementing a career advancement program 2.2.3 Current situation of TRM evaluation at BIDV - Building standards for TRM evaluation BIDV has set qualitative and quantitative evaluation standards for financial and non-financial parts in order to grasp the current 16 situation of TRM However, at BIDV, the development of standards for evaluating TRM standards is still incomplete, unclear and has not been issued in written form - Measuring main results of TRM The measurement method for TRM results used by BIDV is mainly statistical data analysis such as settlement of fixed wage, variable wage based on sales, variable wages based on KPI, bonuses, settlement of benefits, improvement of working environment programs, benefits programs, training and fostering programs - Implementing the adjustment of TRM Some of the adjustments that BIDV made such as: Adjusting, supplementing, building new regulations, requirements and guidelines on TRM; Adjusting TRM programs, removing and replacing unsuitable and ineffective ones; Adjusting training methods; Adjusting and supplementing internal communication methods on TRM; Adjusting the process of implementing TRM programs 2.3 Current situation of TRM structure at BIDV 2.3.1 Current situation of financial parts at BIDV The proportion of fixed wages, variable wages, bonuses and benefits in the total financial parts in the period of 2016-2020 had a clear change in 2020 (see Table 2.1) Table 2.1: Structure of financial parts BIDV paid employees Unit: billion VND Financial parts Wage Bonuses benefits Total 2016 2017 2018 2019 2020 Qty % Qty % Qty % Qty % Qty % Fixed 5.319,6 71,6 5.918,7 71,0 6.339.5 71,4 6.928,2 71,2 4.976,7 49,19 Variable 1.452,8 19,5 1.272,9 15,2 1.337,1 15,0 1.450,7 14,9 3.269,6 32,32 and 656,2 8,83 1.139,1 13,6 1.201,3 13,5 1.343,5 13,8 1.871,0 18,49 7.428,6 100 8.330,7 100 8.877,9 100 9.722,4 100 10.117, 100 Source: Annual report 2016, 2017, 2018, 2019, 2020 of BIDV - Fixed wage Fixed wage is a very crucial element in the structure of TRM, accounting for nearly 50% of the total age that employees receive and with an average score of 4.23/5.0 on the satisfaction of employees, employees have shown that BIDV is doing very well in converting the old wage mechanism into the current position-based wage - Variable wage BIDV applies variable wage payment methods including: variable wages based on employee productivity; variable wages based on sales; variable wages based on KPI; and other variable wages parts Variable wages achieved an average score of 3.84/5.0 with an average level of satisfaction - Bonuses and benefits + Bonuses that BIDV is applying are: Year-end bonus; Bonus for initiatives to improve and increase labor productivity; Cost savings bonus and other bonuses 17 + Benefits: Compulsory benefits are deduction amounts from labour’s wages, which are fully and legitimately performed by BIDV in accordance with the provisions of labor law Days off with full wage are also clearly regulated by the bank to ensure compliance with laws and regulations on financial revenue and expenditure of BIDV; Voluntary benefits: supporting employees to buy extra insurance, social security, study promotion, vacation visit, cultural movement activities, arts and sports, etc In addition, direct expenses to employees are of a benefit nature 2.3.2 Current situation of non-financial parts at BIDV - Work environment BIDV is equipped with necessary and modern equipment suitable for different job positions The workplace space is also taken care of to create a clean, safe and cool working and resting environment Internal communication is also performed by BIDV both directly and indirectly through meetings, exchanges or through documents, emails, etc Work environment is evaluated as satisfied at 3,72/5.0 –a fairly average level - Training, fostering Employees at BIDV have the opportunity to be trained, fostered and improved their qualifications and professional skills to match current and future job requirements BIDV's policy of training and fostering is highly valued, this is the brightest point in the structure of non-financial parts with a high level of employee satisfaction (4.11/5 points) and other criteria all have score of over 4, which shows that BIDV is very focused in training and improving qualifications, expertise, skills and professionalism for employees - Career advancement BIDV has developed and promulgated regulations on staff planning, appointing and rotation to help employees orient and strive to work for career advancement All work related to planning, appointment/re-appointment is directly directed by BIDV's Board of Directors and implemented to ensure democracy, publicity, transparency, in accordance with the process and regulations from planning, training and fostering after planning, appointing, rotation and mobilization The assessment of the level of satisfaction as fairly average (3.66/5.0) for career advancement at BIDV 2.4 Analysis of factors influencing TRM at BIDV 2.4.1 Testing for the model of factors influencing TRM at BIDV In fact, the factors influencing TRM are the impacts on the process of TRM, which are determined from 653 employee questionnaires from 50 branches of BIDV across the country with the following results: testing the reliability of the scale, EFA, CFA, SEM model and Bootstrap test The linear regression equation shows the relationship between the variables in the model as follows: TCLD = 0,41 HQ + 0,397 NL + 0,295.CL + 0,168 PL + 0,123.VH The quantitative results show that TRM at BIDV is influenced by following factors: operational efficiency, competencies of TRM team, human resource strategy, legal regulations on TRM, organizational culture However, the influence level and the role of the factors are not completely the same In particular, the impact of the factors to TRM at BIDV 18 are as follows: operational efficiency (0.41), competence of TRM team (0.397), human resource strategy (0.295), legal regulations on TRM (0.168), organizational culture (0.123) 2.4.2 Current situation of factors influencing TRM at BIDV - Operational efficiency of BIDV To BIDV, operational efficiency is a determination factor of all activities from businesses to policies for workers - Human resource strategy of BIDV BIDV's human resources strategy is illustrated in the development strategy for the period of 2020 - 2025, with a vision to 2030 - Legal regulations on TRM Legal regulations and administrative mechanism in Vietnam have decisive influence on bank’s activities, including TRM - Organisational culture of BIDV Some bad cultures have existed for a long time, causing obstacles to TRM activities and reducing business efficiency Thus, through analyzing the current situation of factors influencing TRM by secondary data and testing the influence of those factors by quantitative analysis, it shows that: operational efficiency, competencies of TRM team, human resource strategy, legal regulations on TRM, and organizational culture all affect TRM at BIDV, but to different degrees, in which operational efficiency has the strongest influence 2.5 General evaluation of the current situation of TRM at Bank for Investment and Development of Vietnam 2.5.1 Successes - The process of TRM at BIDV has achieved successes in such matters as: BIDV has been very methodical and professional in TRM planning, especially task such as building regulations, requirements and guiding documents on TRM, developing TRM programs, identifying TRM fund; Implementing TRM: The implementation apparatus is organized in a methodical manner with decentralization and division of tasks according to components in TRM structure; Training for human resources to implement TRM is valued and has had positive results; Internal communication channels and methods are diverse; TRM programs are also implemented as planned and flexible according to the actual situation; The evaluation of TRM has also taken specific steps to reflect the results achieved and the costs spent in the process of TRM at BIDV - The structure of TRM at BIDV has had major changes in the period of 2016-2020 and has brought certain successes The implementation of financial and non-financial parts at BIDV has basically been more stable and professional, creating transparency and bringing satisfaction to worketes as well as improving business efficiency for BIDV 2.5.2 Limitations - TRM process at BIDV + TRM planning: Goals of TRM have not been clearly documented in association with quantitative and qualitative standards; The process of converting, developing and replacing new regulations and requirements often involves many stages and takes a long time; The guiding documents are sometimes not close to reality, issues arise may even beyond the contents of the guiding documents; Identifying funds for voluntary benefit programs and programs for non-financial parts is often quite passive and the process of applying for funding is also time-consuming, leading to delays in implementation 19 + Implementation of TRM: The organizational structure and assignment of tasks of staffs in charge of TRM are still overlapping, plus the level of specialization is not high; Internal communication at BIDV is still mainly in the top-down direction, the feedback from the bottom up is handled quite slowly; The training organization is still limited as there is no object classification and suitable training method selection; Methods of implementing TRM programs also have many limitations + Evaluation of TRM: The evaluation of TRM is only a formality through year-end reports The development of TRM evaluation criteria is still incomplete, unclear and has not been issued in the form of specific documents; The system of quantitative and qualitative indicators has not been proactively promulgated yet to evaluate TRM and has not been regularly assessed on a regular basis; The adjustment and improvement of TRM has not been really drastic when recognizing the existing limitations - The structure of TRM at BIDV + Non-financial parts have not been mentioned by BIDV as a "payment" for employees, leading to low competitiveness of TRM tools + The proportion of parts in the total is still unbalanced and has not created motivation as well as brought high satisfaction to workers, especially for the variable wages + In addition, financial and non-financial parts also have issues such as: (i) Regarding financial parts: The fixed wages by job position are lower than other banks of the same level, so it is easy to lose employees with quality; The variable wages have not really promoted its motivational effectiveness; The form of bonuses is quite monotonous, the bonus level is not high; Voluntary benefits should also be more diverse for each target group to ensure the standard of living and improve the morale of workers (ii) Regarding non-financial parts: The work environment has not been well-assessed; Training and fostering should be further improved; Career advancement still has many shortcomings 2.5.3 Causes of the limitations Firstly: BIDV's operational efficiency is not commensurate with its potential Secondly: The competencies of TRM team are still lacking in terms of quantity and quality, which has not met the requirements Next: The connection of TRM with human resource management activities is very loose, which leads to a lack of consistency and synchronization of TRM policies with other human resource policies In addition, the State's regulations on TRM still have barriers for TRM at BIDV in particular and at enterprises in general Moreover, the regulations and management mechanism of the State Bank are interfering with BIDV's activities, including TRM activities Finally, organizational culture at BIDV has not really created a catalyst to increase the effectiveness of TRM 20 CHAPTER SOLUTIONS TO COMPLETE TRM AT BANK FOR INVESTMENT AND DEVELOPMENT OF VIETNAM 3.1 Development strategy of BIDV in the period of 2020-2025 and vision to 2030 Developing policies to attract, use and reward talents, improving the quality of human resources, developing staffs with both professional competence and ethic and ensuring the interests of employees; ensuring social security; promoting BIDV's brand and culture 3.2 Proposing perspectives to enhance TRM at BIDV Firstly, improving TRM to become an effective tool to compete for human resources Secondly, improving TRM in the direction of ensuring comprehensiveness and focus Next, the enhancement of TRM must be in line with strategic goals In additional, the improvement of TRM must be associated with the formation and development of organizational culture, which promotes active motivation of employees Finally, the improvement of TRM must ensure fairness and accuracy for all employees 3.3 Solutions for TRM improvement at BIDV 3.3.1 Completing TRM planning at BIDV - TRM planning must be associated with specific goals in each period In order to be able to determine TRM’s goals, it is necessary to analyze the internal and external environment in combination with the bases and principles from which to synthesize the goals for each period - Developing requirements on wage payment based on capacity In order to be able to develop a wage-based requirements, BIDV needs to carry out the following activities: Developing a detailed description of each level for each capacity; Determining the competency framework for each job position and establishing the capacity framework of the whole system; Identifying indicators and measurement method for capacity; Identifying the wage calculation formula based on the results of the capacity assessment - Promulgating regulations on allocation of task completion ratings BIDV needs to develop specific regulations and detailed instructions on the evaluation of the level of job completion according to the rating ratio i.e., excellent, good, completed, not completed - Adjusting the structure of TRM fund To ensure efficiency, rationality and motivation for employees PhD student proposes to restructure the financial parts in the following directions: Dividing the financial fund into items: fixed wage fund, variable wage fund, bonus and benefits fund; Increasing the rate for the variable wage fund and decreasing the rate for the fixed wage fund and keep the ratio of the bonus and benefits fund the same 3.3.2 Completing TRM implementation at BIDV - Strengthening and professionalizing TRM apparatus Strengthening the entire TRM apparatus according to the online function to ensure the consistency of the vertical ranks and cover all TRM activities in terms of wage payment, benefits payment, payment of other non-financial values, implementing communication activities on TRM and training for TRM implementation team - Increasing internal communication on TRM implementation 21 The internal communication at BIDV needs to be built in the direction of strengthening the feedback channel of employees to listen to the questions and constructive contributions of employees In addition, it is necessary to set up the communication cycle based on the built content - Improving the quality of human resource training to implement TRM The organization and implementation of human resource training to implement TRM has a great influence on the implementation of TRM When organizing the training, it is necessary to be flexible in the use of training forms and methods to ensure the appropriateness and effectiveness for each training object and training content - Developing standard procedures for performance appraisal Developing a standard performance appraisal process as an accurate basis for variable wage, training, fostering, promotion and rotation 3.3.3 Completing TRM evaluation at BIDV - Establishing measurement standards for TRM outcomes The measurement of TRM outcomes is shown in both qualitative and quantitative standards In which, the qualitative standard is are those that are not presented in the form of data, and quantitative standards are measurable data when evaluating the outcomes of TRM - Actively measuring the main outcomes of TRM Outcome’s measurement and evaluation of TRM needs to ensure the accuracy, scientifically, practicality and systematically BIDV needs to actively measure and evaluate the results of TRM every months/6 months/ year to grasp the current situation and effectiveness of TRM to accurately evaluate the shortcomings, limitations to find the causes and adjust it in a timely manner - Drastically making timely adjustments to TRM when identifying limitations The identification of errors, shortcomings or non-conformity in the process of TRM should be promptly adjusted 3.4 Solutions to complete TRM structure at BIDV 3.4.1 Completing financial parts at BIDV Firstly, restructuring financial parts to create motivation for productivity and work efficiency increasement In particular, changing the proportion of fixed wage and variable wage based on each employee group (direct employee and indirect employee) Secondly, changing the calculation method of variable wages Thirdly, strengthening benefit programs towards comprehensive care for employees 3.4.2 Completing non-financial parts at BIDV Firstly, expanding TRM structure and documenting non-financial parts in regulations on TRM Secondly, creating a working environment of sharing, friendliness, cooperation and mutual development Next, enhancing training and fostering activities by building a learning culture throughout the system Finally, adjusting the career advancement process to ensure fairness, nondiscrimination and no priority subjects 22 3.5 Improving internal factors to facilitate TRM completion at BIDV 3.5.1 Improving operational efficiency to create a stable financial ground for TRM Firstly, regularly evaluating the context and result of the activity through different channels such as revenue, profit, stock price, productivity, profitability of employees to have an accurate view on the current situation of the business operation and employment Secondly, in order to increase ROA and ROE, BIDV needs to focus on customer deposits and outstanding loans because these determinators of bank's profit Next, reducing bad debt and be drastic in resolving bad debt Finally, strengthening the application of information technology and scientific achievements in business activities In addition, BIDV also needs to review all human resources in the system, accurately assess the "excess" and "lack" points to take remedial measures as well as train and foster to create an elite workforce to meet the requirements of the job and the times 3.5.2 Strengthening the human resources and increasing competencies of staffs in charge of TRM at BIDV Firstly, raising awareness of the staff in charge of TRM about their responsibilities and roles in the assigned work as well as for employees and the entire BIDV system Secondly, organizing training and fostering courses for staff in charge of TRM following specific roadmaps and programs Next, TRM team should guide and instruct each other and regularly support and coordinate with each other in their work to ensure the consistency and smoothness of TRM process Moreover, regularly evaluating the capacity of the staff in charge of TRM to accurately recognizing the current situation, limitations and deficiencies in order to take remedial and supplementary measures Finally, recruiting employees with professional qualifications in human resource management to strengthen the force in charge of TRM 3.5.3 Increasing the connection between human resource strategy and TRM - Close connection between the planning and TRM in identifying the planned target audience for the job positions with different wage levels - Close connection between recruitment system with TRM to attract employees and enhance the recruitment brand of BIDV - Close connection between human resource training and TRM in order to develop training and fostering programs for employees - Close connection between the performance management with TRM to accurately assess the results and thereby proposing ways to enhance the performance of employees 3.5.4 Establishing and developing organizational culture to create an environment and a catalyst for effective TRM Firstly, valuing the work-oriented culture by establishing TRM policies based on the job position through the assessment of the value of each position; accurately measuring job performance 23 Secondly, employees at BIDV very appreciate co-worker relationships Thus, the bank needs to build and develop an open-minded culture to help employees be open, friendly and willing to share and help each other in both work and life Thirdly, developing and issuing the "BIDV Cultural Handbook" for all employees to form the culture of BIDV - BIDV'ers 3.6 Proposals to the National Assembly, the Government and the State Bank in improving the regulations related to TRM 3.6.1 Regarding the National Assembly and the Government To begin with, it is necessary to consider reforming wage policy as an important task in national construction and stability Next, it is necessary to improve the minimum wage policy and soon complete and introduce the Minimum Wage Law Moreover, it is a must to promulgate principles to manage the enterprise's payroll scale, but it is not necessary to delve into the profession and techniques of building the scale of the enterprise In addition, it is necessary to quickly create a full legal framework for banking activities, banking administration activities and human resource management activities 3.6.2 Regarding the State Bank Firstly, the State Bank needs to develop documents regulating and guiding human resource management activities in general and TRM in particular for the banking sector in order to create a basis for TRM Secondly, the State Bank needs to plan a general development strategy for the commercial banking system Thirdly, the State Bank needs to research, develop and issue professional competency standards Next, the State Bank should develop and issue a model of professional ethics for employees in the banking industry Finally, the State Bank needs to organize seminars or courses for leaders, managers and relevant departments in the banking system 24 CONCLUSION Based on qualitative and quantitative research methods suitable for primary and secondary databases collected, the thesis has accomplished the research goals and missions and answered the research questions as follows: (i) Systematizing and creating a basic theoretical framework on the process of TRM from planning, implementation to evaluation of TRM; Researching and interpreting the structure of TRM; Developing a model of factors influencing TRM process including independent variables: operational efficiency, competencies of TRM team, human resource strategy, legal regulations on TRM and organizational culture (ii) Analyzing and evaluating the process of TRM at BIDV from planning, implementation to evaluation of TRM; Evaluating the current situation of TRM structure at BIDV through financial and non-financial parts; Using SEM model, Bootstrap test to test the influence of operational efficiency, competencies of TRM team, human resource strategy, legal regulations on TRM, organizational culture on the process of TRM In which, operational efficiency has the strongest influence on the TRM process at BIDV; Indicating the successes and limitations of TRM at BIDV Figuring out the reasons for the successes and limitations of TRM at BIDV in recent years (iii) Studying BIDV's development strategy; Proposing perspectives to enhance TRM at BIDV; Proposing scientifically-based solutions to improve TRM at BIDV to 2025, vision to 2030: Solutions to improve TRM process; Solution to complete TRM structure; Improving internal factors to facilitate the completion of TRM BIDV; Proposing recommendations to the National Assembly, the Government and the State Bank in improving the regulations related to TRM Along with that, the thesis has some limitations including the selected survey sample is a convenient sample with the percentage of 653 votes collected, accounting for nearly 25% of BIDV's total employees (26,752 people), thus it did not cover all of the employees at BIDV, which may lead to a somewhat high accuracy of the conclusion of the study In addition, due to limited qualifications and skills in using software and scientific research methods, errors in research, evaluation and analysis will inevitably be made The student is looking forward to receiving valuable comments from teachers, scientists, colleagues and friends so that the PhD student can complete the thesis and develop further studies in the future My sincerely appreciation./ ... perspectives and in Vietnam, Vietnam Trade and Industry Review, No.2 – 2/2018 Pham Thi Thanh Ha (2019), The research model on the labor remuneration at Vietnamese commercial banks, Vietnam Trade and Industry... revolution 4.0” Pham Thi Thanh Ha (2020), The structure of labor remuneration at Vietnam’s commercial banks, Vietnam Trade and Industry Review, No.4 – 3/2020 Pham Thi Thanh Ha (2020), Human resource... Development of Vietnam (BIDV) was founded on April 26 1957 with the name the Bank for Construction of Vietnam After 64 years of establishment and development, BIDV has undergone changes of names and management