FACTORS AFFECTING MANUFACTURING EMPLOYEE PERFORMANCE AT SAMSUNG ELECTRONICS VIETNAM

Recently, almost of comapanys are fully understanded of the importance of employee performance, especially in the field of smartphone manufacturing. Improving employee performance or to find out the methods through which high level of employee performance can be achieved is becoming one of the decisive factors for any company success. This research aimed to identify and measure the level of factors affecting the manufacturing employee performance working at SEV, through identifying the variables include leadership, organizational culture, working environment, motivation, training & development. In the thesis, the author has used theory of Khan and Jabbar (2013); Mathis & Jackson (2009) as the basis component framework to measure the employee performance at SEV. These 05 factors are measured by 20 obseved variables. Manufacturing employee performance is a depedent variable which mesured by 04 observed variables .This study is qualitative and quantitative in nature and aimed to find out the relationship between above mentioned variables and manufacturing employee performance in SEV. For this purposes data was collected from SEV with the research sample consisted of 350 manufacturing employees are working in main assembly factory at SEV. However, in the fact that, it is 326 of the manufacturing employee participated in the survey, acounts for 93.14%. Questionnaires were collected by company email system. Survey results were processed by SPSS software. The mean of the manufacturing employee performance is 3.4 that mean employee performance was average good level. Manufacturing employee have not achieved maximum performance. The most inportance factors that affecting manufacturing employee performance is Working Environment (Beta=0.319, contributes 25.2 %), second by Leadership (Beta=0.313, contributes 24.72 %), and Motivation (Beta=0.248, contributes 19.59 %). The problems in enhancing the manufacturing employee at SEV are found as below:   - First, the employees think that there is a difference in their income between shiftwork and group work while the base salary is the same. Employees work in groups have higher income and working time is 4 days/week. Many employees want to work in groups instead of working shifts. In fact, 31% of employees are satisfied with total income (salary, benefits and other bonuses) and 38% “Neutral” while 32% of employees are dissatisfied with total income. - Second, promotion policy doesn’t have a clear for individual manufacturing employee. Manufacturing employee is only promoted by job level and is rarely appointed to direct management positions such as Sub / Line Leader. Ratings and rewards are often awarded representing the whole production line or team. Individual awards are limited. Only 33% of the employee while 37% didn’t satisfy with promotion opportunities and rewarding. Thirth, the mean of “You are satisfied with the support of leaders and colleagues at work (WE5)” is only 3.01 which means that the employee didn’t satisfy with the support of leaders and colleagues at work. In fact, 30% of the employee satisfied, 48% neutral while 28% didn’t satisfy (20% Disagree and 8% Strongly Disagree). Finally, the mean of "Leaders usually trust and encourages the members decide on work methods (LS2)" is 3.22. This is normal level which means that employees need to get more trust from Leaders and employees need more encourage at work. The researcher gave some solutions to improve the manufacturing employee performance as follow: - Improving promotion & reward motivation: the company should build clear criteria for promotion for manufacturing employee and career level. - Improving the support of leaders and colleagues at work: Enhancing coaching job skill, enhance discussion, work communication and building trust. In addition, SEV also arranges employee rotation to suit their capacity and job requirements. Rearcher hoped that manufacturing employee performanace is improved and help to enhance company performance and the company can develop sustainably.

NATIONAL ECONOMICS UNIVERSITY

NEU BUSINESS SCHOOL

NGUYEN VAN TUYEN

FACTORS AFFECTING MANUFACTURING EMPLOYEE PERFORMANCE AT SAMSUNG

ELECTRONICS VIETNAM

MASTER OF BUSINESS ADMINISTRATION THESIS

HANOI – 2020

NATIONAL ECONOMICS UNIVERSITY

NEU BUSINESS SCHOOL

NGUYEN VAN TUYEN

FACTORS AFFECTING MANUFACTURING EMPLOYEE PERFORMANCE AT SAMSUNG

ELECTRONICS VIETNAM

MASTER OF BUSINESS ADMINISTRATION THESIS

SUPERVISOR: ASSOC PROF DR VU THI MINH

HANOI – 2020

Second, I send my sincere thanks to managers and colleagues at SamsungElectronics Vietnam for catering me in collecting full and accurate data in researchprocess.

Finally, I also would like to thank my family and friends for their support infinishing this thesis

Thank you very much

Nguyen Van Tuyen

Nov 2020

TABLE OF CONTENTS

SEV: Samsung Electronics VietnamSEC: Samsung Electronics CompanyHRM: Human Resource ManagementEFA: Exploration Factor AnalysisKPI: Key Performance IndicatorMBO: Management by Objectives

LIST OF TABLES

LIST OF FIGURES

Figure 1.1: Research process 16

Figure 2.1: Research Model of the factors affecting manufacturing employee performance at SEV 28

Figure 3.1: Samsung Electronics Vietnam Organizational Chart 33

Figure 3.2: Age group 34

Figure 3.3: Gender structure 34

Figure 3.4: Marital status 34

Figure 3.5: Workmanship level 35

Figure 3.6: Working time 35

Figure 3.7: Job position 36

Figure 3.8: Manufacturing employee’s performance evaluation result 38

Figure 3.9: Manufacturing employee’s opinion about Working Space 50

Figure 3.10: Manufacturing employee’s opinion about Infrastructure 50

Figure 3.11: Manufacturing employee’s opinion about working tools safety 50

Figure 3.12: Manufacturing employee’s opinion about interpersonal relationship .51 Figure 3.13: Manufacturing employee’s opinion about work interaction 51

Figure 3.14: Manufacturing employee’s opinion about Coaching 53

Figure 3.15: Manufacturing employee’s opinion about Empowerment 53

Figure 3.16: Manufacturing employee’s opinion about Participation 53

Figure 3.17: Manufacturing employee’s opinion about the Salary 56

Figure 3.18: Manufacturing employee’s opinion about the total Promotion 57

Figure 3.19: Manufacturing employee’s opinion about the Reward 57

Figure 3.20: Manufacturing employee’s opinion about the Profit sharing 58

Figure 3.21: Manufacturing employee’s opinion about the Job enrichment 58

Figure 3.22: Manufacturing employee’s opinion about the Recognition 58

Figure 3.23: Manufacturing employee’s opinion about promotion opportunities 60

Figure 3.24: Manufacturing employee’s opinion about Creative & Innovation 60

Figure 3.25: Manufacturing employee’s opinion about employee orientation 61Figure 3.26: Manufacturing employee’s opinion about Training Need Assessment 62Figure 3.27: Manufacturing employee’s opinion about Training program & Method 64Figure 3.28: Manufacturing employee’s opinion about On Job Training 64

EXECUTIVE SUMMARY

Recently, almost of comapanys are fully understanded of the importance ofemployee performance, especially in the field of smartphone manufacturing.Improving employee performance or to find out the methods through which highlevel of employee performance can be achieved is becoming one of the decisivefactors for any company success

This research aimed to identify and measure the level of factors affecting themanufacturing employee performance working at SEV, through identifying thevariables include leadership, organizational culture, working environment,motivation, training & development In the thesis, the author has used theory ofKhan and Jabbar (2013); Mathis & Jackson (2009) as the basis componentframework to measure the employee performance at SEV These 05 factors aremeasured by 20 obseved variables Manufacturing employee performance is adepedent variable which mesured by 04 observed variables This study is qualitativeand quantitative in nature and aimed to find out the relationship between abovementioned variables and manufacturing employee performance in SEV

For this purposes data was collected from SEV with the research sampleconsisted of 350 manufacturing employees are working in main assembly factory atSEV However, in the fact that, it is 326 of the manufacturing employee participated

in the survey, acounts for 93.14% Questionnaires were collected by company emailsystem Survey results were processed by SPSS software

The mean of the manufacturing employee performance is 3.4 that meanemployee performance was average good level Manufacturing employee have notachieved maximum performance The most inportance factors that affectingmanufacturing employee performance is Working Environment (Beta=0.319,contributes 25.2 %), second by Leadership (Beta=0.313, contributes 24.72 %), andMotivation (Beta=0.248, contributes 19.59 %) The problems in enhancing themanufacturing employee at SEV are found as below:

- First, the employees think that there is a difference in their income betweenshiftwork and group work while the base salary is the same Employees work ingroups have higher income and working time is 4 days/week Many employeeswant to work in groups instead of working shifts In fact, 31% of employees aresatisfied with total income (salary, benefits and other bonuses) and 38% “Neutral”while 32% of employees are dissatisfied with total income.

- Second, promotion policy doesn’t have a clear for individual manufacturingemployee Manufacturing employee is only promoted by job level and is rarelyappointed to direct management positions such as Sub / Line Leader Ratings andrewards are often awarded representing the whole production line or team.Individual awards are limited Only 33% of the employee while 37% didn’t satisfywith promotion opportunities and rewarding

Thirth, the mean of “You are satisfied with the support of leaders and colleagues

at work (WE5)” is only 3.01 which means that the employee didn’t satisfy with thesupport of leaders and colleagues at work In fact, 30% of the employee satisfied, 48%neutral while 28% didn’t satisfy (20% Disagree and 8% Strongly Disagree)

Finally, the mean of "Leaders usually trust and encourages the membersdecide on work methods (LS2)" is 3.22 This is normal level which means thatemployees need to get more trust from Leaders and employees need moreencourage at work The researcher gave some solutions to improve themanufacturing employee performance as follow:

- Improving promotion & reward motivation: the company should build clearcriteria for promotion for manufacturing employee and career level

- Improving the support of leaders and colleagues at work: Enhancingcoaching job skill, enhance discussion, work communication and building trust Inaddition, SEV also arranges employee rotation to suit their capacity and jobrequirements

Rearcher hoped that manufacturing employee performanace is improved andhelp to enhance company performance and the company can develop sustainably

CHAPTER 1: INTRODUCTION

1.1 Rationale

Employees are the human capital of organizations and their performance is akey indicator for organization to achieve its goals Recently, most of organizationsare fully aware of the importance of employee performance, increasing employeeperformance is becoming one of the decisive factors for any organization success.Therefore, it is very important to have capable employees who can account on them

to create competitive advantage

Samsung Electronics Co., Ltd (SEC) is the subsidiary of South Korea'sSamsung Group and the largest electronics producer in Asia Samsung Electronicsoperates four main divisions including Digital Media, Semiconductors, Information

& Communications, and Home Appliances In mobile division, SamsungElectronics Company (SEC) has 9 mobile phone factories globally Include twofactories in Vietnam are SEV (Bac Ninh) and SEVT (Thai Nguyen) Currently,these are the two largest and most modern Samsung Electronics mobile phonecomponents and assembling factories in the world

Samsung Electronics Vietnam Co., Ltd (SEV) in Yen Phong I IndustrialPark, Yen Trung commune, Yen Phong district, Bac Ninh province was grantedinvestment license on March 25, 2008 The total investment capital is 2.5 billionUSD Currently, SEV has about 28,000 employees for manufacturing mobile phonecomponents for domestic assembly as well as exports to other factories

Samsung's mobile phone business is currently facing fierce competition fromsmartphone manufacturers such as Apple, Huawei, Vivo, Oppo, Xiaomi, etc Themobile market is gradually becoming saturated This requires manufacturers toconstantly refresh themselves before being eliminated

Vietnam is one of key markets for Samsung Electronics In addition to thecompetition in the phone market, the competition for human resources is alsoextremely difficult Samsung Electronics Vietnam has to come under increasingpressure to improve their performance because the local labor force does not have

much working skills, skill level as well as disagreements in Korean and Vietnameselanguages The value of factory performance audit in 02 recent years revealed anumber of weaknesses in performance management of production workers.

Performance disparities between production lines strong impact on productoutput management and factory performance Manufacturing employee alsocomplained about the management practices of some sub/line leaders

The factory performance is only ranked 05th out of 09 Samsungmanufacturing mobile factory globally Organizational performance refers toemployee performance Samsung Electronics Vietnam (SEV) is also has to competeperformance with other Samsung mobile phone factories globally The problem ofcoporation management is how to manage high employee performance to achievehigh organizational performance Management is responsible in carrying out thetask of managing the company in the right way

With the aim of developing Samsung Electronis Vietnam to become one ofthe best performing companies in mobile phone factories, as well as become thecompany with the best working environment in Vietnam, the board of management

is determined to improve the performmance of employees To achieve this, it isnecessary to find out factors that affect employee performance and provideappropriate measures to help employees achieve the best performance

There have a lot of researches done into the factors that affect employeeperformance made by various scholars, many factors have been considered Fromthe results of these researches, factors have a different affecting in organizationsbecause of the differences in the form and characteristics of each company Forexample, an employee who works at a manufacturing factory is different from astore saleman or a service employee Currently, there are very few researches aboutworkforce at electronics factories in Vietnam in general and there is no researchabout on factors affecting employee performance at Samsung Electronis Vietnam inparticular Therefore, as a Human Resources staff member at Samsung ElectronicsVietnam in order to help management find out factors affecting performance andmethods to innovation factors to achieve performance highest, Author chooses the

research topic: “Factors affecting manufacturing employee performance at

Samsung Electronics Vietnam”.

1.2 Research objectives

1.2.1 General objective of the study

This study aims to identify the main factors that positive / negative affectingemployee performance Base on that, proposal suitable solutions to improvemanufacturing employee performance of the company

1.2.2 Specific objectives of the study

- To identify a theoretical framework of factors affecting performance for SEV'smanufacturing employees

at SEV

factor on manufacturing employee performance at SEV to find out positive /negative affecting

SEV in the coming years

1.3 Research questions

performance at SEV?

SEV? What are level positive / negative affecting of its?

1.4 Research approach and methodology

H1= Relationships between Leadership and Employee’s Performance

H2= Effect of Organizational Culture on Employee’s Performance

H3= Relationships between Working Environment and Employee’s

H4= Effect of Motivation on Employee’s Performance

H5= Relationships between Training & Development and Employees’Performance

1.4.1.1 Relationships between Leadership and Employee’s Performance

H1: There is a positive relationship between leadership and employees’performance

This study is about the leadership attitude that affects employee performance

If the leaders coach, empower or enhance the employees’ participation to the job,the employees are willing to work energetically The performance of the employees

is raised positively if the control and attitude of leaders are interactive andpromoting, then the employees work in a betterment of the organization If themanager is unbiased towards employees, these organizations progress more thanothers It is necessary that manager is unbiased and treats every employee withoutdiscrimination

1.4.1.2 The effect of Organizational Culture on Employee’s Performance

H2: There is a positive relationship between the organizational culture andemployees’ performance

According to this study, the organizational culture has influences onupgrading the employees’ performance If the environment is pleasant andcomfortable to work, the employees are encouraged and motivated to workeffectively and efficiently The good and competitive organization culture enhancesthe performance of the work force The organizational culture that the employeecanfeel “like home” will support them to work dedicatedly The members of theorganizations are encouraged to work effectively if the organizational cultureencourages to working effectively, is strong and motivating Organizational culture

is a reflection of employees’ performance It is directly proportional to theemployees’ performance

1.4.1.3 Relationships between Working Environment and Employee’s Performance

H3: There is a positive relationship between the working environment and

employees’ performance.

The working environment (including physicaland behavioral components)depending on the administrative, management, individuals and interaction patternsbetween their philosophy It is a set of characteristics that distinguish theorganization from others and the characteristics of the organization’s internalenvironment results from the interaction outcome of goals, regulations, rules,procedures and policies that are applied in the organization and well known by theemployees in the organization More over directly and indirectly affects theindividual behavior and performance at work eventually leads to achieve the goals

of the organization

1.4.1.4 The effect of Motivation on Employee’s Performance

H4: There is a positive relationship between motivation and employees’performance

It is very important to motivate employees for increasing their performance

In an organization where employees are valued for their knowledge, qualificationand skills, the best employee motivation efforts focus on what employees deem to

be important Employee motivation become a crucial factor to increase employees’longevity, productivity, better moral, better performance and create betterorganization performance Pay, rewards, profit sharing, promotion, recognition, jobenrichment, decisionalparticipation, authority, health insurance etc… All thesefactors can motivate employees’ and increase their performance

1.4.1.5 Relationships between Training and Employees’ Performance

H5: There is a positive relationship between training and employees’performance

There is a strong relationship between training and employee performance

As the means of training is giving new or current employees the skills they need toperform at their various jobs (Dessler, 2008) or to help them acquire competencies forthe job completion, in correlations of employees’ performance, training will increaseemployees’ ability to perform on the job in a better way In addition, training is

Identify Problem, Objectives Select theotical Framework Build scales of manufacturing employee’s

performance

Build scales of manufacturing employee’s

performance

Adjust the scales of manufacturing

employee's performance

Adjust the scales of manufacturing

Analyze current manufacturing employee’s performance at SEV and main affecting factors

Analyze current manufacturing employee’s performance at SEV and main affecting factors

Some solutions to improve manufacturing employee’s performance at SEV

supposed to be a non-financial motivator to reward employees for their goodperformance

1.4.2 Research methodology

1.4.2.1 Reseacher process

The research conducts with the following process

(Source: author design)

Figure 1.1: Research process

1.4.3 Data collection

The data is collected from two sources: secondary data and primary data

Secondary data is collected from:

Primary data is collected by:

+ Questionnaire:

The population for this study comprised all manufacturing employee in main

assembling area with the population are approximately 350 Accordingly, there are

350 questionnaires are delivered in paper and online survey method There are 326manufacturing employee participated in the survey for a perticipation rate 93.14 %

Survey questionnaire contains the following two sections:

- Section 1: Respondents are requested to give general information (age, gender…)

- Section 2: The questions are designed to be clear and easy to understand Thequestionnaires include items to measure the different variables of the researchmodel to study the impact of leadership, organizational culture, workingenvironment, motivation and training & development on employee performance

The respondents are expected to provide necessary information according tothe designed questionnaire consisted of the followings matters:

I Leadership (including 03 sub-items)

II Organizational culture (including 03 sub-items)

III Working environment (including 05 sub-items)

IV Training & Development (including 03 sub-items)

V Motivation (including 06 sub-items)

VI Performance (including 04 sub-items)

The questionnaire is included a total of 24 questions and was designed onLikert Scale type from 1 to 5 such as strongly disagree, disagree, neutral, agree, andstrongly agree Respondents answer the givenquestions by marking the correct andsuitable choice The questionnaire is in bilingual (English and Vietnamese) for thebest comprehension and interpretation Furthermore, respondents need tosupplement other related information including gender, age group, level ofeducation and job position

+ From observation: The author has been working for SEV more than 5

years Thus, I have witnessed its development and changing I have chance to workwith manufacturing employees and understand about working’s quality andeffectiveness

+ In-dept interview: Carried out in-depth interview with 20 peoples.

1.5 Research scope

This research focuses on the five factors affecting on manufacturingemployee performance at Samsung Electronics Vietnam:

1.6 Thesis Structure outline

The thesis includes 04 chapters:

Chapter 1: IntroductionChapter 2: Theoretical background on manufacturing employee’sperformance

Chapter 3: Current manufacturing employee’s performance at SEVChapter 4: Some solutions for SEV to enhancing manufacturing employee’sperformance at SEV

CHAPTER 2: THEORETICAL BACKGROUND ON MANUFACTURING EMPLOYEE PERFORMANCE

2.1 Definition of Employee Performance

Performance can be defined very simply as behaviors that lead to results orpurposeful work Sonnentag.et al (2008) said that employee performance as theoutcome aspect in turn refers to the result of the individual’s behavior.

Khan and Jabbar (2013) defined employee performance means employeeproductivity and efficiency as a result of employee growth It means the specificoutcomes a person wants to achieve in his job and because the organization wants toachieve that outcome

Aguinis (2009) described that “the definition of performance does not onlyinclude the results of an employee’s behavior, but all behaviors themselves.Performance is about behavior or what employees do, not only is about whatemployees produce or the outcomes of their work” Perceived employeeperformance represents the general belief of the employee about his behavior andcontributions in the success of organization

Mathis & Jackson (2009) employee performance assesses whether a personperforms a job well It is affected by different factors at workplace Employeeperformance indicates the effectiveness of employee’s specific actions thatcontribute to attaining organizational goals Performance is associated with quantity

of output, quality of output, the timeliness of output, presence / attendance on thejob, efficiency of the work completed and effectiveness of work completed”

In summary, this thesis uses the definition by Khan and Jabbar (2013);

Mathis & Jackson (2009) This definition has four key indicators reflect of

performance: employee productivity, efficiency, effectiveness, and timeliness

The productivity element is a measure of intensity, behavior, andcontributions The effectiveness of employee’s specific actions that contribute toattaining organizational goals

2.2 The importance of improving manufacturing employee performance in

manufacturing operation

- Employees are the human capital of organizations and their performance is

a key indicator for organization to achieve its goals Employee performance is one

of the most important constructs in both organizational psychology and human

resource management (Campbell, McHenry, & Wise, 1990).

- Employees usually represent the largest expense for a company, andmeasuring performance is essential to the employee management process

- Improving manufacturing employee performance help to enhance thecompetitive advantage and therefore the organization’s performance increase

- Good manufacturing employee performance helps to lowers employeeexpense

- According to Collis and Montgomery (1995) employees play an importantrole in organizational success Employees’ performance has a positive relationshipwith organization performance

- Manufacturing employee performance shows that job satisfaction

- Manufacturing employee performance can also relate to how efficiently acompany uses economic resources Economic resources include the direct materialsand facilities needed to produce products Poor manufacturing employeeperformance can result in wasted resources and higher business operating costs

- Manufacturing employee performance also impacts company culture Ifyour employees are engaged, punctual, managed fairly and willing to takeresponsibility that creates a culture of respect and trust That leads to employeesstaying with your business longer

That means a good performance workforce means a highly productive staff,all of which will help you achieve your business goals

2.3 The nature of employees in manufacturing operation

Employees in manufacturing factory are responsible for mass production of aspecific product in a manufacturing or production facility Depending on theposition and company, a production worker's duties may vary from office, operatingmachinery, assembling materials or equipment, carrying out inspections and qualitycontrol or include a managerial or supervisory role

In mobile phone manufacturing, desirable skills include being reliable,individual skill and diligent with the ability to work efficiently while maintaining

high standards in quality at all times Due to the nature of the work, productionemployees must be able to stand or sitfor long hours at a time, perform repetitivetasks with minimal supervision A flexibles work schedule with the ability to workshifts, overtime and weekend.

2.4 Factors affecting employee performance theories

There have been a lot of researches done on employee performance by manyscholars, many factors affecting employee performance were considered It is clearthat no standard factor is applicable to all organizations because of individualdifferences Most of researches explored employee performance in the foreigncountries In Vietnam, most of employee performance researches focused on otherindustries such as services, sale, bank, and government agencies Until present,knowledge about employee performace of hight technology manufacturing inVietnam is still limited These research findings about employee performance inother countries, other industries and other organizations are not sure to be valid forthe mobile phone manufacturing of Samsung Electronics Vietnam because of thedifference between industries, organizations and individual differences So, thisstudy will be steered mainly certain factors individually and collectively effect onthe performance of employees in a positive or negative way, including:

2.4.1 Leadership

Armstrong & Murlis (2004); Cronje et al (2001) together indicated that theleadership stylewithin an organization has a bearing on encouraging or inhibitingemployee’s performance Northouse (2007) defined that leadership is a processwhereby an individual influences a group of individuals to achieve common goals

In a longitudinal study, Mosadegh & Yarmohammadian (2006) indicated that goodand effective leaders matter to the overall performance and well-being of theorganization and its members In a survey, Keller (2006) discovered that employeeswill give their best if leader have good expectations from them If people feel thatleaders are not appreciating them for their good performance, then they will feel demotivated If a leader is not giving feedback on a good performance, it will create acommunication gap and ultimately the employee will feel overlooked and his

performance will be declining.

2.4.1.1 Coaching

Coaching based Leadership is used to improve employees’ performancesand professional roles (Goldsmith & Lyons, 2006; Moen, 2010; Underhill, et al.,2007) When a coachee is faced with an exploration of the potential forenhancing performances, the coach and the coachee begin with pursuing learninggoals (Gallwey, 2000; Moen & Kvalsund, 2008; Passmore & Gibbes, 2007;Wilson, 2007)

Champathes (2006) identified coaching has become an important technique

to improve performance It is not a oneway communication and proves to be a twoway communications where coaches identify what can be improved and how it can

be improved Jarvis (2014) explains that there is an increasing trend in today’sorganisations in recognizing developmental need of the employees, help in personalproblem solving and planning of activities to be undertaken by the employee.Research has found that employee’s job performance is a function of their abilityband chance to organize their ideas, knowledge and abilities in an effective way Theresults of a survey (Jarvis, 2014) also indicated coaching can help in enhancing anemployee performance as it provides the employee with a chance to increase theirskills and motivation which eventually leads to an overall positive impact on theemployee job performance Further, coaching also addresses the belief andbehaviors that hinder performance (Toit, 2007) Starr (2004) also agreed furtherseen that coaching is all about helping someone else to improve performance

2.4.1.2 Empowerment

Empowerment of leadership has been seen as a distinct type of leaderbehaviour (Arnold et al., 2000), providing support to subordinates throughcoaching, encouragement, training and emotional support, and information(Bandura, 1986) Employees are thus more likely to have a sense of meaning in

basis

The Study of Ronah (2015) concluded that empowerment as a well-knownmanagerial concept, empowerment of employees plays a potential role in promotingorganizational performance Duvall (1999) defines success as achievement,accomplishment and attainment which is consequence of empowerment as follows:(1) Individual success in form of employee’s role performance, (2) Organizationalsuccess which is achieved as members of the organization accomplish collectiveorganizational goals and objectives, and (3) As organizational members share amutually beneficial and satisfying work experience meeting both social andpersonal growth needs Further, empowerment had significant positive correlationswith both performance and satisfaction (Bartram and Casimir, 2007)

According to the research done by Towers Watson in 2010, a majority ofmanager believe that talent retention will be more difficult in next years wherebythey will need a deeper reason to stay in the organization They will need to feelthey are appreciated for their contributions, have the resources to do their jobs to thebest of their abilities, and have clearly defined opportunities to develop and advancewithin the organization In short, they must be empowered beyond being asked tomeet performance goals Empowerment plays significant role in employee’ssatisfaction thus promoting their performance in organizations Empowerment isalso defined as the process of enabling and authorizing individuals to think,behaves, take action and decision and control work autonomously Menon (2001)surveyed 311 employees in a company, he found that the greater the empowermentthe greater was the motivation to work among employees, which led to less job

stress and increased employee commitment to organizational goals.

2.4.1.3 Participation

In 1967, Rensis Likert and his colleagues identified the foundation forleadership theories After more than 30 years of research, the participation is onefactor of leadership styles, which were eventually formulated

Participation is characterised by the leader actively involving team members

in identifying objectives, developing strategy, and decision-making in general

In Chen and Tjosvold research 2006, they defined that participationmanagement is about involving employees in the decision making processwhere the employees feel that they have the opportunity to discuss problemsand can influence organizational decisions The overall impact of participation

is increased employee job performance and low turn- over In addition,organizations can act to increase or decrease the levels of these mediatorvariables within their personals and potentially strengthen the positiveperformance effects of employee participation (Lam et al, 2002) According toCarrel, Kuzmits & Elbert (1989) Employee will be motivated becausemanagement considers them as partners in contributing to organizationalsuccess instead of being seen as mere subordinates and therefore will avoidengaging into counterproductive behaviors hence improved performancethrough timely achievement of organizational goals and objectives

of employees and profitability

Daft (1984) dicovered that a strong organizational culture supportsadaptation and develops organization’s employee performance by motivatingemployees toward a shared goal; and finally shaping and channeling employees’behavior to that specific direction should be at the top of operational and functionalstrategies Schein (1994) clarifies that value which is a set of social norms thatdefine the rules or framework for social interaction and communication behaviors

of society’s members, is a reflection of causal culture assumptions Peters andWaterman (1982) and practitioners argue that the performance of an organization isdependent on the degree to which the values of the culture are widely shared.Similarly, Ogbonna (1993) widely argued that shared and strongly held valuesenable management to predict employee reactions to certain strategic options and

by reducing these values, the consequences maybe undesirable

2.4.3 Working Environment

Janssen, O & NW Van Yperen (2004) identified the influence degree ofworking environment is the counterpart requirement of a creative job Higher jobsatisfaction and lower intentions to leave were found for those individuals whosework environment accompanied the creative requirements of jobs The workplaceatmosphere includes both physical and psychological factors due to whichperformance enhance The environment plays an important role to enhanceperformance It also increases the job satisfaction According to Brenner (2004) toensure more output the infrastructure is well planned with worker contentment.Opperman (2002) argued that infrastructure is the combination of three importantatmospheres that is managerial atmosphere, scientific atmosphere and individualatmosphere Scientific atmosphere consists of apparatus, utensils and all otherscientific factors So, workers perform their tasks effectively The individualatmosphere consists of subordinates, executives all other staff of the organizations.The individual atmosphere is builds in such a way in which communication level isenhanced between employees to ensure more output Managerial atmosphere

consists of methods, values, standards and events In favorable atmosphere workersshare their pleasant experience that allow them to show their truly attitudes Invenomous atmosphere workers share their unpleasant experience The mostrecognize theory is that when the working environment is suitable the moreemployee shows better result in the organization.

2.4.4 Training & Development

The developing process of employees’ skill in order to improve theperformance is called training (Swanson, 1999) Training is a type of activity which

is planned, systematic and it results in enhanced level of skill, knowledge andcompetency that are necessary to perform work effectively (Gordon, 1992)

According to Belcourt, Wright and Saks (2000) most of managers givetraining to their employees for three main purposes, which are (1) to increaseproductivity or the performance of employees; (2) to achieve organizational goals;and (3) to invest in employees to succeed in the unpredictable and turbulentbusiness environment There are 3 most important types of training: training needsassessment (TNA), training contents and deliveryapproaches, on the job training(OJT) Existing literature presents evidence of an existence of obvious effects oftraining and development on employee performance Wright & Geroy (2001) notesthat employee competencies change through effective training programs Traininghas been proved to generate performance improvement related benefits for theemployee as well as for the organization by positively influencing employeeperformance through the development of employee knowledge, skills, ability,competencies and behavior (Appiah 2010; Harrison 2000; Guest 1997)

2.4.5 Motivation

Jobber (1994) identified motivation is a key determinant of job performanceand a poorly motivated force will be costly in terms of excessive staff turnover,higher expenses, negative morale and increased use of managements’ time.Therefore, management must know what exactly stimulates their staff so resourcesare not misallocated and dissatisfaction develops among employees As Green(2000) has described motivation to be proactive in the sense of; in dealing with

employees who are high performers, motivation is essential, otherwise theirperformance will decline or they will simply leave the job While dealing with lowperformers, motivation is a prerequisite; otherwise these employees will drag resultsdown, lower productivity and certainly would not leave the organization, as theywill have nowhere else to go.

Carlsen (2003) found out that a motivated workforce is essential because thecomplete participation of employees will certainly drive the profitability of theorganization According to Denton (1991), a motivated workforce will lead togreater understanding, acceptance, commitment to implementation, understanding

of objectives and decision making between management and employees Asasserted by Ololube (2006), work motivation, regardless of whether it is intrinsic orextrinsic, is necessary for workers as they feel that they work for a fundamentalreason life

2.5 Theoretical framework selected for the research

In this study, it has been conceptualized that factors such as Leadership,Organizational Culture, Working Environment, Motivation and Training &Development have significant impact on performance level of employees working

in corporate zone I considered Leadership, Organizational Culture, WorkingEnvironment, Motivation and Training & Development as independent variableswith 20 observational variables (1.4.1 Research approach) whereas manufacturingemployee performance as dependent variable Before this no research wasconducted in Samsung Electronics Vietnam with respect to the variables those havebeen selected in this study The intention of this research work is to categorize andfigure out the effect of above-mentioned variables on the performance of employee

in addition to evaluate the level and sphere of influence that they contribute towardheightened or poor performance of employees within an organization

Performance on the other hand is presented as the dependent variable which

is measured in terms of efficiency, effectiveness, productivity and timeliness (Khanand Jabbar (2013); Mathis & Jackson (2009) in 2.1 Definition of Employee

Performance)) is also currently being applied to employees who are production staff

at SEV since its inception

Based on the long-standing development of Samsung and the performancemeasurement criteria for manufacturing employee has been built upon themanufacturing process and approved senior management, applied as a measurement

to measure manufacturing employee working process Therefore, the author usesthese components to measure the dependent variable

Figure 2.1: Research Model of the factors affecting manufacturing employee

performance at SEV

Table 2.1: The scales of manufacturing employee performance

1

Motivation

- The salary I get motivates me to carry out my duties

- I am more motivated to do my job when organization gives promotion

in a fair and transparent way

- My salary is equitable when compared with other company

- You are satisfied with monetary benefits received from my company

- You are satisfied with annual performance bonus

- You felt recognized and appreciated your contribution to the

organization

M

M1M2

M3M4M5M6

2

Working Environment

- You are satisfied with working space in your department

- I am provided with adequate infrastructure working conditions to do

my job effectively

- Safety when doing the job

- Employees have friendly relationship with each other

- You are satisfied with the support of leaders and colleagues at work

WE

WE1WE2

WE3WE4WE5

3

Training & Development

- Training and development is essential for skill and competency level

Organizational culture

- You always get respect, share information and communicate at work

- You are encouraged to be creative and to be rewarded for innovative

6

Performance

- You always completed the job well above expectations

- You always innovates your work by new methods

- You always achieve results in terms of output and timeline

- You always complies working process and stage error control

P

P1P2P3P4 (Source: author design base on SEV’s Documentary)

CHAPTER 3: CURRENT MANUFACTURING EMPLOYEE PERFORMANCE AT SAMSUNG ELECTRONICS VIETNAM

3.1 Overview of Samsung Electronics Vietnam and its characteristic

affecting manufacturing employee’s performance.

3.1.1 General introduction

3.1.1.1 General information

Company name: Samsung Electronics Vietnam

Abbreviated name: SEV

Address: Yen Phong I Industrial Park, Yen Trung commune, Yenphongdistrict, Bacninh province, Vietnam

Website: https://www.samsung.com/vn ; https://news.samsung.com/vn

- Samsung Electronics Co., Ltd is the chief subsidiary of South Korea's

giant Samsung Group and the largest electronics producer in Asia SamsungElectronics was created in 1969 and operates four main divisions including DigitalMedia, Semiconductors, Information & Communications, and Home Appliances.The company sells televisions, video, and audio equipment; computers and relatedproducts; phones, cellular phones, and fax machines; home appliances;semiconductors; network-related products; factory automation products; fiber opticsproducts; closed circuit security products; motors and compressors; and solarenergy systems In 2000, Samsung Electronics held the leading market position inthe code division multiple access (CDMA) Handset, DRAM, SRAM, and colormonitor markets

- Subsidiary Samsung Electronics Vietnam Co., Ltd (SEV) in Yen Phong I

Industrial Park, Yen Trung commune, Yen Phong district, Bac Ninh province wasgranted investment license on March 25, 2008 The total investment capital is 2.5billion USD Currently, SEV has about 28,000 employees for manufacturing mobilephone components for domestic assembly as well as exports to other factories

3.1.1.2 Samsung Electronics History Business from 2007-Present

Table 3.1: Samsung Electronics History Business from 2006-Present

2019 - World's first 75-inch Micro LED launched

- Launch of Samsung Bot, the robot platform for the future of AI

- Announces a new CSR vision: Together for Tomorrow! Enabling People!

- Marking a decade as companies led the industry worldwide in the field of digital signage numbers

- Launch smartphone 5G Galaxy S10 SG

- Completed development of treatment technologies SNM based EUV

- Announce plans to invest 133 trillion KRW in business logic chips 2030

- Start of mass production of DRAM cell 12GB LPDDRS first in the industry for smartphone premium

- Launch sensor Industry-first 108MP images for smartphones - Launch of Galaxy Fold

- Introduce the BESPOKE refrigerator, ushering in a new era of -personalization

- Delivering the world's first SK HDR10 = content on corporate television

- 50th anniversary

2018

- Launch of The Wall and QLED SK - The world’s first modular TV

- Announce the "Digital Cockpit 2018" platform, a collaboration project betweenSamsung and HARMAN

- Construct of advanced EUV semiconductor production lines in Hwaseong, Korea

- Launch of Galaxy S9 | S9 + and Galaxy Note9 Launch of the world's first 3D cinema using LED screens

- Announced mid to long term plan to expand the use of renewable energy globally

- Mass production of Sth generation V-NAND worldwide, continuing to developSGB LPDDRS D-RAM

- Announced investment of 180 trillion won and recruiting 40,000 more

employees over the next three years to revive the economy

- Established 07 global Al centers in Korea, USA, UK, Canada and Russia

- Providing the world's first commercial equipment supporting SG nettverks in the United States (FWA) and South Korea (NR Mobile)

2017

Samsung Vietnam officially opened Southeast Asia's largest Executive Briefing Center (EBC) and the Research and Development Center (Samsung Ho Chi Minh City Research & Development Center - SHRD) located at Samsung

Complex (SEHC) in Hi-Tech Park, District 9, Ho Chi Minh City

2016

Launch of Galaxy S7 phone S7 edge, Gear S2 - fashionable smart watch in the global market

SEHC project (Samsung CE Complex) of Samsung Vietnam with a total

investment of 2 billion USD is located in Saigon Hi-Tech Park with a total area

of 70 hectares, officially started in May 2015 and started to go into operation Operating on 6 2016 Officially closed the Savina factory in Thu Duc, Ho Chi Minh City and moved all production activities to the SEHC complex

- Launch of the world's first Galaxy Note edge smartphone with the world's first curved screen

- Samsung Vietnam Electronics Thai Nguyen (SEVT) project received

investment license in March 2013, came into operation in March 2014, with the factory located in Yen Binh Industrial Park, Thai Nguyen, with total investment capital 5 billion USD

- Leading smartphone and LED TV market

2007 - Leading the color TV and computer screen market in Vietnam

3.1.1.3 Samsung Electronics Vietnam Organizational Chart

Figure 3.1: Samsung Electronics Vietnam Organizational Chart

3.1.2 Characteristics of manufacturing employee at SEV

3.1.2.1 Age group

SEV’sPresident

PurchasingTeam

ManagementTeam

HR

Team

ProductionTeam

MainGroup

SMDGroup

Main

Assembly

MainEquipment

Main QC

Items Quantity Percentage

Figure 3.2: Age group

The majority of Manufacturing Employees at SEV have ages under 25 yearolds (~60%)

Figure 3.3: Gender structure

In SEV, 78.5% manufacturing employees are women, man employee onlymake up 21.5% because job characteristics

Packer 52 16.%

Figure 3.7: Job position

3.1.3 SEV’s policies for manufacturing employee

Attendance allowance: 400,000 VND/month

Living allowance: 400,000 VND/month

Allowances after apprenticeship: 300,000 VND/month

The company has a policy that the personal salary information is top secret

Day: 08:00~17:48Night: 20:00~05:48

Day: 08:00~19:05

Night: 20:00~07:15

From Mon ~ FriChange shift

2 weeks/time

Day work: 4Day off: 2

3.1.3.3 Promotion policy

The company has a policy of increasing workmanship level exam to increasebasic salary for employees

3.1.3.4 Other policies

Performance incentive bonus twice a year: 50% ~ 150% basic pay

Holidays and New Year bonus, traveling Each year, each employee getssupport from the company for expense up to 300USD/person/year to attend anylessons/ exercises for improving knowledge, skills to keep work-life balance

3.2 Analyzing manufacturing employee performance at SEV

3.2.1 In-depth Interview Analysis

Interview results showed that employee agreed that the main factorsLeadership, Motivation, Working Environment, OrganiztionalCulture, Training &Development affect their performance of (Table 2-Appendix 3): Leadership (95%),Motivation (100%), Working Environment (100%), OrganiztionalCulture (90%),Training & Development (100%) The results also show that employees in differentproduction lines are affected to different degrees, the factor that most affectsemployee is Working Environment (Table 3-Appendix 3) Employees are alsosatisfied with the monthly Leader rating and almost understand the performanceevaluationcriteria are efficiency, efficiency, produc ivity and timeliness Employees

in different production lines also experience problems caused by different factorsand the degree of affecting of the factors is different The employee's comments are

also recorded and given the solution in chapter IV.

3.2.2 The level of manufacturing employee performance at SEV

Table 3.3: SEV’s manufacturing employee performance evaluation result

n 1: C (%)

2: (%)

B-3: B (%)

4: B+

(%)

5: A (%)

You always completed the job

You always innovates your

You always achieve results in

You always comply working

Figure 3.8: Manufacturing employee’s performance evaluation result

job well above expectations (29% agree and 14% strongly agree); 42% of themanufacturing employee always innovates your work by new methods (27% agreeand 15% strongly agree) and 51% of the manufacturing employee always achievedresults in terms of output and timeline Finally, there are 57% of the manufacturingemployee that always complies working process and stage error control (31% agreeand 26% strongly agree)

expectations (8% disagree and 16% strongly disagree); 23% of the manufacturing

employee not always innovates their work by new methods (9% disagree and 14%strongly disagree) and 17% of the manufacturing employees not always achievedresults in terms of output and timeline (4% disagree and 13% strongly disagree).Finally, there are 20% of the manufacturing employee that not often work in a goodmood (6% disagree and 14% strongly disagree).

3.2.3 Findings of Exploration Factor Analysis and Regression Analysis to explore main factors affecting on manufacturing employee performance at SEV

Cronbatch’s Alpha Analysis:Through Cronbatch’s Alpha Analysis to test

reliability of scales, the adjusted scales of manufacturing employee’s performance are show on table 3.3

Table 3.4: The adjusted scales of manufacturing employee’s performance after

Cronbach’s Alpha Analysis

N

o Scale

Cronbach’s Alpha Variances

- My salary is equitable when compared with othercompany (M3)

- You are satisfied with monetary benefits receivedfrom my company (M4)

- You are satisfied with annual performance bonus

- You felt recognized and appreciated your contribution to the organization

- Safety when doing the job (WE3)

- Employees have friendly relationship with each other (WE4)

- You are satisfied with the support of leaders and colleagues at work (WE5)

3 Development Training &

0.851

- Training and development is essential for skill and competency level of employees (TD1)

- Diversity training programs helped me to enhance the performance and productivity (TD2)

- Good training methods help me boost up the morale and improve my work efficiency (TD3)

is equitable when compared with other company (M3)” and “You are satisfied withmonetary benefits received from my company (M4)”, “You are satisfied with annualperformance bonus (M5)”, “You felt recognized and appreciated your contribution

to the organization (M6)” The author names it as Motivation (X1)