Solutions for decreasing personnel fluctuation the case of OCB cho lon branch

Furthermore, going through the personnel – especially in the sales department - in theOCB Cho Lon, the voluntary turnover rate is notified with 8 people left the companycompared to 4 in

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: Ph D LY THI MINH CHAU

Ho Chi Minh City, year 2020

TABLE OF CONTENTS

Executive Summary -02

1 PROBLEM IDENTIFICATION -03

1.1 Company background: -03

1.2 Problem context -06

1.2.1 Symptoms -06

1.2.2 Symptom Validation and Justification -07

1.3 Potential Problems -10

1.3.1 Diagram of Symptoms and Potential Problems -12

1.3.2 Problem Validation -13

1.3.3 Problem Justification -17

2 CAUSE VALIDATION -20

2.1 ential Causes -20

2.2 Causes Validation -22

2.3 Causes Justification -25

3 SOLUTIONS -25

3.1 ectives -25

3.2 ential Solutions -26

3.3 Evaluation of Solutions -28

3.4 Justification -31

4 ACTION PLAN IN ORGANIZATION -32

4.1 32 4.2 Implementation Timeline -33

5 CONCLUSION -34

6 SUPPORTING INFORMATION -35

APPENDIX -36

REFERENCES -48

Executive summary

Banking is considered as one of the most intense competitive jobs in Vietnam and onthe world The thesis is going to explicit what has been happening in the bank, particularly

in the sales department in the OCB Cho Lon branch Actually, according to Churchill et

al (1) salesmen’s role is of central importance to the company and major impact on thesuccess or failure of organizations Thus, salespeople are those who determine revenue-producing efforts of corporations

However, sales job is such a kind of job not easy to work these days Salesmen have toface with a lot of obstacles in their job including target pressure, workload and customer –cares These things easily make salesmen get burnout and leading to high level of leavingintention By conducting examination in the OBC Cho Lon branch with sales department,many troubles are found out such as job stress, work-life imbalance, job dissatisfaction andeven co- worker conflicts With these problems, the finding is investigated through in-depthinterviews and real key issues are identified meticulously then

After discovering the source of the root cause – work overload that affects the job stress

in the bank, alternative solutions are designed and justified to abolish this hindrance withbenefits bringing to the company and estimating how much the firm needs to be suffered.Then, the implementation steps of action plan are also described in details to demonstrateeffectiveness of the solution – job redesign that provides salesmen a job satisfaction

OCB, the first Vietnamese bank, has completed a risk management project underBasel II (2017); that was rated by Moody's (one of the three most prestigious credit ratingagencies in the world) and ranked B2 - the highest level of commercial banks in Vietnam;and OCB is the first bank in Vietnam having integrated channel, with the Omni Channel(2018).

OCB always maintains to be among top banks in Vietnam and become a globalprestigious bank in the near future

Slogan "Belief and Prosperity" affirms that OCB brings value, prosperity to customers,partners, and shareholders; this will create a firm belief and support from customers, partnersand shareholders for the Bank's operations

Vision: Become a Leader of multi-functional bank in retail banking and small andmedium enterprises in Vietnam

Mission: Create the optimal solutions to bring the highest value to customers andinvestors, actively contributing to the common development of the community and society bybuilding enthusiasm labor forced, understand the customer needs

OCB Cho Lon branch

Established in June of 2006 with only one transaction office and some employees Atthe moment, Cho Lon OCB branch has operated with four transaction offices and over 80employees The personnel are divided in four departments including transaction departmentwith 50 employees, sales department containing 24 salespersons, and legal departmentaccounting for 6 members and 1 person with a role of cashier The OCB Cho Lon known asone of three branches having highest target and annual branch performance accounting for 8%

of the corporation The key function of the OCB Cho Lon branch offers loan and capitalmobilization that are also the same functions as other branches in the company and other ofcompetitive banks The organization chart of OCB branch and the numbers of employees are

showed up in the Figure 1 as below.

Financial Statement (vnd bil)

2310

2032,8 1850

Loan Capital mobilization

(Sources from OCB Cho Lon branch)

Figure 1: OCB Cho Lon branch organization chartWith right business strategies, OCB Cho Lon in the previous two years successfullyachieved the target of the year performance in such a way of over-expectation However, thefiscal year 2019 of the OCB Cho Lon branch was ended without good index of performanceresult Because of no target achievement of the year, this directly contributed to the wholeorganization in term of revenue decrease The financial statement of the year 2019 is to beanalyzed in the Figure 2 as below for demonstration

Source: Human Resource Department of OCB Cho Lon

Figure 2 Turnover rate in Sales Department of OCB Cho LonFrom the financial statement above, it is easy to recognize that OCB Cho Lon, in thefiscal year 2017 regarding to loan segment, gained 123% over far from the target, and

obtained

118% for the capital mobilization factor In the fiscal year 2018, the branch also achieved112% over target toward to the loan section and acquired 118% for the capital mobilizationelement This is considered as an amazing result for the company in general and for the OCBCho Lon branch in particular In the contrast, the fiscal year 2019 was considered as

“noticeable year” to be analyzed to explore the reason why OCB could not achieve theexpectations and target as expected The year performance just attained 88% regarding toloan criteria and only 87% for capital mobilization By further observation, the result in thefiscal year 2019 was even a little bit lower than the year 2018 Through analyses, thefiscal year 2019 of OCB Cho Lon negatively affected the business performance of thewhole company

Furthermore, going through the personnel – especially in the sales department - in theOCB Cho Lon, the voluntary turnover rate is notified with 8 people left the companycompared to 4 in the previous year at the percentage double higher Therefore, this is also apoint that needs to be concerned in the research

From the literature reviews, according to Ampomah and Cubjor (2), the company may

be negatively affected on providing services to customer when losing talent or key employeeswho have a profound impact on organizations Similarly, Aguinis (3) postulated that if a keyperformer leaves the company, it likely happens in such a way that a replacement for thisposition never obtains the same level Take a look at reality happening in the OCB Cho Lonbranch, the deputy branch director shared:

“High turnover rate has recently influenced to branch performance Take a sales team 3 for example, eight salesmen left the company, especially including an elite employee; and as the consequence the team 3 has been staying in the bottom position in results between 3 sales teams in the branch Seldom did this happen in some previous years when the team had this person’s service; and he frequency presented in the top 10 bestsellers of the year in the corporation.”

In general, employees titled talent are long-term assets of firms, and this was confirmed

by Martin and Schmidt (4) Michael et al (5) published employees are assets of companies, soturnover is a high cost for companies in both tangible and intangible features and affecting toorganization’s performance Additionally, Shaw et al (6) advocated, high turnover ratenegatively effects workforce performance in term of low profitability levels and harmfullyinfluences financial performance in term of hiring and training costs Thus, there were manyfindings mentioned in this section, and Solomon as cited by Sturman et al (7) establishedcosts that organizations have to be suffered are calculated from 1.5 to 2.5 times of annualsalary of laborer Overall, this can affect organizations’ performance and lead the company

to another way if these talent people left the company and worked for competitors in thesame industry.

Therefore, high voluntary turnover rate could be a symptom that needs to be validated, andthen the problems need to be identified Analyzing and diagnosing the problems is essential

to be taken place to discover potential causes Once root cause is identified, the thesis willprovide the solutions and implementation plans to improve the company situation

1.2 Problems context:

1.2.1 Symptoms:

The finding is conducted with three groups: Group one consisting of deputy branchdirector, sales manager and salesmen who are still working for the OCB Cho Lon branch, thesecond group with salesmen who left the Cho Lon branch already, and the last groupincluding three sales managers in HCM, Ben Thanh and Phu Nhuan branch Based on thedata from Human Resource Department of OCB Cho Lon provided by the deputy branchdirector, the voluntary turnover rate of salesmen in the fiscal year 2019 is higher than twoprevious fiscal years To clearly demonstrate about this, the table 1 as below shows the result

of turnover rate of the OCB Cho Lon branch

Turnover Rate in Sales Department Fiscal year 2017 Fiscal year 2018 Fiscal year 2019 Fiscal year 2020

Source: Human Resource Department of OCB Cho Lon

Table 1 Turnover rate in Sales Department of OCB Cho Lon 2019From the table above, it showed that the turnover rate of Salesmen in the fiscal year(FY) 2019 at 38.1 percent, which significantly higher than the FY 2018 and far over doublehigher than FY 2017 This means that the voluntary turnover rate is straight upward and nosignal of stopping In this case, the number of turn overate 38.1 percent seems to illuminatethat working in the banking industry is not easy at all As the matter of the fact, banking

is known as a difficult industry for employees to work in, and this can be more demonstratedthrough the post survey from seminar report of Talentnet-Mercer in October 2018 (8) (Table2) - the voluntary turnover rate of Banking with 19.6 percent was in the top 2 industries

in Vietnam market Compared to turnover rate in Sales Department of OCB Cho Lon branch

in the previous year

2018, the data reveals that turnover rate of salesmen in the FY18 is higher than the market’s as well.

Table 2 Post Survey Seminar Report of Talentnet - Mercer shared to participants

1.2.2 Symptom Validation and Justification:

To understand clearly about this, through the interview, deputy branch director in OCBCho Lon shared:

“Salesmen left the job because they could not achieve the target offered by the company that made these employees received unexpected incomes Furthermore, with the company’s policy, those who cannot achieve the target offered in three straight months will receive only 80 percent of basic salary This is also a key factor that laborers quit the job.” He added “In the year 2019, the salespeople quit the job higher than last one; therefore, the company had

to recruit others to replace these positions The human resource department might not

be good in selection of salesmen, and the evidences showed that the business operation of the branch in this year is so much lower than previous year.”

Similarly, from the theoretical aspect, Carraher (9) indicated salary and benefits areimportant factors to attract and lure employees Additionally, Matz et al as cited by Schuck et

al (10) asserted that salary is an important factor in understanding job satisfaction and thecommitment of the company Therefore, uncompetitive salary and unattractive incentivepolicy which can be called incomes dissatisfaction is one of reasons for employeesleaving the company

As a consequence, unexpected income is one of the elements in the OCB Cho Lon

factors

collected through interviews that have been affecting to voluntary turnover rate in the branch.Take an interview with existing salesman for demonstrating:

“In some new first months I worked for the company, it seemed to finish tasks easily, but when

I received the target from sales manager, it drove me crazy I usually went home late because

I tried to finish the target of the day This is one of reasons why some of salesmen quit the job.”

Besides situations occurring in the OCB bank, many findings have been conducting toillustrate this issue According to Frone et al (11), long work hours is an element that causeswork-life conflict This obviously presents to the fact that employees want to leave the joband find another one to have much more time for their own family In general, highcompetition in the bank market requires salesmen have to maintain energy in seekingcustomers and bringing these clients to the company These directly take a lot of time ofsalespeople and additionally these employees have to take care from the beginning of loan orcapital mobilization procedures such as checking eligible documents and liability capability

to disbursement With the workload like that these people must spend extra time to finishthese procedures after meeting customers in the day time Frequently working in nighttime leads to a consequence that employees cannot keep their work and personal life inbalance Work overload and no time for family make salesmen burnout and stress; therefore,

a prediction of voluntary turnover intention can be imagined in the near future

Looking to further other branches in the OCB branch system, the data collected in theTable 3 has demonstrated that OCB Cho Lon branch has maintained the highest turnover-related index through three straight years

Turnover Rate in Sales Department Branch HCM Cho Lon Branch Ben Thanh Branch Phu Nhuan Branch

Source: Human Resource Department of OCB Cho Lon

Table 3 Turnover rate in sales Department of OCB branches

annually higher and higher Therefore, this must be a symptom that needs to go further to explore what

have been happening in the OCB Corporation However, with time limited, the finding justfocuses on the OCB Cho Lon because, taking a careful notice, there must be an issue to thisbranch with the numbers of employees left the company were double higher its previous year,and was always in the highest position of turnover rate in every single year of wholecorporation.

Through interviews in these branches above, the turnover rate not only affected businessperformance but also contributed to reduce business efficiency of the corporation Toillustrate about this, the sales manager in HCM branch stated:

“I do not remember exactly how the turnover rate was in 3 previous years, but as far as I know is that there were 5 employees who quit the company in 2019 and the level of turnover rate was higher and higher After doing analysis from board of directors, the branch business performance is a bit negatively influent comparing to previous years Fortunately, the branch finally finished the year 2019 with just enough to achieve the target.”

Regarding to OCB Ben Thanh branch:

“In two previous years, there were some cases of quitting the job from sales department This also contributed to make the business performance of the branch go in such a way

of no expectation Particularly, the Ben Thanh branch could not gain the target offered by corporation” shared by Mrs L – sales manager

Another information from Phu Nhuan branch revealed by Mr A:

“The turnover rate in the branch has a tendency to increase The replacement of employees left the company is necessary but new comers needed a lot of time to adapt to new environment and requirement of the banking sector Therefore, if having many cases of replacement like this, it will negatively effects to the branch business performance Take a last year for example, the final result of the branch was just near to the target.”

Take a glance at the data shown in the Table 3, although the number of salesmen washigher comparing to its previous year; Nevertheless, the number of employees quit the bankwas also increased, and this eventually caused high voluntary turnover rate in every singlebranch Many researchers found that there is a relationship between turnover and costs, andhigh level of turnover rate is contributing to decrease the business outcomes Through theresearch of Tracey and Hinkin (12), the authors published involvement in recruitment,training, development is presenting to a direct cost that corporations have to be suffered Inaddition, Abbasi et al (13) indicated that beside involvement of visible costs of turnoversuch as costs of termination, advertising, recruitment, selection, hiring, training, andassigning, there are many hidden costs such as disruption of customer relations, the erosion

employees acquire their tasks

and achieve efficiency This can be a part of troubles that the OCB Cho Lon has faced to via the interview from the deputy of branch director in OCB Cho Lon branch:

“With many new salesmen in the year, board of branch directors took a lot of time to train them, and the targets for these people were not applied in probation After the probation the target for these new ones also in an acceptable target and the branch cannot expect too much on them”

In summary, the turnover rate in the internal OCB Cho Lon branch is more and morewithout signal of stopping and even higher than other branches in the HCM area In addition,problems occurring in the OCB Cho Lon are also the same with other branches; therefore, aninvestigation in this branch is a-must to be conducted in order to understand where the rootcause comes from

1.3 Potential problems

According to Delfgaauw (14), there are a lot of motives for employees to quit their jobsuch as threats of restructuring, duration of contract, financial prospects, work pressure,job duties, work-life balance, commuting time, style of leadership and etc In order tofind out the problems causing to high turnover rate in OCB Cho Lon, some of in-depthinterviews were conducted

According to deputy branch director:

“Salesmen left the company because there could be some of reasons such as low incomes when they cannot reach the target This is obviously true in the branch because I am the person approving salesmen salary monthly.”

Take another sharing from a salesman left the company to dig deeper in this circumstance:

“Laborers almost work for two main reasons: one for earning money and the other for passion To me, both of them need balancing because nobody can work in a long time without passion and unexpected salary Therefore, the company’s policy related to salary is one of reason I left the company”.

Looking up to the literature review, O'Neill (15) figured out that voluntary turnoveroccurring in employees with low income is much more than others Additionally, Pullins(16) indicated salary and commission are components of compensation that attract employees contributing to increase level of performance

Take another sharing, a sales manager stated that

“The target is higher and higher year after year so that salesmen have to work so hard in order to complete their tasks from every single day That is a reason why some of salesmen

getting married with children cannot keep their own life in balance; they need more time to take care their family that is a sharing from one of left persons.”

This is also admitted by deputy branch director:

“In banking segment, the job requires employees – especially salesmen – have to make appointments with customers, and the meetings happen after working time is understanding and unavoidable Therefore, this is a particular criteria for this position and salesmen must accept this.”

Furthermore, this is more emphasized by agreement of the existing salesman:

“The phrase - go home late - is considered as a “specialty” in the company because it is not strange with sales people in general and especially salesmen working in bank industry.”

In addition to this, the left salesman announced that:

“Annually, the target offered by sales manager is more and more, salespeople like me have

to chase the target unceasing to meet clients in or even out of working time, and after coming back to the office, we continue with our paper work such as daily report and checking whether clients’ documents is eligible or not Honestly, we are usually finishing the day quite late rather than others working in the office only.”

From the theoretical literature, Pradana A, Salehudin (17) pointed out that workoverload is a factor that significantly contribute to increase turnover intension In the otherside, Suifan et al (18) asserted the more conflicts employees have in work and theirpersonal life, the more these laborers struggle keeping a balance; and therefore, leavingthe job is inevitable

Likewise, an existing salesman stated:

“High competition in the bank market that make salesmen like me sacrifice a lot of things such as no time for personal issues and have to try best to achieve target Some of my colleagues left the company because, in the branch, there have been conflicts between employees together in term of fight-over-customers Thus, to be presented in high competitive industry, salesmen have to bring as many contracts to the company as they can in any circumstances.

Looking back to theory aspects, Gazioglu and Tansel (19) argued job characteristicsincluding income, hours of work, industrial section and occupation lead to employees’dissatisfaction when these people receive under their expectation

It is not the whole things occurring in the OCB Cho Lon, another matter has beenhappening in the branch and being shared via interview by the deputy branch director:

“Some of salesmen are not suitable for this bank because their customers are different from our segment Actually when someone left the company, the human resource department always asked for the specific reason, and as the result the reason focused on the personal

issues in terms of finding another workplace to promote their career or something like the work here is not suitable for them.”

From the sharing of the left salesman, the personal issues are exposed that

“In case of salesmen could not reach the target, the received salary would be cut down and salesmen like me just want to find another place to work for rather than spending a lot of time for this company with the career insecurity.”

Additionally, finding other challenges is happening in the branch via the interview:

“When collecting enough experiences, some of employees want to find challenges in higher position with another workplace Take a salesman in the team 3 for example”, shared by existing salesman

From the finding conducted in banking industry, Shukla and Sinha (20) asserted workenvironment, job stress, salary, employee relationship and career development areelements that lead employees to high turnover intention levels Combining the literaturereview and arguments exposed above, the study can summarize four main factorsthat made the headcounts decrease in the OCB Cho Lon through a diagram as following

1.3.1 Diagram of Symptoms and Potential Problems:

Figure 3: Diagram of symptoms and potential problems

1.3.2 Problems Validation

Based on the Figure 3, it is not difficult to recognize that there are four potentialproblems identified from the interviews that are job dissatisfaction, job stress, workincompetency and personal issues With these problems, it demonstrated that the level ofturnover rate in the OCB Cho Lon branch is higher and higher As the consequence, theyear performance of the branch could not be as expected when the company had a highpersonnel fluctuation of salesmen Therefore, the cost spending on recruitment andtraining is also increased, and that is such a way to waste money of the company.Through the interviews and searching from literatures, the findings of these singlefactors are going to be discovered in turns in order to figure out the main problemcausing to the high turnover rate in the sales team of OCB Cho Lon

+ Job dissatisfaction:

According to Mangel and Useem (21), compensation and employees’ benefits play a keyrole for profitability and increasing organizations’ performance In addition to this,Carraher (9) insisted employees without pay satisfaction is likely to seek employmentelsewhere Thus, employees without salary satisfaction will produce negative behaviors toorganizations such as strikes, turnover intention or poor performance, Hung et al (22),published

From interviews, the salesman who has left the company revealed that

“Everybody earns money to take care their family’s life and spending money on personal cares for themselves However, with the policy of the company, the salary will be low down and even be terminated labor contract if you could not meet company requirement and this criteria is just shown up on the single personal result.” He added “I used to raise idea in the meeting that the company should take a look back of the policy related to pay for performance because nobody do not want complete the target If not, the target should reasonable to achieve.”

However, in the different thinking, sales manager explained that

“I think the company is on the way to do well in the term of paying for performance for salesmen I know this is challenging them so much but the incentive and commission are much higher if they complete the target So, if you want to improve your life, just do your best and do in such an intelligent way.”

As the same opinion, deputy branch director shared:

“With the new strategy I knew, the OCB Corporation just wants to retain and keeps the talent people This required salesmen have to work one hundred per cent of their abilities to survive

in this recently intense competition of bank industry in Vietnam This was also one of the key factors why the company fired nearly one thousand employees in this year.”

Thus, go deeply single statement above, some researchers discovered that determination theory is considered as an autonomous motivation when understandinghuman requirement, Deci et al (23) postulated Many researchers asserted that withautonomous motivation, it is better to acquire purpose than motivations which can be used

self-by award or punishment avoidance

+ Job stress:

Stress is a common issue in any kind of work and people have to scope with it inalmost day of life, asserted by Shahid et al (24) According to Sager (25), job stress isdefined as the psychological state facing to demands, tensions, or opportunities whichare important but not certainty DeFrank et al (26) published that stress is a concept

of an adaptive response from consequences of actions, events or circumstances putting

on human demands There are a lot of sources causing to stress today, especially in theworkplace, such as work overload, lack of experiences in a job, lack of clear jobdescription, uncertainty, co-worker conflict, or no career development, the author added.Additionally, Moncrief et al (27) stated that job stress can be occurred and pressured

on salesmen when requiring productivity, company restructuring, increasing highcompetitive industry, and especially changing in sales strategies

Besides exposing from researchers above, take a look back to the interviews that arerevealing as following:

“The time I worked for OCB seemed from nine to ten hours per day In the day time, after seeing customers to introduce and sell of OCB products, I had to do a check whether these customers meet our requirement related to financial security and eligible status or not Furthermore, the setting actions plan and updating report through online system daily made

me burnout The thing also needs mentioning here is that I have no time for family and even for my leisure,” the left salesman exposed

With a similar opinion, the existing salesman provided:

“Although working as a team but there are multi-tasks need to be done per day, I have to deal with all of them by myself It is difficult to have a help from another one because salespeople have a bunch of work and they also need to obtain the target; therefore, we have

no time for supporting others.”

Combining to evidences shown up above – salesmen frequently go home late, thismeans the workload for employees seems to be over so that these salesmen have no time

for their own life and their family Thus, according to Abhyankar and Pujari (28), jobdemands employees spending numbers of hours for work; therefore, workload is mainlyassociated with work-life imbalance.

Furthermore, take another information from the sales manager through interview:

“There is an issue existing in the salesmen between different teams; they can steal customer each other when having a chance This could be a reason of high pressure for the target they have to complete; therefore this is such a kind of pain in the neck of our branch.”

In addition to this, the deputy branch director also stated:

“In OCB Cho Lon, salespeople can contact a specific customer to attract customers to get a loan from the bank That can be called fighting over customer With this message, salesmen have to strive more and more to put a good impression and friendly image on customers If not, these customers can be taken from other salesperson.”

Going back the information shared by existing salesman:

“Fighting over customers is not strange to salespeople Once information of customers is revealed, anyone of salesmen can contact to these customers as long as these ones are not captured by other competitors.”

From the theoretical aspects, Nixon et al (29) argued that co-worker conflicts seemlikely to be emotional labor so that this emotion react against other employees with angerand then creating strain during working Once strain presenting in the workplace, the jobstress appears then because strain – related conflict is a significantly important predictorcausing to job stress, Vickovic and Morrow (30) postulated

Thus, job stress is one of crucial factors negatively affects to organizations becausethis directly influences to both laborers’ physiology such as headache, fatigue or hard-breath and employees’ psychology – emotion-related responses like anxiety,nervousness or anger These symptoms definitely bring to employees uncomfortableand unsatisfactory states during working that leads to obtain unexpected results at theend To demonstrate about this, according to Sheraz et al (31), job stress negativelyinfluences to both employees’ performance and work in organizations; the research alsorevealed the effect of job stress on turnover intention In addition, job stress causes tointention to leave reducing of the commitment to organization through salespeople’sperception, Sager (32) reported Therefore, job stress can be a significantly importantelement that all of firms need to be concerned

+ Work incompetency:

There are many sources for companies to hire laborers in the market includingreferral, agencies, newspaper advertising, recruitment-websites, and even reemployedthose who left the organizations According sharing from the deputy branch director:

“Salesmen are majorly recruited by the central of human resource department of the company, and these persons will be deployed to branches including OCB Cho Lon This leads to that we cannot assess how much experience and what advantages they collected

in the past.” He added: “We just evaluate these new members through their behaviors during probation As a consequence, these people left the company after one year later and even some left just a couple of months later on.”

From the angle of theory, Gannon (33) argued that the highest turnover rate belongs tothose who came to the bank from hiring agency, and the second one is from newspaperadvertising The report means that using laborers from intermediary will receive a highvoluntary turnover rate, and the unexpected result in business operation is unavoidable.Thus, Delery and Shaw (34) pointed out that performance of organizations will beeffected by three kinds of employees’ characteristics including capability, motivation andentrustment Thus, employees’ ability is identified as a key factor to help an organization

be the more valuable and more successful Therefore, in order to recruit a right person,human resource department needs to fundamentally focus on the competency what the jobrequire

Taking to a statement from the sales manager:

“Salespeople recently cannot meet requirement of the job, especially new comers, they take

a lot of time to customize with the job.” He added “some of these people came from other banks; unluckily, they familiarly experienced in the different market segments or customer segments That is a main reason why they cannot survive in the OCB bank.”

+ Personal issues:

According to Shier et al (35), three elements directly affect to laborers’ jobdissatisfaction and high turnover rate are work, profession and personal issues Inaddition, Wren et al (36) indicated that there are five categories contributing topropensity to leave the company including job satisfaction, organization commitment,job involvement, job stress and personal characteristics with education, age, income….Boles et al (37) argued that cognitive, behavioral and effective characteristics ofsalespeople such as personal traits, demographics, stress, workload can shape theattitudinal processes that involves in psychological equilibrium, job satisfaction, socialand self-identification and commitment

Thus, these attitudes in the context are considered as factors that lead the salesperson whether staying or quitting the job.

To support for this ingredient, take the interview of deputy branch manager todemonstrate further

“Some of salesmen left the company shared that they could not be adapted with the company’s environment and culture Especially, they could not find the certainty of the job if they try to survive here.”

Take another interview shared by the left salesman

“I realize that there are many things I were dissatisfied such as the salary-cut-down, high target and especially poor cooperation between salespeople They always want to get as much customer as they can so that these people easily ignore others when they need helps.”

From the evidences above, it is easy to recognize that the role of sales manager in thiscircumstance is not effective According to Honeycutt et al (38), sales managers are asplanners or instructors to participate in the training program for salesperson Thus, Rich(39) published that sales managers play as a key role in molding, shaping and sculpturing salespeople’s attitudes and behaviors

Take a look to the interview with sales manager to illustrate about this

“With the intense competition in this market, individual salesperson has to try their best by using their abilities and what they experienced to fight against other competitors in order to gain target and expectation from board of directors.”

1.3.3 Problem Justification

Based on the diagram of symptoms and potential problems, there are four main factorsleading to high turnover rate in OCB Cho Lon including job satisfaction, job stress, workincompetency and personal issues The thesis is going to analyze one by one to figure outwhat the real key problems are in this circumstance

The first element the thesis is going to begin with is job satisfaction Looking back tointerviews conducted in the OCB branch, some information is reviewed as below:

“I think the company is on the way to do well in the term of paying for performance for salesmen I know this is challenging them so much but the incentive and commission are much higher if they complete the target.” shared by sales manager

Additionally, the deputy branch director stated that

“With the new strategy I knew, the OCB Corporation just wants to retain and keeps the talent people.”

From the literature aspects, according to Runes et al (40), the term performance is a good way to improve employees’ performance To be clearer aboutthis, Kuvaas et al.

pay-for-(41) figured out that employees should enhance their effort to earn receivables expected sothat pay for performance is a key element that needs to be applied in order to upgradeemployees’ attempt

With some evidences, the findings cannot make sure whether this element is a realproblem or not because this belongs to the company’s policy and strategy However,according to Madhura et al (42), job satisfaction and job stress are significant correlatedeach other Additionally, Lambert et al (43) indicated that reducing job satisfaction is aprocess to increase job stress and vice versa In conclusion, job dissatisfaction is somehow

a subset of job stress that is going to analyze later; therefore, in this situation, jobsatisfaction can be taken out of potential problems causing to high turnover rate in theOCB Cho Lon branch

The second element that the thesis is going to clarify is work incompetency Throughinterviews, the left salesman reported that:

“Everybody needs time to adapt to new environment working and culture in new workplaces The adaptability depends on employees’ characteristics and knowledge they experienced Actually, to be a salesman in the OCB bank, these candidates had to spend some recruitment rounds from the banking – associated tests to soft skills - dealing with incidents with customers.”

With a similar idea, the sales manager also shared:

“Some of new comers are good at dealing with customers-related problems but their customer segmentation is different from the company Therefore, these people have to need more time to build up their network and relationship.” He added: “Regarding to fresher – students have just graduated – they have a passion and full of energy In order to help them finish the work well, they need to be trained and have support from managers In the OCB Cho Lon branch, there has been one training for every quarter.”

Thus, according to Roman et al (44), sales training is a mean of increasing salesproductivity and business performance Roman and Ruiz (45) reported that sales training

is the effort that employers give opportunities to for the salesmen to meet job-relatedskills, knowledge, attitudes and concepts so that salespeople can accomplish the jobefficiently and successfully To strongly emphasize about this, Loveland et al (46)

move from

company to another firm with just a little bit of difficulty As illustrated above, work incompetency is not really a point to be concerned in this case.

Another element the thesis continue mentioning is personal issues This is describedthrough the interviews and take a look back to the sharing from deputy branch director:

“When salesmen quit the job, some reasons noted were something related to personal issues such as finding another challenges, not suitable with the company or post-graduating.”

With the same information, the existing salesman exposed that:

“When collecting enough experiences, some of employees want to find challenges in higher position with another workplace Take a salesman in the team 3 for example.”

Thus, these reasons are common ones and they are easy to find out in other companiesbecause these are such kinds of personality – associated issues that come out fromindividuals’ needs Besides, from the view of literature, Cotton and Tuttle as cited inSutherland (47) stated that personal characteristics including skills, age or marital statusaffect to voluntary labor turnover Generally, personal issues seem common problemsoccurring in other corporations; therefore, this variable is not a real problem causing tohigh turnover rate in the OCB Cho Lon branch

Last but not least, job stress is one of the ingredients occurring to workplace Imtiazand Ahmad (48) asserted that factors causing to stress were identified such as personalissues, poor administration support, lack of recognition, work environment and inadequatemonetary reward Agreement with this idea, Sager (32) argued job stress is a kind ofstrain that causing from overall job dissatisfaction and organization commitments As theconsequence, data gathered from interviews also display this

According to the existing salesperson, he state that:

“The strain from work made me crazy and easily lost control in dealing with problems I usually finish the work until 7 pm and then feel very tired in the following day Moreover, the work environment here is actually not for normal salespeople because they have to protect themselves from external and internal competition The co-workers here are also

my competitors as well.”

Another sharing from the deputy branch director:

“Regarding to sales department, these salesmen have to spend almost their time finding, phoning and meeting customers; therefore, they have not much time for other tasks such as

report, making action plans or checking customers’ reliability In order to be a best seller, they need to arrange their time and having particular plan for every single day.”

With the same opinion, the sales manager provided that:

“The target is higher and higher year after year so that salesmen have to work so hard in order to complete their tasks from every single day That is a reason why some of salesmen getting married with children cannot keep their own life in balance; they need more time to take care their family that is a sharing from one of left persons.”

Besides primary qualitative data, there are many theoretical researches figuring outhow stress affects laborers’ productivity and become job-quitters Goolsby (49)argued that stress comes from the nature of salesperson’s environment In addition,Arshadi and Damiri

(50) argued employees experiencing high level of job stress are likely to be lessproductive, less safe at work and poorly motivated According to Villanueva andDjurkovic (51), stress at work is a source of contribution to costly voluntary turnover.Moreover, Pahi et al (52) published that there is a positive relationship between jobstress and turnover intention; once job stress increase, intention to leave the companyincrease then

Thus, with a bunch of work salesmen have to deal with, these people have to workfrom nine to ten hours every day that lead sales employees to have a work – lifeimbalance If laborers have no time for their family or their social activities to refreshtheir mental and physical health, it is easy to be in a state of fatigue and bored mood.Besides that, these salesmen also are pressured from target offered by board of directors;they have to chase to achieve the target in order to earn adequate salary That is not awhole story in this case, in the end of the day, one more thing salesmen need to do is thatthey have to report what they did and what they are going to do tomorrow This is also atask that sales people have to spend much time to perform Therefore, job stress is a keyfactor that the company has been facing to and need to be solved up as soon as possible

As demonstrated from in-depth interviews and literature reviews, job stress is the mainproblem that made salesmen leaving the job, and through this element, the thesiscontinues exploring more in detail to figure out what the root cause is

2.1 Potential Causes

According to Shahid et al (24), in the banking sector, lack of support from managers,

work overload, poor relationship with co-workers, or even colleague conflicts and work –

life imbalance are factors causing stress and reducing the employees’ performance.Moreover, some researchers such as Materson as cited by Mahmood et al (53) postulatedcauses of stress are things including workload, long work hours, inappropriate workingconditions, heavy responsibilities and poor relations with colleagues Hence, job stress is asignificantly important element that any company has to be concerned and havingappropriate solutions to maintain skilled employees and business performance oforganization is a need.

Take some data from interviews by the left salesperson in order to more demonstrateabout this:

“The time I worked for OCB seemed from nine to ten hours per day.” He added “I was dissatisfied such as high target and especially poor cooperation between salespeople.”

This person is also emphasized:

“We continue with our paper work such as daily report and checking whether clients’ documents is eligible or not.”

Another sharing from the existing salesman:

“There are multi-tasks need to be done per day, I have to deal with all of them by myself.”

From the point of view of deputy branch director, he revealed:

“ In OCB Cho Lon, salespeople in three teams can contact a specific customer to attract customers to get a loan from the bank That can be called fighting over customer.” Headded “salesmen have to spend almost their time finding, phoning and meeting customers.”

The deputy branch director also indicated:

“Some of salespeople could not survive here because their ability was not met the job requirement.”

Thus, through the interviews, stress is identified as a major factor in such a way that isfrom multi-tasks responsibility such as finding and meeting customers, paper work related

to financial analysis for customers, and care for customers’ loan that led salesmen haveusually been going home late for finishing their word load per day

To sum up, there are a lot of elements leading to job stress in the OCB Cho Lonbranch Based on both of the literature reviews and interviews, the causes and effectstree can be drawn as below

Figure 4: Diagram of Causes and Effects

2.2 Causes Validation

As the diagram of causes and effects above, there are three factors including co-workersconflicts, work overload and work-life imbalance that are directly causing to job stress andthen negatively effecting to high turnover rate in the company In order to understandthese ingredients transparently, the thesis is about to go further in every single element

+ Work-life imbalance

According to Greenblatt (54), work – life balance is defined as the absence ofunacceptable levels of conflicts between life and work demands To demonstrate this,Khattak et al (55) pointed out that the workplace, especially in banking industry, is apotential source of stress for bankers because they have to spend amount of time workingwith work load they are undertaking

Take a look to data collected from interviews, the existing salesperson stated:

“The phrase - go home late - is considered as a specialty in the company because it is not strange with sales people in general and especially salesmen working in bank industry Most

of us just have time for family in weekends.”

Another information, deputy branch director shared:

“In banking segment, the job requires employees – especially salesmen – have to make

and unavoidable Therefore, this is a particular criteria for this position and salesmen must accept this.”

Thus, being as a salesman, lack of time for family and social activities can lead thesepeople into both physical and mental stress, and this is also defined as a main sourcecausing to work – life conflict, Greenhaus and Beutell (56) published According toWilliams and Alliger (57), Tabassum et al (58), high task demands such as a greatamount of work that need to be done and these employees have to work hard that leadlaborers to work – family conflict With this literature, it is considering that workoverload is a main factor causing to work – life conflict in this situation

+ Co-worker conflicts

Co-worker conflicts is one of variables that need noting in any workplaces becauseworkers’ innovative behavior can be resisted and reduce employees’ performance, Janssen(59) discovered

From the interview with sales manager, he declared:

“It is inevitable that there is a conflict between salesmen when trying to fight over customers.”

According to Mulki et al (60), tensions and negative impact to job performance can

be caused by mutual interactions and emotional demands of salespeople if not managedwell Thus, the author also emphasized that the exchange of information betweenindividuals become difficult and decreasing work effectiveness when having strain inthe work environment

Another sharing by existing salesman, he stated

“Fighting over customers is not strange to salespeople Once information of customers is revealed, anyone of salesmen can contact to these customers as long as these ones are not captured by other competitors.” He added “The co-workers here are also my competitors

as well.”

“It is difficult to have a help from another one because salespeople have a bunch of work,”

the existing salesman also shared

Although knowing that it is a kind of culture in sales job, the sales manager andsalespeople also need to mutually communicate together so that these salesmen cancooperate each other finding the way to win over customers This is a truth through thefindings of Millman (61), the author asserted that salespersons’ communication strategyand requirement of sales manager working closely with colleagues are priority inenhancing sales performance Additionally, La Rocco and Jones (62) stated co-workers support

positively create companies’ outcomes such as higher satisfaction, stress reduced andtendency to remain in corporations In fact, co-worker conflict is seemed as a main reasoncausing to job stress; however, take a further review, in this circumstance, salesmen have

to spend time doing their own tasks and have no time left to support others Furthermore,fight-over-customers is considered as an intense competition in sales jobs; salesmen have

to understand about this and protect customers’ information from others Therefore, worker conflict is not really a root cause so that this element can be eliminated out of thecase happening in the OCB Cho Lon branch

co-+ Work overload

Work overload is the last variable contributing to job stress in the OCB Cho Lon This

is confirmed by Herr et al (63), the author revealed that work stress is appeared whenhaving work overload that requires high demands in work Additionally, Hon et al (64)stated that work overload is one of significantly important sources of stressors

Looking back to the sharing from the existing salesperson, he explained:

“When having a lot of things in the work waiting to be finished, I just want to sit back and

do nothing However, I still have to meet customers as a schedule because as a professional salesman, it is extremely important to keep the promise As you know, the result would be usually not good when seeing customers with a bad mood.”

Actually, when stress occurring in the workplace and it is not managed, employeescannot work in good mental status that leads to reduce quality, productivity, health andeven decrease laborers’ morale, Dhankar (65) postulated Therefore, salespeople in theOCB Cho Lon cannot finish the job as expectation and this is clearly to understand whythese salesmen could not reach the target To be clear about this, Shahid et al (24)asserted work pressure is produced by incapability of salespeople to maintain a balancebetween family life and work life when these salesmen spend almost their time onworking

Another opinion from the left salesman:

“The target offered by sales manager is more and more, salespeople like me have to chase the target unceasing to meet clients in or even out of working time, and after coming back to the office, we continue with our paper work such as daily report and checking whether clients’ documents is eligible or not Honestly, we are usually finishing the day quite late rather than others working in the office only.”

He added “The setting actions plan and updating report through online system daily made

me burnout The thing also needs mentioning here is that I have no time for family and even

As the result, work overload is a significant factor need to be concerned by anycompanies In order to recognize whether this factor is a root cause or not, the thesiscontinues examining with next stage to justify this.

2.3 Cause Justification

According to Narayanan et al (66), interpersonal conflicts is described as a majorstressor by sales department However, this factor is not likely a real cause leading to jobstress in OCB Cho Lon Take the information from the sales manager for illustration

“There is a monthly meeting of sales department and, in the meeting, salespeople are able

to raise their difficulty facing in the month After that, board of directors will discuss together and offer a best solution in every single situation.”

The sales manager also exposed:

“To help them finish the work well, they need to be trained and have support from managers In the OCB Cho Lon branch, there has been one training for every quarter.”

And another sharing from the existing salesman:

“I will help them especially toward to new comers.”

As the result, co-worker conflict can be taken out of radical causes and continue toexamine other ingredients else

Many researchers demonstrate relations between work-life conflict and high level ofworkload Skinner and Pocock (67) asserted that regarding to full-time employees, themajor factor associating with work-life conflict is work overload While Byron (68)emphasized that work overload is absolutely considered as the strongest predictor ofwork- life imbalance Similarly with this opinion, Waters and Bardoel (69) postulatedhigh level of workload is described as a key element reducing the uptake of work-lifepolicies

From argument demonstrated above, work-life imbalance is also not the root causebecause this variable apparently is playing a role as a consequence of work overload Thismeans that when employees are facing multi-tasks and a pile of work waiting forimplementation, it is easy to have these salespersons concentrate on the work rather thanfamily or social activities In conclusion, work overload is definitely a root cause in thiscircumstance and needing to be solved in the OCB Cho Lon branch

3.1 Objectives

Finding real problems that have occurred to workplace but no solutions for the