Factors affecting work performance at ho chi minh commodities trading JSC (HCT)

MINISTRY OF EDUCATION AND TRAINING STATE BANK OF VIETNAM BANKING UNIVERSITY OF HO CHI MINH CITY Major BUSINESS ADMINISTRATION Title FACTORS AFFECTING WORK PERFORMANCE AT HO CHI MINH COMMODITIES TRADIN[.]

MINISTRY OF EDUCATION AND TRAINING STATE BANK OF VIETNAM

BANKING UNIVERSITY OF HO CHI MINH CITY

Major: BUSINESS ADMINISTRATION

Title:

FACTORS AFFECTING WORK PERFORMANCE AT

HO CHI MINH COMMODITIES TRADING JSC (HCT)

TRAN MANH VU

Student ID: 050607190645

ADVISOR by Dr BUI DUC SINH

HCM City, June 2022

Examined by Advisor, Dr Bui Duc Sinh

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CONTENTS

Acknowledgements 1

Abstract 2

CHAPTER 1 OVERVIEW OF COMMODITIES TRADING 3

1.1 Definition 3

1.2 How Commodity Markets Work 3

1.3 History of Commodity Markets 3

1.4 Types of Commodity Markets 4

1.5 Commodity Market Trading vs Stock Trading 5

1.6 Commodities trading in the world 5

1.7 Commodities trading in Vietnam 6

1.8 Summary of the chapter 7

CHAPTER 2 INTRODUCTION 8

2.1 Problem Formulation 8

2.2 Research objectives 13

2.3 Scope of the study 14

2.4 Outline of the study 14

2.5 Summary of the chapter 16

CHAPTER 3 LITERATURE REVIEW 17

3.1 Definitions 17

3.1.1 Employees 17

3.1.2 Work performnace 17

3.2 Previous research 18

3.3 Theoretical Basis 19

3.3.1 Theory of Compliance 19

3.3.2 Theory of Work Attitude 20

3.3.3 Theory of Work Outcome 22

3.3.4 Theory of Self-Improvement 23

3.3.5 Theory of Engagement 24

3.4 Theoretical Framework 25

3.5 Hypothesis 27

3.5 Summary of the chapter 29

CHAPTER 4 THE METHODOLOGY 29

4.1 Purpose of the study 29

4.2 Sample selection 30

4.3 Validity and reliability 31

4.4 Summary of the chapter 32

CHAPTER 5 DATA ANALYSIS AND RESULTS 33

5.1 Scale Reliability 33

5.2 Exploratory Factor Analysis (EFA) 34

5.2.1 Independent variables scales 34

5.2.1 Dependent variables scales 36

5.3 Regression Analysis 37

5.4 Assessing normality of the residuals 39

5.4.1 Frequency Histogram: 39

5.4.2 Normal P-P Plot: 40

5.4.3 Scatter plot: 40

5.5 Summary of the chapter 41

CHAPTER 6 IMPLICATIONS AND CONCLUSIONS 42

6.1 Work Outcome 42

6.2 Engagement 42

6.3 Self-improvement 43

6.4 Work Attitude 43

6.5 Limitations of study and future reseacrch 44

6.6 Sumamry of the chapter 45

References 46

Appendix 50

1 Questionnaire 50

2 Statistical Tables 53

LIST OF FIGURES

Figure 1.1 MXV logo 7

Figure 1.2 HCT logo 8

Figure 1.3 HCT’s Certificate of Business registration 10

Figure 1.4 Top 5 of Vietnam Commodity Broker Exchange market share 11

Figure 1.5 Pie chart: The proportion of achieving KPI targets in Q1 12

Figure 1.6 Pie chart: The proportion of reasons for not meeting KPI targets in Q1 13

Figure 5.1 Frequency Histogram 39

Figure 5.2 Normal P-P Plot 40

Figure 5.3 Scatter plot 40

LIST OF TABLES:

Table 5.1 Scale Reliability 33

Table 5.2 Rotated Component Matrix of Independent variables 34

Table 5.3 KMO and Bartlett's Test of Independent variables 35

Table 5.4 KMO and Bartlett's Test of Dependent variables 36

Table 5.5 Total Variance Explained 36

Table 5.6 Summary of Regression model 37

I am also grateful to the following friends and colleagues for their consistent support and assistance during the period since I first started to join the labour market Without them, I definitely did not have a chance to open up my views and philosophy

Finally, last but by no means least; also to everyone in the Banking University,

it was great sharing premises with all of you during last three years

Thanks for all your encouragement!

Abstract

Commodities trading is an ancient profession with a longer history than stock and bond trading Many emergence of civilisations can be directly connected to their capacity to build complex trading networks and facilitate the exchange of commodities

In modern times, commodities are still exchanged throughout the world A commodities exchange refers both to a physical location where the trading of commodities takes place and to legal entities that have been formed in order to enforce the rules for the trading of standardized commodity contracts and related investment products

For the purpose of advance with global economic integration, the Ministry of Industry & Trade published license No 4596/GP-BCT to establish the first Commodity Exchange in Vietnam—Mercantile Exchange of Vietnam—on September 1st, 2010 And Ho Chi Minh Commodity Trading JSC (HCT) is one of the five largest commodity brokering companies which constitutes the trading system in Vietnam

Due to the new existence of this kind of trading, organisations still have to encounter numberous problems, from legal challenges to professional qualification issues This study aims to discover new factors affecting the whole outcome, mainly based on employees‘ work performance at HCT and then hopefully can set the basis for further research in the future

Keywords: Commodity trading, HCT, work performance, proper solutions

CHAPTER 1 OVERVIEW OF COMMODITIES TRADING

1.1 Definition

According to Adam Hayes (Ph.D., CFA and a financial writer with 15+ years Wall Street experience as a derivatives trader), a commodity market is a marketplace for buying, selling, and trading raw materials or primary products

Commodities are often split into two broad categories: hard and soft commodities Hard commodities include natural resources that must be mined or extracted—such as gold, rubber, and oil, whereas soft commodities are agricultural products or livestock—such as corn, wheat, coffee, sugar, soybeans, and pork

1.2 How Commodity Markets Work

Commodity markets provide producers and consumers with access to commodity products in a centralised and liquid marketplace These market actors can also use commodities derivatives to hedge future consumption or production Speculators, investors, and arbitrageurs also play an active role in these markets

Certain commodities, such as precious metals, have been regarded to be an effective inflation hedge, and diversifying a portfolio with a diverse range of commodities as an alternative asset class can assist Because commodity prices tend to fluctuate in opposition to stock prices, some investors rely on commodities during moments of market instability

In the past, commodities trading required significant amounts of time, money, and expertise, and was primarily limited to professional traders Today, there are more options for participating in the commodity markets

1.3 History of Commodity Markets

Commodities trading dates back to the birth of human civilization, when tribal clans and newly established kingdoms would barter and trade for food, supplies, and other products Trading commodities indeed precedes the trading of stocks and bonds

by millennia The growth of empires such as ancient Greece and Rome can be directly

related to their capacity to construct complex commercial networks and promote commodity exchange across enormous areas via routes such as the legendary Silk Road, which linked Europe to the Far East

Today, commodities are still traded on a vast basis all over the world With the introduction of exchanges and derivatives markets, things have also gotten more complicated Futhermore, many exchanges are regulated and standardized by governments, which provide legal, liquid and efficient marketplaces

Perhaps the most influential modern commodities market is the Chicago Board

of Trade (CBOT), established in 1848, where it originally traded only agricultural commodities such as wheat, corn, and soybeans in order to help farmers and commodity consumers manage risks by removing price uncertainty from those agricultural products Today, it lists options and futures contracts on a wide range of products including gold, silver, U.S Treasury bonds, and energy products The Chicago Mercantile Exchange (CME) Group merged with the Chicago Board of Trade (CBOT) in 2007, adding interest rates and equity index products to the group's existing product agricultural offerings

1.4 Types of Commodity Markets

Generally speaking, commodities trade either in spot markets or derivatives markets Spot markets, sometimes known as "physical markets" or "cash markets," are places where buyers and sellers trade real items for immediate delivery

Derivatives markets involve forwards, futures, and options Forwards and futures are derivatives contracts in which the underlying asset is the spot market These are contracts that grant the owner control of the underlying at some time in the future

in exchange for a predetermined price today Physical delivery of the commodity or other item would take occur only after the contracts expired, and traders frequently roll over or close out their contracts to avoid making or taking delivery entirely Forwards and futures are similar in many ways, although forwards are more customisable and

sold over-the-counter (OTC), whereas futures are standardized and traded on exchanges

*Note: Commodities are predominantly traded electronically; however, several U.S exchanges still use the open outcry method Commodity trading conducted outside the operation of the exchanges is referred to as the over-the-counter (OTC) market

1.5 Commodity Market Trading vs Stock Trading

For most individual investors, accessing commodities markets, whether spot or derivatives, is untenable Direct access to these markets typically requires a special brokerage account and/or certain permissions Because commodities are considered an alternative asset class, pooled funds that traded commodities futures, such as CTAs, typically only allow accredited investors Still, ordinary investors can gain indirect access to commodities via the stock market itself Stocks on mining or materials companies tend to be correlated with commodities prices, and there are various ETFs now that track various commodities or commodities indexes

These ETFs can help investors diversify their portfolios, but for most long-term investors, stocks and bonds will be the foundation of their holdings Furthermore, because commodity prices are more volatile than those of stocks and bonds, commodity trading is frequently best suited for people with a higher risk tolerance and/or a longer time horizon

1.6 Commodities trading in the world

Trading exchanges were founded nearly 400 years ago, with the first one formed

in Amsterdam in 1602 to trade shares of the Dutch East India Company Today, the globe has over 60 major exchanges, with 16 having market capitalizations of more than

$1 trillion apiece, accounting for 87 percent of worldwide market capitalisation as of

2016 They have made trading a viable career and boosted market transparency and efficiency by embracing technology improvements

Along with advancing technology, entry barriers have also eased in recent years, making these exchanges dynamic The emerging markets have also made their mark on the global economy The smooth functioning of these exchanges is critical for global economic stability

Here is a list of the 7 biggest stock exchanges, according to their market cap as

of November 2018, as well as the top 3 global commodities exchanges by market cap – according to Blackwell Global

1 Chicago Mercantile Exchange (CME Group)

Founded in 1898, as Chicago Butter and Egg Board, the CME has the widest range of options and futures contracts in the world These include contracts of all kinds, from agriculture to energy and equity indexes

2 Tokyo Commodity Exchange

Established in 1984, This is Asia‘s primary commodities exchange and is also known as TOCOM TOCOM includes futures and options in precious metals, rubber, oil and soft commodities Its current trading platform is based on NASDAQ OMX technology

3 London Metal Exchange

The London Metal Exchange traces its roots back to 1571, when the Royal Exchange was involved only in copper contracts Today, some of the major metals like aluminium, zinc, lead and nickel are traded through options and futures here Apart from base metals, it has other commodities as well It offers hedging as well as options

of physical deliveries to settle contracts

1.7 Commodities trading in Vietnam

Mercantile Exchange of Vietnam (MXV) is the only national centralized commodity trading market organizer in Vietnam, licensed by the Ministry of Industry

& Trade (the only and indefinite license managed by the Ministry of Industry &

Trade) For example: No 4596/GP-BCT in 2010, No 51/2018/ND-CP and No 486/GP-BCT in 2018, No 1369/QD-BCT in 2020

Figure 1.1 MXV logo

Currently, MXV has connected most of the major Commodity Exchanges in the world such as: London Metal Exchange - (LME); Chicago Commodity Exchange - CME Group (including CBOT, CME, COMEX, NYMEX Exchanges); Intercontinental Exchange - ICE (including ICE US, ICE EU, ICE Singapore exchanges); Osaka Commodity Exchange - OSE; Singapore Commodity Exchange - SGX; Bursa Malaysia Derivatives Exchange

MXV satisfies all commodities trading demands of domestic investors, including price hedging and arbitrage trading, steadily growing the size of centralized trading of domestic investors and contributing to the process of international economic integration

1.8 Summary of the chapter

A commodities market involves the purchase, sale, or exchange of a raw product such as oil, gold, or coffee Hard commodities are primarily natural resources, whereas soft commodities are animals or agricultural items Spot commodity markets include

immediate delivery, whereas derivatives markets involve future delivery Investors can obtain exposure to commodities through investing in firms with commodity exposure

or by investing in commodities directly through futures contracts

CHAPTER 2 INTRODUCTION

2.1 Problem Formulation

As the development of commodity trading exchange in Vietnam is expected to provide an alternative for investors when they find difficulties investing in risky assets such as stock and real estate, the human resources to serve in this field become more and more important This will lead to a huge contribution of Vietnam economy based

on the potential growth of liquidity and also determine the success of international integration According to the Mercantile Exchange of Vietnam (MXV), the commodity market is still immature since it was initially established on June 1, 2018 by Decree 51/2018/ND-CP So that employees such as financial advisor, marketer play a very significant role to build up a strong and sustainable community of investors

According the vision and mission of Ho Chi Minh Commodities Trading Jsc (HCT), by the end of 2023, the company will prepare for an initial public offering (IPO) on Ho Chi Minh Stock Exchange (HOSE) for fund expansion to reach the ambition of top 1 commodities market share in Vietnam

Figure 2.2 HCT logo

Howerver, to meet these IPO requirements, the company must comply with Securities Law 2019 and Decision No.85/QD-SGDHCM Dated March 19, 2018

Promulgating Regulations On Listing Of Securities On Ho Chi Minh Stock Exchange This can be financially summarized as follows:

- Charter capital: the amount of charter capital contributed at the time of registration of the offering is greater than or equal to 120 billion VND calculated on the audit report

- Years of operation: The company has operated for at least 02 years in the form

of a Joint Stock Company up to the time of registration for listing

- Financial situation and business activities: ROE of the previous year at least 5%

; 2 consecutive years of profit; no debt overdue for more than 1 year; no commulative loss

From the date of establishment of the company, HCT has already qualified for the charter capital of 150 billion VND The main goal is to keep ROE constantly at least 5% in 2022 to complete 2 consecutive years in profit (As in 2021, the company succesfully hit the revenue record of 42 billion VND, equivalent 15.2% of ROE)

Figure 3.3 HCT’s Certificate of Business registration

But in Quarter 1 of 2022, the company saw a decline in ROE down to 6% due to the revenue loss This can be answered by employees‘ poor work performance since approximately 32% of the staff did not meet the sales KPIs Considering this problem, the research is conducted to study more about this phenominon and then provide effective solutions for the company to reach the IPO event by the end of 2022

To provide more testimonies for the research, all of the employees of Ho Chi Minh Commodities Trading Jsc (HCT) is individually chosen to study factors affecting work performance which is definitely one of the reasons constitutes the HCT‘s domination of market share when it is expected to take over Gia Cat Loi in 2022 The high quality human resource is reportedly the main driving force to keep HCT growing and succeding from 2019 to 2021

Figure 1.3 Top 5 of Vietnam Commodity Broker Exchange market share

Human resource development is a way to help businesses improve productivity, quality and efficiency of work and also improve the physical, intellectual and moral aspect of employees

In this day and age, Vietnamese enterprises are not truly involved in developing human resources in a comprehensive way and not considering the development of human resources as an investment for the future At Ho Chi Minh Commodities Trading Jsc, despite its effort in developing human resources, the company still has some limitations to reach the full potential work performance of employees Therefore, the topic " Factors Affecting Work Performance At Ho Chi Minh Commodities

Trading Jsc (HCT)" is aimed to find out the optimal solutions to boost the labour force

to its best

In an internal survey at HCT, there are 3 main reasons account for poor work performance of 40 % people in Q1/2022 which are heavy workload, lack of motivation and frustration over obstacles All of these agents are strongly correlated based on Human Resources Management theories In this research, we will elaborate and find out an antidote for HCT‘s labour force

Figure 1.4 Pie chart: The proportion of achieving KPI targets in Q1

53,30%

36%

10,70%

The proportion of achieving KPI targets in Q1

Meet the KPI targets Fail to meet the KPI targets Exceed the KPI targets

Figure 1.5 Pie chart: The proportion of reasons for not meeting KPI targets in Q1

- The final result should be considered thoroughly to propose an appropriate human resource management solution for managers as well as employees themselves

Here are some problems need to be answer in order to obtain the final result of this study:

1 Which factors have the most powerful impact to employees‘ work performance

3 What mistakes could leaders make when managing the workplace that negatively affects their staff ?

4 What is the optimal solution to develop employees‘ performance till now, specifically in this new commodity field ?

** Because this topic is still in progress of the growth of modern behavioural theories, we expect our research in the early stage can be the basis for many researches’ expansion in the future

2.3 Scope of the study

- Employees and managers at Ho Chi Minh Commodities Trading Jsc including Ho Chi Minh City representative office and Ha Noi head quarter office

- Time range from 2018 to 2022

2.4 Outline of the study

~ Chapter 1: Overview Of Commodities Trading

The first chapter of this study provides some very fundamental knowlegde of the field mentioned in this topic Compared to several traditinonal financial markets, commodity market is almost new and not yet discovered properly in Vietnam, although

it has a very long history, even longer than equity market‘s one Also, because of the unprecedented fact that Vietnamese commodites trading system is still immature, there are also Opportunities and Challenges Opportunities is that this thesis may contribute

as one of groundwork for many larger research conducted Challenges is that the lack

of previous academic studies may lead this thesis to drift wrong direction and poor in relevant experiences

~ Chapter 2: Introduction

The second chapter consists of a problem background where the research topic,

―FACTORS AFFECTING WORK PERFORMANCE‖ predicted employees‘s performance, and its theoretical background is discussed; a problem formulation where the practical aspects and specific direction of this thesis is revealed; a research purpose that explains the objectives of the research and introduces the research question; a delimitation that recognises the boundaries to the research; a list of objective needed to

be attain in the topic; and a disposition of the thesis as a whole

~ Chapter 3 Literature Review

The chapter includes definitions and theoretical framework further information about the relevant theories of this thesis Firstly, a review of literature about basic Human Resource Management terms will be produced Secondly, the theories Compliance, Work Attitude, Work Outcome and Motivation will be explained and discussed with a review of recent literature, which are the precursors to create a proper model for Work Performance at HCT JSC I will also discuss the different methods of calculating the collected data, both Primary data and Secondary data, since these factors can influence the models‘ results Assumptions will be derived from the theory and presented in this chapter, which will be used to construct solutions in chapter 6

~ Chapter 4 The Methodology

The practical method follows the theoretical chapter because it describes how the author will analyze the assumptions gained from theory by developing hypotheses

As a result, the hypotheses will be introduced in this chapter, as will the population, sample, and time horizon, as well as the variables and statistical tests to be calculated The data collection process, as well as a critique of the data sources and the quality of the results, will be discussed

~ Chapter 5 Data Analysis And Results

The findings will be reported in this chapter using descriptive statistics, graphs, and tables The findings of the statistical tests will also be produced and discussed

The analysis will examine the results and give interpretations of them Also, the hypotheses will be tested using statistical evidence

~ Chapter 6 Implications And Conclusions

The conclusion will demonstrate a summary of the thesis and its contribution to new knowledge, address research questions, and suggest additional research on the thesis topic More over, I am delighted and passionate to deliver some proper consultations for HCT to boost up their capacity and instrinsic competitive advantages

2.7 Summary of the chapter

The chapter 2 covers the main problem why this research is conducted Readers are provided with a big picture of what HCT JSC is going through and what challenges they are encountering Thereby, the chapter demonstrate an outline that recognizes the boundaries of the research, a problem formulation that reveals the practical implications and specific direction of the thesis, a research purpose that explains the objectives of the study and poses the research question, a delimitation that identifies the goals for the study as a whole, and a thesis disposition

CHAPTER 3 LITERATURE REVIEW

3.1 Definitions

3.1.1 Employees

According to Susan Heathfield (Management and Organization Development Consultant, Co-Owner - TechSmith Corporation), an employee is an individual who was hired by an employer to do a specific job The employee is hired by the employer after an application and interview process results in his or her selection as an employee This selection occurs after the applicant is found by the employer to be the most qualified of their applicants to do the job for which they are hiring

Additional factors that make someone an employee include:

 The person is on the company's payroll and receives a specific salary or wage

 The individual is eligible for benefits and other perks offered by the employer

 A written or implied contract of employment

 The person is protected by law in terms of wages and employment rights

3.1.2 Work performnace

According to Motowidlo (2003), job performance is defined as the total expected value to the organization of the discrete behavioral episodes that an individual carries out over a specified time period Those researchers emphasize two key issues in this definition First, performance is an aggregated property of multiple, discrete behaviors that occur over time Second, the property of behavior to which performance refers is its expected value to the organization

Two performance criteria – mean performance and performance variation – are among the most commonly studied indicators in pay-for-performance research According to Reb and Cropanzano (2007), average performance evens out employee's

contribution to an organization Average performance evens out variations from the mean that might be due to passing influences outside the control of the employee

3.2 Previous research

Following this rationale, previous study discovered that average performance highly predicts variance in pay and incentive allocation (Barnes and Morgeson, 2007; Zhou and Martocchio, 2001), owing to the fact that normal, or average, performance is the dominant conceptualization of performance (Rushton et al., 1981) In the context of pay-for-performance, it is very logical to anticipate that higher mean performance will result in positive changes in compensation level

Performance variation also plays a role in compensation award decisions According to Sturman (2007), unsystematic performance variance and short-term fluctuations are two different things Long-term or directional changes over time are the former Affective state is one of the reasons for within-person performance difference (Weiss and Cropanzano, 1996) Some people may perform with a lot of variation, which means they are inconsistent, while others may perform with little variation, which means they regularly perform at or around the mean level or a long-term trend

According to Barnes et al (2012), there are various reasons to assume that performance variance of a greater size is related with smaller compensation Employees with lower levels of performance variability are, by definition, easier to forecast than those with higher levels of variability Predictability is frequently valued

by businesses It can be challenging to plan and operate interactively when employees' irregular performance causes uncertainty and disruptions for the team and other parties reliant on the person This increases the possibility of poor performance, coordination issues, and interruptions of work for other employees who are reliant on the person in question

3.3 Theoretical Basis

3.3.1 Theory of Compliance

The pillar of contemporary civilization is compliance From urban planning to company management, every facet of contemporary life need the observance of specific standards in order to preserve societal order Businesses, like residential zoning rules, must develop a compliance program, educate employees about what they can and cannot do, and establish punishments for violations In both cases, the active participation and abidance of individual members is mandatory to make the program work This concept was recognized by the United States Office of Inspector General (OIG) under ―compliance as an element of employee performance‖ (Nicole, 2000) The implication is that the employee's performance should be based on their ability to comprehend, participate in, and adhere to the company's compliance program's demands The answer to the issue of what "compliance" entails is a mixed bag Rules, regulations, policies, processes, and procedures are all examples of compliance Johnson & Johnson is an example of a global corporation whose rules and laws contribute to its profitability The corporation explicitly defines what is acceptable and what is not in its Policy Business Conduct on a variety of fronts, including antitrust laws, environmental regulations, healthcare, labor rules, and security laws, among others

The primary goal of workplace compliance is to limit hazards, particularly in organizations where employees are exposed to jobs with high financial risks Financial institution, where personnel are taught in safe methods to prevent industrial accidents, are the most typical place where rigorous compliance is observed Employee comprehension and compliance with processes are vital in those businesses As a commodity trading company, HCT is not an exception Diaz and Resnick (2000) identified several factors that may affect employees‘ willingness to comply, such as

incentive system to reward compliance, managerial commitment to financial safety, primary goals set forth by managers and individual perception of safety

3.3.2 Theory of Work Attitude

Because attitude is considered a subjective characteristic, economists have been cautious to recognise the relationship between attitude and performance However, as Freeman demonstrated in his National Longitudinal Survey (1966-71) and Michigan Quality of Work Survey, employee attitude may have a major economical influence on

a firm (1972-73) Numerous empirical investigations have proven a link between attitude and performance since Freeman lay the groundwork for a shift in how we regard attitude as a variable in performance

The relationship between employee attitude and workplace performance has been the subject of extensive research in organizational behavior at a time when human capital is regarded one of the most significant resources for corporate success (Weiss and Cropanzano, 1996) Although attitude is a broad psychological term, we will concentrate on the job satisfaction element of work attitude in this research

In the late 20th century, organizational behavior research on work satisfaction arose and evolved quickly Locke (1976) defined job satisfaction as "a pleasurable or positive emotional state resulting from the appraisal of one's job or job experiences" in his Range of Affect Theory (Locke, 1976, p 1300) He recognized affect (emotions) and cognition as two interrelated components of work satisfaction (thoughts) Locke's discovery implies that our thoughts impact our emotions, and our emotions influence our thinking The importance of both sides of this interlocking connection for performance development cannot be overstated This is a step forward from the traditional management strategy, which focuses solely on regulating external elements like as the working environment and compensation system Since the early 20th

such as cultural background and emotional state impact an employee's job happiness Indeed, Staw and Ross (1985) were among the first to argue that the level of satisfaction of a person is stable over time regardless of situational changes in position, job and company Hofstede (1980, 1985) found the importance of culture in shaping employee attitudes According to Hofstede, the main dimensions of culture that affect attitudes are (1) individualism — collectivism; (2) uncertainty avoidance versus risk taking; (3) power distance and (4) masculinity / femininity This was among a large body of research done in the last twenty years that emphasizes the dispositional source

of job satisfaction (Arvey and Bouchard et al., 1989; House and Shane et al., 1996).Some studies have looked at the psychological elements that contribute to job satisfaction in an attempt to understand the dispositional reasons of job satisfaction (Erez, 1994, Weiss &Cropanzano, 1996) Judge and his colleagues discovered that core self-evaluation, the personality feature that has the greatest impact on job satisfaction,

is connected to the employee's own view of the job (Judge & Bono, 2001, p 80) The disadvantage of such research is that they generally show correlations rather than causal relationships, leaving them with little explanatory value for how personal variables impact performance in the future Nonetheless, while analyzing job happiness, they focus our attention to not just environmental but also dispositional or personal elements

The question here is how organizations may alter personal factors in order to improve work happiness One strategy to boost satisfaction, according to Saari and Judge (2004), is to pick the appropriate people and place them in the proper places This isn't to argue that situational impact shouldn't be considered On the contrary, the nature of the job has a significant impact on employee satisfaction (Judge and Church, 2000; Jurgensen, 1978) As a result, improving situational elements by making work more exciting, difficult, and rewarding should be the first step in adjusting work-attitude-oriented management

3.3.3 Theory of Work Outcome

Many studies have attempted to establish a theoretical framework for evaluating work outcomes Financial, organizational, and human-resource-related (HR-related) effects were discovered by Dyer and Reeves (1995) Revenues, earnings, and return on investment are financial results; product and service quality, innovation, and effectiveness are organizational outcomes; and employee attitudes and behavior are HR-related outcomes Collins, Ericksen, and Allen (2005) looked at a variety of theories to see how Human Resource Management (HRM) affects employee outcomes, which affects operational and/or financial performance They identified five different categories of employee outcomes and how they affect corporate performance:

 Commitment to supervisor

 Trust in management

 Cooperation with others and being cooperative

 Effort and involvement

 Turnover intentions

According to the study, organizations with strong financial development have high staff effort and participation, as well as low employee turnover rates The latter has also been shown to provide a competitive advantage Customers are another key set

of stakeholders Also according to study, organizations with great customer satisfaction have employees that have high dedication to superiors, strong faith in management, and a cooperative mentality Furthermore, strong management trust is linked to excellent product/service quality and new product development

The employee-supervisor connection is essential because it underpins two of the five employee outcomes identified by Collins, Ericksen, and Allen (2005) in their research: dedication to supervisor and trust in management We may use Emerson's power dependency theory (1962) to describe the nature of this mutually advantageous

connection with a hierarchy since it is mutually beneficial Emerson's theory is based

on the idea that power is based on one party's capacity to control what the other values When this idea is applied to business, it indicates that employees are reliant on their boss when the boss has the power to provide them what they want, such as concrete and intangible rewards (Emerson,1976; Casciaro and Piskorski, 2005) Employees will

be driven to continue their efforts as a way of obtaining additional incentives if they believe the prizes are an appropriate acknowledgment of and fair remuneration for their outstanding performance Many studies have identified a link between supervisory incentives and employee productivity, performance, and satisfaction (Simon, 1976; Hunt and Osborn et al., 1981)

3.3.4 Theory of Self-Improvement

In this study, we also approach the topic of improvement from a self-evaluation perspective Self-evaluation refers to the manner in which the self-concept is socially negotiated or modified (Sedikides & Gregg, 2003; Sedikides & Strube, 1997) It refers

to the interplay between the individual and the social world And it is concerned with issues such as: What kind of feedback do individuals want? How do they go about selecting the feedback they want? How well do they remember the feedback? How does the feedback make them feel? How do they respond to the feedback they receive?

The motive of self-improvement (Sedikides, 1999; Sedikides & Strube, 1995) is

an approach motive (Elliot & Mapes, 2005) It refers to the desire for feedback with improvement potential, henceforth called ‗improvement-oriented feedback‘ Such feedback may provide tips on how one can accelerate progression toward a current goal

or it may simply indicate that one is progressing well toward a current goal Improvementoriented feedback includes factual input, critical and useful suggestions, constructive advice, upward social comparisons, and information that follows an upward trajectory or permits temporal comparisons that convey progress The objective

of this article is to map out the conceptual and empirical territory on self-improvement motive and social or evaluative feedback We begin by asking whether and how the self-improvement motive is reflected in conscious desire or naturalistic discourse We then turn our attention to the regulation of the self-improvement motive How do people negotiate their preferences for improvement-oriented feedback with interpersonal or intrapersonal constraints? In particular, we examine whether and under what circumstances individuals prefer improvement-oriented feedback Next, we discuss how well and under what circumstances individuals recall improvement-oriented feedback Subsequently, we thrash out affective and performance consequences of improvement-oriented feedback In the process, we will look at the interplay between self-improvement and other self-evaluation motives (e.g., self-protection, self-enhancement, self-assessment; Sedikides & Strube, 1997), where applicable

3.3.5 Theory of Engagement

Employee engagement is an important concept to organizational leaders and employees alike This paper, through the review of definitions, theories, antecedents and outcomes of employee engagement, highlighted what the body of research has indicated on the topic of employee engagement Employee engagement usually refers to employees‘ physical, ognitive and emotional input in the work Needs-Satisfaction framework, Job Demands-Resources model and Social Exchange Theory have been used to explain varying levels of employee engagement in the organizations According to Needs-Satisfaction framework, employees‘ sense of meaningfulness of work elements, job security and the availability of personal resources determine their engagement in role performances According to JD-R model, high-levels of job-related and personal resources can reduce the exhaustion and other negative outcomes caused by job demands which require employees to pay

additional efforts According to social exchange theory, relationships between employees and employers are based on norms of reciprocity When employees feel that they are being treated well and valued by their employer, they are more likely to respond by exerting effort on behalf of the employer in the form of raised levels of engagement (Alfes et al.,2013a).With regard to variables related to employee engagement, antecedent variables mainly include three categories: organizational factors, job actors and individual factors, and outcome variables are mainly focused

on individual performance and organizational performance

3.4 Theoretical Framework

This study presents a paradigm for determining the link between employee

performance and compliance, work attitude, work outcome, self-improvement, and engagement in HCT

To overcome problems and accomplish strategic goals, any firm must use all available resources Fixed assets, current assets, and intangibles such as social capital and human capital are among the resources supplied to a business In a time of fierce market competition and globally unstable environmental conditions, it is critical for businesses and organizations to make full use of all of their resources to gain a competitive advantage, particularly human resources, which have been acknowledged

to be a long-term factor that can be improved with proper management It is critical for manager to devise a method for building employee capability and motivating them to grow Companies should also have a feedback mechanism to evaluate staff performance and alter strategy as required

In modern businesses, analyzing employee performance records is an integral component of operations The most popular method is for managers to conduct annual reviews of individual employees Managers and staff will discuss the feedback received from those reviews before signing off on it Assessing employees' effectiveness on the job, matching the organization's goals with individual goals, and

addressing employees' needs in order to retain talent are all components of performance management The goal of performance management is to make sure that the majority of human capital is appreciated and oriented toward achieving company goals Despite its importance, many managers are unaware of the function of this process in achieving higher levels of performance It is pivotal for a business owner or manager to grasp the fundamentals of "performance" and how to evaluate personnel based on their performance

A systematic performance-management program helps managers and workers agree on objectives, goals, and career progression, as well as how an individual's work fits into the larger vision of the firm In general, performance management considers people in the context of the larger workplace system In theory, you pursue the absolute performance standard, which is thought to be unreachable

Traditional strategies for performance management include developing and assessing goals, objectives, and milestones They also want to define what successful performance looks like and create mechanisms for measuring it Instead of the old paradigm of year-end reviews, performance management considers every encounter with an employee as an opportunity to learn

For example, managers can utilize performance management systems to change workflow, offer new courses of action, and make other decisions that will assist staff in meeting their goals As a result, the organization is able to meet its objectives and execute optimally For example, the management of a sales department may assign revenue targets to employees that must be met within a certain time frame Along with the figures, the manager would provide suggestions to assist the salesmen succeed in a performance management system

Focusing on continuous accountability creates a healthier, more transparent work environment, and emphasis on regular meetings can improve overall communications Everyone is more aware of the expectations because performance