Management Capability In Van Hung Suan Company.pdf

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Nguyen Thi Duyen Anh MANAGEMENT CAPABILITY IN VAN HUNG XUAN COMPANY MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – Year[.]

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Nguyen Thi Duyen Anh

MANAGEMENT CAPABILITY

IN VAN HUNG XUAN COMPANY

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – Year 2019

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Nguyen Thi Duyen Anh

POOR MANAGEMENT CAPABILITY

IN VAN HUNG XUAN COMPANY

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: Dr Tran Phuong Thao

Ho Chi Minh City – Year of 2019

1.3.1.3

1.3.2

Lack of sales and marketing team

Main problem validation

24

25

Define business component 33

Executive summary

Vietnam is a country that has gradually been drawing to foreign investors as one of prospective destinations in Asian region It is attracted for the young people who want to start-up the company in the integrated phase Van Hung Xuan company is established in following towards the growth of industrialized and modernized country and it has been improving to reach the achievement of the high performance However, the most difficult for young company as Van Hung Xuan has been facing in the case of employees leave the job High leavers in company is considered as the initial problem in the company In order

to follow that, company will find some causes to understand what factors with regard to employees want to stay or leave their jobs

The analyzed methodology used to find out the causes and effects leading to

recognize the potential problem in the thesis that is qualitative data collection method through in-depth interviews as primary data Additional, the secondary data is collected materials of leavers from office department to have diagnosis of potential problem at Van Hung Xuan Company Moreover, problem scope can work with office department,

teaching and translating departments in company in which it is typically analyzed data on

translating function to find out the potential reasons are come from the diagnosis of

highest turnover rate and the issues are supported to understand what roost causes leading

to difficulties that has been happened in company

From the finding out diagnosis of potential problems exist in Van Hung Xuan Company, findings provide the existence of poor management capability plays a main problem The scope of problems is argued with evidences for providing through

interviews from qualitative method Poor management capability is analyzed in terms of its existence, consequences and solution are suggested to resolve such a problem Finally, this thesis will indicate the action plan in the time and budget that are proposed to settle the problem aiming to reduce the obstacles in Translating function in Van Hung Xuan Company

CHAPTER 1 PROBLEM IDENTIFICATION 1.1 Problem context

1.1.1 Introduction the company

Company Van Hung Xuan has established in 2011 with tax code: 0310832022, its

head office is located at 274 Le Co, An Lac Ward, Binh Tan District, HCM, Vietnam and

it owns 01 branch in Binh Tan District as well It is represented by Mr Nguyen Van Duc

by law with two billion for charter capital It started up with 04 employees and peak of

2015 and 2016 with 16 employees who was working in Van Hung Xuan company

including in head office and 01 branch in HCMC, Vietnam

The company provides the teaching languages and translating services for

companies, there are two main segments: corporate customers and individual customers

With the strategy to expand the market, Van Hung Xuan will have a plan to promote the

network of clients for translating and teaching languages functions from 2019, it creates

of a huge human source to run this business plan

Figure 1 Van Hung Xuan Company organizational structure

In Van Hung Xuan Company, there are Head office and Branch with core

functions: there are 01 office department including in Accounting department, 01

translating department and teaching department In teaching languages functions, they are

divided into 2 small divisions: teaching Vietnamese for foreigners and teaching English

for children in head office and in branch in which the translating business is playing the

key role in company

Teaching languages Department

Teaching languages Department Department

1.2.2 Symptoms

The translating function is born in 2011 and it has been playing the via role in business operation in Van Hung Xuan Company It was difficult to recruit and keep the talent employees who could follow the high requirements from clients in the first phase There were only 04 employees including in 01 managers cum translator, 01 Chief

Accountant cum translator who has managed the general affairs, 02 translators

From the phases of 2011 to 2013, the internal materials are reported that the

number of employees has not changed and the revenues of translating function has gained from 180.000.000 vnd to 225.000.000 vnd for each year The two main languages of English and Chinese has been serviced to target of individual customers and corporate ones The beginning of 2014, manager has planned to recruit the 04 additional new

employees to service for the number of clients and they have kept the job until the end of

2016 The peak of 2017, the translating business operation has been downturn leading to lacking to source job to assign among employees means that translating function has faced the employees who want to leave the job with many reasons in relating to salary and benefits, weak source of clients, and weak management

On the basis of internal materials are shown from Office department, the number

of employees who left the company has been increasing in 2017 The below table is

shown the number of employees who quitted their jobs are more significant in 2017:

Table 1: Number of employees in Translating Function in Van Hung Xuan company

Total of employees Left

Total of employees Left

Total of employe Left

Total of employees Left

Total of employees Left

As above table of employees at company from 2011-2018, the number of

employees leaving continued toward increasing from 2017 However, the other positions still keep their jobs and unchanged The turnover rate is shown in below:

Graph 1: Turnover rate of employees in Van Hung Xuan Company from 2011-2018

As above mentioned, Van Hung Xuan company has faced the problems in relating

to high turnover rate of staffs in which translating functions reached to 63% in 2017 and it seems difficult for company to seek the potential clients as well as the talent employees who will be dedicate their competences into the growth of business In this function, high turnover rate of leavers has significantly affected to the negative attitude of current

employees and their job performance Moreover, the high of leavers are also affected too much to revenue of company as reported materials from human resource department Especially, the revenue of company has fallen sharply in 2017 that has started from losses

of potential clients leading to poor source of assigned job among employees In a result, it

is said that the correlation between turnover rate and low revenue are affecting to sharply growth of business operation in company

From the internal documents are provided to present the revenues in translating Function from 2014 – 2018 in below:

Graph 2 Revenues in Translating functions in Van Hung Xuan Company

In summary, the symptoms are found in Van Hung Xuan Company including in Decrease Revenues and High turn overate of leavers

1.2 Problem analysis

1.2.1 Situation analysis

According to the data is collected from in-depth interviews from 02 groups:

Managers and the persons who left the job in company

Assigned Multitasks

As the writer can see that there are many reasons leading to increasing number of employees who want to leave their job The interviews are performed to taking over the most importance of business operation to investigate the symptoms and incisive

judgement to the problem occurring in company The content of interviews is shown in Appendix

To get information from employees’ interviews to know that translating function has to fulfill business core requirement from clients and prioritize some of requests while taking over all Facing to high turnover rate as a symptom is found priority in company The leavers left some tasks and current employees who are trying to be in charge of multitask while waiting for take over the new vacancies It seems difficult for company to

306,000 313,200

219,600

118,800

68,400 37,800

73,800 79,200

34,200

5,700

50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000

recruit new ones in this time because of downturn business significantly means that

company does not have much budget to recruiting plan in last recent years The taking of multitasks in company causes of stressful workload for them in the peak of translating season Before the situation of business operation has been declining sharply, Van Hung Xuan company’s managers has had the plan to get back its business operation in

promoting the network of translating from 2019 Ho Chi Minh City – Year of 2018r

Stressful workload

Moreover, the employees who take charge of translating service insisted that dealing with their clients ‘awareness is not easy They always answer all of questions from clients while completing the assignments to summit to Justice Department or Notary Public’s office to screen the documents and go back handing in the clients in time when being request about the time and date, they do not have enough time for preparation for documents perfectly They are always in stressful state with time pressure and these causes may be known as a passive involvement in translating function This is one of reasons employees tended to reject new tasks are taken over from the leavers because they feel the negative impact on their assignments

Mr Tuan Dung – employee at HR department of translator function – who left the job approximately 1 years, 28 years old He shared some views the reason leading to quit

working in company that “the salary plays the most important role in decision to work or

leave the job I feel unpaying in salary and high pressure of time and working.”

Mr Dung continuously shared the point of views: “the job was repeating and

repeating day by day leading to me tend to undeveloped in my personal career I always felt bored when completing a repeated list of assignments in my daily work”

As above details mentioned, company does not have the HR plan leading to weak compensation in relating to unsatisfied job among employees More views are shared

from Ms Thanh Hong that “Van Hung Xuan company is very young means that it has

faced to lacking of clients in developing and growth of company The company does not have much potential clients leading to lacking of sources of jobs that allocate among employees that makes to low income I think the root cause for weak potential clients that

is lacking of marketing and advertisment strategy and weak management skill in keep and have more new clients as well as keep the talent persons”

On the basis of Manager in translating functions shared the ideas that recently the company faced the biggest problem of very high turnover rate of 63% in 2017 From 2017 and the 06 first months of 2018, company has been faced forwardly the difficulties since the experienced employees decided to leave while company still cannot recruit the new ones to replace in time to catch the working pace As above noted, Van Hung Xuan

company is a small and young one that always requires all of employees to satisfy all customers’ requirement perfectly Especially for translating function, once people left the company, it means that knowledge with them would leave the company as well As a result, the experienced employees who still keep the job, will handle a lot of tasks in case the company is hard to find out the suitable candidate for the translating vacancy

Ms Thanh Hong also shared point of view: “The big problems it is assigned many

mulittasks with unclear desciption I fell boring with repeating tasks Somtime, I should work with overload but sometime I do not have job to do and always feel boring about the job I feel lacking of motivation to dedicate in assigned job and have a poor

performances Even if, I have weak management of time to complete to multitasks leading

to job stress under work overload in the peak of translating season as well That is why I wanted to quit the job” Additionally, the current business operation of Van Hung Xuan

company, it currently does not have the plan for hiring more employees because of

downturn business This is one of reasons that has negatively impacted to the quality of work leading to poor performance from the lacking of employees because the unstable workload and the company sometime does not have enough human resources for

completing the tasks in the peak of translating business season that makes managers assign multitasks to employees As a result, it has created the lacking of motivation

among employees and the boring and repeating job that make them feeling no promotion

in their job career from the stressful workload

Moreover, company has been suffering from downturn of business operation

means that it is so difficult in running the overall of company and to meet the satisfy the

requirements from employees, that is why managers’ line let them to leave when they make the decision wan to quitting the job In conjunction to high turnover rate of leavers, the loss profit has happened sharply in 2017 and 06 first months of 2018 and it could have been existed forward in the coming months if the managers do not have some solutions for this function

Unstable workload

The dialogue with Ms Xuan Anh who is manager of translating team, the

information is provided that Van Hung Xuan Company is a small and minimum one It has carried out the start-up of business progress from the phase of 2011 - 2018, it has met lots of obstacles in building the typical industry of translating from the clients to services

and it has been planning to promote the growth of business “Our company is very small,

there is less employees who are currently working here We do not have much source of job and company met lots of obstacles in seeking clients We have had the plan to re-build the company” Ms Phuong Anh – Chief Accountant cum Translator, 33 years old, shared

that “from my view, I think the first reason that leads to employees want to leave the job is

Time pressure Because they must manage the time to do over from the high pressure of times and assigned multitasks.” Another causes come from lacking for promotion in job

They feel boring to work day by day, however, they cannot see the opportunities for their

personal career in relating to stress in job as Ms Phuong Anh continuously said that they

do not see the promotion in their career development path, the assigned job is not clear description leading they take much tasks to complete within a day They need a big time

to resolve these and sometime they are free and nothing to do This causes for the stress

in job

In the urgent times, the employees were assigned to work with the high pressure of times to hand in clients in due date She also provided further information in case she should transfer the translated documents to external agency and paid the high fees for external agency because of lacking employees or she has not had many employees who can translate Multilanguage as requirement of clients Excepting for English and Chinese

as main languages to use in translated business operation, the other languages such as

Thailand, Korean, Spanish, Italian, etc…have been supported from collaborators with high fees Beside the competitive prices among translating agencies making the lack of clients as well This has been leading to lack of capacity and low income for her

translating function In peak season of translating, there were a stressful work load among employees

Poor attractive new customers and weak customers’ relation

Yet, it seems difficult for them from the phase of recruiting and training employees

as well as how to keep the talents who will be dedicated working in company to the phase

of building the strategy of marketing and sale that can find new clients and how to keep the enlarge number of existed clients However, managers cannot have target market to win customers in the strictly competed market nowadays that make decreasing revenue sharply Moreover, up to small company as Van Hung Xuan, marketing and sale

campaign are bigger challenges than ever This is one of possible problem findings can affect to the strategy of expanding to company’s growth in the coming years As speaking

to Ms Xuan Anh: “the company does not have a marketing and sale team This is an

obstacle for us to find the new potential clients” Lacking of marketing and sale

campaign, especially for getting and keeping the clients are considered the most difficult problem in Van Hung Xuan Company The biggest challenges are faced to increase the volume of customers purchase the services while trying to keep the existed clients,

however, Van Hung Xuan Company does not have the social networking as building websites or online social networks such as Linkedin, Facebook, Twister, Intergram or newspapers, etc…Managers only focus on their close relationships to get customers through word mouth or zalo….in relating to weak source of customers and it is difficult for them in catching up the working pace and satisfy all of requirements from clients because they lack of human resources leading to employees who are assigned multitask in peak of translating season Moreover, they do not have enough for budge to hire many employees because of irregular job source and lacking of employees means that they hire part-time job or outsources in peak of translating season cause to high costs and decrease revenue They sometime get lots of job and they do not usually have many jobs to

assigned tasks among employees Ms Xuan Anh who handles the tasks and manage

employees in translating function shared some views that: “We do not have website or

any advertisment online The customers are introduced from relationships or from Justice Department and Notary Public Office as well.”

As a result of this that has belonged to the management skills from the managers and how to have a good strategic management for their company toward the good results

of business or bad ones that will be leading to become also threats to company’s mission Decrease Revenue sharply is caused from weak management skill of managers because Van Hung Xuan company is a young and start-up one, it is lacking of many skills in management They do not know how to keep the existed customers and get the new ones

to have many sources of job Additional, the big barrier of high competitors in translating industry strictly in relating to have competed prices and quality services Competitors has many good advantages in Multilanguage to meet the customers’ need all the times with the best prices and services Moreover, they also have best strategy of marketing and sale

to draw and draw the mass of customers to them means that Van Hung Xuan’s employees become tired in management skill of time when they have tried to complete the multitasks from managers leading to low performances among them, it perhaps creates the poor services as clients’ feedback Ms Xuan Anh continually shared that there were also many causes that employees quit job or move to other organizations, these employees wanted to increase the salary and be promoted faster and faster They were always blamed

unsatisfied in their assigned jobs “The requirement from clients, they are always in the

tired state and not positive to cooperate or deal with clients in negotiating the time and date They have weak communication leading to run out of the energy to deadline with clients I always get complaint feedbacks from clients about the small mistakes in

translating documents leading to clients to return and correct the ones That is why we cannot offer more salary and provide more attractive benefit for them They have the job poor performance” In summary, Van Hung Xuan company is not only lacking of

marketing and sale campaign effectively, but it is also weak in management skill to get and keep clients as well as keep talent and right employees that are one of sources to get

profitable for company The number of clients is shown to see that decrease in volume of customers leading to low revenues in past years

Low benefit & salary

As details mentioned in qualitative method, the salary and benefits policy that keep the key importance in relating to high turnover rate of leavers Based on the report and analysis from Office department, Ms Phuong Anh who is in charge of accounting affairs

in company, she gave a general view as she got the results from Van Hung Xuan

Company that there is not existing the performance appraisal and human resource plan Employees are received salary through the scale of fixed salary in comparison with the average income of labor market The payroll of individual is sent to his/ her in

confidentially that it has described the details of basis salary and benefits, however, it seems happening the compare the salary among them leading to unsatisfied income

From the internal data of the company that will provide the basic evidence to investigate the topic of salary in company The salary statement is shown in below:

Graph 4 Average salary of employees in Translating Function in Van Hung Xuan

Company from 2014-2018 Based on the above result of table, it is mentioned that the scale of salary still is considered as factor of low salary among employees leading to them made decision to leave company

Ms Xuan Anh supported this issue that “they always complain about salary; they

feel unfair in receiving salary They have compared the current salary to the other companies.”

Graph 3 Number of customers in Translating functions in Van Hung Xuan Company

Decrease in work quality

Ms Phuong Anh continually talked to the leavers in translating function The causes come from high pressure of time and tasks, weak management of time leading to high time pressure Some employees were lack of experiences in translating documents from reading comprehensive to translated technique leading to get more mistakes in documents It was also wasting of much times for resolving the problems in urgent time when satisfy the requirements from clients Once the manager gets the passive feedback from clients means that there is a poorly performance of job

Regarding to the experiences of employees in company, the graph is shown in below:

Ord Year/ Position 2016 2017

06 first months of 2018

1

Experiences in Translating Function

Table 2: Experiences of employees in Translating Function from 2016-2018

From the above table, the experiences have existed from 0 to 4 years to happen in company with the only one employee who was 23 years old and young, he has started his career path with zero experiences, that was why almost lacking of experiences However,

He supported to settle the paper work and translating documents in company He had lack

of experiences in paper and translating tasks, however, he tried very much to fulfill the assignment in time On the basis of young age and experiences leads to the mistakes and delaying in assigned tasks that can exist to contribute the poor performance job This is one of causes for high pressure of time and working Ms Phuong Anh, chief accountant,

said that: “he does not have experiences in assigned job and normal happen the mistakes

in assigned tasks, but, he works hard and try to learn”

In conversation with Ms Xuan Anh continuously has been analyzed to get further information for leavers in translating field She mentioned that we do not have human resource plan leading to weak recruitment and selection and the performance appraisal do not exist in company It is hard for her to evaluate the achievement of employees The benefits sometime evaluated on the volume of jobs that gets from clients Beside the salary of translating was quietly low in comparison salary of other jobs that used foreign languages, the employee decided to quit the job after only several years working because

of unfair performance appraisals leading to unsatisfied salary and benefits Moreover, the factor of weak management making employees who always feel lacking of supports from managers and colleagues

In summary, potential causes such as weak management skills, lacking of clients, unsatisfied salary and benefits, etc…are identified and some evidences to support the analysis has to be gathered Moreover, turnover rate of leavers affects negatively to

company with a typical factor finding that is low performance in business operation and decrease revenue comes from the weak management skill and lacking of marketing and sale team leading to business result of company has been decreased sharply over years

1.2.2 Initial Cause – Effect Map:

Firstly, it is understood the Cause and effects Map are used in many industries for many purposes The basic thoery of a Cause and Effects Map aims providing the ways for adjusting the business operation and effecting a chain in the system if specified incidents causes (1) The forming of problem definition typically is a problem mess, it is noticed that by selecting a potential problem and setting tasks with respect to this comes from symptoms, cuases and solution in relating to potential prolem will gather during the initial and orientation phases The diagram presents a causes and effect one in which shows a symtopms that has origined from mess of causes (2)

From interview of group 1, the problem finding is focus on the factor of decrease revenues are focusing on lacking of marketing and sale campaign, weak management and high turnoverate The factors of No opportunities for career path, do not have the

marketing and sale team and do not human resource department come from the interview

of group 2 It is merged two diagrams to understand the issues regarding to the potential problems increase Further information, it is understood that potential problem is selected

to comply with initial cause – effect diagram

A decrease in

Revenue

Lack of Human ResourceTeam

Lack of Sale and Marketing Team

Poor Management Capability

Poor attractive new customers

Big barrier of high competitors

Losing the existing customers Weak customers’ relation Stressful workload

Unstable workload Reduce work quality

Not reward evaluation

External industrial factor

1.2.3 Updated Cause – Effect Map

According to Eden et al (3), the analysis relationship between causes and effets mapping are shown the collected views It is shown the arguments can be related to topic’s relevant from its causes and effects It also seeems examines the optential causes into the smaller and smaller items It is useful for showing relationship between contributed factors

in analyzied topic

Job dissatisfaction

On the basis of the thoery about Human Resource Management, it is defined that one of the ways to draw the keep talened people who desires maintaining their jobs that is good human resources management in organization (4) One organization can keep the competenced workforces who are dedicated working leading to supporting the mission, goal and strategies of business growth If the employees can see the benefits on their dedicaiton, they will feel motivation and try their best to complete assigned tasks However, the vison of career path isnot seen from boring job, they are always in mood of dissatisfaction Job dissatisfaction causes for poor job performance and leading to quit the job from employees quickly

High industry competirors

The smarter and more talented sale persons with regard to their interaction to clients The more customers will tell about their need and they are willing to your orgainzation to buy the services or products from yours (5) High competitors are conerned in managers’ lines because of clients The consumers or customers who have the priorty rights to choose the best services or products but the reasonable price is attractted to them The relationship between prices and markets has evaluated through market makers have a sury through markets and prices They expected profit maximizing tending to supply and demand chain and get feedback their competitors’ same way of supply-demand one as well (6) The translating industry was a special field that liked with government department such as Nortary Public, Committee People Department or Justice Department of Ho Chi Minh City,

to be a coollaborators who can have a legal character to sign the legal valued translated documents, however, the integrated economy with transmistion of circulars from Minister

of Justice from 2013, to encourage for small and midium enterprises to start-up business, translating industry to become the attracted fields for young and dynamic people who would like to do busiess with it, and it gradually become competed severly amongs companies togethers and appearing the low service prices to draw the customers

Unattractive salary

The employees are not recognized for their dedication or accomplishments that are considered only criticized for their shortcomings, they do not feel valued and work in the mood of fear of making a mistake A company should encourage the creativity through the fair reward and constructive judgment or recognition for creative, dedication in their work (7) The topic of salary and benefit issues has always argued in almost companies There exits the comprising paying among employees when they often get the salary and benefits to compare with other companies paying

It is defined that many different of factors that can impact to an individual

employee’s level of satisfaction with his/ her job These factors come from the level of paying and benefits (8) The writer can discuss that salary is still an important factor throughout the life of an employee’s career, but it is not the sole motivator to attract and keep the employees More and more people are considering companies that offer

incredible benefits, aside from salary If the employers do not know how invest in their employees, it is surely their top performers will go out of the door Based on the

interviews to find the causes related to high turnover rate of leavers from unattractive salary policy in Van Hung Xuan company

The update cause and effects map is presented as folows:

Figure 3 Updated Cause – Effect Map

Poor attractive new customers Poor customers

Weak customers’ relation

High turnover rate

of employees

Stressful workload Assigned

multitasks

Job dissatisfaction

Lack of human resource team

Unstable workload Reduce work

quality

Poor management capability