NATIONAL ECONOMICS UNIVESITY PAGE I Dao Thuy Linh – CQ493858 – Business English 49A NATIONAL ECONOMICS UNIVESITY ENGLISH FOR BUSINESS DEPARTMENT FACULTY OF FOREIGN LANGUAGES ((( ¬ DAO THUY LINH RECOMM[.]
INRODUCTION OF LEASING BUSINESS OF INTRACOM .3 1.1 Introduction of Intracom
History of establishment and outstanding achievements
Precursor of Intracom is a State-owned Company and it was transferred into Joint Stock Company model in 2006 That milestone marked the expanding of Intracom from a single business into a multiple business In other word, Intracom has diversified its business activity
Intracom with 300 employees include engineers, experts, workers, etc They work and build a plenty of projects of offices, apartments, social houses and new urban zones The chef filed of Intracom business is building containing hydro powers, high-rise and low-rise buildings etc However, the company is spreading its business into leasing, financial investment, building materials, etc
Intracom created and built its brand as a leading builder in construction with identical logo and slogan of “shining with country” and “integration for two-side development” It promises to bring winning and profit to its partners
Intracom has been awarded a number of achievements and merits Some are merit by building ministry, gold cup for successful integration 2000.
Business activities
Intracom is building company widening its activities to other fields of investment, leasing and material production Nevertheless, its main power is in building and sub-fields are investment, leasing and material production
The main strength of Intracom is building and construction, which makes it.Intracom values this as a start point and long development schedule Currently,Intracom is building 8 major projects: Intracom 1 Intracom 2, Intracom 3, Intracom
8, 2 hydro power projects, Oriental medical project, Ta Loi 3, Ta loi 5 and other small ones
Investment can be understood as spending spare money, labor, capitals, etc on the any field to make and create more money and benefits in the future Intracom currently is investing in finance, construction and hydro power In these, Intracom can contribute its capitals and other powers to the projects, following the principles of integration and sharing Beyond basic investments, Intracom stands on its incredibility to build up the close relationship with banks such as Agribank, Techcombank, Viettinbank and VRBank, etc
Intracom depends on building to improve leasing activity In other word, a number of finished and planned projects and buildings will become the foundation and sources to develop leasing activities Leasing is a kind of new filed in Vietnam theoretically, but in practice, it can be seen as traditional one Because many enterprises are powerful in building, which makes potentiality to enhance leasing based on the spare rooms in their buildings Also, leasing keeps many advantages to develop in a transitional economy in Vietnam Leasing not only solve the problems of offices in hot-time of estate but also helps company, especially medium companies saves money of wasting on building one of their own Seeing that need,Intracom determines to keep up with the modern trend, focuses on growing leasing business.
Leasing activity in Intracom: Role and Difficulties
It is hard to trace back the origin of leasing business No clear evidence of leasing is found However, leasing business has a quite simple development like a natural improvement For the beginning, it started from the using up of available rooms and spaces of buildings where its owner couldn’t spend all The owner would like to exploit the available resources which can bring them more money than leave them empty For developed countries like America, Japan, etc, leasing is concerned both as practical business and development of a new management For developing nations as Vietnam, leasing is a practical business which has been running for a long time but there is no theoretical term is developed So is truth for Intracom’s case In Intracom, leasing is an old business as construction Two activities are stuck closely together More and more developed construction is, more and more potential of development leasing is Nevertheless, the long time of history doesn’t go with scientific notion What is leasing? For them, leasing can be inclined generally The truth of few people in Intracom can have enough knowledge of leasing management which is a requirement to ensure the survival of a particular enterprise in leasing market Thus, It is not rumor to say that for the case of Intracom, leasing is a familiar business but still a new concept
Leasing is keeping more significant role in the improvement of Intracom In 3 fields of business, leasing is the second most profitable after construction In 2010, leasing activity brought Intrcom 5 billion VND, about 28% of its net profit while the benefit which was brought by financial investment was just about 12,7% despite its huge investment It is collected that Intracom has 4,8 billion VND on annual average. The estimation is predicted to increase gradually
Being invested heavily year after year
To recognize that reality, management board of Intracom has invested increasingly.The past years saw Intracom’s poor investment in leasing field because it heavily focused on construction and is attracted by new potential incomes from financial investment The ignored field of leasing now has its suitable funding The management is now caring for many issues involved The building’s design concerned as the job of architecture now is cared by whole board and advised from building experts who will tell Intracom the fashionable design and safety standards.Besides, they have to ensure to get beautiful and commercial surroundings and locations Intracom funds for leasing office problems involved have been raised 3 times in comparison to the past The management board accepts to pay more for higher bill of leasing based on the confirmation of solid growth of this field
As Philip Kotler says the difficulties of a business contain external and internal burdens The followings are external difficulties which come from the outside environment Intracom has face to 3 biggest challenges:
The first is from crowded market, harsh rivals Vietnam leasing office market now is assessed by global well-known real estate providers such as Savills and CBRS Vietnam as “exceed for the demand of companies and businesses” They say that spare offices in big cities as Hanoi and Ho Chi Minh City currently are 60% empty.
It is the situation of VN estate and leasing office field Leased offices can be divided into 3 categories of A, B, C classes A class covers luxury offices having average area of 5,000 Square meters, foreign management, high quality, modern design, computerized control, and good view while B and C offices are requested with less than 5,000 square meters, Vietnamese management, even technological standards cannot be high as the A class, however, they have to meet requirements of modern offices like containing separate escalator system, auto ventilation and lightning, etc The classification is depended on the location, average area, equipment and services Nevertheless, Vietnam lease market is developing, then criteria are not be agreed, classification is not actually accuracy Even the agreement has reached; some A-class offices cannot meet all the requirements In Vietnam, multinational tend to establish and build up their own offices and big group too, which makes the A class is more gloomy, less active than the market of
B and C Small and medium businesses favor leasing suitable offices because these offices is suitable for their business scope and ensure saving capital Even though C offices market is hotter than A and B markets, the competition in this segment is tough for all players If they do not want to be pulled out or sided out, they accept to fight hard There are some predators for class C offices like Intracom develop in the transitional economy in Vietnam First is the emergence of mass of small and medium businesses who cannot afford to build or buy an office for themselves The second is leasing office keep potential benefit which helps them to save capitals. The third is leasing an office is easier for them to change their location if the business environment changes or even they can find a new place for working if they do not satisfy with the services and profits in current leased office For all the benefits and advantages a leased office brings to leaser, the landlord like Intracom has to deal with the threats of losing customers and high level of empty offices which can waste money without any income
The second is from characteristics of “product” (office) Office is a kind of special product with shape and functions will be affected badly by time After 5 to 10 years of using, a building starts downgrading and falling behind the design of modern architecture That determinant makes customers find some new place which can meet their expectations of office and building design and beautifies their image in partners and rivals’ eyes So, theoretically, a building can survive for decades but can stand in leasing office field in more than 20 to 30 years It is said that building and construction is one of the most active and changing businesses in an economy.
To have great and competitive product/offices, investors and constructors have to maintain and redesign their products regularly which pull along amount of massive sum
The third is from higher and higher requirements of renters Leasers want to hire a comfortable office, a suitable one for their business They need to be decorated in professional style and they need satisfying services with clean offices and toilets. They need more free stuffs, more free parking lots attached They never want to stop desiring and needing form a product When they are satisfied with all above requirements, they keep desiring a reduced cost and delayed payment All things defined here are not a kind of complains from renters, nevertheless, company/landlord like Intracom has to find how-to meet customers’ expectations. However, before meeting customers’ expectations, companies see them as challenges How they can increase quality of offices and services with lower price while cost and inflation do not have tendency to stop
There may be many reasons for Lease Division situation, one of those is inefficient management, which will be analyzed as the focus of this report The following chapters of my report aimed at finding the answers to some questions:
However, it has to be accepted that the external challenges of Intracom are the common challenges for all firms running their business in leasing business In the study, what being focused is not the external challenges coming from the business environment but the internal challenges of Intracom They are management of employees’ performance and the customer relationship
- What are issues of employees’ performance management in Intracom?
- What are failures of Intracom in management of customer relationship?
- How can Intracom Lease Division improve its employees’ performance and customer relationship management?
Research methodology and methods of data collection
This report used observational method to observe and record how management tasks are performed by Lease Department in order to point out some drawbacks emerging in the middle of its operation process Basing on quantitative method, it analyzed numerical statistics from the company’s performance reports and minutes of internal meetings such as its revenue, rates of revenue to draw a clear picture of Lease Department’s situation concerning its growth, position and competitive strength among other departments Moreover, carried out as a descriptive research, this report aims at identifying the underlying causes leading to Lease Department weaknesses from which proper recommendations can be given out.
This report analyzes failure of Lease Department – Intracom in employees’ performance and customer relationship management,
In the close-up of the performance of Lease Department, some problems in leasing mangement management have arisen In the latter part of my report, I will introduce the theoretical framework for leasing management on which I can draw a clear picture for the department situation, especially its failures in applying management principles which result in its current weaknesses.
Framework
As far as I concerned whatever problem in my writing, the most general and rooting source I should mention is management A according to the long history of management theory development and the deep research of pundits, numerous definitions have come to the life, here some well-known quotes:
“Management” (from Old French ménagement “the art of conducting, directing”, from Latin manu agere “to lead by the hand”) characterizes the process of leading and directing all or part of an organization, often a business, through the deployment and manipulation of resources (human, financial, material, intellectual or intangible)
(http://www.expertwitness.com/srch/human/resource/management/in/relation/to/ care/needs/assessment/and/reveiw.htm)
The definition is traced back to the root meaning of Latin phrase “to lead by the hand” It suggests the management should be giving direction rather than passing suggestion but still in gentle approach
The other interpretation of this term is “ Management is the process of achieving the objectives of the business organization by bringing together human, physical, and financial resources in an optimum combination and making the best decision for the organization while taking into consideration its operating environment.”
(http://www.managementheaven.com/established-definitions- management/)
The definition stresses the components of resources to achieve a planned objectives, however, its differentiator is concerning operating environment as one of must- know to managers
From two above definitions “Management” can be understood as a process of achieving an objective by utilizing tangible and intangible resources of materials, finance and human, etc
A lease is a contractual agreement between the renter (owner) and the lessee (second party) for a specified asset, which can be property, a house or apartment, business or office equipment, an automobile or even a horse The lessee receives the right to total ownership for a spelled out period of time and conditions in return for payments Do not confuse a lease with a rental, although these words are often interchanged A rental is for a short period of time, such as a month, where, in this case, the agreement is renewed or the terms are changed monthly
( www.ehow.com/ab out _4811014_definition-of-leasing.html )
Lease is defined as a written agreement under which a property owner allows a tenant to use the property for a specified period of time and rent.
Lease management is a complex process with distinct phases that if not managed correctly can cost a real estate company significant revenue losses, court costs, or lost tenants A typical deal involves multiple departments, each working on their portion of the lease Often, outside or third-party collaboration is also used Leasing agents, legal counsel, outside consultants, property managers, and corporate executives all need an effective way to communicate with each other in order to effectively complete their piece of the overall transaction–all while creating appropriate records and audit trail
(http://www.opentext.com/2/global/sol-industry/sol-ind-realestate/sol-ind-realestate-leasemgmt.htm )
Leasing is a business with special “product” which will not be change the ownership after leasing The product, here, is offices still under the ownership of leaser but its utility currently under the renters’ right Because of those characteristics, leasing office has involvement to many things, accordingly, based on the criteria of division, some problems can be named, and however, four main concerns are named including: Office, service, employees’ performance and customer relationship managements
Office management is an organizational lifecycle function within a company dealing with the planning or forecasting or marketing of building and offices at all stages of their longevity and preference The preference is mentioned here because in leasing offices, a renter leases an office being affected not only by factors of price, location and surrounding but by the design and the architecture These show them indirectly and build up first impression of their partners and customers
Service management in leasing office introduces monitoring and optimizing a service or sub-services of leasing to ensure that they meet the critical outcomes the customer values Plus, these services such as cleaning, reception and security, free parking will contribute to persuade customers’ favourite to a given leaser.
Two following concerns are the most recognized issues in leasing management In which, firms try to improve to compete and debate their rivals In the future, experts say that these will be the most decisive, innovative and changeable factors determining the survival of leasing firms
Employee performance management is a process that companies use to ensure their employees are contributing to producing a high quality product or service Employee performance management encourages the employee to get involved in the planning for the company, and therefore anticipates by having a role in the process the employee will be motivated to perform at a high level
(http://www.ehow.com/about_5044541_definition-employee-performance- management.html)
Employee performance management is briefly defined as a process companies use to ensure their employees are contributing to producing a high quality product or service Employee performance management encourages the employee to get involved in the planning for the company, and therefore anticipates by having a role in the process the employee will be motivated to perform at a high level Managers,
IT staff, blue workers, receptionists, etc, all are counted on personnel of a leasing business How good the management of these people will determine the success of a company in field Actually, this is seen and assessed as one of the most vital factors to company’s future and operation The recent studies disclosed the fact of proficiency under the effects of employees’ performance The proficiency increases depending on the positive attitude and the skilful level of labours while this data tends to decrease due to the negative feeling and untrained level of employees
Customer Relationship Management (CRM) is an information industry term for methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized and efficient manner In many cases, an enterprise builds a database about its customers This database describes relationships in sufficient detail so that management, salespeople, and customer service reps can access information; match customer needs with product plans and offerings; remind customers of service requirements; know what other products a customer had purchased; etc
(www.mariosalexandrou.com/ / crm asp )
CRM is a widely-implemented strategy for managing a company’s interactions with customers, clients and sales prospects It involves using technology to organize, automate, and synchronize business processes principally sales activities, but also those for marketing, customer service, and technical support The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service Customer relationship management describes a company-wide business strategy including customer-interface departments as well as other departments In leasing business, what especially mentioned is the maintenance or remaining customers because the leasing contact usually lasts around 10 years or over, in that longevity of time, a leaser can cut involved costs of finding new customers and advertising They can cut and save capitals at the same time That is a smart approach
Important role of employee and customer relationship managements in
managements in leasing field a Decisive factors to improve competitiveness of company
Competitiveness of a unit in business environment sees employee performance as determinant In manufacturing field, employees are labour making goods, their skills will determine the product quality A skilled labour is able to create well processed product, on the contrary, unskilled labour cannot, in some case, they may make unacceptable errors In services, the performance of employees is even more serious issues Because the consequence of their wrongness cannot be shown instantly, the repeated wrongness or errors will devastate images and business of company For example, receptionists should be polite and welcome; she/he has to bring the feeling of eagerness and profession at the first glance for visitor If she can bring customers the good impression, she accidently or purposely becomes a barrier on the way customers come to company, they are affected by the poor impression thus they hesitate to partner with company In other aspect, what benefits a company can bring to its employees are competitive involvement in business The competitiveness is in labour market Attraction to good labour mainly decided by well-being a company can provide is decisive actors to its flowing stream of talents who will make the last decisions of business fate Companies, currently, are in fierce round to get the championship of who is the most attractive? And who is the best? They run a race of giving the most sky-level wage, of most desirable working environment or most numerous promotions, etc the proves tells the truth of recognition of businesses about the importance of motivation to labours are popular.Whole world of business sees motivation as a considerable problem which needs investing properly
If management of employee performance is an internal factor, management of customer relationship is external How can a company keep contact with its customers in the effective way in the most saving way? Finding customers in Red Ocean is difficult, but keeping them to remain their business transaction to us even more challenging Red-ocean is water area where full of “sharks”, strong suppliers or producers, where every little cake category is fought over It seems to be the place natural selection works, the weak will be killed and the strongest left dominating marketplace Firms playing in that ground find “making good relationship” with customer as the secret weapon for their survival It is not strange customers but close and familiar ones How to change them into repeated and gold customers require a plenty of trying and endeavour It is about providing good products/services, keeping contact frequently, understands future consumption desires, being a head of trend, and so many involvements which have to be seen in a specific business case The significance of keeping relationship is more and more recognized because the advantages First and foremost, making good relationship with customers is the best way to PR one product or service, the familiar customer can introduce their choice of a brand name to his acquaintance or friends, relatives, etc according to economic researchers, and this is the best advertising resort The second, if customer relation is remained for a long time, utility of product or services become a “habit” or even becomes a part of “tradition” That point is ideal for all businesses The case of Coca-Cola is typical for that theory Since the day of foundation, coca-cola has come in mind and stack step by step to their memory; it has become a part of American culture, which is the strongest point of Coca-Cola to beat its rivals in the new century Pepsi, its harsh competitor ever, has overcome Coca-Cola taste and marketing approach, however, Pepsi could defeat Coca-cola to be the haunted image in their mind That is why Pepsi always on the second place. The third advantage is about cost saving, how much money a company has to withdraw to persuade and attract a new customer and do not know they will come back or not, for certain? That’s risk investment, if cost is over the income, they will lose How could they remain their survival? It is hard to come to the accuracy number, however, it is estimated to bring up an industry of marketing From some of advantages named companies look CRM as a field need heavy investment.
Actually, successful companies are companies can give the appropriate attitude and funds to CRM b Innovative factors in leasing business
Innovation is most repeated term in modern business In the field of computer production, it is said that for each new version appears in the market, the other version which is faster and more innovative is designed Innovation becomes problem of “to be or not to be” It is true not only for the most active field like computer manufacturing but also the services like leasing Innovation in leasing is about concerning architecture, location, facilities, finding and keeping customer methods, serving style, level training employees Here, architecture and location, facilities are issues cannot be shifted after building process It can be complicated and over-costly to start reconsidering those problems after completion Then, finding and keeping customers/renters as called CRM and serving style might be more feasible Serving style will be changed depending on the skills and how motivated employees are? Truly, they should be seen in problems of “employee management”.
In recent years, firms show their great creativeness in managing to keep in touch with customers and to motivate and to train staff Many computer-based programs of managing customer have been born to restore customer data and connection. Programs such as Prophet, Maximizer, Commence are used increasingly by leasing companies They go on applying programs to keep their business activities smooth.
In future, the promising appearance of new programs are made, companies want to grow to get quick response to changes
Market and technology are changing quickly, which outdates knowledge taught in school, employees with that obsolete knowledge are forced to face with the challenges of modern and complex technology, they have to be retrained to grasp new knowledge In other word, more and more changing technology has been, more and more innovative training has to be The question is why training needs to be innovative First of all, training needs to be innovative to bring the most effective result to trainees, which will influence directly on proficiency Then, the knowledge taught must be applied in the reality instantly Because the fast trend of technology means one technology is soon out of date If that knowledge cannot be transferred quickly, it will become ineffective Staff cannot keep up with technology, which decreases proficiency and waste fund and time of training Secondly, innovation in training reflects modern management of a company That management method requests employees learn continuously, in training process who can follow and prove themselves will be the survival, on the contrary who cannot give enough trying and follow will be left So that, creating training innovative and effective is not a puzzle for manager but also the problem of trainees They have to get for themselves the best measure of learning Then, training now is not one-way direction but multi-way direction, a trainee can learn from trainer and other better trainees and learning by doing, etc for how many ways a trainee is taught and how creative he/she is in learning process, the final goal is grasping the new technology and method as quickly as possible c Changeable factor in leasing office business
After a building is done, it comes to leasing market and launched for rent At that time, changes in architecture and construction are hard to be made because it wastes up so much financial capitals and time, even it can make a building come to be broken away That special and separate character of leasing industry forces managers to consider carefully before starting construction of a building, they have to reach an agreement on architecture all Then to face with tough competitiveness in market, management sees services and customer relationship management as effective weapons Services must ensure quality and hospitableness These requirements for deeper will be determined by employees Therefore, to reach the competitive advantage in giving service, the managers need care two questions of management of employees and customer relationship.
Improving customer and employee relationship managements
To enhance performance of employees, a manager has to realize where the employee’s ability is, their ability now is on which step of evaluation ladder?Therefore, it is necessary to give an exact evaluation to employee’s performance.
Making an appraisal list is important and one of the initiative things should be done immediately
There are many reasons why you may decide that an appraisal is appropriate and the following is a common list for using one: to identify any training that may be needed, to make personal/business objectives clear, to identify employees that are potential for promotion, to review salaries or payment methods Management board is encouraged to implement appraisal because of identifying individual strengths of employees, increasing motivation in the workplace, updating job descriptions
Using an appraisal system brings plenty of benefits For instance, it gives an idea of what you should expect from your employees For employees are given feed-back, it helps them increase productivity and ability by eliminating weakness and identifying strength Manager and superior will develop a better relationship with employees by getting to know them better and what their job consists of more precisely
Appraisals have no set structure when time is involved and are usually done when the business believes it is necessary Ideally, appraisal should be something that goes on all year but there are only times when you can formally evaluate your employees Although different people will have different opinions on when an appraisal evaluation should be issued, the first is suggested after six months of the initial employment of the employee After this, the next appraisal is suggested six months later and then extended to following yearly periods It is therefore saying that all employees will have different times for appraisal evaluations but a specific time of the year where evaluation of all employees at the same time being done should be indicated.
2.3.1.2 Motivating employees via understanding and meeting their needs a Traditional theory “X”
The theory by Sigmund Freud who was no lover of people, and was far from being optimistic Theory assumes that people are lazy, they hate work to the extent that they avoid it; they have no ambition, take no initiative and avoid taking any responsibility, all they want is security and to get them to do any work, they must be rewarded, coerced, intimidated and punished This is so-called “stick and carrot” philosophy of management If this theory were valid, managers will have to constantly police their staff, whom they cannot trust and who will refuse to cooperate In such an oppressive and frustrating atmosphere, both for the manager and the managed, there is no possibility of any achievement or any creative work But fortunately, as we know, this is not the case
(http://www.accel-team.com/motivation/theory_01.html )
Freud’s theory especially is unsuitable for employee management The theory just sees on the pessimistic side of a labour and doesn’t encourage employees to contribute to the work and the general objective of the company b Theory “Y” by Douglas McGregor
This is in sharp contrast to theory “X” McGreygor believed that people want to learn and that work is natural activity to the extent that they develop self-discipline and self-development They see their reward not so much in cash payments as in the freedom to do difficult and challenging work themselves The managers’ job is to
“dovetail” the human wish for self-development into the organizations need for maximum productive efficiency The basic objectives of both are therefore met and with imagination and sincerity, the enormous potential can be tapped
This theory can be construed by some, that theory “Y” management is soft and slack This is not true and the profit in the “pudding”, for it has already proved its worth in the USA and elsewhere For best results, the persons must be carefully selected to form a homogeneous group A good leader of such a group may conveniently “absent” from group meetings so they can discuss the matters freely and help select and “groom” a new leader The leader does no longer hanker after power, lets people develop freely, and may even (it is hoped) enjoy watching the development and actualization, gains as a result c Theory “Z”
Abraham Maslow (1908-1970) is considered as the pioneer in humanistic psychology, as seen as the Third Force) when the globe just knew 2 main psychologies: Psychoanalysis and Behaviourism.
In 1943, he created and developed a theory which would be recognized widely and applied in different aspects including education and training, the theory of
Hierarchy of Needs In his theory, needs of human are set up in the ladder system, which ensures that the higher step can be achieved only when the lower is satisfied.
The hierarchic theory is often represented as a pyramid, with the larger, lower levels representing the lower needs, and the upper point representing the need for self- actualization Maslow believes that the only reason that people would not move well in direction of self-actualization is because of hindrances placed in their way by society He states that education is one of these hindrances He recommends ways education can switch from its usual person-stunting tactics to person-growing approaches Maslow states that educators should respond to the potential an individual has for growing into a self-actualizing person of his/her own kind
According to the modern psychology, Maslow theory still keeps some disadvantages as followings In reality, people don’t work necessarily one by one through these levels, they are much less structured in the way they satisfy their needs Besides, different people with different cultural backgrounds and in different situations may have different hierarchies of need Even some researchers claim that other needs are also significant or even more significant, for example, the needs of achievement, affiliation and power
Grasping and anticipating customers’ needs
First, customers are not created equal They come and buy from you for different reasons based on different motivations Some buy because they find your price to be the lowest, some because they find your services to be outstanding, while some purchase from you because of your reputation in the industry.
Second, by knowing and understanding customers, a company will be able to better leverage its time, energy and resources to pursuing the right customers It can adapt its selling strategies to each type of customer: shorter and quicker selling strategies to price-conscious customers, while dedicating more time and resources to its most important and high-potential customers Especially manager of a company needs to re-evaluate his/her customer relationships and make choices about how to maximize and effectively use limited time and resources.
Below is a list of questions that can help managers look at their customer's motivations and in the process they can learn new insights about their customers, their needs and threats and opportunities that exist These five questions will help manager to get a snapshot of their business where their healthy relationships exist, where there are opportunities, and where there are potential problems.
These are 5 questions a company should concern to keep their relationship with customers:
Question1: Why does a customer buy?
Employee performance management
3.1.1 Employee performance a Features of Intracom employees
Intracom has total 302 persons in working including 1 general manager, 7 directors and others including engineers, white-collar and blue-collar staff However, the amount of staff handle leasing business of company under 20 persons consisting of director, assistance of director, hygiene staff, receptionists and security staff
56% of Intracom employees are young, under 40 years old, almost work as white- collar, they prepare for paper work while 20% employee are over 40 years old. Annually, Intracom has its own recruitment day when plenty of newcomers are welcomed into Intracom In the leasing division, the manager is 28 years old, her assistance is 25 years old, the hygiene staff all are over 40 years old, the electricity staff including 2 persons over 30 years old, and security staff all are under 25 years old, the only one receptionist is 24 years old
All of the white-collar workers in Intracom graduated colleges and universities while 20% achieved high-school education and under However, some cases of workers (about 10 persons) just received the primary education, they works as hygiene staff, taking care of cleaning offices In the leasing department, the director and her assistance graduated from college of national economics with the major of economic investment Others are educated in vocational schools and secondary schools, a number of employees never received secondary education are 7 persons, all of them work as hygiene staff Electricity fixing staff includes 2 persons and graduated from vocational schools b Job descriptions
As mentioned before, Intracom runs business in many fields including leasing office In the extent of my study, I just want to concentrate to leasing business. Leasing department of Intracom has task of filling the empty offices in its buildings and operating activities involved in the buildings People in the department have worked together to provide good services of leasing
The manager has to take care of all leasing works from finding customers and dealing with customers’ complaints She is taking charge of marketing, preparing legal issues and signing contacts, purchasing devices serving activities in building etc her working time is from 8 am to 5:30 pm.
For security staff, they are handed to ensure security in the buildings, saving vehicles of customers and people working in buildings, dealing with public confusion involving to Intracom They work 24/24 divided into 3 shifts
For hygiene staff, they have to ensure all rooms in buildings are clean all the time. They work from 5am to 4pm.
3.1.2 Employee satisfactions a Results from interviewing present employees
When being asked “are you satisfied with your present job?”, all of the employees in the leasing department said “ No” Some reasons make them feel unsatisfied with present work First of all is due to the payment They say it is too low in comparison to the average wage in Hanoi and other companies in the same industry The second reason is because of the job-self, the director of leasing department feels unpleasant for herself because on the contrary with her friends in colleges, her job now has the lower reputation, which makes her not want to feel proud She keeps feeling that she is in wrong place and she can be promoted more in more prideful job such as a bank worker The third reason is put on the future improvement of work in the company, many people cannot their far-future in this company because they keep the same position through many years of working Even the promotion is not only the problem of the management board in assessing human resource but the work of each employee, who has to prove to be the potential success and to be the leader in future But seeing from the side of the management board, they give employees fewer opportunities to be trained and to be challenged which will encourage them to develop themselves In many years, people working in company rarely have eyed the training courses being taken truly If some courses have ever organized, employees just saw them as thing called “wasting time” and “no effect” or “without influence”, etc because of that fact, employees working Intracom see themselves losing their competitive advantage in labour market, they assume that a long time working for Intracom blunts their ability and burn their enthusiasm For employees, especially young employees, Intracom is just a pause-point where they can stop in a moment of their life and waiting for something more challenging, more active and more promising b Conclusions after surveying employee turnover
In 3 working years, Intracom has complemented recruitment in 9 times with large scale from significant positions of managers and directors to manual positions. Many reasons of recruitment more employees can be exposed, such as spreading business activity, lack of professionals, etc However, the main reason of Intracom case is employee turnover, the number and frequency of employees in and out Intracom are large Normally, young employees came into Intracom but they stay here for 6 months, sometimes 2 months, then they leave for better jobs Their in and out definitely is not their personal problems, actually, it is the headache cause of Intracom It wastes the company’s fund for each time of recruitment and training; it wastes capitals for running recruitment programs and for paper work The cost annually takes a category of 2% income The biggest category of leaving employees is the young who have left their university Even though they are talent and creative which will be the gold factors for the development of a company in fierce competitive market Intracom can keep them means it cannot maintain its competitiveness in market, then sooner or later it will be knocked down by stronger ones with educated and active employees The loyal employees to Intracom are mainly manual workers who don’t have many options of jobs, they are middle age with a family and don’t dare to challenge themselves, they are who need “safety” or
“security” than other else They are afraid of losing their current jobs, and then they stay and live on Intracom Let’s imagine Intracom machine with outnumber of “old devices” It should be asked that could Intracom maintain its survival with obsolete engines like that? As an old motorbike runs in wasting oil slowly, Intracom will find itself out of the playground.
Customer relationship management
3.2.1 Intracom’s knowledge about its customers
Based on the theory in chapter 2 about relationship with customer 5 main questions involving in Intracom leasing activity should be mentioned.
Number renters ‘name Price (USD/m2) Area of office ( m2)
15 International devices and services JSC
Currently, Intracom’s customers include foreign and domestic companies They have the common feature of small scale, even its office is representative office. International organization lease office for contact address only Other Vietnamese companies are media companies or small-scale firms who demand small or middle rooms and good impression and beautiful design
Based on above information and collected one from my study, we can step by step answer following questions and assess the understanding of Intracom leasing department of its customers
Question 1: Why do customers choose Intracom building?
Intracom is building office classed in C type because the main customers of this office kind are small and medium firms which lack of capitals They are new and young, then for them, leasing office is the best option to save their capitals For these firms, leasing office is also suitable for their business situation if they want to change office Such customers need their office clean, beautiful, professional which will impress their partners and customers at first sight Because of that demand, the leasers as Intracom must stress on the design and services It should get beautiful and creative outlay and design, these renters should care sub-services providing to their customers, make sure that their offices always clean and fresh
Intracom building is a 9-storey building with each storey is estimated about 600 square meters large enough for offices of 3 small-scale companies It is located atPham Hung Street next to My Dinh bus station, near main roads, which makes good conditions for transportation and trading The surrounding includes high-rise buildings for lease and big banks and companies such as Tien Phong Bank, IJC Company, Audi showroom, etc which put Intracom at the centre post and attract plenty of leasers
These conditions promote Intracom as an outstanding in leasing offices, however, the disadvantage side or the weakness of Intracom is marketing It can market its identification and recognition in the customers’ view, the amount of people know about the brand of Intracom is small
People may know well about buildings such as Vincom, BIDV but a few do know Intracom Obviously, these buildings and Intracom are not in the same share of market, Intracom is C-class building while they are buildings in A and B classes It has to be admitted that big buildings will get more fund and capitals for marketing and ads; they can appear on big presses and newspapers like Vietnamnews, Ecomics Times, etc Nevertheless, with less cash, C-buildings as Intracom will take its way to market and ads In the forest of marketing ways, it even can exploit the advantage of Internet and its own customers, their customers will be the main marketers if Intracom can persuade them by its offices and perfect services
Question 2: How much of the customer's total business does Intracom have compared with its competitors?
In Hanoi location now, there are around 260 C-class buildings as the estimation by Savills, a leading real estate services provider The predication of A and B classes are cooling while C market becomes hotter Intracom has competed to other 259 buildings to attract customers Although the manager of Intracom sees the fact of hard rivalry but they do not know the exact index calculating or counting how strong their competitors are It is hard to complement a study involved because it wastes a lot of money and time It is still necessary to make a brief survey to find out the fact of competition
Since the first day of working, Intracom hasn’t taken any surveys to understand the environment market Understanding of Intracom about its competitors is fade and lack of proofs, which is the reflection of unprofessional working style
Questions 3: How does Intracom’s customer see it?
Intracom truly sees its customers as its partners who will cooperate with it and both come to success The guideline of Intracom is “cooperation for bilateral development” Even that is the guideline of Intracom for running business, it is still necessary to ask questions to probe their customers, to understand them carefully and more precisely Some things and hidden things will not be known without asking or surveying The one who knows how to exploit and to understand their customers will be the winner in the fast changing market Therefore, Intracom should be closer to its customers via numerous means from interviewing to making survey, from simple issue to complex one.
Question 4: How difficult is for the customer to shift to Intracom’s competitor?
For crowded leasing market of Hanoi, it is not hard or difficult for a customer changing from one renter to another if that leaser cannot satisfy their requirements and wishes According to Savills and Knighfrank, the main reasons persuade and keep customers loyal to a company are service quality and relationship of that company with customer Better and better its service and relationship with customers are, more and more difficulties their rivals are to get its customers
Intracom needs to self asset its quality of services and relationship with customers.
Is it good? Is it the best they can get and try, are its competitors’ services better? Is there something they can improve in relation with customers? If Intracom can find the right answers for these questions, and keep considering about its weakness, finding way to improve, it can make sure about its business
Question 5: What does the customer expect after signing leasing contract with Intracom?
Leasing is kind of special business, a particular service, in which renters need to meet expectations of customers all the time It is not a kind of selling something then the firm can let it out of mind For sale business, after sale service is one of the important parts to keep customers loyal to them and change them to be the gold customers So is it true for leasing business The task in this business even more difficult because customers are in use the firm’s business, they can quit the contact immediately if they don’t satisfy with service provides even they have to compromise the contact The harder part even come later, when the brand and reputation is influenced badly because impression and comment of one customer becomes spreading and lure others’ view.
For leasing business, after a customer comes to sign up a contract, they will demand their offices always clean and receptionists and securities must be polite and have good manner of communication, they also desire more parking place and promotions and more privilege because they are gold customers.
Intracom needs care about its services lots, which will be determined mainly by employees and balancing between its profit and customers’ benefit, brainstorming which way is best for both sides That is a headache math for business persons
Intracom has equipped the buildings with plenty of devices which can be divided into two groups:
Public devices: lights, shoe cleaner, automatic door, electrical loudspeaker, time speaker, ventalization system, lobby camera.
Office devices: lights, air-conditioning.
Electrical and technological devices are set up time to run in administrative time but public lights are turned on at 5pm and 6pm to 6am of the next day. However, computerized devices are seen as shortage and communication- supported devices haven’t equipped yet Especially, camera system has not been exploited in its usual capacity.
Intracom should consider using camera system at maximum volume and equip computerized devices, office management software to make its business more professional
After analyzing the situations of Intracom, there are two biggest problems The first thing involving in employee management, Intracom’s employee management is assessed of classifications and special treatment among employees, which can identify and encourage excellent labor Moreover, the salary scheme of Intracom is not positive It means Intracom’s salary is not useful in keeping employees loyal,not only because the salary is quite low but also is the same for the best and the worst labor
The second problem of Intracom involves in customer relationship management It lacks of modern device supporting connection to customers and storage of customer information
After findings the problems of Intracom, some recommendations will be displayed in Chapter 4 These recommendations are mainly about employee management and customer relationship in leasing business.
Employee management suggestions
4.1.1 Improving employees’ performance through opening training courses, drawing up employees in rank and waging properly a Opening training course
Training courses keep important role in the development and improvement of a company in private and whole industry in general If employees cannot learn new knowledge and technology, they are left and failed by themselves Training courses keep one company’s technology updated and following modern technology
Intracom should open training courses regularly to hand over the technology and enhance profession to staff Training courses should include simple and complex contents That means not only engineers or architectures or directors need training but labor workers and manual labor need training as well.
“Trainer” needn’t to be a teacher or lecturer but can be a craft employee who can share their experience and knowledge Training courses should be organized gradually, intermix with working That measure ensures both working and training.
To improve efficiency of training courses, managers and directors should consider putting it in the employee assessment Employees show their trying and activeness in training should be highly valued b Drawing up employees
To motivate employees, keep them going on work, a hierarchy of work and responsibility should be set up Even for employees taking care of the same responsibility, some labels of title should be named to identify professional staff and inexperienced staff The way will be given a high opinion by professionals and be an encouragement to people at the lower positions, which will force them to try more c Facilitating modern devices to support employees’ work
Nowadays the professional of an employee will depend partially on their ability to operate facilities and modern devices Obsolete devices cannot help bring high efficiency while modern devices can benefit both proficiency and energy saving
To improve employees’ performance, Intracom should equip and install office management programs which will help leasing staff keep track of the current state of building, for example, using state, fire protection, air-conditioning systems, etc. The labor workers should be trained to use computers because area of building will be computerized in management, if they cannot know how computers work and what they are telling, computers are running in shortage of capacity
4.1.2 Improving employee satisfaction level a Adjusting salary to match the market price
One of the main reasons of employees leaving Intracom frequently is payment or salary 80% employees are not satisfied with their payment; they feel it is too low in comparison to their work Even salary Intracom pays to its employees is not lower than the average salary in the labor market The faulty of the salary system is
“property”, employees need feeling of special and different senses, which ensures their need of “self-esteem” Like it is mentioned before different title job for different people in the same job, it should have different payment for different title jobs That ensures the labor cost of Intracom is not much higher than the labor,which can save for company and get the efficiency of encouragement to employees.
If they want to get higher payment they should try more to be professional but not leaving to find another company b Giving other welfares
Besides salary, a lot of measures can show the efficiency of keeping customers and give them the feelings of satisfaction For example, commending excellent persons, giving worthy awards, providing unemployment insurance, etc for the young workers, giving chances to be “in” in the organizations, hand them opportunities to prove themselves and show their abilities to contribute into the success of the company.
Therefore, Intracom should concentrate more in psychological satisfaction which can cost low but bring high benefit Employees will feel “in” and satisfied themselves, which will keep them stay longer with company
In leasing offices industry, understanding customers is not less important than other industries; in fact, it seems to be even more serious Understanding customers will determine one firm’s business; it will come to an end or will flourish There are many measures for a firm to keep its relationship with customers via exploiting and understanding them Firms try their best to closely keep in touch with customers, fast respond to customers’ complains, moreover, they have to know how to balance between the benefits of company and customers because customers’ desires sometimes affect to profit or income of company
Running business each company has its own strategy but the most urgent recommendation involves customer survey, Intracom should implement a survey on its customers’ features and needs exactly to know scientifically and specifically but not predict without figures
Consequences of surveying without specific study can drive one business to its collapse
To develop communication channels and customer data storage
In the process of communicating, customers and renters may not understand together because of “noise” in the environment, quality of communication is harmed badly, which decreases ability of understanding customers of renters
To reduce “noise” in the environment, ensuring a calm environment is important, then setting up other channels of communication except telephoning, for example, emailing, using hand-set, face-to-face conversation, texting, etc There are numerous ways for Intracom to implement to improve its communication quality with customers
4.2.2 To facilitate customer data storage