COMPANY INTRODUCTION
Company overview
Imperial Tobacco, a subsidiary group of Imperial Brands, is among the largest corporations in the global tobacco industry The subsidiaries of Imperial Tobacco are involved in the manufacturing and trading of various tobacco products, including cigarettes, cigars, and accessories like papers and tubes.
Tobacco International Limited Company in United Kingdom has established its representative office in Ho Chi Minh city, Viet Nam since 1995 and the office is called Imperial Tobacco Vietnam
Representative Office (ITVN) ITVN’s scope of activities is a liaison office, conducting market surveys, identifying and accelerating the trade opportunities in Vietnam market on behalf of the
ITVN, based in the United Kingdom, is prohibited from engaging in direct profit-generating activities in Vietnam Instead, its role is to support the Head Office, Imperial Tobacco International Limited Company, in enhancing product sales within the Vietnamese market Consequently, ITVN is tasked with investing in strategies to increase the sales volume of the company's products in Vietnam, as higher sales directly contribute to greater profits for the Head Office.
The key product of ITVN is Bastos cigarettes, which are producing by local manufacturer under the licensing contract with Imperial Tobacco International Limited Company in United Kingdom
Bastos cigarettes have been a prominent player in the Vietnamese market for nearly 25 years, currently ranking among the top ten selling brands with a market share of approximately 5% as of 2018, according to AC Nielsen Positioned in the mainstream segment, Bastos offers packs of 20 cigarettes priced between 10,000 and 12,000 dong Its main competitors in this price range include Thang Long and Sai Gon cigarettes, both produced by the state-owned corporation Vinataba.
The operational framework of Imperial Tobacco in the Vietnamese market is illustrated in Figure 1.
Besides, Imperial Tobacco Vietnam Representative Office inherits six values from Imperial
Imperial Brands emphasizes core values such as ownership, engagement, and enjoyment, which are essential for enhancing employee competency, performance, motivation, and retention The company has established Leadership Expectations that empower both leaders and employees to drive performance, take accountability, build capabilities, lead by example, foster continuous improvement, and create effective teams.
Organizational structure
At the end of the year 2019, ITVN has 20 direct employees who are working in 6 departments in
ITVN, which are: Operation Support, Human Resource (HR& Admin), Finance, Marketing, Sales, and Business Intelligence Besides, ITVN also has 12 indirect employees working in Data Analysis
The Data Analysis Team at ITVN consists of indirect employees who report to the Business Intelligence Manager These employees have their labor contracts with Humidor Company, the labor supply agency of ITVN, and receive their salaries through ITVN via Humidor.
Imperial Tobacco International Limited Company in United Kingdom (Head Office)
Dong Nai Food Industrial Corporation (Manufacturer)
Supply materials based on licensing contract
Earnings profits on material supplied and Royalty fees on products sold
Distribution channel of Bastos products in Vietnam market
Investment to distribution channel to boost sales
Figure 1 ITVN Operation diagram tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
The recruitment process for the Data Analysis Team at ITVN is managed by the Human Resource Department, which oversees recruitment, training, performance appraisal, and salary payments for both direct and indirect employees However, there is a notable disparity in benefits between these two groups Direct employees, who have signed labor contracts with the Representative Office, enjoy additional perks such as annual performance bonuses and family healthcare insurance In contrast, indirect employees, contracted through a labor agency, do not receive these benefits Additionally, direct employees are considered official headcounts of ITVN.
Imperial Brands provides employee codes for logging into their intranet websites, granting access to various online resources The organizational structure of ITVN is illustrated in Figure 2 below.
(Source: ITVN Human Resource Department)
Since its establishment in 2015, the Data Analysis team has focused on gathering and analyzing market data related to the tobacco industry and ITVN's competitors in the Vietnamese market.
The Data Analysis team is responsible for inputting daily market data into the internal system, monitoring sell-in and sell-out volumes of Bastos cigarettes, and tracking inventory levels among distributors and wholesalers They generate and analyze reports on Bastos and its competitors, providing the Business Intelligence Manager with valuable insights into the Vietnamese tobacco industry, thereby enabling informed support for the Director.
Labor contract signed with ITVN
Labor contract signed with Agency
Data Analysis Team tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
7 decision making The Director is responsible for all operations and activities of ITVN, as well as provides strategies to the head quarter for future growth of ITVN
Before 2015, ITVN relied on purchasing market data from AC Nielsen, spending approximately 5 billion dongs annually to analyze the tobacco industry and its competitors in Vietnam In response to this costly approach, the Director of ITVN decided to establish a Data Analysis team in 2015.
The Data Analysis team at ITVN is responsible for collating and analyzing market data, with total employment costs amounting to approximately 2 billion dongs annually Additionally, the cost of collecting raw market data is around 1 billion dongs per year By maintaining the Data Analysis team, ITVN can save about 2 billion dongs each year while still producing comprehensive reports on the tobacco industry and its competitors in the Vietnamese market.
PROBLEM CONTEXT
Symptoms
Despite having a robust strategy for attracting, motivating, and retaining talent, Imperial Tobacco Vietnam (ITVN) has experienced a high voluntary turnover rate over the past two years, with a significant increase in 2019 This trend indicates underlying issues that require validation and analysis to identify the root causes It is essential to diagnose these problems and develop effective solutions and implementation plans to enhance the company's situation.
Based on the data collected from Human Resource Department of ITVN, the voluntary turnover rate of total direct and indirect employees at ITVN is showed in Table 1 as below:
Table 1 Total employee turnover rate at ITVN
(Source: ITVN Human Resource Department) tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
Turnover rate is the percentage of the employees leaving the organization during a period of time
Turnover rate is calculated by using “the total number of employees leaving the organizations during the month divided by the average number of employees during the month”, postulated by
Phillips as cited by Hernández et al ( 2 )
In 2019, ITVN experienced a total employee turnover rate of 30%, marking a significant increase compared to the rates in 2017 and 2018, and indicating a consistent upward trend Additionally, a post-survey seminar report from Talentnet-Mercer in October 2018 revealed that the voluntary turnover rate among staff in multinational corporations rose from 15.1% in 2017 to 15.6% in 2018.
Figure 3 Turnover trend - Talentnet – Mercer post survey report 2018
Over the past four years, ITVN has experienced a notably high employee turnover rate, particularly in 2018 and 2019, when compared to both local companies and multinational corporations.
As ITVN is a representative office of Imperial Tobacco International Limited Company in United
Kingdom, a subsidiary of Imperial Brands, operates under the regulations of a multinational corporation Given that the cigarette and tobacco industry is heavily regulated by the Vietnamese government, Imperial Tobacco International must adhere to strict controls in its operations.
In the United Kingdom, a limited company can establish a representative office in Vietnam Although this office operates under a business license, ITVN is recognized as a multinational corporation, similar to its competitors like British American Tobacco.
(BAT), Phillip Morris International (PMI), and Japanese Tobacco International (JTI) Therefore, the employee turnover rate of ITVN can be compared with the staff turnover rate in MNC
In addition, the breakdown turnover rate data for 2018 and 2019 provided by Human Resource
The turnover rate at ITVN reveals a significant disparity between direct and indirect employees Over the past two years, the turnover rate for direct employees has remained below 10%, while indirect employees experienced a notably high turnover rate of 50% in 2018 and 64% in 2019.
The high turnover rate of indirect employees in the Data Analysis team at ITVN has significantly contributed to the overall turnover rate of the company, which rose from 23% in 2018 to 30% in 2019.
Table 2 Breakdown employee turnover rate at ITVN in 2018 and 2019
Yearly turnover rate in ITVN, breakdown by department
Turnover rate Average number of employee
(Source: ITVN Human Resource Department)
Besides, the post survey seminar report from Talentnet-Mercer in October 2018 ( 2 ) also showed that the highest turnover rate in 2018 is 37.6% belongs to Retail industry in Vietnam market (see
Figure 4) tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
Figure 4 Top 3 & Bottom 3 Turnover - Talentnet – Mercer post survey report 2018
ITVN is actively involved in the annual Talentnet-Mercer surveys focused on human resources topics, including compensation and benefits trends and voluntary staff turnover rates within the retail and tobacco industries The 2018 post-survey report, which analyzed data from 602 organizations across 16 industries, highlights the trends in voluntary staff turnover rates within these sectors.
In 2018, the turnover rate of the Data Analysis Team at ITVN was significantly higher than that of multinational corporations (MNCs), with rates of 50% compared to 15.6% Additionally, it was approximately 2.5 times greater than the turnover rate of local companies, which stood at 20.2%.
Data Analysis Team in 2018 is higher than the highest turnover rate in Retails industry in 2018 of
37.6% (Figure 4) In 2019, the turnover rate of Data Analysis Team at ITVN increased to 64%
(Table 2), that is a symptom needs to identify its problems and causes
As stated in Section 1.2 Organizational structure, Data Analysis team is indirect employees of
ITVN, whose employment contract has been signed with the labor supply agency of ITVN,
Humidor Despite signing labor contracts with the agency, Data Analysis Team is following the recruitment and training processes of ITVN, working in ITVN’s office, and reporting to ITVN’s
Business Intelligence Manager Thus, Data Analysis Team is reported as indirect employees of
ITVN covers the recruitment, training, and salary expenses for the Data Analysis team through an agency, indicating that this team is an integral part of ITVN's workforce and contributes to the overall employment costs.
ITVN faces rising employment costs due to changes in both direct and indirect employees, making effective workforce management essential for enhancing performance The high voluntary turnover rate within the Data Analysis Team indicates a pressing need for management to explore the underlying causes and develop targeted solutions to address this issue.
Symptom validation and justification
The Human Resource Department of ITVN has revealed in Table 2 that the Data Analysis team has experienced the highest turnover rate among all departments over the past four years Notably, the turnover rate for the Data Analysis team is more than double that of the overall turnover rate at ITVN, as illustrated in Table 3.
Table 3 Turnover rate of Data Analysis Team
Number of Data Analysis employee
Turnover rate of Data Analysis Team
Turnover rate of other Departments
Total Turnover rate of ITVN 15% 17% 23% 30% 6%
(Source: ITVN Human Resource Department)
In 2019, the turnover rate of the Data Analysis team reached 64%, significantly higher than the 50% recorded in 2018 and more than double the 29% from 2017, indicating a consistent upward trend since 2018 This turnover rate is the highest among all departments at ITVN and substantially exceeds the turnover rates observed in the retail industry.
The total turnover rate of ITVN is depicted in the chart below (Figure 5).
Figure 5 Turnover rate at ITVN
Though the interview, Ms Tran Hanh – HR Manager of ITVN, said that:
Recruitment through an agency incurs fees approximately equal to twice the monthly salary Additionally, the induction and training process for new hires typically takes around two months, during which overtime wages must be paid to existing staff to meet task deadlines This period also demands significant time investment from managers for interviewing and training new employees.
Mr Tran Son – Business Intelligence Manager of ITVN, shared his opinions:
The resignation of my team members significantly impacts me, as I must reassign tasks to others until we find replacements This process consumes my time with interviews, training, coaching, and assessing newcomers Typically, it takes at least 2-3 months for new hires to become familiar with their responsibilities.
Mr Andrew Wang, Director of ITVN, stated that the company's performance is declining due to significant expenses related to recruitment and training He emphasized that a higher turnover rate negatively impacts employee productivity.
The turnover rates for indirect and direct employees at ITVN are critical metrics to monitor Understanding these rates can provide insights into workforce stability and employee satisfaction It is essential to analyze the total turnover rate to identify trends and implement effective retention strategies.
Recruitment and training expenses are essential investments, but they can temporarily reduce overall team productivity New employees require time to acclimate to their roles, build rapport with colleagues, and effectively collaborate on tasks Additionally, existing team members must dedicate time to mentor newcomers, which can further slow down the team's workflow.
The Human Resource Department of ITVN reported the replacement costs incurred for recruitment and training, as well as overtime wages paid to other team members to ensure timely report completion Additionally, the data highlights the expenses related to facilities, including uniforms and working tools for the Data Analysis Team during the years 2018 and 2019.
Table 4 Replacement costs of Data Analysis Team
Replacement cost of Data Analysis team (in million dongs)
Year 2018 Year 2019 Increasing % of cost YoY
Total replacement cost of Data Analysis team 170 301 177%
Total Employee costs of Data Analysis team 1,872 1,950
Percentage of replacement cost in total cost of Data Analysis team 9.1% 15.4%
(Source: ITVN Human Resource Department)
In 2019, the replacement cost for the Data Analysis team surged by 177% compared to 2018, with the proportion of these costs rising from 9.1% of total employee expenses in 2018 to 15.4% in 2019 This indicates that ITVN incurred significantly higher expenses for replacing members of the Data Analysis team in 2019.
Labor costs play a crucial role in a company's performance, as highlighted by Michael et al (4) One significant factor impacting this performance is the loss of human capital due to unnecessary employee turnover.
Employee turnover incurs both significant tangible costs and hidden expenses, as highlighted by Lashley and Chaplain (cited by Michael et al.) Tangible costs include termination, advertising, recruitment, selection, hiring, training, and assignment expenses However, hidden costs also play a crucial role, encompassing disruptions in customer relations, decreased morale among remaining employees, and the valuable time lost as new hires acclimate to their roles and reach optimal efficiency.
The interview results and data from the Human Resource Department at ITVN reveal that the visible replacement costs of the Data Analysis team can be quantified, while hidden costs, such as decreased employee productivity and managerial time loss, remain unmeasurable Given that the turnover rate for the Data Analysis team is the highest among all departments at ITVN and is on the rise, further investigations are warranted to address the underlying causes of this high turnover rate.
PROBLEM IDENTIFICATION
Problem mess
To investigate the factors contributing to the high turnover rate in the Data Analysis team at ITVN, qualitative research methods were employed, including in-depth interviews with three distinct groups The first group comprised three individuals in managerial positions, including Ms Tran Hanh.
The article discusses key personnel involved in the Data Analysis team, including HR Manager Mr Tran Son, Business Intelligence Manager Mr Andrew Wang, and the current employees of the team, as well as those who have previously left.
Ms Tran Hanh – HR Manager, shared the results from her exit interviews that people left Data
The analysis team is experiencing higher job satisfaction due to better salaries and benefits However, employees in the Data Analysis team are leaving their positions primarily due to low pay and unequal benefits, leading to dissatisfaction.
In an interview with Mr Tran Son, Business Intelligence Manager, key factors contributing to employee turnover were identified, including low salaries, lack of career advancement opportunities, and job instability Mr Tran highlighted that members of the Data Analysis team are particularly affected by job insecurity and the absence of a retention plan, leading to disengagement from the company.
Mr Andrew Wang, the Director, believes that the workplace conditions contribute to the Data Analysis team's disconnection from other employees He suggests that the team's need for a quiet working environment to concentrate on their tasks may lead to lower engagement with other departments within the company.
Interviews with current and former members of the Data Analysis team reveal key reasons for their decision to leave, including low salaries, inequitable benefits, feelings of isolation from other departments, job insecurity, a lack of retention strategies, and limited opportunities for career growth and development.
With all the information collected from the first round interviews with the HR Manager, the
The Business Intelligence Manager, along with the Director and both current and former members of the Data Analysis team, plays a crucial role in enhancing organizational problem-solving capabilities, as outlined in Joan Van's book, "Problem Solving in Organizations."
Aken and Hans Berends - Third edition 2018 (item 4.3, page 55-58) ( 6 ), the potential problems can be described in the preliminary cause and effect tree as below:
Working apart Poor Working environment
High turnover rate of employee Increase recruitment and training costs
The preliminary cause and effect tree for the thesis download is now available, featuring the latest updates and full content For access, please contact via the provided email.
Potential Problems and validate the main problem
The preliminary cause and effect map reveals three key issues contributing to the high turnover rate in the Data Analysis team at ITVN: income dissatisfaction, a poor working environment, and low motivation levels A deeper analysis of the interview results, alongside relevant literature, will help identify the primary factors driving this turnover.
Salary is a fixed amount of money paid to workers, typically measured on a monthly or yearly basis, serving as compensation for their work (Mercy et al.) It plays a crucial role in job satisfaction, organizational commitment, and voluntary turnover (Matz et al and Crow et al as cited by Schuck et al.) Additionally, salary and satisfaction with salary are key factors in attracting and retaining employees (Carraher) Furthermore, salary and benefits are linked to pay satisfaction, with a positive relationship between income and overall satisfaction (Luna-Arocas et al.).
Low salaries and uncompetitive benefits contribute to employee income dissatisfaction, which in turn decreases retention rates Consequently, when employees are unhappy with their compensation, they are more likely to seek alternative job opportunities for better financial rewards.
In an interview with Ms Tran Hanh, the HR Manager, it was revealed that income dissatisfaction is a key factor contributing to the turnover of employees in the Data Analysis team.
In exit interviews, employees often cite higher salary job offers as a reason for leaving the company, while others express dissatisfaction with their current benefits.
An employee who is currently working in Data Analysis team – Mr Nguyen Tung, shared his opinion about the salary:
“My salary is not very attractive I know that the salary will be reviewed and increased every year, but the percentage of increasing is not much”
The results from interviews with another employee – Mr Nguyen Thien, who already left Data
Analysis team, indicated that he did not happy with his salary and benefits He shared:
The salary offered is less than my current position, and the benefits are not appealing There is no annual performance bonus, aside from the thirteenth-month salary.
In addition, Mr Tran Son – Business Intelligence Manager, shared his view on the reason that leads to the high turnover rate in Data Analysis team:
“Data Analysis team has the highest turnover rate When leaving, people usually told me that they have a better job with higher salary”
Higher salary levels are linked to reduced voluntary turnover, as noted by Schuck et al (8) Additionally, Mercy et al (7) highlighted that competitive salaries enhance employee satisfaction and happiness, leading to improved efficiency and better retention rates.
The analysis of the interview results indicates that low salaries and unappealing benefits contribute to income dissatisfaction among employees.
Data Analysis team at ITVN quit their jobs
However, from the in-depth interviews, it is found that there is a procedure of appraisal, reviewing and increasing salary at ITVN Besides, ITVN conducts annual salary surveys with Talennet-
Mercer provides valuable insights for determining employee salaries through annual salary surveys conducted by Talentnet-Mercer across various industries, including the tobacco sector These surveys compile a comprehensive database of salary rates for each job code, serving as a reference for companies ITVN has access to this salary database, allowing them to search for salary ranges associated with specific job codes and levels, facilitating effective salary benchmarking within the tobacco industry.
Ms Tran Hanh – HR Manager, stated that:
Our organization conducts an annual performance review process for all employees, both direct and indirect, to evaluate their performance and assess salary adjustments Salary increases are determined by individual contributions and are aligned with market standards, utilizing salary survey reports from Mercer-Talentnet for benchmarking.
Besides, Mr Andrew Wang – Director, shared his opinion that when employees agree to join the company, it means they accept their salary He said:
Employees have expressed concerns about low pay compared to others; however, we have conducted a thorough benchmarking of all salaries against market and industry rates By accepting their offer letters to join our organization, they acknowledged and agreed to the proposed salary rates.
In addition, the interviews with two employees who are currently working in Data Analysis team disclosed that they are quite happy with their salary
Ms Nguyen Truc – who has been working in Data Analysis team for three years, shared her thought:
“I have yearly salary reviewed and increased, so I think my salary is acceptable”
Sharing by Mr Phan Nhan, who has joined Data Analysis team for six months:
Having recently graduated a year ago, I am pleased with the salary offered by my company I recognize the importance of gaining more experience to enhance my career prospects.
Ms Doan Hang – employee has left Data Analysis team, revealed that:
“The salary there is higher than my current salary, but I am happy with my current job”
Furthermore, Mr Andrew Wang – Director, shared his view:
It is essential to adhere to our Group's policies regarding the employee performance evaluation process, as all salary information is submitted to the Group Compliance with these policies is a priority to ensure we meet organizational standards.
In addition, Ms Tran Hanh – HR Manager, stated:
Our company's salary rates are competitive and align with market standards, as indicated by salary surveys However, some employees may feel dissatisfied with their compensation due to a lack of awareness about market rates and having elevated salary expectations.
The in-depth interviews reveal a conflict in salary perceptions among employees in the Data Analysis team at ITVN Additionally, insights from the HR Manager and the Director indicate that ITVN's salary appraisal and pay raise processes are governed by the Group, making salary issues beyond the scope of this report.
Another factor that can affect to the turnover rate of the company is working environment
Updated preliminary cause and effect map
From the interview results and combined with literature review, the preliminary cause and effect map is updated as below:
High turnover rate at Data Analysis team
Low employee productivity Unequal benefits
Increase recruitment and training cost
The updated preliminary cause and effect map provides insights into the latest developments in the field For those interested, the full document can be downloaded via the provided email address This resource is essential for understanding the nuances of the research and its implications.
Problem justification
In summary, the high voluntary turnover rate in the Data Analysis team at ITVN can be attributed to three key issues: income dissatisfaction, an unfavorable working environment, and a lack of motivation.
There is a conflict within the Data Analysis team at ITVN regarding income dissatisfaction, with some employees expressing concerns about their salaries while others are content The Director and HR Manager have stated that the company follows a procedure for annual performance evaluations and salary increases, adhering to Group policies, which limits their ability to address the income dissatisfaction issue However, employees in the Data Analysis team report satisfaction with their tasks, working conditions, and relationships with colleagues and managers, indicating that the perception of the working environment may be a contributing factor to the dissatisfaction.
Interviews with the Data Analysis team at ITVN highlighted that inequity in benefits, lack of career development plans, and job insecurity are significant factors contributing to employee dissatisfaction and an increased intention to leave the company These issues notably diminish their motivation to work.
Mr Nguyen Thien – left employee, shared his thought:
“I feel unhappy that the benefits of our team is lower than the others in the same office”
Ms Nguyen Truc – existing employee, shared her concerns:
“I am worried about my future since I have unsecure job and no career development plan, that makes me demotivated”
Mr Nguyen Tung – existing employee working in Data Analysis team, stated:
“There is no career development, no career growth opportunity here No career development plans reduces my working inspiration and demotivates me”
The interview with Ms Tran Hanh, the HR Manager, highlighted key factors contributing to the high turnover rate in the Data Analysis team.
The lack of equitable benefits and the absence of a retention plan have led to demotivation among the Data Analysis team, significantly contributing to their high turnover rate It is essential to identify solutions that can inspire and uplift their work morale to effectively reduce this turnover.
Employee motivation is crucial for maintaining a positive work spirit, especially in challenging situations, as noted by Keighley and cited by Joshua-Amadi (20) Conversely, a lack of motivation can lead to non-constructive behavior, frustration, and negative attitudes, which hinder productivity and contribute to higher staff turnover and increased company costs.
Tokarz-Kocik (16) emphasized that employee motivation significantly influences how individuals approach their responsibilities Poor motivational strategies can result in high turnover rates, which is a critical issue for organizations Specifically, a lack of motivation is identified as a primary factor contributing to elevated turnover rates within the Data Analysis team, ultimately impacting the financial performance of ITVN.
Research indicates a significant relationship between turnover rates and various organizational factors, including productivity, employee retention, work quality, and overall company strategy Higher turnover rates lead to decreased employee productivity, ultimately jeopardizing the company's success To maintain a competitive edge, organizations must prioritize employee motivation and engagement, as employees are essential to the organization's foundation When motivation wanes and employees leave, it not only threatens organizational success but also diminishes productivity and demoralizes remaining staff.
When being asked for the consequences of high turnover rate in Data Analysis team, Mr Andrew
Wang, the Director, revealed that ITVN's replacement costs rose significantly from 170 million Vietnam dongs in 2018 to 301 million Vietnam dongs in 2019, as shown in Table 4 This increase not only impacts the company's financial performance but also affects the morale and productivity of other employees, leading to higher investment expenditures for ITVN.
High turnover rates lead to increased replacement costs and diminished work quality, negatively impacting the morale of remaining employees Accurate reports are crucial for making informed investment decisions aimed at expanding our market share in Vietnam Any delays or errors in these reports can result in poor decision-making and higher investment expenditures.
27 company’s profits We need to find the root cause of this problem I fully support to improve the turnover rate within my approval boundary”
Therefore, in order to maintain a stable workforce and sustain the company performance, ITVN should find ways to motivate Data Analysis team.
CAUSE VALIDATION
Potential causes
Herzberg et al., as referenced by Tietjen et al., identified two categories of factors influencing motivation: job factors and extra-job factors Job factors encompass recognition, achievement, opportunities for growth, advancement, responsibility, and the nature of the work itself In contrast, extra-job factors include income, interpersonal relationships, company policies and administration, working conditions, and job security.
Job factors encompass intrinsic motivation, while extra-job factors pertain to extrinsic motivation (Tietjen et al., 23) Intrinsic motivation is defined as engaging in an activity for its inherent satisfaction, as described by Ryan and Deci (Jungin, 24), whereas extrinsic motivation involves performing tasks for separable outcomes According to Joshua-Amadi (20), extrinsic motivators include tangible rewards such as pay, job security, and favorable working conditions, while intrinsic motivators consist of intangible rewards like personal growth, recognition, and a sense of achievement Marco et al (25) highlighted that career growth opportunities enhance intrinsic motivation by increasing the likelihood of enjoyable future tasks, and the perceived fairness of compensation significantly influences extrinsic motivation Jungin (24) assessed intrinsic motivation through employees' perceptions of future opportunities and their satisfaction in their work, while extrinsic motivation was measured by salary, benefits, and work-life balance Ultimately, intrinsic motivation is driven by internal satisfaction, whereas extrinsic motivation is fueled by external rewards.
Motivation can be categorized into two main types: intrinsic and extrinsic At ITVN, intrinsic motivation is influenced by factors such as the absence of career development plans.
28 no career growth opportunity; while extrinsic motivation includes inequity benefits and job insecurity
Intrinsic motivation, as described by Ryan et al (26), refers to the intangible rewards stemming from an individual's inherent interest in their work, driving employees to perform for their own benefit.
Organizations aim to attract talent by providing intrinsic rewards such as meaningful work, career advancement, and opportunities to make a difference (Twenge et al., 27) However, the Data Analysis team at ITVN lacks career development plans and growth opportunities, resulting in employee dissatisfaction This highlights the significant role of intrinsic motivation in enhancing work motivation among employees.
Ms Doan Hang – left employee, shared her opinion on the worst point makes her dissatisfied when working at ITVN:
“No career development No future growth We are unequally treated, this makes me feel unhappy and disappointed”
She also said about the benefits and career growth opportunities in her new company:
“I am an official staff of my current company, I receive all benefits as other people here If I work well, I will have opportunities for my career growth”.
Ms Nguyen Truc – existing employee, shared her concerns:
“I don’t see any development plan in my career, as I am doing the same tasks in the past two years
Though my line manager teaches me a lot in my works, but I don’t see any career growth opportunity here”
Further interviews with the managers at ITVN has revealed some information about the intrinsic motivation in the company
Ms Tran Hanh - HR manager, stated about career development at ITVN:
“We currently have no development plans for indirect employees as they are considered as short- term workforce”
Besides, Mr Tran Son – Business Intelligence Manager, gave his opinion about retention plan for
Data Analysis team in ITVN:
The Data Analysis team lacks an effective retention plan, leading to feelings of disengagement from the company.
Tokarz-Kocik (16) emphasizes that providing opportunities for employees to develop their qualifications is a key motivator He notes that, aside from low salaries, limited promotion and career development opportunities are significant factors driving employees to leave a company When organizations offer avenues for knowledge enhancement, it fosters employee motivation and engagement Conversely, a lack of career growth opportunities can prompt employees to seek employment elsewhere Additionally, Abdul Kadar et al (18) highlight that career development plans are crucial for retaining employees within organizations.
The findings from interviews and literature reviews indicate that a lack of intrinsic motivation, stemming from the absence of career development plans and growth opportunities, contributes to the turnover of employees in the Data Analysis team at ITVN.
4.1.2 Low level of Extrinsic motivation:
Through the interviews, it can be seen that at ITVN, the low level of extrinsic motivation in Data
The analysis team highlights issues of benefit inequity and job insecurity, primarily stemming from differing policies for direct and indirect employees Additionally, the one-year contract terms for indirect employees contribute to a sense of instability, negatively impacting their motivation and overall work spirit.
The interviews with employees working in Data Analysis Team revealed some information about the extrinsic motivation factors at ITVN
Mr Nguyen Tung – existing employee working in Data Analysis team, shared his thought about the inequity in benefits at ITVN:
“Our team don’t have some benefits that others have, this makes us feel unequally treated and demotivated”
Ms Doan Hang – employee has left Data Analysis team, stated that:
“We know that our team has less benefits than others although we are working in the same office”.
Besides, Ms Nguyen Truc – existing employee, shared her concerns about the job insecurity:
“I really don’t know what I will be in the next three years And I am not sure if the company wants to maintain this team for long term”
Mr Nguyen Tung, a current member of the Data Analysis team, shared his insights on the latest developments in data analysis and the importance of staying updated with current trends and tools in the field.
The future of our team at the company is uncertain, as it appears that a strategic shift may render our services unnecessary This situation leaves me feeling uneasy and demotivated.
Furthermore, the interviews with Managers showed that Data Analysis team at ITVN has benefits inequity and job insecurity
Ms Tran Hanh – HR Manager, said:
The Data Analysis team, being indirect employees, lacks the same benefits as direct employees in the representative office, including comprehensive healthcare insurance for their families and additional allowances exclusive to direct staff.
Mr Tran Son – Business Intelligence Manager of ITVN, shared his thoughts:
The one-year labor contracts create a sense of job insecurity among my team members, leading them to feel unsafe in their careers This feeling of instability is the primary reason many choose to leave the company.
Lazaroiu (17) noted that employee dissatisfaction with equity can result in demotivation and prompt individuals to leave the company Consequently, unequal benefits within the organization may contribute to employee dissatisfaction, ultimately increasing turnover rates.
Furthermore, Ashford et al as cited by Holm et al ( 19 ) stated that staff who felt insecure about their jobs left companies to search for more carrier opportunities
The findings from interviews and literature reviews indicate that a low level of extrinsic motivation, driven by perceived benefit inequity and job insecurity, contributes to the turnover of employees in the Data Analysis team at ITVN.
Cause justification
In conclusion, the interview findings and literature review indicate that the high turnover rate in the Data Analysis team at ITVN is primarily driven by two factors: a lack of intrinsic motivation and a low level of extrinsic motivation.
According to Mafini et al (28), Herzberg's Two-Factor Theory of Motivation identifies intrinsic factors as key motivators, while extrinsic factors serve to ensure the achievement of external goals.
Pay, encompassing salaries, bonuses, and benefits, serves as a significant motivator for employees, as highlighted by Joshua-Amadi (20) Financial rewards can transform mundane tasks into worthwhile endeavors, suggesting that employees often rely on extrinsic incentives to enhance their work experience before they can fully appreciate intrinsic rewards Additionally, Lazaroiu (17) emphasizes that, according to Maslow’s hierarchy of needs, employees prioritize fulfilling external needs, including basic physiological requirements and safety concerns such as job security and health insurance This perspective aligns with Adams’ Equity Theory, which underscores the importance of perceived fairness in the workplace.
Increase Investment spending and Reduce Company Profit
Increase Turnover Rate of Data Analysis team
Figure 8 Cause and effect map tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
32 difficulties with inequity can lead employees to reduce their work to eliminate inequity, stated by
Employees at ITVN's Data Analysis team exhibit low levels of extrinsic motivation due to perceived inequities in benefits and job insecurity This lack of extrinsic motivation leads to demotivation among staff and contributes to a higher turnover rate It appears that employees must first achieve satisfaction with extrinsic factors before they can engage their intrinsic motivation effectively.
Therefore, it is crucial for ITVN to find solutions to improve benefits for employees in Data
Analysis team as well as make them feel reliable on their job
Interviews with the Manager at ITVN indicated that intrinsic motivation falls outside the Management Team's purview, as it necessitates Group approval for any indirect employee development plans.
Ms Tran Hanh – HR Manager of ITVN, shared her opinion when being asked for the career development plan and career growth opportunity for Data Analysis team She said:
Currently, we have well-defined development plans for representative office employees, but not for agency employees, who are classified as indirect employees Our Group is not prioritizing investment in indirect employees, making it challenging to include them in career development plans unless they are directly employed by the representative office.
According to Mr Tran Son - Business Intelligence Manager, it is necessary to have a long term strategy for employee growth, but difficult in this situation He shared:
“Understand that in this situation, it is difficult for us to have a clear career path plan for my team
But I think we should have a long term strategy for employee growth so that they feel engaged with the company”
Moreover, Mr Andrew Wang – Director, shared his thought:
At this time, I am not looking to increase direct employees due to the need for Group approval for additional headcounts However, I will incorporate a long-term strategy into the Business Plan for the next five years, which includes plans for business expansion and organizational growth.
Then once we have Group approval for the Business Plan, we will definitely cover the development plans for all the employees”
ITVN's career development plans and growth opportunities for employees are integral long-term strategies aligned with the company's Business Plan and require Group approval The Director has shared that the company is planning an expansion strategy that includes enhanced career growth opportunities for its employees.
33 solution for solving the cause of lack of intrinsic motivation is included in the Business Plan of
ITVN Therefore, the Management of ITVN need to focus on improving extrinsic motivation to motivate and retain the employees in Data Analysis team.
ALTERNATIVE SOLUTIONS
Alternative solution 1: Eliminate benefits inequality
At ITVN, inequity in benefits significantly diminishes motivation among employees in the Data Analysis team When employees perceive inequity, they may lower their contributions, negotiate for better compensation, or even decide to leave the organization, as suggested by Lazaroiu According to Adams’ Equity Theory, employees assess their reward-to-contribution ratios, and if they find disparities compared to their peers, they may reduce their efforts or resign, as noted by Bing et al This inequity can lead to decreased productivity and increased turnover intentions Furthermore, benefits are closely linked to job satisfaction, which influences employee performance and organizational commitment, according to Odunlade Therefore, ITVN should enhance the benefits for the Data Analysis team to mitigate inequity and boost employee motivation.
Ms Tran Hanh, the HR Manager, noted that exit interviews with departing employees indicated that dissatisfaction with benefits is a significant factor influencing their decision to leave the company.
People working in Data Analysis team are indirect employees, so they receive different benefits comparing to the direct employees She said:
The Data Analysis team, being indirect employees, lacks the same benefits as direct employees in the representative office, including comprehensive healthcare insurance for their families and additional allowances.
Mr Phan Nhan – existing staff working in Data Analysis team, gave his opinion when being asked for giving suggestions to improve job satisfaction:
The company should revise its policies to ensure they apply equally to all employees, regardless of whether they are based in the representative office or are agency staff, as everyone contributes to ITVN Furthermore, we seek to increase collaborative activities to foster a sense of unity and teamwork among all staff members.
Besides, Mr Nguyen Thien – left employee, shared his thought about the benefits inequity:
“Some benefit policies are applied for only representative office people and that is unfair for us since we are working for the same organization in the same office place”
In addition, Mr Nguyen Tung – who is working in Data Analysis team for a year, gave his opinion:
I am interested in understanding the company's strategies to identify potential growth opportunities While the development plan is implemented for the representatives in the office, it does not extend to our team, leaving me uncertain about our future prospects.
Addressing benefits inequality requires not only policy changes but also a shift in employee mindset regarding equal treatment To foster a sense of unity among all employees, both direct and indirect, the company should implement regular engagement activities, such as monthly meetings for experience sharing and discussing company strategies By transparently communicating the Business Expansion Plan, employees will feel more secure in their roles, knowing the company is invested in their future careers This approach will boost motivation and enhance overall contributions to the organization.
To address benefits inequality, the company should revise its policies to ensure that all direct and indirect employees receive equal benefits and allowances Additionally, organizing regular activities, such as monthly meetings, will enhance employee engagement and communicate the company's future growth strategies This approach will foster a sense of fairness and job security among the Data Analysis team, ultimately boosting their motivation.
Create a climate of trust, and fairness in the company
Increase performance and commitment of employees to the company
Encourage the willingness of employees to help each other
Improve the benefits inequality gap to increase employees motivation
Increase interactions and engagements among office staffs and managers
Knowing about the company future plans to contribute their best efforts to the company’s success
Reduce voluntary turnover and absenteeism
Ms Tran Hanh, the HR Manager, highlighted that indirect employees at ITVN lack certain benefits, including annual health checkups, healthcare insurance for family members, and various allowances that direct employees receive To address this disparity, she has outlined the costs required to extend additional benefits to indirect employees, aiming to align their benefits with those of direct employees, along with expenses for engagement meetings.
Table 5 Costs to implement solution 1
No Description Unit Quantity Cost per unit
Estimated cost per year (Vnd)
1 Annual Healthcare Insurance for family members
3 Annual allowances (birthday gift, New Year gifts)
(Source: ITVN Human Resource Department) tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
Alternative solution 2: Ensure the employees’ job security
Job insecurity can significantly impact employee performance, leading to reduced effort, increased stress, and mistakes, ultimately resulting in lower productivity According to Holm et al (19), when employees feel that their job is not secure, they are more likely to seek alternative employment If they perceive a lack of commitment from the company to retain them, they may not see the value in increasing their efforts, which can further diminish productivity and negatively affect overall company performance To mitigate these issues, it is essential for companies to address job insecurity, ensuring that employees feel secure and valued in their roles.
At ITVN, employees in the Data Analysis team are concerned about job security due to their one-year agency contracts, which they perceive as short-term Interviews reveal that this uncertainty affects their overall sense of stability in the workplace.
ITVN shared their desire to have a long-term employment contracts to make them feel stable and secure in their career
When being asked to give suggestion to improve job satisfaction, Ms Nguyen Truc – existing employee in Data Analysis team, shared her thought:
I am eager to leverage my expertise for the long-term benefit of the company, which is why I seek a long-term labor contract to ensure stability and peace of mind regarding my future.
Ms Tran Hanh, the HR Manager, suggested that the turnover rate in the Data Analysis team could be improved by offering permanent employment contracts to team members who meet the necessary qualifications.
Mr Tran Son, the Business Intelligence Manager, recommends that the company implement permanent labor contracts for the Data Analysis team to enhance their turnover rate.
I am collaborating with the management team to develop strategies for the next five years To support this initiative, we require a data analysis team for at least three additional years Therefore, I recommend establishing permanent labor contracts for my team.
Thus, ITVN needs to get the employment contracts signed with the employees working in Data
Analysis team for a long-term period to make them feel assured and stable in their job
Mr Andrew Wang, the Director of ITVN, has stated that he is not looking to increase the number of direct employees at this time, as he requires Group approval for any additional headcounts This decision aims to maintain job security for current employees.
The Data Analysis team at ITVN is finalizing their employment contracts for permanent or indefinite terms, which are characterized by the absence of a specific termination date According to Kozjek et al (31), permanent contracts are perceived as more secure and stable, leading employees with such contracts to rate their job security higher than those with other types of employment agreements This enhanced job security fosters greater employee engagement and effort within the company Furthermore, as noted by Muhammad et al., job security not only motivates employees but is also a crucial factor influencing job performance, linking motivational elements to overall performance outcomes.
Improving employability is a key strategy for ensuring job security, as employees actively seek training opportunities to prepare for better positions (Vilde Hoff et al.) Employers tend to offer training and development to those on permanent contracts, anticipating a longer tenure with the company (Forrier and Sels, as cited by Vilde Hoff et al.) Consequently, implementing training programs enhances employees' competencies and competitiveness, ultimately increasing their employability and reducing job insecurity Specifically, providing training for Data Analysis staff at ITVN can help bridge the benefit gap between indirect and direct employees.
Reinforce the feeling of job security of the indirect employees to reduce their spending time search for alternative jobs
Improve employees skills which benefits for employees and enhance their employability
Reduce benefits inequality between indirect and direct employees
Enhance employees motivation, increase their productivities
Reduce employees’ voluntary turnover Costs:
According to Ms Tran Hanh, the HR Manager, the agency plans to raise its annual fees by half a month's salary for the responsibility of signing permanent labor contracts with employees Additionally, ITVN is prepared to invest in external resources for the latest soft downloads related to their operations.
The article discusses 38 skills training courses designed for indirect employees, with a budget capped at 5 million per year Due to the inability of indirect employees to access the existing e-learning platform of Imperial Brand, the costs associated with agency fees for long-term contracts aimed at enhancing employee skills are outlined.
Table 6 Costs to implement solution 2
No Description Unit Quantity Cost per unit
Estimated cost per year (Vnd)
1 Agency fee for signing permanent contracts
Solution justification
To address benefits inequality, revising current policies and organizing monthly engagement meetings to communicate company strategies to all employees is an effective solution that enhances extrinsic motivation.
- Increasing the benefits for employees working in Data Analysis team makes them feel equally treated same as others
Sharing the company's long-term strategies and expansion plans fosters employee engagement and security, as it provides insight into the future growth of both the organization and their individual careers.
Signing permanent labor contracts enhances job security for employees As the company gears up for a business expansion plan, the potential increase in direct employees is on the horizon Once the business plan receives approval, ITVN will directly sign labor contracts with Data Analysis staff, transitioning them to direct employees However, this shift will incur costs for ITVN as it will need to terminate existing agency contracts.
Providing skill training courses enhances employee competencies and helps address current inequalities in benefit policies This investment in employee development not only boosts individual performance but also contributes to long-term organizational success.
Currently, employees in the Data Analysis team can compare their benefits with those of other direct employees Additionally, indirect employees who sign contracts directly with ITVN gain access to the e-learning platforms used by direct employees at Imperial Brands, ensuring equal benefits for all staff.
Ms Tran Hanh - HR Manager, gave her opinions on the priority of the suggestions to improve the turnover rate:
To address the inequality gap, it is essential to enhance the benefits for indirect employees Once we receive Group approval to increase our workforce, we can directly sign labor contracts with new hires, eliminating the need for agency involvement.
Mr Andrew Wang, the Director, expressed his preference for Solution 1 to address benefits inequality, citing its ease of control and cost monitoring for the company.
Fair treatment of employees is essential to prevent comparisons among them Enhancing benefits for indirect employees can boost their satisfaction and motivation This approach is cost-effective and easier to justify compared to the complexities of altering labor contracts and monitoring training expenditures and outcomes.
Moreover, a small survey was conducted with all the employees working in Data Analysis team at
A questionnaire featuring four statements about proposed solutions was administered to twelve employees, utilizing a five-point Likert scale to gauge their opinions, ranging from strongly disagree (1) to strongly agree (5) These statements were adapted from various theories to align with the research objectives, aiming to identify the most effective solution for implementation The first statement was specifically modified based on established instruments.
The Pay Satisfaction Questionnaire, analyzed by Carraher, and the Attitudes Towards Benefits Scale, measured by Carraher et al., provide insights into employee satisfaction Additionally, Kumar et al developed a framework to assess employee engagement, aiming to improve job satisfaction and work motivation.
The third statement is based on the Psychological Contract theory, which explores an individual's beliefs regarding the mutual agreement with their organization, as examined by Chambel et al The fourth statement focuses on measuring employer-supported training aimed at enhancing employability and job security, as suggested by Vilde Hoff et al The relevant questionnaire is presented in the table below.
No Code Statement Adapted from
1 S1 Increasing benefits makes you satisfied and motivated at work
Carraher ( 34 ) and Carraher et al ( 35 )
2 S2 Enhancing engagement increases your job satisfaction and makes you motivated to work
3 S3 Signing a permanent labor contract enhances your job security and increases your motivation to work
4 S4 Providing skills training courses to enhance your employability makes you feel safe in your job and increases your motivation to work
The survey results indicate that the first statement received the highest mean score of 4.42, suggesting that respondents generally agree to strongly agree with it In contrast, the second statement had an average score of 3.92, reflecting a general agreement among employees.
The first solution for addressing benefits inequality is favored by employees, as both the first and second statements are connected to this solution.
No Statement Code Mean Standard
(Source: Excel’s results) tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
Revising company benefits policies and sharing strategies through engagement meetings can effectively reduce benefits inequality between direct and indirect employees This approach will enhance job security for the Data Analysis team, fostering a sense of fair treatment and career stability As a result, employee motivation will increase, and the intention to leave the company will decrease.