ĐẠI HỌC QUOC GIA HÀ NOI KHOA QUAN TRI VÀ KINH DOANHSRR 33 oe TRINH THI HANG THE IMPACT OF HUMAN RESOURCE MANAGEMENT PRACTICES ON THE ORGANIZATIONAL COMMITMENT OF MEDICAL REPRESENTATIVES
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2.1.1 Concept of human resources and human resource management
Human resources refer to the collective workforce of an organization, industry, or economy The term emerged in the 1960s, highlighting the growing importance of labor relations and the development of concepts like motivation, organizational citizenship behavior, and selection evaluation across various work environments.
HRM was defined by many authors in various ways and various words But how to manage people or employees in an organization is still the core value of HRM.
Human Resource Management (HRM) is defined as a strategic and cohesive method for managing an organization’s most valuable asset—its people According to Michael Armstrong (2006), these individuals, both individually and collectively, play a crucial role in achieving the organization’s objectives.
Edwin Flippo defines Human Resource Management (HRM) as the systematic process of planning, organizing, directing, and controlling various aspects of human resources This includes procurement, development, compensation, integration, maintenance, and separation of personnel, all aimed at achieving individual, organizational, and social objectives.
The National Institute of Personal Management (NIPM) in India defines human resources management as a vital aspect of management focused on employee relations within an organization Its primary goal is to cultivate a productive workforce while prioritizing the well-being of individuals and teams, ultimately empowering them to contribute effectively to the organization's success.
According to Decenzo and Robbins, “Human Resource Management concerns the people dimension” in management Since every organization is made
THEROTICAL BACKGROUND OF THE RELATIONSHIP
Concept of human resources and human resource management
Human resources refer to the collective workforce of an organization, industry, or economy The term emerged in the 1960s, highlighting the growing importance of labor relations and the development of concepts such as motivation, organizational citizenship behavior, and selection evaluation across various work environments.
HRM was defined by many authors in various ways and various words But how to manage people or employees in an organization is still the core value of HRM.
Human Resource Management (HRM) is a strategic and cohesive method for managing an organization’s most valuable assets—its employees—who play a crucial role in achieving the organization's goals (Micheal Armstrong, 2006).
Edwin Flippo defines Human Resource Management (HRM) as the systematic approach to planning, organizing, directing, and controlling various aspects of human resources This includes the procurement, development, compensation, integration, maintenance, and separation of employees, all aimed at achieving individual, organizational, and social objectives.
The National Institute of Personal Management (NIPM) in India defines human resources management as the aspect of management focused on the workforce and their interactions within an organization Its primary goal is to assemble and nurture a talented team while prioritizing the well-being of individuals and groups, ultimately empowering them to contribute effectively to the organization's success.
According to Decenzo and Robbins, “Human Resource Management concerns the people dimension” in management Since every organization is made
To achieve organizational objectives, it is crucial to engage individuals by acquiring their services, enhancing their skills, motivating them to excel, and ensuring their ongoing commitment to the organization This principle applies universally across various sectors, including government, business, education, healthcare, and social initiatives.
To summarize, HRM is the process of acquiring, training, appraising, and compensating employees, and of attending to their labor relations, health and safety, and fairness concerns.
Human Resource Management (HRM) encompasses various detailed activities, primarily categorized into three functional groups One key function is human resource attraction, which ensures that the organization has an adequate number of employees with the necessary skills to meet its business objectives To effectively recruit the right individuals for the right roles, firms must analyze their production and business plans alongside the current workforce situation to identify areas where additional personnel are needed.
Job analysis is essential for firms to determine their recruitment needs and selection criteria Utilizing effective recruiting skills, such as interviewing and multiple-choice assessments, enables the identification of the best candidates Key activities in this function include human resource forecasting and planning, job analysis, interviewing, and data management Meanwhile, the training and development function aims to enhance employee competencies, ensuring they possess the necessary skills to perform their tasks effectively Companies conduct training and orientation for new hires to assess their capabilities and acclimate them to the work environment Additionally, ongoing training and retraining initiatives are planned to address changes in production demands or technological advancements.
To enhance workforce efficiency, it is essential to implement eight practical skills that orient, educate, and train employees, while also updating managerial knowledge and qualifications A key aspect of this strategy is the human resource retention function, which focuses on effectively utilizing and retaining talent within the organization This function encompasses two critical components: motivating and mobilizing employees, as well as fostering and maintaining positive relationships within the workplace.
2.1.1.3.1 The Michigan model of HRM
The Michigan Business School in the United States developed the Michigan model, also known as the "Best-Fit" model, in 1984, founded by Fomburn, Tichy, and Devanna This model represents a hard approach to human resource management, emphasizing the treatment of staff as a means to achieve the firm's strategic goals Hard HRM prioritizes viewing employees as resources to be utilized in a calculative and rational manner, contrasting with the softer approaches that focus more on employee welfare and development.
The model is structured around four key principles: recruitment and selection, performance evaluation, compensation, and career development and training, depicted as a triangle with the organization at its center This central position highlights the firm as the hub of all business activities, surrounded by internal and external factors that influence operations Each element is interconnected and significantly affects business activities Management establishes the corporate mission, strategy, and structure, subsequently designing and integrating human resource management (HRM) to align with business needs It is crucial for internal factors to effectively adapt to changes in the external environment, including political, economic, and cultural influences, with HRM serving as a vital component tailored to the business's requirements.
The Michigan model emphasizes the human resource cycle, which consists of four key functions that impact both individual and organizational performance Each function is strategically aligned with business objectives As depicted in Figure 2.2, the cycle begins with "selection," which involves identifying talented individuals who can fulfill job requirements established by the organizational structure Additionally, "performance" serves as the core function of human resource management (HRM), ensuring that HR practices are effectively linked to business demands.
Appraisal connects employee performance to business objectives, while rewards recognize achievements and motivate staff Development and training provide opportunities to enhance performance and competencies, serving as feedback for developmental needs The central focus of this cycle is performance, with all activities aimed at boosting both individual and organizational effectiveness, ensuring that employee performance aligns with company requirements.
Figure 2.2: The Michigan model — The human resource cycle
Source: Fombrun, Tichy, and Devanna (1984).
2.1.1.3.2 Models of HRM in Vietnam
Dung T K (2011) has adopted the Michigan model of HRM in Vietnam situation and proposed the model presented as Figure 2.3a and Figure 2.3b It’s described by some main following characteristics:
Firstly, HRM is implemented as a functional strategy.
Secondly, HRM has three groups of functions - recruitment, training and development and retain — have the same importance with a strong relationship and interact others, they all aim to HRM’s objectives.
The core of this model revolves around the company's mission and objectives, which serve as the foundation for Human Resource Management (HRM) goals These HRM objectives are strategically crafted in alignment with the mission, leading to the implementation of specific activities that support these goals.
The HRM system is closely aligned with organizational culture and policies, significantly influenced by macro environmental factors such as political conditions, legal frameworks, economic and social development levels, technological advancements, and environmental conditions.
The human resource model consists of three key functions: attraction, training and development, and retention Each of these functions is supported by specific policies and activities that align with human resource management objectives This model highlights the interconnected nature of these functions, emphasizing their collaborative relationship rather than a hierarchical one.
11 them directly affects to the others and makes a closed cycle, all for human resource objectives.
Figure 2.3a: HRM and environmental factors
Figure 2.3b: The function element factors
Conception of employee COMMItMENE -.- 5 5 + + £+s+svesseese 14 2.2 Medical reDT©S€TIfAfIV€S - - c1 TH TH HH Hy 16 2.3 Hypothesis development and proposed research model ôô- 17
Commitment is established when an individual connects external interests to a consistent course of action, as noted by Becker (1960) Kanter (1968) further defines commitment as the emotional attachment an individual develops towards a group Additionally, Hrebiniak and Alutto describe commitment as a structural phenomenon that arises from these interactions.
In 1972, it was noted that individual-organizational transactions and changes in side bets or investments evolve over time According to Porter et al (1974), commitment reflects the strength of an individual's identification with and involvement in a specific organization Furthermore, Marsh and Mannari emphasize that a committed employee believes it is morally right to remain with the company.
Commitment in the workplace is a complex psychological state that reflects an individual's relationship with their organization According to Salancik (1977), it signifies a condition where an individual is bound by their actions, regardless of the status or satisfaction provided by the firm over time Meyer and Allen (1991) further define commitment as a psychological state that not only characterizes this relationship but also influences the decision to remain a member of the organization or to leave Understanding these definitions is essential for organizations aiming to foster employee loyalty and engagement.
Meyer and “Commitment is a force that binds an individual to a course of action of Herscovitch (2001) relevance to one or more targets” (p 301)
Pool and Pool (2007) “Organizational commitment reflects the extent an individual identifies with an organization and committed to its organizational goals” (p 353)
Organizational commitment refers to an employee's strong desire to remain a part of the organization, aligning with its goals and achievements It encompasses loyalty and a readiness to put in significant effort for the organization's success.
Organizational commitment (OC) has been extensively researched over the decades, highlighting the importance of employee loyalty and engagement in relation to their efforts in supporting corporate objectives Meyer and Allen (1991) define OC as a psychological state that reflects the relationship between employees and their organizations, influencing their decision to remain with the company Employee commitment (EC) encompasses a variety of types, including engagement, attachment, and involvement, across different foci such as work, job, career, and organization The categories of commitment can be classified into behavioral, attitudinal, and motivational aspects, supported by three main research streams: sociological, industrial/organizational psychology, and health psychology (Roodt, 2004a) Mowday, Steers, and Porter (1979) further describe EC through three interrelated factors.
A strong commitment to the firm's objectives and values fosters a deep belief in the organization, encouraging members to put forth their best efforts This dedication not only enhances individual performance but also cultivates a strong desire to maintain long-term membership within the organization.
Commitment reflects a proactive loyalty to an organization, as it involves employees dedicating a part of themselves to enhance the company's well-being This dedication can be observed not only through an individual's expressed beliefs and opinions but also through their actions, highlighting the active connection between employees and the firm (Mowday, Steers & Porter, 1979).
2.1.2.2.1 The Attitudinal and Behavioral Perspectives
Mowday et al (1982) identified two types of commitment within organizations: attitudinal commitment and behavioral commitment Attitudinal commitment refers to how employees perceive their relationship with the organization, particularly in terms of alignment between their personal values and the organization's goals In contrast, behavioral commitment emphasizes the ways employees become entrenched in a company and how they navigate their roles within it.
Meyer & Allen (1991) illustrated the relationship between attitudinal and behavioral commitment through schematic representations, highlighting primary causal relations with solid arrows and secondary relations with broken arrows This indicates that various processes may influence the connection between commitment and behavior In the attitudinal framework, the behavioral outcomes of commitment can affect the factors that lead to either stability or change in that commitment Conversely, within the behavioral framework, actions can shape attitudes, which in turn may affect the probability of those actions being repeated in the future.
Figure 2.5a: The Attitudinal Perspectives on OC
2.1.2.2.2 Meyer & Allen’s (1991) three-component model of commitment
Meyer & Allen (1991) identified three key themes of commitment: affective, continuance, and normative commitment Affective commitment reflects an employee's emotional attachment and identification with the organization, driving them to engage willingly Continuance commitment involves an awareness of the costs associated with leaving, leading individuals to stay because they feel they need to Lastly, normative commitment embodies a sense of duty to remain with the organization, compelling employees to feel obligated to continue their membership Together, these forms of commitment shape the psychological relationship between employees and their organizations, influencing their decisions to stay or leave.
MRs are basically sale persons But different from salesmen who are involved in direct selling, MRs are involved in indirect selling They meet and work
16 with experts who influence end-users Therefore, MRs’ customers are experts.
The International Federation of Pharmaceutical Manufacturers Associations defines a Medical Representative (MR) as a business professional employed by pharmaceutical companies MRs engage with medical personnel to share critical information regarding the quality, effectiveness, and safety of medications, while also gathering and disseminating relevant data (Zhang, 2019).
In Vietnam, the pharmaceutical landscape is heavily influenced by drug imports, leading many pharmacy graduates to pursue careers as medical representatives (MR) Unofficial statistics indicate that approximately 80% of pharmacy graduates aspire to become or actively apply for MR positions, highlighting the career path's popularity among new professionals in the field.
Medical representatives (MRs) can pursue various career paths, including roles as sales supervisors, marketers, key account executives, regulatory affairs staff, or medical information specialists within pharmaceutical distribution companies Additionally, MRs may transition to production companies or become pharmacists in hospitals, pharmacies, or state agencies Many MRs also choose to start their own businesses and engage in the drug distribution network after gaining experience in the field.
MR to earn knowledge and experiences.
2.3 Hypothesis development and proposed research model
A review of both domestic and international studies reveals commonalities in HRM practice models, as identified in the works of Singh (2004), Thang et al (2010), Georgellis (2008), and Anh & Dao (2013) The synthesized factors of HRM are summarized in the table below.
Table 2.2: Factors of HRM practices Factors Singh Thang et al | Georgellis | Anh & Dao
Source: The authors synthesized, 2021 After consulting expert’s opinions, the authors selected 6 following factors to survey: e Attraction and selection e Training e Performance appraisal e Career development e Benefit and compensation e Working environment
The relationship between attraction and selection and OC
Attraction and selection are crucial components of human resource management (HRM) in organizations, as they directly influence the quality of the workforce A strong attraction and selection process leads to a skilled and experienced team, which is essential for corporate growth and sustainability High-quality human resources enhance a company's competitive edge, resulting in improved effectiveness When a business thrives, it ensures employee benefits and compensation, fostering greater job satisfaction and encouraging employees to contribute more to the organization.
Scholars related the relationship between attraction and selection and OC.
Abrokwah et al (2018) examined how recruitment and selection impact employee commitment, revealing that effective hiring processes enhance overall company performance The study highlighted the crucial role of human resources in fostering three types of commitment—affective, normative, and continuous Furthermore, it was found that strategic recruitment and selection not only attract desirable employees but also elevate their commitment levels.
18 affective, normative and continuous commitment, which also brings stronger impact on the operational performance.
A study by De Cooman et al (2009) investigated the relationship between employees' work values and their organization's values, highlighting the importance of person-organization fit The findings revealed that when employees perceive a strong alignment between their values and those of the firm upon entry, they are more likely to remain with the organization for a longer duration.
A study by Chew and Chan (2008) examined the relationship between HR practices, organizational commitment (OC), and employee retention in Australia The findings revealed that a strong person-organization fit during the selection process positively influenced organizational commitment Additionally, the intention to stay with the organization was significantly linked to person-organization fit as well as other HRM factors, including remuneration, recognition, training, and career development.
In Vietnam, the study of Quoc (2018) also improved the positive relationship between attraction and selection and OC.
Based on that theoretical background, the first hypothesis of this study is:
H1: Attraction and selection positively influences OC.
The relationship between training and ÓC - 5+5 ++s<+c+sceeces 19 2.3.3 The relationship between performance appraisal and OC
Training is essential for developing a strong workforce, as it fosters connections between employees and managers while enhancing individual competencies This improvement leads to increased benefits, higher compensation, and greater opportunities for promotions Consequently, organizations can maintain an effective and productive workforce.
Personnel training significantly enhances employee commitment to an organization A study by Newman et al (2014), involving 437 employees from five multinational companies in the Chinese service sector, highlighted that effective training increases employees' affective organizational commitment and helps decrease turnover rates.
Training plays a crucial role in the success of franchise lodging organizations by enhancing employee morale, improving perceptions of supervisor quality, and increasing awareness of company policies Additionally, effective training indirectly fosters greater organizational commitment among staff, contributing to overall business success.
These findings established that persuasive evidence speaks loudly that it is necessary to implement high-quality training programs (Roehl & Swerdlow, 1999).
The study by Bulut & Culha (2010) explores the impact of organizational training dimensions on organizational commitment (OC) through empirical research, yielding four key conclusions Firstly, the motivation for training is linked to OC, as employees' willingness to participate in training programs directly influences their commitment Secondly, perceived access to training opportunities that enhance staff skills and competencies positively affects OC, with better access likely increasing affective commitment Thirdly, employees who expect benefits from their training participation demonstrate greater commitment to their organizations Lastly, support from supervisors and managers for training significantly enhances OC, as employees feel more engaged when they receive backing for their development.
Research indicates that factors such as the availability of training opportunities, the frequency of training sessions, employee enthusiasm for training, perceived benefits of training, and supervisory support for training are directly linked to both the affective and normative aspects of employee commitment.
Empirical research indicates a positive relationship between training opportunities, social support for training, a desire to learn, and perceived benefits of training with organizational commitment (OC) (Kang, 2004; Bartlett, 2001) Bashir and Long (2015) found that training variables, including opportunities for training and managerial support, significantly influence affective and normative commitment, while having a non-significant relationship with continuance commitment Notably, opportunities for training emerged as the strongest predictor of normative commitment Additionally, a literature review by Dias and Silva (2016) highlights a growing interest in the connection between training and OC, establishing a robust theoretical foundation for further empirical investigation.
20 or not, the perception that employees have the opportunities to be trained affects the psychological connection to their company.
Research in Vietnam has highlighted a significant relationship between various factors and the organizational commitment (OC) of lecturers at non-public universities in Ho Chi Minh City A study by Tai (2016) identified that opportunities for training and promotion, as well as benefits and compensation, have a strong influence on lecturers' OC Additionally, Anh and Dao (2013) corroborated these findings, demonstrating a similar connection between training and OC.
Based on that theoretical background, the second hypothesis of this study is: H2: Training positively influences OC.
2.3.3 The relationship between performance appraisal and OC
Performance appraisal is a crucial method for evaluating employee effectiveness, offering valuable insights and regular feedback This process enhances employees' awareness and accountability in their roles When conducted fairly, performance appraisals foster a sense of security among employees, ultimately strengthening their commitment to the organization.
Affective commitment is the emotional attachment employees feel towards their organization, as defined by Meyer and Allen (1991) Performance appraisal practices play a crucial role in influencing both the intention to stay and organizational citizenship behavior, primarily through their impact on affective commitment When employees perceive satisfaction with performance appraisals, it positively affects their attitudes and behaviors Consequently, satisfaction with performance appraisals is likely to enhance affective commitment, intention to remain with the organization, and foster organizational citizenship behavior (Ravikumar & Raya, 2019).
Salleh et al (2013) introduced a model illustrating the connection between performance appraisal and organizational commitment (OC) The model suggests that fair performance evaluations lead to increased employee commitment to the organization Additionally, it posits that satisfaction with performance evaluations mediates the relationship between appraisal fairness and OC.
Vietnamese scholars also conducted studies and showed the positive relationship between performance appraisal and OC Specifically Anh & Dao
(2013) proved that the higher been evaluated performance appraisal, the higher level of OC.
Based on that theoretical background, the third hypothesis of this study is:
H3: Performance appraisal positively influences OC.
The relationship between career development and OC
Enhancing employee commitment can be achieved by organizations that invest in career development programs aimed at improving competencies Research indicates that mentoring and job enrichment significantly boost organizational commitment (Dialoke & Wabara, 2017) The effectiveness of management is reflected in their ability to design and implement impactful career development initiatives Employees desire managers who actively engage in their career growth, making it essential for employers to prioritize career advancement, counseling, and opportunities for their staff (Agba et al., 2010).
A recent study by Simiyu & Mbithi (2019) in Kenya found a statistically significant link between career development and employee commitment Providing employees with training and career advancement opportunities enhances their competencies and job motivation, leading to increased commitment to their work The research emphasizes the importance of empowering employees in decision-making related to their roles, fostering a sense of belonging within the organization and enabling them to set achievable goals, ultimately driving their commitment to success.
Domestic research has demonstrated a significant relationship between career development and organizational commitment (OC) Giang (2016) emphasized the importance of fostering employee belief to enhance motivation and promote opportunities for advancement Additionally, the study by Anh & Dao (2013) supports the notion that career development positively influences OC, highlighting the need for organizations to invest in their employees' growth.
Based on that theoretical background, the fourth hypothesis of this study is:H4: Career development positively influences OC.
The relationship between benefit and compensation and OC
The impact of benefits and compensation on employee commitment is a crucial and debated topic in contemporary human resource management Research consistently shows that there is a strong connection between compensation, job satisfaction, and employee performance, ultimately influencing organizational commitment Therefore, offering competitive compensation is essential for companies aiming to retain their workforce effectively (Rahaman et al., 2016).
Investing in employees significantly enhances their affective commitment to the organization, primarily through effective compensation (Tarus, 2016) A study by Soon Yew (2008) revealed that both mandatory and fringe benefits positively influence organizational commitment, with fringe benefits having a stronger impact This indicates that employees who receive more fringe benefits tend to exhibit greater loyalty and commitment to their organization.
Thuy, L T T's doctoral dissertation (2016) identified key factors influencing the commitment of officials at Tra Vinh University, with recognition and rewards being the most significant Similarly, Giang's research (2016) confirmed that organizational rewards are the primary driver of employee commitment, indicating that increased rewards lead to higher levels of employee engagement.
Based on that theoretical background, the fifth hypothesis of this study is:
H5: Benefit and compensation positively influences OC.
The relationship between working environment and OC
A positive working environment is characterized by several key factors, including robust infrastructure such as modern computers and well-equipped meeting rooms, a strong network of relationships among employees and between staff and management, a supportive corporate culture, high levels of teamwork, and an open and collaborative atmosphere.
The correlation of work environment and OC has been studied and revealed by many scholars It’s been established that the conditions of working environment
A comprehensive program aimed at improving work conditions can significantly enhance employee life satisfaction and commitment (Vanaki & Vagharseyyedin, 2009) Hanaysha (2016) emphasizes the importance of creating a beneficial learning environment to foster organizational commitment (OC), highlighting the need for management to design such spaces effectively Additionally, strong relationships based on respect and knowledge sharing between co-workers and management are crucial for enhancing OC The workplace layout and organizational culture also play vital roles in this process Mayowa & Aina (2016) specifically examined work environment indicators in academic libraries, finding that staff are highly task-oriented and committed to their organization, demonstrating a strong sense of loyalty to their library.
Vietnamese research highlights a strong positive correlation between work environment and organizational commitment (OC) Khuong & Le Vu (2014) examined the OC of drivers in Ho Chi Minh City, revealing that improved working conditions and better relationships with management and coworkers significantly boost OC levels Their findings suggest that transportation companies in Ho Chi Minh City should focus on strengthening the relationships among drivers and between drivers and supervisors to enhance overall OC.
Based on that theoretical background, the sixth hypothesis of this study is:
H6: Working environment positively influences OC.
Based on all above synthesized literature, the authors proposed research model as Figure 2.6.
Figure 2.6: Research model Source: The authors proposed, 2021
RESEARCH DESIGN AND METHODOLOGY
Data analysis metlO( G1 11991119119 HT kh 30
After gathering online responses, we meticulously reviewed them to eliminate any unsatisfactory entries The valid responses were then extracted into an Excel file, coded, and processed using SPSS 20 software, following a structured three-step approach.
Step 1: Scale quality testing This step aims to evaluate the reliability of the scale The reliability is examined by using Cronbach’s alpha test Cronbach’s alpha is a measure used to assess the reliability, or internal consistency, of a set of scale or test items In other words, the reliability of any given measurement refers to the extent to which it is a consistent measure of a concept, and Cronbach’s alpha is one way of measuring the strength of that consistency.
Researchers generally agree that a Cronbach’s alpha value between 0.8 and 1 indicates excellent reliability, while a value between 0.7 and 0.8 is considered acceptable (Trong & Ngoc, 2008) For this study, scales were selected if they achieved a Cronbach’s alpha greater than 0.6, following the recommendations of Trang & Tho (2008) as cited by Dao.
2015) Variables that have Corrected Item - Total correlation under 0.3 were rejected.
Step 2: Pearson correlation analysis Examine the relation between dependent variables and independent variable.
A significance level (sig.) of less than 0.05 indicates a significant relationship between the dependent and independent variables Conversely, a sig greater than 0.05 suggests that Pearson's correlation coefficient (r) is not statistically significant and should be rejected A positive correlation is indicated by an r value greater than 0, while an r value less than 0 signifies a negative correlation.
Estimate and access the strength of relationships between a dependent variable and one or more independent variables Using some indexes of Model
Summary table (adjusted R’), ANOVA table (sig of F test), Coefficients table
RESEARCH RESULTS OF THE IMPACT OF HRM PRACTICES
Overview of pharmaceutical market in Vietnam - + ô+++ 32
In 2018, the Vietnam pharmaceutical industry reached a value of 92.4 trillion VND, reflecting an 8% growth compared to 2017 Imported medicines dominated the market, holding a 64% market share, while in the hospital distribution channel, they accounted for 71.5% of the volume, leaving local medicines with a 28.5% share (SSI research).
Tổng quan thị trường trong năm 2018
` > © > & © oe es oe se m% market share (LHS) % YoY
Figure 4.1: Vietnam pharmaceutical market overview in 2018
Source: SSI research Branded medicines accounted for 50% total tender value in 2019 (SSI research).
Branded Gen - Cat - Cat Gen - Gen - Cat Gen - Cat Trad- Cat Trad- Cat. drugs 1 4 5 1 2
Figure 4.2: Total tender value in 2019 (up to Nov 22)
Overview of Bayer Vietnam LLt( - - c1 11+ ESkEsseeeeersseree 33 4.1.4 Summary of HRM practices with MRs at Bayer Vietnam Lid
Bayer Vietnam Ltd., a subsidiary of the Bayer Group, has been active in Vietnam since 1994, operating two state-of-the-art factories located in Dong Nai and Binh Duong provinces The company also maintains branch offices in Hanoi and Ho Chi Minh City to enhance its business operations.
Bayer's Pharmaceuticals Division specializes in prescription medications, with a strong emphasis on cardiology and women's healthcare It also offers contrast agents for diagnostic imaging and focuses on specialty therapeutics in oncology, hematology, and ophthalmology.
The Consumer Health Division specializes in marketing non-prescription, over-the-counter (OTC) products designed to empower individuals to take greater control of their health and well-being.
Crop Science Division in Vietnam offers fungicides, herbicides & insecticides for crop protection along with hybrid rice, vegetable-seed solutions and non-crop pesticides.
The study examines the Pharmaceuticals Division, highlighting that Bayer Healthcare's sales reached 1,540 billion VND from Q4 2019 to Q3 2020, reflecting a 7% growth according to IQVIA data This impressive performance has secured Bayer's position among the top 10 largest pharmaceutical companies in Vietnam.
33 bes IQVIA MAT Q3 2020: Bayer remains at No 10.
Lủ 1 ABBOTT EPD L te; 11% 08% as
SOUHCE VA Totet Aoffleg klgyket 2020 Q3
Figure 4.3: Performance of top 20 pharmaceutical companies in Vietnam
Source: IQVIA The human resource structure of Bayer is shown in the below Figure 4.4 In Pharmaceutical division, Bayer is constituted by main functional departments
(Consumer Excellent, Regulatory Affair, Legal, HR, Medical and Market Access) and 4 Business Units (General Medicine, Women Healthcare, Special Medicine and
Radiology) Business Units are then divided according to geographical regions and potential.
| Crop Science ) | Pharma | ( Consumer Health )
Market Access General Medicine Women Healthcare Special Medicine Radiology Director Business Unit Business Unit Business Unit Business Unit
Pharmacy-North FF Manager Medical
*(n): Number of MR in the team, total: 162 FF Manager (10)
Figure 4.4: Human resource structure of Bayer
Source: The author synthesized 4.1.4 Summary of HRM practices with MRs at Bayer Vietnam Ltd.
Bayer utilizes two main types of interviews in its hiring process Initially, when a vacancy arises, the HR department announces the opening internally to encourage employee referrals, in line with the company's internal promotion policy Only if there are no suitable internal candidates will the company seek external applicants This approach not only fosters employee engagement but also enhances the recruitment process by leveraging existing talent within the organization.
Bayer offers a reward of 5 million VND to employees who refer candidates that successfully pass the interview and probation period, excluding line managers Additionally, Bayer runs a Campus Campaign aimed at recent pharmacy graduates To attract potential candidates, the company conducts orientation meetings at the two largest pharmacy universities in Hanoi and Ho Chi Minh City, where they collect application forms Following this, a unique interview process consisting of 3-4 rounds is organized, allowing Bayer to effectively evaluate hundreds of applicants and select the best fit for their needs.
The Consumer Excellence department organizes training programs for Medical Representatives (MRs), starting with a one-week introductory course for newcomers This training covers company orientation, essential soft skills like selling and communication, as well as company policies and product knowledge Additionally, ongoing training sessions are held for all MRs, focusing on policy updates and advanced soft skills, including presentation and negotiation techniques.
Quarterly appraisals are conducted for each Medical Representative (MR), who is assigned a specific territory that may include hospitals or pharmacies, depending on whether they operate in the ETC or OTC channel These territories are evaluated to establish quarterly sales targets, which are determined by analyzing historical sales data and assessing potential market opportunities.
At the end of each quarter, MRs are assessed based on the percentage of their sales target achieved, with sales performance accounting for 80% of their compensation Additionally, each MR has a non-sales KPI (key performance indicator) established at the start of the quarter, which contributes the remaining 20% to their overall compensation.
The Company conducts an annual appraisal using the Performance Management Process (PMP), which consists of qualitative and quantitative evaluations The qualitative aspect, known as "LIFE," assesses Leadership, Integrity, Flexibility, and Effectiveness, while the quantitative evaluation focuses on measurable indicators such as total sales performance, product test scores, sales forecast accuracy, and territory management scores PMP scores range from 1 to 4, and employee salaries are adjusted annually based on these evaluations.
The HR department has developed a specialized program called the Career Passport Center (CPC) exclusively for MRs Participants undergo four rounds of online tests, teamwork exercises, and individual interviews Those who successfully complete the first two rounds will continue in the campaign and be categorized into four classes: Titan, Silver, Golden, and Premium, each offering distinct benefits Successful MRs receive a career passport to validate their achievements at Bayer, with the highest class gaining access to upcoming projects.
At 36 years old, individuals have opportunities for promotion, with golden and premium members benefiting from specialized English and advanced soft skills training instead of conventional courses The CPC program is conducted annually to identify and develop potential talent, and internal candidates are always prioritized for any upper-level vacancies.
The HR department conducts annual research to establish competitive salary ranges for each position, ensuring alignment with market standards Each year, salaries are reviewed and may increase based on individual performance and opportunities for promotion.
Compensation policies are designed to assess the performance of Medical Representatives (MRs) and motivate them to excel An annual incentive scheme rewards MRs who achieve quarterly sales targets, with compensation tied directly to their sales performance Additionally, top-performing MRs at the year's end receive special awards, including cash bonuses and travel trips, recognizing their exceptional contributions.
Employees receive various allowances, including subsidized lunches for working days, monthly telephone and gasoline fees, and coverage for travel and hotel expenses during business trips Additional support is provided for significant life events such as childbirth and marriage Other allowances include those for the Tet holiday, birthdays, and International Women's Day.
- Physical working environment: MR can use meeting room in Bayer offices in Ha Noi and Ho Chi Minh City The offices are decorated according to company’s strategies.
Results of the EC of MRs at Bayer Vietnam Ltd oo cece 37 1 General anaẽyS1S sgk 37 1.1 Characteristics of respOI€TIES - ô+ + 1x nh ri, 37 2 Analyze the reliability of the model - Cronbach’s alpha analysis
To survey adequately the required sample (minimum 140), the questionnaires were sent to all MRs working at Bayer at research time (total 162
A total of 159 respondents participated in the study, but 10 were excluded due to incomplete responses to the questionnaire, resulting in a final sample size of 147 The characteristics of the respondents are detailed in Table 4.1.
Respondents characteristic (n7) Quantity Percentage Gender Male 51 34.69%
Medical representative 5 - 10 years 72 48.98% experience More than 10 years 22 14.97%
Time working in the company > 10 years ằ 854
In a study involving 147 respondents from a pharmacy university, the gender distribution revealed that 51 participants were male, accounting for 34.69% of the total, while 96 were female, representing 65.31% This data highlights the gender ratio among pharmacy university students.
The survey results indicate that among the respondents, 59 are younger than 30, 82 are between 30 and 45, and only 6 are older than 45 This translates to age group percentages of 40.14% for those under 30, 55.78% for those aged 30 to 45, and just 4.08% for individuals over 45 These findings suggest a trend where older individuals are less likely to pursue careers as market researchers (MR).
Bayer has a high entry requirement, as evidenced by the fact that over half (52.38%) of its employees hold a bachelor's degree, contributing to a total of 147 qualified individuals within the organization.
Medical representative experience: Most of the respondents have worked as a MR less than 10 years (85.03%) This improves that they are quite young in their job.
Time working in the company: Only 11 suitable respondents have work at Bayer more than 10 years This points the hopping trend of MRs in pharmaceutical industry.
Table 4.2: Descriptive statistics a ee ee He Std Deviation
147 2.00 5.00 3.8027 74613 AS2 147 2.00 5.00 3.8844 78963 AS3 147 1.00 5.00 3.6122 86364 TR1 147 2.00 5.00 4.0816 74494 TR2 147 2.00 5.00 4.1156 10727 TR3 147 2.00 5.00 3.7687 85262 PA1 147 2.00 5.00 3.7619 80523 PA2 147 2.00 5.00 3.8844 66741 PA3 147 2.00 5.00 3.8435 67945 CD1 147 2.00 5.00 3.7075 79563 CD2 147 1.00 5.00 3.3605 86757 CD3 147 1.00 5.00 3.3129 82597 BC1 147 2.00 5.00 3.7007 65600 BC2 147 2.00 5.00 3.6939 9046 BC3 147 2.00 5.00 4.2585 68335 WE1 147 2.00 5.00 3.7687 75005 WE2 147 1.00 5.00 3.1973 94100 WE3 147 2.00 5.00 3.9728 67180 AGE 147 1.00 5.00 3.4898 83064 GEN 147 1.00 5.00 4.1293 13347 QUA 147 1.00 5.00 3.9116 15784
OC1 147 1.00 3.00 1.6395 56065 OC2 147 1.00 2.00 1.6531 47762 OC3 147 1.00 3.00 1.6871 80071 OC4 147 1.00 3.00 1.7891 68478 OC5 147 1.00 3.00 1.4082 62762
The data indicates that the mean values of the variables are closely aligned with the average, suggesting that Bayer’s medical representatives (MRs) hold neutral views on six key factors of human resource management (HRM) Additionally, the small standard deviations relative to the means confirm that the respondents' opinions are similar, reflecting minimal variation in their responses.
4.2.2 Analyze the reliability of the model - Cronbach’s alpha analysis
4.2.2.1 Analyze Cronbach’s alpha of factors influencing OC of MRs working at
The Attraction and Selection scale, comprising three observed variables (AS1, AS2, AS3), demonstrates a Cronbach’s alpha of 0.619, indicating acceptable internal consistency (Table 4.3a) Additionally, the Corrected Item-Total Correlations for all variables exceed the acceptable threshold of 0.3 (Table 4.3b), confirming their eligibility These findings suggest a consistent perspective on recruitment activities within the company.
Table 4.3a: Reliability Statistics of attraction and selection scale
Table 4.3b: Item-Total Statistics of attraction and selection’s variables
Scale Mean if Variance if ltam-Tatal Alpha if Item
Item Deleted Item Deleted Correlation Deleted
The training scale, comprising three observed variables (TRI, TR2, TR3), demonstrates a Cronbach’s alpha of 0.653, indicating acceptable internal consistency (Table 4.4a) Additionally, the Corrected Item-Total Correlations for all variables exceed the acceptable threshold of 0.3 (Table 4.4b) Consequently, these findings confirm the scale's eligibility and the qualification of the three variables, reflecting that management representatives (MRs) are generally satisfied with the company's training courses.
Table 4.4a: Reliability Statistics of training scale
Table 4.4b: Item-Total Statistics of training’s variables
Scale Mean if Variance if ltam-Tatal Alpha if Item
Item Deleted Item Deleted Correlation Deleted
The correlations presented in Table 4.5b are all acceptable, exceeding the threshold of 0.3, indicating that the scale is valid and the three variables are qualified This suggests that MRs consistently perceive the performance appraisal system as clear and fair.
Table 4.5a: Reliability Statistics of performance appraisal scale
Table 4.5b: Item-Total Statistics of performance appraisal’s variables
The career development scale, consisting of three observed variables (CD1, CD2, CD3), demonstrates a strong reliability with a Cronbach’s alpha of 0.854, as shown in Table 4.6a Additionally, the Corrected Item-Total Correlations presented in Table 4.6b are all above the acceptable threshold of 0.3 These findings confirm the scale's validity and indicate that the three variables are qualified, reflecting a consistent perspective among MRs regarding Bayer's career development program.
Table 4.6a: Reliability Statistics of career development scale
Table 4.6b: Item-Total Statistics of career development’s variables
The benefit and compensation scale, comprising three observed variables (BC1, BC2, BC3), exhibits a Cronbach’s alpha of 0.518, indicating low reliability While the Corrected Item-Total Correlations for BC1 and BC2 exceed 0.3, BC3 falls short with a correlation of 0.279 Additionally, the Cronbach’s alpha if Item Deleted for BC3 is 0.498, confirming its inadequacy Consequently, the benefit and compensation scale is deemed unreliable, potentially due to the unqualified observed variables or varying perspectives on BC policies among management representatives.
Table 4.7a: Reliability Statistics of benefit and compensation scale
Table 4.7b: Item-Total Statistics of benefit and compensation’s variables
Working environment scale with 3 observed variables (WE1, WE2, WE3) has Cronbach’s alpha 0.568 (Table 4.8a), and the Corrected Item — Total
The correlations between WEI and WE exceed 0.3; however, the Corrected Item-Total Correlation for WE2 is deemed unacceptable at 0.279 With a Cronbach’s alpha of 0.725 when WE2 is excluded, it is removed from the model Consequently, the remaining observed variables, WE1 and WE3, yield a Cronbach’s alpha of 0.725, with their Corrected Item-Total Correlations both measuring 0.572, indicating they meet the necessary qualifications.
Table 4.8a: Reliability Statistics of working environment scale
Table 4.8b: Item-Total Statistics of working environment’s variables
Table 4.9a: Reliability Statistics of working environment scale after adjustment
Table 4.9b: Item-Total Statistics of working environment’s variables after adjustment
Scale Mean if Variance if ltam-Tatal Alpha if Item
Item Deleted Item Deleted Correlation Deleted
Organizational commitment scale with 5 observed variables (OC1, OC2, OC3, OC4, OCS) has Cronbach’s alpha 0.819 (Table 4.10a), and the Corrected Item
— Total Correlations (Table 4.10b) are all acceptable (>0.3) Therefore the scale is eligible and these 5 variables are qualified.
Table 4.10a: Reliability Statistics of OC scale
Table 4.10b: Item-Total Statistics of OC’s variables
Scale Corrected Cronbach's Scale Mean if Variance if ltem-Total Alpha if Item Item Deleted Item Deleted Correlation Deleted ồC1
After evaluating the model's reliability and excluding the BC scale and WE2, the remaining five variables along with organizational commitment (OC) were analyzed using Pearson correlation The values for each factor represent the average of the observed variables.
Pearson correlation analysis is used to examine the correlation of all variables, including both the relationship between independent variables and dependent variable and the relationship between independent variables.
Table 4.11 reveals that all five independent variables are significantly correlated with the dependent variable, organizational commitment, as indicated by a significance level of less than 0.05 Furthermore, the positive Pearson correlation coefficients suggest that these independent variables have a favorable impact on organizational commitment.
4.2.4.1 The first regression analysis results
In this analysis, five independent variables and one dependent variable were examined using multivariate regression The results indicated an adjusted R-squared value of 0.354, suggesting that approximately 35.4% of the variability in the dependent variable can be explained by the model.
46 explain 35.4% In another words, 5 independent variables (attraction and selection, training, performance appraisal, career development and working environment) can explain 35.4% MRs’ organizational commitment.
Table 4.12: Model summary - The first analysis
Pt ae] re] |e || a Predictors: (Constant), WE, TR, CD, AS, PA b Dependent Variable: OC
F-test has the sig < 0.05 in the ANOVA table (Table 4.13) It means multivariate linear regression model has been fitted to data set.
Table 4.13: ANOVA table — The first analysis
Residual 141 246 Total 55 146 a Dependent Variable: OC b Predictors: (Constant), WE, TR, CD, AS, PA
The results at Table 4.13 show that all the VIF < 2, the multicollinearity doesn’t exit The sig of AS (0.520) and TR (0.390) > 0.05 Therefore the H1 and
H2 hypothesis are rejected The rest variables (PA, CD, WE) have sig value < 0.05, the H3, H4, H6 are accepted.
Table 4.14: Coefficient table — The first analysis
Unstandardized Coefficients Coefficients Collinearity Statistics
AS TR PA cD WE
4.2.4.2 The second regression analysis results
After rejecting 2 variables (AS and TR), the others are input to analysis The results are shown at Table 4.15, 4.16 and 4.17 In the Model Summary table,
The Adjusted R Square value is 0.356, indicating that the independent variables of performance appraisal, career development, and working environment account for 35.6% of medical representatives' commitment to their company With a significance level of the F-test below 0.05, it confirms that the model is well-fitted to the dataset Additionally, the significance of the coefficients for all three variables is also below 0.05, leading to the acceptance of hypotheses H3, H4, and H6.
Beta of WE is biggest It shows that working environment has the biggest impact to organizational commitment.
Table 4.15: Model Summary — The second analysis a Predictors: (Constant), WE, CD, PA
Table 4.16: ANOVA table - The second analysis
Sum of aa Squares Mean Square
Tatal a Dependent Variable: OC b Predictors: (Constant, WE, CD, PA
Table 4.17: Coefficients table - The second analysis
Unstandardized Coefficients Coefficients Collinearity Statistics
Model |8 St Error Beta Sig.
CONCLUSION AND SUGGESTIONS cài 53 5.1 COPCẽUSIOTN 7G G1 HH nh 53 5.2 Suggestions of applying the research r€SuẽfS - - + se x++x+sxseesserse 54 5.2.1 Performance appraisal c:cccscccssccessceseeceeeceseceeeceseceseeseeceseceeeeneeeeaeens 54
The research model aims to explore the relationship between human resource management practices and the organizational commitment of medical representatives at Bayer Vietnam Ltd Grounded in a comprehensive literature review, the model identifies six independent variables—attraction and selection, training, performance appraisal, career development, benefits and compensation, and working environment—along with a dependent variable, organizational commitment, which is measured through five observed variables Demographic information is also included in the study.
A questionnaire was developed based on a proposed research model, incorporating feedback from experts To ensure an adequate sample size, the questionnaire was distributed to all medical representatives at Bayer during the research period Ultimately, 162 questionnaires were distributed, yielding 157 completed responses.
147 of them are qualified Data was then analyzed by SPSS.
Following the reliability assessment with Cronbach's alpha, the independent variable of benefits and compensation was deemed unreliable and subsequently rejected, while the observed variable WE1 was excluded due to its minimal contribution to the overall model.
Pearson correlation analysis revealed that all five independent variables—attraction and selection, training, performance appraisal, career development, and working environment—significantly relate to the dependent variable Furthermore, each of these independent variables positively impacts organizational commitment.
A two-time regression analysis revealed that three independent variables—performance appraisal, career development, and working environment—significantly influence medical representatives' commitment to their company, accounting for 35.6% of this commitment The hypotheses H3, H4, and H6 were accepted, indicating that the working environment has the most substantial effect on organizational commitment, followed by career development and performance appraisal.
5.2 Suggestions of applying the research results
Research indicates that three key factors—performance appraisal, career development, and working environment—significantly affect medical representatives' commitment to their firm, with the working environment having the most substantial impact To enhance organizational commitment and mitigate brain drain, Bayer should prioritize these elements.
The performance appraisal process can greatly benefit both employees and management by fostering trust and commitment within the organization A fair appraisal system enhances employees' belief in the company, motivating them to perform at their best, which is particularly crucial for sales teams who rely on performance-based compensation To achieve this, companies should establish equitable performance appraisal policies and procedures, including a Standard Operating Procedure (SOP) that outlines key steps for performance evaluation.
- Draft required competencies and job expectations for each employee.
- Conduct individual appraisals on employee performance.
- Schedule a one on one interview between the manager and employee to discuss the review.
- Discuss future goals between employee and manager.
- Archive a signed-off version of the performance review.
A significant majority of medical representatives (MRs) at Bayer are young, with 95.92% under the age of 45, and view their role as a stepping stone in their career development This focus on growth highlights the potential for talented individuals to evolve from their experiences as MRs, allowing the company to tap into a valuable resource for future leadership while simultaneously mitigating brain drain within the workforce.
To boost employee commitment, Bayer should establish a clear job structure for Medical Representatives (MRs), outlining potential career paths, benefits, compensation, and promotion requirements Additionally, the company needs to implement projects that motivate and engage MRs, fostering a culture of high performance and building a strong future workforce.
At Bayer, a vertical structure fosters collaboration among departments focused on a product, necessitating teamwork among medical representatives (MRs) and other employees However, the division of quarterly sales targets by first-line managers into smaller goals for each MR inadvertently encourages competition within the same team This competitive atmosphere underscores the importance of a supportive working environment, where a culture of collaboration and teamwork is essential for success.
A key characteristic of medical representative (MR) jobs is the necessity for travel, as they do not work in an office like other staff members Instead, MRs frequently travel within their city or to other locations using various modes of transportation, including cars, buses, airplanes, and motorbikes To facilitate this travel, companies must implement supportive policies that cater to the needs of their traveling representatives.
5.3 Limitation and suggestions for future research
This research has some following limitations:
The study focuses exclusively on the medical representatives (MRs) of Bayer Vietnam Ltd., limiting the applicability of the findings to this specific company Consequently, the potential for generalizing these results to MRs in other pharmaceutical firms is low The authors recommend expanding the research to explore the factors influencing the commitment of MRs employed by various pharmaceutical companies.
Due to the limited research scope, the sample size was only adequate, resulting in low representation Additionally, the convenience sampling method used may affect the findings To improve reliability in future studies, researchers should consider increasing the sample size and employing a more robust sampling method.
The data analysis conducted was fundamental and requires a more in-depth investigation utilizing advanced tools in SPSS or other statistical software to enhance the quality and significance of the results.
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Nghiên cứu của Đào, P T A (2015) tập trung vào các yếu tố ảnh hưởng đến dự định chuyển việc của trình dược viên làm việc tại các tập đoàn dược phẩm đa quốc gia ở Thành phố Hồ Chí Minh Luận văn này được thực hiện tại Trường Đại học Mở Thành phố Hồ Chí Minh, cung cấp cái nhìn sâu sắc về động lực và lý do khiến trình dược viên xem xét việc thay đổi công việc trong ngành dược.