Luận văn factors affecting employee performance a study on joint venture companies in vietnam

ay h Lunghwa University of Science and Technology Master’s Degree Factors affecting employee Performance: a study on joint venture companies in Vietnam Supervisor 1 : Professor Kenne

ay h Lunghwa University of Science and Technology

Master’s Degree

Factors affecting employee Performance:

a study on joint venture companies in

Vietnam

Supervisor 1 : Professor Kenneth Wang

Supervisor 2 : Dr Dao Van Tien

November 2017

Lunghwa LUnivcrsity of Scicncc and Tcchnology Approval Certificate of Master's Degree Examination Board

‘This is to certify that the Master’s Degree Examinations Board has approved the thesis Factors affecting cmployce performance: a study on joint venture companies in Vietnam published by Mr Nguyen Van Dzung in the Master Program of Graduate

School of Department of Business Administration

Master’s Degree Uxamination Board

Board Members : Assoc Prof, PhD Nguyen Van Dinh

Dr Nguyen Thi [long IJanh

Advisors : Professor Kenneth Wang

Dr Dao Van Tien

Chair Kai — Tang Fan

Date: 2018/01/20

ABSTRACT

Thesis Title: Factors affecting employee performance: a study on joint venture

University : Limghwa Universily af Science and Teelmology

Graduate School : Department of Business Administration

Graduate Student : Nguyen Van Dzung

Advisor t: Professor Kenneth Wang,

Advisor 2: Dr Dao Van Tien

Keywords Finployce performance, factor, joi venture company, Vietnam,

leadership, organizational culture, working envitonment, training, motivation

Value of research:

This research project aimed at giving a new direction in texms of quality analysis of human resources, evaluating the staff working results with quantitative research methods and modeling of rescarch factors, TL rnay help the company’s icadership and set up the stralegie thal focusmg on (he persormel helpfad to stabilixe and improve the staff's results and the quality of kmman resources for Vietnam joint venture companies in particular and others in general

Research scope:

‘The research was conducted at joint venture companies in Manoi, Vietnam which operate in varicly fisids (cg, architectural design, construction indusiry, engineering, manufacturing, the building trade, etc)

Specific objectives of the rescarch include:

sulls of the staff working al the joint

venture companies in Vietnam by establishing regression model between the

1, Identify a number of factors affecting

determinants such as leadership organizational culture, working environment,

training and motivation and their work performance.

2 Based on the results of quanfitative research, propose solutions to help corporate governance catmmitice making personnel policy in order to imprave working resulls

of employees, improve the quality of human resources in Vietnam joint venture

companies.

Acknowledgements

Firstly, I would like to express my sincere gratitude to my advisor Prof, Kemeth

‘Wang for the continous support of my Master study and related research, for his patience, motivation, and immense knowledge This guidance helped me in all the time

of research and writing of this thesis, I could not have imagined having a better advisor

and mentor for my Master study

Besides my advisor, 1 would like to thank the rest of my thesis committee: Dr Dae Van Tien, for his insightful comments and encouragement, but also for the hard question which incented me to widen my research ftom various perspectives

Last but not the least, | would like to thank my family, ary parents and to my brothers and sister for supporting me spizitually throughout writing this thesis and my life in

TABLE OF CONTEN

CHAPTER L INTRODUCTION

1.1 Background of the study

1.1.1 Joint Venture Companies in Vietnam

1.2, Motivation

1.3 Objective of the study

1.4 Value of the study

1.5 Summary

CHAPTER 2: LITERATURE REVIEW AND HYPOTHESIS DEVELOPMENT.8

2.1 Theoretical backgraund

2.1.1 Employee Performance

2.1.2 Factors Affecting Employee Performance

2.1.3, Conceptual Framework Development

2.1.4, Megregor Theory X and Theory ¥

2.1.5, lerzherg, Mausner and Snyderman's two factor theary

2.2 Hypothesis development

2.2.1, The effect of leadership on employee performance

2.2.2, The effect of organization culture on employee performance

2.2.3, The effect of working environment on employee performance

2.2.4, The eilect of training on employee performance

2.2.5, The effect of motivation on employee performance

3.4 Cholce of measures

3.5 Sample techniques

3.6 Data collection methods

3.7 Data quality contral

3.8 Data analysis method

3.9, Sununary

CHAPTER 4 DATA ANALYSIS AND RESULTS

4.1 Pilot testing

4.2, Descriptive statistics

4.3 Assessment and Refinement of measurement scales

4.3.1 Refinement of measurement scale

4.3.2 Exploratory Factor Analysis (EFA)

4.3.3, Exploratory factor analysis, Independent variables

4.3.4, Exploratory factor analysis, dependent varlables

5.3 Managerial implications and Recommendations

5.4, Limitations and Future research

REFERENCES

FULL NAMES OF ACRONYMS

The following acronyms have been used in this thesis:

JV: Joint Venture

JVs: Joint Ventures

IVC: Joint Venture Company

IVCs: Joint Venture Companies

HRM: Human Resource Management

LIST OF TABLES

‘Table 1: Top 10 countries invest in Vietnam in 2016

Table 2: For of investment of FDT up to 2066

‘Table 4: Demographic description

Table S: Mean value

Table 6: Reliability test result

Table 8: Total Variance Explained

Table 9; Rotatcđ Component Mahix co ăno

‘Table 10: KMO and Bartlett’s Test for dependenl variable

Table 11; Component mairix of dependent variable

Table 12; Regression analysis restlfs

LIST OF FIGURES

Figure 1: Characteristics of JVCs in Vicunam

Eigtưe 3: Research model co son

1d

wilt

CHAPTER 1: INTRODUCTION

‘The purpose of this chaplcr gives a briaf background to the subject of the study, which will give the reader a comprehensive overview of study His continue by presenting the backeround of the study This is will followed by providing the statement of research problem, research question and highlight the exactly goals for this research,

1.1 Background of the study

1.1.1 Joint Venture Companies in Vietnam

“A joint venture company (IVC herealler) is a separate legal organizational entity representing, the partial holdings of two or more parent firms, in which the headquarters of at least one is located outside the country of operation of the joint venture ‘his entity is subject

to the joinl control of ts paranl firms, cach of which cconomically and legally indapondent of the other” (Newbury & Zeira, 1997, p 89), Elango and Sambharya (2004, p, 110) additionally define joint ventures (JV hereatter) as” a partnership wherein the venture (business) is jointly awned by two or more firms”, Shared ownership such as JVC gives the possibility lo share nal only risk but also strengths, especially local market knowledge of aimed market partner (Al-

Kaabi et al 2010) Further, Kirby and Kaiser (2001) also share this assertion “joint venture can

be scon primarily as a deviee lo gain accuss lo resources embadited in other organizations and,

| | and as a mean of acquiring local management expertise and connections to ficilitate fast entry into new makes” This entry mode allows more flexibility in the sourcing and deployment of resources This, on the other hand, facilitates the overcoming of industry barriers and minimization of risks of Liabilities of foreignness (Elango & Sambharya, 2004) Moreover, JVC can also have a local partner that “can help firms gain legitimacy because partnering with a locat fir can help il croste structures and activities thal conform to lacal noms, values and expectations” (Brouthers et al 2008, p 193)

In Vietnam, joint venture companies (VCs hereafter) is established in the form of a

liniled liability company or join! stock company, cach party of the joint venture cormpanics shall be responsible depend on the amount of capital committed to contribute to the legal

capital of the enterprise A JVC will have the legal representative status in accordance with the law of Vietnam, which establish and operate from the date of investment license

Figure 1: Characteristics of VCs in Vietnam (Voer, 2016) There are four main types of JVCs in Vietnam: Vietnamese party and a Foreign party;

Vietnamese party and Foreign parties, Vietnamese parties and a Foreign party, and

‘Vietnamese parties and Foreign parties

Operational status of JVCs in Vietnam:

The number of projects granted licenses in the year to December 2016 was 2,556 with

$15.1 billion in total register capital Among 95 countries and territories investing in Viet Nam

in 2016, the Republic of Korea led in the term of capital with $7 billion (28.8 per cent of the

total) Japan came second with $2.58 billion (10.62 per cent), and Singapore was third with

$2.41 billion (9.9 per cent)

Table 1: Top 10 countries invest in Vietnam in 2016

Sources: The report of the Planning and Investuent portal (2016)

IVC is one of the most tlyce popular foreign companies in Vielnam As showed in Table 2, up to the end of 2016 JVC holds the second position of foreign invest companies in Vietnam It invests in 3.863 projects as more than USD 71 billion registered capital and accounts for 18 percent of total project, 25 percent of total registered capital The first position

is belong to 100% Foreign-Invested Companies with 17.629 projects as more than USD 189 Lillion registered capital 80 percent of tolal project, 67 percent of total registered capital The third position is Business Co-operation Contract form with 305 projects as more than USD 6 billion registered capital or 1.4 percent of total project, 2.2 percent of total registered

Table 2: Form of investment of PDI up to 2016

Order Form of investment Total project [Fotal registered capital

Lngineering ); manufacturing (ex: Honda Vietnam, Canon Vietnam Co., ltd), the building

trade (ex: Urban infraslructize development investment corporation), logistic (cx Glory logistic joint venture co., Itd, Transworld QBV ICD ); alcoholic beverage industry (ex: Teineken Vietnam), ete and has a great contribution to Viemam’s economy Far examples

3

Honia Vietnam:

Established in 1996, Honda Vietnam is a joint venture between Honda Motor Co (Japan) Co., Asian Honda Motor (Thailand) and the Corporation movers and machines Agriculture Vietnam with 2 branches main products: motorcycles and cars After nearly 20 years in Vietnam, Honda Vietnam has constantly developed and become one of the leading companies in the field of producing molorcycle and automobile manufacturing reputation im the Vietnam market, Since receiving the investment license on the date 03/22/1996, Honda Vietnam has so far invested about $ 530 million building three factories and one motorcycle assembly factory assembling Including three motorcycle factories has a total investment of up

to $470 million wilh a capacity of 2.5 million units / year, a car factory will.a total invesiment

of USD 60 million with a capacity of 10,000 units / year Created nearly 10,000 jobs and contribute to the budget aver 40,000 billion VND through taxes (Honda, 2016)

Heineken Vietnam:

Heineken Vietnam Brewery Limited Company (Heineken Vietnam Brewery) was cslablished on Decomiber 9th, 1991 by Saigon Trading Group (SATRA) and Asia Pacilie Breweries Ltd (APBL) now Heineken Asia Pacific Pte, Ltd (HEINEKEN Asia Pacific)

The brewery covering an area of 12.7 hectares in Thoi An Ward, Distriet 12, HCMC is ane of the most inode breweries in Southeast Asia For a number of years, Teineken Vietnam Brewery has been one of the top corporate tax payers in the city and is recognized as one of the most effective businesses in Ho Chi Minh City In 2016, Heineken Vietnam has contributed 33,500 billion for Victnam's cconomy, equivalent 10 0.75% of Lolal national GDP(sources: hitp.//heineken-vietnam.comvn), Heineken Vietam Brewery has also contributed significantly to creating employment opportunities, hiring around 1,600 locals and creating thousands of jobs for supplicrs and partners in Vietnam

Apatt fiom the imovative brewery in District 12, Heineken also has three big projects such as: Heineken Vietnam Brewery Danang, Heineken Vietnam Brewery Quang Nam, Heineken Vietrarn Browery Tien Giang

Big C Vietnam:

Tn 1998, aller trany years in the field of food, refined sugar, marine services Bourbon established Vindémia Company and oponed the first supermarket in Viotraan with the French style Cora brand In Dong Nai The company also has a stake in the Casino Group

‘The investment cost of Cora Dong Nai was about $ 54 million, of which 65% was from Bourbon and the remaining 35% fiom Donimex, a state-owned import-cxport company in Dong Nai province In April 2016, Big C Vietnam joined Central Group Thailand, one of the leading retailers in the South Asia region Afler nearly 20 years of development in Viena Big C created over 8,477 jobs with the system of 35 Big C Supercenter and 31 shopping mall across Vietnam Only in 2016 Big C has contributed to the state budget nearly 2,000 billion VND

1.2 Motivation

Employee performance is a topic that has received very significant attention by managers and researchers alike (Gautam, Mandal & Dalal, 2006) It is acknowledged with certainty that no organization may possibly thrive without their employees

Employees are the main reason any organization might have the potential to keep in

existence for a long time Like JVCs in Vietnam, employees are the ones who play the

major roles and make significant contributions to the organization High employee

performance would influence the efficiency of the organization and could lead to achieving the organization's vision and goals (Hussin, 2011) A review of the related

literature indicates that to date, previous studies on employee performance has

mentioned the factor that affects employee performance such as leadership, organization culture, working environment, training and motivation and how that conthibuted to it

being attained, But not much research on its impact towards’ performance was

conducted (Dinler, 2008) Besides, most of these existing studies on employee

performance have been carried out over the years but they are largely based on the western organizations such as US, UK (e.g., Grand, Fried & Juillerat, 2010) and very few studies have been researched in Asia organizations/companies This brings about a

great gap that needs to be filled! with tremendous research because employees in

different environments and who are affiliated to differerit cultures cannot attain the high

efficiency employee performance fiom the same factors) Accordingly, there is an

emerging call for exploring the phenomenon under discussion in Asia

otganizations/companies, such as in Vietnam

1.3 Objective of the study

In view of the extant literature gap, the general objective of this study is to empirically assess a conceptual framework on the factors affecting employee

performance in JVCs in Vietnam Specially, this study firstly examines how leadership

factor to have an impact on performance of employees in Vietnam JVCs Secondly, this

research also assesses the role of organization cultural factor in enhancing employee

performance in Vietnam JVCs Thirdly, this study tries to find out whether working

environment factor has an impact on employee performance in these companies

Finally, this study purposely identifies how training and motivation factors to improve

employee performance in Vietnam JVCs

1.4 Value of the study

This study makes essential contributes to scholars and practitioners in several

ways In view of scholars, this study shall benefit both the public and academia through

understanding the factors that influence employee performance in the JVCs For the

academia, the study may advance knowledge in employee performance in the private

sector As a result, this study may firther encourage more research to be carried out in

performance management

From practitioner’s view this study will give new insights on the performance management thought This will benefit organizations whether public or private to

review their performance management systems to enable them to attain their strategic

goals Managers and leaders of companies may use the results of the study to support employee performance by reinforcing those factors that influence their performance In detail, this study exposes an area within the performance management of JVCs in Vietnam that needs to be improved to ensure and maintain higher performance Thus, this study shall give an opportunity to participating employees to suggest ways they can

maintain or enhance their performance Further, this study also shall be usefull to other

IVCs who may benefit by replicating the study to determine factors which influence

employee performance in their, organizations Moreover, this study may be useful for

benchmarking employee performance within the public service as well as the private

sectors in Vietnam,

1.5 Summary

This chapter presents general theoretical-and statistical background about

employee performance Discussion of the aims of this study and elaboration of

the research questions follow In addition, this chapter explains the purpose of

the study, reasons for the study, and its significance In the following chapters, we

will discuss in-depth the content and results of the research.

CHAPTER 2: LITERATURE REVIEW AND

HYPOTHESIS DEVELOPMENT

This chapter reviews related empirical literature on the subject matter The

relevant literature will be reviewed under the following outline: Mcgregor Theory X and

Theory Y and Herzberg, Mausner and Snyderman's two factor theory This section

brings to light what can be done to improve the employee performance to achieve organizational objectives goals, JVCs in Vietnam is selecting as the dimension to study

the several of factors that can enhances employee's performance

2.1 Theoretical background

2.1.1 Employee Performance

In the organizational context, performance is defined as the extent to which an

organizational member contributes to achieving the goals of the organization

Employees are a primary source of competitive advantage (Luthans & Stajkovic, 1999, Pfeffer, 1994) or to be viewed as resources or assets and values of organizations Employee performance is delineated as the record of outcomes achieved for each job function during a specified period (Deadrick & Gardner, 1997) In this view point, performance is represented asa: distribution of outcomes achieved and could be

measured by using a variety of parameters which describe an employee's patent of

performance over time

Employee performance plays an important role for organizational performance

and is originally what an employee does or does not do Macky and Johnson (2003)

pointed out that improved individual employee performance could improve

organizational performance Further, Darden and Babin (1994) said employee's

performance is a rating system used in many corporations to decide the abilities and

output of an employee Good employee performance has been linked with increased

consumer perception of service quality, while poor employee performance has been

related to increased customer complaints and brand switching

Employee performance could include: quantity of output, quality of output,

timeliness of output, presence at work and cooperativeness (Gtingér, 2011), Moreover,

employee performance is linked to the efficiency of working output and it reflects the

effectiveness of individual in term of assigned tasks (Mathis and Jackson, 2009) In

addition, employee performance is often put into valuation periodically with acceptable

standards or minimum requirements that one employee needs to surpass (Le and

Hwang, 2016) Aguinis (2009) addresses the employee performance as overall result of

working and employee’s behavior and this researcher highlights the importance of

employee perception about his/her performance and this perception contributes directly

to organizational success

2.1.2 Factors Affecting Employee Performance

It has long been established that no single factor could be seen as singularly influencing employee performance substantially to an extent that it can be seen as holding a secret key to performance enhancement A study by Van and Herholdt (2004) found that various factors were responsible for influencing employee performance in an

organization These factors are basically what drive employees to efficiently and effectively work for the organization These factors have beén grouped into five

headings for a more detailed discussion: leadership, organization culture, training,

working environment and motivation

Leadership is a process whereby an individual influences @ group of individuals

to achieve common goals (Northouse, 2007) Leadership is the combination of attitude and behavior of a leader, which leads to certam patterns in dealing with the followers (Dubrin, 2004) The leadership within an organization has a bearing on encouraging or inhibiting employee’s performance (Armstrong & Murlis 2004; Cronje et al 2001)

According to Safferstone (2005), the need for leadership is “a perennial subject

that traces its beginnings to the Old Testament) ancient China, and sixteenth-century Italy” (p 959) Numerous theorists have determined the need of leadership in contemporary organizations and clarified the definitions of leadership (Ardichvili &

Manderscheid, 2008, Bailey & Clarke, 2008, Boaden, 2006; Dalakoura, 2010; Day,

2000, Klagge, 23 1996; Mostovicz, Kakabadse, & Kakabadse, 2009) They have also

asserted the positive impact of effective leadership on organizational performance and

suggested leadership types and leadership development approaches for organizations to

succeed in today’s highly competitive business environment

There is no fixed, universal definition or understanding for culture, and neither

for organizational culture, there is no single definition for it In general, as indicated by Knapp (2006) the organizational concept of culture is an adaptation of the

anthropological concept Researchers in academic sector have given various ways of

defining orgamuzational culture

Organization culture is defined in previous studies and it is considered important concept in human resource management framework (Mehr et al., 2012) O'Reilly and Chatman (1996) define organization culture as a system to share values and norms

among shareholders of the companies Most of previous studies consider organization culture as the combinations of assumptions, norms, values, believes, and point of view

of people within the companies (Deal et al., 1982)

Alvesson (2002:3) used this term as “an umbrella concept for a way of thinking

which take serious interest in cultural and symbolic phenomena” The author also

included values and assumption about social reality in that

In other words, Geert (2014), in his website, refers to organizational’culture as

“the collective programming of the mind that distinguishes the memibers of one organization from others”

Training is defined as set of activities that are conducted by Human resource

managers and finctional managers to increase professional skills and working attitude for the employees (Landy, 1985) When the employees receive training’ it is expected a

significant improvement in personal development, working skills, and job experiences

(Patrick, 2000), The concept of training is also closed to the concept of development and they are often used interchangeably (Obisi, 1996) However, some researchers point out the difference between training and development Steinmetz and Lawrenc (1996)

emphasize that training is often conducted in short term to improve working skills while

development is often carried out in long term and its objective is to upgrade the

employees from staff level to managerial level Miller (2006) emphasizes that training directly supports working performance while development supports the employees’

career path

DeCenzo & Robbins (2000), explain training as a “learning experience, in that,

it seeks a relatively permanent change in an individual that will improve his ability to perform on the job” This mean training must be designed in such a way that, it will

involve the either the changing or enhancing of skills, knowledge, attitudes, and social behavior This change or enhancement of skills, knowledge attitudes, and social

behavior could involve what the employee knows, how he works, his relations and interactions with co-workers and supervisors

According to G.P Nunvi (2006), training programs are directed towards

maintaining and improving current job performance while development seeks to

improve skills for ñtture jobs Considering the progress in the technology, certain jobs

become redundant with the replacement of machines in present days Further education

and competence becomes necessary for those in current positions and those wishing to

be promoted in the future

Expressing an understanding of training, Armstrong (1996), emphasized that training should be developed and practiced within the organization by appreciating

learning of theories and approaches, if training is to be well understood

Working environment is defined as the instruction of work between the managers and the employees regarding to following perspectives: delegation, control, coordination, and communication (Robbins, 2008) Working environment is\depended

on external environment such as economic, society, legal, technology, and politics

(Malik et al., 2011),

Osland (2007) confirm that people spend the majority of their waking hours at work and that the quality of their work experience has a large influence on the quality

of their lives in general, and they acknowledge the fact that every working’ person would

prefer to work ina good working environment They continue to define a great working

environment to be a place-where employees trust the people they work for, have pride

in what they do and enjoy the people they work with

Motivation is fundamental concept within HRM framework and it often refers to

the employees’ behavior (Shazadi et al, 2014) The concept of motivation is

emphasized as the employees’ orientations towards autonomy and freedom of the

employees (Ryan & Deci, 2000, Thomas, 2002) Motivated employees have the demand

of availability in development while less motivated employees do not have such demand (Grant, 2008)

Motivation is significant because even people with the required knowledge,

skills, and abilities will perform pootly if they are not motivated to devote their time and effort to work (Harris in Milapo, 2001: 29)

According to Latham and Ernest (2006) motivation was in the beginning of the 1900s thought only to be monetary However, it was discovered during the 20th century that to motivate employees, there are more factors than just money In their view, employees’ satisfaction with their job is an important indicator for a good job

performance and happy employees are productive To them, motivation is a psychological factor and is affected by the workers’ mental attitude and health Therefore, in order to be motivated, a person needs to have certain basic needs fulfilled

If these needs are lacking, a person’s self-esteem and self-actualization cannot develop This could result in lack of interest to progress and develop, both professionally and personally, There are several theories of human needs, which are the foundation of

motivation

Lindner also indicates that the most difficult role of managers is to motivate employee, because what motivates employees changes always (Bowen and Radhakrishna 1991, 16-22),

2.1.3 Conceptual Framework Development

Through the basis theoretical, the research model focuses on analyzing and measuring the impact of 5 factors including: leadership, organization éulture, working

environment; motivation and training on the employee performance

Figure 2: Conceptual research model

2.1.4 Mcgregor Theory X and Theory Y

Mcgregor Theory X and Theory Y is developed based on how people observe

employee behavior in both of working and personal life perspective (Situma and Iravo,

2015) In this context, Megregor indicates that firms’ observations are conducted upon

on two contrast approaches or theory X and theory Y

Under theory X, the management must ensure that monetary or material or

people as assets of the firms to be obtained The main content of theory X highlights the

nature of human as they are inborn selfish and lazy and therefore they are not able to

perform in good manner In this context, the firms need to provide mechanism that persuade, encourage, reward, and punish the employees to make their employees to achieve individual and overall business objectives and goals (Situma and Iravo, 2015)

Under theory Y, the managers are organized all the elements of productive such

as money, materials, working machine, and people to meet the economic value (Situma

and Iravo, 2015) This theory is contrast to theory X as the employees are not resistant

to organizational needs and goals and the employees are ready to express self-direction

when they commit to cary out tasks that are aligned with overall business goals and objectives (Situma and Iravo, 2015)

2.1.5 Herzberg, Mausner and Snyderman's two factor theory

Frederick Herzberg (1959) is the first researcher whose systematic study led to

identify employee motivating factors Herzberg with his colleagues’ Bemard Mausner and Barbara Snyderman conducted a study on accountants and engineers in Pittsburg,

PA area The result of this study provided a basis for what is referred to as “Herzberg’s

two factor theory” This theory is also recognized as job attitude theory: The study depicted that job satisfaction and dissatisfaction are not contradictory térms (Herzberg,

1968) As cited by Frederick Herzberg (1959), there are two sets of needs There is built

in drive to avoid pain from‘environment and basic biological drive which necessitates

earning money i.e money becomes a specific drive Another set includes ability to achieve and, through achievement, to experience psychological growth The growth in

case of employee in the organization is related to job content Again, the stimuli

inducing pain avoidance behavior is found in job environment Growth or motivators

that are intrinsic to the job are achievement, recognition for achievement, responsibility

and growth or advancement Pain avoidance or dissatisfaction or hygiene factors that

are extrinsic to job are company policy and administration, supervision, interpersonal

relationship, working conditions, salary status and security What makes them different

from motivators is the fact that they are not related to the content of the work but to the context of the job itself (Herzberg, 1974)

Two factor theory is not avoided the criticism from other researchers Nel et al

(2001) highlight that this theory oversimplifies work motivation due to there are other

factors that impact to employee’s job satisfaction and dissatisfaction Gardner (1977)

emphasises about another issue related to this theory as it is formulated upon on

traditional interview method which is subjective manner Moreover, Vroom (1964)

identifies that the employees are expected to more readily recall positive events which

reflect upon themselves, and negative events which can be attributed to external

conditions Although two factor theory gains criticisms from other researchers, this theory is still being used intensively in the studies about job satisfaction (Kim, 2004)

Stiuma and Iravo (2015) mention about the importance of hygiene factor which

is associated with job content and it includes company policy and administration,

technical supervision, salary, interpersonal relationship with supervisors and work

conditions However, hygiene factor is not enough to satisfy the employees, Therefore,

the firms need to acquire motivation factor to encourage the employees to work better and harder Motivation factor includes achievement, recognition, work itself, responsibility and advancement In this context, the study is developed with

concentration of hygiene factor and motivation factor as main explanatory variables to changes of eiployee performance at work

2.2 Hypothesis development

2.2.1 The effect of leadership on employee performance

Concept of leadership is originated from the concept of leadership, As cited by

Stodgill (1948), leadership is defined as the process of influencing the activities of organizations in term of formulating business goals and achievemients Moreover, Anderson et aL (1998) assert that leadership is broaden concept and it covers

compliance, respect, and cooperation among employees and between employees and

their supervisors Meswain (2010) highlights that leadership referring to capacity of the

leaders in term of listening and observing people at work as well as transforming their

expertise to encourage employees to work in better performance The influence of

leadership to employee performance is clarified in previous studies Wall et al (1996) indicate that effective leadership is important due to organization has many employees

and therefore the employees need to be aligned with common business goals and long term development On the other hand, it means that effective leadership is critical

requirement and it enables greater participation of entire workforces as well as

addressing individual performance to contribute to overall business (Bass, 1997;

Mullins, 1999),

From this discussion, H1 is proposed:

HI: Leadership has a positive effect on employee performance at JVCS

2.2.2 The effect of organization culture on employee performance

According to Chow et al (2001), the setup and the maintenance of organization

culture impact to desired outcome both in organization and individual level Rittchie

(2000) identifies earliest studies’ conclusion referring to the fact that organization

culture affects to business outcomes, including employee productivity performance,

and commitment Recent empirical evidences, similarly affirm that organization culture

impacts significantly to employees’ behavior and motivation at work and it also

influences to financial performance of the companies (Holmes & Marsden, 1996) The

reason of organization culture’s impact to employee performance is reflected through its influence to many aspects of the companies’ business lines such» as innovative technologies (Deterts et al., 2000), workplace practices (Hoppock, 1935), IT system (Weber, 1996), business strategy conduction (Cabrera & Lee, 1999), and: business planning (Hellriegel and Slocum, 1974)

From this discussion, H2 is proposed:

H2: Organization culture has a positive effect on employee performance at JVCs

2.2.3 The effect of working environment on employee performance

Working environment is considered as having positive or negative to employee

performance depending on its situation According to Srivastava (2008), working

environment influences on employee performance through two subsets: physical

environment and psychological environment Srivastava (2008) also affirms that

employee performance mnch depends on illumination, noise, atmosphere, etc The

study of Richard (2003) highlights that present company’s take into account their working environment as a tool to push employee performance Mustaffa (2012)

conducts empirical test on the efféct of working environment to employee performance

in comparison with other factors, including training and development, management

involvement, and staff motivation Achieved result shows that working environment has

positive impact to employee performance and this relationship is statistical significant

From this discussion, H3 is proposed:

H3; Working environment has a positive effect on employee performance at

JVCs

2.2.4 The effect of training on employee performance

During the time, there are many studies that bring empirical evidence for

significant impact from training to employee performance On the other hand, it means

that effective training will increase productivity, reduce job tumover rate, and attain job satisfaction fiom the employees (Lee & Teo, 2005, McConville, 2006) The study of Bartlett (2001) highlights that the availability of training decides the level of employee performance through the enhancement of job satisfaction and reduction of turnover

intention Rowden and Conine (2003) identifies that when the employees perceive that

the companies are good in term of learning place, they will contribute more efforts to

assigned tasks and therefore higher working performance Blum and Kaplan (2000)

provide a survey with professional employees and they obtain a result of which training

plays significant role to employee performance Melymuka (2000) also carries out a

survey with more than 500 employees in IT industry and this researcher obtains the

same result,

From this discussion, H4 is proposed:

H4! Training has a positive effect on employee performance at IVCs

2.2.5 The effect of motivation on employee performance

Motivation is considered as explanatory variable of employee performance The

study of Grant (2008) shows that.motivation is the input of performance consequences,

including productivity, performance, and persistence, Moreover, the influence of

motivation to employee performance shows through the fact that high motivated employees often have high organizational commitment and job commitments and

therefore the quality of job is better than less motivated employees (Guay et al., 2000;

Vansteenkiste et al., 2007) Empirical evidence shows that employee performance is

influenced by employee satisfaction at work and this factor, in turn, is influenced by

employee motivation level (Shazadi et al, 2014) For example, Sirota et al (2005) conduct a survey with 135,000 respondents across some countries and they identify that when the companies conduct motivation programs, they will be benefited by three

rewards, including camaraderie, equity, and performance This study also points out high motivated employees have higher output quality than less motivated employees

(Sirota et al, 2005) The study of Asim (2013) also reveals that when the employees are

more motivated, their performance will increase

From this discussion, HS is proposed:

HS: Motivation has a positive effect on employee performance at JVCs

2.3 Summary

In this chapter, two theories are put into examination including Megregor

Theory X and Theory Y and Herzberg, Mausner and Snyderman's two factor theory

‘These two theories highlight about the importance of intrinsic motivators and hygiene

factors to employee satisfaction and employee dissatisfaction Based on these two

theories, a research model is introduced consisting of five factors which are proposed to

have @ positive effect on employee performance, including leadership, organization

culture, working environment, training, and motivation Then the five research

hypotheses are proposed in this chapter.

CHAPTER 3 RESEARCH METHODOLOGY

In this chapter, research methodology will be discussed with the focus on

research design, choice of measures, sample techniques, and data collection methods In

addition, this chapter also highlights how collected data to be controlled in term of its

quality This chapter also presents which data analysis method that will be utilised in

this study

3.1 Research design

As cited by Remeny et al (1998), an academic study is conducted and designed either through deductive design or inductive design Deductive design is considered as a process of applying existing theories and concepts and test them within specific

situation while inductive design is a process to seek for new theories and concepts towards target social phenomenon (Bryman and Bell, 2007) In this study, deductive

design ts chosen due to following reasons:

Firsty the choice of research design is based on the research’s topic (Creswell, 1994) If the research’s topic is common, deductive design should be chosen and if the researcher's topic is rare or is not available before, inductive design shouldbe chosen

(Saunders et al., 2009), This study aims to investigate and to measure the influences of certain factors to employee performance and it is common topic

Second, deductive design gives an ease to the researchers to organize and to

interpret the research’s results (Saunders et al.,.2009), To reduce the time to conduct

this study and the effort to collect data, deductive design is chosen

Given to the choice of deductive research design, this study is conducted with

the first step of examining theories related to the researched topic At first, Herzberg, Mausner and Snyderman’s two factor theory is examined and then, the previous studies

are collected to recognize which factors impacting on the level of employee performance Throughout previous studies, there are several variables to be selected,

including leadership, organization culture, working environment, training, and

motivation These factors are put into hypothesis validation framework and proposed

hypotheses will be validated through primary data It is notable that primary data is collected from survey instrument with self-administered and closed questionnaire Then,

the answers from the respondents are collected and data analysis will be conducted to

further understand about the underlying facts The outcome of data analysis process is

to confirm or to reject proposed hypotheses and it is the basis for revision of theory

3.2 Research model

Based on the literature review, such as Megregor Theory X and Theory Y and

Herzberg’s two factor theory, this research proposes the research model indicated in

Figure 5, including the five factors that have impact on employee performance These

factors are leadership, organization culture, working environment, training and

© Hl: Leadership has a positive effect on employee performance at JVCs

© 2: Organization culture has a positive effect on employee performance at JVCs

© H3: Working environment has a positive effect on employee performance at

JVCs

© H4: Working motivation has a positive effect on employee performance at JVCs

© H5: Working training has a positive effect on employee performance at JVCs

3.4, Choice of measures

In this study, survey of questionnaire is utilised as main primary data collection

instrument The suryey is designed with two sections The first section is designed to

collect demographic characteristics from the respondents It includes gender, age, education, and monthly income Each demographic information is characterised by several groups Gender includes male and female Age includes less than 20 years old,

21-25 years old, 26-30 years old, 31-35 years old, 36-40 years old, and more than 40

years old Education includes University, Community College, and High School

Monthly income includes less than 10VNDm, 10-1SVNDm, 15-20VNDm, and more

than 20VNDm

The second section is designed to collect the respondents’ agree or disagree

towards given survey’s items To do that, a Liker scale of 5 points is applied with 1 as

strongly disagree, 2 as disagree, 3 as neutral, 4 as agree, and 5 as strongly agree The

survey's item is designed with the items are taken fiom previous studies The content of

each survey's item is presented in the table below:

Table 3: Survey's Items

interest in meas person

I feel significant actions have

identified in employee value

OCU | Organization culture

This organization has a good

OCUI

working environment OCU2 || feel valued as an employee

and

facilities equipment

provides by organization

The company provides the ~

right equipment to do a job done well

The noise level at workplace

There is lot of chance to

learn new things in'this

Company

My

atranges training programs

company frequently

for the employees

Doing job in this company |

will benefit to me

Motivation

I feel a sense of personal

satisfaction when I do

this job well

My opinion of myself goes

down when I do the

Shazadi et al (2014)

T take pride in doin job,

I feel unhappy when my

MOV4 > work is not up to my usual

standard

EPE —_ Employee performance

“My performance is better

with similar qualifications

technique gives equal selection to the entity within the population Random sampling is

good in this study due to the study aims to collect the evaluation from different

demographic characteristics of the employees at JVCs

In order to ensure the quality of data analysis, primary data should be collected

from appropriate sample size Suitable sample size is recommended by different

scholars before For example, Hair et al (1998) assert that minimum sample size should

be from 100 to 150, Norusis (2005) recommends minimum sample size from 300

Hoang and Chu (2008) provides the rule of sample size is equal to 5 times bigger than number of variables used in survey of questionnaire Considering previous scholars’

re S

recommendations about sample size, the study is conducted with sample size of 150

employees who have been working for JVCs in Vietnam

3.6 Data collection methods

‘There are two types of data that will be collected in this study, namely secondary

and primary data Secondary data is the information that is not collected by the

researcher but it is available in previous studies or reports (Saunders et al., 2009) Secondary data is often collected from two sources: internal and external sources In this

study, secondary data is collected from external sources that includes books and journals about human resource management as well as empirical literatures about the

impacts of certain factors to employee performance These books and journals are

collected either from the school’s library or from the Internet

Primary data is the information that is not available before or it is collected for

the first time by the researcher (Saunders et al., 2009) The advantage of primary, data is

that it directly supports the study’s objectives and this data is often collected from interview-based or-survey of questionnaire method In this study, primary data is collected from survey of questionnaire with relevant employees who have been working

for JVCs in Vietnam

3.7 Data quality control

To control data quality from survey of questionnaire, a pilot phase of the survey

is established The author prepares a survey of questionnaire and sends it to 10 employees who have been working for JVCs It is notable that these employees are

random selected and they are not friends or relatives with the researcher The objective

of giving the survey of questionnaire to 10 employees is to ensure that the content of the survey is both clear and candid The result from pilot phase shows that all survey's

statements are clear and candid to 10 employees, Therefore, it does not require to revise

the survey's items and the survey of questionnaire is ready to go to official survey

process

3.8, Data analysis method

In this study, there are several data analysis methods that will be utilised in order

to get in-depth understanding about factors affecting on employee performance at JVCs

It includes descriptive statistics reliability test analysis explanatory factor analysis —

EFA, and multiple linear regression.

Descriptive statistics consist of two subsets The first subset is frequency analysis with the count on how many respondents regarding to each demographical characteristic The second subset is mean value calculation According to Sekeran

(2006), if mean value is less than 2.5, the respondents disagree with the survey’s

statement, if mean value is between 2.5 and 3.5, the respondents disagree or agree with

the survey's statement, and if mean value is higher than 3.5, the respondents agree with

survey’s statement

Reliability test analysis is the most data analysis tool to measure reliability of

dimensions of survey scale The reliability level is measured through Cronbach’s alpha

and good dimension has Cronbach’s alpha value higher than 0.6 (Nunnally, 1978) In

addition, this test also requires Corrected Item-Total Correlation value higher than 0.3 (Slater, 1995), Moreover, Cronbach's alpha if Item Deleted value of each variable needs

to be lower than Cronbach’s alpha in overall (Peterson, 1994)

Explanatory factor analysis (EFA) is used when the researchers want to reduce

the number of variables by grouping them into several groups or components (Hair et al., 1998) In order to determine EFA is good for using, KMO and Barlett’s Test are established and validated According to Vaus (2002), EFA is good for using when KMO value is higher than 0.5 and Bartlett's Test is statistical significant at 5% Moreover,

EFA also requires the calculation of factor loadings for new component and required

value is higher than 0.5 (Hinton, 2004) Finally, cumulative eigenvalues are higher than 50% (Dewberry, 2004)

‘The last data analysis technique is rmultiplé linear regression Like previous data

analysis techniques, multiple linear regression also requires some specific

measurements The first requirement refers to calculation of R-Square and the higher value means the higher explanation ftom explanatory variables to dependent ones

(Hinton, 2004), This data analysis technique also comes up with T-Test for

unstandardized and standardized coefficients and T-Test needs to be statistical

significant to confirm the hypothesis (Dewberry, 2004)

3.9 Summary

This chapter aims to identify the suitable research methodology regarding

research objectives Through some arguments and clarification, quantitative research

method is chosen in this study The values of impacts from chosen factors to employee

performance will be clarified through survey of questionnaire with 150 employees at

JVCs and the impacts are measured through some data analysis techniques.

CHAPTER 4 DATA ANALYSIS AND RESULTS

In this chapter, data analysis and results will be presented There are several data analysis techniques that will be used in this study, including descriptive statistics,

reliability test, EFA, and linear regression

4.1 Pilot testing

As mentioned in previous chapter, pilot testing is conducted with the involvement of 10 employees who have been working for JVCs These employees are selected randomly and they are not related or closed to the researcher On the other

hand, 10 employees are selected randomly and they are not friend or business partners

of the researcher The results show that 10 employees agree about the content of survey

of questionnaire in term of its cleanliness and candidness for understanding

4.2 Descriptive statistics

‘There are two types of descriptive statistics: one is frequency analysis and other

is mean value analysis Frequency analysis is conducted for demographic variables and

mean value is calculated for each variable used in conceptual research model It is

notable that there are 150 employees who have been working for JVCs and involved

into the survey process

First, frequency analysis is conducted for demographic variables, including

gender, age, education level, and monthly income (as showed below in Table 4),

As showed in Table 4, there are 95 male respondents and 55 female respondents

to be involved into the survey of questionnaire: The percentage of male and female are 63.3% and 36.7% respectively It means that the number of male respondents is outnumbered the number of female respondents

In term of age, this demographic information is divided into five groups: less

than 25 years old, 26-30 years old 31-35 years old, 36-40 years old, and more than 40

years old The numbers of respondents in these age groups are 46, 53, 38, 6, and 7 people The percentages of these age groups are 30.7%, 35.3%, 25.3%, 4.0%, and 4.7%

It means that the respondents involved into survey of questionnaire are not too old as

more than 90% of them having age less than 35 years old

In term of education, there are three groups: university graduate, community

college graduate, and high school graduate The numbers of respondents who achieve

30.0%, 48.0%, and 2.0% It means that IVCs have quality of staffS, showing through the

fact that only 3 respondents have high school education

Table 4: Demographic description

In term of monthly income, there are four groups: less than 10VNDm, 10-

15VNDm, 15-20VNDm, and more than 20VNDm The numbers of respondents in these income groups are 48, 28, 43, and 31 The percentages are 32.0%, 18.7%, 28.7%, and

20.7% About 50% of total respondents have income less than 15VNDm and about 20.7% of total respondents have above average monthly income which is about

20VNDm

The next step in descriptive statistics is to calculate the mean value with result is

obtained and presented in the table 5 below:

Table 5: Mean value Variables N Minimum Maximum Mean _ Std Deviation

questionnaire

In term of leadership, LEAI, LEA2, LEA3, and LEA@ have mean values of 3.23, 3.39, 2.08, and 2.07 LEA3 and LEA have mean values less than 2.5 while LEAL

do not agree with the contexts of they do not feel significant actions have been taken as

a result of previous grievance by the manager and they do not believe my company’s leadership acts on the issues/opportunities identified in employee value

In term of working environment, WEN], WEN2, WEN3, and WEN4 have mean values of 3.35, 3.37, 3.61, and 3.99 It means the respondents have neutral attitude

towards the statements of their satisfaction with the working space at the office/working

place (discussion room, operation and hall) and with the facilities and equipment

provides by organization The respondents also have high agree on the statements of the

company provides the right equipment to do a job done well and the noise level at

workplace is tolerated

In term of training, TRAIL, TRA2, TRA3, and TRA4 have mean values of 3.31, 3.33, 3.19, and 3.20 and they are all less than 3.5 and higher than 2.5 It means the respondents have neutral attitude towards all current performance of traifiing activities

at JVCS

In term of organization culttre, OCU1, OCU2, OCU3, and OCU4 have mean values of 3.33, 3.57, 3.49, and 3.54 OCU2 and OCU4 have mean values of 3.57 and 3.54 and they are all higher than 3.5 It means that the respondents have high agree on

the contexts of there is lot of chance to learn new things in this company and doing job

in this company is benefit to them, OCU] and OCU3 have mean values of 3.33 and 3.49

and they are less than 3.5 and higher than 2.5

In term of motivation, MOV1, MOV2, MOV3, and MOV4 have mean values of 3.38, 3.39, 3.51, and 3.53, Two last variables have mean values higher than 3.5, meaning that the respondents have high agree on the context of they take pride in doing

my job as well as they can and they feel unhappy when their work is not up to their usual standard,

4.3 Assessment and Refinement of measurement scales

4.3.1 Refinement of measurement scale

Refinement of measurement scale is conducted with the application of reliability

test Reliability test comes up with three requirements: (1) Overall Cronbach’s alpha

value is higher than 0.6, (2) Corrected Item-Total Correlation value is higher than 0.3, and (3) Cronbach's alpha if Item Deleted value is lower than overall Cronbach’s alpha

It is notable that reliability test is conducted for each factor used in conceptual research

model, ineluding employee performanee, leadership, organization culỒture, working

environment, training, and motivation

Table 6: Reliability test result

Code Overall Cronbach's alpha Corrected Item- | Cronbach’s alpha if

Total Correlation Item Deleted

LEA2 0.596 0.816

0.828 LEA3 0.722 0.757