Factors affecting job resignation intention of life insurance agents in dong nai

From the above problems, the Author decided to choose the thesis “ Factors affecting job-resignation intention of life insurance agents in Dong Nai” for the research.. Research objecti

MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HOCHIMINH CITY

DUONG THANH LONG

FACTORS AFFECTING JOB RESIGNATION INTENTION

OF LIFE INSURANCE AGENTS IN DONG NAI

MASTER THESIS

Instructor : Dr TRAN HA MINH QUAN

HO CHI MINH CITY 2012

Class : eMBA K18 Ology code : 60.34.05

ACKNOWLEDGEMENTS

First of all, I would like to thank my advisor Dr Tran Ha Minh Quan

for his enthusiastic and excellent supervision, encouragement and

academic guidance to me during this research He was always there to

listen to me and to give advice as well as reference sources of modern

thesis platform He taught me how to ask questions and express ideas He

showed me different ways to approach a research problem and

encouraged me to be persistent to accomplish any goal

Second, my wholehearted appreciation is also more importantly

dedicated to my family, especially my wife, she was also my MBA

classmate, her emotional and schedule supports have greatly contributed

to completing this academic research and study And then I would like to

give my heartfelt gratefulness to Mr Tam and all my friends in Manulife

Dongnai, who helped me much in completing the questionaire

Finally, I would like to thank HCMC University of Economics for

giving me the good environment to study and chance for improving my

knowledge

TABLE OF CONTENTS

LIST OF TABLES v

LIST OF FIGURES vi

CHAPTER 1: INTRODUCTION 1

1.1 Thesis statement 1

1.2 Research objective 2

1.3 Object and scope of research 2

1.4 Significance of Study 3

1.5 Research framework 3

CHAPTER 2: LITERATURE REVIEW 4

2.1 General view on life insurance and insurance agents 4

2.1.1 Definition of life insurance 4

2.1.2 Insurance agents 5

2.1.3 Job features and requirements of life insurance agents 6

2.1.4 Some basic reasons make insurance agent resign from work 7

2.2 General view of theories related to the job-resignation intention 8

2.2.1 Maslow’s hierarchy of needs (1943) 8

2.2.2 Herzberg’s Two Factor Theory (1959) 11

2.2.3 Adams’ Equity Theory (1963) 12

2.2.4 Alderfer’s ERG theory (1969) 13

2.2.5 Goal setting and task motivation of Edwin Locke (1968) and Kenneth A Kovach (1999) 14

2.3 Studies related to the thesis 15

2.3.1 Study of Nguyen Quang Thu (2005) 15

2.3.2 Study of Đao Minh Tuyen (2008), 17

2.3.3 Study of Vo Quoc Hung and Cao Hao Thi (2009), 17

2.3.4 Study of Vu Mong Thuy My (2009) 18

2.3.5 Study of Nguyen Bich Tram (2012), 18

CHAPTER 3: METHODOLOGY 20

3.1 Studying of affecting factors 21

3.1.1 Objectives of primary research 21

3.1.2 Deployment methods for primary research 21

3.2 Building of research’s models, hypothesis and official variables 23

3.2.1 Research’s models 23

3.2.2 Definition of variables 24

3.2.3 Research hypothesis 31

3.3 Research sample 34

3.3.1 Sample selection method 34

3.3.2 Sample size 35

3.4 Develop scale and design questionnaire 36

3.4.1 Develop scale 36

3.4.2 Design questionnaire 36

3.5 Collect data 38

3.6 Analyze and process data by statistic tools 38

3.6.1 Accredit accuracy of scale 39

3.6.2 Exploratory Factor Analysis 39

3.6.3.Linear regression analysis and accredit research assumptions 40

CHAPTER 4: DATA ANALYSIS AND INTERPRETATION 42

4.1 Sample description 42

4.2 Analysis of scale reliability 46

4.3 Analysis of discovered factors and adjustment of the study models 48

4.3.1 Analysis of discovered factors for variables 48

4.4 Linear regression analysis and hypothesis testing 52

4.4.1 Linear regression analysis 52

4.4.2 Hypothesis testing 57

CHAPTER 5: CONCLUSIONS AND RECOMMENDATION 60

5.1 Research Conclusion 60

5.2 Research Recommendation 64

5.3 Research Limitation 65

5.4 Further Research 66

REFERENCES vii

APPENDIX 1: QUESTIONNAIRE ON FACTORS OF PRODUCTIONS FOR JOB-RESIGNATION INTENTION x

APPENDIX 2: OUTLINE FOR GROUP DISCUSSION xiii

APPENDIX 3: TEMPORARY RESEARCH RESULTS ON VARIABLES AFFECTING JOB-RESIGNATION INTENTION xxi

APPENDIX 4: OFFICIAL QUESTIONNAIRE xxii

APPENDIX 5: FREQUENCY TABLE xxvi

APPENDIX 6: RELIABILITY ANALYSIS SCALE xxxiv APPENDIX 7: EXPLORATORY FACTOR ANALYSIS 1 xli APPENDIX 8: EXPLORATORY FACTOR ANALYSIS 2 xliii APPENDIX 9: RESIDUALS xlv APPENDIX 10: RESIDUALS CORRELATION AND COLLINEARITY li APPENDIX 11: QUESTIONNAIRE ON FACTORS OF PRODUCTIONS FOR JOB-RESIGNATION INTENTION IN VIETNAMESE LANGUAGE lii APPENDIX 12: GROUP DISCUSSION OUTLINE IN VIETNAMESE LANGUAGE lv APPENDIX 13: QUESTIONNAIRE INTERVIEW IN VIETNAMESE LANGUAGE .lxiii

LIST OF TABLES

Table 3.1: The summary table of factors affecting the job-resignation intention 21

Table 3.2: Definition of variables “working challenges” 25

Table 3.3: Variable definition “Relationship among colleagues” 25

Table 3.4: Variable definition “Binding to work” 26

Table 3.5: Variable definition “Income” 27

Table 3.6: Variable definition “Career development possibility” 28

Table 3.7: Variable definition “Imbalance between work and life” 28

Table 3.8: Variable definition “Stable job and treatment policies” 29

Table 3.9: Variable definition “the attention and support from senior managers” 30

Table 3.10: Variable definition “The attention and support from senior managers” 31

Table 3.11: Expected to sign the relationship with the dependent variable 32

Table 4.1: Description of statistical values of the samples 43

Table 4.2: The results of scale reliability calculation 46

Table 4.3: KMO and Bartlett's Test for the dependent variables 49

Table 4.4 Total Variance Explained for the dependent variables 49

Table 4.5: Component Matrixa for the dependent variables 50

Table 4.6: Summarized regression model 53

Table 4.7: ANOVA Analysis 53

Table 4.8: Regression coefficients of the model 54

Table 4.9: Resul to sign the relationship with the dependent variable 56

Table 4.10: Testing of statistical hypothesis (β≠0) 57

LIST OF FIGURES

Figure 2.1: Maslow's Hierarchy of needs Pyramid 1

Figure 3.1: Research process 20

Figure 3.2: The research’s model on job-resignation intention of insurance agents 24

Figure 4.1: Adjusted research model 51

CHAPTER 1: INTRODUCTION

1.1 Thesis statement

Vietnamese people today are usually not used to buying insurance The fastest and most effective marketing ways of Vietnam life insurance sector are direct marketing and oral marketing This means that the life insurance companies owning a large system will have advantages in approaching customers and broadening market

After more than 15 years of launching the life insurance market, the insurance sector went into the situation that hundreds thousand insurance agents who had been employed for less than 12 months stopped working According to the statistic, up to about 80% of life insurance agents close business within 12 first month of starting [15]

The market of life insurance in Vietnam has so far always had demand of recruitment of new agents to develop the business and replace the former ones Currently, the recruitment of insurance agents becomes extremely difficult not for newly established companies in Vietnam but also for big brands like Prudential, AIA, Manulife, Dai-Ichi Life Vietnam, AEC Life and Bao Viet

According to the marking based on the agent duration (for 4 years) of the LIMRA research (under the International Research Organization LL Global), the degree of maintaining in Vietnam is under 10%, meaning that among 100 agents in

2005, less than 10 agents continues working for the next 4 years.[16]

The reality also shows that many life insurance agents have worked for continuous 3 months or six months but they could not get any insurance contracts This situation forced life insurance company to stop the agent contract and few agents opposed this decision because they no longer had interest in this job

These above facts have place many questions to the Author:

- Why for a highly potential life insurance market in Vietnam and for a job considered to bring a quite high income, the life circle of insurance agents is short as such?

- What are the reasons for the job resignation of life insurance agents? What are the impacts of these reasons? What are common features among agents in this problem?

- In Dong Nai, where the Author is living and working, how is the situation of agent’s resignation?

- How to limit the job resignation intention of life agents?

From the above problems, the Author decided to choose the thesis “ Factors

affecting job-resignation intention of life insurance agents in Dong Nai” for the

research

1.2 Research objective

The research has been done with two main objectives:

Firstly, determining and analyzing the factors affecting job-resignation intention

of life insurance agents in Dong Nai

Secondly, giving out some recommendations for insurance company to minimize the resignation decisions of life insurance agents

1.3 Object and scope of research

- Research objects are factors affecting the job-resignation intention of life insurance agents

- Research scope is restricted to the insurance agents in Dong Nai province

- Time of research is from early 2012 to the end of the second quarter 2012

1.4 Significance of Study

So far, there is no deep and thorough researches on job-resignation intention of life insurance agents, so the Author hope that the thesis will give some significances

- The thesis will contribute to explaining the job-resignation of insurance agents

in Dong Nai over this time, it also explain the phenomena of “too short experience time” of about 80% of the newly recruited agents

- Therefore, the thesis contributes to finding solutions for minimizing the job resignation of agents, then contributing to supporting to insurance enterprise to expand the market, business areas, customers in a stable way through developing and maintaining the effective performance of agents

- The thesis is also the useful reference for insurance business enterprises, researchers wishing to learn about the insurance sector, agent development as well as study on behavior science in general

1.5 Research framework

Based on the researched problem, objectives and research questions, the structure of the thesis “Factors affecting job-resignation intention of life insurance agents in Dong Nai” will be divided into 5 chapters as followed:

Chapter 1: Introduction Chapter 2: Literature review Chapter 3: Methodology Chapter 4: Data analysis and Interpretation Chapter 5: Conclusions and Recommendation

CHAPTER 2: LITERATURE REVIEW

2.1 General view on life insurance and insurance agents

2.1.1 Definition of life insurance

The life insurance group AIG ( U.S) defines that “ Insurance is a mechanism, according to this mechanism, one person, one enterprise or one organization transfer risk to an insurance company which will indemnify the insured for the loss of coverage premiums and losses were divided among all the insured”

According to the insurance business law of Vietnam (issued on 09th December 2000) “ insurance business is the operation of an insurer for profit, under which the insurer accepts the risk of the insured on the basis of the insurance premium payment

to the insurer so that the insurer can pay to the beneficiaries or make compensation to the insured when the insured event occurs.”

Also according to the insurance business approved by the Vietnam National Assembly and valid from 01th July 2001 “ Life insurance is a kind of insurance profession for the cases of insured’s living or death”

According to the amendment and supplemetation of some articles in the insurance business law no 24/2000/QH10, life insurance includes whole life insurance; term life insurance; endownment; recurring insurance; investment-linked insurance; pension insurance

So, life insurance can be understood on two views, technique and law In respect to technique, life insurance is insurance with commitments in which the commitment implementation depends on the human life-span There are two main commitments in life insurance including premium payment commitment of the insured and the indemification payment or periodic allowance payment of the insurer

In respect to the legality, life insurance includes insurance contracts signed between insurers and the insured, under which, for receiving premium from the insured, the insurers commit to pay to one or more beneficiaries the certain amount or periodic allowance in case the insured live for a certain time or die before the specified time in the contract

2.1.2 Insurance agents

The insurance law no 24/2000/QH10 9/12/2000 has defined the insurance agent

is an individual or an organization who is authorized to perform as an insurance agent based on the agent contract according to regulations of this Law and of related laws

Insurance agent operation is the introduction, selling of insurance He will arrange the connection between the insurance contracts and other tasks to ensure the implementation of the insurance contracts according to the authorization of insurance companies The article no.86 of the insurance business law regulates that individuals who are Vietnamese citizens living permanently in Vietnam from the age of 18 with sufficient competence and civil behaviors, holding the working license granted by the insurance companies or the Vietnam Insurance Association are allowed to perform as

an insurance agent

Insurance agents can be authorized by the insurance companies to do the following work:

• Introduction and selling of insurance

• Arranging the insurance contract;;

• Insurance premium collection

• Make arrangements for settlement of compensation, pay a indemnification when the insured event occurs;

• Perform other activities related to the performance of insurance

2.1.3 Job features and requirements of life insurance agents

Currently, insurance companies usually distribute their products to customers mainly through the insurance agents, so the roles of insurance agents are always considered to be important because they are the most important volunteers in transferring the insurance’s preeminent features to customers They are on behalf of the company to sign the insurance temporary contract with customers and bring the revenue to the companies They are people who care customers to maintain the good relationship between customers and companies

Normally, insurance agents are considered as the producers in insurance business, they sell one or more kinds of insurance like life insurance, asset insurance, injury insurance, health insurance, insurance for the disabled and long-time services

Insurance agents can be representatives for some companies and they can introduce to customers the insurance contract of the best price and information Insurance agents have to prepare reports and find out more new customers In case of loss, the agents will help customers with getting compensation provided by insurers In addition, some insurance agents also provide customers with financial advices and analysis to help them with minimizing risks

The work of insurance agents is not restricted in term of time, so it suits many people from State officers wishing to find a part time job, students to small businessmen, even housewives When working in a insurance company, the insurance agents will be partners of the insurance company, not the employee

To become an insurance agent, you must have some qualities like perseverance and patience You must also understand the specific characters of the job and accept to walk on this uneven path The insurance consultancy requires agents to have long-term plan for the career They themselves draw lessons after the failure, they know how to stand by themselves and continue to overcome challenges

2.1.4 Some basic reasons make insurance agent resign from work

-.In developing countries, insurance agents usually work overtime, but in Vietnam, the part time agents account for 90% Insurance agents working overtime will sign the labor contract and receive the basic salary based on the minimum salary rate However, in nature, their main income is from commission for selling insurance apart from the fixed salary, so they are partly ensured of the income to continue working Whereas in Vietnam, insurance consultants are people who create main revenue for themselves, they do not have fixed salary and do not receive welfares from the company So, the problem of job quit and change become harder to the alarming level

- The recruitment is important but it is more important to maintain the agent team Many insurance enterprises only recruit but not select carefully, as the result, the revenue and benefit they get from a number of agents is very low, the training of insurance agents is only the appearance, reluctance The trainings do not last for enough time as regulated The tests were taken place without report There were also the frauds in testing

- In some countries, the insurance consultancy job is as important as the securities investment consultancy It means that insurance agents must go over a complicated training and test so that they can give advice on finance planning for customers, instead of only selling the insurance products However, in Vietnam, the recruitment and training are not focused appropriately

- For some newly established insurance companies in Vietnam desiring to compete with long-time established companies, they have to build strategies to loosen the policies and increase benefits to attract personnel from other companies However,

it creates some certain problem, which is the insurance company’s negative impression

on insurance agents

- To chase for revenue and market shares, some companies do not pay enough

agents, causing the conflict in appealing agents among companies and between agents and customers Some companies only spend several days on training, so the number of graduated agents is high but the number of agents getting contracts is very low Contracts are mostly from closed people When there is no closed people to consult, they cannot find others This situation is currently happening to the insurance market of Vietnam.

For the above issues, regardless of new establishment or long-time establishment, insurance companies are always facing the circle of recruitment, training and then recruitment and training

For sustainable development, life insurance companies should focus more on training and career orientation for the insurance consultancy team, so that they can bind

to their work Besides, the strategy of training and development of a business management team from the successful agents who have good career ethics is an effective method to keep the talented in the company, preventing the grey-matter bleeding among life insurance companies

2.2 General view of theories related to the job-resignation intention

2.2.1 Maslow’s hierarchy of needs (1943)

This is the theory proposed by the psychologist Abraham Maslow in 1943, since then, this theory is applied widely to the real situation in many countries and many enterprises

In 1943, the psychologist Abraham Maslow (1908-1970) has developed one of theories whose influence has been widely recognized and used in different sectors, which is the Hierarchy of Needs of people In this theory, he arranged people needs in a hierarchy order, in which the needs of higher stage only appear when the needs of lower stage are satisfied

Maslow has arranged the people needs in 5 stages including physiological needs, safety and security, love and belonging; self-esteem; self-actualization The hierarchy system is usually expressed by a pyramid The basic contents of needs are as followed:

Physiological needs: These needs are also called the body needs or the

biological needs including basic needs of human being like eating, drinking, sleeping, air for breathing and needs for living comfortably and so on They are the most basic and strongest needs of people In the pyramid, we can see that these needs are placed first at the most basic stage

Safety and security: When people are satisfied with the basic needs, it means

that these needs no longer control their thought and actions, what do people need next? The answer is the safety and security The need for safety and security is expressed

Figure 2.1: Maslow's Hierarchy of needs Pyramid

danger This need will become motion force for taking actions in emergency and hazard like in war, natural disaster or seeing predators and so on

This need is normally expressed by the desire for the stable life, living in a secured place, in a social legislation, in houses and so on For these needs, many people find shelter from religion, physiology, which is the searching for psychological security The social insurance, retirement allowance and savings plan and so on are also the expression of the security needs

Love and belonging: These needs are also called the desire of one part or one

organization or the needs for love These needs are expressed by the communication like searching and making friends, lovers, making family, participating in one certain community, working, going picnic, becoming member of clubs, team working and so

on

Although Maslow has placed these needs above the two mentioned needs, he highlighted that if these needs are not satisfied, it will create critical psychological diseases Many recent researches show that single people are more likely to suffer from diseases of digestion, mental problems and respiration problem than people living with family

For meeting the third layer of needs, many companies organized extra-activities like outdoor camping, collective game playing, team working and so on The results show that the common activities bring good impacts on psychology, then the working efficiency is increased, the job-resignation intention will be decreased

Self-esteem: This need is also called the self-esteem with two versions including

the need for being respect from others, recognition of personal achievements and the need for self-esteem, personal fame with respect and belief in personal ability When the need is satisfied, laborers can work more effectively

We can see in working or in life, when a person is encouraged and rewarded for his achievements, he will be ready for working harder and more effectively After entering one organization, one team, people always want respect from others, at the

same time, they will improve themselves to feel “having position” within this organization

Self-actualization: It is not random to place this need on the highest layer of the

pyramid Maslow describe this need as “self-actualization as a person's need to be and

do that which the person was “born to do” In simpler saying, this is the need for using

up all ability and potential to determine himself, to work and to achieve successes in the society

It is the theory of people needs and it is considered and applied in this research because only when the needs of insurance agents are met, they will have working satisfaction In another way, leaders or managers can control the behaviors of insurance agents by using tools or methods to affect their needs or desires, making them more enthusiastic in working In contrast, the insurance agents will lower their working enthusiasm, and then the job-resignation intention will increase They will decide to quit the current job and find a more suitable alternate job

2.2.2 Herzberg’s Two Factor Theory (1959)

Two Factor Theory or Herzberg's Motivation-Hygiene Theory was given by Frederick Herzberg, a psychologist This theory bases on mainly the survey results and analysis in Pittsburgh, Pennsylvania This theory divides the factors into two kinds:

Hygiene factors: If the hygiene factors are met, people will do not have

dissatisfaction, if not, people will feel dissatisfied This factor includes

• The working inappropriate supervision

• Working conditions do not satisfy laborer’s desires

• Salary and other remuneration are not reasonable with unfair factors

Motivator factor: If this factor is met, laborers will have satisfaction in working,

if not, they will not have working satisfaction The factor includes:

In general, this theory helps managers know the factors causing the dissatisfaction to staffs, then know how to eliminate these factors For example, insurance agents can feel dissatisfied with the work because they find it hard to get a contract with customers Therefore, the mangers must know how to encourage them and give them more training, consultancy and finding causes for the ineffective performance of insurance agents, then support them to get the contract However, when the dissatisfaction factors are eliminated, it does not mean that staffs will feel satisfied

If the managers want to encourage them, making them satisfied with their job, the managers should focus on factors like success, recognition and job assignment Staffs will feel satisfied with their job when they are assigned with a right task which suit their ability and personality with training opportunity to increase career skills and promotion opportunity

2.2.3 Adams’ Equity Theory (1963)

J.Stacey Adams said that laborers tend to evaluate the equity by comparing between the inputs that they bring to a job and the outcomes that they receive from it against the perceived inputs and outcomes of others If the result is in equity, they will

continue their working effort and performance If the remuneration is over their desire, they will tend to increase their effort in working, in contrast, if the remuneration is lower than what they contribute , they will tend to lower their effort or find other solutions like absence from work or job resignation (Pattanayak, 2005)

This theory can be considered from the angle of this thesis One agent cannot have satisfaction if they recognize that there is no equal compensation for their effort There are many lasting difficulties in working, making them less enthusiastic and bored

to the intention of resignation from work

2.2.4 Alderfer’s ERG theory (1969)

The ERG theory was given by the scholar Clayton Alderfer, which is the successful supplementation and amendment for the Abraham Maslow’s Hierarchy of needs ERG theory proposes three types of main needs of human being:

Existence needs: it includes an individual’s physiological and physical safety

needs These needs are expressed through the basic needs like biological needs, needs for food, clothing, accommodation, travelling and studying and the needs for safety

Relatedness needs: These include the aspiration individual’s have for

maintaining significant interpersonal relationships Each individual will have desire for establishment and maintaining the different personal relationships It is estimated that each individual will spend half of their time on communicating with their targeted relationship

Growth needs: The needs for personal growth and development in both life and

work Jobs, professions and higher the separate career will ensure significantly the satisfaction of development need

According to the ERG theory, at a same time, there may be many needs affecting the motivation if a higher- level need aggravates (frustration), an individual

This model was built based on the hierarchy of needs of Maslow, it is the further development of the pyramid In fact, there are many researches supporting this theory rather than Maslow’s theory

ERG theory of Alderfer also shows that normally more than one influencing need in one human being at the same time if the fulfillment of a higher-level need is subdued, there is an increase in desire for satisfying a lower-level need

Clayton Alderfer identified this phenomenon in one famous professional term

“frustration and shy aggression dimension” It affects the work in a way that even when the needs of higher-level are not fulfilled , the work still ensure for the biological needs

of the low-level and the individuals will focus more on these needs

At this time, if there is one occurrence threatening the current job, the basic needs of individuals will be threatened If there are no factors to answer to their worry,

an individual is easily drowned in the desperation and panic

The ERG explains why staffs usually search for higher-salary jobs and better working conditions, even when the current working conditions are good as per standards of the labor market When staffs do not feel satisfied with the current communication and growth needs, they will find way to satisfaction

2.2.5 Goal setting and task motivation of Edwin Locke (1968) and Kenneth A Kovach (1999)

In the end of 1960s, studies of Edwin Locke showed that the detail goals and challenges will output better working performance Edwin Locke believed that the working attempt for reaching a target is the main root of motivation Therefore, to create the working motivation, it is necessary to set out detail challenging goals as well

as attracting laborers in setting goals For learning more about the working motivation

of staffs, the model of ten motivational factors related to the work features was developed by Kenneth A Kovach This model was built first by the New York Institute

for Labor Relation Research in 1946 and currently applied in the world and in organizations of Vietnam The scale of motivation includes 10 following factors

• The binding of leaders and companies to staffs

The theory of goal setting and working motivation creation has great significance in identifying the factors affecting the job-resignation intention of life insurance agents

2.3 Studies related to the thesis

2.3.1 Study of Nguyen Quang Thu (2005)

“Analyzing the labor fluctuation and some measures to minimize the human resource risks in timber processing sector in Ho Chi Minh city”

The study has shown that the labor alternation will has bad impacts on organization, not only by the direct money loss but also the efficiency and spirit of the remaining people Therefore, to find out the causes of labor alternation is very necessary, it helps enterprises with having feasible measures for reducing the number

of laborers who quit job, at the same time, increasing the operation effectiveness of the organization The Author Nguyen Quang Thu also showed some causes of the job

- The economy: The economic development trend is one of the most common causes for the job quit because laborers want to find a higher-income job

- Corporate culture: It includes the issues of salary and bonus system, strength of the corporate leaders, friendly working environment and the mutual sharing and so on

- The effective operation of the organization: For an organization in financial difficulty, the job resignation rate will increase because laborers believe that it is reasonable to find other job

- Job features: The working attractiveness, whether it brings about the challenges or promotion opportunities

- Illusion about the company: Many candidates have illusion about their future job which is offered by the company When this illusion is not implemented, laborers will feel disappointed and decide to leave the company

- Demography: Experimental studies show that laborer alternation is a special situation with demographic characteristics and history record of workers, so this is a very important issue in which the company needs to check their laborer’s history record

- Individuals: Among factors affecting the laborer alternation, there is one special factor which is the personal characteristics of the laborers including the changes according to the family condition changes, learning a new skill and so on Also, other related personal characteristics are laziness, regular absence from work, stealing or causing destruction to the machines and equipment of the company

The above causes can be divided into three kinds:

- Voluntary resignation: The employee quit voluntarily because they do not like working in the company or they are not happy with the wages and working conditions,

or they do not like people who work with them or because of personal problems such

as transport, housing difficulties Regardless of which causes are, the voluntary resigning people also think that they could do a better job somewhere else

- Management cause: The managers decide to fire some staffs because they are working ineffectively, they are not suitable for this position or they are punished by being always late for work or absent from work without any obedience

- Obligatory resignation: Laborers stop working because of the labor force redundancy or the economic crisis or the reorganization of the company

2.3.2 Study of Đao Minh Tuyen (2008),

“Factors affecting the intention of job change of staffs in service division- Vietnam Airline Corporation”

Objective: Study on the intention of changing job of employees in one specific sector

Study result: There are seven factors affecting the job changing intention of service sector- the Vietnam Airlines Corporation including the professional pride and the care for the company, the care and support from manager, the attractive job, the Benefits and the development, the Imbalance between life and work, equity, overtime working requirement

Study’s limitation: The study is only on the service sector, particularly the Vietnam Airlines Corporation

2.3.3 Study of Vo Quoc Hung and Cao Hao Thi (2009),

“Factors affecting the job-resignation of State employees”

Study’s objectives: Indentifying the factors affecting the job-resignation intention of State employees

Study’s results: There are 8 factors affecting the job-resignation intention of State employees including the suitability; leadership behavior; Workplace Relations; training and development; salary, bonuses and recognition; Communications; the love and the physical work environment

Limitation of the study: The study is only done for personnel as State employees Study objects are state employees with the specific characteristics of working manner as well as the working environment In addition, the study is conducted in only some fields and in three provinces over 64 provinces in the country

2.3.4 Study of Vu Mong Thuy My (2009)

“Factors affecting working place changing intention of workers”

Study’s objectives: Identifying factors affecting the working place changing intention of workers

Study’s results: The working place changing intention of workers depends on 5 factors which are arranged in descending order of impact as followed: the binding to the company ; stable jobs and treatment regimes; the attention and support from senior managers; relationships between colleagues; Imbalance between life and work

Study’s limitation: The study is only conducted for the manual workers in large industrial zone in Binh Duong and Hochiminh city

2.3.5 Study of Nguyen Bich Tram (2012),

“Factors affecting the job-resignation intention of office staffs in Hochiminh city”

Study’s objectives: Identifying factors affecting the job-resignation intention of office staffs in Hochiminh city and proposing petitions for minimizing the job resignation in companies in Hochiminh city

Study’s result: The job resignation intention of staffs depends on 5 main factors including attention and support from superiors, the binding to job and the company, career development possibility, Imbalance between life and work; income The author has used the EFA analysis techniques, regression, P Value Inspection and has given regression model for the job-resignation intention as followed:

DD = -0,189*GK – 0,300*QL + 0,09*DN – 0,171*TL – 0,233*PT – 0,204*CB

Where: DD: Job-resignation intention

GK: Binding to the job and the company

QL: Attention and support from senior managers

DN: Relationship among colleagues

TL: Income

PT: Career development possibility

CB: Balance between work and life

SUMMARY OF THE CHAPTER 2

In the chapter 2, the author has presented generally the life insurance and insurance agents including definition of insurance, life insurance, insurance agent problems, features and specific characteristics of the job of insurance agents; basic causes for the job-resignation of the agents Next, the author has systemize the theories

on behaviors and motivations including the Maslow’s hierarchy of Needs (1943); Two factor’s theory of Herzberg (1959); Equity theory of Adam (1963); ERG theory of Alderfer(1969); Goal setting and task motivation of Edwin Locke (1968) and Kenneth A.Kovach (1999)

On these backgrounds, the author has referred to related studies of researchers

in the country on this issue including Study of Nguyen Quang Thu(2005), “Analyzing the labor fluctuation and some measures to minimize the human resource risks in timber processing sector in Ho Chi Minh city”; Study of Dao Minh Tuyen (2008)

“Factors affecting the intention of job change of staffs in service division- Vietnam Airline Corporation”; Study of Vo Quoc Hung and Cao Hao Thi (2009) “Factors affecting the job-resignation of State employees”; Study of Vu Mong Thuy My (2009)

“Factors affecting working place changing intention of workers”; Study of Nguyen Bich Tram (2012) “Factors affecting the job-resignation intention of office staffs in Hochiminh city”

CHAPTER 3: METHODOLOGY

In the chapter 3, the Author will present about the study process, models and variables, data collection method, analysis method, data processing, statistical tools and techniques supporting for answering the study questions All of the study contents will

be demonstrated by this following diagram:

Figure 3.1: Research process

Identifying the problems and the research objectives

Primary research of the affecting factors

Building of models, hypothesis and official variable Building the model

Identifying the research models

Building of the scale and questionaires

Deployment of data collection

Analysis and processing of data by stastistical tools

Conclusion about the researched problems

3.1 Studying of affecting factors

3.1.1 Objectives of primary research

- For clearly identifying and selecting basic factors affecting the job-resignation intention of life insurance agents in Dong Nai; for serving the next researches

- For learning about the responses, attitude and contributing recommendations from life insurance agents before the questionnaires and problem statements in the survey; for adjustment and completion methods before official deployment

3.1.2 Deployment methods for primary research

- Giving out hypothesis and listing variables affecting the job-resignation

intention of life insurance agents: By referring previous studies by authors out and in

the country on working behavior, motion force and job-resignation intention of employees; the author has given out estimated summary table of factors affecting the job-resignation intention of life insurance agents as below:

Table 3.1: The summary table of factors affecting the job-resignation intention

No Factors affecting the job-resignation

intention

Author

10 The relationship among colleagues Vo Quoc Hung and Cao H Thi

Site: Author’s survey

- Selecting 50 life insurance agents who are working in Dong Nai to collect

ideas, opinions on factors affecting the job-resignation intention of life insurance

agents in the area

- Method of deploying the idea and opinion collection from these agents:

Divided into two stages

+ 1st stage: The Author called and then sent email with attachment of multiple choice questionnaires of factors affecting the job-resignation intention of life insurance agents

+ 2nd stage: The Author divided 50 agents into 10 groups (5 people in each group) and conducted in steps the discussion with ten groups separately on the factors affecting the job-resignation intention of agents In the discussion, the Author gave out the situation and listed as in the table 3.1; after that agents discussed together and agreed to choose the most basic factors affecting the job-resignation intention and give the explanation for what they have selected

Content and result of the group discussion are presented in detail in the appendix 1, 2, 3 of this thesis They are bases for building models, study’s hypothesis and variable’s definition of the thesis’s later parts

3.2 Building of research’s models, hypothesis and official variables

3.2.1 Research’s models

Based on the result of the primary research as well as reference to the previous studies (as presented in the chapter 1) and typical characteristics of life insurance agents, the Author proposes the research’s model as below:

The model includes 8 basic variables affecting greatly the job-resignation intention of life insurance agents

Source: The author’s proposal

Figure 3.2: The research’s model on job-resignation intention of insurance agents 3.2.2 Definition of variables

Working difficulties and challenges: Currently the life insurance market is in the

stage of fierce competition, so people of this sector have to accept challenges, frequently be self-trained and refreshed in order to not being lagged behind The requirements to the life insurance business are patience, passion and far strategic vision

for the career Competent people of this sector who can bind to the job for a long time

are the patient people accepting to walk on the uneven road of the life insurance business In addition, insurance consultants have to know how to draw out a long-term plan for their career, at the same time, they know how to create challenges and they are self-improved days by days [22]

Working difficulties and challenges (X1 – 5 variables)

Relationship among collegues (X2 – 4 variables)

Binding to job (X3 – 6 variables)

Income (X4 – 3 variables)

Career development possibility (X5 – 4 variables)

Imbalance between work and life (X6 – 3 variables)

Stable job and treatment policy (X7 – 4 variable)

resignation of insurance agents (Y – 5 variables)

Job-Attention &support from managers (X8 – 5 variable)

Table 3.2: Definition of variables “working challenges”

Research’s

variables Variable description

Variable encoding

The competition in life insurance sector is

The high possibility of being refused by

The push for individual skills training when

Working

challenges

(X1 includes 5

variables)

Ability of establishment, implementation

Source: Author’s proposal Relationship among colleagues: It is the relationship among individuals

working in a common environment Individuals working in a friendly atmosphere in which all are ready to support each other and they co-ordinate harmonically to well finish the tasks Besides, they can share many things, not merely the works Beside the colleagues and in such group, agents will have less idea on job-resignation

Table 3.3: Variable definition “Relationship among colleagues”

Research’s

variables Description of variable

Variable encoding

Your colleagues always co-ordinate well to

Your colleagues always give out advices

The work binding: is considered to be the binding between life-insurance agents

and insurance sector with the enthusiasm and passion to the work; understanding the humanism meaning of the insurance; understanding that the selling of one insurance contract does not merely bring about the financial benefit but the happiness, safety and financial safety for many people and family, then they will feel more attached to work The insurance agents with enthusiasm and passion to the job they are doing will have

no intention of resignation In contrast, when they find no interest in the current job while the company has no actions for promoting their binding, they are likely to resign from job

Table 3.4: Variable definition “Binding to work”

Research’s

variables Variable description

Variable encoding

You always care for the existence and development of the company you are working for

X31

You feel that this company is one part of

Your current career is determined to be

Binding to work

(X3 includes 6

variables)

You always feel that the company’s

Site: Author’s study and proposal Income: Includes the commission from selling insurance, periodical bonus,

revenue bonus, other bonuses and other allowances (if any) which the insurance agents receive When the insurance agents find that they have high income, they will work

better and feel more satisfactory with the current job In contrast, if they find that they are receiving income lower than they are deserved, they will have a plan to stop working In addition, insurance agents will stay with the job if their benefits are bonded for a long time with the company

Table 3.5: Variable definition “Income”

Research

variable Variable description

Variable encoding

You receive the worthy income with your

Source: Author’s study and proposal

Career development possibility: Includes the promotion, training and the

opportunity of personal and career development This is considered to be one of the human resource investment type All the employees themselves wish for the promotion For reaching it, they made all of their effort to work effectively for being promoted If they find the opportunities, they will not think of changing job In addition, employees always desire being trained and improved the professional skills

so that they feel confident in working and hoping for promotion and personal development

Table 3.6: Variable definition “Career development possibility”

Research

Variable encoding

The company help you have clear plan for training

You are oriented and trained suitably for the

variables) The company always creates favorable promotion

Source: Author’s study and proposal Imbalance between life and work: The ability of adapting to the work together

with the proper imbalance between life and work Insurance agents are always happy when they fulfill both the work and life’s responsibilities In other way, when insurance agents feel stressed from work and life, they can imbalance the time spending on work and on personal life Then, they will have idea of resigning from work

Table 3.7: Variable definition “Imbalance between work and life”

Research

variable Variable description

Variable encoding

Your current work pressure to your family’s

Stable job and treatment policy: Once the work creates the steady confidence,

they will not be affected by the objective factors They will not worry about losing job

or alternated to other divisions or being unable to ensure the family’s life In addition, the company has the fair policy of reward and punishment When the benefits of insurance agents are ensured, they are awarded that they have development opportunities and they will not think of job-resignation

Table 3.8: Variable definition “Stable job and treatment policies”

Research

variables Variable description

Variable encoding

You make good use of capacity for your

Your company comply with all the social

Stable job and

treatment policy

(X7 includes 4

variables) Your company always have encouraging

Source: Author’s study and proposal Attention and support from senior managers: Includes attitude, sayings,

behaviors and so on which the senior managers express to their insurance agents They understand and sympathize for each situation and difficulty the agents are facing Such managers can build up the trust from insurance agents by understanding any situation which the agents are facing Therefore, the attention from senior managers influences greatly the working effectiveness of the insurance agents If they feel they are well treated with care, support, sympathy, high appreciation from senior managers, they will try their best for the work and contribute more to the organization

Table 3.9: Variable definition “the attention and support from senior managers” Research

variables Variable description

Variable encoding

Your senior managers are friendly and

Your senior managers recognize your

Source: Author’s study and proposal Job-resignation intention: The intention of leaving from the current working

environment to other working environment, other job The job-resignation intention depends much on many factors like the improper salary and bonus, problems in working environment, relationship with senior managers and colleagues, corporate culture and so on The job-resignation intention of insurance agents is usually result of the selection over a certain time when they feel that the current work or the current working place does not meet all of their demands

Table 3.10: Variable definition “The attention and support from senior

managers”

Research

variables Variable description

Variable encoding

You do not have intention of working for a

You think that you will find another working

You will change the working place if you

You consider this company as a temporary

You like changing job and will find another

Source: Author’s study and proposal

3.2.3 Research hypothesis

The job-resignation intention of insurance agents ( Y includes 5 variables) and factors including working challenges (X1 includes 5 variables), relationship among colleagues (X2 includes 4 variables), the binding to work (X3 includes 6 variables), the income (X4 includes 3 variables), career development possibility (X5 includes 4 variables), imbalance between work and life (X6 includes 3 variables), stable job and treatment policies (X7 includes 4 variables), the attention and support from senior managers (X8 includes 5 variables) which have the linear relationship and be expressed through the following regression function

Table 3.11: Expected to sign the relationship with the dependent variable

relationship with the dependent variable

Hypothesis X1 (β1≠0)

• H10: The increase or decrease in “the working challenges and difficulties” will increase or decrease the job-resignation intention accordingly

• H1A: There is no connection between “the working challenges and difficulties” with the job-resignation intention

• H7A: There is no connection between “the stable work and the treatment