Solution to reduce ambiguity at interlog company

Based on secondary data such as annual HR report of the company in two years 2013 and 2014, and reports of exit interviews and primary data – I used qualitative method – in-depth intervi

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Huynh Thuy Tien

SOLUTIONS TO REDUCE AMBIGUITY AT INTERLOG COMPANY

MASTER OF BUSINESS

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Huynh Thuy Tien

SOLUTIONS TO REDUCE AMBIGUITY AT INTERLOG COMPANY

ID: 21130004

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: NGUYEN THI MAI TRANG

ABSTRACT

Today, Logistics is one of the sectors are high-speed development in Vietnam

Therefore, the need for personnel especially employees who have expertise, capabilities and experience is a critical requirement of Logistics industry The recruitment has been difficult, the retention of personnel is one of the issue of concern of Logistics Companies And for InterLog it is no exception, in recent years, high employee turnover rate is problem which BOD of InterLog always think about Thorough this study, I find out four key causes lead to that problem, they are: conflict, ambiguity, salary and reward system, and high pressure In which I focused analysis and propose some alternative solutions to the ambiguity issue

TABLE OF CONTENTS

I – EXECUTIVE SUMMARY 1

II- PROBLEM DEFINITION 2

2.1 Background of InterLog Company 2

2.2 Current situation of InterLog Company 8

2.3 First cause: Conflict 11

2.4 The second cause: Ambiguity 14

2.5 The third cause: Salary, Reward System and High Pressure 19

III – ALTERNATIVE – ANALYSE ALTERNATIVE CHOICE 31

3.1 First alternative solution 32

3.2 Second alternative solution 35

IV- ACTION PLAN 39

V- CONCLUSION 40

VI- SUPPORTING INFORMATION 41

REFERENCES

LIST OF TABLES

Table 1: Employee turnover rate in 2013 – 2014 9

Table 2: Position of employee leave in 2013-2014 9

Table 3: Turnover rate of each department in 2013-2014 10

Table 4: The comparison between average salary increase and inflation rate 20

Table 5: List of antecedents of job satisfaction and commitment of previous researches 24

Table 6: Benefits and Cost of building a new working process 34

Table 7: Benefits and Cost of setting up a clear goals 38

Table 8: Action plan for two solutions 39

Table 8: Position and Work Experience of Respondents (in years) 44

Table 9: Position and Work Experience of Respondents (in years) 54

LIST OF FIGURES

Figure 1: Salary Increase In Vietnam from 2004 – 2015 21

Figure 2: Diagram for main causes lead to high turnover rate in InterLog 23

Figure 3: Results of incident analysis at InterLog 31

Figure 4: Supply Chain Process of InterLog Company 33

ACKNOWLEDGEMENTS

The completion of my Master thesis represents the end of my academic training in International School of Business (ISB) I want to take this opportunity to give my gratitude

to a select few for their time, talent, assistance and encouragement in the past two years

First, I am greatly indebted to Professor Nguyen Thi Mai Trang, my advisor, who was always very patient and kind to give me suggestions and ideas in my work She was really helpful in the whole process of this thesis I really appreciate it

I also want to extend my gratitude to the BOD, and all employees of InterLog

Company, which I do this study in Without their co-operation and help, the data collection process of this thesis could not have been completed

Finally, I want to give my deepest appreciation to my parents Mom and dad always believe in my abilities and give me encouragement all the time They have shared my ups and downs during my ISB program This work is dedicated to them

I- EXECUTIVE SUMMARY

InterLog Company is a Logistics Company, which current situation is high employee turnover rate In 2013, turnover rate is 19.5% and in 2014 that is 26.88% In 2014, the average staff turnover rate of general industry is 12.7%, however, that of InterLog is 26.88%, higher compare with result survey of Towers Watson Vietnam And following statistics, turnover rate

of Sales Department in 2013 and 2014 in turn are 8/16 (50%) and 14/25 (56%) is highest, so I focus on analyzing turnover intention of employee of Sales Department

Based on secondary data such as annual HR report of the company in two years 2013 and

2014, and reports of exit interviews and primary data – I used qualitative method – in-depth interview 7 employees of Sales Department randomly, I find out some main causes lead to this situation is conflict, ambiguity, salary and reward system, and high pressure In the four reasons mention above, conflict and ambiguity are key causes

Ø Conflict due to inefficient internal communication

Ø Ambiguity due to inconsistent working process, unclear role of employee and

empowerment of middle manager

Between conflict and ambiguity, BOD of InterLog should solve the ambiguity first; a consistent working procedure and role clear of employees are a “solid foundation” for long-term development of the company

Basing on results of interview of some middle managers (Sales, Production and Human Resources and Finance Department) of InterLog Company, I propose two solutions for company

First alternative solution: Set up a clear process

Ø First, making quotation of popular items

Ø Second, set up process

Ø Last, define rights and responsibilities of each department

Second alternative solution: Set up clear goals

Ø First, communicate corporate goals, mission and vision for employees

Ø Second, do performance feedback

Ø Third, developing autonomy

Ø Next, setting up a clear path promotion

Ø And the last, contest a game show such as: “I want to be section director”

II- PROBLEM IDENTIFICATION

2.1 Background of InterLog Company

International Logistics Joint Stock Company (InterLog) was separated from Interlink Group – business specializing in freight forwarding multinationals In the context of

international trade development, freight demand for exports and domestic rises up in Vietnam,

to more proactive in business, International Logistic JSC was born on August 2005 with its head office based on Ho Chi Minh City

Being a business with 100% domestic capital, InterLog has powers such as:

• As an independent accounting unit

• Have full legal status

Name of Company and Head Office

Name of Company: International Logistics Joint Stock Company

Short name: Interlogistics

Head office: 5th Floor, Saigon Port Building, 03 Nguyen Tat Thanh St., W.12, Dist 4, HCMC

The Scope of Business

• Shipping and freight forwarding by truck, train, ship and aircraft (including: less than container loaded - LCL and full container loaded - FCL)

• Shipping agency

• Sales of multi-modal transport

• Customs tax

• Handling, preserving, storing and packaging of goods

Do not just focus on transportation and freight forwarding import and export goods from the port to the port, but also InterLog exploits air transport, organizes the consolidation and

storage of goods With extensive relationships, agency network of the company has been

selected to enhance the quality of service, to meet increasing demand of domestic and foreign clients

Vision and Mission

Vision: In next 5 years, InterLog has oriented to become leading supply chain innovator

not only in Vietnam but also in Indochina region specializing in service "one-stop" for clients and packages

Mission: Operating in logistics business, InterLog has developed with mission to create

the effective supply chain that brings benefits to customers, themselves and community

Achievements

Over 10-year development, it has had the own milestones include:

• 2005: Established InterLog Head Office; Achieved ISO 9001:2000

• 2006: Established InterLog-Danang Agent

• 2007: Achieved Vietnam Excellent Brand Certificate, which is organized by

Ministry of Trade and Vietnam Economic Times

• 2008: To be approved as an Official Licensed Customs Broker by Vietnam Customs

General Agency

• 2011: Established InterLog-Haiphong Agent

• 2012: Established InterLog-Hanoi Branch

• 2014: Opening Nhon Trach Depot

Beside that, InterLog also gets other achievement such as:

• As an official member of International Federation of Freight Forwarders Association (FIATA) and Vietnam Freight Forwarders Association (VIFFAS)

• As an official member of Vietnam Chamber of Commerce and Industry (VCCI)

• Get Excellent Brand Award by the Vietnam Economic Times certified in 2005

The Organizational System

With the nature of logistics business, InterLog sets up its organizational structure into particular departments that run each part of every shipment from customers The organizational system of InterLog comprises of Sales Department and Expert Bureau Department In details, Sales Division contains three specific segments of Export, Import and Domestics shipments meanwhile Expert Bureau Department gets involve in paperwork, documents, customs,

trucking and warehousing departments etc

The diagram below (Source: InterLog Company) is structure of InterLog with three main

divisions: Production, Sales and HR & Finance In the bottom of diagram has the number that

is the number of employees in each department

Number of staff

g trucking services

In charge

with customs

In charge with Import shipment from Customers

Multi Transport Operator

Interconso

l

Supply Chain Managemen

t

Sales Agents

s

In charge with LCL Consolidatio

n (NVOCC)

In charge with Domestic

s (Inland Trucking )

In charge with Import and Export documents (B/L, D/O)

In charge with customer

in Northern Vietnam

2.2 Current situation of InterLog Company

Currently, the most valuable assets of all businesses are their employees Becker

(1964) stated that the investments that a firm makes for the employees about benefits, career development, and training and development are human capital investments and can be compared to the capital investments made in property, equipment, and plant that provide a sustainable advantage in the marketplace For service sector in general and Logistics sector

in particular, employees, especially salespeople, keep more important roles, and they are considered as internal customers of firm because they are major revenue-producing and cost-generating factor in most business enterprises Consequently, the successful

management of sales-force resources is of central important in determining the success of the firm However, retention of personnel, especially key players are still a major problem that companies must face when labor market has massive staffing shift between service sectors in recent years

Although developing stably throughout 10 years with the staffs and diversified

services, InterLog still meets problems of personnel affects Specially, from the beginning

of year 2014 to 2015, they faced the biggest personnel changes ever Employee turnover rate maintained at a high level is the problem that BOD of company always thinks about because turnover is extremely costly, whether it’s involuntary, such as termination due to poor performance, or voluntary, such as resignations Following to O’Connell et al (2007), employee turnover remains one of the most persistent and frustrating problems that

organizations face And there are three main components associated with the cost of

turnover: staffing, vacancy and training which business enterprise must spend Here,

staffing is the cost of recruiting and hiring the new person to replace; vacancy is the period

of time where that person isn’t working in the company results in lost productivity and potentially lost business; and training is the cost which firm invests time, resources for training new employee

Based on annual human resource report of 2013 and 2014, we can report employee turnover rate of InterLog as follows:

Table 2.1: Employee turnover rate in 2013 -2014

(Source: HR Department - InterLog Company)

Table 2.2: Position of employee leave in 2013-2014

(Source: HR Department - InterLog Company)

Table 2.3: Turnover rate of each department in 2013-2014

(Source: HR Department - InterLog Company)

Employee turnover rate increases from 19.5% in 2013 to 26.88% in 2014 (Table 2.1) and position of employees leave (Table 2.2) also rise up are alarming for the firm Basing on

‘2014 Annual Talent and Rewards Summit’ and ‘General Industry Compensation Survey – Vietnam Key Insights for 2014’ of Towers Watson Vietnam, its survey looked at salary and

turnover rate of various industries, resulted as follows:

§ The pharmaceutical has the highest staff turnover rate at 15.9%

§ The insurance industry ranked high in turnover rate at 13.9%, followed by financial

services at 13.6%

§ The average staff turnover rate of general industry in 2014 is 12.7%

In 2014, the average staff turnover rate of general industry is 12.7%, and the highest

employee turnover rate at 15.9% of pharmaceutical, however, that of InterLog is 26.88%, higher compare with result survey of Towers Watson Vietnam And following statistics,

turnover rate of Sales Department in 2013 and 2014 in turn are 8/16 (50%) and 14/25 (56%)

is highest (Table 2.3) With this result, I focus on analyzing turnover intention of employees

of Sales Department To find out the causes that led to this situation, I have done intake meeting and interviews with some members of Sales Department as well as basing on the secondary data such as: annual HR report of the company in two years 2013 and 2014, reports of exit interviews And here are some main reasons:

Ø Conflict

Ø Ambiguity

Ø Salary and reward system

Ø High pressure

2.3 First cause: Conflict

Conflicts are unavoidable part of organizational life; it is a range of behaviors and feelings or emotional responses to behavior So, conflict is an unpleasant fact in any

organization as longer as people compete for jobs, resources, power, recognition and

security Organizational conflict can be regarded as a dispute that occurs when interests, goals or values of different individuals or groups are incompatible with each other Conflict can arise from a variety of sources, and between supervisors and subordinates, between co-workers, and between employees and customers And according to James and Graham (2008), having three sources of conflict:

Ø Personal differences: Individuals keep the different role in the organizations Their values, needs are set depending on their culture process, level of education, and experience

in each business session From that, the conflict about right, belief and fact are built up from these differences

Ø Informational deficiencies: Conflict may result from deficiencies in the

communication Misinformation and misunderstanding can the main reasons leads to the conflict in misinformation and misunderstanding among the people in the organization But this type of conflict is quite popular

Ø Incompatible roles: the complexity inherent in most organizations tends to produce conflict between members whose takes are independent but whose roles are incompatible When the roles of each staff is confused The conflict appears from this actually

In InterLog, inefficient communication is the main causes lead to conflict To

specialize and limit effects of salespeople (when they leave, they will pull some customers

of company), BOD has divided work into many parts, and each department would be

responsible for each part Although it would reduce effects of individual to firm, but it also has created internal conflicts between functional departments (such as Sales Department and Expert Bureaus Department) Conflicts have derived from the lacking of the effective

communication between employees due to different background knowledge of each

employee in each department This makes low level of performance Numerous studies have linked internal communication and the degree to which employees are informed to job satisfaction and performance (Gray & Laidlaw, 2002; Bartoo & Sias, 2004; Rosenfeld et al., 2004; Zucker, 2002) The competitive advantage of strategic internal communication comes not only from the obvious benefits of employee satisfaction and productivity, but also from the positive contributions that well-informed employees can make to a company’s external

public relations efforts Employees can be an organization’s best ambassadors or loudest critics, depending whether and how they get information (Howard, 1998) Effective internal communication can enhance corporate reputation and credibility when external stakeholders consider employees as particularly credible sources (Dawkins, 2004; Hannegan, 2004) Put simply, employees are the face of an organization and have a powerful influence on

organizational success

Ms Mong Hien – Sales Department “… I really love this job and work environment,

but I often feel tired and stress because of arguments with Expert Bureaus

Department, I feel made it difficult…”

Mr Van Tri – Sales Department “… Conflicts with Expert Bureaus Department are

invisible pressure on me Connecting and sharing information between the two

departments are not good I know, in fact each department has its own pressures, but I think provision has to support maximum for us to get more contracts…”

Ms Thanh Hoa – Experienced Salesperson “Failure to clearly define powers

between sales and provision departments difficult for me; sometimes with customer orders, following the company law I could make, but provision refused, so I have to apologize to customers, that affect relationships with customers… "

As mentioned above, the work of the salesperson in InterLog different from other logistics companies, in other companies, salesperson will be responsible for the entire work

from the stage of looking for customers, consulting, quotes, do the customs procedures, and

so on But in InterLog, the work of the salesperson is just find customers, and take care

them, rest ones such as: work quotations, deal prices with customer, the process of customs procedures, and so on will be distributed by provisions department in charge, so we can understand basically the salesperson here was cut off limbs to limit the effects when they leave For example, with the order A, salesperson, according to the law firm will get the contract, but when put through the Customs documents are refused for reasons of profit is not high, or orders do but processes very difficult, and so on and ask salesperson refuses client Or, when the salesperson quotes to customers will rely on room rates that Customs offer, the deal of purchase salesperson not grasp that all levels are required to report back to the Customs and Customs will decide whether or not Because of legal restrictions that salespeople no autonomy, as well as more flexibility in the work, not the automatic update

of recent changes to improve technical knowledge and capacity to work, because they know everything concerning customs are supported, however, this made customs department overloaded, therefore, when requesting help or to answer too many questions of salespeople customs department feel stress, leading to limitations in communication, and sharing of information for the salesperson, as well as with the work attitude frustrating, tiring

So, conflicts between two departments arise daily from inefficent communicaiton between them and ambiguity about the role of each staff

2.4 Second cause: Ambiguity

Unclear role and responsibility of employee is called role ambiguity According to

Onyemah (2008) role ambiguity is the perception that one lacks information necessary to perform a job or task, leading the perceiver to feel helpless It is an employees’ uncertainty about the expectations of different members in his or her role set Another definition, role ambiguity is viewed as the situation where an individual does not have a clear direction about the expectations of his/her role in the job or organization (Rizzo et al, 1970) It occurs when a person's tasks or authority are not clearly defined and the person becomes afraid to act on or take responsibility for anything (Jones, 2007) Numerous studies investigate for the relationships between role ambiguity and key job outcomes Role ambiguity results from inadequate information or knowledge to do a job This ambiguity may be due to inadequate training, poor communication, or the deliberate withholding or distortion of information by

a coworker or supervisor (Luthans, 1989) So, employees who feel problem to understand the job description, responsibilities, rights, powers and working procedure often dissatisfied with their job Specifically, role ambiguity is thought to impede the opportunity to improve performance and obtain rewards, thus reducing job satisfaction And for such employees, there is a high probability to leave the organization Role ambiguity can be a cause of the failure of an employee to show the productivity at workplace and can also be the failure of

an organization in the long run (Beard, 1999) Additionally, role ambiguity leads

(indirectly) to turnover because concerns about how to proceed with critical tasks lead to frustration, which enhances turnover intentions In brief, we can say that clear job

descriptions and obvious authority relationships can contribute to solving ambiguity

problems When people know all details of their position in the organization, they find it comfortable to take responsibility for their actions and to interact with others

With more 10 years experience, InterLog until now has not built a smooth working process Working process is unclear and inconsistent leads to overlap in work between departments It makes employee confused in work and feel stress

Mr Thanh Ton – Sales Department “Everything is good, except for the workflow of

the company in recent time change, that is good for the company but to cause

difficulties for the Sales Dept., such as lacking of quotes for customer makes process lasts, so customers are not happy…”

Ms Hoang Linh – Experienced Salesperson “Workflow of companies is not clear,

although the company has revised but still very ambiguous, not support for sales…”

Actually, each department has its own process that built by managers, but clearly it lacks of a consistent process for all departments

Ms Thanh Hoa – Sales Manager “Be a manager, I take the initiative to build a

common workflow for people, workflow based on many factors, such as: my

experience, current situations of department and qualifications of staff We set up a procedure in detail, from how to call for customers, meet customers, to take care customers So far, we do not have a consistent working process between department”

This has caused major difficulties for the Sales Department, as the results obtained

from interviews with sales staff, they always mention these issues, and ambiguity in the work processes also lead to conflicts between the rooms, as mentioned in above section on

conflict According to Logistic experts, a unified workflow between departments, to create rhythm in the work process, reduce costs, human, idle time between stages as well as create the ability to meet customer demands at the highest level At the same time, it will help businesses attract more customers, increase market share, cost savings, thereby increasing revenue and profit

Besides, the not clear about the responsibilities and role of employees and the unclear decentralization or lacking of decentralization due to lacking of trust on middle management are the factors create ambiguity in InterLog Company

Mr Van Tri – Sales Deputy “… Additionally, the division of powers and

responsibilities between rooms unknown is also an obstacle for both staff and

manager of Sales and Provisions Department.”

Ms Hoang Linh – Sales Deputy “…We have troubles when proposing strengthening

personnel Next, empowerment is not clear, lead to lack of persons responsible for the project when incidents occur Finally, CEO does not trust middle managers”

Following the result of interview, empowerment is also a factor that creates the

ambiguity for employees in InterLog Company, especially, for middle managers

Ms Cat Duyen – Team leader of CS with 8 years experiences said that “I admire

and appreciate the CEO, that is the reason why I have stuck with the firm in a long term (8 years), I admire his working style, management skills, professional capacities, and long-term vision, and so on, except a point that is empowerment, in InterLog,

BOD lacks of empowerment of middle managers that can only be interpreted as a lack

of confidence in the capacity of managers to work This creates the overload for BOD, and also creates a sense of apprehension for managers to express themselves in front

of the company's projects, and sometimes it also creates conflicts between the middle managers with BOD.”

Many researches about relationship between empowerment with front line employees

have been implemented Conger and Kanungo (1988) described empowerment as “ a

process of enhancing fellings of self-efficacy among organizational members through the identification of conditions that foster informal techniques of providing efficacy

information” Theoretically, Thomas and Velthouse (1990) views psychological

empowerment as intrinsic motivation manifested in four cognitions (meaning,

self-determination, competence and impact) and Spreitzer (1995) these cognitions combine additively to produce an overall feeling of empowerment and reflect an active orientation to work role – an orientation in which an individual wishes and feels able to shape his or her work role and context Several researchers have investigated the role of psychological empowerment in many positive job behaviors including proactive behaviors and

commitment (Anderson & Williams, 1996; Spreitzer et al., 1999) It is believed that the psychological state that empowerment provides, enables empowered employees to engage more in extra-role efforts, act independently and have high commitment to the organization (Spreitzer, 1995; Aviolo et al., 2004) We suggest that since employees who are empowered tend to find meaning in what they do, feel they are in control of their work, feel they have the required capacity to perform their job, are determined to perform their job roles and

believe that they can as well influence job outcomes, psychological empowerment will help employees to also become more engaged in their work And there is enough evidence that psychological empowerment is positively related to various positive job outcomes such as organizational citizenship behavior (Onyishi, 2006), organizational commitment (Manz & Sims, 1993), innovative behavior (Spreitzer, 1995; Spreitzer et al., 1999) and job

satisfaction and performance (Dickson & Lorenz, 2009; Hechanova et al., 2009; Kirkman et al., 2004; Mohd et al., 2009)

Concluded, in InterLog Company, ambiguity includes lack of consist working process, unclear role and responsibilities of employees (role ambiguity) and lack of empowerment of middle managers

2.5 Third cause: Salary, Reward System and Emotional Exhaustion

Compensation and benefits or rewards practices are the essential elements, which play

a vital part in the employee retention Lawler (1990), states that the key issue in retention is the amount of total compensation relative to levels offered by other organizations

According to him organizations that have high levels of compensation, will have lower turnover rates and larger numbers of individuals applying to work for them Furthermore, he argues, high wage workplaces may create a "culture of excellence." In InterLog, the salary, reward and commission for the functional department are average level compare with other companies in Logistics sector in Vietnam In the reality, some salespeople of InterLog leaved company to find another job with high salary Many studies have confirmed that salary level has a significantly positive effect on organizational commitment (Folger &

Konovsky, 1989), as well as on turnover intention (Ghiselli, La, & Bai, 2001; Summers & Henfrix, 1991)

Ms Bich Loan – Sales Department “This job is high pressure, I am not satisfied with

salary and reward of firm In reality, this salary is not competitive compare to other companies in this sector… Working environment is so good, people are friendly and I can learn more from everyone: managers and colleagues…”

Following to annual report of Human Resources Department, the total labor cost per employee from 2012 to 2014 is:

Table 2.4: The comparison between average salary increase and inflation rate

Figure 2.1: Salary Increase In Vietnam from 2004 – 2015

(Sources: Towers Watson - General Industry Compensation Survey – Vietnam Key

Insights for 2014)

In 2013, salary increased 16.36% compare to 2012, and in 2014 salary raised 19.49% compare to 2012 (Table 2.4) However, between 2013 and 2014, salary just increased 2.69% (Table 2.4) Compare to inflation rate in three years 2012, 2013, 2014, salary increase of InterLog just enough to compensate for the rising of inflation

In addition, working pressure factor is also one of the causes that staffs mention when were interviewed

Ms Mong Hien – Sales Department “With me, the work pressure increases day to

day, sometimes I feel exhausted However I will try to do because I like this job…”

Emotional exhaustion stems from a lack of energy and from feelings that emotional resources are being drained, often as a result of excessive chronic work demands (Maslach, 1982) And emotional exhaustion is a dimension of burnout concept Burnout has been

described as a psychological disposition composed of emotional exhaustion, low personal accomplishment, and depersonalization of others (Maslach, 1982; Maslach & Jackson, 1981) Company salespeople span the gap between a business organizational and its buyers, and have long been seen as key employees, from a market orientation perspective (Bitner, 1995) Unfortunately, these employees often suffer from high levels of stress due to

conflicts between satisfying the demands of clients and fulfilling the requirements of their own organizations (Bole et al., 1997; Miller et al., 1988) These high stress levels often lead

to employee burnout, which negatively impacts job performance, job satisfaction,

organizational commitment, and turnover intentions (Singh et al., 1994)

In spite of having complaints about salary and reward system, but it is not the first and

is the most important reason to an employee leave decision In in-depth interview with 7 employees of Sales Department, just one person mentions it like the first reason which she

is unsatisfied but when I ask more “If finding another job with high salary, you will quit job

here?” she is not sure, cause she likes working environment of InterLog That means salary

and reward system is not the most significant factor to decide quit job of employee And views of the BOD of InterLog also determined that, will not retain employees by salary, because it is a weak link Many previous studies also said that retention based on the

principle of "compensation-based commitment" (Meyer et al., 2003) is of course sensitive to changes in compensation within the company Employers that base their retention on

compensation-based commitment will always be vulnerable to the possibility that their competitors will be able to offer better wages and thus lure away their employees Smith (2001) argues that money gets employees in the door, but it does not keep them there

Money can be classified as a "satisfier," and it is a necessary but insufficient factor in

employee retention, while Harris and Brannick (1999) agree that money is not the primary motivator for employees In fact, many companies have done a very good job of retaining their employees without any pay-based retention incentives (Pfeffer & Veiga, 1999)

In closing, there are four main causes: conflict, ambiguity, salary and reward system, and high working pressure lead to high staff turnover rate in InterLog

Figure 2.2: Diagram for main causes lead to high turnover rate in InterLog

Theoretically, past studies relating to turnover intention has shown that organizational commitment and job satisfaction are regarded as two important antecedent variables that affect the turnover intention of employees (Clegg, 1983; Kars et al., 2005) In fact, the findings of empirical studies on the relationship between organizational commitment, job satisfaction and turnover intention have confirmed that the two variables have significantly negative effects on turnover intention (Bartle, Dansby, Landis, & McIntyre, 2002; Parker &

Kohlmeyer, 2005) This suggests that employees with high job satisfaction levels have a higher level of work efficiency, organizational commitment, and willingness to sacrifice for the organization, making it more difficult for them to leave their jobs So, to do this project,

I will find out antecedents of job satisfaction and job commitment, and based on those factors to limit employees leave their jobs And below is table, which lists antecedents and outcomes of job satisfaction and job commitment of previous studies

Table 2.5: List of antecedents of job satisfaction and commitment of previous researches

Turnover intention

- Coworker relationship and work environment has positive effects on job satisfaction But, job satisfaction has no significant effect on turnover intention

- Salary level impacts

to organizational commitment, but has not significantly affect turnover intention

(2012)

Leadership style Organizational culture

Organizational commitment

There are positive relationships between leadership style and organizational culture

with organizational commitment

Intention

- All factors have positive relationship with job satisfaction and organizational commitment

- Job satisfaction and organizational

commitment in this study have not relationship with turnover intention

Turnover Intention

- Burnout has significant positive impacts on turnover intentions

(2011)

Role conflict Role ambiguity

Organizational commitment

- This study assessed role ambiguity and role conflict as mediators of the relationship

between employee socialization and commitment

(2008)

Motivation Need for achievement Initiating structure Leader consideration

Turnover

- Factors motivation, need for achievement, leader consideration, job variety, task

Feedback Job variety Task identify

identity were significant antecedents

to job satisfaction

- Initiating structure and feedback have negative effect on turnover

- Job satisfaction has negative effect on turnover

Role conflict

Organizational commitment

- Role ambiguity and role conflict impact negative to

organizational commitment

- Employee empowerment, job motivating potential, leadership behavior and acceptance by co-

worker have positive effect to job

Organizational commitment

- Role conflict, role overload and role ambiguity are negatively correlated with job satisfaction and organizational

behaviors Organizational role behaviors

commitment

- Professional role behaviors impacts positively to job satisfaction and organizational commitment, but result just partially support with job satisfaction and minimally supports with organizational commitment

- Organizational role behaviors are

negatively correlated with job satisfaction and organizational commitment

• Work environment

• Job reward

• Organizational management

• Medical practicing environment

Turnover Intention

- This study indicates that several, but not all dimensions of both job satisfaction and burnout syndrome prove to be relevant factors affecting physicians’ turnover intention

Burnout syndrome

• Emotional exhaustion

Turnover Intention

- Organizational justice and Rewards have impacts to job satisfaction

- Job satisfaction explained reasons for turnover intention

Following to Table 2.5, almost factors have strong impact on job satisfaction and organizational commitment have appeared in the result collected of InterLog Company such as: compensation, emotional exhaustion, role ambiguity, role conflict, empowerment For factors: work environment, leadership style, training, organizational justice, respondents when were asked appreciated them BOD of InterLog has focused on building corporate culture, work environment and employee training, whether it is long-term goals of the

company

Ms Mong Hien: “For two years working at InterLog, I have received many things I

have learned a lot of things to help work well, especially, helping and sharing from Ms Hoa She is my team leader, also my manager department I really love this job and work environment of InterLog ”