The effect of work life conflics, working environment and compensation on employee performance im vietnamese domestic banks

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business --- Nguyen Thi Anh Ngoc THE EFFECT OF WORK-LIFE CONFLICTS, WORKING ENVIRONMENT AND COMPENSATION ON EMPLOY

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Nguyen Thi Anh Ngoc

THE EFFECT OF WORK-LIFE

CONFLICTS, WORKING ENVIRONMENT AND COMPENSATION ON EMPLOYEE PERFORMANCE IN VIETNAMESE

DOMESTIC BANKS

MASTER OF BUSINESS (Honours)

Ho Chi Minh City – Year 2014

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Nguyen Thi Anh Ngoc

THE EFFECT OF WORK-LIFE CONFLICTS, WORKING ENVIRONMENT AND COMPENSATION ON EMPLOYEE PERFORMANCE IN VIETNAMESE

DOMESTIC BANKS

ID: 21110038

MASTER OF BUSINESS (Honours)

SUPERVISOR: Dr TRAN HA MINH QUAN

Ho Chi Minh City – Year 2014

This thesis could not have been accomplished without the help, advice, support, guidance and encouragement of many people

I wish to explain my sincere gratitude to my advisor, Dr Tran Ha Minh Quan, for his kind guidance, intensive support, valuable suggestions, instructions and encouragement during the time of doing my research

I also would like to thank my dear colleagues, friends and classmates for their invaluable advice, help, support during the time I was doing this thesis

Last but not least, I would like to express my special thanks to my man and my family for their great support, assistance and encouragement for my study and thesis fulfillment

Nguyen Thi Anh Ngoc

November 2014

ABSTRACT

Vietnam, like the rest of Asia, has entered a period of slower growth Besides the manufacturing and agricultural sectors, other industry sectors are being adversely affected by the slower growth and the Banking sector is no exception Series of banks restructure itself with human resource as an important part: layoffs the ineffectives and higher employees’ performance for the remains It is clear that employees take a key figure for banks’ performance Go along with the issue, managers should control what contribute for higher employees’ performance to enhance the competitive advantages of banks

As a result, all three determinants which are work-life conflicts, working environment and compensation impact on employee performance in Vietnamese domestics banks whereas compensation has the highest impact on performance of banking staff in significantly high level Imbalance in work-life negatively impact on performance bank in turn Working environment also has positively impact on bank staff productivity but with the lowest significance

The result of the study can contribute for human resource management for enhancing productivity and performance of banking staff in the future

Key words: Employee performance (EP), work-life conflicts, working environment (WE),

compensation (COM), Vietnamese domestic banks (VDBs)

LIST OF FIGURES

Figure 1: Conceptual research model 18

Figure 2: Research process 20

LIST OF TABLES Table 1: Income of bank staffs by year 03

Table 2: Income and average profit of bankers in 2013 04

Table 3: Distribution system of banks in 2013 19

Table 4: Demographic information 21

Table 5: Measurement scale 22

Table 6: Reliability statistics of compensation variable 29

Table 7: Reliability statistics of COM variable with 5 factors 30

Table 8: Reliability of Work-life conflicts variable 31

Table 9: Reliability statistics of WLC variable with 5 factors 32

Table 10: Reliability of working environment variable 32

Table 11: Reliability of WE variable with 4 factors 33

Table 12: Reliability statistics of Employee performance variable 33

Table 13: KMO and Barlette’s test 36

Table 14: Total Variance Explained 37

Table 15: Rotated Component Matrix 38

Table 16: KMO and Barlette’s test & Total Variance Explained of second EFA 38

Table 17: KMO and Barlette’s test & Total Variance Explained 38

Table 11: Coefficient 41

Table 19: ANOVA 41

Table 20: Model Summary 42

VSBs Vietnamese Domestics Banks

HRM Human Resource Management

JSCBs Joint-Stock Commercial Banks

S&D Sales and Distributors

CONTENTS

ACKNOWLEDGEMENT i

ABSTRACT ii

LIST OF FIGURES iii

LIST OF TABLES iii

LIST OF ABBREVIATIONS iv

CHAPTER 1 1

INTRODUCTION 1

1.1 Research background 1

1.2 Research objectives and questions 4

1.3 Scope of the research 5

1.4 Conclusion 5

CHAPTER 2 7

LITERATURE REVIEW, HYPOTHESIS AND RESEARCH MODEL 7

2.1 Introduction 7

2.2 Theoretical review 7

2.2.1 Employee performance 7

2.2.2 Work-life Conflicts (WLC) or Work-life Imbalance 8

2.2.3 Working Environment 10

2.2.4 Compensation 11

2.3 Hypothesis development 13

2.3.1 Work-life conflicts and employees’ performance 13

2.3.2 Working Environment and employee performance 14

2.3.3 Compensation and employees’ performance 14

2.4 Research model 15

2.5 Conclusion 16

Chapter 3 17

METHODOLOGY 17

3.1 Introduction 17

3.2 Research design 17

3.3 Research sample size and techniques, sample discription 18

3.3.1 Sample size 19

3.3.2 Sample technique 20

3.3.3 Sample description 21

3.4 Measurement 22

3.5 Data analysis methods 24

3.5.1 Testing reliability of scales by using Cronbach’s Alpha and Coefficient 24

3.5.2 Exploratory Factor Analysis 25

3.5.3 Multiple regression analyses 26

3.6 Conclusion 27

Chapter 4 28

RESULTS 28

4.1 Brief description of subjects 28

4.3 Patterns of data for each research question 29

4.3.1 Preliminary evaluation scale with Cronbach’s Alpha 29

4.3.2 Exploratory Factor Analysis (EFA) 35

4.3.3 Regression analysis 40

4.4 Conclusion 43

Chapter 5 44

CONCLUSIONS AND IMPLICATIONS 44

5.1 Discussions 43

5.2 Managerial implications 44

5.3 Limitations and recommend for further research 47

5.4 Conclusions 47

REFERENCES 49

APPENDIX A: SURVEY QUESTIONAIRE 54

ENGLISH SCALE 61

APPENDIX B – DATA ANALYSIS RESULTS 63

Factor Analysis 63

Regression 74

CHAPTER 1 INTRODUCTION

This chapter presents the introduction to the study It contains the research background,

research problems, research objective, the significant of research and research structure 1.1 Research background

The objective of business owners is profitability Organization’s success depends on employees’ performance Poor performance is detrimental to company’s success Even employee performance can make or break an organization’s success

Banking industry has sufficiently undergone rapid changes and with the entry of foreign players and strong private players the face of industry was redefined completely Indeed, according statistics from Vietnamwork, demand for labor force of banking used to be always at the top job hunter and top most desirable jobs in the period of 2006-2007 due to its rapidly development both vertically and horizontally, however, in time of economics deficit, this became against in the later period, begun from 2011 In wake of these changes, the changes in fundamentals and structure of banking industry majorly also affected the role of internal customers - the employees of the industry Besides several other changes took place

in the industry which led to huge churning of employees in the industry thus the need for caring for the satisfaction of employees also became important

There are several antecedents of employee satisfaction found in various studies conducted in different areas of different industries and sectors The cost of employee turnover

to firms to firms has been estimated to be up to 150% of the employees remuneration package (Schlesinger &Heskett, 1991)…This number, once again, raises up a warning of improving job satisfaction for effective use of resource

There has had number of studies about determinants affect on employee performance worldwide such as Impact of Compensation, Performance Evaluation and Promotion

Practices on Government Employees Performance VS Private Employees Performance (Bilal Jamil, 2011); Contributory Factors in Employee Satisfaction: An Empirical Investigation of Banking Industry (Pareek&Vandana, 2013); Determinants of Employees Performance in Corporate Sector: Case of an Emerging Market (Mubbsher M Khan & Maryam Jabbar, 2013); Work-Life Balance Practices in the Banking Sector: Insights from Nigeria (ChimaMordi& Stella IbiyinkaOjo, 2011); The Effect of Earning, Working Environment, and Promotion Opportunities on Employees’ Performance: A Comparison between the State Sector and Other Sectors in Vietnam (Dang Xuan Chuong, 2012), etc In Vietnam, in time of slower of growth, highly-affected-by-rumor banking system, high turnover in banking labor force, low performance, the significance to consider the most influencing factors from some previous research about earning, working environment, and promotion opportunities affect employee performance becomes crucial action to enhance banks’ success

Issues for bank employees The banking industry also suffers from high employee

turnover rate One of the seven remarkable Vietnam banking issues in 2013 is the changes in both senior personnel (CEO) and higher requirements for branch directors and cut in labor force along with salary to cut operating cost from 10 to 20 percent in banks The cut in labor force issued in the form of giving high target or directly considering and cutting When the performance is not good enough to meet the target, the employees themselves, or the results from their performances lead them to be fire

In the financial report from banks, every indicators related to bankers’ income decrease in 2013 in comparison with those of the year 2012 See in table 1 below

Table 1: Income of bank staff by year

Stock code

No of employees

Total income (bil

VND)

Average income (mil

VND)

No of employees

Total income (bil VND)

Average income (mil VND) CTG 19,886 4,638 19.67 19,840 4,622 20.22

of rumors of banks’ operation created doubt in customers and staff themselves

The current economic condition seems to have exacerbated these problems

Considering the issues of low wages (compensation), high turnover and job insecurity among bank employees (workplace environment), it is not surprising to find that create work-life conflicts and low performance From the financial report in 2012, 2013, there are only banking officers of Vietinbank and Military bank create much more than they receive, the rest still show low performance or not stable performance

Table 2: Income and Average profit of bankers in 2013

Bank name  Monthly Average Income   Average Profit Created Per Person 

It appears that something more fundamental is contributing to the overall problem Reviewing the root causes of low job performance from the three key factors can provide

some understanding of the problems with bank employees along with possible solutions

1.2 Research objectives and questions

The objective of the present study is to measure how identified factors influence employees’ performance in domestic banks Consequently, the research questions of the thesis are raised as following questions:

- How do work-life conflicts, working environment, compensation affect on employees’ performance in Vietnamese domestic banks?

- Is there any relationship between 3 determinants affecting in employee performance?

1.3 Scope of the research

The research is conducted in Ho Chi Minh City with 260 respondents who work in both state-owned banks and private owned with various positions, banks

Questionnaire is about to 3-6 items for each determinant about Work-Life Conflicts, Working Environment, Compensation and Promotion Opportunities affect employees’ performance

The timeframe of research intentionally lasts in three-month period from May to the end of July in 2014 There might be changes in survey depending on how much the bank will allow them and their willingness The confidentiality of information about their answer can

be one of the biggest limitations of the study as the respondents themselves are often scared

of showing their workplace

1.4 Conclusion

This paper is organized into five sections

It begins with the introduction section This chapter one examines the issues of employee’s performance in Vietnamese domestic banks under the effect of work-life confilicts, working environment and compensation Moreover, this chapter determines the research problem as well as objective

The next section, chapter two describes related literature review concerned Vietnamese domestics banking employee’s performance in regarding of effect of three main factors and research hypotheses

In chapter 3, this third section is research design, research methodology used to empirically test the research model It also reports the process of doing the research

Chapter 4 - The forth section presents the results of data analysis Based on the results, the author of the paper aill go deep analysis of each factor that impacts on employee’s performance

The final section – chapter 5, discusses summarizes the study’s core findings and implications, its contributions and its limitations

CHAPTER 2 LITERATURE REVIEW, HYPOTHESIS AND RESEARCH MODEL 2.1 Introduction

In this chapter, theoretical background and review on previous studies are presented This chapter includes three sections The first section is theoretical review relating to critical factors and employee performance The second describes the hypothesis development for this research The last section presents Research model

2.2 Theoretical review

2.2.1 Employee performance

Measuring performance is of great importance to an in centive plan because it communicates the importance of established organizational goals “What gets measured and rewarded gets attention” (Bohlander et al, 2001)

Employee performance is measured by various factors like absenteeism, turnover, productivity and employee satisfaction (Gibson, 1990) The performance is defined as the attained outcome of actions with the skills of employees who perform in some situation (Prasetya& Kato, 2011) According to Suhartini (1995) employee performance is a mutual result of efforts, abilities and perception of tasks Good performance is the step towards achievement of organizational aims Hence more effort is required to improve the employee performance

Employee performance means employee productivity and efficiency as a result of employee growth Employee performance will impinge on the organization’s performance However the excellent working of the workforce at all levels of organization has a major influence on organization’s performance

Each employee’s productivity has an impact on organization’s goals therefore it is essential that each individual employee should be managed Performance of the employees

plays a key role for organizations Employees are the asset for the organization Organizations have learned the importance of the people in the organization in that without them the organization’s objectives could not be accomplished

2.2.2 Work-life Conflicts (WLC) or Work-life Imbalance

There is no single universally acceptable definition of work-life balance; a lot will depend on the frame of reference scholars are using The meaning of the term varies with the age, interest, value, personal circumstance and personality of each individual (Torrington, Hall and Taylor, 2009)

Work-life conflict is defined as a form of inter-role conflict in which work and family demands are mutually incompatible so that meeting demands in one domain makes it difficult

to meet demands in the other (Edwards & Rothbard, 2000; Greenhaus & Beutell 1985) This definition implies a multi-directional relationship where work can affect family and vice versa (Frone, 2002) When work and family are in conflict, obtaining rewards in one domain requires foregoing rewards in the other (Edwards and Rothbard, 2000) Work-life conflict can

be considered to have two major components: the practical aspects associated with time crunches and scheduling conflicts (i.e an employee cannot be in two different places at the same time), and the perceptual aspect of feeling overwhelmed, overloaded or stressed by the pressures of multiple roles From the previous studies, the study of Chris Higgins, Linda

Duxbury and Sean Lyons in 2008 conceptualized work-life conflict broadly to include:

 Role overload: This form of work-life conflict occurs when the total demands on time and energy associated with the prescribed activities of multiple roles are too great to perform the roles adequately or comfortably

 Work-to-family interference: This type of role conflict occurs when work demands and responsibilities make it more difficult to fulfill family-role responsibilities (e.g long hours in paid work prevent attendance at a child's sporting event, preoccupation

with the work role prevents an active enjoyment of family life, work stresses spill over into the home environment and increase conflict with the family)

 Family-to-work interference: This type of role conflict occurs when family demands and responsibilities make it more difficult to fulfill work-role responsibilities (e.g a child's illness prevents attendance at work, conflict at home makes concentration at work difficult)

 Caregiver strain: Caregiver strain is a multi-dimensional construct defined in terms of

"burdens" in the caregivers' day-to-day lives, which can be attributed to the need to provide care or assistance to someone else who needs it (Robinson,

Work-life conflict is a form of inter-related conflict in expectation between both work and family life roles (Higgins, Duxbury and Lyons, 2007) It is obvious that every organization wants to enhance the capability/productivity of output (goods/services), consequently high level performance from each employee is very important for an organization On the contrary, studies suggest that work-life conflicts create stress on the employee and cause low performance for organization It is important for an organization to gain an optimal level of performance from an employee but work-life conflicts put limitations

on such achievements

When employees fail to fulfill their family requirements from a job, work-life conflicts begin to exist (Netemeyer, Brashear-Alejandro, & Boles, 2004); however, two factors especially help to accelerate work-life conflicts First, strain-based and second, time-based conflicts Time-based conflict occurs when an individual dedicates most of the time to work and fails to encounter the family obligations Strain-based conflicts occurs when immense workload effects one mentally or puts pressure corporeally (Quick et al., 2004) The relationship between turnover intention and work-life conflict is positive When the employee intends to leave the organization it is evident that he/she is not satisfied and

does not want to remain with the company There are distinctive methods of actions and policies to reduce these conflicts (Higgins, Duxbury, & Lyons, 2007)

From the foregoing, the definition can assume social, economic and legislative forms Definition of Karatepe and Uladag (2007) is based on social issues associated with individuals ‘irrespective of marital, race or gender’ to attain an improved suit between paid work and personal life The economic perspective was described by Russell, O’Connell and McGinnity (2009); it is described as companies encouraging individuals to achieve balance as

a result of benefits they would gain such as high retention of staff, which is referred to as the

‘business case approach’ The main aim of the business case approach is that it results in a reduction in absenteeism of employees and also portrays the organization as a good employer

2.2.3 Working Environment

There are many factors in employees’ workplace environment that greatly impact their level of enthusiasm and performance The workplace’s environment affects employee confidence, output and commitment - both positively and negatively Therefore it is not just a coincidence that new incentive programs which focus on lifestyle changes, work/life balance, health and fitness issues were previously not considered as significant payback tactics, but are now common practices amongst well-reputed corporations, and primary considerations of potential employees

A widely accepted assumption is that better workplace environment motivates employees and produces better results Office environment can be described in terms of physical and behavioral components Based on Brill et al (1985), they had stated that there are a few factors of physical work environment that need to be improved The factors are such as lightings, the floor configuration, office layout and also the furniture layout In Leader Value website, behavioral components is described in eight key factors including (1)

goal-setting, (2) performance feedback, (3) role congruity, (4) defined processes, (5) workplace incentives, (6) supervisor, (7) mentoring/coaching and (8) resource availability The class of the employees’ workplace environment highly affects their level of motivation and the following performance How well they engage with the organization, especially with their workplace environment, influences to a great extent their error rate, level

of innovativeness, relationship with other employees, rate of absenteeism and, finally how long they continue to work

Compensation is systematic approach to providing monetary value to employees in exchange for work performed Compensation may achieve several purposes assisting in recruitment, job performance, and job satisfaction

Mondy and Noe (1993) has devided compensation in two types’ financial compensation and non-financial compensation Financial compensation is futher devided into direct and in-direct financial compensation Direct compensation includes bounce, good salary packages, profits and commission Indirect financial compensation are those benefits that are not covered by direct financial compensation Non-financial compensation consists of responsisbilities, opportunities, recognition promotion, vacations, work-place environement, sound policies, insurance, medical, retirement etc All these compensations effect the performances of employees in different manners

Compensation management, also known as wage and salary administration, remuneration management, or reward management, is concerned with designing and implementing total compensation package The traditional concept of wage and salary administration emphasized only on determination of wage and salary structures in organizational settings

However, over the passage of time, many more forms of compensation, entered the business field which necessitated to take wage and salary administration in competitive way with a suitable change in its nomenclature

Cascio has defined compensation as follows: "Compensation includes direct cash payments, indirect payments in the form of employee benefits and incentives to motivate employees to strive for higher levels of productivity”

Compensation processes are based on compensation philosophies and approaches which are developed and supervised to give and sustain suitable types and levels of financial compensation (Bob, 2011) Armstrong (2005) argued that compensation management is a vital part of human resource management (HRM) and it moves toward organization’s performance It leads to design and implement compensation plans that are geared to the enhancement of organization and employee’s productivity

Importance of HR practices in under-developed countries has been recognized by Anakwe (2002) There are many variables which are included in HR practices but in this research work three HR practices are included which are compensation, promotion and performance evaluation These three factors have strong relationship each others The main reason of selecting is based on fact represented by (Shahzad, Bashir, and Ramay, 2008) that

in under-developed countries physiological requirements (compensation, promotion and performance evaluation) have significant influence on employees’ performance

Compensation administration is one of the most important areas of human resource management because sound compensation policies, programs and their effective execution are essential to procure, maintain and develop the human resource of the organization to get effective result from them It involves the selection, designing, development and direction of programs designed to implement compensation or incentive policy through financial rewards

2.3 Hypothesis development

2.3.1 Work-life conflicts and employees’ performance

According to Cohen & Single (2001) there is lot of pressure on the management of the organization to prove to be a friendlier one to the employees Grover and Crooker (1995); and Scandura and Lankau (1997) have found that the employees’ sense of responsibility to organization become more progressive when flexible time scheduling is being adopted by the organization Brandt, Krawczyk&Kalinowski (2008) examined that the work-life balance relationship exhibits a negative correlation According to Ali and Baloch (1999) conflict negatively affects the personal life of employees which results in their low performance Ahmad (2008) also remarks that work and family conflict is inversely linked to employees’ performance It is also examined that work and family conflict decreases employee satisfaction, increases employees stress and decreases performance

There have been many definitions of work-life conflicts, however, in general, it relates to same main ideas In this research, the author decided to measure factor work-life conflicts based on the scale of Netemeyer, McMurrian&Boles’s, 1996 on four main constructs: work-to-family interferences, family-to-work interferences, time-based and strain-based with full ten items from the principal scale

Hypotheses H1: There is a negative impact of work-life conflicts on employee performance

2.3.2 Working Environment and employee performance

Work environment can be made pleasant by controlling the noise, pollution, temperature, lighting and improving facilities to reduce physical risks According to Yesufu (1984) in order to enhance employees’ output, a suitable work-environment is vital If the environment of organization is excessively noisy, polluted, warm and ill ventilated, the employee performance will be diminished

The conditions at working environment may be favorable or unfavorable to the employees In favorable conditions employees tend to share their pleasant experiences and express their true attitudes In this environment the negligent employees tend to transform into those who feel a sense of accountability In unfavorable conditions employees are likely

to share their unpleasant experiences and in this environment the employees with a sense of accountability or rationalism tend to change into unaccountable and irrational employees The most recognized theory is that when the working environment is suitable for employees they show better performance in the organization When employees contribute better input then their output boosts accordingly and employee productivity also enhances

Hypotheses H2: There is a positive impact of working environment on employee performance

2.3.3 Compensation and employees’ performance

Compensation is the major element that affects the employee performance If employees are satisfied that organization is offering a good compensation then their motivation is at a higher level and as a result their work performance is also better off Robbins (2001) said that when employees feel happy about their compensation they are more motivated towards their work and the performance of the company also boosts

Cameron and Pierce (1996) said that many organizations use pay, promotion and benefits to give more confidence to better performing employees Management of the

organization often anticipates this depending on the strengths and responsibilities of such employees and these expectations are different from organization to organization Teseema&Soeters (2006); and Shahzad et al (2008) have described that there is a significant relationship among employee performance and compensation practices

Providing respecful compensation to the employees ò an organisation has soothing effect of both organisation and employee performance (Jamil and Safaraz, 2011) To improve the performance, organizations are trying to improve the performance of human capital

Hypotheses H3: There is a positive impact of compensations on employee performance

2.4 Research model

1

1.1.1

Figure 1: Conceptual research model

Hypotheses H1: There is a negative impact of work-life conflicts on employee performance

Hypotheses H2: There is a positive impact of working environment on employee performance

Hypotheses H3: There is a positive impact of compensations on employee performance

2.5 Conclusion

Various researches have studied of these three factors’ impact on emplyees’ performance This chapter explores these constructs and their independent variable – employees’ performance in more details to identify shared patterns in the relationship between them The primary focus of this chapter was to present definitions of the variables, then, specific evidence of relationship between three selected dependent variables and the independent one were pointed out, also a collection from previous research Understanding these natures could be helpful in later comparison of bankers’ performance in hypothesis and actual results

Chapter 3 METHODOLOGY 3.1 Introduction

This chapter will introduce research methodology that is used to test the Research framework developed in previous session It will present research design, how to enerate surveyed questionnaires, how to survey for research data, how to access this data set to know

if it is reliable and analyze the data from pilot survey by reliability and factor analysis and how to conduct the final survey to collect the data for analysis

3.2 Research design

In this study, survey research method is adopted to examine the three determinants affect in employees’ performance and its consequences about employees’ performance According to Ary, Jacobs, Razavieh, and Sorensen (2006), survey research belongs to quantitative research

Quantitative research can be divided into two parts, descriptive and experimental research Descriptive study is one in which information is collected without changing the environment In human research, a descriptive study provides information about the naturally occurring health status, behavior, attitudes or other characteristics of a particular group Therefore, this study investigates the influence of leadership styles on employee turnover intention by means of descriptive and analytical methodology

Survey research is implemented to examine the characteristics, attitudes, behavior or opinions of specific population, according to Fraenkel and Wallen (2003); Salant and Dillman (1994) The survey method using a structured questionnaire is utilized to obtain the primary data from participants However there are disadvantages of survey research, that impact to the outcome of research Singleton and Straits (2005, p) states, “The major disadvantage of surveys relates to their use in explanatory research Beyond association

between variables, the criteria for inferring cause-and-effect relationships cannot be established as easily in surveys as in experiments.” (p 244) The research design, therefore, may pose limitations that are important to consider about interpretation of the outcome That was the reason why the specific hypotheses had been formulated and field study was conducted to investigate the relationships between compensation, working environment, work-life conflicts and employees performance

The Figure 2 showed the research process contains several key steps below In that, the research was followed that clearly, aim to assure the achievement result

Figure 2: Research process

Define Research Problem

Reliability analysis Data Analysis

Conclusions & Implications Regression analysis Research Design

Factor analysis

3.3 Research sample size and techniques, sample discription

3.3.1 Sample size

Ho Chi Minh City is the principal financial center of Vietnam with the highest focus

of banks, which accounts for about 20.13% number of bank transaction offices, ranked number one in total (see more in the table 3 below) Consequently, choosing the work force

of banks is easy for author to reach the target sample size The survey was conducted from early June to end July of 2014 The population for this study comprised in both State-owned commercial banks (STCBs) and Joint stock commercial banks (JSCBs) in Ho Chi Minh city

A total 260 questionnaires were administered to potential respondents distributing to this area

Table 3 – Distribution System of Vietnam banks 2013

the model that most researchers agree a reasonable size of sample is five samples of each

scale item: “The size of sample is at least five samples for each scale” (Bollen 1989) In

factor analysis, the sample size should be as large as possible with the minimum should be at least five times as many observations as the number of factors to be analyzed and preferably not less than 100 As there are 20 variables used for the factors analysis, the minimum sample size should be 100 (20x5)

The number 260 is also a suitable sample size for exploratory factor analysis where it sample size is larger than 100 and the sample is at least five times for each scale (Haier et al, 2006)

The sample size is determined according to technique of multiple variable analysis is that minimum sample size should be equal to n=50+8m, which m=3is number of independent variables (Tabachnick and Fidell, 1996) The number of questionnaires was 260 that was not large but enough to satisfy the conditions The sample size ratio was 13:1 (260/20), this is many times larger than the number of questions while the minimum condition is at five times (5:1) and large enough to meet the requirement of sample size for multi regression analysis (n=260>50+8m) Therefore, sample size reached the requirement

3.3.2 Sample technique

The author, working in banking industry and graduated from the university of economics Ho Chi Minh City, find not difficult in collecting survey at the number of 260 questionnaires collected due to relationships from colleagues and postgraduate friends working in banks The researcher used convenience sampling techniques where for each bank, the close colleagues/friends were conacted first and asked for forwarding to colleagues which obtained employees in differentdepartments were randomly chosen

Before doing the main survey and implementing data analysis, a pilot test was

conducted with 10 employees working in many Vietnam domestics banks including BIDV,

Vietcombank, Vietinbank, MHB, MB, Eximbank, ACB, Seabank, Ocean bank, etc The

sample description specifies the characteristics of the participant in a study The target

population was employees – staffs level and supervisor level working in not only

Sales&Distributor (S&D) but also head office of Vietnamese domestics banks in Ho Chi

Minh

3.3.3 Sample description

As indicated above, sample size of this study was 260 Demographic data was

collected in five (5) aspects and table 3 presents the summary of the results These statistics

revealed that 48.85% (127/260) of participants were male and 81.92% were 20 to 30 year

olds and 96.92% were at current bank less than 10 years 80% of responses presented the

education level of participants were as bachelor This give a similarity with the Vietnamese

context where banking staff is younger than 30 account for more than 60% of Vietnamese

bank labor force Furthermore, these days, most banks focus strongly in sales force where can

bring profit about directly to the banks, the descriptive research result also shows the same

context of the market circumstance

Table 4 – Demographic Information

No Demographic Discription Frequency Percentage

Commulative (if necessary)

Vocational school 13 5.00% 100.00%

4 Year at current bank

Less than 1 year 32 12.31% 12.31%from 1 to 3 year 86 33.08% 45.38%from 3 to 10 year 134 51.54% 96.92%upper 10 year 8 3.08% 100.00%

5 Department

Credit officer/ Sales 83 31.92% 31.92%Others 64 24.62% 56.54%TELLER/ Customer

Service 45 17.31% 73.85%Cash/ Cashier 34 13.08% 86.92%

scale for factors of the model of the study

The pilot test was made by deeply interviews with 10 employees to investigate whether there should have any modifications and interviewees understand about the concept used and the whole questionnaire or not

Finally, the respondents agreed that all three factors in the research concerning with their job performance in banking career and some suggestions, comments contributed for the improvement of the scale The main survey is as below:

Table 5: Measurement scales

for adjustment

Employee performance (Rego and Cunhan, 2008)

items from the principal scale

2 My manager believes I am an efficient worker

3 My colleagues believe I am a very productive employee

Work-life conflicts (Netemeyer, McMurrian&Boles’s, 1996)

1 The demands of my work interfere with my home and

family life

Totally agreed, eliminate 4 items from principal scale due to similar meanings

2 Things I want to do at home do not get done because of

the demands my job puts on me

3 My job produces strain that makes it difficult to fulfill

family duties

4 The demands of my family or spouse/partner interfere

with work-related activities

5 My home life interferes with my responsibilities at work

such as getting to work on time, accomplishing daily

tasks, and working overtime

6 Family-related strain interferes with my ability to

perform job- related duties

Working environment (Nguyen, 2011)

1 I recommend my organization as a good place to work Totally agreed Keep source

scale

2 In my workplace, staff is equipped and provided enough

equipment for doing their work

3 My superiors encourage and help me in doing my work

so much

4 My workplace is safety and convenience

5 Relationships between colleagues at my work place are

friendly and relaxed

Compensation (Tessema&Soeters, 2006)

1 My bank has presence of salary that reflects Totally agreed, except add

performance “My bank has” in front of

each item due to this scale was measure by self-evaluation of interviewers

2 My bank has presence of equitable external salary

3 My bank has presence of equitable internal salary

4 My bank has presence of salary that encourages better

3.5 Data analysis methods

Mean comparisons was used to determine whether there was a significant difference between the impact of those determinants on employees’ performance and different impact

on state employees and other employees

This section was important in assuring the validity and reliability of the instruments and thus controlling data generated through questionnaires and interviews

The author use the SPSS to analyzing the data and make the data analyzing

3.5.1 Testing reliability of scales by using Cronbach’s Alpha and Coefficient

This was tested the Cronbach’s Alpha of each scale of each factor as well as the beta

of the factor loading in the model According to Nunnally (1978), Peterson (1994), scale is accepted well that meet both conditions of (1) Cronbach’s Alpha coefficient is equal or larger than 0.6 and (2) Corrected Item-Total Correlation is larger than 0.3 Which variables have

correlation coefficients of variables (Corrected Item-Total Correlation) less than 0.3 is disqualified and removed from the measurement Cronbach’s Alpha coefficient is a statistical test of correlation of the questions in the scale relative to each other Significance of this method of analysis is to remove inappropriate variables and to limit junk variables in the research process and assess the reliability of the scale through the Cronbach’s Alpha

3.5.2 Exploratory Factor Analysis

After reliability test, exploratory factor analysis EFA was taken The objectives of EFA in this research aimed to reduce data of all 20 measurements items in to certain groups

of items for the next step multi variable regression analysis Also, the Exploratory Factor Analysis (EFA) method was applied to explore the inter relationship between the variables There are many indicators to implement the EFA test However, in this research, the author decided to test base on these below conditions, these are few key assumptions for EFA need to be tested:

 Factor analysis is used when the KMO (Kaiser-Meyer-Olkin) value is greater than 0.7 and it is inadequate if less than 0.5 (Nancy L, Leech, Karen C Barret, GeorgeA Morgan, 2005)

 Barlett’s test was smaller 0.05 (p<0.05) This value meets significance level this means that the variables are correlated highly enough to provide a reasonable basis for factor analysis (Leech et al, 2005)

 The KMO index was greater than 0.6 (the range from 0 to 1) and it is inadequate if less than 0.5 The KMO test tells one whether or not enough items are predicted by each factor

 Eigenvalues (a measure of explained variance) greater than 1.0, which is a common criterion for a factor to be useful When the eigenvalue is less than 1.0, this means that the factor explains less information than a single item would have explained

 Non-orthogonal rotation (promax) and principal axis factoring analysis will be

applied This means that the final factors will be represented well for the original scales As a result, we can assume that the information explained by each factor will represent well for all the measurement items belong to that factor

The transmission coefficient variables (factors loading) is less than 0.5 or the difference between the two factors less than 0.3 will be disqualified Stops Eigenvalue (representing the variance explained by each factor) greater than 1 and the total variance extracted (Cumulative% Extraction Sum of Squared loadings) greater than 50% Extract method "Principal Axis Factoring" rotation "Varimax" was used in the factor analysis scale independent variables

3.5.3 Multiple regression analyses

This is in order to test the relationship between the independent variables and dependent variable Running regression is to test the role of the important factors in assessing the relationship between work-life conflicts, working environment, and compensation and employees' performance Analysis is done by the method enter The variables included in the same time to select based on the selection criteria variables with a significance level of <0.05 The coefficients in the model used to test t how important of each independent variable impact to the dependent variable Through the Beta coefficient show in the results of regression analysis, we know the importance of each factor affecting the performance of employees

In this part of data analysis, a model proved to be good and appropriate should be processed and satisfied these five following steps: (1) testing regression coefficients with sig smaller than 0.05, (2) testing the suitability of the model if independent variables correlate with the dependent variable when satisfying the sig level is lower than 0.05, (3) collinearity diagnostics testing with VIF lower than 10, (4) Non-orthogonal rotation (promax) principal

axis factoring analysis will be applied.(5) testing of residual variance changes This means that the final factors will be represented well for the original scales As a result, we can assume that the information explained by each factor will represent well for all the measurement items belong to that factor

3.6 Conclusion

In this chapter an extensively outlined the research design, the population of the research, the procedure used to collect the data, addressed issues concerning confidentiality, the description of the measuring instruments adopted and statistical techniques (SPSS) employed to test the research hypotheses with three steps: Factors analyzing and scale reliability; Correlation analysis; Multiple regression analyses

Chapter 4 RESULTS

In chapter 3 the method research was introduced, in order to demonstrate that in chapter 4 an overview of the results obtained in the study are presented and discussed All questionnaires

as mentioned in chapter 3 after collected from participants were tested and analyzed The descriptive and inferential statistics are presented here The alpha levels of 05 and 01 were selected a priori for test of significance for correlations, while the multiple regression analysis was tested at the 05 significance level For the analysis of variance all values were tested at the 01 significance level

The purpose of this chapter is to analyze the data from survey and find out information about work-life conflicts, working environment, and compensation affect on employees performance in general by running regression, and after that the Linear Regression will be run in order to compare differences of those factors affect on employees of Vietnamese domestics banks

4.1 Brief description of subjects

As mentioned in chapter 3, in order to refine the questionnaire, a pre-tested on a small sample (n = 10) of selected employees from relations of author for establishing a high degree

of reliability and that pre-tested had a good result, was conducted The pre-test was in form of

a survey conducted only in Ho Chi Minh City in May 2014 Ten volunteers were asked to refine the survey questionnaire for factors, such as language used, logic, clarity and time to complete each questionnaire As results, some words used in Vietnamese questionnaires are changed The result of the survey showed that all interviewees expressed their fully understanding of the meanings of the scales even the concept of factors There were suggestions and comments for downsizing the items in the factors of work-life conflicts due

to similar meaning and appealing enough to get the respondents with clearer and not-too-long questionnaires

There were more than 260 questionnaires distributed due to the aim of the author to collect enough 260 acceptable questionnaires, the number in fact is approximately 300 sending by email and other social network tools in form of Googledocs and send directly Total 260 questionnaires were used to analyze that reached the requirements of the author in term of the number of questionnaires collected Participants in this survey are variety in term

of ages, educational levels, and genders in total 10banksworking in branches/ transaction offices/ head offices that could help to avoid bias In the next section, information of analyzing data for each hypothesis will be presented

4.3 Patterns of data for each research question

4.3.1 Preliminary evaluation scale with Cronbach’s Alpha

* Testing the reliability of Work-life conflicts variable

Table 6: Reliability statistics of compensation variable

Corrected Item-Total Correlation

Cronbach's Alpha if Item Deleted

Table 7: Reliability statistics of COM variable with 5 factors

Corrected Item-Total Correlation

Cronbach's Alpha if Item Deleted

The result in table 2 show that all items measuring the construct were satisfactory and the variable is accepted for the exploratory factor analysis due to corrected item-total correlations are larger than 30 as well as Cronbach’s alpha (.909) which is larger than 0.6

* Testing the reliability of Work-life conflicts variable

Table 8: Reliability of Work-life conflicts variable

Corrected Item-Total Correlation

Cronbach's Alpha if Item Deleted

of WLC1 will be as below: