Motivating employees reaseach at the north petro vietnam fertilizer and chemicals joint stock company

Aim: The study has been conducted so as to tìnd out the problems o f motivating employees in PVFCCo North based on analyzing the cuưent situation o f vvork motivation.. From the íầct tha

RESEARCH AT THE NORTH PETRO VIETNAM

FERTÍLĨZKR AND C H E M I C A L S IOỈNT ST O C K C O M P A N Y

Author: Tran Thanh Binh

S u pervisor: Prof L ars-T orsten E riksson

L o ca ì S u pervisor: P h D N guven N goe Thang

C lass: MPPM INTAKE 7

H anoi, January 2015

In completion o f this thesis, íìrst o f all I vvould like to express my sincere and deep gratitude to Prof Lars-Torsten Eriksson (Uppsala University - Swedcn) and PhD Nguyen Ngoe Thang (Vietnam National University), íor their experienced guidance and valuable suggestions throughout this thesis I would like to thank you for their support which kept me motivated throughout the writing and editing this thesis

I am also grateíul to the Board o f Directors, the colleagues at North PetroVietnam Fertilizer and Chemicals Joint Stock Company who spent their valuable time to ansvver responsibly and thoughtfully the questionaire Thcretbre, the data for the rescarch could be collected conveniently

Pinally, I would like to thank to my teachers, Goveming Board o f University

o f Economics and Business (Vietnam National University), Uppsala ưniveristy (Sweden); managers and staiTin Centre ofIntemational Training and Education, my dear triends and my tầmily vvho constantly gave me support and encouragement during the time the study vvas carried out

A B S T R A C T

1 R esearch title: Motivating Employees - Research at the North Petro Vietnam Fertilizer and Chemicals Joint Stock Company

2 Level: Final assignment for Master Program in Public Management

3 Author: Tran Thanh Binh

4 Supervisors: Prof Lars-Torsten Eriksson Dr Nguyen Ngoe Thang

5 Date when the thesis is presented: 6th Decemher2014

6 Aim: The study has been conducted so as to tìnd out the problems o f motivating employees in PVFCCo North based on analyzing the cuưent situation o f vvork motivation In this light, the study sets to recommend some solutions to improve work motivation in the company

7 M ethod: descriptive statistic from the questionaire, sccondary data írom the data source o f thc company

8 Findings and conclusions:

The study aims at investigating and then dravving conclusions :

- Theoretical basic will be studied to make clear about the importance o f motivation

- After analyzing the current situation o f work motivation in PVFCCo Norlh, I inysclt' find out some íầtors leading to thc íầct that crcating vvork motivation is inefficient here Theretbre, some solutions to stimulate employees at work are suggestcd as íbllovvs:

• The motivation to employees by tìnancial íầctors : ctTectively reform salary payment policy by applying volumc \veight in salary calculator or paying market cadrcs by perfonnance o f tasks, sales and proíìts

• The motivation to employees hy noníìncial íactores: set up an evaluation system with the Key Períormance Indicator (KPI) to make sure o f equality; đeíìne the Compctency Dictionary and Competency Model to use as the background to assess pertbrmance o f individual labor.take training soft skills o f management for mid-level leaders into consideration

9 Suggestions for futher research:

A number o f limitations can be disccmed in the studv due to the time constraints and the limited scope Firstly, the subject research is only laborer in the PVFCCo North Secondly, the solutions are still incomplete This study thcrefore can be seen as an introduction for more detailed study to bc carried in the 1'uture by myself The next research can be about building up Competency Dictionary, Competency Model as a basic to evaluate an individual employee, or develop the Key Perlbrmance Indicator to ensure the tầimess o f monthly/ annually assessment.

10 Contributions of the thesis:

The study has C onsolidated the theories on motivation The results o f the study can help PVFCCo North have a vievv o f actual situations o f work motivation and how effective the stimulating methods work They also point out problems vvhich should be concemed to change Some solutions hence are given in order to improve motivation policy and vvork as the basic for labor management

11 Keywords: motivation, períbnnance, encouraee, needs, improve

TABLE OF CONTENT

ACKNONVLEDGEMENT

A BSTR A C T

TABLE OF CONTENT

LIST OF TA BL ES

CHAPTER I: INTRODUCTION

1 R ationale

2 Aims o f the S tu d y

3 Subịects and scope o f th e S tu d y

4 Method o f the S t u d y

4.1 Overview o f document

4.2 Investigation survey

5 Structure o f the t h e s is

CHAPTER II: THEORETICAL BASE ON MOTIVATION CREATION

1 Motivation as a company p ro b le m

1.1 Fundamental d eíìn itio n s

1.2 The role o f motivation c reatio n

2 Motivating í a c t o r s

2.1 The motivation to employees by íinancial factors

2.2 The motivation to employees by non-financial íầc to rs

3 Motivation th eo ries

3.1 Abraham M aslow ’s Hierarchy o f Nccds

3.2 Two Factor Theory o f Prederick H e rz b c rg

3.3 McClelland's Human Motivation Theory

3.4 Equity Theory o f Stacy A d a m s

3.5 Expectancy Theory o f Victor Vroom

4 Literature review on motivation .

CHAPTER III: M ETHO D O LO GY

1 The basis o f research questions panel

2 Research questions construction

2.1 Questionnaire and process o f information collection

2.2 Designing research questions

2.3 S am p lin g

2.4 Methodological issues

CHAPTER IV: RESULTS AND DISSCUSSÍONS

1 The overviexv o f PVFCCo N o rth

1.1 The process o f fonnation & development and the business períbrmance

1

2

4 6 7

, 7 8

8

8

8

8

9

.10

10

10

11

11

11

15

19 19 21

22

23 23 24 26 26 27 27 27 29 29 30 30 30

1.3 The utilization oí'resources 34

2 The current situation o f motivation implemcntation at PVFCCo N o r l h 37

2.1 The analysis o f current situation o f motivation implementation 37

2.2 Inherent p ro b le m s 46

CHAPTER V: CONCLUSIONS AND RECOM ENDATIONS 48

1 Solutions 48

1.1 Solutions on motivation promotion by íìnancial íầc to rs 48

1.2 Solutions on motivation promotion by the non-financial 49

2 Recom m endations 50

3 C o n c lu sio n 51

REFERENCES 52

APPENDIX 54

LIST O F T A B L E S Number

tables

4.2 Structure ot labor in departments on 01/09/2014 34

4.6 Results of descriptive statistics for employees’ satisfaction about

4.9 Results of descriptive statistics f'or employees’ satisfaction about

4.10 Results of descriptive statistics for employees' satisfaction about

diagrams

drawings

4.1 Average income of laborers over the past years 32

4.3 The wishes of the employees in PVKCCo North in the future 47

CHAPTER I: INTRODUCTION

1 R ation ale

A great number o f people feel confuscd when fmding thc way to exploit their potentials themselves though each laborers has their own certain intcrnal resources Humans always have the physcal and mental needs to be satisíìed When laborers’ needs are met.thev wil be encouraged to work harder and harder If no motivation is present in an employee, it is difficult for them to attain labor eoals because at that time the assigned work will be completed without any creativity and effort As a result, the work will be considered as a duty to pertorm under the labor contract Organization is a group o f laborers in which they vvork tovvards common goals The goals are promoting the organization development and creating its position in the market Vice versa, in order that laborers vvill receive both íìnancial and non-íìnancial revvards from the organization, the managers need to create incentives to promote creativity and job performance o f employees Managers, therefore, must thoroughly understand the management philosophy, especially the desire and psychology o f laborers in their organization for the maximum utilization

o f each laborer's value When each employee become the "boss" o f his own working process, it mcans that thcy are allovved room to work, fínd the joy, realize their responsibilities and eíTorts to be more productive This will enablc hoth parties

to get committed towards the fulfilment o f each other’s needs

The problem o f how to motivate laborers is increasingly bcing more interested

in the current enterprises In reality, employees in North PetroVietnam Fertilizer and Chemicals Joint Stock Company have been being motivated though the results are not satisíìed as đesired and vvorkers have not perfonned at their best A very hi^h yield does not reílect the true ability o f workers

From the íầct that I selected the thesis subject: Motivating employees - Research at the North PetroVietnam Fertilizer and Chemicals Joint Stock Company (PVFCCo North) with ambition to offer an insightful understanding o f

thc cuưent situation o f work motivation in the company and propose some solutions

to rnotivate laborers contributing to the sustainable and eíTective development o f the cornpany

- Research Qucstions:

The Study will be conducted to answer the following questions:

+ What are the current situations o f work motivation in PVFCCo North?

+ What are the solutions to enhance work motivation for laborers in PVFCCo North?

2 A im s o f the Study

The aim o fth is thesis is to summarize the current research fìndings about work motivation, to analyze the work motivation at PVFCCo North and to propose activities that can improve the motivation in this company

3 Su bjects and scope o f the Study

- Subịects o f the Study: the theoretical issues, practices related to motivation creation for laborers

- Scope o f the Study:

+ About content: The content is mainly related to the motivation creation for

laborers in the organization

+ About time: This study started from June 2014.

+ Abouí space: Suhịect focused on researching and proposing solutions in

ordcr to create vvork motivation for laborers in PVPCCo North

4 M ethod o f the Study

4.1 Overview of document

Analyze and synthesize the documents related to creating vvorkplace motivation:

- The role o f the human resource management in organizations

- Theoretical Foundations about creating work motivation for laborers working

in the organization

- The tools to create motivation for laborers at vvork novv

4.2 Investigation survey

Base to build questionnaire to research vvork motivation in PVFCCo North:

- The theoretical base on motivation for laborers at vvork in the organization, and many domestic and overseas researches about job satisfaction as well as tìnding about the elements to promote the workplace motivation for laborers

- Theory o f Herzberg and research model o f Smith (1969), vvith the reterence

o f the expcrts in this íìeld

The motivational í'or laborers working in PVFCCo Nơrth depends on the following íầctors:

The construction o f the questionaire is based on the above five components,

as vvell as the measurement criteria o f each component

5 Structure o f the thesis

The thcsis consists o f five chapters, speciíìcally:

- CHAPTER I: INTRODUCTION

- CHAPTER II: THEOREOTICAL BASE ON MOTIVATION CREATION

- CHAPTER III: METHODOLOGY

- CHAPTER IV: RESULTS AND DISSCUSSIONS

- CHAPTER V: CONCLUSIONS AND RECOMMENDATIONS

b Incentỉves

ỉn terms o f economics:

An incentive is the subịective goal o f human activities in order to meet the demands set forth The incentive reílects the wants, the needs o f people and the reasons for the actions Human needs are diverse, including the outstanding needs in

a certain time The incentive is the strongest demand o f human at a certain time and this have povver over determining humarvs behaviors [1]

c Promotion:

Promotion is the psychological process which occurs due to the purposed and oriented impact o f the human in term o f corporate govemance, the promotion is the targeted impact o f the enterprise to encourage the employees to improve the achicvements and help them fulfil the missions effectively [2]

encourage thcm to improve their achievements and help thcm íulíìll their jobs eíTectively [2]

1.2 The role of motivation creatỉon

Nowadays, the world has changed in all aspects: economy, politics, especially

in the íìeld o f scientiíìc development Thanks to the explosion o f infoimation tcchnology Science togethcr with the technical initiatives, a large numher o f the modem facilities have been successíully lầbricated to use in production process The human beings thereíbre has taken a new step forward Even though machines are essential needs, human is still a key factor to control these machines Accordingly,if the needs o f the people change, the machinery and equipment has no meaning anymore Thus, when people join in any organization, except for satisíaction o f the demand to work and the demand to serve for the society, they also have many different needs and purposes Unless they can carry out any đemand

or essential purpose, they may leave the organization to be seIf-employed without the impact o f the organization However, if these needs and aspirations are resolved satisfactorily, they will strive to keep their achievements and devote all their energy and enthusiasm for the organization

Motivation creation plays an important and meaningíul role in the success or íailure o f an cnterprise An organization or a company, vvith its strengths in all aspects, but not paying attention to the íĩeld o f motivation creation, cannot fully exploit its human resources, leading to the ineíĩective quality and diff1culties in competition with other companies in the market Consequently, if the organization wants to succeed, it is necessary for it to focus on creating work motivation to the employees Ị3]

2 M otivating factors [4]

2.1 The motivation to employees by íìnancial ĩactors

The motivation to employees by íìnancial factors means using the salary, bonus, welfare to improve the vvorking achievements o f the employees The salary, bonus, welfare is basically understood as: basic salary, bonus, allowances and welfare, etc These are the crucial factors o f human, used to vvhich enable them to aíYord adequate living conditions Hence, salary, bonus and welfare are used as levers to stimulate the positivity o f the employees

The encouragement to the employees must be implemented at íìrst by thc reasonable salary, follows the building oí' the policics and regimes to ensure thc rights and obligations o f the employees In addition, the mechanism o f revvard and punishment must be clear.

The mechanism o f reward and punishment is olìten the material because it is thc clearest and most attracting motivation that the enterprise can bring abont the employees

However, the usage o f salary, bonus and welfare need to be implemented transparently and clearly, if not, it shall cause the dispute betvveen the employees and the managers, or within employees and shall cause the unexpected impacts

a The motivation to employees by salary:

Conventionally, the employees vvork so as to gain salary; however, how to pay salary to create vvork motivation to the employees is a dilĩicult issue for the employers

As vve know, although salary is actually not a motivator, when the salary is paid equally and it ensures the increment o f the re-production the employees will feel satisíied and thus, the productivity shall be higher Researches o f the psychologists about the speciiìcation o f the demand o f salary to the employees have shovvn that the employees arc only satisíĩcd with the salary whcn it meets the demands:

- Salary must reílect clearly the quantity and quality o f work, reflect the dedication o f employees for husinesses, and highlights the role o f employees in the organization Meanwhile, the salary stimulates the employees to try their best for the organization

- Salary must ensure simple reproduction o f working capacity It means that the wages must ensure basic expcndilure o f the employees Whcn the employees work, they vvould like to generate incomes to support themselves and their íamilies; therefore, if the cnterprise ensures their life, they will be assured o f working for a long term for the enterprise

- Salary payment must be based on the labour targets set íbrth, it reílects the quantity and quality o f labour that the cmployees contribute to the enterprise The labour targets are also used to compare the value o f each employee to the others Theretbre, salary becomes the labor motivation when the labour targets create the balance for the employees

- Salary payment must be based on thc technical aspcct o f salary and dedication

to the enterprise o f the employees The technical aspcct o f salary shows qualification that cmployees has achicved, and the dedication to the enterprise represents the number

o f protessional experience years, number o f seniority ycars in the enterprise If these two things arc well done, this will encourage employees to maintain high levels o f eíTorts for their advancement

- Allowance: Allowance is an amount paid to the etnployees by the employers hecause Ihey completed the tasks successful or they have to vvork in the toxic environment There are a lot o f types o f allowance such as: seniority allowance, responsibility allowance, transport allowance, toxic and danger allowance, etc Each type o f allowance shall be applied to different positions, but they all bring about the economic benefits for the employees

The allovvance improves the incomes o f the employees, make the employees feel that they are concemed and exactly evaluated vvith the tasks that they are in charge of Moreover, it creates the equality among the employees, between people vvho works in the toxic environment and the ones who vvork in non-toxic environinent, between people vvho completed the task and the ones who did not complete the tasks, etc

b The motivation to employees by bonus:

Bonus is a form o f financial incentives paid once (usually at the end o f the month, quarter or year) to pay for thc ability to perĩorm the work o f the employees However, the bonus may also be paid extraordinarily to recognize the achievements

o f the employees as early completion o f the prọịect set forlh Bonus typically includes:

- Bonus for the employees who outstandingly complete the tasks (exceeding the regulated quantity and quality o f the products)

- Bonus for saving raw materials, and labor cost

- Bonus for the employees’ creativities

- Bonus for speciíic services such as commissions over the sales, the increment in the progressivity unit, bonus according to salary, etc

Bonus is a very eíĩective tool to motivate laborers to be more productive and tie them in the responsibility to the organization Bonus payment depends on regulations

o f cach enterprise Bonus can be directly agreed bctwecn tvvo parties ot' the labour contract In addition to creating a part of the employees’ incomes, bonus creates vvork motivation for them However; the bonus only has thc value to stimulate thc employees vvhen it satisíìes the following requirements:

- Bonus has to attach directly with the individual contributions o f the employees The employees are just really excited when they reach the achievements at work, then the bonus is a great encouragement for them Thereíore; only those vvho achieve the expectations at vvork can receive the bonus to avoid the spread award, causirm the inequity in the organization

- Bonus for employees must adhere to the speciíĩc criteria and should be classiíìed clearly with the markedly different gap to compare among the employees

at the same positions but with the đifferent levels o f reward, from that, it can create engine for the einployees to emulate together

- Bonus must have the certain value and consumption meaning to the employees

to create the certain stimulation The value o f the bonus sometimes depends on the value o f differcnt factors in the goods market in different period Furthermore, the level o f bonus is also valuable at nurturing the hope in using it If the bonus is not set high enouh, the employees have no idea to use it; thereíore, it cannot create the psychological stimulation to thc employees, leading to thc problem that the employees do not try to complete their job in the next tasks

c The motivation to eniployees by welfare and services:

Welfầre is the remuneration indirectly paid in íbrm o f íìnancial aid for the life

of the employees The services for the employees such as: sales off Service, credit association Service, buying the shares o f the company, education and training aid,

Welfare for the employees includes the non-statutory welfare and statutory welfare The non-statutory ones includes vacation, resort, difficulties allowance, and incentives in holidays, Tet, etc The statutory ones are regulated by the State such as sickness, matemity, leave vvith permission and leave for personal issues, etc

These arc thc indispensable tools to keep employees’ motivation levels high because it plays an important part in iníluencing to the vvorking spirit o f the

employees and attaching with the purposes and targcts o f the employees Labor

\velfare is etTective when it meets the íbllovving requircments:

- The social welfarc is stable according to the certain period and associated with the result o f business and production activities o f the enterprises

- The social welfare must go with the certain binding conditions between the employees and their employers

- The social welfare which is meaningíul to the life o f the employees can stimulate them to work hard

2.2 The motivation to employees by non-fínancial factors

The non-financial factors are the factors that belong to the psychology o f the pcople and cannot be quantiíìed such as: ensuring enough jobs for every people; evaluating exactly the achievements o f the employees; ensuring the equality in re\vards or punishments at the right time and right place, vvell organizing the emulation movenients, culture, sports and arts, etc Creating the motivation for the employees in term o f spirit means taking the spirital advantages to improve the positiveness o f the ernployees

To create motivation for the employees by non-financial factors, the enterprise needs to well implement the following tips:

a VVorking time and rest time:

Intellectual labour or physical labour, to a ccrtain level, then tired Working and resting suitably will help to balance two processes: inhibition and excitemcnt The employees’ tension can be relievcd by giving them the proper time to unwind and get back to a good State o f mind for the next pcriod The daily or weekly working schedule must be regulated clearly from the signing date o f the labour contract When there is any changes, cmployees must be informed in advance so that they can arrange their time and shorten the working time and overcome the nature o f a heavy and hazardous job This increases the motivation to the employees

b NVorking environment:

- Working condiíions:

To vvell complete the job, in addition to the vvorking spirit, thc employees need to

bc equipped with tools, supplies, equipment, material base and vehicles The more working conditions are equipped, the more labour productivity incrcases

- Relationship with leaders and colleagues:

When the salary meets the daily basic needs, pcople alvvays require for other spiritual needs They are the relationships vvith colleagues and managers

In any organization, the nature o f the relationship depends on the scale and structure o f that organization If the scale is small, the relationship among the members is relatively simple, but if the scale is large, the relationship becomes more complicated

Characteristic o f human relationships is the communication activity, including the activity among the seniors at all levels and employees deriving from the relationship o f managers and staff, and among offícials deriving from relationships among employees The more active and regular the activities are, the closer relation

in the company is A large number o f employees after a period o f time work in large companies vvhere colleagues are less interested each other because o f overcrovvding, novv prefer working in small companies where people can talk share ideas and discuss concems

The relation activities betvveen leaders and staíT, staff and staíT have the influence on the effectivcness o f the work A strong employers and employees relationship can send the message that the organization concems, helps, supports and treats íairly with all staff and cadres o f the organization Strong employment relations can creat a plesant vvorking environment That urges employees to exchange the iníbrmation and support each other to help them successíìilly complete the tasks

- Organizational culture:

Organizational culture is an extremely important factor in creating work motivation to the employees Organizational culture is the conceptions o f value o f the organization represented by the motto, policies, principles and modes o f the organization On the other hand, organizationa! culture is full ofcultural values built during thc existence and growth process o f the organization These values become the conceptions, habits and tradition rooting into the activities o f that organization

and dominate thc feelings, vvays o f thinking and behaviors o f the organization members in thc pursuit and implementation o f the purposes, as well as the sustainable đevelopment o f the organization.

The construction o f the contents and style o f organizational culture needs to concem to the local factors, sectors, development periods, qualities o f cadres and staíT, etc The organizational culture must be accepted bỵ all cadres staff and considered as the general assets o f the organization

Organizational culture is the base o f all policies and specific methods in the production and business o f the organization, dominating the business results oí' the organization Therefore, it can be said that the success or íầilure o f the organization

is associated with whether or not the organizational culture with it right meaning

c Evaluation of the work períbrmance

Evaluation oí the work períbrmance is one o f the signiílcant activities o f human resources administration in every organization Through the evaluation o f result períbrmance, the govemors can make personnel decisions such as training, salary increment, promotion, and discipline to the employees Besides, the degree o f rationality and correctness o f the evaluation system and teedback from evaluation results to employees has the prominent impact on the moral construction and development, employees’ attitudc and psychological - social ambience in thc organization The appropriate evaluation system will enhance thc employees’ pertormance, urge them to work diligently and generate greater success

To promote the motivation to the employees, the cvaluation system needs to ensure the following criteria:

- Suitability: The evaluation system must be suitable to the govcmance goals,

serve for the govemance goals and the evaluation criteria must be suitable to each

o f the evaluation object

- Susceptibility: The evaluation system must have the measurcment tools vvith

the ability o f distinguishing whether or not the employees fulfil the tasks

- Reliability: The evaluation system must ensure that all the independent

results o f the evaluation o f all employees must be basically uniíìed

- Acceptance: The evaluation system must be accepted and supported by the

TRUNG TẦM THÒNG TIN THƯ v»ịf N

- Practicality: In ordcr to implement in the real situation, thc tools o f

evaluation must bc simple, easy to understand and use for the employcrs and the employees

d The Motivation by policies of training and development, improving the proíessional quality:

In the labour process, people are alvvays exposed to the knovvledge o f the society, and machines, and the knovvledge oí' these tools does not stop growing Therefore, if the employees are not trained and tostered to develop, they vvill becoine obsolete and outdated Thus, to enrich the understanding for the employees and to create excitement in the labor process, the training and development are necessary issues

Training is a progress aiming at providing the employees with intbrmation,

skills and understanding about the \vork organization in the company as vvell as the targets The training is designed to help and support the employees to continue contributing to the organization Training is the leaming progress to help the employees implement their functions and tasks more ellectively

Training meets the demand o f the employees It is one o f the íầctors to promote vvork motivation Training helps the employees carry out their tasks bettcr,

improve thcir capacity and reduce the monitor and the accident, etc

The enterprises need to have the plan to train and íoster their employees about

the culture, professional skills and apply the suitable forms so that all the laborers

can meet all the necessary demands

In fact, training an employee takes a lot o f time and cost o f the enterprise The

training expense o f enterprises is accounted into the business and production

expense, hence; it affects the beneíìts o f the enterprise Meanwhile, the enterprises

alvvays face to the difficulties in calculating and quantiíying the benetìts brought by

the training program The enterprises still vvorry that they will lose their staff afìer

training However, improving the effectiveness o f training is a long-term effective

investment o f the enterprise Therefore, the users nced to develop a common

strategy for training and take necessary measures to retain the employees alìter

training

3 M otivation theories

The initial trends o f Science research on creating work motivation appeared in

1930 in both educational psychology researches and popular psychology researches According to B Weiner (1990), vvork motivation theories completed and developed through 3 different periods from 1930 to 1990:

- Period o f Mechanism: 1930-1960

- Period o f the development o f the awareness: 1960-1970

- Research on the modem motivation: 1970-1990

Up to now, there are a lot o f researches which apply the theory with the main trend is to detect the promotion engine o f the employees and create the working motivation And through many different stages, there are different ways o f accessing to the motivation Hovvever, the modem way to be used popularly in course books and research books on engine and motivalion is based on the theories about creating the working motivation The theories with the greatest intluence are classitled as follows:

- Tool theory: the revvards and punishments are the tools to make the

employees implement the expected actions

- Content theory: focusing on the content o f thc motivation This theory said

that the vvorking motivation is the implementation o f bchavior to satisfy the needs and identiíy the main needs aíTecting to the bchavior The hicrarchy o fneeds is introduced by Moslow (1954), and in the model o f Two-Factor

Theory o f Herzberg (1957) has listed necds regarding the satisíỳing íầctors

- Process theory: focus on the psychological process affecting vvorking

motivation, involving expectancy theory (Vroom, 1964), Goal setting theory

(Latham and Locke, 1979) perceptions o f tầimess (Adams, 1965)

3.1 Abraham M aslow’s Hierarchy of Needs [1][3]

Abraham Maslow’s hierarchy o f needs shows that people are promoted by a lot o f different demands and these human needs can be classiíìed into five catcgories These categories can be arranged in hierarchy o f importance:

- Physiological needs: These are the most basic needs o f human beings, including: food, water, air, etc In an organization, this problem is reílected through

the satisíaction o f temperature, air o f the working place and thc salary to maintain the life o f the employee.

- Safety needs: these are the needs to be free from the threat o f physical and cmotional harm, violence and to live in an order society In an organization, these needs are reAected through the safety in the work, assets and the career, etc

- Belongingness and love needs: these are the needs to be recognized by

others in the society, to have ữiends and join in the action groups and to be loved

In an organization, these needs are expressed the desire to be in good relationship vvith the colleagues and the members o f the administrative board

- Esteem needs: these are the demands to have the good image, the admittance and hieh appreciation from the others In an organization, the people who have this need alvvays effort to have the admittance, the higher position and the admittance for their contribution to the organization

- Self-actualization needs: these are the highest needs o f people This need is towards to unleashing the latent potential o f an individual, from then, they vvill practice and become more pertect The needs o f self-improvement can be used in the organization by providing the employees with a lot o f development opportunities by frecdom in creation and the challenges in work

According to Douglas G.Mook (1995), Maslow’s hierarchy o f needs has thrcc important implications:

- The higher the position in the diagram is, the more complicated the need o f the peoplc is; and these needs is the nature o f the people

- The needs arrange in thc order, vvhen a need is satisfied, thc next need shall appear However, if a need in any level is not satisíìed, that need still exist and thc higher need vvill not appear

- The failure in the meeting the needs creates the disease Punctional neurological disorder is a desperate attempt to meet unmet needs

According to author Micheal Amstrong (2007), Maslow’s hierarchy o f needs also exists some shortcomings: No reliability in the períbrmance o f experimental studies; not sure about the clarity o f the results obtained because the different people have the diíTerent priorities and it is difficult to accept that the development

o f human needs is ascending to the hierarchy

Figure 2.1 M aslow ’s Hierarchy ofN eeds

3.2 T\vo Factor Theory of Frederick Herzberg [3]

Frederick Herzberg has developed a theory o f creatine motivation is the two- tactor theory This theory based on the sentiment that creating motivation is the result o f many factors, o f vvhich, these íactors create the satisíầction and dissatistầction Each tầctor itselí'includes both ahovc sides depending on how it is implemented, met to speciíy its nature This theory is divided into two íaetors to create thc motivation:

a Hygiene Factors:

Related to the dissatisfaction o f the cmployees about their work such as: working conditions, salary, the regimes o f the company, and relationship among individuals When the motivational factors are met, the employees becomes motivated In contrast, if the hygicne factors are good, it only means that thc dissatistầction is removed, but not itselt' bring the satisíaction or the etTort in vvork for people

b Motivator Factors:

Factors relatcd to the higher needs including: achievement, recognition, responsibility and advancement opportunities F.Herzberg believes that the employees vvork normally vvhen motivators are abscnt but vvhcn motivator factors are present, the employees are more active and satisíled

The application o f two-factor theory in vvork is the tvvo-stage process Pirstly, the management is tasked to minimize the situations vvhich can cause dissatistầction for cmployees Alter the dissatislầction State no longer exists, the tactors creating ihc satislaction should hc considered

Thus, the hygienc factors and the motivator factors show thc difference to the motivation o f the employees The hygiene factors are only in the dcmotivate area Even though they are improved, they cannot create the motivation and the satisfaction The motivator factors must be set out before the employees implement their vvork.

According to author Micheal Amstrons, (2006), the two-factor theory o f

Ỉ Ierzberg still has two typical weaknesses:

- Herzberg made conclusions from a study limited to engineers and accountants The engineers, accountants or other careers may be the challenging work Meanwhile the unskilled workers are motivated by salary and other íinancial benefíts

- Herzberg's theory did not specily the relation betvveen motivatiors and satisfaction o f employees He only íbcused on the study o f the tầctors that makes employees feel good or uncomfortable

3.3 McClelland's Human Motivation Theory [3]

According to McClelland, there are three basic motivation needs:

- Needs for power: People with high needs for power would like to control and inỉluence others These people always to pursue the leadership position They are persuasive, straightforward, practical or demanding, they like teaching and public speaking

- Needs for affiliation: The people who have this need often find happiness when they feel loved and want to avoid pain when they are scparated from a social group They always try to maintain the comtbrtable social relation They want to have the close and sympathetic íeeling, willingness to help others when these people have difficulties and vvant to have intiinate relation vvith others

- Needs for achievement: They have a strong desire to set and accomplish challenging goals They are afraid o f failure as well They vvant to take risks, take responsibilities on the tasks that they are in charge o f and self-control the task The people with high achievement alvvays vvant to reccicvc the feedback immediately on their progress because they feel satisíìed vvhen they well complete the tasks The feedback provides them vvith the stimulation to improve their performance or set the higher goals

3.4 Equity Theory o f Stacy Adams [3]

Equity Theory focuses on the teeling o f people about how they are trcated in comparison with others The belieí in equity theory is that people are encourage to seek for the social equity in revvards that they bring to their job People value fair treatment if they receive the incentives as others at the same level o f the contribution

According to Robert Kreiner and Angelo Kinicki (2004), the most general methods to reduce the untầimess:

- Changing the contribution in work (input): The employees can choose the increment or reduction o f the contribution to the organization

- Changing the results (output): The employees can change the outcomes that they receive

- Changing the feeling: People can feel an increase in their position related to work or the reduction o f the value o f the others revvards to aim at bringing the equity in íeeling

- Resigning: The implication o f the equity theory is to let the managers understand that their staff can self-evaluate the equity in their revvards in comparing

to the others' revvards The salary increment or advancement shall have no effect if

it makes the cmployees feel unfair

3.5 Expectancy Theory of Victor Vroom [3]

Expectancy Theory considers that working motivation depcnds on expectation

o f individuals on their capacity o f implementing tasks and on receipt o f desirable rewards Expectancy Theory not only pays attention to identiíy types o f demand but also study process for reward receipt o f individuals

Figure 2.2 Main elemertís o f Expectancy Theory

Expectancy Theory bases on thc correlation betwcen individual efforts, the perfonnance o f individuals and the desirablc rewards Elements o f the Expectancy Theory:

- Expectancy E -> P: O ne’s eíTorts at work will result in desired perfonnance

In order for this expcctation to achieve it peak, individuals must have their own ability and experience, necessary tools, machinery and the opportunity o f performing

- Instrumentality p -> O: Successíul perfonnance will lead to the desirable outcomes If Instrumentality p -> o is high, individuals will feel more motivated

- Valence (V): Valence is the output value or the attractiveness o f outcomes for each individual I f outcomes is available on the great efforts, good work pcrformance vvithout being respccted, motivation will be lovver Similarly, if the outcomes is highly appreciated, the motivation will be stronger

According to Robert Kreitner & Angelo Kinicki (2004), basic expectancy frainework has given three conditions that need meeting in order for motivating behaviors to occur

- Effort expectation leads to pertormance must be higher than zero It means that staffs have to reasonably expect that effort vvill create high períormance

- Períbnnance expectation leads to outcomes must be higher than zero Thereíbre, people should believe that performance will resuit valuable outcomes

- Total valuc o f potential outcomes relating to people should be positive.

Hcnce, responsihilities o f leaders are to help their subordinates satisíy theirdemands and at the same time achieve goals o f the organization Leaders must fínd the compatibility among skills, abilities, and needs o f the individuals, determine the available output from the organization and ensure that each individual has ability and necessary support to achieve the outcomes

4 L iteratu re revievv on m o tiv a tio n [10,13]

Theories o f motivation can be divided to explain the behavior and attitude o f employees (Rovvley, 1996; Weaver, 1998) These include content theories, based on the assumption that people have individual needs which motivate their actions, and theorists such as Maslow (1954), McClelland (1961), Herzberg (1966) and Alderfer (1969) are renowned for their vvorks in this íìeld In contrast to content theories, process thcories identiíìed relations among variables vvhich make up motivation and

involve works from Hcider (1958), Vroom (1964), Adams (1965), Locke (1976), and Lavvler (1973).

In a complex and dynamic environmcnt, leader o f the organization used to create the environment in vvhich employee feel trusted and are empovveređ to take decisions in the organization vvhich leads to cnhance motivation level o f employee and ultimately organizational performance are enhanced Smith and Rupp (2003) stated that pertbrmance is a role o f individual motivation; organizational strategy, and structure and resistance to change, is an empirical role relating motivation in the organization

Likewise, Luthans and Staịkovic (1999) concluded that advancement o f human resources through revvards, monetary incentives, and organizational behavior modiíìcation has generated a large volume o f debate in the human resource and sales performance field

Aguinis et al (2013) stated that monetary rewards can be a very powerful determinant o f employee motivation and achievement vvhich, in turn, can advance

to important retums in terms o f firmlevel períbrmance Garg and Rastogi (2006) identiíĩed the key issues o f ịob design research and practice to motivate employees’ perlbrmance and concludcd that a dynamic managerial leaming framework is rcquired to enhance employees' performance to meet global challenges Vuori and Okkonen (2012) stated that motivation helps to share knowledge through an intra- organizational social media platíbrm which can help the organization to reach its goals and obịectives Den and Verburg (2004) found the impact o f high performing work systems, also called human resource practices, on pcrceptual measures o f firm períonnance Ashmos and Duchon (2000) recognizes that employees have both a mind and a spirit and seek to tìnd meaning and purpose in their work, and an aspiration to be part o f a community, hence making thcir jobs worthwhile and motivating them to do at a high level with a vievv to personal and social development

C H A P T E R III: M E T H O D O L O G Y

1 T h e basis o f rese a rc h q u e s tio n s panel

- The study is based on the theoretical basis o f creating motivation for employees vvorking in the organization, and the researches on jo b satisfaction as vvell as studies on the factors promoting working motivation for employee

- l'o obtain basis for working motivation creating solutions, this study combines theory o f Herzberg and research model o f Smith (1969), with the reference o f the experts in this field

The two- factor theory o f Herzberg as mentioned in Chapter II states that there are 2 íầctors that cause jo b satisfaction as follows:

Hygiene Factors: Related to the dissatisfaction o f the employees about their

\vork such as: working conditions, salary, the regimes o f the company, and relationship among individuals

M otivator Factors: Factors related to the higher needs including: achievement,

recognition, responsibility and advancement opportunities

According to Smith et al (1969), levels o f an em ployee’s jo b satisfaction depend on factors:the work itself, supervision, coworkers, pay, training and promoting opportunities The Job Descriptive Index (JDI) o f Smith is a 72-item instrumcnt designed to measure tìve above dimensions o f job satisfaction The validity and reliability o f JDI are appreciated in reality and theory (Mayer and ctg, 1995) with over 50% researches were published using JDI The disadvantage is JDI does not sum across the factors (Spector, 1997)

In Vietnam, Tran Kim Dung (2005) carried out the research to measure the job satisfaction using Jop Descriptive Index and M aslow’s hierarchy o f needs (1943) The result shovved that there were tvvo new factors: benefit and vvorking environment in order to be suitable vvith the reality in Vietnam

Therefore, creating work motivation for employees at PVFCCo North depends

on the following factors:

+ Job characteristics

+ Working conditions

+ Training and promotion

+ Incomes

+ Leaders

+ Colleagues

+ Working motivation o f staíĩs

The above seven components, as vvell as measuring criteria o f each components form the basis o f building research questionnaires

2 R esearch q u es tio n s co n stru ctio n

'ITie follovving contents will consider in detail how to set up questionnaire, to sample, to select tools for collecting iníòrmation and process o f iníormation collection

and statistics Processing.

2.1 Questionnaire and process o f iníormation coliection

- Step 1: Basing on theoretical basis and previous relevant researches to build thc initial questionnaire

- Step 2: The initial questionnaire will be adịust vvith a degree o f councelling from my supervisor and some respondents’ opinions so that it is appropriate and easy

to understand

- Step 3: The questionnaire is completed and sent for oíĩicial survey

Finally, the data gathered through the questionaire will he coded for statistical analysis Descriptive statistics arc applied to present the research results Microsoít Excel is used for statistical analysis

2.2 Designing research questions

Contents o f Questionnaire: Contain 7 factors described in 30 questions Each question will be measured by the Likert 5- point scale

- Factor ỉ: Job characteristics

+ I love my current job

+ I always understand my job

+ My job allovvs me to use my personal capacity well

+ My job is challenging and interesting

+ I have right to decide some issues o f my expertise

- Factor 2: Working conditions

+ I am provided vvith means o f work

+ My currcnt working place ensures convenience and saỉety

+ The vvorkload is assigned appropriately

+ My working timc is arranged logically.

- Factor 3: Opportunities o f training and promoting

+ I am fully trained necessary skills to carry out the work

+ I am íầcilitated to improve my professional knowlcdge

+ The Company alvvays gives opportunities o f promoting íor qualitìed

people.

+ Policy o f training and promoting is fair for everyone

- Factor 4: Incomes

+ My current salary is suitable to my capability and ability

+ I receive bonuses and allovvances that are worthy with working

eữĩciency.

+ Salary, bonuses and allowances are distributed equally

+ I can live totally on my income írom the company

- Factor 5: Leaders

+ I meet no diíTiculty in communicating and exchanging vvith the superior + The superiors alvvays support and encourage me vvhen necessary

+ Everyone is íầirly treated by the superiors.

+ My superior is a pcrson who has management capacity

+ My superior is a person who has leadership ability

+ The superiors are vvilling to authorize when necessary

- Factor 6: Colleagues

+ My colleagues are willing to hclp me when necessary

+ My colleagues are alvvays ữiendly and sociable

+ My colleagues always complete work conscientiously

+ My colleagues are reliable

- Factor 7; Working motivation o f staffs

+ In general, I have work motivation at the company

+ I am happy to choose to vvork at the Company

+ 1 consider work place as my second home

2.3 Sampling

Because research subjects vvere employces at PVFCCo North, the survey samples were sent to all oíĩicials and employees o f departments or units, including employees that the company uses Outsourcing Services

The Questionnaires were administered among subjects by the survey questionnaire printed on paper The number o f the released questionnaires is 50 copies; the number o f collected questionnaires is 50 copies

2.4 Methodological issues

Questionaire vvas collected not from typical subject, but from all employees (excluding management board) thereíore it ensured the objectivity, synthesis and is believable However, 6/50 questionare was collected from employees that company uses outsourcing services Monthly, they got only: íĩxed salary, perdiem, social and health insurance at minimum, supporting equipment, vvorking phone; thus assessmenl on this object would not be comprehensive, especially elements o f training opportunity and promotion, incomes This assessment accounts for 12% and only 2 elements are inlluenced thus assessment result is still able to ensure the objectivity