Determinants of job seekers to select recruitment agency for new job vacancies master project in business administration

Through the assessment of job seekers, recruiter and recruitment agency will understand which vacancy’s characteristics they should focus on to communicate and select “right candidate”..

PHAN XUÂN BÌNH

DETERMINANTS OF JOB SEEKERS TO SELECT RECRUITMENT AGENCY FOR NEW JOB VACANCIES

MASTER PROJECT MASTER IN BUSINESS ADMINISTRATION

(PART-TIME)

Tutor’s Name: Dr NGUYỄN MINH HÀ

Ho Chi Minh City

(2010)

ABSTRACT

The study aims to find out key factors which strongly influence to the selection of job seekers when approaching recruitment agency for new job Job seekers’ assessments involve in job vacancy – influences and characteristics of recruiters and recruitment agency – standard operational procedures practiced by both recruitment agency and recruiter The study tries to find out the difference of using recruitment agency and other sources Through the assessment of job seekers, recruiter and recruitment agency will understand which vacancy’s characteristics they should focus on to communicate and select “right candidate” The operational procedures of recruitment services are analyzed to verify its interaction to job seekers From the results those working in this services and also recruiter can consider to leverage the advantages of their companies in attracting more applicator Besides, the limitation of recruitment and selection procedure, interviewer should be corrected to improve the professionalism and attractiveness

of both recruiter and recruitment agency

Overall, this study tries to figure out the job seeker’s insight when they cooperate

to recruitment agency and recruiter Well understanding most important stakeholders, recruitment agency can improve its performance

Key words:

Recruitment, recruitment agency, recruitment sources, recruitment consultant, job

vacancy, job seekers

TABLE OF CONTENTS

CHAPER 1 - INTRODUCTION

1.1 General background 1

1.2 Rationale 2

1.3 Problem statement 3

1.4 Research objectives 3

1.5 Scope of study 4

1.6 Research method 4

1.7 Research structure 5

CHAPER 2 – LITERATURE REVIEW 2.1 Introduction and overview 6

2.2 Definitions 7

2.3 Theory of choices 11

2.4 Theory of Customer Behavior 15

2.4.1 Customer Behavior and Roles of Customer 15

2.4.2 Customer Needs and Wants 16

2.4.3 Values sought by User – Job seeker 17

2.5 Summary 18

CHAPER 3 - RESEARCH METHODOLOGY 3.1 Proposal research procedure 19

3.2 Research methodology 21

3.2.1 Qualitative research 21

3.2.2 Quantitative research 22

3.3 Assessment of measurement of scales 25

3.3.1 General perception of job seekers about sources of recruitment, job characteristics, and employers influences 25

3.3.2 Determinants of factors affect to the selection of recruitment agency by job seekers 28

3.4 Summary 30

CHAPER 4 - RESEARCH RESULTS 4.1 Descriptive statistics on total sample 32

4.1.1 Overall personal information 35

4.1.2 Working Industry 36

4.1.3 Current position 36

4.1.4 Sources to find job vacancy 37

4.1.5 Sources to find most recent job vacancy 39

4.2 Quantitative study 39

4.2.1 Factor analysis 39

4.2.2 Mean analysis 43

4.3 Exploratory Factor Analysis 45

4.4 Independent sample test 55

4.4.1 Working industry 56

4.4.2 Position 58

4.5 Summary 59

CHAPER 5 - CONCLUSION 5.1 Research summary 62

5.2 Recommendation 66

5.3 Limitation & suggestion further researches 66

Reference list i

Appendix A iv

Appendix B xi

Appendix C xii

Appendix D xiii

Appendix E xv

Appendix F xxvii

LIST OF TABLES

Table 2.1Customer Behavior Domain 15

Table 3.1 Research procedure 20

Table 3.2 Variables for factor – Sources of recruitment 26

Table 3.3Vacancy characteristics 26

Table 3.4 Required Information of vacancy 27

Table 3.5 Professionalism of employers and interviewers 27

Table 3.6 Job vacancy characteristics & attractiveness introduced by RA 28

Table 3.7 Recruitment agency characteristics 29

Table 3.8 Recruitment consultant’ competences 30

Table 3.9 Convenience of interview by RA 30

Table 4.1 Qualitative statistics 32

Table 4.2 Factor Analysis Results 47

Table 4.3 Cronbach Alpha’s value of each factor 53

Table 4.4 Reliability test results ranking by descending importance 54

Table 4.5 Statistics Result of Independent-Sample T-test (Service and Supply Chain – Logistics) for all factors 56

Table 4.6 Statistics on Independent –Samples T-Test – Factor 4 57

Table 4.7 Variable’s mean in Factor 4 58

Table 4.8 Statistics Result of Independent-Sample T-test (Officer and Middle Management position) for all factors 60

LIST OF CHARTS

Chart 4.1 Gender 35

Chart 4.2 Working industry 36

Chart 4.3 Current position of respondents 36

Chart 4.4 Newspaper advert source 37

Chart 4.5 Post CV on online recruitment website source 38

Chart 4.6 Recruitment agency 38

Chart 4.7 Walks-in 39

Chart 4.8 Other sources 39

Chart 4.9 Sources for recent job vacancy 40

Chart 4.10 Factors summary 60

Deeply in my heart, I would like to say my big thanks for my parents who never stop encourage and support me to pursuit my learning I’m deeply aware of their sacrifice and promise not to disappoint them

I would like to acknowledge all my professors and coordinators at Solvay Brussels School and HoChiMinh City Open University who provide us valuable knowledge and support with their best whole- hearted attitudes

Of course, I could never have reached this point without the great assistance of my tutor, PhD Nguyen Minh Ha His positive feedbacks, coaching and encouragement help me to find out the best way to finish this thesis Thanks so much for your kind assistance

I also would like to acknowledge the support of my family, friends, employer and colleagues had shown to me Without their encouragement and sharing, I will be difficult to do such a work

For my classmates who have been with me for the whole course, without their assistance, encouragement and sharing, I may lose my spirit and face so much difficulties I extend a huge thanks to all beloved classmates

Lastly, I would like to thank all the participants to my research

CHAPTER 1 - INTRODUCTION 1.1 GENERAL BACKGROUND

Vietnam is one of the top highest growing countries in the world for the last decade and coming years Together with the high growth is the huge demand of well - qualified labor force especially in big economic centers such as Ha Noi and Ho Chi Minh City

This trend explains why Vietnam is a very promising market and destination for recruitment services Since 1995 many well known consultancies as KPMG, Price Waterhouse Coppers, Ernst & Young, Grant Thornton had set up its recruitment services in Vietnam besides the presence of many specialized recruitment agencies

as Manpower, Bo Le, FirstAlliances, L&A, HR capital Vietnam, VIP Database, HR2B, NetViet After the recovery of financial crisis in 2009, famous worldwide recruitment agencies such as Andecco, Robert Walters, Jobstreet, Odgers Berndtson have eyed Vietnam market However the increasing growth in term of quantity of well-experienced labor force is always lower than the demand This circumstance explains why there always exists a fierce competition among recruitment agencies to attract and enrich its candidate’s pool and improve job seekers’ interest and attention to job openings

Recruitment is one of elements of human resource management as it is the method

to use to acquire the human capital for the organization That’s why most of foreign and big local companies use recruitment agencies (or employment agencies) as one

of the key recruitment sources to attract middle to senior employees

In the view of employer, the time to fill job vacancy and suitability of candidate is one

of key performance indicators to evaluate the quality of recruitment agency services

To meet the demand of clients (recruiters), recruitment agencies (RA) have to be aware of assessment job seekers to communicate and attract their interests, attention and intention to job vacancies

This study tries to indicate the significant factors which affect job seekers’ choice of recruitment agency as recruitment sources for a new job The findings are important for recruitment agencies to navigate, improve its services and enhance quality of its key manpower – recruitment consultants

1.2 RATIONALE

Recruitment agencies play an intermediate role between employers/ recruiters and job seekers for a specific job vacancy It appears that most of employers choose a recruitment agency despite there is maybe higher expenses of this source than using other recruitment sources in some extents below:

• The job vacancy is top confidential and recruiter cannot launch the public recruitment

• The vacancy requires very short time to fill

• The limited staffing resources of recruiting department or

• The limited candidate pool in some industry or function which may cause very long time to fill the vacancy or to find out the right candidate

In the view of employers/ recruiters, the pre-hire outcomes means the time vacancy

is filled; the number of qualified shortlisted candidates, candidates’ suitability and fill rate are important criteria to evaluate the quality of recruitment agency services

To meet required pre-hire outcome, recruitment agencies (RA) have to understand their job seekers’ insights and influences to communicate and to attract their interests, attention and intention to job vacancies

Consistency to the above reasons, the qualified candidate pool will impact strongly

on the performance and service quality of a recruitment agency (RA) Besides, the

rapidly increasing recruitment agencies so far in Vietnam labor market leads to fierce competition to all RAs to attract and enrich more qualified job seekers and improve their services Thus, understanding job seeker’s behavior is fundamental findings for RAs to build up its strategy, improve service quality and enhance its key manpower as well as apply professional recruitment procedures

1.3 PROBLEM STATEMENT

There have been many researches on recruitment and selection and its correlation

to recruitment outcomes However a study on the determinants of job seekers to select recruitment agencies as one of recruitment sources has not been conducted

yet, especially in Vietnam This study tries to indicate what factors influence job

seekers’ decision regarding to new job vacancy through recruitment agency

By analyzing the significant factors, those working in this service can lever performance by efficiently approaching their candidates, improving performance and clients’ satisfaction

1.4 RESEARCH OBJECTIVES

To give the answers to the above questions, the research objectives are:

1 To identify what factors influence job seekers to select recruitment agency when they look for new job;

2 To suggest some recommendations for improving performance and quality of service

1.5 SCOPE OF STUDY

In Vietnam, due to the constraint on recruitment budget and also the common practice of employers, 90% of RAs’ clients are foreign, FDI and local big size companies1 That’s why this study will only focus on:

• Employees those classified as white and yellow collar worker, working for nongovernmental organizations, gross salary in range VND 6 –50 million per month plus working experience at least 3 years in foreign companies, joint venture or big local private companies

• Survey activities are focused mainly in HoChiMinh city

• The recruitment and selection of foreign, FDI and big local private companies

in HoChi Minh city for officer to senior levels

1.6 RESEARCH METHOD

The main method is quantitative This research has implemented through 02 steps (1) qualitative method by interviewing job seekers, recruitment consultants, specialist and observation and (2) quantitative research

• Qualitative research defined factors which impact job seekers’ decision when applying for a new job vacancy; their assessment of recruitment agencies, recruitment consultants in performing their services Qualitative research was implemented by collecting and analyzing feedbacks from job seekers, recruitment consultants together with discussing during interviews and group discussion

• Quantitative research:

o Questionnaire conducted by online survey using Google survey tool

o Questionnaire sent to list of 1,500 working population which selected from

02 sources by convenience sampling method (1) 1,200 is the database

1 This number provided by some recruitment consultant specialists working in well- known RA

candidates of recruitment agencies (2) other 300 elements which meet the sample requirement

o There are 162 responses All are valid

o Data is processed by SPSS version 13.0

Measurement of scales tested by Cronbach Apha Independent- sample T-tests are also implemented for two groups of service respondents and supply chain – logistics one to identify any difference in these groups on assessment the key factors which influence to the selection of recruitment agency for new job by job seekers

1.7 RESEARCH STRUCTURE

The research is arranged into 05 parts

Chapter 1 – Introduction introduces the research background, objectives, scope of

the study and structure

Chapter 2 – Literature Review provides comprehensive literature on theories of

choice, theory of customer behavior Some conceptual definitions of recruitment and selection procedure, recruitment agency, job seeker

Chapter 3 – Research Methodology presents proposed research procedure;

research methodology includes qualitative and quantitative study This chapter defines factors and its variables, measurement of scales

Chapter 4 – Research Findings – provides an overview of the study including

descriptive statistics, exploratory factor analysis, assessment of measurement of scales and independent sample tests

Chapter 5 – Conclusion

CHAPTER 2 – LITERATURE REVIEW

Chapter 2 presents some definitions about the job seekers, recruitment, recruitment sources and recruitment services The connections between recruitment agency – employer – job seekers are also explained Theory of choices, theory of customer behavior and theory of decision making are fundamental literature from which the

choice of factors and its set of variables relating to this research will be discussed 2.1 INTRODUCTION AND OVERVIEW:

The most important determinant of organizational effectiveness is the ability to attract, hire, and develop capable talent To be able to compete, firms must be able to find and retain the best available employees The ability to attract and retain superior employees can lead to sustained competitive advantage for organizations Thus, recruitment and selection is as one of key element of human resources management This is difficult due to the shrinking availability of qualified labor The use of recruitment agency allows HR departments to target and identify quality candidates with more efficiency Employment agencies is kind of consultancy Employment agency provides wide range of employment services as executive search and selection, employees outsourcing, payroll, etc Some employment agencies focus their efforts on executive, managerial, and professional positions These executive search firms are split into two groups: (1) contingency firms that charge a fee only after a candidate has been hired by a client company and (2) retainer firms that charge a client a set fee whether or not the contracted search is successful Most of recruitment agencies in Vietnam apply contingency basis Only some of the larger firms work on a retainer basis

When only mentioning about executive search and selection services, recruitment agency is normally understood as third party recruiter that finds jobs for people

seeking them and finds people to fill particular jobs2 Executive search professionals are also involved throughout more of the hiring process, conducting detailed interviews as well as only presenting candidates to clients where they feel the candidate in question will fit into the employment culture of the client Executive search agencies typically have long-lasting relationships with clients spanning many years, and in such cases the suitability of candidates is paramount It is also important that such agencies operate with a high level of professionalism

Recruitment agency is a kind of services connecting the right candidate to particularly job vacancy which required by particular recruiter (employer) So, the outcomes of recruitment agency means that number of candidates voluntarily accepts the job offer with minimum time required to fill openings (The length of time it takes to fill openings) To be successful in performing their task and improving efficiency, recruitment agency that typically has a wide range of personal contacts within the area, a detailed specific knowledge of said area, and typically operate at the most senior level, has to deeply and widely understand determinants on job seekers to select them as recruitment source when seeking for new job These research streams focus on investigating the influences of recruiter’s effects, recruitment agency characteristics; job vacancy influences to job seekers

2.2 DEFINITIONS

Job seeker or job applicant or candidate is defined as who is actively looking for a job

Job seeker may be an unemployed or on-the-job person In the context of this research, job seeker means both who is actively and inactively apply for new job

opportunities

White collar worker 3 are officer, clerical, administrative, sales, professional, and technical employees White collar jobs are made synonymous to professionals who

2 The American Heritage® Dictionary of the English Language, 2000

3 defined by OECD Glossary of Statistical terms

obtained higher degrees and education and more corporate and managerial White collar jobs often have a cleaner of ‘better’ workplaces

Yellow collar worker is mentioned about those works in creative field as

photographer, filmmaker, designer, and artist

Blue collar workers are not considered as the application population of executive

search and selection services Blue collar jobs are often non management but actual physical labor type of jobs

However, there is also different point of view about the classification by Tran Viet Dzung, Lecturer of Economics, Vietnam National Administration Institute Mr Dzung classifies “Blue collar” worker is manual labor; “White collar” worker is expert and

“Yellow collar” is leaders, directors Even major stock holders of public companies also considered as yellow collar worker Mr Dzung mentions that in financial, banking industry, yellow collar worker defined as those can influence or create change in the market Experts or specialists who have strong network and can make influence on policy also defines in yellow collar class

In general, we can conclude that white and yellow collar workers are skilled, well qualified, well trained and do not involve to daily manual tasks

Applicant population is a subset of the labor force population that is available for

selection using a particular recruiting approach For recruitment agency, applicant population is restricted on those having gross salary from VND Million 6 to 50 per month and having appropriate competences working for foreign and big local companies Applicants are white and yellow collar worker hence they are expected to communicate in English and familiar to office soft wares; at least 03 years experience

in the same position or industry and other requirements depending on specific job opening (Mathis R.L & Jackson JS, 2005),

Recruitment

Barber (1998) defines recruitment as “those practices and activities carried on by the organization with the primary purpose of identifying and attracting potential employees” Recruitment has been conceptualized by Rynes (1991) as encompassing “all organizational practices and decisions that affect either the number, or types, of individuals who are willing to apply for, or accept, a given vacancy” The similar definition of recruitment by Breaugh (1992) “Employee recruitment involves those organizational activities that (1) influence the number and/or types of applicants who apply for a position and/or (2) effect whether a job offer is accepted”

Recruitment sources

Recruitment can focus on the internal labor market (i.e., pursuing staff already employed by the organization) or the external labor market (i.e., pursuing applicants from outside the organization) Internal candidates can be recruited through internal job postings, word-of-mouth, or internship programs Organizational practices used to recruit from external labor markets include employment advertising, employee referral programs, job fairs, college campus recruitment, employment agencies, rehiring former employees, or networking (Zottoli & Wanous, 2000)

Recruitment agency or Executive Search and Selection Agency

Mahin (1991) noted services in the business-to-business market can be categorized

in two distinct groups: product supported by services and pure services Consultancy

is belonging to the pure services group, those that are marketed in their own right without necessarily being associated with a physical product

Schein, (1987) wrote, process consultation is defined as a set of activities on the part

of the consultant that help the client to perceive, understand, and act upon the process events that occur in the client's environment

Dessler (2002) had clearly defined the employment agencies and classified its type of services

There are three types of employment agencies: (1) public agency operated by government; (2) agencies associated with nonprofit organization; (3) privately owned agencies

Private employment agencies are important sources of clerical, white-collar and managerial personnel Most are fee paid job in which employers pay the fee They charge fees for each vacancy they place

Executive recruiters or Executive Search and Selection agency are special employment agencies retained by employers to seek out top management talent for their clients

Executive Search and Selection agencies only focus their efforts on executive, managerial, and professional positions These firms are split into two groups: (1) contingency firms that charge a fee only after a candidate has been hired by a client company and (2) retainer firms that charge a client a set fee whether or not the contracted search is successful Most of the larger firms work on a retainer basis Search firms are ethically bound not to approach employees

Contingent-based executive search tend to handle to junior to middle level management job search

In the scope of this research, the service of Executive Search & Selection is analyzed

Also Dessler (2002) mentioned some reasons to choose RA by employers:

1 Employer doesn’t have its own HR department and is not geared to doing recruiting and screening

2 Employer has found it difficult in the past to generate a pool of qualified applicants

3 Employer must fill a particular opening quickly

4 They want to reach currently employed individuals, who might feel more comfortable dealing with agency than competing companies

5 To cut down on the time employer are devoting to recruiting

2.3 THEORY OF CHOICES

N Mankiw, J Gans and S.King (2002) had explained some principles influenced individual making decisions:

Principle 1 - People face trade-offs:

Making decisions requires trading off one goal against another This principle is considered in the context of job seekers those currently have a job or receive more than one job offer For the former case, they only face trade-offs between their current job and new job The latter case requires he/she has to consider all job offers and finally accept only one For all situations, job seeker may be stopped their tenure during probation period and become jobless It’s obvious that to gain the benefit of new offer as more attractive remuneration package, higher position, new knowledge exchange, better working location, etc… Job seeker has to trade off his/ her job security and other obvious benefits They will make decision by comparing all aspects

of pro and cons of current job and new offer

When applying for new job, job seekers always face to the risk of their privacy to be jeopardized The more the vacancies they apply, the higher risk of privacy to be disclosed The major concern is lack of assurance that private information on an individual's application form or resume will not be given or sold to a third party or used for other than hiring purposes (Lin & Stasinskaya, 2002)

In general, the very basic principle ‘People face trade-off’ modifies for the below factors and variables in this research:

• Factor ‘ Vacancy characteristics & attractiveness’:

o Job seeker trade off his/her current job security for new “challenging job” ; “high paid job”; “Preferred working location”; “Convenience of work place”; “Advancement”; ‘Higher position”

o Trade off current or ‘feasible future’ income (bonus, incentive) for new job because of similar characteristics mentioned above

o Trade off his confidentially (salary & personal information)

• Factor ‘Recruitment agency’s characteristics’: in case job seekers agree to apply specific vacancy through RA, means he can’t coordinate to other RA for that job Then he somehow has to consider between his “favorite” RA and selected RA

Principle 2 - The opportunity cost:

The opportunity cost is the cost of something what you give up to get that item When making decision, decision makers should be aware of the opportunity costs that accompany each possible action

When job seekers look for new job openings, the opportunity cost is time, money and efforts he/ she has to spend to search information, prepare application documents and attend interviews Other invisible cost which is difficult to measure is the privacy

to be disclosed during the interview Most of the recruiters are aware of their responsibilities and commitment to keep the candidate’s information confidentially However, they can’t promise totally follow this rule due to the job change of their staffs who involve to recruitment process

This principal is considered to explain these variables:

• Factor –‘Convenience of interview by RA’: the benefits job seekers estimate to gain comparing to his time and expenses to join interviews

Principle 3 - Rational people think at the margin

A rational decision maker takes an action if and only if the marginal benefit of the action exceeds the marginal cost This principle is the consequence of these above principles if applying to job seekers’ behavior As we has explained the opportunity cost of job seeker when trading off their current job for new job vacancies, job seekers consider to choose kind of recruitment sources which cost them less and bring more benefit than other sources Furthermore, job seekers those handle high level position are much afraid of revealing privacy For them, referrals, headhunting or recruitment agency is more trustworthy sources than walk-ins; to post their resume on online recruitment website or directly applying

Salary is the third concerns of employees in Vietnam when change job, according to XAGE consultancy report on Saigon Time weekly magazine, 40-2010) salary range is important information to candidate to decide applying or not a job openings Most of the company force their employee keep the salary top private and confidential Consistency, the job adverts can’t reveal salary range but open negotiable range for qualified candidate This policy is good for both employer and employee, however, it raise a bit confuse because candidates are afraid of they are underpaid Referring to this principle, some variables can be explained:

• Factor – ‘Recruitment sources’:

o Sources has higher probability of success to be set higher priority

o Sources has more useful information for making decision

• Factor ‘Recruitment agency’s characteristics’

o Among many recruitment agencies, which one can offer he/she better services or higher probability of success

• Factor ‘Recruitment consultant’s competences’

o Who is the recruitment consultant can provide he/she useful advice; frequently and timely updating feedbacks; who has deep understand about the vacancy/ recruiter/ industry

Principle 4 - People respond to incentive

People make decisions by comparing costs and benefits, their behavior may change when the cost and benefit change People change their behavior in respond to the incentive they face

Job seekers will choose which recruitment sources can offer to them higher benefit for the same level of job or they can use less resources to gain the offer They also consider which sources they can get higher probability of job offer

To observe the job adverts on printed paper couple years recently in Vietnam for white and yellow collar worker, most of recruiter accepts or recommend online application instead of hard application documents We can conclude that, employers have to attract applicants not only by their vacancy attractiveness, recruiter influences but the convenient way to apply also

• Factor ‘ Vacancy characteristics & attractiveness’:

o Remuneration packages offered to he/she is consistent or compensated

to what he/she has to do if he accepts new offer (variable – ‘High paid job’ & ‘Usefulness of information about vacancy’)

o His offered remuneration package is benchmarking to market pay or not (variable – ‘High paid job’)

• Factor –‘Convenience of interview by RA’: the result/ assessment of interview

by RA can be used for further suitable vacancies handled by that RA Æ save less time, have more chances to be approached by employers Furthermore,

feedback from both recruiter and RA can help candidate recognize his cons and succeed at other vacancy

2.4 THEORY OF CUSTOMER BEHAVIOR

2.4 1 Customer Behavior and Roles of Customer

Sheth & Mittal (2004) classified products and services into different sectors

Table 2.1 Customer Behavior Domain

HOUSEHOLD BUSINESS

Recruitment services belong to business sector including management training and consulting services, employment benefits services, etc

Regarding to the roles of customer, Sheth & Mittal stated that customer can play three different roles in the marketplace transaction: User, Buyer and Payer

The user is the person who actually consumes or uses the products or receives the benefits of the services The payer is the person who finances the purchase and the Buyer is the person who participates in the procurement of the products or services from the marketplace Regardless of whether the same person is the user, the payer

or the buyer each role dictates a different set of values that are sought by the customer

In recruitment agency, job seeker can be classified as User Obviously, job seeker is neither Payer nor Buyer because the services fee is paid by recruiter Recruiter or employer plays both roles: Payer and Buyer

About the reasons for role specification, Lack of Time and free from service fee can

be discussed to feature why a certain group of labor forces choose recruitment agency when seeking for new job

This concept is applied to explain for the influences of information relating to job vacancy, employer and recruitment process to choice of job seeker in selecting RA These items ‘The usefulness and transparency of vacancy’s information’ and ‘Consult

to candidate appropriate information about vacancy and recruitment procedure’ are select to measure for this factor

Free from Services Fee

The user is easily to accept the recruitment services because the service is given free

to him

2.4.2 Customer Needs and Wants

A need is an unsatisfactory condition of the customer that leads him or her to an action that makes the condition better

Customer Needs are determined by the traits of the individual and the traits of the environment The personal traits determine needs are genetics, biogenic and psychogenic Environment traits or market traits are climate, topography and ecology

A want is a desire to obtain more satisfaction than is absolutely necessary to improve

an unsatisfactory condition

In contrast to customer needs, customer wants are determined by individual context and environment context Individual context consists of three dimensions: personal financial worth, institution and culture Market context consists of economy, technology and public policy

All customer behavior is driven by needs and wants, by the value received through the use, the acquisition of products or services

This theory explains why services value, service quality are key factors which recruitment services have to focus on to attract job seekers

Further mentioning about values, Sheth & Mittal (2004) classified values by universal

& personal values Universal values are values that satisfy the needs of customers whilst personal values satisfy the wants Personal values pertain to something beyond the basic or universal reason to for buying a products or services Personal values therefore are different from person to person

Recruitment services is the connections between Individual (Job seeker) – Job vacancy – Recruiter (Employer) then personal values is what recruitment services focuses on to satisfy their customer “User” This concept is applied in this research to measure the matching between personal characteristics to job (P-J) and personal characteristics to organization (P- O)

2.4.3 Values sought by User – Job seeker

Playing the users role of recruitment services, job seekers pursuit both universal values and personal values

For Universal value, performance is what job seeker considers when to select recruitment agency A product’s or service’s performance value is the quality of

physical outcome of using the product or services The performance of recruitment agency is the ability to find job seeker the most satisfied job or the ability to support job seeker to get the most matched job This idea is the fundamental to explain some variables ‘High fill rate’; ‘Time to fill a vacancy’ and ‘satisfaction to new offer’ These variables are interrelate to factor –‘Recruitment agency characteristics’

For Personal values, job seekers concern about Social and Emotional factor

Users driven by social value choose products or service that convey a image congruent with the norms of their friends and associates or that convey a the social image they wish Social value exists when the products come to be associated with positive perceived social group

In recruitment services, certain of candidates tend to seek new job or accept new offer through recruitment agency or referrals than themselves apply for job openings This phenomenon can be explained using the principle – Rationale people thinks of margin’ which presented in this chapter

2.5 SUMMARY

Due to the limitation in referring to previous researches, basing on the literature of micro economics (04 principles in theories of Choices) and theory of customer behavior, research model is proposed including 04 factors: (1) Job vacancy characteristics and attractiveness (2) Recruitment agency characteristics (3) Recruitment Consultant’ competences and (4) Convenience of interview by RA Four main factors will define the influences and assessment of job seekers when they choose RA as source to apply for new job

CHAPTER 3 - RESEARCH METHODOLOGY

Regarding to research objectives, limitation of study and research method presented

in Chapter 1, literature review presented on Chapter 2, chapter 3 – Research Methodology proposes in details research procedure, research method and assessment of measurement of scales in order to test the research model

3.1 PROPOSAL RESEARCH PROCEDURE

Table 3.1: Research procedure

Qualitative research

Interview jobseekers (05); recruitment consultants (03)

Draft questionnaire

Final questionnaire

Trial Survey

To check the understanding of respondents and adjust the

questionnaire (N=20)

Quantitative survey

- 1,500 email sent to working population; focusing on those

sought new jobs through recruitment agencies

- 162 valid respondents

- Coding, Inputting data

- Filtering data

- Exploratory Factor analysis

- Assessment measurement of scale

Report

Research problem

To define determinants of job seekers to select recruitment

agency for new job

Literature review

Theory of choices, Theory of customer behavior

Discussion proposal

3.2 RESEARCH METHODOLOGY

Research is implemented by two steps (1) Qualitative research aims to verify items and factors to draft questionnaire (2) Quantitative research aims to get data, analyse data, define factors and its variables, assessment measure and verify impact and influences of each factor

3.2.1 Qualitative research

Because researcher can’t refer to similar or relevant researches about this subject, especially in Vietnam, the purpose of qualitative research is to collect key issues relating to behavior and assessment of job seekers when they interact with recruitment agencies, recruitment consultants and recruiters for a new job vacancy Recruitment consultants who strongly interfere in recruitment process also advise some significant ideas The key findings during interviews and experience of research are used as fundamental to draft questionnaire The questionnaire is customized for the purpose of the research, focus on the respondents who mainly live and work in HoChiMinh city and qualified to be target candidates of recruitment agency

Regarding to primary purpose and literature review, discussion questions for job seekers are designed in Appendix B Appendix C includes some questions discussing with recruitment consultant

After drafting the discussion questions, for job seekers, target is currently recruitment agency’ candidates (means they have been approached RA) or not face – to- face interview is implemented For consultants, 03 experienced recruitment consultants at two levels (consultants and manager) had joined the discussion together

The draft questionnaire was designed after finalizing and filtering the comments, advices during discussion and interviews

Questionnaire uses mainly Likert scales anchored by 1 (Strongly disagree / unlikely)

to 5 (Strongly agree/likely)

The draft questionnaire was tested by 20 respondents then edited and revised

Ideas and comments gained during discussion and interviews:

• Job seekers much concern about the results of interviews conducted by both recruitment agency and employer

• Job seekers highly appreciate prompt and fairly feedbacks from both sides: agency and employer about the interview result and comments

• Job seekers try to get as much as information about the vacancy, the employer, the recruitment procedure practiced by employer

• Job seekers tend to maintain close connection to the recruitment consultant if they recognize the consultants’ competences

agency, they still approach these sources when looking for new job again

• Factors determine the selection of recruitment agency of job seekers:

resulted and filtered during qualitative survey Besides, the fundamental of this survey includes literature review, proposal research methodology, questionnaire and accepted measurement of scales

• Pre quantitative Survey phase - Questionnaire design

Questionnaire includes 04 parts:

- Part A: Respondent information: simple demographic question about respondents’ personal information as name, gender, age, working industry, current position (level), years of experience, monthly salary, contact Nominal scales are used in this part All respondents obviously are required to answer this part

- Part B: About the vacancy and employer characteristics

Combined Interval scales and nominal scales are used in this part This part aims to disclose job seekers’ perceptions about job vacancy and the influences of employers Sources of recruitment and frequency of information update is also collected for communication, marketing purpose Thus this part is outside the main objective of this research

- Part C: This part is the most important component of the survey Only job seekers who proactively or inactively looking for new job through recruitment agencies answer this part The result of this part is data for factor analysis Out of 03 questions, interval scales are used to assess 29 variables in Likert 05 scales, other questions use nominal scales

- Part D: using open question to verify some comments of respondents who skipped part C The purpose is to investigate some reasons why recruitment agency is not their selection when looking for job

• Official survey phase:

- Population: White and yellow collar workers meet some criteria as below:

9 Currently having at least 03 years working in nongovernmental organizations, big private local, FDI companies in HoChiMinh city

9 Salary is around VND 6 to 50 million per month

9 Using source of candidates of recruitment agency and other source which meet the criteria

9 Advised by expert in recruitment services, the population is estimated between 250,000 to 30,000

- Sample size: There are many opinions about the size in quantitative research

Tabachnick and Fidell (2001) review this issue and suggest that ‘it is comforting to

have at least 300 cases for factor analysis However, they do concede that a smaller

sample size (e.g 150 cases) should be sufficient if solutions have several high loading marker variables (above 80) Some authors suggest that it is not the overall

sample size that is of concern— rather the ratio of subjects to items Nunnally (1978) recommends a 10 to 1 ratio: that is, 10 cases for each item to be factor analysed Others suggest that 5 cases for each item are adequate in most cases (Tabachnick & Fidell, 2001) This research applies factor analysis, according to Gorsuch (1983), at least 200 responses is acceptable Hatcher (1994) recommends a 5:1 ratio or at least

100 This survey has 29 variables

Regarding to theory of Tabachnick and Fidell (2001), there is 11 out of 25 variables

having high loading above 0.8 Comparing to sample theory of Hatcher (1994),

responses range is 145 to 290 for this study are acceptable

- Data collection: Final questionnaire was designed using Google survey online tool

Final questionnaire was officially sent to respondents by email with attached link

https://spreadsheets.google.com/viewform?formkey=dEtCRXBBamR4V1dXeHBzR21wY0w5VUE6MQ

Convenience sample method is applied There are no invalid responses However, due to the limitation of online survey versus printed questionnaire and face – to – face interview, it’s difficult to calculate the ratio between respond rate and population

- Data analysis: after collecting necessary responses, all data to be filtered to

eliminate invalid responses, code variables, input and filter by SPSS version 13.0 Then data analysis is conducted

Factor Analysis (FA) is ‘data reduction’ technique It takes a large set of variables and looks for a way that the data may be ‘reduced’ or summarised using a smaller set of factors or components It does this by looking for ‘clumps’ or groups among the inter-correlations of a set of variables

There are two main approaches to factor analysis This research applies exploratory factor analysis (EFA) EFA is often used in the early stages of research to gather information about (explore) the interrelationships among a set of variables Variables are chosen if its factor loading >= 0.45, the Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy (Kaiser, 1970, 1974), 0.5 = <KMO <= 1 Sums of squared of loading >= 50% (Pallant, 2005)

Factors to be tested its reliability and validity by Cronbach’s Alpha value Variables or items will be eliminated if Corrected Item – Total Correlation is less than 0.3 Measurement of scales is accepted if at least 0.6

Furthermore, Independent sample test used to compare the mean scores of two different groups of respondents

3.3 ASSESSMENT OF MEASUREMENT OF SCALE

3.3.1 General perception of job seekers about sources of recruitment, job

characteristics, and employers influences

3.3.1.1 Sources of recruitment

Variables measured for factor – ‘Sources of recruitment’ in table 3.2

Table 3.2: Variables for factor – Sources of recruitment

Code Item

TK2

Post your C.V on online recruitment website as

vietnamworks.com to allow recruiters to read and approach

Variables measured for factor – ‘Vacancy attractiveness’ in Table 3.3

Table 3.3 – Vacancy characteristics

Code Item QT1 Personal - Job fit (P-J)

QT2 Personal – Organizational fit (P-O)

QT5 Preferred working location

QT6 Challenging/ interesting job

QT7 Advancement

QT9 Others

3.3.1.3 Required information

Variables measured for factor – ‘Required information of vacancy’ in table 3.4

Table 3.4 – Required Information of vacancy

Code Item

TTTD2 The main role and accountabilities of the incumbent

TTTD5 Culture of the company/ the department

DT1 The convenience when searching for information

DT2 The usefulness and plenty of information

3.3.1.4 Professionalism of employers, interviewers

Variables measured for factor – ‘Professionalism of employers and interviewers’ in

table 3.5

Table 3.5 – Professionalism of employers and interviewers

Code Item DT1 The convenience when searching for information

DT2 The usefulness and plenty of information

DT9 Flexibility in arranging time and place of interviews

DT10

Prompt feedback result and advise appropriate information/

next steps for candidates

DT11 Usefulness of the tests

DT12 Reasonable recruitment procedure

DT13 Confidentiality

DT14 Time to fill the placement

3.3.2 Determinants of factors affect to the selection of recruitment agency by job seekers

3.3.2.1 Job vacancy characteristics & attractiveness

Variables measured for factor – ‘Job vacancy characteristics & attractiveness

introduced by RA‘in table 3.6

Table 3.6 - Job vacancy characteristics & attractiveness introduced by RA

VA1

The usefulness and transparency of information in regard to vacancy profile

VA4 Preferred working location

3.3.2.2 Recruitment agency characteristics

Variables measured for factor – ‘Recruitment agency characteristics ‘in table 3.7

Table 3.7 - Recruitment agency characteristics

QD4 Diversified of vacancy levels and industries

QD5 Specific vacancy levels and industries

QD6 Strong customer – base and well-known clients(recruiters)

QD7 High frequency of updated information on website

QD8 Usefulness of the tests

QD10 Usefulness of consultancy services

QD11 Quality of consultancy services

QD12 High fill rate

QD13 Time to fill a vacancy

QD14 Satisfaction to new offer

3.3.2.3 Recruitment consultant’ competences

Variables measured for factor – ‘Recruitment consultant’ competences in table 3.8

Table 3.8 - Recruitment consultant’ competences

RC5 Appearance and grooming

RC6 Consult to candidate appropriate information about vacancy

and recruitment procedure

RC7 Quickly feedback and advise appropriate information/ next

steps for candidates

3.3.2.4 Convenience of interview by RA

Variables measured for factor – ‘Convenience of interview by RA ‘ in table 3.9

Table 3.9 - Convenience of interview by RA

IT1 Place of the interview

IT2 Time of the interview

IT3 Duration of the interview

3.4 SUMMARY

Both qualitative and quantitative studies are used in this project Qualitative studies are implemented by face-to-face interviews with job seekers Besides group discussion with 03 recruitment consultants to explore deeper understanding about the determinants of job seekers when they approach recruitment agency is conducted To adjust the wording and assure the appropriate understanding of all questions, 20 samples had been sent for testing and collecting comments Targets of this research

is white and yellow collar workers who work for nongovernmental organizations, big private local and FDI companies in HoChiMInh city

For the main purpose of the research, there are 51 variables in which 29 items used

in Likert 05 scale These variables correlated to 04 factors These factors have a

strongly impact on the selection of job seekers when looking for job Factor 1 – ‘Job

vacancy characteristics & attractiveness’ (5 items); Factor 2 – ‘Recruitment agency characteristics’ (14 items); Factor 3 –‘Recruitment consultant’ competences’ (07

items) and Factor 4-‘Convenience of interview by RA’ (03 items)

Nominal scales are used to analyse 22 remain variables about their brand awareness of recruitment agencies and their preferred communication channel