Low job satisfaction at b o b coffee

Job satisfaction has a close relationship with employee performance and translates into the company success because happy employees bring happy customers.. In the studying company B.O.B

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-Nguyen Hong Yen Van

LOW JOB SATISFACTION

AT B.O.B COFFEE

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – Year 2018

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-Nguyen Hong Yen Van

LOW JOB SATISFACTION

AT B.O.B COFFEE

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: Dr Nguyen Phong Nguyen

Ho Chi Minh City – Year 2018

TABLE OF CONTENTS

Executive Summary 1

CHAPTER 1 : BACKGROUND INFORMATION 2

1.1 Company background 2

1.2 Symptoms 3

1.3 Initial cause-effect map 6

1.4 Updated cause-effect map 10

CHAPTER 2: PROBLEM JUSTIFICATION 15

2.1 Problem definition 15

2.2 Problem existence 16

2.3 Problem importance 19

CHAPTER 3: CAUSES VALIDATION AND SOLUTIONS 20

3.1 List of real causes 20

3.2 The set of solutions 25

3.3 Change plan design 28

REFERENCES 35

APPENDICES 42

TABLE OF FIGURES Figure 1 Organizational structure of B.O.B Coffee 3

Figure 2 Initial cause-effect map (Source: In-depth interview) 7

Figure 3 Updated cause-effect map (Source: In-depth interview and literature review) 13

Figure 4 Final cause-effect map 23

TABLE OF TABLES Table 1 Sales from January to June in 2017 and 2018 (million VND) 4

Table 2 Profit from January to June in 2016 and 2017 (million VND) 4

Table 3 Number of negative feedback and complaint 4

Table 4 Turnover rate of some coffee shops in Dong Thap and average turnover rate of hospitality in Vietnam (https://business.linkedin.com/talent-solutions/blog/trends-and-research/2018/the-3-industries-with-the-highest-turnover-rates) 5

Table 5 Result of survey 17

Table 6 Initial list of potential causes (Source: reference) 20

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Executive Summary

Job satisfaction of employee and their attitude have become the important foundation

of any business Especially in the globally dynamic business environment these days, enterprises have begun to realize that their most precious asset is the employees (1-4) According to Robbins (1996), job satisfaction is one of the most vital merits in today’s workforce, “generation X” (5) Job satisfaction has a close relationship with employee performance and translates into the company success because happy employees bring happy customers In the studying company B.O.B Coffee, despite an extreme focus into the daily operation of the coffee shops within the chain with the purpose of enhancing customer satisfaction and the company performance, the company has witnessed a large number of complaints from customers, a decrease in sales, profit as well as a high turnover rate of employee Starting by investigate these symptoms, we have figure out the central problem is low job satisfaction The result indicates that the actual causes of this central problem are pay, promotion, supervision, contingent reward, and communication Accordingly, basing on the context of the organization, the research proposes some solution in terms of supervision, contingent reward (recognition) and communication so that the job satisfaction of employee can be improved and consequently the business performance can be enhanced It is estimated

that the company could benefit 5 times greater than its cost

40 part-time employees

- Full name: Bi O Bi Private Company

- Established: 01/12/2014

- Address: 20 Ly Thuong Kiet, Ward 1, Cao Lanh City, Dong Thap Province

- Main products and services: food and beverage

The organization has six full-time employees (one HR manager, one marketing manager, one accountant, three store managers) and more than forty part-time employees who are mostly students at university and colleges in the province

Corresponding to the growth of Dong Thap province, the consumers become more affluent, they are seeking a comfortable place to drink and relax Coffee has appeared and played a vital role in daily life of Dong Thap citizens for a long time ago, and coffee shops can be considered as the third place beside home and office Therefore, there are more and more coffee shops with modern styles which provides air conditions, professional service, western drinks… This means customers have many choices and the market becomes more competitive

to look at financial statements and many symptoms were explored

CEO

Part-time employee

Marketing

4

Table 1 Sales from January to June in 2017 and 2018 (million VND)

Table 2 Profit from January to June in 2016 and 2017 (million VND)

According to data from the company, although sales and profit in the two first months

of 2018 increases compared to this in 2017, the following months of 2018 witnesses a decrease of sales and profit compared to this in 2017 As a result, total sales and total profit of two first quarter in 2018 declines 0.6% and % respectively to this in 2017

In addition, the number of bad complaint rises 20% in the period with 478 negative feedbacks and complaints from customers which are talked directly to store managers and appear on its social media channels compared to this period last year

Table 3 Number of negative feedback and complaint

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Another important symptom worth mentioning is that the turnover rate of B.O.B Coffee is high (20%) compared to other coffee shops in the area (Truc Garden and May Coffee) and average turnover rate in hospitality industry in Vietnam in 2017 (17.2%) (according to LinkedIn’s data) Truc Garden and May Coffee which are two well-known coffee chains in Dong Thap province have the nearly same scale with B.O.B Coffee with 39 and 42 employees respectively in total Based on the short interviews with managers of these two coffee chains, they state that turnover rate of their organization are also high which are 30% and 27% in that order, but these figure are still lower than the rate of B.O.B Coffee

Table 4 Turnover rate of some coffee shops in Dong Thap and average turnover rate

of hospitality in Vietnam

a positive effect on customer loyalty which also means the repetition of customers’ purchase behavior (6) Furthermore, earlier research has proven that customers who are satisfied do not show price sensitivity and are willing to pay more for high quality products and services (7-9) It is also reported in a number of studies that customer

1.3 Initial cause-effect map

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Figure 2 Initial cause-effect map (Source: In-depth interview)

Poor product quality

Complaint from customer increase

High turnover rate

Sales decrease

Low customer satisfaction

Poor service quality

Poor physical environment

Low productivity

Low job

satisfaction

Low employee morale

Unwell trained

staff

Poor skill and knowledge of staff

Potential central

Excessive absence of staff

Insufficiency

of staff

Profit decrease

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In order to explore the central problem and its causes as well, the in-depth interviews with a staff (randomly selected) and some key employees including CEO, two store managers and HR manager were conducted at B.O.B stores in five days and recorded

by mobile phone Initially, the interviews with two store managers of B.O.B Coffee reveal that most of customers are unsatisfied because of the poor quality of service and product Many negative feedbacks are collected directly at the stores through conversations with customers and also from social media channels of B.O.B Coffee such as Facebook, Instagram, Zalo fanpages As Ms Vy (manager of store A) said, staff are more likely to be absent due to personal reasons but sometimes she realizes that some reasons are fake When she assigns other employees to fill in for absent co-workers, they seem not really happy and supportive She thinks that this is because employees are not doing what they enjoy, even little things like sometime working overtime makes them feel unhappy This may be a sign of employee dissatisfaction Especially on holiday or weekend, excessive absence of staff causes a lack of employee and consequently the rest staff meet difficulties to handle so many orders well and feel stressed out This leads to untasteful drinks, late delivery and scowl faces

of staff, which makes customers feel disappointed on the service provided by the coffee shop

As Mr Nhan (manager of store B) said, on the fanpage, there are also some complaints about some staff who show unpleasant attitude and impolite words when serving drinks or they required to clean the table Bad attitude and behavior of employee is a sign of low employee morale, which adversely affect to working environment and in-store atmosphere When employees work for a long time, they are not as powerful and enthusiastic as on very first days, which reflects reduction of morale As a result, they change usually commit themselves to the company for the long term and are going to quit so that they can find a job they actually enjoy doing sooner or later This is also one of the main reasons the company has to recruit new staff very often

In the opinion of a staff of store C, employees have to work very hard in seasonal period on which complains from customers increase dramatically Although the company ussually recruits more new staff, the more new staff recruited at the same time on account of seasonal needs, the more difficult it is for the manager to coach

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newcomers effectively and closely As she said, new employees are mostly on-the-job trained and coached by the store manager and supported by old ones Therefore, wrong knowledge and experience may be instructed from the old employees to tenderfoot, which negatively influences to service and product quality Accordingly, staffs who are not well trained and work with insufficient knowledge will feel confused and do not understand what customers want, leading to taking wrong orders or producing poor quality products Customers will get annoyed when the drink served is not what they order or not tasty She thinks that in order to serve customers effectively and professional, both barista and staff need to be well equipped with knowledge and skills through training before becoming real employees

Based on the interview with HR manager of the company, there is a variety of causes resulting in decreases in sales, customer satisfation Ms Huong mentions that one of the most important thing to retent customers is the quality of product and service, which are directly affected by employee Therefore, the company always try to ensure the quality of workforce by implementing various human resource management practices Training is greatly concerned to equid adaquate knowledge and skills for employee Besides, she points out that job satisfation is also extremely vital HR department also tries to raise the level of job satisfation among employee because it has a strong relationship with the atmosphere in the workplace and producticity as well Only when they enjoy the job, they provide the best service and product As she observed, both full-time and part-time employees experience unhappiness and low productivity This may be a sign of low job satisfaction, but the company has not had any report about this yet Low job satisfaction can cause low morale, which in turn leads to high turnover rate She knows that high turnover rate is not always bad, but losing high-performing employees is well worth worrying Experienced and qualified employees tend to leave the company while it takes time and money to recruit new ones to replace managerial positions

An interview with the CEO of B.O.B Coffee followed, he shares the same idea that both fulltime and part-time employees have low morale at the workplace when they are more likely report stress on their job because they do not actually enjoy the job, leading to low productivity He talked to some employees and found that the level of

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satisfaction of both full time and part time employees is moderate As he observed, the real time for completing a certain task such as making a drink already for serving is longer than it is regulated This low productivity causes long line of waiting and customer frustration Some customers are impatient, if the beverage that they order does not serve on time, customers will just cancel their order and leave the coffee shop Besides, he mentioned about some complaints from customers about the physical environment of two of three stores of B.O.B Boring music and dirty furniture make customer do not want to sit down and stay longer This is because staff do not pay attention to choose the suitable music and ignore to clean the table clearly He also admits that the smile culture of the company no longer remains by its staff Instead, employees show tired faces or never mind to say hello to customers although they are trained before about the culture They are even chatting rudely and loudly with colleages while carrying out orders, which adversely affects to relaxing atmosphere in the coffee shop Therefore, customers have posted complaints on Facebook and tend to switch to other coffee shops that can offer a better environment for customers to socialize or enjoy

1.4 Updated cause-effect map

After review the literature, some new variables are found and developed from initial map as below:

Price fairness

It is proven in the marketing literature that price is a vital factor of consumer satisfaction, because consumers usually think of the price whenever they assess the perceived value of a product or service (6, 7, 16-18) Price fairness means reasonable prices of the food items served in a specific restaurant in comparison with those offered by other restaurants with the same quality standards (19) The effect of price and value on customer satisfaction in the restaurant industry have been investigated in a variety of studies during the period years and found to be an significant factor (20-26)

The impact of price increase on customer satisfaction in the restaurant industry in German was researched by Homburg et al (2005) (23) Their results implied that the

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higher the satisfaction is, the lower negative effects of price on the repurchase intention will be, thus it correlates the fact that there is a reverse relationship between the two; if one rises, the other falls In other words, if price goes up, satisfaction goes down (23)

Other empirical researches jump into the similarity of conclusions, making suggestion that perceived price fairness impacts positively customer satisfaction (27)

Technology

Although the use of technology goes along with financial expenses, it can boost customer satisfaction in some ways (28) Maximizing the capacity of technology can enhance service speeds by decreasing the amount of the order-taking time by utilizing smart phone apps or handheld technology devices and gadgets, cutting down on time for food production through the usage of kitchen display, reducing service time through the usage of table management systems, shortening payment time through handheld gadgets, and minimizing turnaround time through the communications technology use (28) Better supervision over service encounters boosts customer satisfaction, and technology can bring out customers that control by offering them the choice to make option on the time they eat, by shortening their wait, or by choosing their desired table (28)

Promotion

A research from RetailMeNot indicated that coupons can impact customers’ brain chemistry and make them more contented and feel happier (29) In other words, the occasional discount can chemically make the customer happier which could lead to more satisfied customers, who are quite possible to spend more frequently in the future and can become loyal consumers (29) As stated by Promotion Marketing Association

of America, promotion activity is an imperial part of the experience of shoppers that exerts positive impacts on customer satisfaction Recent empirical studies that show promotion activities affects directly brand loyalty through customer satisfaction, which culminates in the direct impacts on brand loyalty (30) A research found showed that that the marketing on social media and price promotion impacts substantially on customer satisfaction (31) The concerted effort on promotional strategies can pave the

to restaurant (36)

High turnover rates

The correlation between employee turnover rates and customer satisfaction level has been researched in a wide range of industries It is stated by Gerson (2002) that there is

a close relationship between employee retention and higher degrees of customer satisfaction Customers are more partial to deal with the same staff over and over again (37) As discovered by Martin (1994), customer satisfaction levels in a insurance company dramatically fell from 75 to 55% when front-desk employees quit their job (15)

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Figure 3 Updated cause-effect map (Source: In-depth interview and literature review)

Poor product quality

Complaint from customer increase

High turnover rate

Sales decrease

Low customer satisfaction

Poor service quality

Poor physical environment

Low productivity

Low job

satisfaction

Low employee morale

Profit decrease

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v Discussion of central problem:

After updating the initial cause-effect map, there are some potential problem which can be the core problem leading to symptoms mentioned above An in-depth interview with the CEO of the company and a short survey were conducted to determine accurately the main problem

The CEO said that the company is more paying attention to training and coaching because they know that this practice plays an extremely vital role in enhancing competitive advantages with more skilled and well-performing employees The company has a plan that sending managerial employees to professional training courses in Ho Chi Minh city or Can Tho city to update new trend in beverage for them frequently The staffs and barista are more and more strictly selected and tested to ensure high standards of product and service because there are more qualified candidates apply to the jobs Therefore, unwell trained employee is not the key problem Additionally, management software is updated regularly to make sure that management information system works in a smooth and effective way There is no serious problem involving billing process and customer relation management, which reveals that technology does not impact negatively to the company Similarly, he thinks that marketing department work effectively because of the evidence that high reaching of the posts on social network and an increase in brand image, brand awareness which are recorded in the annual report of the company

In term of quantitative research, a questionnaire (included in appendix) consists of 10 close-ended questions completed by 60 customers who are randomly selected in three stores of the coffee chain (20 people in each store) The result shows that 83% of customers are not content with the quality of service and product they receive while a minority of them (8%, 13% and 5% respectively) dissatisfied and very dissatisfied with price, physical environment and location of the stores

More importantly, the CEO mentions that the company strategy is more concentrating

on ensuring high job satisfaction to retain qualified and skillful staffs, especially for managerial employees, because this help them to reduce recruitment cost and improve the quality of product and service considerably Furthermore, employees who are

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satisfied with their job are less likely to leave the company (38), so if we can enhance employee satisfaction, we can minimize turnover rate significantly and the cost is larger reducing

Considering reasons mentioned above, low job satisfaction is chosen to be the central problem If the company can solve this problem, employee morale and performance will be enhanced, leading to a large number of satisfied customers and the better performance of company It is discovered in a research that satisfied employees creates retention, productivity and a higher level of service quality (39) Moreover, increased job satisfaction increases customer satisfaction, which leads to better financial performance (40) Groth (2007) believes that one of the most vital assets in the attempt

to reach higher profitability is the human capital of an organization (41)

CHAPTER 2: PROBLEM JUSTIFICATION

2.1 Problem definition

The most widely used definitions of job satisfaction in literature are an attitude and behaviors which show a person’s emotional state toward his or her job or job surroundings at certain period of time or “a positive attitude toward one’s job” (42, 43) In other words, job satisfaction of employees is an effective reaction to their job

It is a set of expectations of individual and what a person receives from a job (44) According to Robbins (1996), job satisfaction is defined by as the shape and cultivation in a good general work attitude of an employee (5) In his study, it results from the difference between the rewards employees hope or believe they deserve receive and those gotten (5) Many researchers have proven that job satisfaction is the evaluations of employees about their jobs which is expressed verbally Others supposed that it is a enjoyable and positive emotional-state assessments resulting from jobs' doings (45-47) Besides, job satisfaction is regarded as the extent to which a person likes or dislikes his or her job (48, 49) that depends on the extent a person’s work environment fulfils his or her expectations, needs, values or personal characteristics (50, 51) In Motivation-Hygiene Theory (also known as Two Factors theory of motivation) proposed by Herzberg, job environment or “hygiene factors" is

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considered to be the antecedent of job dissatisfaction while job content or

"motivational factors" as the antecedent of job satisfaction (27, 43, 52, 53) In other researches, these two factors are categorized as "intrinsic" and "extrinsic" ones (52, 54) In general, researchers explore job satisfaction as a unit subject with various facets (46) In the investigation of Wanous and Lawler (1972), there are also some other technical or operational definitions are suggested with aims to measure the structure of job satisfaction (55)

2.2 Problem existence

According to Spector (1997), job satisfaction is defined as the feeling of employees toward their job (49) He also suggested nine factors affecting employee’s satisfaction including pay, promotion, supervision, fringe benefit, contingent reward, operating condition, colleagues, the nature of work and communication In other research about employee’s satisfaction in health industry, Batura et al (2016) also supposes that job satisfaction is affected by mentioned factors and it can be assessed by asking 36 statements involving in the working condition of workers (56)

Among many different methods of summation score measurement, the scale used to evaluate the degree to which employees satisfied with their jobs in this research is developed by Spector (1997), with nine dimensions measuring job satisfaction mentioned above This instrument, also known as the Job Satisfaction Survey, is a standardized survey scale used to appraise global job satisfaction and subscale categories of job satisfaction (49) Respondents were asked to make rating about their agreement with each statement on a 6-point Likert scale ranging from 1 (representing disagree very much) to 6 (representing agree very much) Each 4-questions collect data about a factor of employee satisfaction and a question (based on Single Global Rating approach) is added to access the overall satisfaction of employees Because there are both positively-worded items and negatively-worded ones, we have to score reversely for the negatively-worded items (19 questions were reversed for scoring) The construct validity of the questionnaire has been tested because the questionnaire is made up of the statements used in other studies in the literature

The population of this study consists of 50 the employees of B.O.B Coffee regarding 6

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full-time and 44 part-time ones The survey was conducted in three days in which the questionnaires were sent to email of all these employees and the response rate is 100% The table below shows the results of the research:

Table 5 Result of survey

With the aim of exploring deeper the existence of the problem, the qualitative research was carried out in which the in-depth interviews with six employees randomly selected from three store (two staff of store A, B and manager of store C) were conducted at B.O.B stores in three days and recorded by mobile phone The interview guide is constructed based on the scale developed by Spector (1997) above Four out of five interviewed staff stated that their managers do not encourage them to contribute their

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ideas and suggestions in developing the organization Moreover, managers hardly listen to their opinions, ideas in solving problem in the working process or when problems come up Also, the manager is not a good listener for staff to share their personal story as well as express their wants, opinions Another problem is managers with poor leadership skills who do not know how to inspire employees and handle conflicts between them When conflict happens among staff, the manager seems confused and meets difficulties to deal with it One of employee having conflict left the company last month because he is not content with the way of solving from the manager Working environment, is reported not healthy and positive, in which staff morale will decrease and turnover increases Interviewees provided the information that there is a lack of communication between management and subordinate Her manager is not always ready to hear from them and they can not communicate with the managers anytime they want This makes some information is missing and when there

is a problem happening, they do not know who will give them guidance and support in solving it Reversely, feedback on staff performance are hardly given to them in detail

by managers, unless it is negative Interviewed employees in store C report that their manager focuses on perfection so much that staff feel pressured because even a small mistake is made, they might be publicly berated for mistakes and subject to criticism

of their personality traits The manager often speaks loudly and one-sidedly to staff without giving them the opportunity to respond to accusations and comments She checks on employees every move, not giving them any freedom to take charge of their task In addition, she avoids delegation of decisions because she afraid of everything going wrong Therefore, when a trouble comes up, staff do not dare to solve it themselves and make decisions without asking her Also, she does not care about staff’s opinions much and she just does by her own way depending on her thinking, experience She is usually irritated when a subordinate makes decisions without consulting them Micromanagement of manager is of the reasons demotivating staffs and causing low job satisfaction As stated by four informants, their manager hardly gives staff a praise and encouragement when they do good work In other words, there

is no recognition or reward to employees who make significant and effective work contributions to the organization, which does not make them feel appreciated and

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disappointed The manager of store C shares the same opinion that the company lacks recognition or acknowledgment when manager manage well which helps the store reach high revenue and profit Additionally, an interviewee praised the opinion that reward is not perceived attractive because the criteria are too general and not informed clearly by manager or through any internal channel When they are in the dark or confused about the criteria for eligibility for the award, they are not interested in and

do not mind it This does not help to motivate employees and results in low productivity and low morale Among all interviewees, there are two people suggest that the company should increase salary in order to keep employee stay with it longer The manager of store C also shares her plan to find another job in bigger company which offers more promotion opportunities All of this highlights that employees are not highly satisfied with the company

2.3 Problem importance

v Common consequences of low job satisfaction:

According to Spector (1997), job satisfaction is crucial for two reasons: Satisfaction of employees with their job indicates equality, being deferentially treated by a company, and it can influence worker functioning as well as production (49) (57)

Employee dissatisfaction plays apart in costly labor disputes, turnover, and risk to patients (58) It is indicated that job satisfaction has a close relationship with employee performance levels which means reduced satisfaction leading to reduced organizational performance (59)

Job satisfaction and its important link with the well-being of employees has been broadly reported in previous studies (59-62) Critical relationships between these two subjects, indicating workers undergoing low job satisfaction show reduced well-being, and in specific reporting high levels of worry and unhappiness (60)

As stated by Heskett et al., (1997), unless employees are happy, customers who are served by them are happy (63) In other words, job satisfaction and employee performance powerfully linked to each other because pleased employees work more productively than productive employees who are happier (64) People have more

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incentives unless the physical and physic-social aspects are encouraging at completing their job In addition, consumers will be happier if their needs are fulfilled by inspired employees

Engagement of supervisors is extremely vital in the workplace to strengthen customer and employee satisfaction, resulting in strategic success in long-term (65, 66) A number of consequences of job satisfaction acknowledged in many studies are for instance higher employee morale and consequently increasing job performance, lower absenteeism and turnover intentions, rising employee loyalty, increasing profitability and growth and better customer satisfaction (50, 51, 67, 68)

CHAPTER 3: CAUSES VALIDATION AND SOLUTIONS

3.1 List of real causes

Table 6 Initial list of potential causes (Source: reference)

1 The work/ nature of work

The variability of the given work The job variability includes job routine, job

characteristics, and job description

Lewis, J (2014) (69)

2 Promotion

Advancement towards higher position with more challenge, authority, and responsibility

Noe, R., Hollenback, J., Gerhart, B.,

Noe, R., Hollenback, J., Gerhart, B.,

& Wright, P (2010) (70)

4 Coworkers/ People working in an Noe, R., Hollenback, J., Gerhart, B.,

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Colleagues organization (besides

supervisors) that can affect job satisfaction

& Wright, P (2010) (70)

5 Contingent

rewards

Promises and exchanges of rewards and recognition for good work

Robbins, S P., & Judge, T A (2009) (71)

6 Operating condition

Steps of finishing tasks that have to follow a certain standard based

on industry regulations, provincial laws, or personal standards It can be in form of policies, procedures, and standards

Brampton Small Business Enterprise Centre

7 Communication

Informing the current employees and job applicants of their returns on their benefits investments

Robbins, S P., & Judge, T A (2009) (71)

Pay level is described

as wages, salaries and bonuses Job structure

is described as the relative pay of jobs within the

Herzberg F., Mausner B., &

Synderman B (1959) (72)

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such environmental characteristics would

be included here

10 Fringe benefits

Financial compensations consist

of direct and indirect compensation

Nonfinancial compensations consist

of the job itself, job environment, and workplace flexibility

Mondy, R W., & Noe, R M (2005) (73)

11 Recognition

The praise employees get for doing a good job

Weiss, D., Dawis, R., England, G., & Lofquist, L (1967) (74)

12 Job security People on this job have high job security Weiss, D., Dawis, R., England, G., & Lofquist, L (1967) (74)

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Potential Causes

Validated Problem

Working conditions Fringe benefits

Recognition Job security

Complain from customer increase

High turnover rate

Sales decrease

Profit decrease

Low job satisfaction

Decreased performance

Decreased being of employee

well-Lower employee loyalty

Long-term, strategic unsuccess

Figure 4 Final cause-effect map

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v Discussion of real causes:

Based on quantitative research above, it is shown that four aspects (having mean score lower than 3) employees are not happy with are pay, promotion, supervision and contingent rewards (or recognition) Besides, qualitative research found that the topics that most respondents rated as negative generally centered on promotion, supervision, recognition and communication In term of pay, the compensation of the company is considered reasonable with a 10% increase every year, which is mostly equal to other competitors which have the same scale If there is a greater change in this subject, the company has to spend more on paying all employee It is estimated that an 20% increase in compensation results in 8% increase (equivalent

to approximately 20 million VND) in total cost Consequently, this may cause a drop in profit Regarding promotion, due to the small scale business, organizational structure is quite simple with some key positions Therefore, the promotion and career path within the organization is limited Unless the company grow bigger in the future, there are more promotion opportunities for its employees It is shown in

a research that job enrichment, employee recognition, pay equity and managerial skill have strong impact on job satisfaction of employee and bring small enterprises

an competitive advantage versus larger ones in appealing and retaining employees while maximizing their performance (75) Nevertheless, there was enough evidence to show that income was a modest factor with the very least impact in terms of non-monetary incentives Based on the context of the organization, supervision and contingent rewards (recognition) are the real causes to be solve Beside that, communication problem mentioning by interviewed employee will also be dealt with in communication plans The use of employee recognition as implemented by skilled managers and supervisors should be focused upon in order

to accomplish the company’s goal