Psychological empowerment and job satisfaction, a comparison of manufacturing and services industry in vietnam

And among these factors, the empowerment self-determination impacts the most and the empowerment competence has less impact than the others, the impact of four dimensions of psychologica

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

INDUSTRY IN VIETNAM

MASTER OF BUSINESS (Honours)

Ho Chi Minh City- Year 2015

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-Truong Ngoc Anh Thu

ID: 22120075

PSYCHOLOGICAL EMPOWERMENT AND JOB

SATISFACTION: A COMPARISON OF MANUFACTURING AND SERVICES INDUSTRY IN

VIETNAM

SUPERVISOR: Dr Tran Phuong Thao

Ho Chi Minh City- Year 2015

In this research, we can have a deep insight of overall findings for the relationshipbetween four dimensions of psychological empowerment and the employee’s jobsatisfaction In particular, that relationship was put into the comparison in twoindustries service and manufacturing To examine the research model, the surveyquestionnaires were used to circulate to employees in service companies andmanufacturing companies in Ho Chi Minh City through mail survey with the samplesize of 200 respondents This study used the SPSS Statistic to analyze the data byusing reliability analysis, exploratory factor analysis and multiple linear regressionanalysis

Some findings in this study indicated that the degree of job satisfaction may differfrom service to manufacturing but all the factors of psychological empowermentimpact on it And among these factors, the empowerment self-determination impacts

the most and the empowerment competence has less impact than the others, the

impact of four dimensions of psychological empowerment on the employees’ jobsatisfaction in service industry and manufacturing industry are not the same Inservice industry, the empowerment meaning affects on employees’ job satisfaction

stronger than in manufacturing industry The empowerment competence and

empowerment impact in this case the stronger one belongs to service industry, and inmanufacturing industry they impact slightly to employees’ job satisfaction

This study also points out some implications for management to improveemployees’ capability, productivity in their work, which can contribute todevelopment of the company

Keywords: psychological empowerment, empowerment meaning, empowerment

competence, empowerment self- determination, empowerment impact, job satisfaction, service, manufacturing.

Secondly, I would like to thank all the ISB Research Committee, the lecturers, andthe staff at International School of Business during all process of my course.

Thirdly, I would like to express my special thanks to my family and friends whoprovided continuously support, encouragement in my life

Finally, I would like to say thank you to those who participated in this study

Ho Chi Minh City, June 6, 2015TRUONG NGOC ANH THU

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TABLE OF CONTENT

ABSTRACT i

ACKNOWLEDGEMENTS ii

CHAPTER 1: INTRODUCTION 1

1.1 Background of the study 1

1.2 Research problem 3

1.3 Research objective and questions 4

1.4 Scope of the research 4

1.5 Significances of the research 5

1.6 Structure of the research 6

CHAPTER 2: LITERATURE REVIEW, HYPOTHESIS AND RESEARCH MODEL 7

2.1 Theoretical foundations 7

Models of Employee Involvement 7

Models of Empowerment 8

Theory of Motivator – Hygiene 8

2.2 Overview on psychological empowerment and job satisfaction 9

2.2.1 Psychological empowerment 9

2.2.2 Job satisfaction 11

2.3 Hypothesis development 12

2.3.1 Empowerment meaning and job satisfaction 12

2.3.2 Empowerment competence and job satisfaction 12

2.3.3 Empowerment self-determination and job satisfaction 13

2.3.4 Empowerment impact and job satisfaction 14

2.4 Research model 14

2.5 Chapter summary 15

CHAPTER 3: RESEARCH METHODOLOGY 16

3.1 Research process 16

3.2 Research design 17

3.2.1 Questionnaire design 17

3.2.2 Measurement scale 18

3.3 Pilot test 21

3.4 Main survey 22

3.5 Chapter summary 25

CHAPTER 4: EMPIRICAL RESULTS AND DISCUSSIONS 26

4.1 Preliminaries of data analysis 26

4.2 Reliability analysis 27

4.3 Exploratory Factor Analysis 29

4.4 Correlation analysis 31

4.5 Multiple Linear Regression Analysis 32

4.6 Chapter summary 43

CHAPTER 5: CONCLUSION, IMPLICATIONS AND DIRECTIONS FOR FURTHER STUDIES 44

5.1 Key findings of the thesis 44

5.2 Implications 48

5.3 Limitation and directions for further studies 50

REFERENCES 51

APPENDIX A 58

APPENDIX B 61

APPENDIX C 64

APPENDIX D 66

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LIST OF FIGURES

Figure 2 1: Conceptual framework of the study 14

Figure 3.1: Research process 17

Figure C 1: The Histogram 64

Figure C 2: The Normal P-P Plot of Regression Standardized Residual 64

Figure C 3: Scatterplot 65

LIST OF TABLES

Table 4 1 : Summary of employees’ profile 27

Table 4 2: Cronbach’s Alpha 28

Table 4 3: KMO and Barlett’s test 29

Table 4 4: Total Variance Explained 29

Table 4 5: Rotated Component Matrix 30

Table 4 6: Correlations 31

Table 4 7: Model Summary 33

Table 4 8: ANOVA 34

Table 4 9: Coefficients 34

Table 4 10: Model Summary 35

Table 4 11: Model Summary 36

Table 4 12: ANOVA 36

Table 4 13: Coefficients 36

Table 4 14: Model Summary 38

Table 4 15: ANOVA 38

Table 4 16: Coefficients 39

Table 4 17: Model Summary 39

Table 4 18: Coefficients 40

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CHAPTER 1: INTRODUCTION

This research studies factors of psychological empowerment which impacts onjob satisfaction of employees in two industries, namely service and manufacturing.This chapter provides an overview of research including research background,research problem, research objectives, scope of study, and significance of the study

In this chapter, an overall structure of the research is also suggested

1.1 Background of the study

Nowadays, in an evolving environment, organizations are working underhighly competitive context In order to survive in such a tough environment,organizations try to seek out their competitive advantages The most criticalchallenges they have to face are the need to increase productivity, enhanceorganizational capabilities, expand into global markets, develop and implement newtechnologies…, etc (Burke and Cooper, 2005)

Employee is regarded as a back bone of an organization that performs criticaltasks for the survival of the organization With the needs of changing for the growingnowadays, organizations have forced not only to develop the quality of product ofservice but also the organization capabilities, especially their employee through theirperformance However, the impact of human resources on operational systems hasoften been overlooked (Boudreau et al 2003) An empowered and committedworkforce is generally claimed to be essential for the effective functioning ofmodern organizations (Bowen et al, 1992; Sparrowe, 1995; Kirkman et al, 1999)

In organizations, empowerment means delegating responsibilities toemployees with complete confidence and trust so as to assume a more active andresponsible role This strengthens their sense of effectiveness as well as by sharingpower, information and the responsibility to manage their own work as much aspossible

There is a broad context of empowerment in many dimensions as well asperspectives Some approach by individual to proactive work orientation byincreasing employee’s performance and some can be viewed as managerial practices

to improve employee autonomy and responsibility Researchers such as Burke(1986) and Kanter (1977) have also defined empowerment in terms of job structurethe transfer of power or authority or job support structures such as the sharing ofresources and information (Blau and Alba, 1982; Hardy and Leiba O’Sullivan,1998) In these studies, empowerment is viewed from the perspective of the leader’srole in empowering employees Many others studies view empowerment asindividual task motivation (Conger and Kanungo, 1988; Thomas and Velthouse,1990) or motivation from person and environment fit relationship (Zimmerman,1990) while Randolph (1995) asserts that employee empowerment is a transfer ofpower from the employer to the employees.

Most of the literature which reviewed many perspective of empowermentconcludes that an empowered workforce will lead their organization to achieve acompetitive advantage Employee empowerment increases productivity byincreasing employee pride, self- respect and self- worth In recent studies, one of thedominant classifications of employee empowerment accepted by many researchers isgiven by Spreitzer (1995) The author defines psychological empowerment as “theintrinsic motivation manifested in meaning, competence, self-determination, andimpact, in which an employee feels able to shape his role in work and context” Theconcept is employed in a number of studies such as Avolio et al (2004), Corsun et

al (1999), Carless (2004) and Jha et al (2008)

According to Hofstede and Bond (1984), “power distance is defined as theextent in which less powerful members of organization accept that power isdistributed unequally” In Vietnam, power distance is influenced by theConfucianism, in which the ordering relationships are in the hierarchical fashion andthe behaviors in society are based on these orders, Gudykunst (2000) Taking moreresponsibility and authority always goes along with additional benefits in Vietnam.Vietnamese are quite indecisive in delegating power Being a social republic stateand high power distance, Vietnam is the country in which the power is notdistributed equally and regarded as the basic fact in society In organizations, closesupervision, fear of disagreement with supervisors, lack of trust among co-workers,

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and directed supervision are well manifested more in high power distance culturesthan in low power distance cultures.

1.2 Research problem

After becoming an official member of the World Trade Organization,Vietnam has opportunities as well as challenges to adapt with globalization trend inthe world In order to moving forward successfully, organizations in Vietnam shouldtake the advantages of not only the new technology but also improve their workforcewith high competence, empowerment and development

In the literature, many prior studies on psychological empowerment (Tsui etal., 1997; Shaw et al., 1998; Gerhart and Rynes, 2003) indicate that management ofthe organization must improve employee satisfaction and that can encourageemployees to improve the performance of their tasks and boost the level of theirwork performance, which in turn contribute to the company’s growth Hunjra et al(2011) and Bowen and Lawler (1992) found that there is association betweenpsychological empowerment and job satisfaction So it is essential to take thesefactors into account

According to Hofstede center (2010), Vietnam with the score of 70 isconsidered as high power distance country That means Vietnamese people accepthierarchical order The eldest person has the most influence In addition, hierarchycan be classified in terms of age, education level and job positions Power distanceexists not only in workplace but also in daily life In a high power distance cultures,powerful individuals strive to maintain or increase influence at the expense of lesspowerful ones, who accept and present no challenge to the status quo (Hofstede,2001) As such, understanding psychological empowerment and job satisfaction inthe Vietnamese context is crucial for the organizational development

The literature, there are many researches for psychological empowerment inWestern countries, but little empirical studies for Eastern ones especially in Vietnam,except from Thang et al (2007) who considerate the employee empowerment in

Vietnam’s firms In addition, difference from the previous studies, this researchfocuses on the comparison in the two industries service and manufacturing, whichplays decisive roles in developing the national economy According to Looney(2014), the rapid growth of manufacturing output keeps the high share ofmanufacturing in Vietnam’s GDP, while service keeps growing Hence, more than athird of Vietnam’s growth is attributed to structural change caused by themovements of labor from low productivity agriculture toward more productivemanufacturing and services (McCaig and Pavcnik 2013) As such, due to continuouschanges of the economic context in Vietnam, a study on the relationship betweenpsychological empowerment and job satisfaction is needed to investigate.

1.3 Research objective and questions

The objective of this thesis is to investigate the relationship betweenpsychological empowerment and job satisfaction Four factors of psychologicalempowerment as given by Spreitzer (1995), Thomas and Velthouse (1990) are taken

into consideration in this thesis, namely empowerment meaning, empowerment

competence, empowerment self- determination, empowerment impact

More specifically, two research questions are given as follows:

Question 1: Do the empowerment meaning, empowerment competence,

empowerment self- determination and empowerment impact affect the jobsatisfaction in Vietnam? If yes, to what extent do these above factors affect the jobsatisfaction in Vietnam?

Question 2: Is there any difference on the impacts of psychological empowerment onthe job satisfaction between the service industry and manufacture industry inVietnam?

1.4 Scope of the research

In the literature, empowerment can be classified into two main streams namelystructural empowerment and psychological empowerment (Laschinger, 2004 andThomas and Velthouse, 1990) This research only investigates the influence of four

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factors of psychological empowerment, namely empowerment meaning,

empowerment competence, empowerment self- determination, empowerment impact

towards job satisfaction instead of structural empowerment

In addition, the research only focuses on employees in organizations in theVietnamese context More specifically, this study collects data only from Ho ChiMinh City Ho Chi Minh City is selected because this is the most dynamic city inVietnam, where attracts many companies or enterprises from many kind ofindustries

To investigate the impact of four dimensions of psychological empowerment

on job satisfaction of employee in many companies in Ho Chi Minh City, themanufacturing and service industries are selected These industries are selectedbecause: services and manufacturing are increasingly important facilitators andsources of economic growth, in the next future Vietnam is expected to implementfar-reaching regulatory, administrative and economic reforms that will provide anincreasingly favorable environment for foreign providers in Vietnam and open newmarkets for Vietnamese service and manufacturing firms So the workforce has thedrastic move of employment away from agriculture toward services andmanufacturing and play more important in total labor force of Vietnam

1.5 Significances of the research

This research differs from previous studies in the following ways First, priorstudies have mainly focused on the Vietnam context Then, there have been little ofstudies which investigates the impact of employee empowerment on employeesatisfaction and their productivities in two industries service and manufacturing inVietnam, in the scope of this study it is essential to have deep insight into the fourdimensions of employee empowerment so as to identify the impact on the employeejob satisfaction as well as the company overall performance because the jobsatisfaction will increase productivity, creativity, innovative, service quality andreduce turnover rate

1.6 Structure of the research

This thesis is organized into five chapters The contents of the chapters are asfollows:

Chapter 1 presents the overview of research background, research problem,research objectives, scope of study, significance of the study and research structure

Chapter 2 focuses on the literature review, including the definition of eachconcept, rationale for hypotheses as well as proposed the conceptual model for theresearch

Chapter 3 illustrates the detailed research methodology: research process,research design, measurement of the constructs, question design and data collectionprocedure

Chapter 4 describes empirical results and discussions based on the datacollected: characteristics of the sample, analyzing the reliability and validity, testingthe assumption of regression and testing hypotheses

Chapter 5 summarizes the discussions on the research results, theoreticalcontributions, suggest for practical implications, limitations of the study arerecognized for the future researches

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CHAPTER 2: LITERATURE REVIEW, HYPOTHESIS AND RESEARCH MODEL

This chapter reviews the literature and gives an overview of what researchalready has been done, regarding the main variables mentioned in the introduction.First, theoretical foundations are discussed to gain a better understanding of thisunknown concept Second, an overview of on psychological empowerment and jobsatisfaction is outlined Third, the dependent variable and independent variableperformance are described in hypothesis development Finally, the conceptual modelwill be presented together with the hypotheses

2.1 Theoretical foundations

Models of Employee Involvement

The concept of employee empowerment came from the concept of “Employeeevolvement” which was defined by Lawler and Mohrman (1989) In this concept,information, influence and incentives are required to access for employees A Model

of Employee Involvement was developed by Lowin (1968), Saskin (1976), Locke(1979) and Leana (1987) etc Lowin (1968) present a model that the effectiveness ofinvolvement depends on the personalities and attitudes of those who involved, theextent, importance, the quality of the participation process, and visibility of theissues Saskin (1976) defined a model that focuses on the psychological target of theEmployee Involvement with four types as: goal setting, decision making, problemsolving and change Locke and Schweiger (1979) presented a model of theparticipation process which differentiated between cognitive effects and motivationaleffects Leana (1987) differentiated between employee participation and delegation,which emphasized giving employees more involvement, autonomy and participation

in decision making

Models of Empowerment

The concept of empowerment began with a five stage model of empowerment byConger and Kanungo (1988) In this model, the experience of empowerment comesfrom the self sufficiency and confidence by using of participative management, jobenrichment There are some other previous models by Lowin (1968) who focused onattitudes about the process, Saskin (1976) who studied on commitment to change.From those concepts and models, empowerment was developed as a concept,philosophy, an organizational program, and set of organizational behavioral practices

by Ripley and Ripley (1992) Ripley and Ripley (1992) focused on grantingauthorization and drawing company vision As a concept: Empowerment isproviding with power and authority to make decision As a philosophy andbehavioral practices: team can manage itself and individuals can follow theirassignment with personal orient, while company and personal goals toward theshared company vision As an organizational program: giving the workforcepermission basing on the provided framework in order to pursue, develop their skillsand broaden their knowledge to contribute to the organization as well as themselves.Different aspects of the employee or organization interaction, the nature of theenvironment, market, product, the technology involved in organization were focused

in different models above So organization can approach to empowerment by using asuitable definition and can take the advantage of its own market, challenges andopportunities

A unifying model is emerging which allows for such different approaches Theempowerment model starts with the need to change driven by external forces such ascompetitiveness, globalization and the introduction of the advanced technology Theempowered organization in which high performance employees are born willincrease in its efficiency and productivity

Theory of Motivator – Hygiene

This theory is developed by Herzberg et al (1959) According to them there aremany factors at any workplace that are related to the job satisfaction or job

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dissatisfaction The factors that are related to the job satisfaction are regarded as

"motivators" and the factors which results in job dissatisfaction are known as

"hygiene" Herzberg et al (1959) indicated these factors are regards as Motivators:work itself, recognition, achievement, responsibility, advancement The Hygienefactors are including: salary, supervision, policy and administration, workingconditions, interpersonal relations Herzberg et al (1959) identified these factors buttheir description in the scenario of education is provided by the Padilla-Veles (1993).Theory of Motivator – Hygiene by Herzberg et al (1959) is one of the theories tostudy job satisfaction There are two other theories: Discrepancy theory waspresented by the Locke (1969) and Equity theory was developed by Mowday (1992)

A review of these above theories of job satisfaction could be found in the studies bySiddiqui and Saba (2013)

2.2 Overview on psychological empowerment and job satisfaction

2.2.1 Psychological empowerment

In the literature, there are several definitions on the empowerment.Specifically, Newstrom and Davies (1998) define empowerment as process thatprovides greater autonomy by sharing of relevant information and control overfactors affecting job performance while Zimmerman (1990) viewed empowermentwith reference to behavior or performance related outcomes Empowerment has alsobeen described as dependent on management or leadership actions (Bennis andNanus, 1985; Block, 1987) and human resource practices (Conger and Kanungo,1988; Lawler, 1986)

It could be seen that there are two types of empowerment: structuralempowerment and psychological empowerment (Laschinger, 2004, Spreitzer, 1995;Thomas and Velthouse, 1990) Specifically, structural empowerment is limited to theworkplace conditions; it depends on the perceived actual conditions of empowermentwithin the workplace It is mainly about the empowering of management/work

practices, delegation of decision rights from high level employee to theirsubordinates and giving employees access to needed information or diverseresources to accomplish tasks autonomously Another type of empowerment,psychological empowerment, is focused on employee mainly It is the reaction ofemployees to structural empowering conditions Therefore, this type ofempowerment is referred to as increased intrinsic task motivation, with fourdimensions which reflects the individual’s orientation to his or her work role.

Spreitzer (1995) defines psychological empowerment as “the intrinsicmotivation manifested in meaning, competence, self-determination, and impact, inwhich an employee feels able to shape his role in work and context” Recent studiesshows that psychological empowerment is becoming a concern of many researcherssuch as Avolio et al (2004), Corsun et al (1999), Carless (2004), Jha et al (2008)etc So in this study applies the definition of Spreitzer (1995) including four types ofempowerment as follows:

- Meaning: involves a fit between requirements of a work role and beliefs values, and behaviour

- Competence: is an individual’s belief in his or her capability to perform ajob well

- Self- determination: the feeling of having choice in initiating and regulating behaviour

- Impact: the belief that individual can influence over strategic, administrative

or operational outcomes at work

The theory supported for the empowerment is developed by severalresearchers Specifically, the theory came from the concept of “Employee

evolvement” which was defined by Lawler and Mohrman (1989) In this concept,information, influence and incentives are the combination of employees A Model ofEmployee Involvement was developed by Lowin (1968), Saskin (1976), Locke(1979) and Leana (1987) etc which emphasized giving employees moreinvolvement, autonomy and participation in decision making Coming after that

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model, some researchers who address some concepts of empowerment in Model ofEmpowerment such as Conger and Kanungo (1988), Ripley and Ripley (1992) etc.

2.2.2 Job satisfaction

There is an increasing attention for job satisfaction theme in the literature Jobsatisfaction is defined as the feelings an employee has about the job in general(Smith et al 1975) or as an individual’s positive or negative attitude towards theirjob (Wollack et al 1971) Robbins and Judge (2007) defined job satisfaction as apositive feeling about one’s job based on evaluation of the characteristics Georgeand Jones (2008) define job satisfaction as “the feelings a worker has about his job.Thus, it could be concluded that job satisfaction is the pleasure of employees whenhe/she have positive feeling about the jobs

There are a number of specific facets of satisfaction related to pay, work,supervision, professional opportunities, benefits, organizational practices andrelationships with coworkers (Misener et al 1996) A review of prior study showed astrong correlation between turnover and negative feelings about the job Herzberget

al (1957) Research has shown that attitudes about one's job influence the way thejob is done (Herzberg 1959) Conversely, studies have reported a positive correlationbetween negative feelings about the job and turnover (Robbins 1979) and a strongpositive correlation among initial lateness, then absence and subsequent turnover(Rosse 1988) Employee satisfaction (and customer satisfaction) was also found toimpact changes in sales by Keiningham et al (2006) Job dissatisfaction leads toabsenteeism, problems of grievances, low morale and high turnover (Gangadhraiah

et al 1990, Martin 1990)

Many studies have found that employee satisfaction is a strong determinant oforganizational commitment and loyalty (MatzlerSRenzl 2006; Mak Sockel 2001;Martensen and Gronholdt 2001), negatively related to turnover (Tekleab et al 2005;Ward 1988) and absenteeism (Muchinsky 1977)

There are numerous of theories related to job satisfaction which can help tounderstand more about it such as Theory of Discrepancy by Locke (1969), Theory

of Equity by Mowday (1992), Theory of Motivator - Hygiene by Herzberg et al.(1959) A review of the theories could be found in the studies by Siddiqui and Saba(2013).

2.3 Hypothesis development

2.3.1 Empowerment meaning and job satisfaction

In the research of Thomas and Velthouse (1990), empowerment meaningconcerns the value of the task or purpose which has the relationship to theemployees’ ideas, their beliefs or their standards Spreitzer et al (1997) indicated thefit relationship between the employees’ needs in the job and their own values, theirbeliefs and their behaviors Empowerment meaning has been linked to worksatisfaction by previous research (Hackman and Oldham 1980; Spreitzer et al.,1997) And from these researches empowerment meaning among the otherdimension can directly present the relation between the person and the job, that is,the fit between the job role requirements and the employee’s beliefs and values Anemployee does not feel enthusiastic about the job if he/she does not get energizedabout work, an employee will not feel empowered (Thomas and Velthouse, 1990)

Literature shows that a positive relationship is found between meaning andjob satisfaction (Spreitzer, Kizilos and Nason, 1997; Hackman and Oldham, 1980;Bennis and Nanus, 1985) If work is more meaningful for a person it will lead tomore satisfaction with his or her work which will result in an increase in employeesatisfaction Whereas low levels of meaningful work will lead to lower levels ofwork satisfaction We can formulate the following hypothesis

Hypothesis 1 (H1): Empowerment meaning is positively related to job

satisfaction

2.3.2 Empowerment competence and job satisfaction

According to Thomas and Velthouse (1990), empowerment competence, orsometimes understood as self-efficacy, is the degree a person beliefs he or she can

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skillfully perform a set of task or activities when he or she tries A person will feelmore satisfied with his work when he feels more competent about their work.

Although limited research is done on the relationship between empowermentcompetence and performance, Spreitzer et al (1997) found a positive relationshipbetween competence and productivity Locke (1991) indicated that self-efficacy has

a powerful impact on task performance Multiple empirical studies reviewed by Gistand Mitchell (1992), report a positive relationship between self-efficacy and avariety of work-related performance measures, such as sales and researchproductivity and adaptability Thus it is expect that empowerment competence ispositively related to employee satisfaction

Hypothesis 2 (H2): Empowerment competence is positively related to job

satisfaction

2.3.3 Empowerment self-determination and job satisfaction

Hackman (1987), and Susman (1976) defined empowerment determination is the degree to which employees experience freedom, independence,and discretion within the organization while (Deci, Connell, and Ryan, 1989)defined self-determination as the ability that an individual has a choice to performworks by themselves It enables an employee, not only delegate tasks to theemployee By enabling, which can heighten intrinsic motivation throughdevelopment of personal efficiency, an employee will feel motivated (Conger andKanungo, 1988) In addition, according to (Spreitzer et al 1997; Wagner 1995),empowerment self-determination refers to the belief that one has autonomy orcontrol over how one does his or her tasks at work So self-determination consists ofthe sense of personal control and causal responsibility for ones actions (Thomas enVelthouse 1990) Individuals who experience more autonomy in their work arelikely to get more intrinsic rewards from their work (Thomas en Velthouse 1990)and thus be more satisfied employees This leads to the following hypothesis:

self-Hypothesis 3 (H3): Empowerment self-determination is positively related to

job satisfaction

2.3.4 Empowerment impact and job satisfaction

According to Spreitzer et al (1997), empowerment impact is the perceptionthat one, as an individual, can influence strategic, administrative or operatingoutcomes at work This dimension of empowerment is positively related toeffectiveness While Ashfort (1989) considers empowerment impact as the degree towhich one is able to influence administrative, operating, or strategic outcomes atwork to make a difference This leads to the following hypothesis

Hypothesis 4 (H4): Empowerment impact is positively related to job

satisfaction

2.4 Research model

Based on the above discussion, the research model presenting the relationshipbetween the psychological empowerment factors on job satisfaction in service andmanufacturing industry is suggested as follow:

Accordingly, four hypotheses are suggested, including

Hypothesis 1: Empowerment meaning is positively related to job satisfaction.Hypothesis 2: Empowerment competence is positively related to jobsatisfaction

Hypothesis 3: Empowerment self-determination is positively related to jobsatisfaction

Hypothesis 4: Empowerment impact is positively related to job satisfaction

CHAPTER 3: RESEARCH METHODOLOGY

This chapter describes the detailed research methodology applied for theconduction of this study The chapter examines from the objectives of the study, thetechniques used to conduct the research, as well as the design of the questions,sample, the data collection procedure and the data analysis method Moreover,justification of each choice of method made regarding the mentioned objectives areincluded, in order for the research design to be supported In the following sections,this research describes our research method containing pilot study and main survey

to approach to a better understanding of four dimensions of psychologicalempowerment affecting on job satisfaction

3.1 Research process

The thesis investigates the relationship between the four dimensions ofpsychological empowerment and the job satisfaction of employees in Vietnam and inparticular how the differences on the effect of psychological empowerment on thejob satisfaction between the service industry and manufacture industry in Vietnamare To achieve this objective, the thesis process covers several stages includingliterature review, research design, pilot test, main survey and data analysis which areillustrated in the below process After formulating research problem, and basing onthe literature review on this theme, identifies the models after developing ofhypothesis and research question Then we have research design by indicatingquestionnaire design and measurement scales After that the pilot test is conducted.Finally the quantitative research in the main survey to collect data for testing themodel

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Formulating Research problem

Literature Review

Development of hypothesis, Research questions

Research design

Questionnaire designMeasurement scale

Pilot testMain survey

Data analysis

Descriptive StatisticsReliability analysisExploratory Factor AnalysisCorrelation analysisTesting of Hypotheses (Multiple Linear

Regression Analysis

Conclusions & Implications

Figure 3.1: Research process

3.2 Research design

3.2.1 Questionnaire design

The questionnaire is divided into seven parts: personal information,empowerment meaning, empowerment competence, empowerment self -determination, empowerment impact, employee satisfaction and productivity The 5-point Likert scales, which are rating scales widely used for asking respondents’

attitudes, are utilized to ask the employee to evaluate the degrees of their agreementwith the impacts of four dimensions of employee empowerment on their satisfaction

as well as productivities The 5 points in the scale are respectively from 1 to 5scoring: strongly disagree, disagree, neutral, agree, and strongly agree Thequestionnaire is initially prepared in English and then translated into Vietnamese by

an academic fluent in both languages This procedure is undertaken because English

is not well understood by all employees in Vietnam Translation is undertaken toensure the respondents can understand the meanings

3.2.2 Measurements:

The questionnaire is mentioned into four dimensions: empowerment meaning,

empowerment competence, empowerment self- determination, empowerment impact

influencing job satisfaction Spreitzer's (1995) scales are used to measure theseabove components of psychological empowerment

Empowerment meaning

The meaning items were taken directly from Tymon (1988) To measure theempowerment meaning, the study adapt the measurement given by Dimitriades(2005), Cyboran (2005), Menon (1999) who suggest two questions based on theLikert - type scale from 1 = "strongly disagree" to 5 = "strongly agree" scale Thequestions are as follows:

Variables

2 Empowerment EM2 The work I do is meaningful to me

meaning

me personally

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Empowerment competence

The competence items were adapted from Jones's (1986) self-efficacy scale

To measure the empowerment competence, the study adapt the measurement given

by Dimitriades (2005), Cyboran (2005), Menon (1999) who suggest three questionsbased on the Likert - type scale from 1 = "strongly disagree" to 5 = "strongly agree"scale The questions are as follows:

perform my work activities

job

Empowerment Self- determination

The self-determination items were adapted from Hackman and Oldham's(1980) autonomy scale To measure the empowerment self- determination, the studyadapt the measurement given by Dimitriades (2005), Cyboran (2005), Menon (1999)who suggest three questions based on the Likert - type scale from 1 = "stronglydisagree" to 5 = "strongly agree" scale The questions are as follows:

No Construct Coding of Item

Variables

how I do my job

2 Empowerment ESD2 I can decide on my own how to go about

determination

independence and freedom in how I do myjob

Empowerment impact

The impact items were adapted from Ashforth's (1989) helplessness scale Tomeasure the empowerment impact, the study adapt the measurement given byDimitriades (2005), Cyboran (2005), Menon (1999) who suggest three questionsbased on the Likert - type scale from 1 = "strongly disagree" to 5 = "strongly agree"scale The questions are as follows:

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No Construct Coding of Item

Variables

friend if he/she were looking for a job

- Interviewing some experts from two kinds of industries: twelve experts fromservice companies and eight experts in manufacturing companies to find out any mistakes

2 Empowerment EC1 I do not have enough confidence in my

3 Empowerment ESD1 I do not have enough autonomy inSelf- determination determining how I do my job

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The results of the pilot test show that the reliability and the result are good, all thevariables are acceptable So there is not any more change in research model Moredetails could be seen in Appendix D.

3.4 Main survey

3.4.1 Sampling

We formulate our research framework base on the review of the existingliterature We design questionnaires consisting of a number of question items tocollect data on relationship between dimensions of empowerment and employeesatisfaction, between employee satisfaction and productivities Minimum samplesize used in statistics analysis should be equal to or greater than five times of thenumber of independent variables, but not less than 100 to generate reliable results: n

≥ 100 and n ≥ 5k (where k is the number of items) This research has 16 items, as aresult, the minimum sample size required is: n = 5 x 16 = 80 The minimum samplesize in case of multiple regressions should be: n = 50+8m (where m is the number ofindependent variables) Apply this research with this formula for 4 independentvariables, we have the minimum sample size for multiple regression: n = 50 + 8 x 4

= 82 This research needs 82 samples at least With quantitative approach, in order toincrease the reliability and validity, the initial target sample size for this research wasabout two hundreds of employees in two industries service and manufacturing A total of

200 questionnaire forms will be circulated to employees who are working in servicecompanies and manufacturing companies in Ho Chi Minh City through mail surveymethod To control the potential for varied interpretation of question wording and thestudy was intended, a pilot study was undertaken to ensure maximum clarity The mailsurvey and online survey are the methods of choice because they are relatively inexpensive

to administer; they allow for large numbers of respondents to be surveyed in a relativelyshort period; respondents can take their time in answering, and privacy is easier tomaintain (Mangione, 1995) There are 185 participants answered the questionnairesthrough email and 165 questionnaires are used to analyze

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3.4.2 Data analysis method

After finishing the data collection, the process of data analysis is conducted Allaccepted questionnaires will be reviewed for validity and completion Reverse-scoring negatively-keyed items must be implemented before computing individuals’total scores and before conducting data analyses We do this so that high scores onthe questionnaire reflect relatively high levels of the attribute being measured by thequestionnaire This study used the IBM SPSS Statistic version 20 to analyze the data.Data processing procedures used in this study are summarized as followings:

Test for reliability

The Cronbach’s Alpha is the most widely used objective measure ofreliability of the scale Cronbach’s Alpha is a statistical test if the correlation of theitems in the scale is relative to each other Consequently, this method of analysis canremove inappropriate variables and limit junk variables in the study process andevaluate the reliability of the scale through the Cronbach’s Alpha coefficient (Hair etal., 1998) According to Pallant (2001), the scales are reliable when Cronbach’sAlpha coefficient of each scale is equal to or higher than 0.7 A low value of alphacould be due to a low number of questions, poor interrelatedness between items orheterogeneous constructs

Test for validity

Exploratory Factor Analysis (EFA) was conducted to test the number of factorsextracted to explore the relationship between independent variables Factor analysis is amultivariate statistical technique which defines the underlying structure among a largenumber of variables (Hair et al., 1998) The two fundamental purposes of factor analysisare to summarize the information contained in a large number of variables and condensethe data into smaller number of factors (Hair et al., 1998) In the study, there were fourfactors that were assumed to have influence on employee’s job satisfaction Factoranalysis was used to create factors for each of the four measuring scale related Inaddition, factor analysis assisted the researcher to

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determine which factors were highly correlated to employee’s job satisfaction.According to Pallant (2001), Factor analysis is appropriate for data if it satisfies thefollowings:

The Kaiser-Meyer-Olkin value (KMO) is 0.6 or greater

The Bartlett’s test of inadequate is statistically significant: p < 0.05

The transmission coefficient variables (factors loading) is less than 0.5 or thedifference between the two factors less than 0.3 will be disqualified

Stops Eigenvalue (representing the variance explained by each factor) greater than 1and the total variance extracted (Cumulative% Extraction Sum of Squared loadings)greater than 50%

Test for the relationship of variables

Pearson’s correlation coefficient was used to examine the relationshipsbetween two or more research variables If the value of correlation coefficient is 1.0,then there is a perfect positive correlation between two variables In contrast, if thevalue of correlation coefficient is -1.0, it can be concluded that there is a perfectnegative correlation between two variables In addition, there is no relationshipbetween two variables if the value of correlation coefficient is zero

Test of Hypothesis: Multiple regressions

- Test for the regression assumptions: When choosing to analyze the data usingmultiple regression, we must checking to make sure that the data for analyzing canactually be analyzed using multiple regression So if the data passes these assumptionsthat are required for multiple regressions, it can give a valid result, and we are ready touse multiple regressions

- Show the regression models for entire group and two separate groups: Multipleregression analysis is a statistical technique that is used to analyze the relationshipbetween several independent variables and a single dependent variable (Hair et al

1998) It was used to examine the simultaneous effects of several independentvariables on a dependent variable In this study, Multiple Linear Regression methodwas used to test the research model and hypotheses Two separate groupshierarchical multiple regression analyses were performed to test interaction effects ofindependent variables and the moderator in two indutries Pallant (2001) explains theconditions to accept the result are:

The sample size is: n > 50 + 8m (where m is the number of independent variables)

We also use R-square value to express how much of the variance in the dependentvariable was explained by the model

3.5 Chapter summary

This chapter illustrates the detailed research methodology that used to test thehypothesis given in the chapter 2 They are including: research process, researchdesign, measurement of the constructs, question design and data collectionprocedure, data analysis methods Questionnaires were distributed to respondentsthrough email or directly The pilot test was also mentioned in this chapter with theresult of accept all the items to ensure that they could be used in the main survey All

of the methods in this chapter will be applied by data collected in the main surveyand demonstrated the results in chapter 4

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CHAPTER 4: EMPIRICAL RESULTS AND

DISCUSSIONS

This chapter describes empirical results and discussions based on the datacollected which including: characteristics of the sample, analyzing the reliability andvalidity, testing the assumption of regression and testing hypotheses Data extractedfrom the questionnaires were statistically analyzed with the method mentioned in theprevious chapter using the SPSS software Detailed analysis of the results derivedfrom this analysis towards the objectives of the research is presented in this chapter

4.1 Preliminaries of data analysis

The main survey was conducted with the total 200 questionnaires weredelivered to three service companies and three manufacturing companies in Ho chiMinh City by email There are 185 participants answered and 165 questionnaires areused to analyze

Participants in this survey vary in terms of ages, genders, education level,average years at company, organizational role and from two kinds of company:service and manufacturing In summary employees’ profile, female is 53.9% andmale is 46.1% The major group of age is from 18- 25 years (52.1%), following bythe group of 26 – 35 years (40.6%) Most of the employees are bachelor (69.7%),followed by the master degree (13.9%) The majority of the group is who works atthe company from 3 to 5 years (32.1%), followed by 29.1 % working from 1 - 2years Most of the employees are staff at company (61.8%), followed by professionalemployees who are expert in their major and in higher levels than staffs (27.3%).The other organizational role which is consisted of leaders or supervisors or anyothers role in organization have the minority percentage of the group (4.2%) Themajority of the employees are in service (53.9%), and in manufacturing is 46.1%

Table 4 1 : Summary of employees’ profile

greater than 0.7, this can be considered an acceptable reliability In this research,items with Cronbach’s Alpha coefficient less than 0.7 and corrected item-total

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correlation lower than 0.30 would be deleted Cronbach’s Alpha coefficients of allfactors in this research satisfied the requirement because they are greater than 0.7,ranging from 0.796 to 0.841.

Table 4 2: Cronbach’s Alpha

Item-Total Statistics Reliability Statistics

JS3 10.60 8.229 752 767

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