The impact of human resources management to employees job satisfaction within interior design and construction industry in vietnam , luận văn thạc sĩ

---THE IMPACT OF HUMAN RESOURCES MANAGEMENT TO EMPLOYEE’S JOB SATISFACTION WITHIN INTERIOR DESIGN AND CONSTRUCTION INDUSTRY IN VIETNAM MASTER OF BUSINESS ADMINISTRATION THESIS Ho Chi Min

-THE IMPACT OF HUMAN RESOURCES MANAGEMENT TO EMPLOYEE’S JOB SATISFACTION WITHIN INTERIOR DESIGN AND CONSTRUCTION INDUSTRY IN VIETNAM

MASTER OF BUSINESS ADMINISTRATION THESIS

Ho Chi Minh City – 2012

My name is Hoang Tu Ngoc, author of this MBA thesis I would guarantee that this is my own research and has not been published in any previous studies.

I am fully responsible for above commitment

Student

Hoang Tu Ngoc

Major: Business Administration

Major Code: 60.34.05

supervisor, Dr Tran Ha Minh Quan for his intensive support, valuable suggestions, guidance,and encouragement during the course of my study.

I would like to thank many of my colleagues at TTT and friends from other companies ininterior design and construction area who helped me during the data collection stage

I would like to express my sincere gratitude to all of my tutors at Faculty of BusinessAdministration and Postgraduate Faculty, University of Economics Ho Chi Minh City for theirteaching and guidance during my MBA course

I would like to specially express my thanks to all of my classmates, my friends from for their support and encouragement

Hoang Tu Ngoc

Ho Chi Minh City, May 2012

In development of business, human resources management is understood as employeeswho are working in company and they play an important part of organization It is safe

to say that the impact of human resource management is a crucial influence on the jobsatisfaction of employees and thus affects their performance during working period Theresearch on these effects is essential for every business

Based on the model study of Petrescu & Simmons (2008) regarding the impact of humanresources management to the job satisfaction of employees, the aim of this research is toexplore the practical impact of human resource management to the job satisfaction ofemployees in interior designer and construction industry in Vietnam Following the result of this research, companies in industry are able to improve the effectiveness of the human resourcesmanagement

Keywords: human resource management, employee’s job satisfaction, teamwork, supervision, recruitment and selection, training and learning, employee involvement, payment.

1.2 Interior design and construction industry in Vietnam within the research topic 2

1.2.1 General information 2

1.2.2 Selection of featured companies to study 3

1.2.3 Organizational chart in interior design and construction company 4

1.2.4 The work of human resources management 6

1.2.5 The particularities of the interior design and construction industry and its influence on Human resources management 6

1.3 Research purposes 7

1.4 The scope and subject of study 8

1.4.1 Scope of study 8

1.4.2 Subjects of study 8

1.5 The significance of research 8

1.6 Research Methods 9

1.7 Research structure 9

2 CHAPTER 2 | LITERATURE REVIEW 10

2.1 The theory of human resources 10

2.2 The theory of human resource management 10

2.2.1 Definition 10

2.2.2 The difference between Personnel management and Human resource management 11

2.2.3 Characteristic of human resource management 13

2.2.4 The model of human resource management 13

2.3 Analysis on employee’s job satisfaction 19

2.4 Research model 20

2.5 Summary of Chapter 2 22

3 CHAPTER 3 | METHODOLOGY 23

3.1 Research Methods 23

3.1.1 Preliminary study 23

3.1.2 Formal research 23

3.2 Method of data processing 24

3.2.1 Inspection by the scale factor Croncbach Alpha 24

3.2.2 Exploratory factor analysis EFA 24

3.2.3 Regression analysis and ANOVA analysis 24

3.3 Methodology 25

3.3.1 Surveyor 25

3.3.2 Method of surveying 25

3.3.3 Size and method of sample choosing 25

3.4 Scale adjustment 26

3.4.1 Process of scale adjustment 26

3.4.2 Qualitative research 26

3.4.3 Quantitative research 26

3.4.4 Scale of human resource management in interior design and construction industry 27

3.4.5 Scale for job satisfaction of employees 30

3.5 Summary of Chapter 3 30

4 CHAPTER 4 | RESULT OF RESEARCH 31

4.1 Sample description: 31

4.2 Preliminary evaluation scale with Cronbach Alpha 32

4.2.1 Testing the reliability of the independent variable 32

4.2.2 Testing the reliability of the dependent variable 36

4.3 Scale testing by using Exploratory Factor Analysis (EFA) 37

4.3.1 Factor analysis for Independent variable 37

4.3.2 Factor analysis Dependent variable 40

4.4 Regression Analysis 41

4.5 The results of comparison of human resources management based on characteristics of study components 46

4.5.1 By Gender 46

4.5.2 By Age 48

4.5.3 By Years of experience 49

4.5.4 By Education level 50

4.6 Results 51

4.7 Summary of chapter 4 53

5 CHAPTER 5 | CONCLUSION AND SUGGESTION 55

5.1 Introduction 55

5.2 The significance of the study 56

5.3 Proposal for solution of human resource management practices 56

5.3.1 Solution for Payment 56

5.3.2 Solution for Training 56

5.3.3 Solution for Supervision 57

5.4 Limitations and Recommendation for further research 57

5.4.1 Limitations 57

5.4.2 Recommendation for further research 57

6 REFERENCES 58

6.1 Vietnamese sources 58

6.2 English sources 58

7 APPENDIX 1 | CONTENT OF GROUP DISCUSSION 62

8 APPENDIX 2 | QUESTIONARES 65

9 APPENDIX 3 | VARIABLES AND SYMBOLS 68

10 APPENDIX 4 | CRONBACH ALPHA ANALYSIS 70

11 APPENDIX 5 | EXPLORATORY FACTOR ANALYSIS (EFA) 77

12 APPENDIX 6 | LINEAR REGRESSION ANALYSIS 84

13 APPENDIX 7 | ABBREVIATION, TERMINOLOGY AND LIST OF COMPANIES 86

1 CHAPTER 1 | INTRODUCTION

1.1 Reason for choosing the research

Human resources management has always been considered as one of the most importantdepartment amongst resources of a company The quality of human resources plays a keyrole to the success or failure of a business, particularly in the context of the open economy

in Vietnam and global competition nowadays

During last consecutive years, Vietnam’s economy has been growing with a rapid pace andsustainable development In the late 1980s, when the renovation policies were adopted,Vietnam market became attractive for foreign trade and investment, and private economicactivity were legal (Glewwe, 2002) Due to establishment of new companies in Vietnam,demand for office space develops increasingly significant in Ho Chi Minh – the biggestcity Following this growth, interior design (1) and construction companies were born toprovide the high quality services in fitou t works (2) Working in human resourcemanagement of this industry for years, I would apply my experience into a formal research

in order to prepare depth knowledge for further development

Interior design and construction is a narrow specialization of construction area Scope ofservices includes the final stage to complete the construction tasks inside a building Thereare two type of company which provides this service (a) One is specialized in designingonly (b) Another one provides fully stages from interior architectural design to build andcomplete fitout works This research wil l study on type (b) – a larger organization – whichprovides and focuses on high value contracts such as high class office, hotel or resorts from

4 stars standard

In order to work in this industry, employees are required to have high level of skills in bothaesthetic and technical However, it can be seen the lacking of high education of interiordesign and construction field in Vietnam, therefore employees need to explore theirexperience through practical working In many cases, when company, or human resourcesmanagement, can provide employees chances to enhance their experiences and

performances in job, this matter has positive impact on employee’s job satisfaction It can

be seen that human resources management is considered as a connection betweenemployees and company and in charge of employee’s job satisfaction

Without a wellorganized system, most of interior d esign and construction companies areonly running to meet the immediate needs of market, instead of working with a stabledevelopment In fact, the practices of human resources management focus on solving thosedaily tasks rather than planning for a longt erm strategy That leads to the need of preparing

a specific research on human resource management, which based on an appropriatemethodology

Starting with the research question “The impact of human resource management to theemployee’s job satisfaction within interior design and construction industry in Vietnam”,this study attempts to inform and clarify on what and how factors could create satisfaction

in current job for employers through the tool of human resource management

1.2 Interior design and construction industry in Vietnam within the research topic

1.2.1 General information

As discussed above, this research focuses on interior design and construction industry inVietnam within large project group only such as highclass office (3) and hotel, resort, whichare invested by large companies and organizations This group has the highest fund in themarket segment nowadays and is known as a potential market for interior design andconstruction companies The scope of services provides: architecture interior design,mechanical and electrical (M&E) engineering building services, supply and installation offurniture, Fitout works

It can be said this is a difficult area for companies that want to provide these servicesbecause it requires a huge investments, especially furniture manufacturing Also nextstruggle is to have the high quality of human resources in design works, projectmanagement, and construction management and so on This research will select, introduce,and analyze a group of leading companies that represent for Vietnam

1.2.2 Selection of featured companies to study

Based on Vietnam market research of CBRE (2012) (6) in construction and real estatearea, the research figures out a list of biggest companies in size and years ofestablishment within interior design and construction industry in Vietnam, collectsdata and studies organization of these selected companies They are:

Founded in 1990, AA Corporation has 22 years of development AA focuses ondesign and build for high class projects, especially hotel and resort They alsoexports furniture to foreign countries with large sales through the bidding process.With about 600 staff and 1,400 workers, AA Corporation is known as a biggestcompany in the market

Founded in 1992, TTT Corporation has 20 years of development They focus onoffice design and build which is the biggest strengths that no company can gainsignificant market share as of TTT Recently in 2005, TTT Corporation alsoextends to hotel and resort projects In the judgment of market research company,TTT occupies nearly 50% market of Class A and B office design and build in HoChi Minh City The total staff of TTT is now around 290 people and 700 workers

Besides TTT Corporation and AA Corporation, a variety of companies in theinterior design and construction industry in the market These companies havehistorically formed and developed over 10 years, many of them are formed fromstaff who had worked for TTT Corporation and AA Corporation They established

a new business after leaving, such as companies named Happy Land

(7)

, Saigon Xanh (8), AAH (9), and others

1.2.3 Organizational chart in interior design and construction company

When a new company established, the critical and basis departments will includehuman resources management, administrative, accounting, marketing, andinformation technology (IT) However in the field of interior design andconstruction, some unique departments are formed with their own characteristics

to be able to meet the specialized needs of business For example, the departments

of project management, estimation, design, and construction management.Discovering a schematic diagram of the complex organization such as TTTCorporation, this has outstanding properties through a matrix operation (Figure 1):

Figure 1: The matrix Diagram of the organizational structure of TTT Corporation.

Functional groups along the project tasks:

Sales department: dealing and signing contracts with clients Statistics and reports

on business, market share, and competitors Contact with clients and implementstrategies to expand the market

Design department: design as customer’s requirements, and timely adjustments ifconstruction drawing is difference

Estimating department: research and provide cost estimates of works, proposeprice for construction works to customers

Purchasing Department: material supply, is responsible for purchasing materialsand equipment for production and business activities of companies; marketresearch materials, and imported materials, price calculation, control quality ofpurchasing materials, ensuring the quality of production’s requirements

Production department: to produce and supply of furniture as required by interiorworks

Construction department: construction done by an interior that the customer hasselected To organize the supervision of construction process, to ensure qualityand progress of customer requests from initiation to delivery of the project

After Sales Service (ASS) department: is responsible for warranty, maintenance

of the interior works,

Project management department: throughout the process of managing customerprojects after the contract was signed Responsible for monitoring throughout theproject schedule, construction quality, work directly with customers, solve anyquestions, complaints, or customer requirements Final settlement amount withthe customer and complete the payment process

1.2.4 The work of human resources management

Historical development of companies in the industry is always associated withthe development of human resources management to follow in both quantity andquality requirements During their operation, the companies have always focused

on human resources management which has a crucial role to the success orfailure of the business, especially in a very specific market such as interiordesign and construction With that reason, the company should focus more onhuman resource management so that longterm effectiveness and planning musttake into account human resource development to meet the need of companies inthe future Overall, the current leading company in interior design andconstruction has formed and has a human resources management system relative

to its own basic daily operation System personnel policy has been established,recruitment process and candidate selection has been established, and the systemcapacity assessment and paid workers also built based on specific characteristics

of each company and depends on the changes in the external labor market

However, in the management of human resources of companies also exist someshortcomings have not been solved:

Human resources practices are for daily operations rather than longterm system and sustainable development

The human resource planning has not been doing well Education and training staff has not been focused and invested into longt erm strategy

1.2.5 The particularities of the interior design and construction industry and its influence on Human resources management

Interior design and construction operation in Vietnam is growing fast from thelast 10 years. Demand for human resources with high quality, including designand construction is always concerned for the company. But to meet the needs of

human resources with high quality, the system of education Colleges andUniversities in Vietnam is not enough to meet the needs of the market Allschools are now virtually no intensive training in these areas and is only stopped

at the level of general training. Currently the school has trained many of interiordesigners but still far distance compared to professional level need for work There are no educations of project management for interior projects that forcing thecompany has to recruit engineers who just have a basic knowledge of civilconstruction and then are trained for project management professional.

Group of companies leading the market in this area such as AA Corporation andTTT Corporation and others would necessarily be greatly influenced by theseissues The quality inputs of human resources for these companies are usuallylower than expectations and required the company must have additional trainingfor staff After the training process, the competitive company easily hunts theemployees of the company Human resources management and other policies ofthe companies are required to always extremely focused and sustained in order

to retain talented staff

The assessment of job satisfaction is very important because it not only affectsthe quality of work that also affects the maintenance of a human longtermstability for companies The work of human resource management has a directimpact to all activities of the employee and thus should have content andmethods of implementation of human resource management as appropriate foreveryone

Consider the difference (if any) by gender, age, years of experience and educationlevel of employee job satisfaction.

To achieve above objectives, the study will answer the following questions:

How do employees assess on the work of human resource management?

How do employees assess their job satisfaction?

How the impact of human resources management to the job satisfaction of

1.4.2 Subjects of study

The assessment of practical human resource management and job satisfaction is donethrough the whole team of staff who are working for the company, as determined frommanager level to employees; excluding directors and workers

1.5 The significance of research

The results of the research will have practical implications for the management ofhuman resources in interior design and construction industry, especially with thetypical companies in the industry were sampled for study represented as AACorporation, TTT Corporation and some other companies The information minedfrom the effects of the elements in the human resources management to the jobsatisfaction of staff is the basis methodology for implementing practical measures to

improve effects of human resource management and job satisfaction of employees inthe company.

1.6 Research Methods

The research used qualitative research methods and quantitative research Qualitativeresearch is used in the preliminary study stage with a group discussion method.Quantitative research phase used in formal research techniques to collect information

in the form of direct interviews The data parameters are examined, analyzed, measuredusing SPSS software (10)

1.7 Research structure

• Chapter 1: Introduction

• Chapter 2: Literature review

• Chapter 3: Methodology

• Chapter 4: Result of research

• Chapter 5: Conclusion and Suggestion

2 CHAPTER 2 | LITERATURE REVIEW

2.1 The theory of human resources

There are many theories of human resources management in existing studies In thispart, the research points out some selected definitions

"Human resources are the overall potential labor of a country or a province is willing tojoin a task" (Pham Minh Hac, 2001)

"Human resources of an organization, the enterprise is formed on the basis ofindividuals with different roles and are linked together according to certain goals"(Tran Kim Dung, 2006)

"Human resources is the whole of human potential (the first and the most basic is thepotential of labor force), including physical, intellectual and personality of workers tomeet the requirements of an organization, an economic or social structure"(Vo XuanTien, 2010)

Regarding the human resources, it is necessary to discuss about the level of structure,the response to the requirements of the labor market Quality human resources reflect

in the level of knowledge, skills, and attitudes of employees

2.2 The theory of human resource management

2.2.1 Definition

There are many different definitions of human resource management, for instance,

“Human Resource Management aims to recruit talented workers, agility, and dedication

in their work, job management, and performance appraisal as well as developing theircapacity" (AJ Price, Human Resource Management in a Business Context, InternationalThomson Business Press, 2nd edition 2004) Another definition: "Human resourcemanagement is to design and implement policies for the areas of activities to makepeople contribute the most effective value for the organization, including humanresource planning, analysis and job design, recruiting and selection,

performance appraisal, training and learning, remuneration, health and safety personnel,and labor relations" The activities of human resources management depends on howthe size and needs of the organization.

In summary, human resources management is the art of using human resourceseffectively to achieve business objectives of the company and ensure the individualneeds of each staff member is satisfied, through a system of policies and practices inhuman resources management This is extremely important activity of any business and

it plays a crucial part the longterm success o f organization

2.2.2 The difference between Personnel management and Human resource

management

Objective Personnel management Human resource management

General view Labor is the input income Is the properties that need to be

developedTraining Objectives Help employees adapt Investment in human resources

The prospect Short and medium term Long term

Advantage of competitive Market and technology The quality of human resourcesBasis of productivity and Machinery and Technology, organization and

Motivation Payment and career Type of job, promotion and

Attitudes towards Employees often resist Human resources can adapt

Figure 2: Source: Nguyen Thanh Hoi, Human Resource Management, 2007

Objective Personnel Management Human Resource Management

Role Problem solving by using Labor Responsible for managing workforce,

regulation and related tasks which is foundation to create the

success of the organization

Is wider meaning

Is combined task of administration tocreate and develop the team work forprofit organizations; helps employees

to be effective in their work

Function Is an independent function of Towards a general function of the

organizations, including the organization In some aspects, all thespecific task of separate HR departments will work together todepartments in the organization solve the tasks of human resources.Performance Response, resolution, Provide strategic management and

providing feedback on the workforce development forrequirements, or if the incident organizations To develop policies andoccurred functions of the organization through

the improvement of human resources.Attitude Motivating employees with Teamwork, effective strategies,

compensation, bonuses, awards, challenges, creativity at work is the

or simplification of work tasks fundamental motivation

Viewpoint: The satisfaction of Viewpoint: achievement in creatingemployees to bring improve incentives for employees

achievement motivation workFigure 3: One other point of comparison between Personnel Management and Human Resource Management

2.2.3 Characteristic of human resource management

Human resource management is gradually replacing personnel management with theleading point, that people is no longer merely an element of the business process which

is a precious source of property in organizations and enterprises

Companies moved from a state of "reduce labor cost in order to reduce expenses" into

"investment in human resources to have a higher competitive advantage, higher profits,and greater efficiency."

From this perspective, human resource management is developed based on thefollowing main principles:

Employees need to be adequate investments to develop their own capacity tomeet the individual needs, meanwhile creating labor productivity, highestworking efficiency and the best contribution to the organization

Policies, programs, and management practices should be established andimplemented in order to satisfy the material needs and employee morale

The working environment should be established so that employees can stimulatethe development and maximum use of their skills

The issue of personnel functions should be carried out in collaboration and animportant part of business strategy of company

Duties of administration people are all in administration, not merely of the HR orpersonnel management

Human resource management is to ensure the correct amount, qualifications andappropriate skills, right place, right time

To implement the objectives of the company, all managers are in charge ofhuman resources management

2.2.4 The model of human resource management

There are many models of human resources management in existing studies In this part, the research points out some selected definitions

Model studies of Singh (2004), practical human resource management consists ofseven components: Training, Performance appraisal; Employee involvement; Jobassignment ; Payment; Recruitment

Model studies of Cynthia D Fisher, Lyle F Schenfeldt, Houghton MifflinCompany (1999), human resource management consists of the human resourceplanning, analysis and job assignment, recruitment and selection, Performanceappraisal, training and learning, payment, health and safety

Human resources management in the UK construction industry: There is anestablished dichotomy in the human resources management literature between the'hard' model, reflecting utilitarian instrumentalism, and the 'soft' model reflectingdevelopmental humanism The hard model of human resources management seeshumans as a resource to be 'provided and deployed' as necessary to achieveorganizational objectives In contrast, the soft model of human resourcesmanagement treats human resources as valued assets who offer a source ofcompetitive advantage In simple terms, the former comprises 'command andcontrol' and the latter 'empowerment and commitment' This dichotomy isundoubtedly an oversimplification of a complex field where rhetoric and realityare difficult to separate (Legge, 1995) Many organizations undoubtedly applyelements of both Companies are also often fond of dressing up hard human

resources management in a soft rhetoric (Truss et al, 1997) The key distinction

lies in whether the emphasis is placed on the human, or the resource (Guest,1987; Storey, 1992) The dichotomy between hard and soft human resourcesmanagement is a direct descendant of McGregor's (1960) Theory X and TheoryY

Model studies of Petrescu & Simmons (2008) for human resource managementand job satisfaction of employees has 06 components: work organization;employee involvement, recruitment and selection, training and learning, andpayment

To study the practices of human resources management affect employee’s jobsatisfaction in interior design and construction industry, this research selects the modelstudy by Petrescu & Simmons (2008) There are six components in human resourcesmanagement that impact to employee’s job satisfaction: work organization; supervision;employee involvement, recruitment and selection, training and learning, payment Inresearch of Petrescu & Simmons (2008), teamwork is a specific component of the workorganization Based on research of Petrescu & Simmons (2008), this research includessix components: Teamwork; Supervision; Employee involvement, Recruitment andSelection, Training and Learning, and Payment

The detailed content of each component as follows:

2.2.4.1 Teamwork

There are many different definitions of teamwork, such as: Teamwork is defined inWebster's New World Dictionary (2003) as "a joint action by a group of people, inwhich each person subordinates his or her individual interests and opinions to theunity and efficiency of the group." This does not mean that the individual is nolonger important; however, it does mean that effective and efficient teamwork goesbeyond individual accomplishments The most effective teamwork is producedwhen all the individuals involved harmonize their contributions and work towards acommon goal

For heterogeneous agents working together to achieve complex goals, teamwork(Jennings, 1995; Yen, Yin, Ioerger, Miller, Xu, & Volz, 2001; Tambe, 1997a) hasemerged as the dominant coordination paradigm

Building on the well developed theory of joint intentions (Cohen & Levesque, 1991)and shared plans (Grosz & Kraus, 1996), the teamwork model (Tambe, 1997a) wasoperationalised as a set of domain independent rules that describe how teams shouldwork together This domain independent teamwork model has been successfullyapplied to a variety of domains

In summary, teamwork is often a crucial part of a business, as it is often necessaryfor colleagues to work well together, trying their best in any circumstance.Teamwork means that people will try to cooperate, using their individual skills andproviding constructive feedback, despite any personal conflict between individuals(Business dictionary, 2012) Teamwork typically involves group of interdependentemployee who work cooperatively to achieve group outcomes (Parker and Wall,1998) Effective team implementation can enhance the motivational properties ofwork and increase job satisfaction

Working in a team empowers people and helps them develop autonomy, which is asource of profound job satisfaction and reduces stress’ (Hayes, 2005) In view of thistheory, the following hypothesis may be made: “Working in a team contributes tojob satisfaction”

In the field of interior design and construction, every job he is catering to a certainproject Almost all projects have to undergo multiple parts at the same time,requiring cooperation to work closely together for a project to be implementedeffectively For that reason, teamwork is very important properties in the execution

of work and affects all employees in the work process The job satisfaction ofemployees is so closely associated with the teamwork nature of the work they aredoing

This research proposes the hypothesis about teamwork is:

H1 Teamwork has positive impact on employee’s job satisfaction

2.2.4.2 Supervision

Supervision is formally defined as a relationship between senior and juniormember(s) of a profession that is evaluative, extends over time, serves to enhancethe skills of the junior person, and monitors the quality of the services offered by thejunior person, and acts as gate keeping to the profession (Bernard & Goodyear,

1992, 2004)

In the study by Petrescu & Simmons (2008), supervision is a factor that affects thejob satisfaction of employees In the field of interior design and construction, theparticular characteristics of specific jobs in the industry will be more correlated tosupervision in the organization.

This research proposes the hypothesis about supervision is:

H2 Supervision has positive impact on employee’s job satisfaction.

2.2.4.3 Employee involvement

Employee involvement, as the definition of a Human Resources expert, Ms Susan,member of the Society for Human Resource Management (SHRM) and theAmerican Society for Training and learning (ASTD) is creating an environment inwhich people have an impact on decisions and actions that affect their jobs.Employee involvement is not the goal nor is it a tool, as practiced in manyorganizations Rather, it is a management and leadership philosophy about howpeople are most enabled to contribute to continuous improvement and the ongoingsuccess of their work organization Relationship of employee involvement andemployee’s job satisfaction, it is discussed in a research: The leaders of U.S.companies have found that a work environment that supports employeeinvolvement, allows employee participation, and features interdependent tasks canincrease productivity, worker flexibility, and job satisfaction (e.g., Cohen, Ledford

& Spreitzer, 1996; Cordery, Mueller, & Smith, 1991; Manz & Sims, 1987;Versteeg, 1990; Harris, 1992) In Vietnam, this theory need to be further tested However this alsoseems like quite a lot in emerging companies in Vietnam in all areas In the field of interior designand construction, this is no exception by job demands require the active participation of staff ingeneral activity, particularly the operation of the implementing of project In that process, theemployee may work more actively and inevitably affect satisfaction in their work

This research proposes the hypothesis about employee’s involvement is:

H3 Employee involvement has positive impact on employee’s job satisfaction.

2.2.4.4 Recruitment and Selection

Recruitment and selection is the process of finding and selecting the candidates(inside and outside the company) the right people to satisfy the labor needs andcomplement the existing workforce The purpose of recruitment is to recruit newstaff have the knowledge, skills, abilities, and motor in accordance with thedemands of work and the longterm goals of the busi ness (Pfeffer, 1998)

The labor market of this industry is not available for market segments that thecompany is selecting always have certain difficulties Also some of the position arevery specific to the company should not be available to candidates with experience

as the company needs So the recruitment process should be more detailed for thecandidate closest to the needs of companies

The recruitment is accurate and the potential candidates can develop good will lead

to performance improvement better, effective for the organization and satisfaction ofemployees working in the organization, including both old and new recruits

This research proposes the hypothesis about recruitment and selection is:

H4 Recruitment and selection has positive impact on employee’s job satisfaction.

2.2.4.5 Training and Learning

Training is the process of improving worker’s capacity through education to makethey are able to perform their work more effectively to meet the currentrequirements of organizational (Tran Kim Dung, 2006) This is particularlyimportant matter because of industryspecific barri ers in this area too large Anequipped with knowledge and skills of employees is fully required so that they can

be confident in their work and thereby brings the highest possible efficiency

This research proposes the hypothesis about training is:

H5 Training and learning has positive impact on employee’s job satisfaction.

2.2.4.6 Payment

Payment is always a difficult issue in society and within the enterprise It containscontradictory relationship between workers' expectations and company’s ability,between accumulation and consumption, the income of other positions For millions

of employees, payment is their daily concern Indeed, salaries are the main source ofincome to sustain and improve the standard living of workers and their families At

a certain level, salaries can be considered as evidence to show the value, position,prestige of employees for personal and social

Payment is understood as the amount that employees receive from the employerpayment corresponding to the quantity and quality of labor they have done

Payment system in a business, generally, to influence employees at four objectives:

to attract, maintain, stimulate, and meet the needs of the law Salaries paid toemployees as four types: paid according to working time, to qualifications and to thejob results

Income of employees includes wages, basic salary, bonus, and allowances Today,

in addition to salaries, material elements, they shall also have the desire for nonmaterial factors such as advancement opportunities, interesting job, consistent withthe challenges of personal, as well as better working conditions

This research proposes the hypothesis about payment is:

H6 Payment has positive impact on employee’s job satisfaction.

2.3 Analysis on employee’s job satisfaction

The relationship between human resources management on the employee’s job

satisfaction in interior design and construction industry

According to Vroom (1964), job satisfaction is a state in which employees have aclear direction for effective work in the company, or really excited to work (Locke,1976) Based on other researcher’s opinions, as shown by the attitude feeling,

beliefs and behaviors or the attitudes of loving their job in general and the particularaspects of work or attitudes (positive or negative) based on the perception of job orwork environment They define job satisfaction as the emotional reactions andfeelings towards different aspects of the job such as job placement, supervision, andtheir superiors, relationships with colleagues, job content, the preferential treatment,and the rewards include promotion, material conditions of working environment, aswell as the structure of the organization.

So there are many different definitions of job satisfaction, but the most commonfocus can understand the satisfaction in work is the evaluation of workers withproblems related to work which they are responsible

It is similar with workers in interior design and construction industry, assessment oftheir work at the company may have felt differently, or is satisfied or not satisfiedbut they reflect the actual place of work they are doing, namely factors related towork These factors may be separate elements or integrated on many factors

What factors effect employee’s job satisfaction? These problems that Humanresources management need to solve following their proper functions Starting in therecruitment, wages and benefits, training and learning, relations and some otherissues

2.4 Research model

The research measures the impact of the practical elements of human resourcesmanagement to the job satisfaction of employees in interior design and constructionindustry This approach has been made in the study by Petrescu & Simmons (2008)model of the practical elements of human resources management includes: workorganization, supervision, employee involvement, recruitment and selection, training andlearning, payment affect the job satisfaction of employees in which teamwork is aspecific component of the work organization

Through the results of previous studies, the basis theoretical of human resourcemanagement and job satisfaction, group discussion results (enclosed Appendix) andconsultation of experts, the model research on the impact of human resource management

to the job satisfaction of employees in interior design and construction industry as shown

in Figure 4

Figure 4: The impact of human resource management to the job satisfaction of employees

in interior design and construction industry

Teamwork

Supervision

Employee involvement

Job satisfaction

Recruitment and selection

Training and learning

Payment

2.5 Summary of Chapter 2

In Chapter 2, we have defined six components of human resources management, and outlinedthe relationship between human resource management with employee’s job satisfaction On theother hand, we also present the model study and hypotheses of this relationship for the nextstages

3 CHAPTER 3 | METHODOLOGY

3.1 Research Methods

Through these two steps are preliminary studies and qualitative research

3.1.1 Preliminary study

Using qualitative methods group discussions

The expert Group discussed for opinion collection is group in charge of Humanresource management of companies in order to identify the necessary issues thatneed for research, define the components and factors in practical human resourcesmanagement in the interior design and construction industry

After selecting the preliminary scale, making interviews with 30 samples in different parts of the company within the scope of study to reassess analyzed factors and the observed variables to match with requirements This study was conducted in Ho Chi Minh City in February 2012

Selection, preliminary draft scale

Preliminary studies conducted by a

group discussion method

Scale adjustment

3.2 Method of data processing

Formal research: a questionnaire used to interview 230 people

Survey data collection

Check the reliability factor; scale testing; exploratory factor analysis

Synthesis results of measurement, analysis

Evaluate the results Proposed measures for the implementation

The scale is a preliminary assessment through two main tools

3.2.1 Inspection by the scale factor Croncbach Alpha

Variable type does not match

3.2.2 Exploratory factor analysis EFA

Examine and redefine the variables in the model research group

3.2.3 Regression analysis and ANOVA analysis

The data were processed by SPSS 16 software

3.3 Methodology

3.3.1 Surveyor

Preliminary study phase: group discussion method and interview expert who in charge

of human resources management After that to do interview 30 samples in differentparts of the company in the field of research

Formal study period: Interviews with staff of the typical company in design fitting AACorporation, TTT Corporation and some other companies Interviews were conducted

in Ho Chi Minh, Binh Duong and Long An, where office buildings and factories ofthese companies

3.3.2 Method of surveying

The survey was done by directly interview employees in company about the practices

of human resources management, job satisfaction by using questionnaires During thesurvey, the questionnaire was sent to employees and interviews on the scene

3.3.3 Size and method of sample choosing

Preliminary study phase: The discussion group is done with the group in charge ofpersonnel management in companies in the study After selecting and adjusting thepreliminary scale, doing survey and interview 30 samples in different parts of thecompany, evaluate once again the suitability of factors

Formal research phase: Sample was taken in convenient sample Using wholeemployees of typical company According to some researchers, the observer must be atleast 4 or 5 times the number of variables in factor analysis (Hoang Trong & ChuNguyen Mong Ngoc, 2005), the scale in thesis has 28 variables, and thus sample should

be 150 people In the other hand, according to Leedy & Ormrod (2005), the size ofsample is as large as possible, to ensure representativeness and to anticipate those who

do not answer or incomplete answer The authors have chosen the sample size is 230people

3.4 Scale adjustment

3.4.1 Process of scale adjustment

• Based on the scale of Singh (2004), the research applies for scale of human

resources management in interior design and construction industry

• Group discussion on the research component of the scale to determine the specificcomponents for research, which define the practical elements of human resource management, jobsatisfaction of employees

• The survey tried to assess the suitability of the elements in the scale before formal research

3.4.2 Qualitative research

Outline content of discussion (Appendix 1):

• Introduce the purpose and nature of the study

• Openended questions to gather as many opinions as possible

After selecting the objects, making discussions with the group in charge of humanresources management in companies Through discussion, creating the draft scale with

23 component elements of practical human resource management, 5 elements are part

of the job satisfaction of employees

3.4.3 Quantitative research

Studies were selected using Likert scale with 5 points: from 1 point absolutely opposed,

to 5 points totally agree Each sentence is a statement about a matter of practical humanresource management, job satisfaction of employees With such content, the staff hadshown their assessment of human resources management at company and the jobsatisfaction of employees

The questionnaire is designed including 28 questions with 28 variables These variableshave an impact to the practice of human resources management, job satisfaction ofemployees There are 23 variables effect directly on human resources

management at the company and 5 variables effect directly on employee’s job

• Teamwork: 03 variables, symbol from tw1 to tw3

• Supervision: 03 variables, symbols from sup1 to sup3

• Employee involvement: 03 variables, symbols from ei1 to ei3

• Recruitment and selection: 05 variables, symbols from sel1 to sel5

• Training and learning: 06 variables, symbols from tra1 to tra6

• Payment: 03 variables, symbols from pay1 to pay3

Following:

3.4.4.1 Teamwork

In the working environment, teamwork are always enhanced in order to bring the bestperformance in company In the interior design and construction industry, this is noexception and it seems more and wider influence In group discussions, there are 03variables:

1 Teamwork in my working environment is very high

2 My job has always been held in teamwork with other department

3 My colleagues always have the spirit of teamwork when working with me

3.4.4.2 Supervision

This factor in a number of companies is identified in a reduction in job satisfaction ofemployees but there are conflicting opinions in the different working environment Inthe field of interior design and construction, supervision is also an important factor thatneeds to be considered, particular how its correlation with job satisfaction ofemployees In group discussions, there are 03 variables:

1 Superior cares of my work

2 I am under a little supervision

3.4.4.3 Employee involvement

New trend of administration always tends to encourage employees active in their work,from which performance will be increased In longterm d evelopment, this could be one ofthe important factors in the work of human resources management affecting workefficiency of employees Ingroup discussions, there are 03 varia bles:

1 I am able to make decision in my work

2 I am encouraged to participate in decisions related to general operations of the company

3 I have opportunity to propose my opinion for work improvement

3.4.4.4 Recruitment and selection

The field of interior design and construction, the recruitment of qualified candidates asrequirements faces to many difficulties Most companies are now fully implemented thebasic steps include preliminary interview, doing test and final interview However, due

to the difficulty in finding suitable candidates due to differences in market supply, theRecruitment and selection process of candidates will normally take longer than otherareas of work In group discussions, 05 variables are recommended:

1 I feel happy to be employed at the company

2 I was recruited with appropriate procedures

3 I was shared and provided enough information that I am interested in the job interview process

4 I was recruited in the right position match with qualifications and my character

5 I am satisfied with the quality of existing employment in the company

3.4.4.5 Training and learning

The quality of employees and their development through training and education aremajor factors in determining longterm profitabilit y of a business Training often isconsidered for new employees only This is a mistake because ongoing training forcurrent employees helps them adjust to rapidly changing job requirements

In group discussions, there are 06 variables:

1 I get basic training before receiving specific work

2 I am trained full knowledge and specialized skills for the current job is done

3 Content of Training meet requirements of my job

4 I noticed my capacity is developing through training process

5 I am pleased with current training in company

6 I would like to join more training programs in company

3.4.4.6 Payment

Payment is always a controversial topic for all companies, including specific sectorssuch as interior design and construction This makes sense when companies considerthe importance of pay to attract talented people, retain key employees, and maintain anexcited, motivated workforce It is difficult to do a salary survey as other common areasbecause salary information is one of the deepest secrets of the labor market There is nodoubt that salary surveys are important both for the employee as well as for theemployer

In group discussion, there are 03 variables:

1 I get paid right with my performance

2 My income depends on my ability

3 My current Payment is suitable

3.4.5 Scale for job satisfaction of employees

Employees evaluate their job satisfaction base on the scope of works that they are incharge The level of satisfaction can be assessed using overall factors at work, whichhave an impact on staff With that reason, the job satisfaction of employees is measuredaccording to Likert scale, following:

1 I am satisfied with my current job

2 I still choose to work at current company

3 The current company is the best place for me to work

4 I consider the company as my second home

5 I do not intend to leave the company

3.5 Summary of Chapter 3

Base on literature review of Human resources management, and employee’s jobsatisfaction, the research has defined methodology and research methods From thisfoundation, we apply for employees, which object to be surveyed with 230 samples

We also clarify how to do the survey on amount of samples; scale testing with 23variables which including components of Human resources management and 05variables which including components of employee’s job satisfaction; and determinethe method of data processing It is important to prepare for next stage in order todefine the result of research in Chapter 3

4 CHAPTER 4 | RESULT OF RESEARCH

In chapter 2, we present research methods and Likert scale that are applied for scale testingand description of research process Move to chapter 3, we continue to present the result ofresearch of relationship between Human resources management and employee’s jobsatisfaction by using scale testing, exploratory factor analysis and regression analysis

4.1 Sample description:

Number of questionnaires: 230

Number of answerers: 212, achieve 92,17 %

In the questionnaires collected, there are 07 copies for the same mark with all the questions,

so do not use this 07 questionnaires

Number of questionnaires used for the study: 205 copies, reaching rates of 96.6%compared to the number of questionnaires collected

Number of sample size: 205

Table 4.1 Description of the survey on gender

Frequency Percent Valid Percent Cumulative Percent

3645y 39 19.0 19.0 85.4

Table 4.3 Description of the survey on Years of experience

Frequency Percent Valid Percent Cumulative Percent

Table 4.4 Description of the survey on Education level

Frequency Percent Valid Percent Cumulative Percent

4.2 Preliminary evaluation scale with Cronbach Alpha

4.2.1 Testing the reliability of the independent variable

4.2.1.1 Teamwork