The impact of perceived organizational support on job performance, the medication of job engagement a study of commercial banks in vietnam luận văn thạc sĩ

By This reason this study also analyzes related mediation factors to support to the relation of Perceived Organizational Support on Job Performance.. Due to this reason, the topic we cho

MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY

The Impact of Perceived Organizational Support on Job Performance, the Mediation of Job Engagement

A Study of Commercial Banks in Viet Nam

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City, 2012

MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY

The Impact of Perceived Organizational Support on Job Performance, the Mediation of Job Engagement

A Study of Commercial Banks in Viet Nam

MAJOR: BUSINESS ADMINISTRATION

ACKNOWLEGEMENT

First, I would like to thank to our supervisor of this study, PhD Pham Quoc Hung for his valuable guidance and advice He inspired me greatly to work in this study His willingness to motivate me contributed tremendously to my study I also would like to thank him for providing me valuable documents, information as the guidance of my study Besides, I would like to thank all teachers of the Ho Chi Minh City of Economics (EUH) for providing me and student like us with a valuable knowledge, good environment and facilities to complete our researches I also would like to thank Mr Nhat Truong, from The Poly-Technique University Ho Chi Minh City for supporting me

to analyze the research data by using Amos with statistical technique SEM My thanks and appreciations also go to my colleague in developing the project and people who have willingly helped me with their abilities Finally, I would like to express my gratitude and thanks towards my parents, sistsers, friends for their understanding, kind co-operation and encouragement which help me in completion of MBA programe and this study, for their support in giving me such attention and time Without helps of the particular that mentioned above, I would face many difficulties while doing this study

INDEX

Page

CHAPTER 1: INTRODUCTION 1

1.1 Executive abstract 1

1.2 Purpose of the study 2

1.3 Questions of the study 3

1.4 Scope of the study .3

1.5 Framework of the study 4

CHAPTER 2: LITERATURE REVIEW 4

2.1 Perceived organizational support (POS) .5

2.2 Job engagement 6

- Physical engagement (PE) 6

- Emotional engagement (EE) 6

- Cognitive engagement (CE) 8

2.3 Job performance (JB) 8

2.4 Related theories and antecedent researches .10

2.5 Hypothesis development 16

* Research model .18

CHAPTER 3 RESEARCH METHODOLOGY 18

3.1 Research design 19

3.2 Questionnaire development 20

3.3 Translation of the questionnaires .22

3.4 Variable control 23

3.6 Target population 25

3.7 Sample size .26

3.8 Selecting the sample and collecting data 26

3.9 Methods of data analysis 28

3.9.1 Data Screening 28

3.9.2 Normal Distribution Examining 28

3.9.3 Reliability .28

3.9.4 Confirmatory factor analysis (CFA) & Structural equation modeling (SEM) .28

CHAPTER 4: RESULT OF DATA ANALYSIS 37

4.1 Descriptive statistics 37

4.2 Normal Distribution Examining 41

4.3 Reliability 42

4.4 Confirmatory factor analysis (CFA) .45

4.5 Structural equation modeling (SEM) 49

4.6 Sumary of model test .55

CHAPTER 5: CONCLUSIONS AND RECOMMENDATIONS 57

5.1 Summary of all hypotheses .57

5.2 Conclusions and implications 58

5.3 Limitations and recommendations .62

CHAPTER 6: LIST OF REFERENCES .63

7 APPENDIX .67

CHAPTER 1: INTRODUCTION

1.1 Executive abstract

In the context of the international economic tendency, WTO integration, Vietnam now has both opportunities and challenges for organizations to raise pressure on the competitiveness of the product, services, brand, and human resources In particular, human resources is considered a key advantage for organizations to develop their businesses, it is a valuable asset to help organizations improve their competitiveness

and performance

Currently, the reciprocity responsibility norms were popular applied in organization in Viet Nam, however majority of organizations have not sufficiently invested interest and improve the system of human resource management in the area of relation between between perceived organizational support and job performance Due to this reason, there remain areas that both employers and employees do not have in common

As a result, the consequence of this shortcoming in HR Management, to some extent, has caused employees were not motivated to compensate beneficial treatment and the organizations did not obtain expected business outcome

According to previous studies such as studies of (Pfeffer J 1998); (Huselid, MA 1995), (Guest 1997), (D Hartog and RM Verburg 2004), (Singh K 2004), human resource practices have important influence on the performance of the business By studying factors contributing to the effective human resource management, it proves that preceived organizational support (POS) takes an important position in this area POS contributes to increase employees’ performance (POS) to help organizations reach their objectives The behavioral outcomes of POS mentioned herewith include

increases, decrease in role and Job performance

The study of effective Human resource (HR) management, specifically relationship between perceived organizational support (POS) and job performance also measures of man-power resource to achieve set targets of organizations; help managers with solutions to encourage and motivate employees to work effectively in conditions of tight labour market, where changing knowledge management practices and global convergence of technology has redefined the nature of work, and in the context of limited talent resources in manpower market

By studying the impact of Perceived Organizational Support on Job Performance it has been seen that there are mediation factors also contribute to establishing relation between Perceived Organizational Support on Job Performance Following Kahn (1990) people employ and express themselves physically, cognitively, emotionally and mentally during role performances” By This reason this study also analyzes related mediation factors to support to the relation of Perceived Organizational Support on Job Performance

As we know that there is little theory or empirical observation accounts for the role of perceived organizational support, engagement as a means through which organizations can create competitive advantage In particular, not many researches examine the role

of engagement as mechanism that links employee characteristic and organizational factors to job performance This can be explained why the situation is the same in Viet Nam, not many research and specific study on the Perceived Organizational Support and Job Performance Also, almost no research and no specific study on the Perceived Organizational Support and Job Performance in Viet Nam The majority of organizations in Viet Nam has not yet invested interest and improves their system of human resource management in this specific area

Due to this reason, the topic we choose for our thesis is studying “The Impact of Perceived Organizational Support on Job Performance, the Mediation of Job Engagement - A Study of Commercial Banks in Viet Nam By this study, we will expect to find out solution on how to improve manpower resource management in commercial banks in Viet Nam, especially solutions relating to factors affecting the impact of Perceived Organizational Support on Job Performance, the Mediation role of Job Engagement in Commercial Banks in Viet Nam For the result, the study is expected to explain how bank community should respond to challenges of human resource so as to get satisfactory staff’s performance and satisfactory business outcome through the factors of Perceived Organizational Support and Job Engagement

1.2 Purpose of the research

The purpose of this research is to study the impact of Perceived Organizational Support on Job Performance and related mediation factors to the relation of POS–Job Performance (JB) in commercial banks in Viet Nam, specifically:

- Relationship between perceived organizational support and job performance in banks in Viet Nam

- Investigating mediation factors that are affecting relationship between perceived organizational support and job performance in banks in Viet Nam

- Evaluating affect of find factors that are positively affecting job performance in banks in Viet Nam; find factors that are positively affecting relationship between perceived organizational support and job performance in banks in Viet Nam

- Offer measures to improve the impact of perceived organizational support to job performance in banks in Viet Nam, help banks to improve business performance and enhance their ability to attract, motivating, satisfying and keep qualified employees, encourage the employee to work in an effective way

1.3 Questions of the research

With the above mentioned background, there arise question required to be studied so

as to have solution as follows:

1 What is the common relationship between perceived organizational support and job performance in commercial banks in Viet Nam?

2 Which factors can be applied to improve the impact of perceived organizational support and job performance in commercial banks in Viet Nam, which are key factors?

3 Can the improvement of relation of perceived organizational support and job performance promote and develop competitive advantage and performance outcome

of commercial bank in Viet Nam?

1.4 Scope of the research

Study subjects: staffs and managers of commercial banks in Vietnam

Since HR Management is a very broad research theme, this research only focuses on studying scientific basis to help managers understand the factors that relationship between perceived organizational support and job performance so that they can implement these tools in banks This research is limited in the scope of the Impact of

Perceived Organizational Support on Job Performance, related Mediation of Job Engagement (PE) in commercial banks in Viet Nam

1.5 Framework of the study

CHAPTER 2: LITERATURE REVIEW

Chapter 2 is to review theories of Perceived Organizational Support on Job Performance and related mediation factors to the relation of POS–Job Performance (JB) including Physical engagement (PE), Emotional engagement (EE), Cognitive engagement (CE), and Job performance (JB) This Chapter also presents related theories, antecedent researches; hypothesis development and proposed research model Most of the research in Organizational behavior has been concerned with three attitudes: job satisfaction, job involvement, and organizational commitment Other attitudes are also attracting attention from the researchers, including perceived organizational support (POS) and employee engagement In our research we

Introduction Research problem

Research questions Research objectives

Literature review Hypothesis

Empirical model Data collection Descriptive statistic

Data analysis

Conclusion, recommendation and limitation

concentrate in studying the relation of organizational support, employee engagement and job performance in the context of commercial bank in Viet Nam:

2.1 Perceived organizational Support (POS):

As one of definition, POS is the degree to which employees believe that their organization values their contributions and cares about their well-being (Eisenberger, Huntington & Sowa, 1986; Rhoades & Eisenberger, 2002)

POS is generally thought to be the organization’s contribution to a positive reciprocity dynamic with employees, as employees tend to perform better to pay back POS (Rhoades & Eisenberger, 2002) Research on perceived organizational support observed if managers are concerned with their employees’ commitment to the organization, employees are focused on the organization’s commitment to them For employees, the organization serves as an important source of socioemotional resources, such as respect and caring; and tangible benefits, such as wages and medical benefits Being regarded highly by the organization helps to meet employees’ needs for approval, esteem, and affiliation Positive valuation by the organization also provides an indication that increased effort will be noted and rewarded Employees therefore take an active interest in the regard with which they are well taken care of by their employer

Organizational support theory (OST: Eisenberger, Huntington, Hutchinson, & Sowa, 1986; Rhoades & Eisenberger, 2002; Shore & Shore, 1995) indicated that in order to meet socioemotional needs and to assess the benefits of increased work effort, employees form a general perception concerning the extent to which the organization values their contributions and cares about their well-being Such perceived organizational support (POS) would increase employees’ felt obligation to help the organization reach its objectives, their affective commitment to the organization, and their expectation that improved performance would be rewarded Behavioral outcomes

of POS would include increases in in-role and extra-role performance and decreases unexpected outcome and behaviors from employees

Although there were relatively few studies of POS until the mid 1990’s, research on the topic has developed in the last few years Rhoades and Eisenberger’s (2002) meta-analysis covered some 70 POS studies carried out through 1999, and over 300 studies

have been performed since The meta-analysis found clear and consistent relationships

of POS with its predicted antecedents and consequences

Recent research of David R Hekman and colleagues (2009) found that professional employees were more likely to reciprocate POS when they strongly identified with the organization Indeed, such workers' organizational identification and professional identification combined to influence performance behaviors The results suggested that POS had the most positive influence on professional employees' work performance when employees strongly identified with the organization and weakly identified with the profession

2.2 Job engagement (JE)

Job engagement has seen dramatic growth in research interest over the past few years Briefly, work engagement can be defined as a positive, fulfilling state of mind, most commonly characterized by vigour, dedication, and absorption (Jonathon R.B Halbesleben and Anthony R.Wheeler, 2008) Job embeddedness is defined as ‘‘the combined forces that keep a person from leaving his or her job’’ (Yao, Lee, Mitchell, Burton, & Sablynski, 2004, p 159)

“Work engagement is defined as a positive, fulfilling, work-related state of mind that

is characterized by vigor, dedication, and absorption” (Schaufeli, Salanova, Gonza´lez – Roma and Bakker, 2002, p 74)

Kahn, W A (1990) was the first scholar to define “personal engagement” as the harnessing of organization member’s selves to their work roles: in engagement, people

employ and express themselves physically, cognitively, emotionally and mentally

during role performances Kahn (1900) theorized that there is a unique aspect of human aganency that functions in a moreholictic, consistence and connected manner

To be engage in a job not just being cognitive attentive to the job, or feeling and expressing emotions on the job, or doing specific job tasks simply for the sack of

doing them Instead, engagement reflects the simultaneous investment of cognitive,

emotional, and physical energies in such a way that one is actively and completely

involved in the full performance of a role

Besides, there are others views relating to definition of work engagement, in which are two different schools of thought as follows: on the one hand Maslach and Leiter

burnout and engagement as two opposite poles The second school of thought operationalizes engagement in its own right as the positive antithesis of burnout as stated by Bakker, A.B., Demerouti, E (2007) According to this approach, work engagement is defined as a positive, fulfilling, work-related state of mind that is characterized by vigor, dedication, and absorption Vigor is characterized by high levels of energy and mental resilience while working, the willingness to invest effort in one’s work, and persistence even in the face of difficulties; dedication by being strongly involved in one's work, and experiencing a sense of significance, enthusiasm, inspiration, pride, and challenge; and absorption by being fully concentrated and happily engrossed in one’s work, whereby time passes quickly and one has difficulties with detaching oneself from work

Measures of engagement:

A measure that was constructed and validated by Schaufeli, Salanova, Gonzalez-Roma and Bakker (2002), called the Utrecht Work Engagement scale, is often administered

to assess engagement (Salanova, Agut,& Peiro, 2005)

The first subscale, vigor, is represented by five items and reflects elevated levels of energy, resilience, and persistence The second subscale, dedication, is also represented by six items and corresponds to a sense of purpose, enthusiasm, inspiration, pride, and challenge at work The third subscale, absorption, represents the extent to which individuals are absorbed in their work

Engagement measures derived from the work of Kahn

Rich, Lepine, and Crawford (2010) develop a measure of engagement that more explicitly assesses the three dimension of engagement that were defined by Kahn

(1990, 1992): the investment of physical, emotional, and cognitive energy into the

task at work

First, to represent physical engagement, Rich, Lepine, and Crawford (2010) adapted

items from a measure of work intensity, developed by Brown and Leigh (1996) This

subscale comprised six items, such as "I work with intensity on my job" Second, to

represent emotional engagement, a set of items were derived from a measure that was

utilized by Russell and Barrett (1999), entailing two dimensions: positive or pleasant feelings and a sense of energy or activation In particular, each item refers to the extent

to which individuals perceive their job as both pleasant and energizing This subscale

also comprised six items, such as "I am excited about my job" Third, to represent

cognitive engagement, items developed by Rothbard (2001) were adapted to assess the

degree to which individuals felt both focused as well as engrossed in their work One example of these six items is "At work, I am absorbed by my job"

Other measures of engagement:

Other measures of engagement comprise only one main factor Peterson, Park, and Seligman (2006), for example, developed a measure of engagement that primarily seems to represent absorption They conceptualized engagement, together with meaning and pleasure, as the three factors that underpin happiness Harter, Schmidt, and Hayes (2002) developed a measure, comprising 12 items, that assesses one facet, but defined more broadly They defined engagement as the perception that expectations are clear, the job is significant, colleagues are trustworthy, and the potential to develop is strong

Other views are also available Following Maslach, Jackson, & Leiter (1996) if engagement is conceptualized as the converse of burnout, the Maslach Burnout Inventory is sometimes administered Cf., Maslach & Leiter 1997 (2008) indicates that low levels of exhaustion and cynicism as well as elevated levels of efficacy are assumed to manifest engagement Indeed, research indicates that vigor and exhaustion seem to represent opposite poles of one dimension; similarly, dedication and cynicism represent opposite poles of one dimension (Gonzalez-Roma, Schaufeli, Bakker, & Lloret, 2006) The Oldenburg Burnout Inventory (Demerouti, Bakker, Nachreiner, & Ebbinghaus, 2002) is sometimes preferred instead, because the scale includes both positively and negatively worded items, more applicable to engagement

Due to the importance role of job engagement, by this study we aim to prove the role

of job engagement, as a mediator (including cognitive, emotional and physical engagement), between POS and job performance

2.3 Job performance

Motowidlo, Borman, and Schmit (1997, p.73) stated that, “as a construct, performance

is behavior with an evaluative component, behavior that can be evaluated as positive

or negative for individual or organizational effectiveness.”

Following Conway, Motowidlo & Schmit (1999), Motowidlo et al (1997), two specific types of job performance in the form of work performance are task performance, which relates to the pursuit of activities described in the formal job description which bears a direct relationship to the organization’s technical core; and contextual performance, often referred to as organizational citizenship behaviors (OCB) and which does not contribute through the organization’s core technical processes

Among the most commonly accepted theories of job performance comes from the work of John P Campbell and colleagues Coming from a psychological perspective, Campbell describes job performance as an individual level variable Campbell defines performance as behavior It is something done by the employee Campbell allows for exceptions when defining performance as behavior He clarifies that performance does not have to be directly observable actions of an individual It can consist of mental productions such as answers or decisions However, performance needs to be under the individual's control, regardless of whether the performance of interest is mental or behavioral

Dennis Organ (1988) is generally considered the father of OCB (Organizational citizenship behavior) According to Organ, OCB refers to as behaviors exhibited by employees that are supportive, discretationary, and go beyond normal job requirements Organ (1988) defines OCB as “individual behavior that is discretionary, not directly or explicitly recognized by the formal reward system, and that in the aggregate promotes the effective functioning of the organization” (p 4) Organ’s definition of OCB includes three critical aspects that are central to this construct First, OCBs are thought of as discretionary behaviors, which are not part of the job description, and are performed by the employee as a result of personal choice Second, OCBs go above and beyond that which is an enforceable requirement of the job description Finally, OCBs contribute positively to overall organizational effectiveness The word discretionary, according to Organ (1988) means that behavior

is not a requirement of formal job description OCB is a matter of individual choice and failure to exhibit that the behavior is not generally considered as cause for penalty What is important is that these examples describe behaviors which are helpful to the organization, yet they are not behaviors considered part of the core elements of the job

2.4 Related theories and antedent researches

2.4.1 Relationship of POS- Job performance and role of mediators

Perceived organizational support, a concept that reflects the type of support Kahn (1990) discussed, develops through employee interactions with organizational agents such as supervisors and reflects employees’ beliefs concerning the extent to which the organization they work for values their contributions and cares about their well-being (Eisen- berger, Huntington, Hutchison, & Sowa, 1986) Employees who perceive high organizational support have positive expectations concerning the organization’s likely reaction to employees’ contributions as well as their mistakes, and thus they have less reason to fear unexpected consequences for their self-images, statuses, or careers as a result of investing themselves fully into their work roles (Edmondson, 1999) When perceived organizational support is low, employees are unsure of what to expect, fear that they may suffer for their personal engagement, and choose to guard their selves by withdrawing from their roles (Kahn, 1990) This reasoning is consistent with research showing positive relationships between perceptions of various forms of support in an organization and conceptualizations of job engagement similar to Kahn’s (e.g., Bakker, Demerouti, & Schaufeli, 2005; Nembhard & Edmondson, 2006; Saks, 2006).`

Following research of Robert Eisenberger, Stephen Armeli, Barbara Rexwinkel, Patrick D Lynch, and Linda Rhoades, uiversity of Delaware (2001) By manage a survey of four hundred thirteen postal employees regarding reciprocation's role in the relationships of perceived organizational support (POS) with employees' affective organizational commitment and job performance The authors found that (a) POS was positively related to employees' felt obligation to care about the organization's welfare and to help the organization reach its objectives; (b) felt obligation mediated the associations of POS with affective commitment, organizational spontaneity, and in-role performance; and (c) the relationship between POS and felt obligation increased with employees’ acceptance of the reciprocity norm

as applied to work organizations The pattern of findings is consistent with organizational support theory's assumption that POS strengthens affective commitment and performance by a reciprocation process

2.4.2 Related theories to concepts of POS, JE, JP:

Early theories of motivation, satisfaction and antecedent researches prove significant relation among motivation with Perceived organizational support (POS), Job engagement (JE) and Job performance (JP) Properly manipulating the tools of Job motivation, satisfaction will help to inmprove POS, PE and JP Research result of Research of Bruce Louis Rich and Jeffrey A Lepine, Eean R Crawford (2010) showed mediation roles of Job engaement and Job satisfaction in the relation of POS and Job performance

Roles of motivation, satisfaction to POS, JE, JP can be seen in the following contents:

- Motivation:

Motivation is one of the most frequently research topics in organizational behavior (OB) Many research prove that motivation play important role to improve employee’s engagement, retention, commitment, job satisfaction; effective support of the organizations to employees; reducing employee turn-over…

Motivation is defined as the process that account for an individual’s intensity, direction and persistence of effort toward attaining a goal (T.R Michell, 1997) In the 1950s three specific theories were formulated which significantly affect, even now in term of validity They still the best-known explanation for employee motivation They are the Hierachy of need theory of Maslow (1943), theories X and Y and Herzberg two factor theory (1959)

Beside the above early theories of motivation, other theories were recognized as basis for studies and researches, providing us the theoretical basis to prove relation among factors of HR management, especially the relation among job performance, motivation, engagement, retention, commitment, job satisfaction, turnover, and support of the organizations to employees They are ERG Theory of Alderfer (1969), McClelland’s theory of needs (1988), as we mention hereunder

- Satisfaction: it is necessary to recognize that motivation was also proved to have

relation with satisfactory, and thus having relation with job satisfaction and job performance, organizational citizenship behavior (OCB) (Stephen P.Robbins and Timothy A.Hudge, 2007)

Job satisfaction definition: Job satisfaction can be defined as a positive feeling about

one’s job resulting from an evaluation of its characteristics A person with a high level

of job satisfaction hold positive feeling about the job, while the other person who is dissatisfied holds negative feeling about the job (Stephen P Robbins and Timothy A.Hudge, 2007)

Job satisfaction and Job performance (JP) : A review of 300 studies suggests that the

correlation between job satisfaction and job performance is pretty strong When satisfactory and proclivity date are gathered for organization as a whole, we find that organizations with more satisfied employees tend to be more effective than organization with fewer satisfied employee (T A Judge, C J Thoresen, J.E Bono, and G.K Patton, 2011)

- Hierachy of need theory of Maslow (1943)

It can say that the most well-known theory of motivation is Abraham Maslow’s Hirachy of Needs Following Maslow, within every human being there is existence a hierarchy of five needs These needs are:

o Physiological: Includes hunger, thirst, shelter, sex, and other body needs

o Safety: Include security and protection from physical and emotional harm

o Social: Includes affection, belongingness, acceptance, and friendship

o Esteem: includes internal esteem factors such as self-respect, autonomy, and achievement; and external esteem factors such as status, recognition, and attention

o Self-actualization: The drive to become what one is capable of becoming, including growth, achieving one’s potential, and self-fulfillment

As each of these needs becomes substantially satisfied, the next becomes dominant Maslow separated the five needs into higher and lower orders Physiological and safety needs were describe as low-order-needs and social, esteem, and self-actualization as higher-order needs

Emphasis on growth or higher order needs of A Maslow social needs (affection, friendship, acceptance, belongingness in group), esteem ego needs (status, recognition,

respect, ect.) and actualization needs (growth, achieving one’s potential, fulfillment ect.)

self-The differentiation between the two orders was made on the premise that higher-order needs are satisfied internally (within a person), whereas lower-order needs are predominantly satisfied externally (by things such as pay, union contracts and tenure)

- Herzberg two factor theory (1959)

The two factor theory also called motivation-hygiene theory was proposed by

psychologist Two factor theory Frederick Herzberg theorized that employee

satisfaction depends on two sets of issues - Two dimensions of employee satisfaction:

"hygiene" issues and motivators Once the hygiene issues have been addressed, he said, the motivators create satisfaction among employees

According to Herzberg, hygiene issues, cannot motivate employees but can minimize dissatisfaction, if handled properly In other words, they can only dissatisfy if they are absent or mishandled Hygiene topics include company policies, supervision, salary, interpersonal relations and working conditions They are issues related to the employee's environment Motivators, on the other hand, create satisfaction by fulfilling individuals' needs for meaning and personal growth They are issues such as achievement, recognition, the work itself, responsibility and advancement Once the hygiene areas are addressed, said Herzberg, the motivators will promote job satisfaction and encourage production

- Theory X and Theory Y (1960)

Theory X and Theory Y is theory of human motivation McGregor developed a

philosophical view of humankind with his Theory X and Theory Y in 1960 His work

is based upon Maslow's Hierarchy of Needs, in that he grouped the hierarchy into lower-order needs (Theory X) and higher-order needs (Theory Y) He suggested that

Hygiene issues (dissatisfies)

- Company and administrative policies

management could use either set of needs to motivate employees, but better results would be gained by the use of Theory Y, rather than Theory X These two opposing perceptions theorized how people view human behavior at work and organizational life:

Theory X: With Theory X assumptions, management's role is to coerce and control

employees

Theory Y: With Theory Y assumptions, management's role is to develop the potential

in employees and help them to release that potential towards common goals

- ERG Theory of Alderfer (1969)

Clayton Alerfer attempt to rework Maslow’s needs hierarchy to align in more closely with empirical research.Alderfer argued that there are three groups of core needs- existence (similar to Maslow’s physiological and safety needs), relatedness (similar to Maslow’s social and status needs), and growth (similar to Maslow’s esteem needs and self-actualization)

Unlike Maslow’s theory, ERG does not assume that there exists a rigid hierarchy in which lower-needs must be substantially gratified before one can move on

- McClelland’s theory of needs (1988)

McClelland’s theory of needs developed by David McClelland The theory focuses on three needs: Achievement, power, and affiliation They are defined as follows:

o Need of achievement: the drive to excel, to achieve in relation to a set of standard, to strive to succeed

o Needs of power: The need to make others behave in a way that they would not have to behave otherwise

o Need for affiliation: The desire for friendly and close interpersonal relationship

Content of theories - a comparison

Hierarchy of Needs

Theory (Maslow)

ERG of Clayton Alderfer

Herzberg’s Factor Theory

Two-David McClelland’s Theory of Needs

Achievement Esteem

Growth needs Motivators

Need for Power Love/Belonging Relation needs Need for Affiliation Safety

Physiological

Existence needs

Hygiene Factors

(Source: Bowduch & Buono, 65 – 70, Schein, P 93 )

In brief: Satisfaction of employees’ needs help to improve motivation Depending on the extents, levels of employees’ satisfaction coming from the interaction between employers and employees, from the support of employer to employees, there will result outcomes of compatible engagement, job performance and perceived organization support

- Researches results of Bruce Louis Rich and Jeffrey A Lepine, Eean R Crawford (2010) and of Robert Eisenberger, Stephen Armeli, Barbara Rexwinkel, Patrick D Lynch (2011)

This research proved the relation of the related factors which are the basis for this study to develop in the context of Viet Nam, especially in the community of commercial banks, specifically as follows:

Research of Bruce Louis Rich and Jeffrey A Lepine, Eean R Crawford (2010) found the relation of POS-Job performance, and also the mediators of Job engagement beside other

1 Hypothesis 1A: Perceived organizational support is positively related to Physical engagement

2 Hypothesis 1B: Perceived organizational support is positively related to cognitive engagement

3 Hypothesis 1C: Perceived organizational support is positively related to Emotional engagement

2.5.2 Hypothesis for the relation of Perceived organizational support (POS) - Job Performance (JP)

Following Eisenberger, Huntington, Hutchinson, & Sowa, 1986; Rhoades & Eisenberger, in order to meet socioemotional needs and to assess the benefits of increased work effort, employees form a general perception concerning the extent to which the organization values their contributions and cares about their well-being Outcomes of POS would include increases in in-role and extra-role performance (Job performance) and decreases unexpected outcome and behaviors from employees Such perceived organizational support (POS) would increase employees’ felt obligation to help the organization reach its objectives Developed from these reasons, the

hypothesis for the relation of Perceived organizational support - Job Performance (POS) is POS engagement is as follows

4 Hypothesis 1D: Perceived organizational support is positively related to Job Performance

2.5.3 Hypothesis for the relation of Job Engagement (JE) - Job Performance (JP)

Following Kahn, W A (1990) “Personal engagement” as the harnessing of organization member’s selves to their work roles Engagement reflects the simultaneous investment of cognitive, emotional, and physical energies in such a way that one is actively and completely involved in the full performance of a role The investment of engagement factors (physical, emotional, and cognitive) energy into the task at work For these reason the hypothesis for the relation of Job engagement -Job Performance is as follows:

5 Hypothesis 2A: Physical engagement is positively relate to Job Performance

6 Hypothesis 2B: Cognitive engagement is positively relate to Job Performance

7 Hypothesis 2C: Emotional engagement is positively relate to Job Performance

2.5.4 Hypothesis for the mediation role of Job engagement (JE)

POS strengthens affective commitment and performance by a reciprocation process (Robert Eisenberger, Stephen Armeli, Barbara Rexwinkel, Patrick D Lynch, and Linda Rhoades, University of Delaware, 2001) Following Kahn (1990, 1992), the investment of physical, emotional, and cognitive energy into the task at work By this way it can be seen that engagement plays mediation role in the associations of POS

with job performance The hypothesis for mediation role of engagement is as follows:

8 Hypothesis 3A: Physical engagement positively meditates the relationship between Perceived organizational support and Job Performance

9 Hypothesis 3B: Cognitive engagement positively meditates the relationship between Perceived organizational support and Job Performance

10 Hypothesis 3C: Emotional engagement positively meditates the relationship between Perceived organizational support and Job Performance

Emotional engagement.

Cognitive engagement

Job Performance

The Impact of Perceived Organizational Support on Job Performance,

the Mediation of Job

Engagement A study of Commercial Banks in Viet Nam.

CHAPTER3: RESEARCH METHODOLOGY

This chapter is to describe methodologies for this research including: research design, questionnaire development, data collection, method of data analysis based on the

results of the above mentioned literature review chapter In addition, in this chapter we state theories relating to variables, constructs proposed in our research model

3.1 Research design:

3.1.1 The approach to research in this study is quantative research

“In quantitative research your aim is to determine the relationship between one thing (an independent variable) and another (a dependent or outcome variable) in a population Quantitative research designs are either descriptive (subjects usually measured once) or experimental (subjects measured before and after a treatment) A descriptive study establishes only associations between variables An experiment

establishes causality” (Will G Hopkins 2000)

For accurate estimate of the relationship between variables, our descriptive study needs a sample of 200 subjects To express the relationship between variable we use effect statistics, such as correlations, relative frequencies, or differences between means

3.1.2 The quantative methology is a cross-sectional survey:

In quantitative research, the study aim is to determine the relationship between one thing (an independent variable) and another (a dependent or outcome variable) in a population Quantitative research designs are either descriptive (subjects usually measured once) or experimental (subjects measured before and after a treatment) A descriptive study establishes only associations between variables An experiment establishes causality.( http://www.sportsci.org/jour/0001/wghdesign.html)

Cross-sectional studies (also known as cross-sectional analyses or transversal studies)

form a class of research methods that involve observation of all of a population, or a representative subset, at one specific point in time Cross-sectional studies are descriptive studies, it can be used to describe, not only the Odds ratio, but also absolute risks and relative risks from prevalence (sometimes called prevalence risk

ratio, or PRR) (Carsten Oliver Schmidt, Thomas Kohlmann, 2008, James Lee, 1994)

Cross-sectional surveys are used to gather information on a population at a single point

in time An example of a cross sectional survey would be a questionnaire that collects data on how parents feel about Internet filtering, as of March of 1999 A different cross-sectional survey questionnaire might try to determine the relationship between

two factors, like religiousness of parents and views on Internet filtering (Babbie, Earl

R Survey Research Methods Belmont, CA: Wadsworth Pub Co., 1973.)

This study is carried out through quantitative research methology in the form of sectional survey Cross-sectional survey are a positive methodology designed to obtain information on variables in different contexts, in which variables of interest in a sample of subjects are assayed once and the relationships between them are determined Different banks and groups of people selected in this study and be conducted to ascertain how factors differ Banks mentioned in this study are commercial banks in Viet nam from different areas from the North to the South After survey data is conducted, statistical test is conducted to find out correlation between variables This step is mentioned in the data analysis step

cross-3.2 Questionnaire development

Data collection relies on questions as vehicle for extracting the primary research data

(William B Werther, Jr., Ph.D and Keith Davis, 1996), thus, questionnaires in this study are developed with respect to the general rules for questionnaire designing as follows: The questionnaire development is the key step to set up measuring scale for the study

In this study, questionnaire, scales development is designed based on antecedent researches of:

+ Bruce Louis Rich (California State University SanMarcos) and Jeffrey A Lepine, Eean R Crawford (University of California) (2010)

+ Robert Eisenberger, Stephen Armeli, Barbara Rexwinkel, Patrick D Lynch, and Linda Rhoadesm, (University of Delaware) (2001)

Also, in this study, two mini group discussions were conducted In the first discussion, four bank experts including two branch directors and two managers from as Sacombank, Saigonbank, Agribank, VinaSiam Bank were invited The purpose of this step is to examine the clarity the instrument and to be sure that all survey questions were clear in meaning and sufficient to cover the research matter in reality, from the perspective of a banking professional Some amendments were made after suggestions from bank managers

The other discussion was conducted with the participation of 4 banking staff in HR and banking management in commercial banks such as Sacombank, Saigonbank, Agribank, VinaSiam Bank The purpose of this step was the same as that of the first discussion, but in this case from the staff’s perspective with reference to the actual situation of banking sector of Vietnam and working environment, practice of Vietnam Some questions were adjusted on the recommendation of the participants, for example,

to make the terms in the questionnaire more concrete and less negative Official questions were deliberately selected for the study; those unnecessary questions were taken away

Final questionnaire check was implemented with a group of HR staff working in banks

As mentioned in this study, the study model consists of 5 constructs including: The Perceived organizational support (01 construct), Job Engagement (03 constructs) and Job performance (01 construct), in which the components of each construct are

listed as follows:

i The Perceived organizational support scale consists of 6 items as follows

POS.1 The Bank takes pride in my accomplishment

POS 2 The Bank really cares about my well-being

POS 3 The Bank strongly considers my goals and values

POS 4 The Bank strongly considers my goals and values

POS 5 The Bank shows high concerned for me

POS 6 The Bank is willing to help me if I need a special favor

ii The Physical engagement scale consists of 5 items as follows

PE 1 I work with intensity of my job

PE 2 I exert my full effort to my job

PE 3 I devote a lot of my energy to my job

PE 4 I try my hardest to perform well on my job

PE 5 I try as hard as I can to competes my job

iii The Emotional engagement scale consists of 6 items as follows

EE.1 I am enthusiastic in my job

EE.2 I am energic at my job

EE.3 I am interested in my job

EE.4 I am proud of my job

EE.5 I feel positive about my job

EE.6 I am excited about my job

iv The Cognitive engagement scale consists of 4 items as follows

CE.1 At work, my mind is focus on my job

CE.2 At work, I focus a great deal of attention on my job

CE.3 At work, I am absorbed my job

CE.4 At work, I concentrate on my job

v The Job performance scale consists of 4 items as follows

JP 1 I meet formal performance requirements of the job

JP 2 I fulfill responsibilities specified in job description

JP 3 I perform tasks that are expected to me

JP 4 I adequately complete assigned duties

3.3 Translation of the questionnaires

The first draft of questionnaire was developed in English It was then translated into Vietnamese During the translation, some references to previous researches of POS and job performance with mediators in Vietnam market have been made to improve the reliability and consensus of the items

The questionnaire is translated into Vietnamese for all of the people we contact to get information are Vietnamese, also by translation into Vietnamese it can ensure that the contents of the questionnaires are fully conveyed to the answerers

The final version of questionnaire was made in Vietnamese (Appendix 1) and then was translated back into English (Observed variables)

Steps of translation:

- Questionnaire development in English

- Questionnaires reference from previous researches

- Self transudation from English to Vietnamese

- Getting translation check from the official translator

- Translation from Vietnamese to English for checking

- Final version of questionnaire made in Vietnamese

- Final check

3.4 Variable Control:

Because the data was delivered from self-rating, it was important to control potential biasing the influences (Bommer, Dierdoff, & Rubin, 2007) Bias affects research in many ways It can alter how subjects are selected for a study, it can alter how the researcher views data, and it can certainly lead to researchers excluding data which negates their hypothesis

Variables in this study were generated based on previous studies that were discussed

in the literature review, consultancy of experts and managers in HR and banking management Variables for final analysis in this study are quantitative variables; being divided into independent, dependent, mediation factors, specifically: 1 Perceived organizational support, 2 Job performance The relationships among these variables

are measured through three mediation variables: 3 Physical engagement, 4 Emotional engagement, 5 Cognitive engagement

To support variables control and to ensure accurate estimate of the relationship between variables, it is necessary to select an appropriate and satisfactory sample, not

biased and can be representative of the population from which is drawn To ensure the estimate of the relationship is less likely to be biased, we respect a high participation rate in a sample selected randomly from a population Appropriate measurement scales a r e u sed for this study, specifically a pool of 35 candidate scale items to reflect relation mentioned were selected with a seven-point Likert scale, which ranges from 1-strongly disagree to 7-strongly agree, was used in this study

In this study, as an indispensable tool for potential biasing control and for data analysis, reliability statistics by Cronbach’s Alpha (Hair et al, 1998, Segar, 1997) is applied to test

3.5 The pilot study

A pilot experiment, also called a pilot study, is a small scale preliminary study conducted in order to evaluate feasibility, time, cost, adverse events, and effect size (statistical variability) in an attempt to predict an appropriate sample size and improve upon the study design prior to performance of a full-scale research project (Hulley, Stephen B Designing Clinical Research Lippincott Williams & Wilkins, 2007, p.168-

169)

Pilot study is usually carried out on members of the relevant population, but not on those who will form part of the final sample This is because it may influence the later behavior of research subjects if they have already been involved in the research (Haralambos and Holborn 2000, p.998)

Pilot studies applied based on quantitative and qualitative methods, starting with

"qualitative data collection and analysis on a relatively unexplored topic, using the results to design a subsequent quantitative phase of the study" (Tashakkori & Teddlie 1998) The first phase of a pilot involves using in-depth interviews or focus groups to establish the issues to be addressed in a large-scale questionnaire survey Next the questionnaire, e.g the wording and the order of the questions, or the range of answers

on multiple-choice questions, are piloted A final pilot is conducted to test the research process, e.g the different ways of distributing and collecting the questionnaires Pilot study also aims to identify potential practical problems and improve the internal validity of a questionnaire

In this study the steps used to pilot a questionnaire are applied on small group of person who are experts in the field of this study (HR Management, Banking management) and similar to the target population In this study, HR Directors, managers of Banks are person to be contacted for pilot study for they can provide different and diversified perception opinion

Banks we aim to manage pilot study are Vinasiam bank-the bank I am working for more than 10 years, other banks are Sacombank, Saigonbank, Agribank Person we contact for pilot study are HR managers, HR seniors staff of these banks The pilot study will be made separately from bank to bank, from person to person and the result will be collected final selection

3.6 Target population

The target population is the population of individuals which we are interested in describing and making statistical inferences about (Johan Hedal, Susie Jentoft 2011) The target population is the entire group that we are interested in; the group about which we wish to draw conclusions Target population for a survey is the entire set of units for which the survey data are to be used to make inferences (Cox and Cohen 1985) Thus, the target population defines those units for which the findings of the survey are meant to generalize Establishing study objectives is the first step in designing a survey, and defining the target population is the second step

Details of target population of this study:

- Geographical area: Ha Noi Capital, Da Nang City, Dong Nai Province, Binh

Duong Province Ho Chi Minh City

- Age: from 20 - 60

- Gender: male and 55 female

- Education: College / vocational degree, university degree and higher levels

- Position: staff, experts, senior staff, Deputy Directors, Managers, Deputy

managers

- Eligibility: functional employees, mangers who are working for Sacombank,

Saigonbank, Agribank, Vinasiam bank

3.7 Sample size:

As mentioned above, this study exam the impact of perceived organizational support

on Job performance, the mediation of job engagement- a study of Commercial Banks

in Viet Nam The study was carried out through quantitative research methods The questionnaire survey was used to directly interview the subjects from a sample size of

200 person who are working in commercial banks in Viet Nam

According to Donald & Pamela (2003), a good sample should satisfy both accuracy and precision On the one hand, it should bring little or no systematic bias in variance, and on the other, the sampling error should fall within acceptable limits for the study’s purpose

There is no consensus in the literature on how large the sample size should be to represent a population A host of formulas to calculate the sample size are provided, but they are not easy to apply The sample size is determined by the level of precision and confidence desired in estimating the population parameters, as well as the variability in the population itself (Canava et al., 2001)

The sample size for this study was intended to be 200 (equal 8 times of observed variables) This number was decided after considering some previous researches For example, see Tho & Trang (2008, p.35) or Trong & Ngoc (2005, p 263) To obtain the desired sample size, a total of 300 self-administered questionnaires were distributed to the respondents by bank employees Of these, 250 questionnaires were returned; of which 50 were useable, making effective response rate 47.2%

3.8 Selecting the sample and collecting data

The basic idea of sampling is that by selecting some of the elements in a population we may draw conclusions about the entire population Some considerations for selecting the scope and methodology for sampling are cost, the accuracy of results, the speed of data collection and the availability of population elements (Donald & Pamela, 2003) The first step in sampling is that the population should be correctly defined A population is the total collection of elements from which we wish to draw some conclusion

After identifying the population, researchers will choose an appropriate sampling

available Two most common sampling techniques are probability sampling and non- probability sampling

Steps of sample selection: Define target population > Construct sampling frame > Determine how to select sample members > decide how to covert sample estimates into population estimates

In this study, the population for it is limited to staff working in commercial banks in Viet Nam However, it is impossible to identify all the customers that make up the whole population, or to establish a sampling frame that includes a large proportion of the population Due to the tremendous limitations of time, budget and knowledge; this study uses a non-probability sampling technique, specifically, convenience sampling This is one of the least reliable sampling techniques, but it is the cheapest and easiest, and is the most feasible for this study Sample method in this study is non-probability sampling The sample selected includes 200 person who are HR managers, banking employees from Head office and branches of Sacombank, VinaSiam Bank, Agribank Interviewers can interview any staff who agrees to take part in the interview

Selecting an appropriate and satisfactory sample will help to support variables control, avoiding error in measurement which can lead to false in study result As we mentioned above, it is important to ensure that the sample is not biased and be representative of the population from which is drawn The estimate of the relationship

is less likely to be biased if we have a high participation rate in a sample selected randomly from a population To ensure the sample is not bias, sample selection in this study was implemented based on the following principles:

- Selection bias: Avoiding this bias by ensuring that select samples can present for the population of the study

- Confounding: subjects of the study are separated into different group to ensure no confounding

- Information bias: Scale applied for different group must be utility

Data collection: Data for this study was collected by using a survey technique Survey technique “provides a quick, efficient and accurate means of assessing information on

a population, especially in the case of a lack of secondary data” (Zikmund, 1997)

After having decides sample, we apply both ways face- to- face interviews and sending questionnaires (mainly) to collect data

3.9 Methods of data analysis

3.9.1 Data screening

After collecting having data, data were screened, variables were encoded and input for further processing

3.9.2 Normal Distribution Examining

With a sample size of N = 200, if Skewness and kurtosis of measured variables distributed in the interval (-2, +2) the data can be considered to meet the suggested cut-off for normal distribution

3.9.3 Reliability of scale

In statistics, reliability is the consistency of a measure A measure is said to have a high reliability if it produces consistent results under consistent conditions.

+ Reliability Statistics by Cronbach’s Alpha (Hair et al, 1998, Segar, 1997)

Cronbach's (Alpha 1951) is a coefficient of reliability It is commonly used as a measure of the internal consistency or reliability of a psychometric test score for a sample of examinees

In this study, to measure the impact of Perceived Organizational Support on Job Performance, the Mediation of Job Engagement, this study adapt the scale developed

by Bruce Louis Rich (2010) and Robert Eisenberger, Stephen Armeli, Barbara Rexwinkel, Patrick D Lynch, and Linda Rhoadesm (2001) Some complement and elimination have been done after discussion with the bank experts and staff in group discussion to ensure the conformity with context of commercial banks in Viet Nam, local culture and others concerned

3.9.4 Confirmatory factor analysis (CFA) & Structural equation modeling (SEM)

Confirmatory factor analysis (CFA) is conducted for measurement instrument with Amos 16 When the measurement model is ensured to describe the sample data

adequately (i.e., model fitting), it is more confident in findings related to the assessment of the hypothesized structural model (Byrne, 2001)

SEM is one of the most complex and flexible technique to analyze casual relation model (Structural Equation Modeling) using a combination of statistical data and qualitative causal assumptions SEM has been widely used in many fields including management (Tharenou, Latimer and Conroy, 1994)

The nessessity to apply SEM for the research: SEM model combines all techniques

such as multi-variable regression, reciprocal relationship analysis (between factors in a model) which allow us to estimate complex relation in a model SEM is known as analysis of covariance structures, or causual modeling, a combination of factor analysis and multiple regressions The variables in SEM are measured (observed, manifest) variables (indicators) and factors (latent variables) SEM can be divided into two parts The measurement model is the part which relates measured variables to latent variables The structural model is the part that relates latent variables to one another

Different from other statistical techniques which only allow us to estimate relation of separated pair of factors, SEM allow us to simultaneously estimate relation of all factors in a general model, estimate causal relation of latent constructs by applying goodness-of-fit (GOF) indices for both measurement model and structural model SEM also helps to measure recursive relation and non-recursive relation; measure direct and in-direct relation, including error and disturbance

With technique of Confirmatory factor analysis (CFA), SEM model helps us to flexibly find out the most appropriate model among the proposed models Strong and advanced points of SEM are the reasons why we apply SEM for our research, especially when our research model pursues complex relations among factors and mediators

In this study, to measure the relevance of the model and to test the model fit, the following fit indices that present the goodness-of-fit (GOF) indices are put into consideration:

· P value

P value is associated with a test statistic It is the probability of observing a test statistic The smaller the P value, the more strongly the test rejects the null hypothesis, that is, the hypothesis being tested A p-value of 05 or less rejects the null hypothesis (or to show the relationship existed)

· Chi-Squared (χ2) is the fundamental measure to qualify the differences between the observed and estimated covariance matrices Conceptually it is a function of the sample size and the difference between the observed covariance matrix and the model covariance matrix

CMIN/ df (χ2/df): Chi-square adjusted following degree of freedom

In which df: Degree of freedom represent the amount of mathematical available to estimate model parameters

i) χ2 represents the appropriate level of the entire model at significance level pv = 0.05 [Joserkog & Sorbom, 1989] This case is unlikely because χ2 is very sensitive to large sample size and to the strength of the test measure, so in fact χ2 /

df is used instead

ii) χ2/df is used to measure appropriate level of the model Some authors suggested 1<χ2/df<3 (Hair et al, 1998) The others suggested χ2 should be as small as possible (Segar, Grover, 1993), and assume that χ2/ df <3:1 (Chin & Todd, 1995) Also, in some empirical studies, the studies are distinguished in to two cases: χ2/df <5 (for sample size N> 200) or <3 (when sample sizes N <200), then model is considered good fit (Kettinger and Lee, 1995)

· Comparative Fit Index (CFI)

CFI is an incremental fit index that is an improved version of the normed fit index (NPI) CFI comparing appropriate indicators In examining baseline comparisons, the CFI depends in large part on the average size of the correlations in the data If the average correlation between variables is not high, then the CFI will not be very high A CFI value of 90 or higher is desirable

· Tucker Lewis Index (TLI) or Non-normed Fit Index (NNFI)

The TLI predates the CFI and is conceptually similar in that is also involves a mathematical comparison of a specified theoretical measurement model and based line null model A model with good fit has that approach 1

· Goodness-of-Fit Index (GFI): attempts to produce a fit statistic that was less sensitive to sample size The possible range of GFI values is 0 to 1with higher values indicating better fit

Indices: CFI, TLI, CFI, having value> 0.9, is taken to indicate good fit If these values are at 1, we say the model is perfect (Segar,Grover, 1993) & (Chin & Todd, 1995)

· Root Mean Square Error of Approximation (RMSEA)

RMSEA is to attempt to correct for the tendency of the χ2 GOF test statistic to reject models with large samples or large number of observed variables It presents how well a model fits a population, not just the sample used for estimation It explicitly tries to correct for both model complicity and sample size

by including each in each computation Lower RMSEA value indicates better fit RMSEA: is an important indice, it determines the relevance of the model

compared to population In IS Research Journals, the authors assume that the if indices RMSEA, RMR <0.05 the model is considered good fit In some cases if these value <0.08 the model can be accepted (Taylor, Sharland, Cronin and

Bullard, 1993)

· Modification Indices (MI)

The results of the CFA test by using AMOS are also implemented based on the principles to adjust relations with MI> 4 (MI-Indice Modification is an adjustment coefficient for the change of χ 2

per each level of freedom)

MI suggests remedies to discrepancies between the proposed and estimated model

MI adjusts the change of χ 2

for each addition of possible relation (with one degree

of freedom) If Δ χ 2> 3.84 (corresponding with one degree of freedom) it allows for an additional relation to improve the good-fit for the model (Hair et al, 1998)

Researchers should be cautious because the added relation to the model may only

be accepted when it support the theory, thus researcher should not, by all means, try to make the model more suitable (Bullock et al, 1994; Hair et al, 1998) Good indices indicate good fit of the model, but it does not mean that the model chosen

is correct or the best model among the feasible theoretical model

In this study: we look to the modification indices for the covariances We covary error terms with observed or latent variables, or with other error terms so as to improve the good-fit for the model The largest modification indices are addressed first before addressing more minor ones

For every step of covarying, we re-run the model then consider the other possible error-pairs to be covaried for improving chi-square Covarying (hooks) between suggested error- pairs help to reduce the amount of Chi-square of the original model The GFI, TLI, CFI, RMSEA then will also be improved However, not many covarying (hooks) are made in our models to ensure the adjustments of theoretical and practical implications

The model is considered appropriate to market data when tested with Chi-square, value> 0.05 Tho & Trang (2008) suggested that if a model gets the value of TLI, CFI

P-≥ 0.9, CMIN/ df ≤ 2, RMSEA ≤ 0:08 the model match (compatible) with market data

In brief, if a model gets the values of: P-value < 0.05, GFI, TLI, CFI ≥0.9 (Bentler & Bonett, 1980), CMIN\df ≤ 2, for some cases CMIN\df or can be ≤ 3 (Carmines & McIver, 1981), RMSEA ≤ 0.08, the model is considered good fit (Steiger, 1990) and matches with market data

Remark: Title for models Chi-square= \cmin ; df= \df ; P= \p ; Chi-square/df = \cmindf ; GFI = \gfi ; TLI = \tli ; CFI = \cfi ;

RMSEA = \rmsea

(Please see details of formulas in Appendix No 6)

Steps of CFA in model good fit test in this study:

1 Construct reliability

2 Unidimensionality (Tính đơn hướng/ đơn nguyên)

(Giá tr ị liên hệ lý thuyết)

6 Accessing model validity -Accessing measurement model validity -Accessing structural model validity

7 Conclusion of model test

(1) Construct reliability or Composit reliability (CR) (Lu et al., 2005and Hair et al.,

1998)

Construct reliability is a measure of internal consistency of the construct indicators, depicting the degree to which they indicate the common latent variable To test the reliability of the constructs, this study reports construct reliability (CR) and Average Variance Extracted (AVE) AMOS does not output the construct reliability and average variance extracted directly, thus they are calculated as the following (Fornell

&Larcker, 1981):

(2) Unidimensionality (Tính đơn hướng/ đơn nguyên)

According to Steenkamp & Van Trijp (1991), the relevance of the model with market data provide us necessary and sufficient conditions for the collective variables

achieving Unidimensionality, except where the error of the observed variables

correlate with each other

(3) Convergent validity (Giá tr ị hội tụ)

Convergent validity: The items that are indicators of a specific construct should

converge or share a high proportion of variance in common, known as convergent validity

The measurement model provides evidence of convergent validity when: Firstly, all the item/ indicator have standard regression weight above 0.5, and regression weights (unstandardzed regression weights) are significant (P-value <0.05) (Gerbring & Anderson 1988) Secondly, all construct reliability of the construct (CR) are greater than 0.7 and all the average variances extracted (AVE) are greater than 0.5 (Bagozzi &

Yi, 1988)

The "average variance extracted (AVE)" is an indicator of convergent validity, it measures the amount of variance that is captured by the construct in relation to the amount of variance due to measurement error and can be calculated using the following formula: (summation of squared factor loadings)/(summation of squared

factor loadings) (summation of error variances) (Fornell & Larcker) If the average

variance extracted is less than 50, then the variance due to measurement error is greater than the variance due to the construct In this case, the convergent validity of the construct is questionable This mean the AVE must higher than 50 to meet Convergent validity

With CFA, the average variance extracted (AVE) is calculated as the mean variance extracted for the items loading on a construct and is a summary indicator of convergence

This value can be calculated b y using standardized loadings:

Construct reliability (CR) Reliability is also an indicator of convergent validity Estimates of the reliability and variance extracted measures for each construct are necessary to assess whether the specified items sufficiently represent the constructs (Lu et al., 2005) Confirmatory factor analysis (CFA) within Structural Equation Modeling (SEM) is a common method of estimating construct reliability CR is > 0.7 (Hair et al., 1998) CR is computed from the squared sum of factor loadings for each construct and the sum of the error variance terms for a construct:

Li: Standardized factor loading

e i: measurement error = [1 – (standardized loading) 2 ]

In brief, if the model get CR>0.7 and AVE> 0.5, the model is considered accessing Convergent validity

(4) Discriminant validity (Giá tr ị phân biệt)

Discriminant validity is the extent to which a construct is truly distinct from other constructs Thus, high discriminant validity provides evidence that a construct is unique and captures some phenomena other measures do not CFA provides way of assessing discriminant validity

We can perform testing on the correlation coefficient at the overall range between the concepts to find out if there is real difference from 1 or not If there is really difference from 1, the scale achieves Discriminant validity

Correlation coefficients between concepts all <1 and statistically significant

(sig.<0.05) indicate that concepts access Discriminant validity (Nguyen Dinh Tho,

2003)

The way to conduct whether the correlation coefficient is different from 1 or not can

be calculated by Excel

(5) Nomological validity (Giá tr ị liên hệ lý thuyết)

For Nomological validity, it is defined based on the research model, scales of the antecedent studies

Also, if the results in the Maximum Likelihood Estimates show statistically significant (p<0.5%), significant existence of relation among concepts, constructs This result indicates that the measurement scales of concepts of the research model satisfies theoretical implication, thus satisfy the Nomological validity

(6) Model good fit test:

Two step SEM process:

- Measurement model test: an approach to SEM, measurement model fit and construct validity are first assessed using CFA