Improving developer performance: a study of low performance of production team of SMI Company

With the outstanding development of Internet, the Information Technology industry is considered as special advantage of Vietnam as well as spreading, promoting the development of many industries and economic aspect. Therefore, this is also a good opportunity for young people who are passionate, creative and interested in learning in technology industry to explore their skills. Information Technology (IT) is a collection of modern scientific methods and technical tools mainly computer and telecommunication techniques to explore and use all the effective and potential information resources in all areas of human and social activities. In addition, with the globally connected internet, the IT industry has become an integral part of the development of todays society Therefore, with the fierce competition in this industry, the developers, coders are required to enhance their continuous innovation to catch up with the development of the IT product markets. This puts a lot of pressure on the employee in this field especially when they are in charge of developing new technology products services, because it requires differentiation, sensitivity and constant updating of innovation to maintain their business in the IT market. When a new technology product that has been built for months and it did not get high results from the market, it would be considered, as failure product and the developer need to continue to build the new one. If this happens for several time, the team will be in the results of low performance. This is also an ongoing problem of Production team of SMI Technology Company. So by this report with the uses for both primary research and secondary research to analyze more about the business activities of technology industry in general and the production team of SMI Technology company in particular to learn more about how the team deal with the low performance as mentioned above. Thereby, the report further analyzes the causes that can lead to low performance of the team as well as provide solutions recommendation to improve the cohesion of the developer, coder of SMI Company.

APPENDIX 3: Thesis cover page

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Duong Tran An An

IMPROVING DEVELOPER PERFORMANCE: A STUDY OF LOW PERFORMANCE OF PRODUCTION

TEAM OF SMI COMPANY

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – Year 2020

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

Duong Tran An An

IMPROVING DEVELOPER PERFORMANCE: A STUDY OF LOW PERFORMANCE OF PRODUCTION

TEAM OF SMI COMPANY

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: Assoc Prof TRAN HA MINH QUAN

Ho Chi Minh City – Year 2020

TABLE OF CONTENTS

EXECUTIVE SUMARY 2

ACKNOWLEDGEMENT 3

LIST OF TABLES & FIGURES 4

I INTRODUCTION 5

1 COMPANY PORTFOLIO 5

2 COMPANY STRUCTURE 6

3 COMPANY VISION 7

4 INFORMATION TECHNOLOGY INDUSTRY 8

II PROBLEM CONTEXT 8

1 RECOGNIZED SYMTOM 8

2 POSSIBLE PROBLEM 11

III PROBLEM IDENTIFICATION 11

1 FAILURE PRODUCT 11

2 UNTRACTIVE SALARY AND BONUS 13

3 INEFFECTIVE PERFORMANCE APPRAISAL 16

4 LACK OF LEADERSHIP 19

5 CAUSE – EFFECT MAP 21

IV CAUSE VALIDATION 22

V RECOMMENDATION/ SOLUTIONS 26

1 Set up Effective KPI for Production team 26

2 Training Team Leader 27

VI ORGANIZATION OF ACTIONS 29

VII CONCLUSION 30

VIII SUPPORTING INFORMATION 31

REFERENCE 46

EXECUTIVE SUMARY

With the outstanding development of Internet, the Information Technology industry is considered

as special advantage of Vietnam as well as spreading, promoting the development of many industries and economic aspect Therefore, this is also a good opportunity for young people who are passionate, creative and interested in learning in technology industry to explore their skills Information Technology (IT) is a collection of modern scientific methods and technical tools - mainly computer and telecommunication techniques - to explore and use all the effective and potential information resources in all areas of human and social activities In addition, with the globally connected internet, the IT industry has become an integral part of the development of today's society

Therefore, with the fierce competition in this industry, the developers, coders are required to enhance their continuous innovation to catch up with the development of the IT product markets This puts a lot of pressure on the employee in this field especially when they are in charge of developing new technology products/ services, because it requires differentiation, sensitivity and constant updating of innovation to maintain their business in the IT market When a new technology product that has been built for months and it did not get high results from the market,

it would be considered, as failure product and the developer need to continue to build the new one

If this happens for several time, the team will be in the results of low performance This is also an ongoing problem of Production team of SMI Technology Company

So by this report with the uses for both primary research and secondary research to analyze more about the business activities of technology industry in general and the production team of SMI Technology company in particular to learn more about how the team deal with the low performance as mentioned above Thereby, the report further analyzes the causes that can lead to low performance of the team as well as provide solutions/ recommendation to improve the cohesion of the developer, coder of SMI Company

ACKNOWLEDGEMENT

I would like to express my thank to my dear mother, my husband, my son, my colleagues at SMI company, my classmates and all the teachers at ISB for empowering me, helping me to achieve the successful study that I have completed today

Especially, I would like to express my depth thanks to my supervisor - Professor Tran Ha Minh Quan for supporting, guiding me during the past 06 months with his extremely busy schedule Without his dedicated guidance, I would not have been able to complete this report to achieve the goal I have set for the past two years Without this amazing support, I could not accomplish this great goal of my life

Thank to Professor Tran Ha Minh Quan Wish him a good health to continue on the journey of the great education development for the next young generation

LIST OF TABLES & FIGURES

Table 1: Sale Revenue from 2015 to 2019

Table 2: Problem that lead to low performance of Production Team

Table 3: Testing report from 2016 – 2019

Table 4: Employee status in 2016, 2017, 2018, and 2019

Table 5: Performance appraisal from 2016 – 2019

Figure 1: Company structure

Figure 2: The current age ratio of the production team

Figure 3: The circle life of a new product

Figure 4: Cause – Effect Map

I INTRODUCTION

1 COMPANY PORTFOLIO

SMI Technology, a US-invested company specializing in product development and software outsourcing Starting with only few members after 10 years of operation in Vietnam, SMI has built

a team of more than 1000 employees with years to be honored with Top 10 Sao Khue award

In addition, SMI was voted as the top 5 IT companies and top 32 best workplace in Vietnam based

on salary, bonus and welfare criteria; development opportunities; leadership team; culture and values; work life balance and company reputation with the popular product developed by: qTest, Kobiton, Katalon, Witurn and many more will be coming soon

The concept of "value" in SMI is not only limited to technical, project and business scope but also expressed the mission to support Vietnam's technology industry with more innovative products and services, SMI always gives priority to community activities to build and develop these values for IT human resources

Over the past decade with the vision of global company, SMI Technology has launched many

"made in Vietnam" products that have made a mark on the international market, in addition to its global customer base from the outsourcing segment

These are included: QASymphony, which received a $ 40 million investment in 2017, then merged with Tricentis and officially became the Unicorn start-up in 2018 In addition, other applications developed by SMI's Vietnamese engineering team such as Kobiton have also received a $ 3 million investment from Kinetic Venture Capital (USA); or Katalon has nearly 35,000 global business customers

In order to continue to promote the strengths in the outsourcing and development of software products, SMI is expanding the sales team in the Australian market and Asian market

In these markets, SMI specializes in consulting and providing solutions for data management and analysis; Supply chain management solutions and software quality management consulting, target

to the mid-range customer segment and potential markets across Asia

SMI Technology focuses to actively implements career and training programs, associates with universities to support students with real-life project knowledge and experience from the study time

In addition, the company also seeks a number of partners, working with non-profit organizations, with the desire to create a talent software engineers from that lack of conditions in remote areas

By investing 05 new offices in Vietnam with a global working environment standard, SMI also focuses to build a professional corporate culture with training and people development program

with many interesting activities which the purpose to maintain and develop the company for a billion-revenue company

With the commitment to develop IT resources, SMI also support to create the best condition for employees for the opportunities to:

 Learn: by giving opportunities, challenge for programmers to learn, and explores their skills

 Develop new product: All members at SMI are involved in contributing ideas for the product they create

With the purpose to provide best working environment with: open minded – dynamic and professional workplace for all employees and bring high quality job opportunities for Vietnamese engineers and programmers, SMI is proud of to be the leading Technology Company in Vietnam for the next ten years with a billion revenue company

2 COMPANY STRUCTURE

SMI is a technology company for the company’s structure is quite simple, under Board of Director;

it will be divide to 02 Business Units as below:

 Corporate Service, and

 Delivery Service

Corporate Service is back office function with Finance, Admin, HR, Sales& Marketing, IT, Procurement Department

Delivery Service has Our-sourcing service, Production and Solution Department

 Out-sourcing service: This is the main profitable department for the company through

providing services to customers such as technology outsourcing, providing maintenance software, maintenance services, upgrade system, risk evaluations and repair the system

 Production: This is a department of young, newly graduated employees, bringing many unique ideas and initiatives to create new and strange technology products, software development to attract investment from consultants, customers

 Solution: This is a specialized department in charge of important projects such as integrating system software of companies together in the process of merger and acquisitions among technology companies

The two parts of Out-sourcing and Solution are the two main revenue drivers for the company to maintain the business situation The Production department is mainly the one that the company has invested a lot of money in to create innovative technology products to get the investment from the client, investor or sell the product to the market

3 COMPANY VISION

 To be a visionary global technology group with a portfolio of innovative service and product business

 Provide guidance and support to our staff to help them define and reach their potential

 Achieve success by creating value and marking a positive impact on the success on our customer and clients

 Provide tangible contribution and improvement to our communities

4 INFORMATION TECHNOLOGY INDUSTRY

Information technology is constantly developing so far, so the demand for human resources is quite huge Most organizations, companies, businesses need employees in the field of Information Technology Typically as:

 Software companies that research, build, develop and provide software, website, applications, games - Companies manufacturing, assembling and repairing hardware equipment

 Companies provide integrated solutions

 Companies provide network solutions and network security

 Administration Department, IT department at companies, including companies operating

in the field of Technology and other fields

With the fierce competition from domestic and foreign competitors, typically with the type of companies specializing in providing outsourcing services like SMI, we can mention strong competitors as: LogiGear, Harvey Nash, Sunrise, FPT, DEK technology, Global Cybersoft, TMA solution, IVC

Therefore, SMI always seeks and continuously improves the quality of services to meet the high demands from customers and constantly invents advanced technology products with practical benefits for maximum profits and increase SMI's competitive advantage in the market

The labor market in the programming industry will need 350,000 resources by the end of 2021 while currently only about 200,000 resource can meet the needs of the job

Lack of IT resources is always a big problem of the IT market, although the trend of wages and benefits is increasing sharply for this industry, but many experts predict that in 2020 Vietnam will still lack from 70,000 to 90,000 headcount for this industry

II PROBLEM CONTEXT

1 RECOGNIZED SYMTOM

Every company had its own problems and this study was only focused on a Production department where the company invested a lot of money, time, effort with the purpose to bring advanced technology products to the technology market to get the high revenue to sustain the business for the company

Production Department is a team with around 40 members that have been invested for past years

by SMI Investment Fund with the purpose to develop technology products and deliver them to market to approach customers and call for investing to the product or sell completely to investor

By interviewing with the DIRECTOR of SMI through intake meetings, he proposes that the current symptom of SMI’s production team is that the actual performance of developer is lower than target

Recently, the team revenue has decreased significantly and this situation may continue to occur,

so the company needs to find out the cause to overcome this situation

Because of low revenue so for 03 year recently, the member of Production team did not have any bonus, it was also one of the reason that lead to the low performance of production team

Since 2017, all the technology product could not satisfied the requirements of customers, so a huge

of customers cancelled the products and services of SMI, thereby affected to the company's revenue as table 01 below:

Table 1: Sale Revenue from 2015 to 2019

(Source: SMI New Production Revenue from 2015 - 2019)

A circle life of Technology products was quite short If the product did not make any satisfaction

to the client, reach to the high revenue from the market or call for the investment from the investor, the product would be considered as failure product and would be closed to upgrade to save time and effort of the team as well as saving money for SMI

Production team is a subsidiary of the SMI group of about 40 people, with the majority of employees are very young As Director of SMI confirmed that the resource in the information technology industry require skills that are completely different from other industries such as young, intelligent who do not need experience but need a breakthrough ideas Because of these factors, IT personnel are often selected as young, newly graduated or only have 1 or 2 years of experiences The current age ratio of the team will be shown as below:

The table shows that most of 75% employees of the team are under 25 years old, this is also the requirement of production team And because of young generation without experience and behavior, training so they often do not know how to behave or control emotions when working in

an office environment that requires the professional mindset as following:

 Some might feel uncomfortable while working with these ridiculous one

 Some are so quiet and only communicate to each other when needed, they are lack of socialize, or deny to join the company activities,

 Some staff just work and work then go home

 Some staff just want to enjoy and work with emotion

In order to analyze the problem, there were 12 in-depth interview conducted with 4 main groups

as below

- The first group: 02 members: Director and Sales and Marketing managers

- The second group: 03 members: HR manager, Development Manager, Leader

- The third group: 04 members of Production Team

- The fourth group: 03 low performance members

2 POSSIBLE PROBLEM

Beside the interview of 04 groups above, Production team also conducted an internal survey to get

more data as well as the problem why the performance of production team did not meet the

company’s expectation as table 02 below This table is shown 04 main points that have high voting

from the team

Table 2: Problem that lead to low performance of Production Team

(Source: SMI Internal Survey for Production Team)

By looking at the statistical numbers of the survey above, it showed many problem affecting low

performance of Production team: Unattractive salary & bonus, Ineffective performance appraisal,

Failure Product, Lack of leadership This is true data based on the interview information, the

confirmation from all team members of production team

So this report will use these primary and secondary data to analyze the current problem of the

production team as well as the main cause of this problem to provide the solution/recommendation

for the Board of Director of SMI company

III PROBLEM IDENTIFICATION

1 FAILURE PRODUCT

A new product at SMI will be defined as a failure product when a new product has the testing

report shows the satisfaction ratio of the product is lower than 50% for several testing times, the

product will be considered as failure product and need to re-built to reach to 70% of high

satisfaction results otherwise the Management decide to stop to develop the app and start a new

Ineffective Performance Appraisal

Lack of leadership skills

Failure Product Unattractive Salary & Bonus

A sample circle life of a new product will be shown as below:

Spynkal is one of the typical technology products to give an example of a failure product problem Recently, the production team had an idea to build a new product named as Spynkal- an app like Facebook by few month incubation and then it announced to all members of SMI for testing before Spynkal approached to the client or technology market When Spynkal did not achieve highly satisfaction-testing results from the testers, production team need to upgrade new function of the app or even change some features until the Spynkal get high testing results

Spynkal was still taking longer than 06 – 08 months, the product would be considered to be closed and start to build a new one It took a lot of time and effort of the team and did not bring any successful so the Board of Director of SMI company will define Spynkal was a failure product The Director of Production team also said that:

“The quality of products plays the most important role to make customer satisfaction and bring the success for the company Additionally, if the quality of product is stable, and meet the core value for the need of client so the sales team, so we are not confident to introduce products to them Besides that, stable quality products will bring satisfaction for customers and now we are facing to failure product and cannot approach them to the client”

Riaz and Tanveer45 stated, “Product is something or anything that can be offered to the customers for attention, acquisition, or consumption and satisfies some want or need”

Reed, Lemak and Mero43 suggested that delivering high product quality to customers is a key strategy for improving performance in a competitive environment

Chauhudri and Holbrook8 pointed that a customer who trusts in a product is more likely to remain loyal to it and spread positive word-of-mouth

Meanwhile, Boulding et al.3 suggested that there is a direct effect of product quality on loyalty A high level of product quality often brings satisfaction for customer Therefore, failure product might put a negative impact on the experience of SMI customer and affect SMI revenues

Re-test

Consider

to close Low results

Close

Re-test Low results

In 2004, Kotler28 suggested that “a product should be viewed in three level: core product, actual product and augmented product”

 Core product means that the core value that the product could offer like purchasing massage chair is buying relation or comfortable moment

 Actual product means that product could bring differential advantage from its competitors

 Augmented product means that non-tangible benefit of possessing product like discount or customer service and so forth”

Below is a table 3 - testing report in recent years from 2016 to 2019, to show that the new products produced by the production team mostly get unsatisfactory test results

Table 3: Testing report from 2016 – 2019

(Source: SMI Testing Report for New Production)

From the unsatisfactory test results from the internal tester of the company and potential customers, the product did not bring high profits for the consideration of SMI's Management team to allow the production team to continue to develop the product With the result of the low product performance, these products will be considered as the failure products They will be in pending mode for the future upgrade or stopped by the final decision of the SMI management team

2 UNTRACTIVE SALARY AND BONUS

Salaries and bonuses are never enough for an employee; they always want to receive salaries and bonuses higher than their current one So in this report, it is very important to find out how it affects to the low performance of the production team

The production team is compensated in two main parts: monthly salary and KPI / product performance Monthly salary is paid whether or not a new product is made and the bonus is paid according to KPI, job/product performance Recently, because no outstanding products have been

released to the market, most of the production team's salaries receive only a monthly base salary that why in the survey, they mentioned one of the reason that they had low performance is unattractive salary and bonus

Unequal remuneration is also a factor that reduces the productivity of the team and leads to an increase in the rate of job vacancies at the company

And from the perspective of Mr Nguyen Huu Minh - Developer Manager:

“The demands of customers are increasing, but the products have too many errors with the use is not optimal and products are note attracted to get more investment to maintain the product circle or sell to the market Since the Total Quality Management of our product is not good and it will affect the company and team performance, salary and bonus

There are theoretical link have the relationship between performance and competitive advantage

as metioned in Curkovic & Pagell11; Feigenbaum 16,17; Noori38; Seawright & Young50

Therefore, the resource of employees in the production team is fluctuating, the turnover and new recruiting is significantly up and down by this cause and shown as table 4 below:

Table 4: Employee status in 2016, 2017, 2018, and 2019

(Source: Production Employee Status from 2016 - 2019)

Based on a survey by HR Consultancy Anphabe59, the turnover rate is fluctuating at 10% is the best ratio for businesses to stabilize their personnel and create a change in personnel every 10 years Based on the figures provided by SMI HR for Team Production's member status in 2016 -

2019, it can be seen that the average turnover rate is from 10 to 20% of the total number of employees in the group, this is determined that turnover rate is quite high As provided above, the age of Team Production's employees is quite young, about 75% under 25 years old, so the stability

is quite low, so SMI company is having difficulties in maintaining personnel and costing a lot budget for alternative recruitment

The member of Production team also in a bench for available back up to re-fill the number of staff

of Outsourcing and Solution department in case the number of employees of these departments are resigned

They are back up resource of the short time for the project during wait for new recruitment process from HR Department to ensure the number of headcounts that have agreed with customers/client for each project are stable or available to make sure all processes are completed in proper manner period

So the resource of Production team is not stable It is also lead to high turnover rate that greatly affect to the team's performance

The turnover rate of employee is constantly affected to the workflow of the remained team members Once one of the member of the team resigned, the remain members need to back up the work progress to make sure the progress is running smoothly This may reduce the quality of work

of back up members and effect to the product quality

This is also effect to the recruitment costs, time, and effort of Human Resource Department to recruit new replacement in particular and in company's revenue in general

3 INEFFECTIVE PERFORMANCE APPRAISAL

The performance of production team is considered as major problem that had been solved over the past years because most of them were young and inexperienced so they make mistakes from their inexperience and this will affect the quality of the products when the product is in production progress, but these young employees have the energy, creativity, knowledge, willingness to learn,

a potential resource to develop so the company still wanted to maintain and continue to train them for few years with the purpose of promoting them to create a quality product to attract investors like other previous products they have built before

An in-depth interview with HR manager has been conducted and she said: “

“Team products' target are frequently changed to match the nature of the work and ineffective performance appraisal is demotivated the employee to perform the best performance”

“In production team the performance appraisal is quite difference from other department

If one member A of the team is less expertise than other teammate, the teammate is willing

to take part of member A’s task and member A will utilize her/his specific strength for other tasks support to her/his teammate

Employee A is assigned to build a part of new production progress, to a certain stage, employee A

is not qualified, employee B will support employee A to do the rest of the progress And it will be the same situation for employee C to support employee B when employee B in the difficult stage

of progress Because of the transfer of work, KPI assessments will be bias and affected the overall assessment decision for employees at the end of the year According to Moradi, Mehraban & Moeini34 and Harrington & Lee19; Kampkotter24 the effective performance appraisal will improve the quality of the employee performance and because of the ineffective performance appraisal; it will lead to the consequence of the low performance of the team

As Cawley, Keeping & Levy7; Roberts46; Singh53 mentioned, “There are very few studies and literatures on employee participation focus on performance appraisal”

In addition, Daoanis12,13 with a clear vision, constructive feedback in the appraisal process is expected to provide for employees to participate in performance appraisal

And from Mr Nguyen Minh Thang – team member, said that:

“Well, I think that currently SMI are lacking of KPI to manager the performance of Production team and I am not satisfy with my performance appraisal

And when we are completed the assignment, we evaluate the effect of the teammate’ input

is higher than member’s input for both direct and indirect in-charged person

Even the member is support for other task to fulfil the assignment”

And from Ms Nguyen Ngoc Bich – Developer who work for nearly 02 year said that:

“Our production team is a special team and use the invested fund of SMI to maintain our operation and due to no product invested, lack of KPI to manage the performance so we have no bonus for years”

By Ikramullah, Shah, Khan, Hassan & Zaman23 the performance assessment allows both the company and workers to define, evaluate and establish an individual performance benchmark In addition, with Armstrong-Stassen & Schlosser2 it acknowledges the position of the individual employee and makes each employee more committed to the company or encouraging poor performers to improve

According to the Table 5 below, because of the ineffective performance appraisal so the performance ratio of developers of the team in the past 3 years has decreased from the outstanding and highly effective performance to effective performance and under expectation performance nearly 50% for the past 3 years

Table 5: Performance appraisal from 2016 – 2019

Expectation

Effective Performance

Highly Effective Performance

(Source: SMI Performance appraisal ratio from 2016 - 2019)

This performance appraisal is the evaluation based on the results of the revenue of new technology products that they have built before and based on the testing product report of Table 3

From the information obtained, it can be seen that the ineffective performance appraisal greatly affects the performance of the Production team

From Trong’s opinion: Developer who has low performance result:

“Few years recently we have no launched product to the market, most of the product did not meet the customer demand and requirement, even we made many product but the competitor in this industry was increased rapidly so we are facing to low sale revenue, low salary increasing and led to low performance and have no bonus “

And Nam Vũ a Leader also said that:

“Some members are really intelligent but they are quite ridiculous They feel demotivated

by redoing the task since the tasks have not done properly Some refuse to rework and the others need to support them The rework will make low team performance and low motivation”

By stated at Roberts46, the ineffective performance will be a consequence of less or participation of employee, since they may see it valueless as stated by Wright57

non-With Maley33 while conducting performance evaluation with no well-defined goals may have serious effects, such as discontent among workers, resulting in a decrease in productivity and organizational engagement By Daoanis12,13 the appraisal framework is supposed to have a clear sense of direction and positive input in the process in order to provide an incentive for workers to engage in performance standards and set targets

4 LACK OF LEADERSHIP

Due to the young generation company, so the leader is lack of leadership skills by shown as the survey for the ratio of 25% A number is also quite high and needs to be considered Lack of leadership skill will make negative impact to employee performance Lack of training and coaching from the leader may also be due to many negative personalities of leader Many researcher call such personalities or ineffective leadership is” toxic” leadership by mentioned in Frost18; Padilla et al.40 or abusive leadership in Tepper54; or destructive leadership in Kellerman25; Schaubroeck et al.,48; Mumford et al.,35

From Internship member – Mr Nguyen Duc Tuan, he said that:

“As we are in internship program so we don’t have much chance to work directly with our leader so less direct communication and we could not give feedback to our leader or receive the coaching from them”

“We are young and often want to express our voice, opinions and thoughts; sometimes they are not flexible in solving problems and refusing to follow to our suggestion because they may think we are non-experience”

From Shenhar et al.,52 “Leadership is an indispensable part of project management, impacting directly on project outcomes” By Kerzner26 “leadership have also been identified as a critical success factor, determining either the success or failure of a project by

These consequences of toxic leadership may have negative affect to organization with high turnover rate, low revenue for stakeholder, unstable team member, and even for themselves as stated in House and Howell22; Conger10; O’Connor et al.,39; Zaccaro et al.,58; Kellerman25

From Lombardo et all31: lack of leadership will lead to the following negative result:

 Inability to build a strong team

 Lack of team management

 Low job performance

 Not supportive and demanding of subordinates

 Being overly emotional

 Being insensitive and arrogant

 Having poor relationship with team member

 Overriding personality defects

And from Mr Nguyen Ngoc Tuan – Developer who has low performance result:

“Some staff are not happy with their performance appraisal And they have no bonus so this is also one of the reason for their demotivate themselves SMI production team is a special department so we are currently lack of performance management from the leader”

Annually evaluating performance is not enough for young employees They need the constant feedback for their responsibility at work They also need the leader to assess their contribution when they have made any progress in the process of develop new product

Traditionally, software quality is to depend on variety reason by Leadership, Training, and Experience and especially is teamwork relationship among the developer It has been shown to depend “on good teamwork, specifically with respect to the interaction processes within a team”

by Hoegl & Gemuenden21; Liang, Wu, Jiang & Klein29; Henderson & Lee20 The lack of leadership skills also leads to an incorrect assessment of the team's team performance will be the cause of ineffective performance appraisal

From the above primary and secondary data, the interview, the survey among the team member, it

is shown that the current problem of SMI is low performance of the production team So the cause – effect map will be shown as below:

5 CAUSE – EFFECT MAP

IV CAUSE VALIDATION

Based on the cause and effect tree, in-depth interview from 12 respondents divided into 4 main groups, secondary data from SMI, sales and marketing department and theories informed, causes leading to low performance results of Production team is ineffective performance appraisal It is important for SMI to explore which factors are actually main causes leading to low performance

of production team

Firstly, lack of leadership , the leader always busy and manage from distance, this is one of the cause since when the team lack of leadership skill to train and provide unclear KPI to them, they will have low performance They are young and lack of training so it is quite difficult for them to train the others especially for team member with same ages It is also a reason that led to low performance of the team Ineffective leadership is also a negative trait of the leader are being always right as mentioned by Dotlich and Cairo14 As stated from Paton41 “There are four kind of good, successful leadership and failed one”

 First is the category of innovative specialist leaders

 Second is the category of qualified leaders

 Third is the category of normal leaders

 Fourth is the category of ineffective leaders They are the leaders who even when they are put in charge of initially successful and viable firms degrade the once healthy companies such that they end up facing the threat of bankruptcy and liquidation

As confirmed by the Director of Production team: Lack of leadership was not a major cause because even lack of leadership skills from the leader, the team also have the training from the higher position as Manager The Manager will take responsibilities for the training to the team And in the future, the company will focus to build up the leadership management for leader This also impact to the performance of the team

Lack of leadership also lead to low teamwork spirit Low teamwork spirit will cause the high turnover rate of production team base on the employee status data from 2016 to 2019 Low performance affects customer satisfaction and satisfaction decides sales revenue They also stated that when salesperson performed poorly, sales managers would increase pressure with negative

As by Faraj and Sproull15 “Teamwork is obviously important in software development In traditional development, the study showed a strong relationship between management of expertise and team performance

Furthermore, from in-deep interview with Vu Tien Nhat – a member a production team said that:

“Young employees have the talent but partly due to the characteristics of the IT work, so they are less communicate and tend to communicate through technology tools or apps so this also leads to poor communication that will also affect the quality of products”

As by Faraj and Sproull15 “Teamwork is obviously important in software development In traditional development, the study showed a strong relationship between management of expertise and team performance”

Since all team members are working in the IT industry so there are a lot of way to make them keep

in touch They can communicate though apps, tool like: skype, zalo, whatsApp to communicate Mostly they prefer to communicate by digital communication better than interaction with each others That’s why the members of production team voted for low team work spirit because they feel disconnect to team member as they only contacted each other by technology tools

This is also not a major problem since typically, the employees who work for technology industry are quite simple even they are less communicate to each other, but they can test and have an online meeting to catch up the work results So low team work spirit is not a major cause for the low performance of production team

Secondly, At SMI, once a new technology product failed to adapt the market and received unexpected result from the clients, it would be considered as failure product This was the nature

of the IT industry due to the fierce competition, and because of these reasons, so there were only few new technology products of SMI had big impact to the market Once a new technology product

is considered a potential for development, it would be invested a lot of time and effort by the management If not, that new technology product will be define as failure product

The failure of a technology product depends on many factors such as the convenience, the availability or the advantages and the majority of competitive technology products at the market today have the same functions, feature so it did not make any attraction to the investors for funding

or selling to client

Therefore, from the perspective of Mr Nguyen Tuan Khai - Sale/Marketing Manager:

“The quality of products is unstable; I received many complaints from customer for that issue I lost many customers for that reason It reduced my sales revenue

And “failure product” has been impacted a negative result on sales performance of Sale team and the reputation of the company”

And in SMI, that new technology product will be considered a failure product and will consider for continuing to re-test, upgrade function, suspend or stop completely depending on the company's finances and team situation And specially is the as Spynkal, it costed time and effort, budget from

SMI for months but the product did not bring any value or profit for the team and the company as well

The failure product is also the consequence of lack of leadership as from Mr Le Huu Minh – Developer who work for the team over 01 year said that:

“The leader of our team is too busy to follow up to each member, to keep track the team performance” Due to lack of leadership skill so some of our team members have low performance by tracking the client requests is slow and behind schedule”

And as mentioned before, Production team is a Department that have investment support from the SMI company so the failure product is not a major cause to their low performance, because the production members are still receive their monthly salary even they can’t make any successful technology product

Thirdly, as shown in the results of the internal survey from the company, the voting rate for unattractive salary and bonus was 40% voting ration among the other causes According to the market salary of IT industry, the salary of IT staff is quite high and the salary usually includes bonus for working results And when a technology product brings success or calls for investment, some technology companies such as SMI will share the incentive at a certain rate for each member

in proportion from their contributions And from 2017 until now, the production team did not build any successful products so there was no bonus for the team This is also a cross influence from no bonus, no motivation to build a quality product and there is no quality product, there is no bonus

in compliance with the company policy But this is not the main reason affecting the performance

of team production in general because the Management of SMI company is ready to invest or spend their budget to maintain the team as a part of nurturing the talent to build the technology products that can bring huge profits, revenue to attract investment as others previous technology products

Lastly, with Ineffective performance appraisal, the board of director of SMI, consider this is main problem because at the current the team is lack of KPI, lack of KPI to evaluate the performance of production team member This is a main cause lead to the low performance of the team Lack of KPI impact to ineffective performance appraisal and effect to the low performance of production team By the in-deep interview from employee showed their feeling about the performance appraisal of the firm was quite bias and unclear KPI Some leader has biases toward some team members and lead to inconsistencies among different member And when they disagrees with the final results, they will make an argue and may take the situation go further serious and need the