Factors Affecting Employee Job Satisfaction And Job Performance – An Empirical Study In The Fields Of Informatics, Electronics And Telecommunication In Ho Chi Minh City

In addition, factors of working environment, compensation and benefits, team spirit, working condition, relationship with manager, and career development directly affec[r]

Factors Affecting Employee Job Satisfaction And Job Performance – An Empirical Study In The Fields Of Informatics, Electronics And Telecommunication In Ho Chi

Minh City

Mai Ngoc Khuong, International University – VNU-HCMC, Vietnam, info@123doc.org

Pham Thanh Huyen, International University – VNU-HCMC, Vietnam, info@123doc.org

Nguyen Thi Minh Phuong, International University – VNU-HCMC, Vietnam, info@123doc.org

Abstract: The purpose of this study was to identify the main factors which occurred in the

workplace and to measure the direct and indirect effects of them on employee satisfaction and job performance This study applied quantitative approach with online structured questionnaire sent directly to 354 employees working in the fields of Informatics, Electronics and Telecommunicating in Ho Chi Minh City The application of statistical techniques, which includpha1exploratory factor analysis, multiple regression and path analysis, was used to process and analyze the data The empirical results of this study indicated that factors of training, working environment, relationship with manager, career development, and job satisfaction directly affected employee job performance In addition, factors of working environment, compensation and benefits, team spirit, working condition, relationship with manager, and career development directly affected employee job satisfaction and then indirectly affected employee job performance It is suggested that, to increase the quality and the effectiveness of employees’ performance, organizations or companies should achieve high level of employee job satisfaction; enhance relationship between employee’s relationship with managers, provide training, better working environment and condition, compensation and benefit; and give employees opportunities to develop their career.

Key words: Employee job satisfaction; Job performance; Working environment

1 INTRODUCTION

Employee satisfaction is essential to the success of any business Hence, keeping employees satisfied with their careers should be a major priority for every employer Unfortunately, many of them forget the fact that their greatest resource is their employees Nowadays, business environment is characterized by weak economies, rapidly changing technology, organizational reengineering, shortened length of tenure, etc Under these circumstances, managers should concentrate on removing sources of dissatisfaction from the workplace in order to keep employees busy, productive and satisfied A high rate of employee’s contentment is directly related to lower turnover rate There are numerous reasons explain why employees become discouraged with their jobs and then resign They include stress, lack of communication within the company, lack of recognition, or limited opportunity for growth Improving employee performance begins by assisting and helping the employees to grow personally and professionally Creating a well-rounded approach

to managing and coaching the work force requires the expertise of a human resources leader and the support of the company's executive leadership

Job performance of the employees is crucial in maintaining and increasing the effectiveness within a company or organization There were seven important factors pointed out in this research that have great impact on employee satisfaction and employee job performance Moreover, how these factors play their roles in building on employee job satisfaction, in direct and indirect way, was also explained in details In addition, the research proposed some suggestions as practical guidelines to the organizations to improve employee satisfaction and employee job performance in the workplace

2 LITERATURE REVIEW

The definition of job satisfaction varies greatly from authors to authors According to Robbins and Judge (2007), the terminology job satisfaction refers to “a positive feeling about one’s job resulting from an evaluation of its characteristics” This definition is closely similar to Locke’s (1976), the most widely accepted definition, which equates job satisfaction with “a pleasurable or positive emotional state resulting from the appraisal of one’s job or job experience” Both abovementioned definitions have one point in common; that is, job satisfaction comes from one’s appraisal of one’s job, which is affected by internal and external factors Personal standards and personality are classified

as internal factors while working environment, relationship with colleagues and management, etc are considered as external factors Moreover, Robbins and Judge (2007) were of an opinion that job satisfaction is caused by the characteristics of the work itself Hence, job satisfaction is dependent upon many factors and is liable to change

Since the beginning of 21st century, the Total Quality Management (TQM) practices have induced researchers to expand their scope of factors that have significant impact on job satisfaction Top management commitment, employee empowerment, teamwork, job evaluation, and employee compensation influence people’s attitudes towards their jobs The study of Chang et al (2010) suggested that job satisfaction could improve through the inclusion of TQM practices associated with human resources The TQM practices are employee empowerment, employee compensation, teamwork, and management leadership Apart from the trend of using TQM practices, Turkyilmaz et al (2011) proposed a set of factors based on the features of the job The study showed 17 groups which are likely to affect job satisfaction; they are: supervisor management; empowerment-participative management; salary, recognition, reward and promotion; teamwork and cooperation; training program, career development; working condition; communication; family-friendly policy; cooperate culture; compensation; job itself; organization as a whole; emotional exhaustion; performance management; recruitment; demographics; coworker relations

Groups of job and environment related factors are taken into consideration Those factors can be listed as follows relationship with management, team spirit, working environment, working conditions, career development, compensation and benefits, and training

Job performance is the most crucial problem in a company that “made researchers research more and more” It is believed that performance is total expectation of organization from separate behavior samples of each person during specific period of time (Motowidlo, 2003) Job performance is also considered as a set of behavior which person show in relation to his job or, in other words, amount of efficiency gained due to the person job type (training, producing or servicing) (Rashidpoor, 2000) According to Dizgah et al (2012), organizational theorists have divided job performance into two categories: task performance and dispositional performance The former, which “involves parts that expressed in formal job” (Matavidlo, 2003 as cited in Allameh et al., 2011), is defined as tasks and responsibilities of each person and related directly to all things that must be done On the other hand, the latter consisting of those behaviors effect on psychological, sociological and organizational aspects helps organizational and social network to survive (Kwong and Cheung, 2003)

The link between job satisfaction and job performance is one of the most studied relationships (Allison, 2008), and extensively throughout the history of industrial or organizational psychology (Judge et al., 2001) The research has been conducted since at least as early as 1945 (Brody, 1945), and the idea that job satisfaction leads to better performance was supported by Vroom's (1964) work Over the years, scholars that examined this idea have been enlarged However, these reviews have produced several conflicting viewpoints on the satisfaction-performance relationship Siegel and Bowen (1971) and Bagozzi (1980) suggested that job performance leads to job satisfaction but not the reverse Manjunath et al (2008) found job satisfaction of agricultural scientists significantly correlated with their scientific productivity Ravindran (2007 as cited in Davar and RanjuBala, 2012) found that job satisfaction is non-significantly correlated with job performance A common theme among these reviews is a necessity for theoretical work on satisfaction, performance, and their relationship (Locke, 1976; Schwab & Cummings, 1970) Following these reviews, researchers began to more closely consider the satisfaction-performance relationship, both empirically investigating the relationship and also looking specifically at potential mediators and moderators of the relationship (Judge et al., 2001) More modern examinations reasonably clarify the true correlation between satisfaction and performance In other words, how they feel about the work they are doing and the results received from the work directly impact on organizational performance and ultimately on its stability (Milliman et al., 2003)

This study hypothesizes that:

H 1: Factors of relationship with management, team spirit, working environment, working conditions, career development, compensation and benefits, and training positively affects employee job satisfaction

H 2.1: Factors of relationship with management, team spirit, working environment, working conditions, career development, compensation and benefits, and training positively

affects employee job performance

H 3: The effect of relationship with management, team spirit, working environment, working conditions, career development, compensation and benefits, and training on employee job performance is mediated by job satisfaction

3 METHODOLOGY

3.1 Questionnaire design and data collection

Quantitative approach was applied in this research to test given hypotheses The online structured questionnaire design was basing on measured variables derived from the literature reviews for seven independent variables and two dependent variables Most questions were set as statements with five-point Likert scale, ranging from 1 is “strongly disagreed” to 5 is “strongly agreed”

The online structured questionnaires were conveniently delivered to 354 employees who are working in different companies in the fields of Informatics, Electronics and Telecommunication in Ho Chi Minh City There were 354 valid respondents collected in total

3.2 Factor Analysis and Reliability

Two exploratory factory analyses, which used the principal component extraction method and Varimax rotation of 16 items of the group of dependent variables including: job satisfaction and employee job performance and 41 items of the group of independent variables Prior to conducting the factor analysis with the SPSS, the data was screened by examining the descriptive statistics on each item, inter-item correlations, and possible univariate and multivariate assumption violations From this initial assessment, all variables found to be continuous, variable pairs appeared to be bivariate normally distributed, and all cases were independent of one another For this study, the exploratory factor analysis (EFA) procedure was applied twice; once for the group of dependent variables, including two variables and again for the group of six independent variables The Kaiser-Meyer-Olkin measure of sampling adequacy was .925 for the dependent variables and .932 for the independent variables (according to Pallant (2005), to be significant, the value has to be 60 or above), indicating that the present data was suitable for principal components analysis Similarly, Bartlett’s test of sphericity (Bartlett, 1954) was significant (p<.001), indicating sufficient correlation between the variables Using the Kaiser-Guttman’s retention criterion of Eigenvalues greater than 1.0, a two-factor solution provided the clearest extraction for the group of dependent variables, including 15 items (Guttman, 1954; Kaiser, 1974) The two factors of the dependent variables accounted for 53.27% of the total variance and the Cronbach’s coefficients ranged from 824 to 886 among the factors, indicating good subscale reliability

Table 1: Summary of Dependent Variables with Reliability Coefficients

f Items Alpha (N=389) Cronbach’s

Factor1:Employee job satisfaction (EMJOSA) 9 886

Factor2: Employee job performance (EMJOPER) 6 824

In addition, a seven-factor solution conducted for the group of independent variables consisting of 41 items The seven factors accounted for 64.58% of the total variance The seven factors considered appropriate and retained for further analysis The Cronbach’s coefficients ranged from 686 to 887 among the seven factors indicating good subscale reliability

Table 2: Summary of Independent Variables with Reliability Coefficients

of Items

Cronbach’s Alpha (N= 354)

Factor1: Relationship With Managers

Factor6: Compensation and Benefits (COMBEN) 4 725

4 RESEARCH FINDINGS

4.1 Profile of Employees Involved in the Study

In total, there were 354 people in Ho Chi Minh City participated in conducting the survey The quantity of people who work in Informatics field was 237 with 66.9%, which was double the ratio of the field of Electronics and Telecommunication with 117 people and occupied only 33.1%

Next, 241 men involved in the study, which occupied 68.1%, while the number of women was 113 and held 31.9% only, which was less than half the ratio of the men

Regarding to age of participants, the group aged 23-30 made up the majority of the study with 213 people, which occupied 60.2% and only 1 individual under the age of 18 who held only 0.3% of total Besides that, the group aged 18-22 included 83 people, which was equivalent to 23.4%; the group aged 31-45 included 50 people, which was equivalent to 14.1%; and the group aged 46-65 included 7 people, which was equivalent to 2.0%

About education level, people reaching university level occupied the biggest part with 267 individuals who held 75.4% and the smallest group was the group of people at high school level, which had 5 individuals and was equivalent to only 1.4% Besides that, 43 people reached college level and occupied 12.1%; the group of people who were

postgraduate held 7.3% with 26 individuals; the group of people at vocational school level included 13 people an occupied 3.7%

4.2 Correlations between variables

The results of correlation coefficients as showed in Table 3 indicated that there were significant relationships between the dependent variable, EMJOSA, and seven independent variables: REWIMA, TEASPI, WORENVI, WORCON, CARDEV, COMBEN, TRAIN

Table 3: Descriptions and Variables’ Correlations of Employee job performance

EMJOPE

2 TEASPI 440* .647* 1.000

3

WORENVI .560* .550* .554* 1.000

4

.501

*

.576

*

.668

5 CARDEV 443* .606* .547* .461* .531* 1.000

*

.536

*

.458

*

.461

*

.495

*

1.00 0

*

.415

*

.490

*

.464

*

.460

*

.393

*

1.00 0

8 EMJOSA 557* .751* .706* .668* .655* .716* .670* .510*

Std.Deviatio

Note: * Significant level at p < 005

The results of correlation coefficients as showed in Table 3 also indicated that there were significant relationships between the dependent variable, EMJOPER, and the independent

variables: REWIMA (r=.472, p<.005), TEASPI (r=.440, p<.005), WORENVI (r=.560, p<.005), WORCON (r=.471, p<.005), CARDEV (r=.443, p<.005), COMBEN (r=.297, p<.005), TRAIN (r=.428, p<.005) This means that the better were relationship with

managers, team spirit, working environment, working conditions, career development, compensation and benefits, and training, the higher level of job performance of the employees

4.3 Path Diagram of employee job performance

The total effect of independent variables on EMJOPER includes direct effect and indirect effect Those effects are measured by the unstandardized coefficients (B) and were regarded as the path coefficients in the path model The indirect effect index of each independent variable on the dependent variable (EMJOPER) through the moderating

variable (EMJOSA) was the total effect of each independent variable on EMJOSA and the effect of EMJOSA on EMJOPER (Preacher and Hayes, 2008)

Figure 1 Path coefficients of the structural equation for hypothesis testing

Note: All coefficients in the model were significant at the 005 level.

4.4 Factors directly affecting the employee job performance

There were three out of seven independent variables of this study had positive direct effects on employee job performance Those are WORENVI with (B = 269, p<.0005), TRAIN with (B = 103, p<.0005) On the contrary, COMBEN with (B = -.089, p<.0005) had negative direct effect on job performance In addition, employee satisfaction provided the direct effect on employee job performance with B=.272 (p<.0005)

4.5 Indirect effects on employee job performance

The result showed that EMJOSA was directly affected by six factors: REWIMA (B

= 235), COMBEN (B = 209), CARDEV (B = 205), WORENVI (B = 155), TEASPI (B

= 125), and WORCON (B = 092) with p<.0005 These factors directly affected the intervening variable – EMJOSA and then this moderating variable caused an effect on EMJOPER (B =.272) Therefore, through the intervening variable – EMJOSA, the six factors mentioned above created indirect effects on EMJOPER at (.064), (.057), (.056), (.042), (.034), (.025) respectively

4.6 Total Causal Effects of Employee job performance

Employee Satisfaction

Working

Environment

Compensation and

Benefits

Career

Development

Employee job performance

Relationship with

Managers

Working

Conditions

.269

.272

-.145

.103

.155 205 125

.235 209

Training

Team Spirit

.092

According to table 4, the factors that gave the strongest effect on Employee job performance was WORCON with B = .311 Secondly, EMJOSA had the next most significant effect on Job Performance with B = .272 Thirdly, Job Performance was strongly influenced by TRAIN with its B = 103 REWIMA ranked fourth with B = 064, followed by CARDEV with B = 056 The effects on Job Performance that came from TEASPI and WORCON were the lowest with B = 034 and B = 025, respectively On the contrary, COMBEN had the negative impacts on EMJOPER with B= -.088 In sum, the total effect of those seven factors on Employee job performance was 0.777

Table 4: Direct, Indirect, and Total Causal Effects

Direct Indirect Total

5 CONCLUSION

The study successfully endorsed the relationship among factors that affect Job performance, and rated the importance of the effect on Job performance The results indicated that factors of training, working environment, relationship with manager, career development, and job satisfaction directly affected employee job performance In addition, factors of working environment, compensation and benefits, team spirit, working condition, relationship with manager, and career development directly affected employee job satisfaction and then indirectly affected employee job performance

It was expected that Job satisfaction had direct influence on Job performance, and the result did not literally collide with most of the previous researches However, this research did not examine the reverse Thus, the result outcome could not prove whether those two factors had mutual effect or not It was also recommended that the questionnaire should have more open-ended questions or interviews in order to thoroughly explain and describe respondent’s perspectives of the topics

This study provided general information and point of view about what affects job performance based on the data which was collected in the area of Ho Chi Minh City Therefore, managers can consider this study as a source of document, material or information to improve the performance of employees and draw suitable development strategies Regarding to the result of this study, managers are highly recommended to pay

great attention on what strongly and directly affect Job Performance as training, working environment, relationship with managers, employee career development, furthermore, without ignoring the indirect factors as compensation, team spirit, working condition

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