ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH --------------------- LÊ NGỌC MINH THU THE INFLUENCES OF REWARD MANAGEMENT ON THE PERFORMANCE OF EMPLOYEES WITHIN VIETNAM BANKING SECTOR – A CASE OF THE JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT OF VIETNAM (BIDV) NGHIÊN CỨU SÂU VỀ ẢNH HƯỞNG CỦA QUẢN TRỊ THI ĐUA KHEN THƯỞNG THÚC ĐẨY NĂNG SUẤT LAO ĐỘNG CỦA CÁN BỘ TẠI NGÂN HÀNG TMCP ĐẦU TƯ VÀ PHÁT TRIỂN VIỆT NAM LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH Hà Nội - 2017 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH --------------------- LÊ NGỌC MINH THU THE INFLUENCES OF REWARD MANAGEMENT ON THE PERFORMANCE OF EMPLOYEES WITHIN VIETNAM BANKING SECTOR – A CASE OF THE JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT OF VIETNAM (BIDV) NGHIÊN CỨU SÂU VỀ ẢNH HƯỞNG CỦA QUẢN TRỊ THI ĐUA KHEN THƯỞNG THÚC ĐẨY NĂNG SUẤT LAO ĐỘNG CỦA CÁN BỘ TẠI NGÂN HÀNG TMCP ĐẦU TƯ VÀ PHÁT TRIỂN VIỆT NAM Chuyên ngành: Quản trị kinh doanh Mã số: 60 34 01 02 LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH NGƯỜI HƯỚNG DẪN KHOA HỌC: PGS. NGUYỄN NGỌC THẮNG Hà Nội - 2017 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Declaration The author confirms that the research outcome in the thesis is the result of author‟s independent work during study and research period and it is not yet published in other‟s research and article. The other‟s research result and documentation (extraction, table, figure, formula, and other document) used in the thesis are cited properly and the permission (if required) is given. The author is responsible in front of the Thesis Assessment Committee, Hanoi School of Business and Management, and the laws for above-mentioned declaration.
Date: 22th August, 2017. i LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Abstract Reward practice is regarded as one of the most important HR tools in motivating and retaining employees, especially in the banking. Such area is growing at a notable pace, hence, increasing the critical need of having an effective reward system to combat against labour scarcity as well as pursuing high performance culture. This research has critically examined a wide range of academic sources including books, articles, models… related to the stated issue.
The researcher has attempted to assess the complexity in accepted components of a reward system consisting of both extrinsic and intrinsic elements. Moreover, he also employed several content/needs theories with the aim of critically explain why different people are motivated to work by very different rewards. Looking the problem from another angle, the study of literature also touches the part of defining and measuring employee performance which is the stepping stone for any reward system. Based on the secondary research‟s findings, the author can partly prove the positive correlation between desired reward system and high employee performance.
Last but not least, the author strongly believes that the primary research, once been done, can comprehensively test the effectiveness of reward system in motivating and generating good performance. ii LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Acknowledgement Firstly, I would like to make the most of this opportunity to thank my family who has given me a lucky chance to study in HSB. In addition, they have also reassured me all the time through their knowledge and experiences in order to accomplish this project. Secondly, I would like to thank Mr.
Nguyen The Hiep, Human resource manager in BIDV- Hai Ba Trung branch, who gave me ideas for this topic, so I can gain all general information for this research project. Thirdly, I would like to show my sincere gratitude to Assos. Nguyen Ngoc Thang for his enthusiastic support throughout the process of composing this project. Without his valuable advices, I would not able to accomplish the project with a clear orientation.
Lastly, big thanks to all my colleagues at work, all my friends in HSB, especially all HSB - MBA10, who supported me with laughter and joy, and comforted me when I was depressed. Owing to the fact that limited time and ability so it cannot avoid some mistakes in my research topic. I look forward to receiving comments from lecturers and colleagues in order have more accomplished and better achieved of research result. Thank you again for those who supported me, and best wishes to all.
Date: 22th August, 2017 Le Ngoc Minh Thu iii LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Tables of Contents Declaration. iii List of figures. vii List of Tables. viii Chapter 1: General Introduction.
Background Information and Rationale. Aims of research. Objects of research. Scope of research.
Time/Period scope. 4 Chapter 2: Theoretical background about reward management impact to employees' performance. Statement of the issues. The concept of employee reward system.
Maslow‟s hierarchy of needs. Herzberg‟s two-factor theory. Job characteristics model. 12 iv LUAN VAN CHAT LUONG download : add luanvanchat@agmail.
The nature of performance management. The aims of performance management system. Measuring employees‟ performance. Sampling and Data collection.
Selection of respondents. In - depth Interviews. 26 Chapter 4: Assessing the situation of reward management on employees' performance at The Joint stock commercial bank of investment and development of Vietnam (BIDV). BIDV - Organizational background influences to rewards management on employees' performance.
BIDV - The foundation and development. BIDV - Organizational and managerial structure. Overview of BIDV business operation. BIDV – Evaluation of Human resources strategies.
The situation of reward management impacts on employee' performance at BIDV. For the Questionnaires. The complication rising within the interview. 46 v LUAN VAN CHAT LUONG download : add luanvanchat@agmail.
To evaluate the impact of rewards on employees‟ performances at BIDV. To determine the most important rewards that motivates employees at BIDV. To offer recommendations on how reward system of BIDV can be improved in order to improve employee performance .To assess the purposes and directions in delivering reward system at BIDV. To analyse the employee‟s perception toward total reward system.
To measure the effectiveness of the reward system on employees. 51 Chapter 5: Conclusion and Recommendation. 64 vi LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com List of figures Figure 1: The reward system. 7 Figure 2: Components of total reward system.
8 Figure 3: Maslow‟s hierarchy of needs. 9 Figure 4: The Herzberg„s two-factor theory. 11 Figure 5: The Job Characteristics Model. 12 Figure 6: What is performance?.
15 Figure 7: The performance management cycle. 16 Figure 8: The matrix of human resource processes. 17 Figure 9: The conceptual framework. 20 Figure 10: Organizational Chart at BIDV.
30 Figure 11: Managerial Chart of BIDV. 31 Figure 11: BIDV main Products and Services. 32 Figure 13: Key Human resources at BIDV. 35 Figure 14: Age of respondents.
39 vii LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com List of Tables Table 1: Key Performance indicators at BIDV 2012-2016. 33 Table 2: Gender of respondents. 38 Table 3: Level of education. 39 Table 4: Financial Reward systems currently used in BIDV.
40 Table 5: The current level of employees' satisfaction about financial rewards at BIDV. 40 Table 6: Non- financial Reward systems currently used in BIDV. 41 Table 7: The current level of employees' satisfaction about non-financial rewards at BIDV. 42 Table 8: The current level of employees' satisfaction for Commonly increasing salary.
42 Table 9: The current level of employees' satisfaction in Increasing job performance when get a bonus. 43 Table 10: The current level of staffs‟ agree/disagree when they have prompted by their employers. 43 Table 11: The current level of staffs‟ agree/disagree when they have Praise for a job well done from supervisor. 44 Table 12: The current level of staffs‟ agree/disagree when they get formal recognition.
45 Table 13: The current level of staffs‟ agree/disagree when they get in-formal recognition. 45 Table 14: The current level of staffs‟ agree/disagree of the point “overall non – financial rewards encourages the workers”. 46 viii LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Chapter 1: General Introduction 1. Background Information and Rationale Harrison (2003) has mentioned in his book that the human asset of an organisation is its blood which cannot be duplicated or replaced.
Such unique and valuable capital contains “individual capabilities, knowledge, skills, and experience of the company‟s employees and managers” those are needed to be developed, reinforced, and strengthened continuously and consistently (Dess et al. To support the ideas above, General Electric (2000) has stated: Our true “core competency” today is not manufacturing or services, but the global recruiting and nurturing of the world’s best people and the cultivation in them of an insatiable desire to learn, to stretch, and to do things better every day. However, talent employees, as it has been said by Noe, A. (2008) can jump out of the organization at any time to a more “competitive attraction”.
To cope with this talent leaking problem, Dess et al. (2004) and Armstrong (2010) proposed that in order to hold the brightest employees, companies must develop a proper and effective reward system consisting both intrinsic and extrinsic rewards. Consequently, over the last twenty five years, reward management has been a main subject for thousands of research pieces analyzing different systems and its effectiveness on motivating people and obtaining their engagement and commitment, thus, building a high-performance culture (Armstrong, 2006;Torrington et al. However, in the on-growing global banking industry which offers service as main products, the employees and their performance play a key role in building and maintaining customer satisfaction (Williams, R.2006); hence, it is crucial to have more up-to-date research about such systems and its link to employee satisfaction.
Furthermore, whilst most of the recent investigations 1 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com about that subject of HRM were conducted in USA and Europe, almost none of them have been taken in Asia region, especially in Vietnam. In fact, banking industry in Vietnam rapid expansion at the present time. According to Vietnam Banking Industry Report (2015) and Ukessays (2015), "Vietnam has 34 joint stock commercial banks, five commercial banks, 5 joint venture banks and 35 foreign bank branches. Many banks with 100% foreign capital are preparing to enter the Vietnam market".
In contrast with the other commercial enterprise like education, real estate or medical, banking and finance have a progressive and passionate working surroundings. Nevertheless, in comparison with the facing resources and interest physical force, the scarcity of human resource (HR) is a difficulty in the Vietnamese banking sector. This assembles numerous banks regarding an emerging HR war to engage talent people assets. The booming of banking industry in Vietnam requires a lot of skilful employees, therefore, results in severe human resource shortage and urgent talent retention (Talentnet.
Consequently, the author has felt it extremely crucial to have a further research which can deeply analyze employee compensation system used by such Joint stock commercial bank and its affects; so, an effective solution for that matter will be found out and, possibly, adapted to the “new-born” banking industry of other Asian countries. It is also expected that after devoting herself into carrying out this research, the author will gain the deep understanding and knowledge in employee reward management and practice, those are important for her future management career. Aims of research The topic relating to reward management, which is regard as one of the hugest dimentions in HR tool. Therefore, the aim of this paper is only to critically analyze the influence of reward system (which is one characteristics inside the reward management) on employee‟s performance within the Joint Stock Commercial Bank in Vietnam, especially in case of BIDV.