1 SOLUTIONS TO IMPROVE INEFFECTIVE SUPERVISION AT FPT DIGITAL RETAIL JOINT STOCK COMPANY TRUONG THUY QUANG MBA THESIS INSTRUCTOR: Dr. Nguyen Thi Nguyet Que Feb 6, 2017 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 2 Table of Contents Acknowledgement. 5 CHAPTER I PROBLEM IDENTIFICATION .2 Market share and competitors .3 Company history and structure .Background of problem .1 Potential central problem.2 Justify the existence of problem .3Jusify the importance of problem .4 Identification of potential causes:. 23 CHAPTER II ALTERNATIVE SOLUTIONS.
30 CHAPTER III SELECTED SOLUTION AND CHANGE PLAN .Introduction to selected solution.Change plan and counter measures:. 41 CHAPTER IV SUPPORTING INFORMATION .Questionnaire development to justify central problem .2 Questionnaire development to justify causes .3 Transcript of all interviews. 77 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 3 List of Tables Table 1: Asia retails sales volume growth from Economist Intelligence Unit, 2016 .7 Table 2: Electrical appliances and housewares: Market demand growth from Economist Intelligence Unit, 2016. 8 List of Figures Figure 1: FPT Corporation structure from FPT Retail Human Resources, 2016.
10 Figure 2: Staff growth at FPT Retail JSC from FPT Retail JSC Human Resources, 2016. 11 Figure 3: Turnover rate at FPT retail JSC from FPT Retail JSC Human Resources, 2014 to 2016. 11 Figure 4: Initial cause and effect map. 16 Figure 5: Final cause and effect map.
26 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 4 Acknowledgement I would like to express my deepest appreciation to my supervisor, Dr. Nguyen Thi Nguyet Que, who always stands by me and motivates me to complete this. Without her full support, this master thesis cannot be fulfilled. Needless to say, her guidance helped me in all the time of writing this thesis.
In addition to that, I want to show my sincere gratitude to Prof. Nguyen Dinh Tho, who are always dedicated and patient to us in every single moment. Besides my advisors, I would like to thank my family and friends for encouraging me spiritually throughout writing this thesis. LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 5 Executive summary This thesis of “Solutions to improve ineffective supervision” had been composed and completed in four main chapters: problem identification, alternative solutions, selected solution and change plan, supporting information.
Chapter I included company introduction which is FPT Digital Retail JSC, main features about FPT as well as some recent issues that illustrated from a wide variety of secondary data. To make it clearer and convincing, in depth interviews were conducted to explore problems further to see what was really going on in this company. A problem mess had been created to show out all symptoms, organization outcomes and problems as a general picture. Specifically, a central problem of ineffective supervision was selected to be solved as a core problem of company with the justification of its existence and importance.
After validating and selecting the central problem of organization, three causes of central problem listed as supervisory relationship, soft-skill training, gender-related leadership were investigated to verify and determine so as to give out alternative solutions which were presented in chapter II. In this thesis, there were two solutions proposed for short-term and long-term to tackle problem with evaluation and comparison between these two solutions to best out the most relevant and suitable for organization which were discussed in chapter III. The last chapter was named as the supporting chapter to support all information and information source for the above three chapters. It composed three sections of LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 6 questionnaire development to justify central problem, questionnaire development to justify causes and transcript of all interviews.
In-depth interviews were widely used at different levels from staff to manager to collect data and to diagnose various aspects of the problem with the methodology of design-oriented and theory-informed from a wide variety of fields such as retails, service industry, management etc. After collecting data and information to analyze, it was believed that employee satisfaction had been greatly affected by lots of factors such as nature of work, pay and benefit, motivation etc. However, this research illustrated that factor of supervision had been mostly influenced which led to the very alarming consequences such as high turnover, low job performance and employee satisfaction. LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 7 CHAPTER I: PROBLEM IDENTIFICATION 1.1 Industry overview In this constantly changing world, Vietnam is one of the most actively emerging markets.
Particularly, despite the world economic slowdown, retail sector of Vietnam is highly considered as high level of attractiveness. As being illustrated in Table 1, over the past 4 year, Vietnam had a pretty low growth rate in comparison with other developing countries such as China, Hong Kong. However, recently from 2016, it is predicted that the second-highest growing country belongs to Vietnam though these figures varied slightly. Table 1: Asia retails sales volume growth from Economist Intelligence Unit, 2016 Needless to say, retail competition of electric device market is getting gradually aggressive and expansive.
Follow the very similar pattern with the growth rate in the first LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 8 table, this second table illustrates the rapidly growth of Vietnam in term of electrical appliances and housewares. Since 2014, Vietnam won the second-highest place in market demand growth just after China as presented in table 2 below: Table 2: Electrical appliances and housewares: Market demand growth from Economist Intelligence Unit, 2016 1.2 Market share and competitors Several biggest mobile phone retailer listed must be Thegioididong Joint Stock Company, FPT Digital Retail Joint Stock Company, Vienthong A etc. During the past 5 years from 2010 to 2014, Thegioididong drives the position of one of 500 leading retail companies in Asia Pacific area and won the first place of mobile retail business (according to doanhnhansaigon. “The Vietnam mobile phone retail market is heating up with an enormous expansion of the largest retailers such as Thegioididong, FPT and VienthongA.
Therefore, smaller retailers in the mobile phone business need to adapt in order to survive in this competitive market. LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 9 Vietnam’s largest mobile phone retailer, Thegioididong has accounted for 40% share of mobile retail market in Vietnam and its revenue in 2015 was reported to increase 60% compared to the previous year from 15,800 billion VND to 25,250 billion VND. “The market share of Thegioididong is up to 40% and not stoppable; It is really not easy for anyone who wants to penetrate into this market to compete with Thegioididong” Nguyen Duc Tai, the CEO of Thegioididong, said.” The strongest rival of FPT Shop must be Thegioigidong, the first comer in this playground with more than 688 stores, 16.969 employees in all regions of Vietnam. It accounts for 30% market share followed by FPT Shop 10%, Vienthong A Viettel 20% and the remaining belongs to small and medium sized shops.
Nevertheless, due to this strong competition, it is confronting with one another giant competitor named FPT Shop whose number of shops sharply rocket in all around Vietnam. To reach out this target, retail staff has made great contribution though this company is under threat of high turnover rate which is the result of low job satisfaction, working time, competition between staff etc.3 Company history and structure On August 28, 2007 FPT Digital Retail JSC was established with the store chain named [IN]Store nationwide. After that, in 2008, [IN]Store changed its name to FPT Shop. And since 2009, FPT brand name has become popular with customers.
Three years later, FPT Retail JSC changed its name to FPR Digital Retail JSC and this name has been widely used until now. LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 10 Regarding the structure, FPT Digital Retail JSC (FPT Retail) operates under FPT Corporation as one of its subsidiary. People in Vietnam witness this familiar name FPT Shop. Until now, there are approximately 300 stores in around Vietnam mainly in Ho Chi Minh City, Ha Noi, Hai Phong, Can Tho, Da Nang and Hue.
Predictably, Year 2016 witness a sharp increase up to 400 shops. FPT CORPORATION FE FIS FOC FRT FTEL FTG FS Figure 1: FPT Corporation structure from FPT Retail Human Resources, 2016 FPT Shop provides huge ranges of products from Mobile phone, Laptop, Accessories to Service, used mobile phones. For staff, there is a dramatically increase in staff growth with career path from newbies to Regional Shop manager. In 2015, the number of staff reached 4500 people and increase to around 5000 staff in 2016.
Staff growth 5000 4000 3000 2000 1000 0 2007 2010 2012 2013 2014 2015 2016 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 11 Figure 2: Staff growth at FPT Retail JSC from FPT Retail JSC Human Resources, 2016 Even the significant development in staff growth and turnover go up very noticeably, symptoms of high turnover rate and products return, customer complaints are “real and urgent threat” to the sustainable long-lasting development FPT retail.2 Background of problem There is no doubt that retail industry has witnessed a high turnover rate from some sources of secondary data. According to a survey in 2016 of Mercer and Talentnet(1), big companies in Human Resources consulting, the top three industries with a high turnover rate were retail (39%), life science (17%) and technology (16.2%) and staff turnover rate in 2015 was slightly lower than 2014. In particular, FPT retail JSC held a high turnover rate from 2014 to 2016 as being seen in figure 3 follow: Turnover rate 70.0% 2014 2015 First 6 months 2016 Figure 3: Turnover rate at FPT retail JSC from FPT Retail JSC Human Resources, 2014 to 2016 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 12 From the external sources of information as secondary data, In the Corporation, FPT Retail is still the growth-leading company in profit before tax and revenue (2) .FPT Retail is now calling for big investors to invest into this area of retail. With the rapid expansion of shops in 63/63 cities and provinces, this company put a very high pressure on their staff especially for sales group to be more competitive and stronger.
To explore this problem further, interview has been conducted with 8 people who are from 3 groups mentioned below: The first group of 3 people including those who are currently working at FPT Retail JSC: Ms. Le Thi Ngoc Hoa – currently a staff in HR department of FPT Retail ; Mr. Huynh Quang Long – Head of Training Department of FPT Retail ; Ms. Le Thi Bich Ngoc – Shop Manager of 344 Le Van Khuong, Dist 12, HCMC.
The second group has 03 participants who used to work at FPT and then left for another organization : Mr. Vu Thanh Tung , he is currently working as Shop Manager in Vinpro+ and used to work at FPT Retail for more than 4 years with various positions; Ms. Nguyen Ngoc Thanh Hieu 24 years old, she used to be a salesman at FPT Shop and now working for Hoa Thien Phu Company; Mr. Ly Quoc Tien who used to work at FPT at 3 different positions : salesman, technical staff, taskforce member.
The last group of 2 customers: Mr. Ho Nhut Khuong – 25 years old, a regular customer of FPT Shop; Mr. Le Dinh Qui (33 years old), rarely buy product at FPT Shop. LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 13 Conducting these initial interviews with all group members listed above; there are different features for each group.
The key reason for choosing these people to interview is that, various perceptions and perspectives have been marked and collected. With the first group, they are all currently working at FPT Retail JSC but different department and level from staff to shop manager and training manager.