UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Phạm Ngọc Anh Thơ THE MODERATING EFFECT OF EMOTIONAL INTELLIGENCE ON THE RELATIONSHIP BETWEEN JOB SATISFACTION AND AFFECTIVE COMMITMENT: A STUDY AMONG EMPLOYEES IN VIETNAM BANKING INDUSTRY MASTER OF BUSINESS (Honours) Supervisor: Trần Phương Thảo Ho Chi Minh City – Year 2017 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Phạm Ngọc Anh Thơ THE MODERATING EFFECT OF EMOTIONAL INTELLIGENCE ON THE RELATIONSHIP BETWEEN JOB SATISFACTION AND AFFECTIVE COMMITMENT: A STUDY AMONG EMPLOYEES IN VIETNAM BANKING INDUSTRY MASTER OF BUSINESS (Honours) Supervisor: Trần Phương Thảo Ho Chi Minh City – Year 2017 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Acknowledgement I would like to express my deep gratitude to my supervisor Tran Phuong Thao for her precious guidance, valuable suggestions and advice as well as her immense knowledge to support me throughout the process. In addition, I would like to thank my family, my friends and my colleagues for their constant encouragement and immediate helps without which the study would not have been possible. LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Abstract The study investigates the influence of job satisfaction facets on affective commitment in the context of Vietnam banking industry. It also examines the moderating role of emotional intelligence in the relationship between job satisfaction facets and affective commitment.
The model was tested with a sample of 313 employees working for banks in Ho Chi Minh city. The result reveals a good fit between collected data and measurement scales which were introduced and developed in the Western contexts. The findings shows that job satisfaction facets have positive impacts on affective commitment, and that emotional intelligence significantly serves as a moderator for three out of seven facets of job satisfaction and affective commitment relationship. The discovery highlights the importance of documenting job satisfaction and emotional intelligence in enhancing the employee commitment towards organization as well as calls the management attention to their recruiting, training and long term development policies.
LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com TABLE OF CONTENTS ACKNOWLEDGEMENT ABSTRACT TABLE OF CONTENTS 1. Background of the study. Scope of the study. Significance of the study.
Job satisfaction and affective commitment. Emotional intelligence and affective commitment. Emotional intelligence as a moderator. Procedure and sample.
Hierarchical regression analysis. Direction for further studies and limitations. Error! Bookmark not defined.7 LUAN VAN CHAT LUONG download : add luanvanchat@agmail. 37 Appendix 1: Questionnaire survey – English version.
37 Appendix 2: Questionnaire survey – Vietnamese version. 39 Appendix 3: Scale reliability assessment with Cronbach’s alpha (N=313) - Affective commitment scale. 44 Appendix 4: Scale reliability assessment with Cronbach’s alpha (N=313) – Emotional intelligence scale. 44 Appendix 5: Scale reliability assessment with Cronbach’s alpha (N=313) – Job satisfaction scale - Pay.
45 Appendix 6: Scale reliability assessment with Cronbach’s alpha (N=313) – Job satisfaction scale - Promotion. 46 Appendix 7: Scale reliability assessment with Cronbach’s alpha (N=313) – Job satisfaction scale - Supervisors. 46 Appendix 8: Scale reliability assessment with Cronbach’s alpha (N=313) – Job satisfaction scale – Fringe benefits. 47 Appendix 9: Scale reliability assessment with Cronbach’s alpha (N=313) – Job satisfaction scale – Co-workers 47 Appendix 10: Scale reliability assessment with Cronbach’s alpha (N=313) – Job satisfaction scale – Nature of work.
48 Appendix 11: Scale reliability assessment with Cronbach’s alpha (N=313) – Job satisfaction scale - Communication. 49 Appendix 12: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study. 49 Appendix 13: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study. 50 Appendix 14: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study-Job satisfaction facets - Pay.
51 Appendix 15: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study-Job satisfaction facets - Promotion. 51 Appendix 16: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study-Job satisfaction facets - Supervisors. 52 Appendix 17: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study- Job satisfaction facets - Fringe benefits. 52 Appendix 18: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study- Job satisfaction facets – Operating condition.
53 Appendix 19: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study- Job satisfaction facets - Co-workers. 53 Appendix 20: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study- Job satisfaction facets - Nature of work. 54 Appendix 21: Scale reliability assessment with Cronbach’s alpha (N=158) – pilot study - Job satisfaction facets - Communication. 54 Appendix 22: Exploratory factor analysis (EFA) - Affective commitment.
55 Appendix 23: Exploratory factor analysis (EFA) - Emotional intelligence. 56 Appendix 24: Exploratory factor analysis (EFA) – Job satisfaction. 57 Appendix 25: Normal distribution of residuals. 60 Appendix 26: Homoscedasticity test.
61 Appendix 27: Hierarchical regression analysis with emotional intelligence is a moderating value. The conceptual model. Moderating effect of emotional intelligence on the relationship between nature of works and affective commitment……………………………………………………………………………………………….39 Table 1: Demographic statistics. 22 Table 2: Cronbach’s Alpha analysis.
27 Table 4: Hierarchical Regression Analysis with Emotional intelligence as a moderating variable. 30 Table 5: Result Summary…………………………………………………………………………………….39 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com AFFECTIVE COMMITMENT AMONG BANK STAFFS 1 1. Introduction The first part of the study is devoted to emphasizing the practical and theoretical importance of studying affective commitment, job satisfaction, emotional intelligence and the relationships among them. Besides, the study desires to present the interest in the topic in the context of Vietnam banking.
The final section is the summary of objectives which is followed by the scope of the study. Background of the study Human resource has been considered as one of the most valuable asset of any organization. According to Ferrary (2015), human capital has a direct relationship to organizational performance in terms of company’s profit and targets. Other studies found that maintaining a stable labour force is an optimal way to obtain effective cost management and enhance quality of service in a firm (Jago & Deery, 2002) as well as achieve sustainable economic development of a nation (Bousrih, 2013).
The concept of organizational commitment has been studied by many researchers over the last three decades. Diversity of factors were found to have significant relationships with organizational commitment namely: Job satisfaction, job performance, job stress, work attitude, organizational justice, tenure, gender educational level, turnover intention, etc. Affective commitment - the strongest component among three commitments has received considerable attention from researchers all over the word. Being considered as a representative of organizational commitment, affective commitment has demonstrated its significant role in most of the LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com AFFECTIVE COMMITMENT AMONG BANK STAFFS 2 relationships related to employee’s engagement (Carmeli, 2000).
Understanding the associations of these factors with organizational commitment, especially affective commitment, is important for improving the employee performance and enhancing employee productivity as well. In order to expand the knowledge of this issue, numerous of new approaches have been undertaken to contribute to organizational commitment literature. Lately, emotional intelligence has captured the considerable attention from researchers of various fields. It was explored to have a vital role in explaining variety of potential outcomes such as academic achievement, human physical and mental health, social support, overall well- being (Meisler, 2013).
Additionally, emotional intelligence has played its special function as a mediator or a moderator which helps a wide array of studies obtain deeper insights into many relationships. Clarke and Mahadi (2011) observed the linkage between leader- member exchange and a plethora of work-related outcomes, eventually they discovered that emotional intelligence – as a moderating effect, kept an important role in explaining the variation of each specific pair of constructs. Emotional intelligence was also found to have significant influence on the stressor-mental health relation (Davis & Humphrey, 2012), the psychological control-behaviour problem relation (Gugliandolo et.al, 2015)or the stress-burnout relation (Görgens-Ekermans &Brand 2012). Emotional intelligence was proved to have the moderating effect on relationships between affective reactions and specific behaviours (Jorden et al.
Accordingly, previous studies on the job satisfaction – organizational commitment relation have LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com AFFECTIVE COMMITMENT AMONG BANK STAFFS 3 provided crucial contribution to the theoretical foundation but this is not sufficient to explain the variation of employee commitment. Based on the research of Jorden and others, the recent study aims to investigate whether the interaction of emotional intelligence and job satisfaction predicts affective commitment, in other words, whether the association between job satisfaction and affective commitment is stronger for individuals who have high score of emotional intelligence and weaker for ones who possesses a low level of emotional intelligence. Research problem Since joining the WTO (World Trade Organization) in 2007, Vietnam has witnessed a significant economic growth in the latest decade due to the improvement of business environment and the high volume of foreign investments. Along with the achievement in economy, Vietnam banking industry has also seen an outstanding enlargement and development in terms of scale and service quality (Leung, 2009), especially in Hanoi and Ho Chi Minh City.
However, the increases in competition and financial innovation led to an extremely rapid expansion which resulted in banking system problems in the past few years. Eventually, the project 254 called “Restructuring credit institutions system 2011- 2015” was implemented by the Prime Minister in 2012. Accordingly, the State Bank of Vietnam has pushed banks to merge, with the goal of more than halving the number of lenders. In such an unfavourable condition, labour in this sector has experienced a considerable fluctuation with the highest average voluntary turnover rate LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com AFFECTIVE COMMITMENT AMONG BANK STAFFS 4 compared to other service sectors; with the latest figure in 2014 is about 15 % (Thanh, 2015).
Restructuring banking sector not only causes the workforce transition among banks but also between banking and non-banking sectors, accordingly, keeping the intellectual property for organizations is a crucial strategy for maintaining a sustainable development. The literature has showed that a large number of empirical findings on employee’s commitment, emotional intelligence and job satisfaction originated from Western countries, this study attempts to widen the implication to a broader scope outside the traditional samples by testing the relationships among mentioned constructs in the context of Vietnam. The concept of affective commitment was studied in Vietnam services industry (Choi, Tran, & Park, 2015), the finding showed a positive relationship between inclusive leadership and employee work engagement with the mediating roles of affective commitment and employee creativity. Besides, some empirical studies on job satisfaction were conducted in Vietnam in recent years: Job satisfaction was tested among marketers in Ho Chi Minh city by Nguyen and Nguyen (2011), along with job attractiveness, job satisfaction was found to be positively influenced by firm-specific marketing capital pool.
Job satisfaction was also examined in the association with work- family conflict in the context of state-owned and foreign invested enterprises (Nguyen, Jin, Kiong & Fah, 2016). Whilst organizational commitment and job satisfaction have been taken into consideration in Vietnam for several recent years, little is known about Emotional intelligence in this small Southeast Asia country. Over all, gaining a deeper LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com AFFECTIVE COMMITMENT AMONG BANK STAFFS 5 understanding of factors associated with organizational commitment, specifically affective commitment, what directly and indirectly facilitate or hamper the degree of the commitment, will help banks to set appropriate human resources policies to encourage employee’s motivation as well as enhance bank’s performance. Research objectives The study aims to examine the relationship between affective commitment and job satisfaction’s facets with emotional intelligence in the role of a mixed moderator.
Three specified objectives are given as follow: (1) The relationship between job satisfaction’s facets and affective commitment. (2) The relationship between emotional intelligence and affective commitment.