UNIERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ NGUYEN THI THIEN HUONG THE RELATIONSHIP BETWEEN EMOTIONAL INTELLIGENCE AND TURNOVER INTENTION: THE CASE OF HO CHI MINH CITY EMPLOYEES MASTER OF BUSINESS (Honors) Ho Chi Minh City-Year 2016 TIEU LUAN MOI download : skknchat@gmail.com UNIERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ NGUYEN THI THIEN HUONG THE RELATIONSHIP BETWEEN EMOTIONAL INTELLIGENCE AND TURNOVER INTENTION: THE CASE OF HO CHI MINH CITY EMPLOYEES ID: 22130029 MASTER OF BUSINESS (Honors) SUPERVISOR: DINH THAI HOANG Ho Chi Minh City-Year 2016 TIEU LUAN MOI download : skknchat@gmail.com ACKNOWLEDGEMENT First all, I would like to express my sincere gratitude to my supervisor, Dr Dinh Thai Hoang, for his professional guidance, positive encouragements and helpful guidance during the time of doing my research. I would like to express my appreciation to Dr. Nguyen Dong Phong, Dr. Nguyen Dinh Tho, Dr.
Tran Ha Minh Quan and Dr. Nguyen Thi Nguyet Que for their valuable time and advice as the members of the proposal examination committee. Their comments and meaningful suggestions are significantly contributed to this research completion. My sincere thanks are given to all of my teachers at International Business School for their teaching and guidance during my master course.
Finally, my deepest gratitude also goes to my family for their financial support and gentle encouragement so that I have an opportunity to be here - University of Economics of Ho Chi Minh City. TIEU LUAN MOI download : skknchat@gmail.com ABSTRACT The concept of employee turnover intention is becoming a popular topic for managerial effectiveness both in the public organization and private companies. In 21st century, employee retention is considered as a key factor for business survival for all level of management in service industry. However, very few of the scholars have discussed about this matter particularly in the field of sales.
In term of sales management, staff turnover is also incredibly important due to the nature of sales positions, their historically high turnover levels, and the difficulty involved in filling them. In an effort to help sales executive have an overview about the behavior and performance of employees, the present study explores the relationship between emotional intelligence and turnover intention through the impact of emotional intelligence on work-family conflict and emotional exhaustion. A survey had sample size of 201 valid questionnaires that were used for data analysis with CFA and SEM. The findings broaden knowledge on how these variables affect the turnover intention and how to reduce turnover rate more successfully in the world of intense competition.
Keywords: Emotional intelligence, work-family conflict, emotional exhaustion, turnover intention, turnover. TIEU LUAN MOI download : skknchat@gmail.com CONTENTS ACKNOWLEDGEMENT ABSTRACT ABBREVIATION Chapter 1: INTRODUCTION .1 Background to the research and research problem. 6 CHAPTER 2 LIETERATURE REVIEW AND HYPOTHESES .3 Work-family conflict.5 Relationship among variables .2 The quantitative study .1 Sampling and data collection .2 Data analysis procedure. 24 Chapter 4: DATA ANALYSIS .1 CFA for the first-order constructs .2 CFA for second-order constructs .3 CFA for the final measurement model.
34 TIEU LUAN MOI download : skknchat@gmail.3 Structural equation modeling (SEM). 42 Chapter 5: CONCLUSIONS, IMPLICATIONS AND LIMITATION .1 Conclusions and implications .2 Limitations and recommendations for Future Research. 60 TIEU LUAN MOI download : skknchat@gmail.com LIST OF FIGURES Figure 2.1 CFA model of Work-Family Conflict .2 CFA model of emotional exhaustion .3 CFA model of turnover intention .4 CFA model of Emotional Intelligence.5 Final measurement model. 40 LIST OF TABLES Table 3.1 Source of data collection.2 The first run of CFA (of work-family conflict, emotional exhaustion and turnover intention) .3 Summarized of CR, AVE and Cronbach’α (first order constructs) .4 Summarized of CR, AVE andCronbach’α (emotional intelligence).6 Summarized of CR, AVE and Cronbach’α (final model) .7 CFA Summary of eliminated item .9 Chi-square difference test for the constrained and unconstrained models (other-emotions appraisal and use of emotions) .10 Unstandardized structural paths.
41 LIST OF APPENDIX Appendix A List of in-depth interviews’ participants. 60 Appendix B Qualitative in-depth interview. 60 Appendix C Qualitative in-depth interview findings. 70 Appendix F Correlations among components of emotional intelligence, work-family conflict, emotional exhaustion and turnover intention.
73 TIEU LUAN MOI download : skknchat@gmail.com ABBREVIATION AVE Averaged variance extracted CFA Confirmatory Factor Analysis COR Conservation of resource theory CR Composite reliability EAPs Employee Assistance Programs EFA Exploratory Factor Analysis GDP Gross Domestic Product GSO General Statistics Office of Vietnam ILO International Labor Organization SEM Structural equation modeling SPSS Statistical Package for the Social Sciences TIEU LUAN MOI download : skknchat@gmail.com Chapter 1: INTRODUCTION 1.1 Background to the research and research problem In the recent decades, the concept of employee turnover intention has been further becoming a popular term in various studies on different managerial disciplines; thus, prompting more executives/managers in many different business fields (e. sales in service industry) to apply this concept for their employee management (Tett & Meyer, 1993; Lee & Chon, 2000). Lee and Chon (2000) identify job turnover intention as key considered management term for successful careers and business survival at all level in service industry for 21st century. Therefore, organizations in the service industry should give a try to improve their people work- life and take advantages of these emotional balance to create beneficial outcomes.
The special feature of a service industry is “the contact and interaction between service providers (employees) and service acceptors (customers)” (Tsaur, Chang, & Wu, 2003, p. The main products provided by service organizations are services and the employees who play role as service providers will provide those services to customers. Thus, employee in service industry becomes a part of service products and the work-life balance will enhance their suitable emotions in responding customers’ expectations help to form image of organizations (Kusluvan, 2003). The issue, then, is how service employees manage their emotions effectively and lessen job turnover intention.
Most successful service organizations understand their people’s feelings and always have the special cares about any issues that may hurt the employees. Thus, the traditional management provided by hierarchical structure might not be a truthful way to understand subordinates while the tones of workloads and stresses are killing human emotions even with the workaholic (Cropanzano, Rupp & Byrne, 2003). It is critical for an organizations to build a working environment of trust, understanding and encouraging (Taylor, 2001). 1 TIEU LUAN MOI download : skknchat@gmail.com In the trend of transitioning and developing Vietnam’s economy, service sector is identified as one of the largest sectors in the economy and one of the biggest contributors to the overall growth rate.
According to the general statistics office of Vietnam, the growth rate of the service industry is 6.56%/year and the economic structure has been adjusted to the better direction that the services sector continued to contribute the largest portion to the GDP increasing from 41. Furthermore, it is said that Service sector plays a significant role in the economic development of Ho Chi Minh City with the fastest rate of growth among industry and agriculture sectors during 2011-2013 (GSO, as cited in Tap Chi Cong San, 2013). As a result, service domain should provide excellent customer service that comes from a quality workforce. However, International Labor Organization (2015) stated that Viet Nam’s labor productivity level is the lowest among ASEAN countries due to low-skill labor forces and high job turn-over intention.
This organization also assumes that recent productivity growth rates are maintained, “Viet Nam will reach the Philippines only by 2038, Thailand by 2069 and take far more time to catch up with many other countries” (ILO, 2015, p. It is also said that Viet Nam's service workforce lacks experience, skills and professionalism for providing good quality services (Tran, as cited in Xuan Huong, 2013). Aslam, Shumaila, Azhar and Sadaqat (2011) realized that these service fields are experiencing labor shortage problems caused by high job turnover and poor employee performance. Therefore, the service industry are strongly required to improve its human resource management in providing services.
Currently, Vietnamese government efforts are trying to renovate service industry in Vietnam. The workforce in this industry has been training to gain more experience, skills and professionalism for providing good quality services (Nguyen Van Tuan, as cited in Thanh Tam, 2014). However, the challenge is that Vietnam service organizations are characterized by 2 TIEU LUAN MOI download : skknchat@gmail.com hierarchical and autocratic styles which create a barrier preventing high management level to understand the reason of high employee’s turnover intention. Numerous researchers have emphasized the significant role of avoiding job turnover in organizations to remain competitive in the rapidly expanding market and business survival (Knudsen, Ducharme & Roman, 2008; Saeed, Waseem, Sikander, & Rizwan, 2014).
Additionally, turnover intention is a painful issue in human resources management which cause negative influence to the organizations including cost of selection, recruitment, training, etc. (Lee & Chon, 2000; Saeed et al. With the increasing interest in employee turnover intention, numerous studies have been conducted in predictors of job turnover intention and they discovered several factors including employee stress, job satisfaction and work-life balance. Among those, emotional intelligence is also one of the key factor which affecting turnover intention (Avey, Luthans & Jensen, 2009).
Prior studies have confirmed that emotional intelligence strongly affects people intention to leave their jobs in different managerial level by causing lack of trust, work–family conflict, and work stress (O'Boyle, Humphrey, Pollack, Hawver & Story, 2011). Additionally, things change and people change. People’s emotion changes quickly basing on the challenges in the workplaces. Therefore, the management of employee emotional change is an issue for both employees and organization in service industry.
Gabčanová (2011) stated that human resource is the most important asset of every organization. It is neither that technology nor structure made the organization development but people. The organization is evaluated as highest performance companies if they have high human development index (Khan, Nazir, Kazmi, Khalid, Kiyani & Shahzad, 2014). Therefore, retaining talented and knowledgeable employees become a major concern for many organizations.
And reducing employee turnover is one of real solutions for this issue (Aslam et al. As 3 TIEU LUAN MOI download : skknchat@gmail.com employee turnover not only causes considerable financial costs to organizations but loses their talents. Because of its powerful impact on both organization aspect and employee positive emotion, many researches encourage to enhance managers’ acknowledgement about the connection between emotional intelligence and turnover intention in order to retain its critical workforce. Up to now, numerous studies have been conducted about the perceptions of subordinates in term of emotional intelligence, work-family conflict, emotional exhaustion, and employee turnover intention and their significant mutual relationships in developed countries (O'Boyle et al., 2011; Bande, Fernández-Ferrín, Varela & Jaramillo, 2015).
Very few scholars do the research about this issue in Vietnam where the term of emotional intelligence and turnover intention are not truly considered in management. These studies, however, focus on other contexts of turnover intention and these studies do not measure the relationships of these concepts in one model (Tuan, 2013; Ninh, 2014). As indicated, however this issue has not yet resolved. Thus, basing on this gap, this study aims for examining the mutual impact of emotional intelligence on work-family conflict and emotional exhaustion, and subsequently exploring its effect on turnover intention of sales employees in the service industry in Vietnam.2 Research objectives The overall objective of this study is to examine the role of emotional intelligence in work-family conflict and emotional exhaustion, and subsequently in turnover intention of salespeople who are working in the service industry in Ho Chi Minh City, Vietnam.
Specifically, it investigates: 4 TIEU LUAN MOI download : skknchat@gmail.com The relationship between emotional intelligence and emotional exhaustion; The relationship between emotional intelligence and work-family conflict; The relationship between work-family conflict and emotional exhaustion; The relationship between emotional exhaustion and turnover intention; The relationship between work-family conflict and turnover intention.3 Methodology In this research, two phases of study were undertaken: a qualitative study and a quantitative study.