Building the theoretical framework for working motivation of labors in Mutilnational Corporations (MNCs) in Vietnam

Master. PHAM THI HUONG (Quy Nhon University)

ABSTRACT:

 In this article, the author built a theoretical framework for the purpose of discovering the key factors affecting the work motivation of employees in multinational companies in Vietnam. The author used analytical research - synthesized methods to evaluate the valuable findings from previous studies. The theoretical framework proposed by the author is based on the succession of previous studies as Herzberg (1959), but has been adjusted and supplemented to suit the research subjects who are employees in MNCs in Vietnam. Research results show that the theoretical model proposed by the author consists of 8 scales and is measured through all 36 component variables.

Keywords: Motivation, labors, multinational corporations, MNCs.

I. Introduction

In today’s global business environment, multinational corporations (MNCs) face huge challenges in order to successfully survive in the current highly competitive international business market. As a consequence, MNCs should continuously improve their performance in order to remain competitive in their industry for a long period of time. Performance of the firm depends very much on the performance of the employees working at that company. Previous studies have identified many factors that may influence organisational performance and three of them are workplace environment, workplace diversity and employee motivation.

Previous studies proved that motivation of employees may increase if they get their expected reward and recognition that will initially contributes to high performance (Kalimullah et al., 2010). The employees will also put more effort for achieving organizations goal if they are motivated. Motivation actually can give success to organization because it enhances employees to do their work with full concentration and determination. In Viet Nam, there is no study about employee motivation in MNCs. So, in this article, the author built a theoretical framework for the purpose of discovering the key factors affecting the work motivation of employees in multinational companies in Vietnam.

II. Literature review

  • The concept of work motivation

Even though motivation has been studied by scientists for a long time, its definition is still difficult to be defining correctly. This is because philosophical have many different ways to find a nature of human and people can be known by what (Pinder, 1998). Since, many researchers try to define motivation. There are many different definitions of work motivation. According to Kleinginna et al (1981), there are at least 140 different definitions of motivation which had been studied on a various fields of psychology, sociology, business, management, etc.

In this study, the author supports the definition of Herzberg (1959) in “The motivation to work” about work motivation: “work motivation is desire and voluntary effort of the workforce toward achieving organizational objectives”. Motivation is an intrinsic factor and stimulates them to make efforts in allowable work conditions for high productivity and efficiency.

  • Literature review

Motivation is one of the most comprehensively analysed and tested aspects of human life. Between 1950 and now, the phrase “motivation” was used in the titles of over 50,000 texts (Landy, Conte, 2007). In order to recognise the key factors of motivation, it is necessary to understand the ground theories and to critically evaluate and compare the most common findings. It is important to mention that in many companies the concepts discovered decades ago are still operated without any adjustments (Marciano, 2010).

There are many theories about work motivation due to different approaches to motivation. However, it can be said that all the theories come to a general conclusion that increasing motivation for employees will lead to improved labor performance and achieving organizational goals.

            In 1946, the first system of motivational factors published in the Foreman Facts by the Labor Relations Institute of New York with nine motivating components, including: interesting work; achievement recognition; autonomy in work; fine job; high salary; promotion; good working condition; relationship with superiors. After that, this model has been widely disseminated and researched by many researchers and organizations in different industries and fields as Kennett S.kovach (1987) but he added other elements: discipline

            After publishing, motivation model of Kovach (1987) has been recognized by many scientists and widely applied in many different fields, used in many studies such as Simons & Enz (1995) " study factors affecting staff motivation in the hotels”; Siu, Tsang and Wong (1997) "study the factors affecting employees’ motivation in the hotel in Hong Kong"; Charles and Marshall (1992) "study the motivation of employees in the hotel in the Caribbean", Hemdi and Nasurdin, (2003); Silverthorne (1992). In Vietnam, there are also authors using Kovach's research model as Le Thi Thuy Uyen (2007); Nguyen Ngoc Lan Vy (2010) carried out the research topic "Researching factors affecting the level of employee encouragement in work at enterprises in HCM city”. Besides, according to many researchers such as C.Carolyn Thiedke (2004), James R. Linde (1998), motivation model in Kovach's research (1987) are consistent with some famous motivational theories like Maslow's theory of needs and Herzberg's two-factors theory.

After that, there are many authors who apply Herzberg's theory in their researches. In 2007, Boeve carried out the topic: study motivational factors for faculty at US medical universities based on Herzberg's two-factor theory and job description index (JDJ) of Smith, Kendall and Hulin (1969). Research results show that motivational factors include two groups: internal factors: Nature of work, training and promotion opportunities and external factors including: salary, support of superior and relationship with colleagues.

Shaemi Barzoki et al. (2012) conducted an analysis of the factors affecting the motivation of doctrine based on Herzberg. Seven factors affecting the motivation of the staff proposed by the author include: Safety at work, company’s policy, relationships with colleagues and relationships with superiors, working conditions, personal life, salary and bonus. The advantages of the above research models have clearly shown each factor affecting labor dynamics, measuring their impact. This model is also very relevant and is in line with the famous motivational theories, which have been popularized in many countries such as Maslow's theory of needs and Herzberg's two-factor theory. Therefore, the research results are highly reliable. Disadvantages of the above models are not interested in corporate brand elements and corporate culture. These are two important factors in managing and developing the human resources of an organization, especially in multinational and transnational companies.

Teck-Hong and Waheed (2011) studied the factors affecting work motivation with salers in Malaysia. In this work, the theoretical framework proposed by the author is base on Frederick Herzberg’s two-factors theory from 1959. From the data collected from 152 questionnaires, they demonstrated the importance of "working conditions" and "recognition" that affect employees' work motivation. Besides, they found that the "maintenance" factors are more effective than the "motivating" factors in motivating employees.

Barzoki et al (2012) conducted research on factors affecting employees' work motivation on the basis of the two-factor theory by Herzberg (1959). The study used the stratified random sampling method, surveying 147 out of 640 employees working at organizations. The authors’ research model includes 7 factors: (1) Salary, (2) Personal life, (3) Working conditions, (4) Relationship with management, (5) Relationship with colleagues, (6) Organizational policy, and (7) Work safety.

Safiullah conducted research on employee motivation and the most influential factors regarding employee motivation in Bangladesh. The research model is mainly based on the studies by Herzberg et al., Linder, and Hossain et al. Accordingly, the author's research model includes (1) Salary and other financial incentives, (2) Career development opportunities, (3) Relationship with colleagues, (4) Feeling valuable work, (5) Job Security, (6) Good working environment, (7) Flexible working hours and (8) Interesting and challenging work.

Denibutun (2012) has conducted his research “Work motivation: a theoretical framework”. According to this research, many different theories have been established all over the world to explain the nature of work motivation. This article is made to explore differences between the theories of such work motivation and consider the motivation as a process of basic human psychology. The theories of motivation help explain the behavior of a certain person at a certain time. Such theories can be divided into 2 groups: (1) the theory of content focuses on the identification of personal needs which affect their behavior in the workplace, (2) the theory of process focusing on the process of human thinking. This thinking process can affect the decisions to perform different actions of humans in their work.

            In Vietnam, work motivation is also very interested for researchers. First of all, it is necessary to mention the research of Tran Kim Dung (2011) on employee motivation scale. The study used Confirmatory Factor Analysis (CFA) and based on a survey sample with 445 employees working in Ho Chi Minh City. The results show four factors, namely: 1) Appropriate work; 2) Reasonable remuneration policy (salary, welfare, promotion); 3) Good relationship at work; and 4) Company brand. In particular, the elements of the policy and reasonable remuneration have the strongest impact on employees' motivation. But the study is limited on the workers in Ho Chi Minh City, the results are not representative and accurate for different regions and other types of companies.

            In 2010, Le Dinh Ly published his thesis "Policy to motivate communal Public Servants (An Empirical Study in Nghe An province". With the application of Herzberg's two-factor theory, the author analyzed and evaluated the status of some policies affecting the factors of motivation and maintenance. It is interesting in this study that while Herzberg said that wages were a sustaining factor, this research said that this was a very motivating factor. This is a new result that later studies need to be concerned about. However, Communal Public Servants have different characteristics compared employees in other companies and enterprises, especially in multinational and transnational corporations. So, the results maybe are not true for all.

            Loc conducted a study that aims to analyze the factors affecting work motivation of cadres, civil servants, and officials in Ninh Kieu District. The author conducted an empirical investigation from the opinions of 250 officials and civil servants and 36 key officials at 13 state management units, 10 administrative units, and 13 wards in the District. the authors proposed a research model based on Maslow demand tower and Nevis (1983) but has been adjusted and supplemented to suit the research subjects of Vietnamese officials. Accordingly, the author's research model includes 4 factors, namely “The interest and recognition of leaders and colleagues”, “Public relationship”, “Nature of work”, “Opportunities for learning and advancement”. They have a positive impact on the employee motivation.

            Overall, most previous studies are based on Frederick Herzberg’s two-factors theory (1959) to assess factors affecting employees' work motivation. However, some studies have limitations.

Firstly, although there have been many studies on this issue, researches are different in method, subject and scope. In the study of Buelens & Van Broeck (2007) in Belgium; Nawab (2011) in Pakistan, they have shown the difference in employee motivation between public sector and private sector. It means that, in different types, the application results of motivational models are not the same. In particular, in Vietnam, there has not been any research about work motivation in multi-national and transnational companies. This is a new point on the author’s research.

Secondly, many models of motivating components over the past 50 years usually focus mainly on job attributes, not much enterprises themselves such as "company brand". In particular, for multi-national and transnational companies, the company's brand factor is a great strength to attract and motivate for employees. In fact, when employees feel proud of their business, they will stick with the business more.

In the world, there have been studies on this issue. According to Hepburn (2005), Minchington (2006), Barrow and Mosley (2010), brand is a factor that "has a strong impact to attract and maintain good employees".  In Asia, Zhou's study (2008) show that in China's labor market, the companies use brands to attract talented candidates.

According to Stephen Overell (2003), Hay Group's research in 35 large companies including Oracle, Boots, BMW, found five key elements of encouragement: 1) Internal brand; 2) Organizational values; 3) good leadership; 4) interesting and challenging working environment; 5) Administration of work performance.

Finally, in Multinational companies, there is different about culture of employees. It also effects to their work motivation. In the world, there have been authors studying this factor but still very limited in quantity. Authors as Nevis (1983), Hofstede (1984), Trompenaars (1993) (in Gambrel & Cianci, 2003) all come to the conclusion that the motivations models come from Europe or the United States - which are countries with individual cultures - need to be adjusted appropriately before applying to countries with collective cultures such as China, Hong Kong, Taiwan or Vietnam.

            Mahal (2009) studied the influence of organizational culture and organizational atmosphere on employee motivation levels in Ranbaxy (India) and concluded that: To enhance employee motivation, businesses need to improve their culture and organizational atmosphere. Poornima's study (2009) mentions that human resource management needs to improve the organizational atmosphere to encourage IT staff.

            Based on a survey of 312 people at a multinational company with branches in 40 countries, Larsson et al.,(2007) concluded that: Culture is positively related to employees’satisfied and the time they stay in the organization.

III. Theoretical Framework and Hypothesis of the Study

            Based on the objective and the study of the literature, the theoretical framework of the study is shown in figure 1. There are seven hypothesis tested as listed below. In this work, the theoretical framework proposed by the author is base on Frederick Herzberg’s two-factors theory from 1959 but has been adjusted and supplemented to suit the research subjects who are employees in MNCs in Vietnam.

H1: There is a positive relationship between good working condition and employees’ motivation in MNCs

H2: There is a positive relationship between wages and benefits and employees’ motivation in MNCs

H3: There is a positive relationship between nature of work and employees’ motivation in MNCs

H4: There is a positive relationship between training - promotion and employees’ motivation in MNCs

H5: There is a positive relationship between relationships at work and employees’ motivation in MNCs

H6: There is a positive relationship between Company brand and employees’ motivation in MNCs

H7: There is a positive relationship between Company culture and employees’ motivation in MNCs.

IV. Conclusion

No individual is the same, and that needs to take into consideration when talking about motivation to go to work. A manager needs to observe the individual and their individual needs. It is not possible to give one answer to what motivates employees who work with routine based tasks, as everyone is different and therefore get motivated by a variety of factors. In this article, the author built a theoretical framework for the purpose of discovering the key factors affecting the work motivation of employees in MNCs in Vietnam. The author hopes that this article is background for later studies about motivation of employees in MNCs.

 

REFERENCES:

  1. Abby M.Brooks (2007), Factors that influence employee motivation in organizations, The University of Tennessee, Knoxville, US.
  2. Hackman, J.R. & Oldham, G. R. (1976), Motivation through the design of work, test of a theory. Organizational Behavior and Human Performance, New York, page 16,250-279.
  3. Lê Đinh Ly (2010), Policy to motivate communal Public Servants (An Empirical Study in Nghe An province), thesis in economics, National Economics University.
  4. Mc Clelland D.C (1985), Human Motivation, Scott, Glenview, IL.
  5. Mohammad Kamal HossainI, Anowar HossainII (2012), Factors affecting employee’s motivation in the fast food industry: The case of KFC UK LTD, prescott, Arizona, USA.
  6. Kovach (1987), What motivates employees workers and supervisors give different answers, Business Horizons Sept-Oct, 58-65.
  7. Tran Kim Dung and Nguyen Ngoc Lan Vy (2011), employee motivation scale, Economic development magazine.

XÂY DỰNG KHUNG LÝ THUYẾT VỀ ĐỘNG LỰC LÀM VIỆC CỦA NGƯỜI LAO ĐỘNG TẠI CÁC CÔNG TY ĐA VÀ XUYÊN QUỐC GIA TẠI VIỆT NAM

PHẠM THỊ HƯỜNG

Đại học Quy Nhơn

TÓM TẮT:

Trong phạm vi bài viết này, tác giả xây dựng một khung lý thuyết phục vụ cho mục đích khám phá các nhân tố chính ảnh hưởng đến động lực làm việc của nhân viên ở các công ty đa quốc gia (MNCs) tại Việt Nam. Tác giả sử dụng phương pháp nghiên cứu phân tích - tổng hợp nhằm kế thừa những phát hiện có giá trị từ các nghiên cứu trước của cộng đồng khoa học trong và ngoài nước. Khung lý thuyết do tác giả đề xuất dựa trên sự kế thừa của các nghiên cứu trước, nhưng đã có sự điều chỉnh, bổ sung cho phù hợp với đối tượng nghiên cứu là nhân viên ở các công ty đa quốc gia tại Việt Nam. Kết quả nghiên cứu cho thấy, mô hình lý thuyết do tác giả đề xuất bao gồm 8 thang đo và được đo lường thông qua tất cả 36 biến thành phần.

Từ khóa: Động lực, lao động, công ty đa quốc gia.