Introduction
Company Background
The Bank for Investment and Development of Vietnam JSC – Ho Chi Minh City Branch (BIDV.HCMC), established in 1976, is one of the oldest branches of BIDV and has grown to become one of its largest units, boasting total assets of approximately VND 20,000 billion and contributing around 10% to BIDV's overall profit after tax, according to the 2017 financial statements BIDV.HCMC primarily focuses on individual customers and large corporate clients in sectors such as construction, high technology, building materials, agriculture, and commerce Additionally, it serves as a key training ground for future leadership within BIDV, highlighting its importance in human resources development.
Table 1: The size of debt and deposit from 2014 to 2016
Table 2: The income of credit, deposit and other services from 2014 – 2016
BIDV.HCMC stands out as a key player in both domestic and international business networks, benefiting from quality management systems that are regularly assessed by the International Organization for Standardization (ISO 9001:2015) As one of the experimental branches, it is chosen to implement various international standards, such as Basel, and to test banking products prior to their full rollout across the system Additionally, BIDV.HCMC serves as a crucial payment intermediary for numerous domestic and international organizations, including those involved in Foreign Direct Investment.
The branch’s structure and general goals
Figure 1: BIDV.HCMC organizational structure
BIDV.HCMC's organizational structure adheres to the BIDV policy of a standardized branch model, featuring a Board of Directors and five key operational divisions: Customer Management, which encompasses Corporate Customer Management (CCM) and Individual Customer Management (ICM); Risk Management; Operations, including the Credit Administration, Customer Service, and Vault Service Departments; Internal Management, comprising the Financing and Planning, Organization, and Human Resources Departments; and subsidiary units, also known as Transaction Offices A detailed table presents the total number of employees across all levels within BIDV.HCMC.
Table 3: The total number of employee at all levels in BIDV.HCMC in 2018
Internal management Financing and Accounting 15 6%
Source: Department of human resource management
From 2017 to 2020, BIDV aimed to maintain its leading position in market share and scale while regulating the domestic financial market The BIDV system, particularly BIDV.HCMC, focused primarily on traditional banking services such as credit, guarantee issuance, deposits, international payments, and trade finance, along with other banking products like internet banking and card services Thus, traditional banking remains BIDV's top priority.
From 2017 to 2020, Mr Van Dinh Hai, Director of BIDV.HCMC, emphasized the vital role of corporate banking during a Corporate Banking Meeting in March 2017 He highlighted that while retail banking is a growing trend, corporate banking remains essential for the bank's performance, contributing approximately 80% of its income The bank has successfully attracted a diverse range of large and SME corporate customers, which serve as a significant competitive advantage Therefore, maintaining these customer relationships is crucial for the long-term success of BIDV.HCMC, underscoring the importance of the front-office division in business operations.
Problem context
The CCM departments play a crucial role in BIDV.HCMC by focusing on three primary responsibilities: developing and maintaining customer relationships, evaluating and submitting credit proposals for higher-level approval, and collaborating with other departments to enhance business operations As a vital component of income-generating activities, these departments employ approximately 20 percent of the branch's workforce Given the complex nature of credit activities, which involve navigating various internal and external factors such as laws, finance, customer business characteristics, and BIDV's strategies, employees in the customer management division must possess strong skills, adhere to regulations, and commit to lifelong learning, despite the competitive remuneration offered.
The CCM departments are essential for the successful operation of the branch, significantly contributing around 76 percent of its total income in 2016.
Table 4: The income of debt, deposit and other services of BIDV.HCM by category of CCM and ICM departments from 2014 to 2016 (BIL VND)
Departments DEPOSIT CREDIT OTHER SERVICES TOTAL
BIDV.HCM's performance is primarily focused on three service groups: deposit services, credit services, and additional offerings such as domestic and international payments, trade finance, internet banking, and insurance The evaluation of performance is based on two key factors: size, indicated by the balance of debt and deposits, and efficiency, measured by income from these service groups Data from 2014 to 2016 shows a significant increase in both debt and deposit balances, with growth rates of 37% and 28%, respectively Despite this growth in size, efficiency has not kept pace; income growth rates have declined during the same period, particularly for credit services, which experienced a significant decrease of 6% and 13% in 2015 and 2016, respectively, culminating in an overall decline of 18% throughout the surveyed period.
Analysis of total income from the CCM and ICM departments reveals a significant decline from 2014 to 2016, particularly in the corporate customer sector Specifically, credit services experienced a 10% decrease in 2015 compared to 2014 and a further 15% drop in 2016 Other services also saw reductions of 4% in 2015 and 2% in 2016 This data indicates that the overall decline in total income during the surveyed period primarily originated from the CCM departments.
Table 5: The growth of net income of loan, deposit and other services classified by departments from 2014 to 2016
The author has identified both subjective and objective factors contributing to the declining performance of BIDV.HCMC, in addition to the reduction in income from corporate clients.
BIDV faces significant challenges in its performance due to increasing competition from numerous commercial banks, particularly foreign-invested institutions like HSBC, ANZ, and Hong Leong Bank in Ho Chi Minh City These competitors not only offer a wide range of banking services similar to BIDV but also provide unique products tailored to the evolving needs of customers Major rivals include Vietcombank and Vietinbank, alongside foreign banks such as ANZ and HSBC A common strategy among these competitors is to attract corporate customers by offering cost-effective services, complicating BIDV's efforts to negotiate with existing clients and acquire new ones The market share and credit growth rates as of June 30, 2018, clearly illustrate the intensified competition that BIDV, particularly in Ho Chi Minh City, is currently facing.
Table 6: The market share of credits amongst banks in 30/6/2018
Table 7: The growth rate of credits amongst the selected banks in 30/6/2018
(Source: The mid – annual reports of banks in 30/6/2018)
- Another objective reason could be derived from the internal competitions between BIDV branches as a result of the expansion of new branches (See table 8)
Table 8: The development of BIDV branches in the period of 2010 – 2017
(Source: the BIDV annual reports)
The growth rate of credits
No of domestic branchs of the entire BIDV
No of branches in HCMC
Particularly, BIDV.HCMC is one of the main branches that are responsible for expanding the network of BIDV in Ho Chi Minh City In the period of 2014 –
In 2017, BIDV.HCMC expanded by opening five new branches, leveraging its customer base, debt, and deposit balances, as well as human resources This growth not only increased the size and income of BIDV.HCMC but also fostered internal competition among its branches in Ho Chi Minh City However, this expansion has led to a shortage of experienced personnel at BIDV.HCMC, as skilled staff were reassigned to the new branches While the BIDV network has grown and the brand has gained recognition, these developments have significantly impacted the performance of BIDV.HCMC.
The high turnover rate among BIDV.HCMC officers, particularly in the CCM departments, is a significant concern, as evidenced by the data presented in Tables 9 and 10 According to Price and Mueller's Causal Model of Turnover (1981), turnover rate reflects the percentage of employees resigning within a specific timeframe Table 9 highlights a stark contrast in the number of officers departing across various departments, clearly showing that the CCM departments experience the highest turnover rates.
Table 9: The number of BIDV.HCMC officers leaving job in 2014 – 2017
No The number of officers leaving their jobs 2014 2015 2016 2017
(Source: the BIDV.HCMC annual reports)
Employee turnover at BIDV.HCMC has become a significant issue since 2014, driven by various subjective and objective factors such as employee expectations, company culture, promotion opportunities, professionalism, individual development, and internal communication This rising trend in staff resignation, particularly among CCM employees, raises concerns for managers at all levels regarding the retention of human resources as a competitive advantage and the achievement of branch business goals.
Table 10: The number of staff leaving their CCM duties from 2014 – 2017
2 Number of people leaving job 2 3 6 12
(Source: the BIDV.HCMC annual reports)
High turnover rates are a critical factor contributing to workforce shortages and declining organizational performance (Borda & Norman, 1997) From a managerial standpoint, increasing turnover can incur significant costs, as the departing employees often exhibit reduced performance and productivity prior to their exit, which negatively impacts their teams Additionally, resignations place increased pressure on remaining employees, leading to work-life imbalance and diminished morale, ultimately heightening the risk of further turnover (Borda & Norman, 1997; Coomber).
Filling vacant positions can be a time-consuming and resource-intensive process, and prolonged vacancies in critical roles can adversely affect organizational outcomes Consequently, managing and reducing turnover rates should be a significant concern for management.
The decline in BIDV.HCMC outcomes can be attributed to various factors, including high competition from other banks and branches, which represent systematic risks, and a rising turnover rate among CCM departments, viewed as a non-systematic cause This turnover is linked to job satisfaction fluctuations, making it essential to analyze why CCM staff leave their roles Job satisfaction is a critical factor influencing organizational commitment, with studies indicating that dissatisfaction often leads to increased turnover rates While definitions of job satisfaction vary, it is generally seen as the alignment between personal expectations and work outcomes To effectively address the high turnover and related issues, managers must first identify the root causes of dissatisfaction and implement appropriate strategies to enhance the work environment The following section of the thesis will explore these influencing factors and classify elements affecting job satisfaction among CCM staff at BIDV.HCMC based on theoretical examinations and in-depth interviews.
The classification of initial causes leading to the decrease of job satisfaction
The theoretical initial cause and effect map
Intellectual capital, as defined by Longo & Mura (2011), encompasses the assets organizations leverage for competitive advantage, including human, structural, and relational capital Human capital refers to the collective skills, knowledge, and experience of employees that contribute to the creation of both tangible and intangible assets, enhancing the organization’s market competitiveness (Hejazi, Ghanbari, & Alipour, 2016) Relational capital highlights the internal and external networks formed through employee interactions with stakeholders, such as suppliers and customers Structural capital represents the knowledge embedded in databases, patents, and organizational processes Research indicates that intellectual capital significantly influences corporate performance, fosters innovation, and enhances the transfer of skills and knowledge within organizations (Chen, Shih, & Yang, 2011; Kang & Snell, 2009; Reed, Lubatkin, Srinivasan, 2006; Subramaniam & Youndt, 2005) Furthermore, Longo & Mura (2011) found a strong positive correlation between the adequacy of intellectual capital and employee satisfaction, which can lead to various outcomes, including career advancement and reduced turnover intention.
Figure 2: The conceptual cause – effect model of the thesis
The factual cause and effect map
From the perspective of BIDV.HCMC, a comprehensive analysis of interviews reveals various factors contributing to the decline in job satisfaction among CCM employees These factors are systematically categorized into three main groups: human capital, structural capital, and relational capital.
11), then lists them into the initial cause – effect map (see figure 3), as below:
Table 11: A variety of reasons acquired through the interviews
The lack of democracy at work and the internal communications are negatively influenced due to the large power distance
The adequatesness of intellectual capitals:
The employees' attitudes and spirits fluctuate from low to high (i.e turnover, neglect, aspiration, etc.)
The internal procedures are somewhat complicated and the empowerment is low, this fact leads to the lateness in solving the customers’ needs
Due to the overlapped rules and procedures, the higher managers tend to avoid the uncertainty by shifting the responsibilities onto the lower levels
The inexperienced – leadership skill managers implicitly make their subordinates incapable due to inefficient feedbacks and knowledge sharing
Unfair promotions are based on personal relationships, and feeling – based judgments The workers are incapable in arranging time and balancing between work – life lead to work – life imbalance
Figure 3: The initial cause – effect map
This thesis analyzes the cause and effect relationships identified through interviews, revealing that various practices negatively impact the satisfaction of CCM officers, leading to consequences such as discouragement and turnover intentions Job satisfaction emerges as a central issue, influenced by multiple independent variables known as intellectual capitals The findings indicate that a lack of intellectual capitals is implicitly reflected in unfavorable workplace practices, including ineffective internal communications and unfair promotions The next section will further explore these findings based on the interview data.
The shortage of intellectual capital
The shortage of human capital
The inexperienced - leadership skill managers
The inefficient feedbacks and knowledge sharing
The personal relationships and the feeling - based judgments
The incapability of time arrangement and balancing between work and life
The shortage of structural capital
The high uncertainty and the overlapped rules and procedures
The low empowerment and the conplicated working procedures
The delayed and late working processes
The shortage of relational capital The large power distance
Ineffective internal communication and a lack of internal democracy in the workplace can significantly impact employee satisfaction This article explores the deficiency of intellectual capital and its consequences by examining relevant literature and connecting it to practical factors such as the working environment and work-life balance.
The literatures for the elements affecting to the job satisfaction and the connections of these
Working environment
Job satisfaction is a key factor influencing employee behavior in the workplace, shaped by their perceptions and beliefs about their roles This satisfaction can vary significantly due to various internal and external factors Employees form opinions on several aspects of their jobs, including job responsibilities, relationships with colleagues and supervisors, and compensation These elements constitute the work environment and have a profound impact on individuals' job performance, attitudes, and overall satisfaction.
Numerous empirical studies in human resource management across various industries indicate a strong positive correlation between the working environment and job satisfaction (Leiter and Laschinger, 2006; Aiken et al., 2001; Anitha, 2014; Raziq and Maulabakhsh, 2015) A motivating work environment enhances employee performance and job satisfaction, particularly in human capital-intensive sectors such as financial services, healthcare, and education (Marin – García, Bonavia, and Losilla, 2011) The term "working environment" encompasses various definitions, with key influencing factors on employee morale and performance Theoretically, it can be defined as a combination of three essential elements: technical, human resource, and organizational (Kohun, 1992; Opperman, 2002) The alignment of these elements within the context of BIDV.HCMC will be explored in the following subsections.
Physical working conditions refer to the technical facilities that organizations invest in to support their employees in executing their duties effectively This includes essential elements such as tools, equipment, office layout, ventilation, lighting, noise control, and technological infrastructure.
In the context of workplace psychology, research indicates that a well-designed workstation can significantly enhance job satisfaction (Newsham et al., 2009; Tomovska – Misoska et al., 2014; Brill & Weidemann, 2001; Wineman & Adhya, 2007) Employees in the banking sector, who predominantly engage in indoor activities, benefit from a comfortable and well-equipped workplace, which not only boosts productivity but also offers advantages such as cost and time savings, as well as health protection However, within BIDV.HCMC, the influence of the workplace environment on job satisfaction appears minimal, primarily due to its advantageous location on Nguyen Cong Tru Street in District 1, HCMC.
The "Wall Street of Saigon" significantly enhances income-generating activities for staff, such as transactions and notary-related services From a Vietnamese perspective, investing in the branch's physical appearance is seen as a key strategy to build trust and attract more customers, leading the board of directors to prioritize the creation of a more convenient workplace This includes regular testing and maintenance of tools, equipment, and the internal computer network to ensure high-quality services Employee perceptions of the branch's physical factors are generally positive; however, findings from in-depth interviews indicate that there is no empirical evidence linking technical elements to the satisfaction of BIDV.HCMC staff.
Interactional justice plays a crucial role in fostering positive social relationships and effective support within the workplace, particularly between employees and their peers (Colquitt, 2001) This concept encompasses two key components: interpersonal justice, which pertains to the respectful and fair treatment of employees by managers during various work-related processes, and informational justice, which involves providing clear explanations for decisions and procedures For organizations to maintain a loyal and dedicated workforce, it is essential for management to prioritize interactional justice at all levels A lack of facilitation in promoting justice can lead to serious issues, such as decreased job satisfaction and productivity (Amabile and Kramer, 2011) At BIDV, a formal code of conduct outlines expectations for employee behavior and interactions, aiming to uphold fairness and democracy in the workplace However, factors such as power distance and uncertainty avoidance may contribute to perceived interactional injustices, particularly in internal communications and promotion decisions Interviews reveal that these injustices negatively affect employee satisfaction and contribute to higher turnover rates among staff at BIDV.HCMC.
Finally, organizational element refers to: (1) internal systems, policies, procedures, and
Organizational cultures and internal policies play a crucial role in fostering distributive and procedural justice within a company Distributive justice, as defined by Adam (1965), refers to the fair allocation of resources and outcomes, which can manifest in both tangible forms like salaries and bonuses, as well as intangible forms such as promotions Adam also emphasizes that equitable distribution enhances employees' perceptions of fairness Meanwhile, procedural justice, according to Leventhal (1980), pertains to the fairness and transparency of the processes that lead to these outcomes This form of justice is reinforced when employees can voice their opinions and when processes are characterized by consistency, accuracy, ethical standards, and impartiality In the context of BIDV.HCMC, staff perceptions regarding remuneration will be analyzed to assess both distributive and procedural justice, with a particular focus on how organizational culture influences these perceptions amidst uncertainty avoidance.
The term "remuneration" refers to the compensation and promotion policies offered in exchange for services rendered In terms of compensation, which is a form of short-term remuneration, findings from BIDV.HCMC indicate that most CCM staff are satisfied with their current compensation levels Therefore, it is clear that compensation is not the primary reason for the decline in satisfaction among CCM staff.
Mr Tran Hoai Nam reveals that with three years of experience, his monthly income averages nearly 30 million dong, making it quite competitive compared to his peers in other banks.
Mrs Ha Ngoc Giang expresses her complete satisfaction with the compensation provided by her bank, stating that it is not only deserved but also higher than what most banks in Ho Chi Minh City offer.
According to an empirical study published by Navigos Group, a leading human resource services firm in Vietnam, BIDV employees earn an average income that ranks third among employees in the banking sector.
Table 12: the average income per head (in VND million) of several surveyed banks in 2016 – 2017
Promotion in the workplace signifies significant advancements in an employee's career, leading to higher hierarchical positions with increased responsibilities and more attractive compensation packages (Malik, Danish, and Munir, 2012) At BIDV.HCMC, the average salaries for higher-level positions are nearly double those of lower-level roles The following table will present the average salaries for various positions, ranging from substitutes to department heads, while excluding the salaries of deputy directors and directors for this thesis, as recorded in 2018.
Table 13: The average salaries of some positions at BIDV.HCMC in 2018
Substitute 5 20 22 24 26 A new officer would receive an average salaries about 20 million VND/month in accordance with Level 5 class 1 After each three – year of work, his/her salaries will be enhanced to a higher rank (i.e Level 5 class 2,
6 23 25 27 29 The employee must have at least 1 – year experience and undertake more complicated works than level – five colleagues
7 35 38 41 44 These levels are only assigned to the deputy – of – head positions
Head of 9 55 58 61 64 These levels are only assigned to the head – of
Vietinbank Vietcombank BIDV Techcombank VIB MBBank ACB
Position Level Class Notes department 10 65 68 71 74 – department positions
(Source: the department of human resource management)
Due to the scarcity of managerial positions, practitioners find it essential to make well-informed decisions that ensure procedural justice in promotions.
- Individuals who are selected will be well – qualified for the required adaptation and response flexibly to their changing environment, and
- The perception of impartiality of managerial promotion procedures amongst employee (De Pater, Van Vianen, Bechtoldt, and KLEHE, 2009)
Mrs Le Thi Kim Nhan, Head of the Human Resources Department, emphasizes the importance of procedural justice in promotions, advocating for the selection of candidates based on their past performance, managerial skills, and communication abilities She notes that while the ideal candidates should gain approval from the board and demonstrate their capabilities to colleagues, there are instances where promotions are influenced by unexplained directives from the branch Director This leads to the selection of less qualified individuals for key positions, creating tension between the HR Department and the Board of Directors Such practices foster perceptions of unfairness in promotions and performance evaluations, particularly among overlooked candidates, ultimately diminishing job motivation and satisfaction within the organization.
Work – life balance
In today's fast-paced world, individuals face conflicting pressures between work and personal life, leading to challenges in maintaining a healthy work-life balance This imbalance significantly impacts workplace issues, including employee turnover, job satisfaction, and overall productivity Research indicates that a positive work-life balance correlates with enhanced quality of life and job satisfaction while reducing anxiety and depression Consequently, work-life conflict has become a critical concern in human resource management, necessitating attention from policymakers, organizations, and employees alike This section will explore the sources of work-life conflict, drawing on various studies that address time-based and strain-based conflicts.
Employees often juggle multiple responsibilities throughout their day, with time allocated to specific job duties—such as work schedules and orientation—typically unable to be transferred to other personal roles like parenting, education, or household tasks This time-based conflict arises from two main factors: the pressure of job-related obligations and the demands of other personal roles (Pleck, Staines, and Lang, 1980; Kahn, Wolfe, Quinn, Snoek, and Rosenthal, 1964).
Time pressures on employees, such as business trips and tight deadlines, can hinder their ability to meet demands from other roles, leading to work-family tension Research indicates that excessive weekly working hours and frequent overtime contribute significantly to this conflict (Burke, Weir, and DuWors Jr, 1980; Keith and Schafer, 1980; Pleck, Staines, and Lang, 1980; Bohen and Viveros-Long, 1981).
Mrs Nhan acknowledges a significant increase in resignation rates, primarily due to work-life conflict Unlike previous generations, today's workforce, especially younger employees, seeks career options that align with their personal values and ensure a healthy work-life balance Additionally, many employees, particularly women, prioritize family care, personal development, social relationships, and health This trend of resignations has adversely affected current staff across both back and front departments, leading to a shortage of employees in front-facing roles, which has necessitated the reassignment of personnel from back departments.
Work-life conflict often arises in family practice roles due to the significant time demands of both work and personal responsibilities Bartolome (1972) highlights that non-work pressures can lead employees to focus on their personal roles, even while trying to fulfill job obligations Research by Herman and Gyllstrom (1977) indicates that married individuals experience greater work-family conflict compared to their unmarried counterparts Similarly, Greenhaus and Beutell (1985) suggest that parents are likely to encounter more work-family tension than those without children.
Mrs Ha Ngoc Giang, a credit officer in the CM department, expressed her concerns about the increased workload following the resignation of younger colleagues, which has led her to work later hours, typically until 7:00 or 8:00 PM With the implementation of new ISO standards by BIDV, she now has only two days to complete credit reports instead of the previous three, leaving her with little time for personal and family care This situation has caused fatigue and dissatisfaction among her colleagues, who are envious of the better circumstances of former staff members who have left the company.
The second type of work-life tension is characterized by role-produced strain, which leads to strain-based conflict This conflict manifests through symptoms such as fatigue, irritability, and depression, as negative emotions from one role negatively impact performance in another Consequently, this spillover effect makes it challenging to fulfill the demands of different roles effectively.
1985) There are also two explainable dimensions for this form of conflict, including work – related stress, and family disapproval
Unfavorable working practices significantly contribute to work-related stress by diminishing employees' morale, job satisfaction, and commitment, leading to increased work-life conflict Factors such as role ambiguity, lack of supervisor support, poor job-personal capacity fit, and unmet expectations create tension and dissatisfaction in the workplace (Jones and Butler, 1980; Kopelman, Greenhaus, and Connolly, 1983; Bartolomé and Evans, 1979).
Mr Dang Cong Duy, a former CCM officer, revealed that the primary reason for his resignation was work-related stress He faced significant challenges when one of his clients neared bankruptcy, leading to bad debts with BIDV.HCMC This situation caused him considerable trouble with the Department of Risk Management and Credit Administration, as they demanded explanations and credit profiles The ongoing issues not only consumed his time but also adversely affected both his professional responsibilities and personal life.
Family-related conflicts often arise from a lack of support and sympathy between spouses, which can stem from differing career orientations and beliefs about gender roles (Chadwick, Albrecht, and Kunz, 1976) Such behaviors contribute to a tense family atmosphere and increased work-life conflict (Holahan and Gilbert, 1979) For instance, Hall (1972) found that married women juggling multiple roles face the risk of conflict, suggesting that a husband who embraces feminist attitudes may help mitigate his wife's work-life challenges.
Figure 5: the cause and effect map
Cause validation
According to a cause and effect analysis and insights from eight in-depth interviews, along with secondary data from the HRM department, the primary factors contributing to high staff turnover at BIDV.HCM are promotion opportunities, management style, and work-life balance It is crucial for BIDV to implement effective strategies to address these issues promptly.
The promotion process faces significant challenges due to various factors Firstly, while the existing promotion rules aim to uphold procedural and distributive justice, biased candidates still qualify for the official standby list This is often influenced by social issues such as personal relationships, discrimination, and other subjective factors that lead to ambiguous judgments by the board of directors, resulting in biased promotions Addressing these complex social issues is a daunting task that extends beyond the scope of this thesis Furthermore, the dissatisfaction among BIDV staff is partly attributed to these biased promotions, highlighting the need for a more equitable process.
Other roles time - based conflict
Non - work strain - based conflict
High turnover rates are particularly prevalent in deputy head positions, which play a crucial role in overseeing technical controls These leaders are essential for ensuring that their departments' internal operations align with business targets and objectives.
Defining organizational targets requires advanced capabilities beyond technical skills, leading to decisions made by higher management, such as department heads and the board of directors Promotion to higher ranks, particularly within the board, involves input from multiple stakeholders—including the current board, human resources committees, labor unions, and local branches of the State Bank of Vietnam—to ensure a more democratic and transparent selection process for candidates Ultimately, while some candidates may not be the most exceptional, they often fulfill the basic work requirements, despite potential biases in the selection process.
While work-life balance is often cited as a reason for employee resignations at BIDV, it does not fully explain the high turnover rates The bank's ongoing business growth has led to increased working pressure on its staff, compounded by official rules that limit employee numbers based on branch profits Consequently, recruitment is carefully managed to maintain profitability per employee Furthermore, BIDV's human resource development policies focus on training that encompasses both specialized knowledge and effective work methods, aiming to boost productivity and promote work-life balance Ultimately, work-life balance is a personal responsibility for each employee, making it challenging for BIDV to implement specific policies that meet everyone's needs; instead, the bank offers general human resource policies, such as training and remuneration, while encouraging employees to take initiative in managing their own work-life balance.
It can be seen that organizational culture, especially in uncertainty avoidance and power distance are considered as principles behind the levels of workers’ satisfaction
Uncertainty avoidance significantly impacts employee satisfaction at BIDV, closely tied to the regulations of both BIDV and the State Bank of Vietnam Addressing this issue requires long-term involvement from various stakeholders, a complexity beyond the scope of this thesis Consequently, this thesis will focus on power distance as a contributing factor to the high turnover rate at BIDV.HCM, driven by three primary reasons.
The primary factors contributing to high employee turnover, as identified by participants in comprehensive interviews, are rooted in power distance and uncertainty avoidance A lack of democratic decision-making and insufficient respect for personnel across all levels create a challenging work environment Additionally, the tendency to evade responsibility by shifting it to others further exacerbates the issue.
Mrs Le Thi Kim Nhan – the head of human resources management admits that:
High power distance leads to undemocratic decision-making, particularly in setting business objectives Additionally, uncertainty avoidance makes it challenging for substitutes to obtain adequate and timely support from their managers Consequently, this results in unmet business goals and a lack of empathy, fostering feelings of dissatisfaction and depression among employees.
Mr Tran Hoai Nam, a CCM officer, emphasizes the importance of managerial involvement in addressing complex challenges He believes that to achieve business objectives, managers should actively facilitate and participate in problem-solving rather than merely assigning blame without offering constructive advice.
Employee salaries are directly impacted by branch performance The overwhelming business goals, coupled with insufficient managerial support, have led to a decline in risk appetite among employees.
In other words, the hunger for loans causes the employees to accept the riskier debts
Long-term exposure to the adverse effects of debts, such as the allocation of bad debt provisions, can significantly reduce a branch's profits and employee incomes, ultimately leading to a detrimental impact on organizational commitment.
Ms Tran Thi Thanh Thao, a CCM officer, expressed concern over her salary growth, stating that in 2018, it only increased by 5% compared to 10% in 2017 and 15% in 2016, which may not keep pace with inflation She highlighted that provisions for significant bad debts will be gradually allocated from 2018 to 2023, exacerbating her worries about financial stability.
Interviewees experiencing work-life balance issues at BIDV.HCM identified power distance and uncertainty as significant contributing factors The high power distance in this context is evident in the centralized decision-making processes and a lack of democratic engagement, which can lead to feelings of injustice among employees in extreme situations.
Ms Truong Thi Minh Hieu, a former officer at BIDV, expressed her struggle to adapt to a workplace lacking respect and friendliness from her superiors, despite her dedication to her job She faced verbal aggression for minor mistakes and received ambiguous guidance during challenging situations, which created confusion and increased her stress levels The demanding workload made it difficult for her to balance work and family life, often requiring her to work late into the evening Ultimately, she chose to leave her position at BIDV in search of a more manageable job that would allow her to care for her family.
BIDV.HCM has identified organizational culture issues as a key factor contributing to its high turnover rate In response, the board of directors has implemented various strategies, such as recruiting new employees to balance resignations and requesting the BIDV Head Office to extend bad debt provisions from five to ten years to support employee income growth Additionally, they are considering increasing bonuses during significant occasions like the Lunar New Year and Independence Day, along with enhancing allowances for business trips, health, and overtime However, the effectiveness of these measures has not met expectations, indicating that they may lack persuasiveness for addressing the underlying issues.