Excessive working overtime in parapex company

APPENDIX 3: Thesis cover page.

UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business
------------------------------

Nguyễn Nhật Tường Vi

EXCESSIVE WORKING OVERTIME
IN PARAPEX COMPANY

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – Year 2018

1


APPENDIX 4: Thesis title page.

UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business
------------------------------

Nguyễn Nhật Tường Vi

EXCESSIVE WORKING OVERTIME
IN PARAPEX COMPANY

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: DR.LE THI THANH XUAN

Ho Chi Minh City – Year 2018

2


ISB-MBUS INFORMATION FORM

1. Name NGUYỄN NHẬT TƯỜNG VI
2. Date of Birth: 13/10/1988

(Picture)

3. Course year: 2016
4. Mobile: 0936 191 552
5. Email:
6. Home address 129/1L13 Lạc Long Quân, Ward 1, District 11, HCM city.
7. Occupation: Accountant

Position: Manager

8. Office name: Parapex Co., Ltd
9. Office location: Factory 3, D21/II, Number 2B Street, Vinh Loc Industry, Binh Tan District
10.

How have I changed after two years studying at ISB?
-

English and presentation skill was improved more

-

Knowledge in managing, finance was upgraded

11. What I want to share with the juniors is:
-

You should to execute following the instruction of lecturer and university in each
subject.

-

You should read the book, document before coming to class and preparing a list of
questions.

-

You should contribute in class and ask the question to understand deeply the theory.

WISHING YOU EVERY SUCCESS IN YOUR CHOSEN PATH!


CỘNG HÒA XÃ HỘI CHỦ NGHĨA VIỆT NAM
Độc lập – Tự do – Hạnh phúc
-----o0o-----

BẢN CAM ĐOAN
Họ tên học viên: NGUYỄN NHẬT TƯỜNG VI
Nơi sinh : TP.HCM

Ngày sinh : 13/10/1988
Ngày trúng tuyển đầu vào năm : 2016

Là tác giả của đề tài luận văn : Excessive Working Overtime in Parapex Company
Giáo viên hướng dẫn : Dr.Lê Thị Thanh Xuân
Ngành : Tài chính MBUS 6.1

Mã số : 22150080

Bảo vệ luận văn ngày : 17/09/2018
Điểm bảo vệ luận văn : 6
Tôi cam đoan đã chỉnh sửa nội dung luận văn thạc sĩ kinh tế với đề tài trên, theo góp ý
của Hội đồng chấm luận văn thạc sĩ.
TP. Hồ Chí Minh, ngày 21 tháng 10 năm 2018
Người cam đoan

Chủ tịch Hội đồng chấm luận văn

(Ký và ghi rõ họ tên)

(Ký và ghi rõ họ tên)

Hội đồng chấm luận văn 05 (năm) thành viên gồm :
Chủ tịch :……………………………………………………………………..
Phản biện 1:…………………………………………………………………..
Phản biện 2: ………………………………………………………………….
Thư ký : ………………………………………………………………………
Ủy Viên : …………………………………………………………………….

CỘNG HÒA XÃ HỘI CHỦ NGHĨA VIỆT NAM
Độc lập – Tự do – Hạnh phúc
-----o0o-----

BẢNG TỔNG HỢP NỘI DUNG CHỈNH SỬA LUẬN VĂN SAU BẢO VỆ
STT

Nhận xét của Hội đồng

Nội dung điều chỉnh

Số trang trong
luận văn
13

1

-

The definition of turnover rate is placed before general
symptom

2

-

The sale decrease is adjusted as the consequence of the
symptom of high turnover rate

15

3

-

Action plan is explained more.

39

4

-

Put item 2.3 (Reasons of High turnover Rate) after analysing
the data and exploring the tentative problems

20

5

-

Revise the Initial Cause and Effect Map

27

6

-

Numbering parts in page 27, page 35

27 to 35

HỌC VIÊN
(Ký, ghi rõ họ tên)


Individual Assignment Cover Sheet
Subject Name
Lecturer’s Name

Final Thesis
Associate Professor : Mrs.Le Thi Thanh Xuan

Title of Assignment

Excessive working overtime in Parapex Company.

Class

MBus 6.1

Student Name

Nguyen Nhat Tuong Vi

Student Number

22150080

Contact Number or Email
Length

66 pages (including appendix)

Due Date

01st Sep 2018

Date Submitted

01st Sep 2018

Declaration:
 I hold a copy of this assignment if the original is lost or damaged.
 I hereby certify that no part of this assignment or product has been copied from any other student’s work or from any other
source except where due acknowledgement is made in the assignment.
 No part of the assignment/product has been written/produced for me by any other person except where collaboration has been
authorised by the subject lecturer/tutor concerned.
 I am aware that this work may be reproduced and submitted to plagiarism detection software programs for the purpose of
detecting possible plagiarism (which may retain a copy on its database for future plagiarism checking)
Signature: Nguyen Nhat Tuong Vi
Note: An examiner or lecturer/tutor has the right not to mark this assignment if the above declaration has not been signed)

Mark:

Comments:

Excessive working overtime in
Parapex Company
Nguyen Nhat Tuong Vi_22150080

University of Economics Ho Chi Minh city
International School of Business
Thesis - MBUS 6.1

Lecturer: Dr.Le Thi Thanh Xuan

2


EXECUTIVE SUMMARY
Nowadays, many organizations select working overtime as a quick solution to increase
output with low cost, to cover the unexpected absences or to “dig out” the trouble of
broken machinery, rush order from customer. However, high overtime levels will cause
many negative effects such as Increased health issues, Safety risks, Decreased
productivity, High turnover rates, Morale problems, Troubles with family life. Then, it
will hurt the business in long run. This thesis attempts to discover the problem of
excessive working overtime in Parapex company, investigate the causes and establish the
plan of solutions for the problem. The thesis focuses on qualitative method by conducting
the in-depth interview with problem owner and related people. After conducting the indepth interview, the theories from literature review are used to support and explain the
real case. Firstly, through information from HR Department, high employee turnover and
Decreasing in sales performance were considered as two important symptoms that
Parapex company needs to notice. Next, some of resigned workers were interviewed to
find the reason why they decided to quit their job. In addition, the Vice Director of the
company and the supervisor of the factory were also interviewed to understand more
about the situation and to determine the problems. Through the interview and literature

review, four problems were found out which included Excessive working overtime, Low
Salary, Strict Punishment Policy and the far location of the company. Within these
potential problems, Excessive working overtime is selected to be solved in this report
because this problem is the most feasible for solving. After determining the problem, the
interview with Vice Director and HR Officer were conducted to discover the causes of
excessive working overtime problem. Through these interviews, it was recognized that
the supervisor received too much orders from customers without consideration carefully
about the capacity and number of workers. She gave a poor decision of receiving large
orders because she had lack of required skills such as forecasting and production
planning. She did not establish a obvious production planning before deciding to receive
big orders that led to lack of human resources for production and problem of excessive
working overtime. The supervisor of the factory had lack of required skills because of the
3


poor selection in recruitment and lack of training. After finding out the problems and the
causes, the action plan was established base on the possible solutions from literature
reviews and the suggested solution from the problem owner.

4


TABLE OF CONTENTS
EXECUTIVE SUMMARY ........................................................................................ 3
PART1 - COMPANY INTRODUCTION ................................................................. 7
1.1)
1.2)
1.3)

General Information ...................................................................................................7

Organization Chart .....................................................................................................8
HR policies and benefit ..............................................................................................10

PART 2 - PROBLEM IDENTIFICATION ................................................................ 12
2.1)

Problem Context .........................................................................................................12

2.2)

Definition and calculation of turnover rate.................................................................13

2.3)

General Symptom .......................................................................................................13

2.4)

Identifying tentative Problems....................................................................................16
A/ INTERVIEW TO RECOGNIZE THE PROBLEMS ................................................16

1) From Vice Director’s perspective ..............................................................................16
2) From workers perspective ..........................................................................................17
3) From supervisor perspective ......................................................................................19
B/ LITERATURE REVIEW OF THE PROBLEMS .....................................................20
1) Problem 1: Excessive Working Hours .......................................................................22
2) Problem 2: Low Salary ..............................................................................................25
3) Problem 3: Strict Punishment Policy .........................................................................26
C/ MAIN PROBLEM IS SELECTED TO BE SOLVED ..............................................27
D/ INITIAL CAUSES AND EFFECTS MAP ...............................................................27

PART 3 - CAUSES AND EFFECTS OF THE REAL PROBLEM .....................................27
3.1) Interview
1) Causes and effects from Vice Director perspective ...................................................28
2) Causes and effects from Human Resource perspective .............................................29

5


3.2) Literature Review
1) Receiving too much orders .......................................................................................30
2) Affects of poor decision making ................................................................................31
3) Decision making skill and reasons of poor decision making .....................................31
4) Lack of required skill ................................................................................................32
5) Forecasting skill .........................................................................................................32
6) Planning skills ............................................................................................................33
7) Causes of lack of working skills ..............................................................................33

PART 4 - POSSIBLE SOLUTION AND ACTION PLAN .................................................35
1) Possible solution ........................................................................................................35
2) Solution from problem owner’s perspective ..............................................................36
3) Action plan .................................................................................................................37

REFERENCE LIST .................................................................................................... 40
TRANSCRIPT ............................................................................................................ 45

6


PART 1-COMPANY INTRODUCTION

1.1)

General Information

Parapex Company was established in Vietnam in 2000 with 100% foreign capital
investment. The company produces and distributes many types of sport kites and
paragliders to many countries in the world such as England, Russia, Netherland, Italy,
France and Germany.
Mission: “we do our best to offer the most extensive range of gliders possible. Our aim is
to provide a wing for every skill level; from novice to world champion, and for every
style of flight.”
Development and Production:
Parapex uses only the best quality materials from reliable suppliers. Every product is
checked at several stages during production and inspected rigorously at final stage. Also,
test flight is conducted before it is delivered to the client. The company also provides
complete service and technical check-up of the wing.
Products: There are six main types of product which include Paragliders, Paramotor,
Speed Wings, Land Kites, Snow Kites and Kitesurf.

(Note: Picture of products of Parapex)
7


Size and Internal Structure: The size of company is so large with 6 factories and 1
main office. There are more than 600 workers and around 30 office staffs. The workers
are recruited and tested carefully to ensure the high workmanship and skill in sewing.
1.2)

Organization Chart

CEO

Vice-Director
(Production)

Office Manager

st

1 Factory (1 Supervisor, 100
3 HR staffs & 1
Admin

workers)

Import Dpt (1 Leader, 2
staffs & 5 workers)
nd

2 Factory (1 Supervisor, 100
workers)
1 IT staff

Export Dpt (1 Leader, 2
staffs & 8 workers)

rd

3 Factory (1 Supervisor, 100
workers)

th

1 Chief Accountant

Pattern Dpt (1 Leader, 2
staffs & 8 workers)

4 Factory (1 Supervisor, 100
workers)

th

5 Factory (1 Supervisor, 100
workers)
2 Accountants

Testing Dpt (1 Leader,
1 staff & 6 workers)

th

6 Factory (1 Supervisor, 100
workers)

The highest position is Chief Executive Officer (CEO) who obtains an ultimate
responsibility for managing the overall operation of the company. The CEO has authority
for signing the important business contracts to provide best benefit for company. Besides
that, The CEO is responsible for making relevant decisions to ensure the sustainable
development of company.

8


Office Manager: is responsible to manage HR, IT, Admin and Accountant and inform to
CEO the operation of these department.
-

IT Staff: manage the software of company, ensure the good software for every day
operation.

-

HR: includes 3 HR staffs who is responsible for recruiting, timekeeping, managing
insurance and salary of staff and workers, and solve all problems related to HR.

-

Admin: is responsible for all tasks related to admin such as stationery order,
arranging business trips, receiving and transferring outside phones or mails.

-

Accounting: chief accountant allocates the financial resources to maximize
company’s wealth and profitability and 2 accountants are responsible for all tasks
of accounting such as payment, tax, and assets managing.

Vice Director: is responsibility for the productivity and efficiency in the chain of
production.
-

Import Department: includes 1 manager and 2 staffs who contact to local and
foreign suppliers to purchase materials for production and manage the raw
material inventory. Also, they will conduct all documents related to customs and
import duties. There are 5 workers to support the import work such as arranging
the materials in the inventory.

-

Export Department: includes 1 manager and 2 staffs who contact to customers for
exporting products and issuing the invoices. There are 8 workers to support the
export work such as prepare goods for distributing.

-

Pattern Department: includes 1 manager and 2 staffs who design, draw patterns,
choose the suitable materials and create molds for production. There are 8 workers
to support work related to pattern.

-

Testing Department: includes 1 manager and 2 staffs who check the products
carefully before distributing to customers.

-

6 production factories: Each factory includes one supervisor, 4 leaders and near
100 workers. The supervisor manages the production chain and workers of the
9

factories. Each factory produces each type of products such as Paragliders,
Paramotor, Speed Wings, Land Kites, Snow Kites and Kitesurf.
1.3)

HR policies and benefit

Benefit
-

Company will pay 13th month salary and bonus for employees at the end of the
year.

-

Company will evaluate performance each year for increasing the salary and
promotion.

-

Employees will receive the bonus each month base on their performance.

-

Employees will receive the bonus on public holidays

-

Company will organize one trip/year for employees.

-

Annual health check one time/year

-

Company will organize training courses for new employees or new products.

Working hour
-

Employees will work 8 hours per day from 7h30 to 16h30 with 1 hour for break
time from Monday to Saturday. A half of Saturday (4 hours) will be calculated
150% salary for overtime. On Monday, Wednesday and Friday, employees will
work to 20h with 150% overtime salary.

Regulation
-

Employees have to work on-time. If they come late or stop to work soon, they
have to inform to the manager and provide the relevant reasons.

-

Employees have to inform for manager in 3 days before they take leave. In the
special case, they have to phone to manager and explain the reasons for leave.

-

Do not bring food or beverage into factory except purified water.

-

Do not use phone into factory, especially in working time.

10


-

Do not accept fighting, arguing loudly, dishonor or sexual harassment with other
employees.

-

Do not repair the products. Employees have to inform to manager to solve the
defective goods.

-

Do not disclosure the confidential information of company and cause any
disadvantages or bad influence to the image of company.

If employees infringe one time, the company will conduct reprimand report and not
provide bonus in that month. If employees relapse many times, the company will decide
to lay-off the employees.

11


PART 2-PROBLEM IDENTIFICATION

2.1)

Problem Context

In the 3rd factory
Through the observation, it could be recognized that the 3rd factory included around 75
workers. There were 12 workers to produce the skateboards, 55 workers were producing
the kites and 8 workers were checking the products. The supervisor usually went around
the factory to observe and remind the workers for concentrating the products. The
factories seemed to be so quieted. It could only be heard the sound of the machines.
There were only sewing machines in the “kites” chain but many different machines in
“skateboard” chain such as CNC machines, drill machines, Veneer Press machines, Side
Sealer machines, etc. In addition, it could be seen that there were too many parts of
skateboard production such as the wheels, the footstraps, griptapes, decks,
axels,…Almost the workers concentrated to their work. The skateboard chain seemed to
be pressured with the stressful faces of the workers. They seemed to be so tired and
precipitated with their work. There seems to be lack of workers in the skateboard chain
compared to the other chains.
In the office
Through the observation, it can be seen that many workers came to meet the HR to
submit the resignation letter and get the insurance books. There were around 8 workers
came to the office to submit the resignation letter in one month. Each week, 2-3 workers
met the HR staffs for the interview of resignation. In the interview, the workers gave
many reasons for leaving job such as family, new job, the low salary. However, the
common reasons were that they were too tired to work overtime too much.

12


2.2)

Definition and calculation of turnover rate

Turnover rate refers to the rate that employees leave job in a company and are replaced
by new recruits. If turnover rate of company is high, employer should take time to
understand why and find the strategic way to solve it to maintain productivity and to save
time and cost of recruiting, hiring and training. (Leonard 1 ).
There are two general types of turnover that includes voluntary and involuntary.
Voluntary turnover happens when the employees choose to leave the jobs by themselves
for some reasons. Involuntary turnover happens when the employees are laid off or fired
by the company (Reh 2)
“Employee turnover rate” refers to the percentage of employees who leave a company
during a certain period of time. To calculate turnover rate, three numbers are necessary to
use which include the number of active employees at the beginning, and end of period,
and the number of employees who left during the period. (Pavlou 3)
Employees separated
Turnover rate % =

x 100
(Beginning + Ending number of employees)/2

Pavlou

3

also mentioned “If your top performers are leaving, then you should take

immediate action, otherwise your company’s performance will flag. On the other hand,
if your low performers are leaving, you could stand to gain by enjoying better employee
engagement, productivity and profits.”

2.3)

General Symptom

a) Symptom: High employee turnover
After finding out information from HR Department, it is recognized that 26 workers in
the 3rd factory resigned the job in the 1st Quarter of this year and all of them were
voluntary leave. This number is so large that takes more than 25% of total workers in this
factory. The number of resigned workers in this factory is also higher than the last
13


quarters. To illustrate, there were only 18 resignation workers in 2016 with the highest 8
workers in the 1st Quarter of 2016 and there were 23 resignation workers in 2017 with the
highest 9 workers in the 2nd Quarter of 2017. However, this number increased
significantly in Feb and Mar that 26 workers left the company. Especially, there were
only 4 resigned workers in Kite group but 22 of them in Skateboard group.
Year

2016

Quarter
Kites workers
Skateboard
workers
Total resignation
workers

2017

2018

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

5

1

4

2

3

6

4

2

4

3

2

1

0

3

3

1

1

22

8

3

5

2

6

9

5

3

26

(Note: the number of resigned workers of The 3rd Factory from 2016 to 2018)

In the case of Parapex, 26 workers of the 3rd factory leave the job voluntary. This
number of workers seems to be a large number while there are around 100 workers in a
factory.
Quarterly Turnover Rate of Parapex = 26 / (96 + 78)/2 = 29.9%/ Quarter
The number of resignation workers in this factory was also higher than other factories. To
illustrate, 6 workers of the 1st factory quitted the job in the period June and July. There
were only 2 resignation workers in the 2nd factory and 5 resignation workers in the 4th
factory and the 5th factory. The higher number was 9 resignation workers in the 6th
factory. 26 resignation workers in the 3rd factory seemed to be too large because it was
around 5 times compared to other factories.
Factory
N.o of resignation
workers in Q1/2018

1st

2nd

3rd

4th

5th

6th

6

2

26

5

6

9

(Note: the number of resigned workers in 6 factories in Q1/2018)

Reasons of difficulties in recruitment
It is so difficult to recruit new workers because of high requirement of mechanical
qualification and far location of company.
14

This position is not easy to recruit because it requires the people who have high
mechanical qualification and program knowledge (CAD & CAM) to use CNC machines.
Also, the company is located far away the Centre so that it causes difficulties for
recruiting.
According to Vice Director, the 3rd factory produces the snow kites which include the
kites and skateboards. The resignation workers work in the chain of producing the
skateboards which is produced by many high-up machines, especially the CNC machine.
The CNC machine is a high standard accuracy cutting machine with the high price more
than 1 billion VND which is imported from foreign countries. Therefore, company needs
the workers who have good mechanical knowledge and workmanship to use these
machines to produce the quality products and avoid damages for the machines.
b) The consequence of the symptom: Decreasing in sales performance
-

Sale decrease 3 billion VND in 2 months March and April.

Through the interview with Vice Director, it is recognized that this is problem which
need to be solved because it cause negative effects on the sale of company. Company
lost around 3 billion VND in March and April that take 10% of total sale of company.
Decreasing in sales performance is the consequence of high turnover rate. Because the
workers in “skateboard” chain quitted the job, the company did not have enough
workers in producing skateboard which caused lack of products for distribution and
decreasing in sales of company.
The Vice Director was informed from HR Department that these workers quitted the job
because of family reasons, house changing, or health problem. The Vice Director
determined that this is a serious problem and the company wants to find the solution for
this problem to keep these resignation workers. She stated “If the workers left because
they were not pleased with the company and their reasons are relevant, company will be

willing to change and solve the problems to keep these workers because they worked
long time so that they understand company operation”.
15


2.4)

Identifying tentative Problems
INITIAL MAP
High Turnover
Rate

Lack of
workers

Low
Production

Sale
Decrease

A/ INTERVIEW TO RECOGNIZE THE PROBLEMS
1) From Vice Director’s perspective
There are 2 main reasons from Vice Director’s perspective:
-

No opportunity for promotion -> Some good workers move job

-

Large orders and some workers leave -> pressure of work on the current workers
-> work overtime too much -> tired -> leave the job
Too much
customer orders
Too much
working overtime

No
Promotion

High Turnover
Rate

Low
Production

Some workers
quitted job
Sale
Decrease

According to Vice Director, some of workers quitted the job because they had high
potential and good workmanship but did not have opportunity for promotion so that they
changed to larger and more famous company or the higher position. Some of workers left
the company so that the current workers had to share the work of leave workers in the
time of waiting for recruiting new ones. Furthermore, in this period, the company
received some of large orders so the current workers had to work overtime more. This
made them be tired and suffer the work pressure. Then, they decided to resign, too. In the
interview, Vice Director shared “some of workers quitted the job, the remaining workers
had to work more in the time of recruiting the new ones. In addition, in this period, the

company received some of big orders so that these workers had to work overtime more.
16


Maybe working overtime too much because of sharing the work of quitted workers and
producing too many products for the big order made them be pressured so that they
decided to quit job, too”. Too much working overtime hours was the main problem that
made the workers quit the job.
The location of company was also a part of the reasons. Vice Director stated that “Maybe
they found the job near their house or near the Centre.” She also mentioned that the
company intended to hire the bus to provide transportation for the workers who stayed far
company.
Through the interview, it was recognized that at the beginning, the salary of “skateboard
workers” was equal to the salary of other workers but the company evaluated
performance and increased salary for the workers each year. Vice Director said “salary of
the other workers increased 3% to 5% but salary of the workers of this chain increased
5% to 8%. Besides that, the bonus each month of these workers was also higher than the
other workers”. The Vice Director shared that if these workers quitted job because of
salary issue, the company could consider to increase salary to keep them but it would
depend on the performance and experience of the workers and it could not more than
VND 500,000 for each worker per month. However, she did not believe that salary was
the main problem of resignation.
2) From workers perspective

Too much
working overtime

Uncompetitive
Salary

Strict purnishment
regulation

Unpleased with
Supervisor

Far Location of
company

17

High Turnover
Rate


The interviews with resigned workers assist to recognize why these workers decided to
leave company. The interviews provide more details for the problems. In addition, the
interviews assist to understand clearly the expectation from the workers. From that, the
company can find out the solutions for the problems.
The participants of the interviews included four resigned workers in the chain of
Skateboard production. All of them are willing to answer all of the questions within the
interview. The first interviewee was Mr. Thuan (32 years old). The second one was
Mr.Phuc (35 years old). The next one was Mr. Thanh (30 years old) and Mr. Long (32
years old). The responses of interview indicated that most of the interviewees were so
tired because they had to work overtime too much. Normally, the other workers work
overtime on Monday, Wednesday and Friday but they have to work overtime more on
Tuesday and Thursday. Working overtime too much make them feel tired and do not
have enough time for family and children. Mr. Thanh mentioned “Generally, the
company has good benefits such as the bonus for holidays. Each year, the company
evaluates performance for increasing salary and has good insurance benefit, but the

working time is too much so that we don’t have enough time for family and children.
Normally, we were tired when working overtime on Monday, Wednesday and Friday to 8
pm, but in near few months, we had to work overtime on Tuesday and Thursday because
of too many orders.”
Another reason was that the location of company caused inconvenience because it was
far away their house. This took too much time for them to come to the company and
made them be tired because of driving for long time. Mr.Thuan mentioned that “At the
beginning, I know the company was far my house but at that time I did not have too much
working experience. Also, the company had good benefits such as good insurance, bonus
for workers, good salary so that I tried to work. However, my friend introduced me a job
near my house with the good salary so I decided to move job”
The third reason from workers was that they were not pleased with the supervisor
because she always followed the rules rather than be sympathized the workers. One of
18


workers shared that one time he received phone in the factory and his supervisor issued a
reprimand report for infringing regulation rather than listened to his explanation. This
made him loose the bonus that month. Mr.Phuc said “In that time, my child got fever so
that I was so anxious and I received the phone without asking the supervisor. However, it
was not necessary to follow the rules all. There were some situations that we could just
remind.” In the next time, he continued to receive a reprimand report when he argued
with the other worker in the factory. He thought that this was not his fault so that it was
not reasonable for him to receive this report.
One different reason was that the salary was not fair with their knowledge and
qualification. Mr.Long mentioned “This salary is OK for sewing workers but if our salary
is the same, it is not so fair because the company required the high mechanical
qualification and knowledge for our position.” Although the bonus of “Skateboard
workers” is higher than salary of “sewing workers”, “Skateboard workers” still expect the
higher salary rather than the higher bonus because they think that the salary is more

stable than the bonus.
3) From supervisor perspective

Lack of discussion
with the workers

Too much
customer orders

Too much
working overtime

High Turnover
Rate

Low
Production

Sale
Decrease

The supervisor believed that she received too much customer orders without discussing
with the workers. She thought that she needed to discuss with the workers before
receiving the big orders. This would made the workers arrange time for working.
According to the interview with the supervisor (Mrs.Nguyen) of the 3rd factory, the main
reason of resignation was that the workers have to work overtime too much because of
19


the large orders. She also confirmed that the production department received directly the

orders from customers. When the supervisor was asked why the production department
agreed the large orders despite of lack of workers, she expressed that “There were not
large orders for a long time so that production staffs and I thought that there was no
problem if the workers work overtime in a period of time. In addition, the company would
pay enough overtime salary and the overtime salary was higher than the normal working
hour so workers would receive enough benefits”. The supervisor was worried that if the
production department did not accept the orders, the customers would contact to other
suppliers and the company would lose the customers. She and other staffs wanted to
bring the benefits to the company. However, their mistakes were that they did not discuss
to understand the workers before deciding to receive these orders. In addition, the
supervisor also stated that production department did not forecast the effects of this
decision.
B/ LITERATURE REVIEW OF THE PROBLEMS
Reasons of High turnover rate
According to Smith 4, there are 12 reasons for employee turnover:
-

Rude behavior: everyday indignities have an negative influence on productivity
and result in good employees quitting.

-

Work-life imbalance (longer working hours or weekend work): when an
organization downsizes or restructures, it usually request employees for longer
working hours and weekend work. Then, employees have to choose between a
personal life and a work life.

-

The job did not meet expectations: it is too common when the initial description

of job and what was promised during the interview are different to the real work.

-

Employee misalignment: Organizations should never hire employees if they are
not qualified for the job and goals of the organization. Managers should not try to
force a fit when there is none.
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