Low engagement of production team in kimberly clark vietnam

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

PHAN THUY LOAN

LOW ENGAGEMENT OF
PRODUCTION TEAM IN KIMBERLY
CLARK VIETNAM
MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: DR. TRAN PHUONG THAO

Ho Chi Minh City – Year 2018


Table of Contents
List of acronyms .......................................................................................................................................... 2
List of Figures .............................................................................................................................................. 3
List of Tables ............................................................................................................................................... 3
CHAPTER 1: PROBLEM IDENTIFICATION ....................................................................................... 5
1.1

Industrial overview and Company overview ............................................................................ 5

Industrial overview ................................................................................................................................. 5
Company overview .................................................................................................................................. 6
1.2

Problem mess ............................................................................................................................... 7

1.2.1

Symptoms ................................................................................................................................. 7

1.2.2

Situation analysis ................................................................................................................... 10

1.2.3

Initial Cause-effect map ........................................................................................................ 14

1.3

Problem identification............................................................................................................... 18

1.3.1

Heavy workload ...................................................................................................................... 18

1.3.2

Ineffective recruitment process .............................................................................................. 19

1.3.3

Low employee engagement..................................................................................................... 20

1.3.4

Consequence .......................................................................................................................... 21

CHAPTER 2: SUGGESTED SOLUTION.............................................................................................. 26
2.1 Cause validation .............................................................................................................................. 26
Reward & Recognition ........................................................................................................................... 27
Development Opportunities .................................................................................................................... 28
Team Leader Relations .......................................................................................................................... 29
Pay........................................................................................................................................................... 29
2.2 Alternative solution ............................................................................................................................. 32
2.2.1

Apply evaluation process for the payment structure ......................................................... 33

2.2.2 Apply Market-based compensation system for the payment structure................................... 39
2.3 Action plan in an organization ........................................................................................................... 44
CHAPTER 3: SUPPORTING INFORMATION ................................................................................... 48
3.1 Methodology ........................................................................................................................................ 48
3.2 Interview transcript ............................................................................................................................ 48
References .................................................................................................................................................. 60

1


List of acronyms
KC: Kimberly Clark
KCV: Kimberly Clark Viet Nam
FMCG: Fast moving consumer goods
EHS: Environment, Health and Safety
IT: Information Technology
HR: Human Resource

OT: Ovetime
Fav: Favorite
Unfav: Unfavorite
KPIs: Key performance indicators
BD: Binh Duong
OP: production operator
Lead OP: Lead production operator
IDP: Individual development plan
ISO: International Organization for Standardization
JD: Job description
ETQ: Excellence through quality
JEC: Job Evaluation Committee
PR: Purchase requisition
PO: Purchase Order
JERF: Job Evaluation Review Form
C&B: Compensation and benefit
SAP: Systems, Applications and Products in Data Processing

2


List of Figures
Figure 1: FMCG growth nationwide in quarter 1/2018 (Source: Market Pulse Report Q1/2018Nielsen)..................................................................................................................................... 5
Figure 2: Structure of Kimberly Clark Viet Nam ............................................................................ 7
Figure 3: Number of leaving staff in person (Source: Human Resource Department) .................. 8
Figure 4: Number of leaving staff in percentage (Source: Human Resource Department)............ 9
Figure 5: Average Voluntary Attrition Rate 2016-2017 ............................................................... 10
Figure 6: Initial cause and effect map........................................................................................... 18
Figure 7: Number of leaving staff by experience (Source: Human Resource Department) ......... 20
Figure 8: Overtime reasons Jan-Jun 2018 (Source: Human resource department) ..................... 22

Figure 9: Performance of machines (first 6 months in 2018) ....................................................... 24
Figure 10: Waste of machines (first 6 months in 2018) ................................................................ 24
Figure 11: Updated cause and effect map..................................................................................... 25
Figure 12: The result of an employee engagement survey in 2017 ............................................... 26
Figure 13: Fish bone map ............................................................................................................. 31
Figure 14: Final map .................................................................................................................... 32
Figure 15: Market-based compensation process .......................................................................... 43
Figure 16: Summary of manager's perspective ............................................................................. 58
Figure 17: Summary of the leader's perspective ........................................................................... 58
Figure 18: Summary of employees’ perspective............................................................................ 58

List of Tables
Table 1: Voluntary/ Involuntary turnover ratio in 2016-2018 (first 6 months) ............................ 10
Table 2: Turnover ratio by department 2017-2018 (first 6 months) ............................................. 11
Table 3: Turnover ratio by position 2016-2018 (first 6 months) .................................................. 12
Table 4: Working experience at KC of leaving staff in 2016-2018 (first 6 months) ..................... 13
Table 5: Performance at KC of leaving staff 2017-2018 (first 6 months)..................................... 14
Table 6: Average Overtime per person Jan-Jun 2018 in percentage............................................ 22
Table 7: Hiring cost in 2018 (Source: Human resource department) .......................................... 23
Table 8: List of promotion of production (Source: Human Resource Department) ..................... 28
Table 9: summary of two solutions ................................................................................................ 44
3


EXECUTIVE SUMMARY

Human is an important asset in the organization in general and production operators are
the heart of manufacturing. Production operators are direct labor who participate in the
process to make product and account for more than 50 percentage headcount of the mill.
In 2018, the turn-over rate is increasing sharply and 85% falls into production team.

The high turnover rate in this group has a negative effect such as low skill workers, high
demand for training, high overtime payment and high hiring-cost which is around more
than 10 million VND each new comer. Attracting people is hard but retaining talent is
harder things. The turnover ratio or attrition rate is one of the most essential ratios to
show how the efficiency of manage people of the company. The higher turnover rate the
higher risk in the organization. The main purpose of the thesis is to explore the causes of
the high turnover rate of production operator in Kimberly Clark Viet Nam. The thesis
using theory-informed to group possible problem based on interviews and theoryconfirmed combined with depth-interview to figure out the main problem. The finding of
the thesis revealed that salary package is not attractive and it is one of factor of employee
engagement. The solution for this is “Apply Market-based compensation system for the
payment structure” to see that as if the salary for production team is competitive or not.

4


CHAPTER 1: PROBLEM IDENTIFICATION
1.1 Industrial overview and Company overview
Industrial overview
According to Market Pulse Report Survey quarter 1/2018 released by Nielsen Viet Nama global measurement and data company, fast moving consumer goods in traditional trade
drop down significantly to -1% and modern trade drop to 2.7%. (1).
According to the Recruitment market overview 2017 released by Faro- an international
staffing solutions company, manufacturing takes lead in recruitment with 82%. Retail &
FMCG (79%) and Tech & Telecom (73%) follow the lead (2). In addition, we should
understand the “vicious circle” of labor turnover. When turnover increase, it start circle
process include decreasing average length of service, entry standards are relaxed cause
deadline of recruitment, spending a lot of time to search candidates, losing a caring
current employee and they start to leave due to isolation from leader or manager and
turnover keep increasing (3).
Overall, the market is slowing down and FMCG companies jump to a fierce battle to gain
market share and high demand in recruitment will be one of the hard things for enterprises

in general for Kimberly Clark Viet Nam in specific.

Figure 1: FMCG growth nationwide in quarter 1/2018 (Source: Market Pulse Report Q1/2018-Nielsen)

5


Company overview
Kimberly Clark Corporation (KC) was established in 1872, the United State. Nowadays,
KC’s headquartered is in Texas, USA and are proud that nearly one-quarter of the
World’s population use our products every day. We have a number 1 or number 2
position in more than 80 countries and there are 175 countries where our leading brands
are sold. With the mission that is to create new value for our customers through products
and services of superior quality, and to contribute towards a better and more sustainable
world.
Kimberly Clark Viet Nam has established in 2000 with three distributions in South,
Middle of Viet Nam and North. From this, KC product can reach out to every family
through Viet Nam.
Consumer brands:
•

Feminine Care: Kotex. Kotex is one of the leading Vietnam brands within the
feminine hygiene category.

•

Baby child care: Huggies. Huggies nappies and related products are developed and
manufactured with the best quality.

Industry: Fast moving consumer goods industry

Competitors: The main competitor is Unicharm Company with Diana and Bobby branch.
Kimberly Clark Viet Nam structure
Kimberly Clark Viet Nam has two sites which are head office and mill. There are six
departments with more than 200 employees in head office such as Sales Department,
Finance Department, Marketing Department, Customer Supply Chain Department,
Procurement Department, and Human Resource + IT Department. There are five
departments with more than 400 employees in a mill such as the Production Department,
Engineering Department, Quality Department, Logistics Department and Environment,
Health and Safety (EHS) Department. Head office and Binh Duong mill have separately
key performance indicator. In this research, we only focus on the Binh Duong mill.

6


Sales Department
Finance Department
Marketing Department
Head office
Customer Supply Chain Department
Procurement Department
HR + IT

Kimberly Clark Viet Nam

Production Department
Engineering Department
Binh Duong
Mill

Quality Department

Logistics Department
EHS Department

Figure 2: Structure of Kimberly Clark Viet Nam
(Source: Human Resource Department)

1.2

Problem mess

1.2.1 Symptoms
In the year-end party which organized at Adora convention center (198 Hoang Van Thu
Street, Ward 9, Phu Nhuan District) in 1st December 2017, Mr. Praneeth Yendamuri,
Managing Director of KCV said in the opening of the party:
“In Vietnam, as one of the leaders in the categories we play in – over the years, Kimberly
Clark Viet Nam has ensured millions of babies are kept comfortable and thrive through
our Huggies brand and similarly millions of women are ensured of superior comfortable
protection for their feminine intimate care needs through our Kotex brand. Moreover, Viet
Nam has many competitive advantages and one of that is the workforce with high skill.
So that there is no reason to stop us to be the pride of Asia. Together, we will make it
comes true.”
To achieve that vision, KCV needs to focus on people, operation, and working
environment. And the most important thing is about human. Based on turnover data
provided by Tran Xuan Binh- Human Resource Manager in the weekly meeting which
organized with attendance of function head such as Production Department, Engineering
7


Department, Logistics Department, Quality Department at Binh Duong Mill every
Monday of March, he raised concern related to turnover rate keep going up and need

support from other head of department to talk with their team member to figure out
problem. Yet all managers did not set priority on that because they still have other key
performance indicators need to deliver. In the other hands, they might think that the trend
is always high after Tet is a normal thing. And the number is increasing next two month
raise big concern from Mill manager- Mr. Duong Minh Hoai. This is a big issue related to
the workforce. He stated in that meeting:
“The turnover rate is increasing sharply over months, especially in production. It impacts
strongly on the mill performance and we are losing talent. HR and all function heads need
to figure out reasons and take action as soon as possible to avoid impact to the business.”
According to data provided by the HR department at the end of June 2018, turn-over rate
has been increasing sharply in the quarter I of 2018 (Figure 3). It was nearly double the
number of last year from 16 to 30 persons resigned. The rate has a continuous increase in
the next quarter with 36 persons resigned and still higher than the same period last year.
The total leaving employees in 6 first month of 2018 is nearly equal to the amount of total
turnover number of 2017 (66/72). The number is unusual and need to be focused on by
the management team.

Leaving staff in number
40
35
30
25
20
15
10
5
0

36
30

21

24

16
11

quarter I

quarter II

2017 leaving staff (person)

quarter III

quarter IV

2018 leaving staff (person)
(first 6 months)

Figure 3: Number of leaving staff in person (Source: Human Resource Department)

8


The chart below (Figure 4) is about leaving staff in percentage. It makes data easier to
understand. The number of turnovers will be used to divide the total number of
employees which are 426 to get the percentage. The target of turnover rate in 2018 is 13%
but the number hits to 7% in the only quarter I 2018 and 8% in quarter II 2018. It means
the turnover target fails with 15% in June 2018. High turn-over will be a big problem of

human resources in efficiency. In the quarterly meeting, the management team requires to
find reasons and action plans to reduce the ratio of turn-over.

Leaving staf in percentage
10%

8%
7%

8%

5%

6%
4%

6%

4%
3%

2%
0%
quarter I

quarter II
2017 leaving staff (%)

quarter III

quarter IV

2018 leaving staff (%)
(first 6 months)

Figure 4: Number of leaving staff in percentage (Source: Human Resource Department)

To ensure that it is the issue happened in the company not the problem of the industry, it
necessary to compare data with numbers of consumer goods industry. Based on data from
2017 Asia Pacific Market Pulse Survey (Figure 5), the voluntary attrition rate of
consumer goods decreases from 17.1% (2016) to 12.8% (September 2017) while
Kimberly Clark Viet Nam 2017 attrition rate is 18% and 2018 attrition rate is 15% at the
end of June. It is too high compared with the number of the industry. Therefore, it is
possible to believe that a high turnover rate is an issue need to be solved.

9


Figure 5: Average Voluntary Attrition Rate 2016-2017
Source: 2017Asia Pacific Market Pulse Survey –Published in January 2018 (155 companies)

1.2.2 Situation analysis
To understand deeply about the turnover rate, it’s necessary to classify resignation to two
groups including “voluntary” and “involuntary”. Voluntary resignation is about
employees decide to leave the company by themselves to pursuit new opportunity or
because they do not want to stay with the organization for some reasons. This group needs
to be focused to figure out why turnover is high (4). In the other hands, In-voluntary
resignation is about company want to manage out someone who deliver low performance
or cannot meet the organization’s expectation. This group no need to retain. Voluntary/
Involuntary turnover ratio in 2016-2018 (first 6 months) table shows that the percentage

of In-voluntary group is negligible (Table 1). So that, the study will focus on the
Voluntary group to find factor impact on the high turnover rate.
Description

2017

2018

Involuntary

10

14%

4

6%

Voluntary

62

86%

62

94%

Total

72

66

Table 1: Voluntary/ Involuntary turnover ratio in 2016-2018 (first 6 months)
(Source: Human Resource Department)

With all the data above, we can see that the turnover increase dramatically but do not
know exactly which department. Therefore, the Turnover ratio by department 2017-2018
10


(first 6 months) data will show that where we should start to study (Table 2). The findings
are about the Production department with the highest percentage increase over the years.
Specifically, the number of turnover 2017 of production department is 57/72 persons who
resigned in total and account for 79% of total 2017; the number of turnover 2018 of
production department is 56/66 persons who resigned in total and account for 85% of total
2018. The turnover percentage of others is negligible.
Description

2017

2018

Engineering

1

1%

HR

1

1%

maintenance

3

4%

Mill general

1

1%

Planning

1

2%

2

3%

Procurement

1

1%

Production

57

79%

56

85%

Quality

5

7%

1

2%

2

3%

4

6%

Regional team
Warehouse

3

Total

72

4%

66

Table 2: Turnover ratio by department 2017-2018 (first 6 months)
(Source: Human Resource Department)

The study continues to deepen the data into positions in the production department. Based
on Turnover ratio by position 2017-2018 table (Table 3), we can see which position
contribute turnover rate of the department. Production department has many positions
which including direct labor and indirect labor. Direct labor includes Production Operator
and Lead Operator position. Indirect labor includes the rest of the positions on the list
(Table 3). There are 57 operators resigned in 2017 and 56 in the first 6 months of 2018.
Therein, the highest turnover group is a group of operators.

11


Description

2017

Production

Number of leaving

2018
(%)

the employee

Number of leaving

(%)

the employee

Asset Leader I

1

0.4%

Electrical Engineer

2

0.7%

Electrical Engineer II

1

0.4%

Lead OP

2

0.7%

Lead OP I

2

0.7%

operation manager

1

0.4%

Packing Technician

1

0.4%

Process Engineer

2

0.7%

44

15.9%

Electrical Technician

Machine Checker

Process Engineer I

1

0%

Process Engineer II

1

0%

Production Assistant

2

1%

Production Operator

53

19%

Total

57

56

Table 3: Turnover ratio by position 2016-2018 (first 6 months)
(Source: Human Resource Department)

Next, the study analysis turnover rate by service year and performance. The data shows
group by service year and performance to help clarify experience and capability of
resigned employees and management team will design schemes which is suitable for each
participant to attract and retain staff.
Performance rating includes four level as below:
o The exceptional group includes employees who have good behaviors and
deliver excellent performance. Moreover, they might be the successor to
their leaders. If the number of this group is high it will be a problem. From
the data below, there is 1 the case year 2017.
o The strong group includes employees who have good behaviors and deliver
good performance. The number of this group increased significantly in 2017
and keep increasing in 2018. This is a big issue with workforce planning.
12

o The inconsistent group includes employees who sometimes could not reach
any expectation of the target or behaviors, or both. The data of this group
increase over 2 years.
o Too new to rate group include newcomer who joined the company under 1
year. This group increased in 2017 and a decrease in 2018.
Based on Working experience at KC of leaving staff in 2016-2018 (first 6 months), the
number shows high turnover rate fall into strong performance group (Table 4). Employees
who have 1-3 experience years increase significantly in 2017 and continuously increase in
2018. An employee who has more than 3 experience year increase steadily over the year.
It means there is something change in mindset or expectation of strong performance
group lead to leave the company. The exceptional performance just has one case in 2017
so we can focus on it later (Table 5). For the inconsistent group, we no need to have
action because they cannot deliver target as company expectation so replacement is
needed. Therefore, the study will focus on strong performance group with more than 1year experience of working.
Service year

2017

2018

< 1 year

26

36%

11

17%

> 3 years

24

33%

28

42%

1-3 years

22

31%

27

41%

Total

72

66

Table 4: Working experience at KC of leaving staff in 2016-2018 (first 6 months)
(Source: Human Resource Department)

13


Performance

2017

2018

Exceptional

1

1%

Inconsistent

10

14%

16

24%

Strong

38

53%

43

65%

Too new to rate

23

32%

7

11%

Total

72

66

Table 5: Performance at KC of leaving staff 2017-2018 (first 6 months)
(Source: Human Resource Department)

Based on the date above, the study will focus on turnover of production operator group
who has strong performance and experience “1-3 years” more than 3 years.
1.2.3 Initial Cause-effect map
To ensure the information without bias, qualitative research is conducted by depthinterviews method not only for operation group but also for leader and manager level.
Therefore, whole matters will be set on the table to find the main problem. The

participants attend the interview include:
Manager role: Mr. Vu Minh- Production Manager
Leader role: Mr. Ha Van Dien- Asset Leader
Team member role- who leaved company: Mr. Bui Nhut Qui- Production Operator who
has worked 8 years, Mr. Pham Ngoc Tu- Production Operator who has worked 6 years,
Mr. Vo Huynh Quang Hung- Production Operator who has worked 1 year, Mr. Phan
Quoc Viet- Production Operator who has worked 3 years.
The unstructured interview guide (Appendix) is conducted to get more data to build Initial
cause and effect map.
From a manager’s perspective
Based on the interview with Mr. Vu Minh- Production manager (Appendix), the cause of
high turnover involve wrong project evaluation lead to low production performance as
well as market lead to low employee bonus. It effected on employee motivation. Then,
employee engagement is going down.
“Last year, Binh Duong mill received Dream project which is overwhelming to the team
and it fails to lead to low performance at the mill. Moreover, KC faced challenging from
14


a competitor so that our 2017 bonus result is not good. It may reason make turnover rate
too high this year”
Besides that, regional workforce strategy wants to minimize organization in the next few
years. This information makes employee worry and wants to look for new opportunities.
“This year still have many projects to run. Yet, regional workforce strategy is to keep
headcount and may reduce in the next several years. It affected the workload and stability
of work. It makes the employee feel worried and look for a new job.”
He explained more about employee naturally look for a new job when they have a low
bonus. He said:
“Operator thinks simple. Their nature behaviors will look for another job when they got a
lower bonus.”

The summary of the manager’s perspective is mentioned in figure 10 in chapter 3.
From a leader’s perspective
Based on an interview with Mr. Ha Van Dien- Asset Leader (Appendix) who is in charge
of managing the workforce and performance of the machine. Asset leader will manage 3
machines. Indeed, there is 20 employee who directly making product multiply with 3
machines equal to 60 employees under an Asset leader. He supposed high demand for
worker and quality of recruitment is one of the main problems. Therefore, their
adaptability is low and they easily quit a job to find a simpler job. Production operator in
Kimberly Clark is not only working as an operator but also maintenance staff to minimize
minor stop of the machine and maximize productivity. For the high demand worker from
the market, it is from an external element so that we just only review our compensation
program to ensure it interesting. On the other hand, the quality of recruitment is important
thing need to focus. Newcomer with low adaptability will give up daily obstacles and
leave very soon. It waste of time and money.
“I think because they have a good offer from another company. It is good for the
employee. But we have to look back as if our policy is reasonable. On the other hand, the
quality and adaptability of candidate recently are low. They easily quit the job. HR should
review source to get a higher quality candidate. KC employee worked under high
15


pressure of target such as time, waste, productivities, minor stop, time of change-over...
Therefore, newcomers will be hard to follow at the beginning.”
The summary of the leader’s perspective is mentioned in figure 11 in chapter 3.
From the employees’ perspective
Based on the interview with staff that leaving (Appendix), Mr. Vo Huynh Quang HungOperator, he said that he wants to get higher education and he gets a new job as an
engineer with daytime working. It will support his study schedule at the university.
Although his leader said that he will support him during Hung’s study time but he still
chooses to leave the company.
“My leader and colleagues told me that they ready to support me to study. They also told

me that there is some colleague still do that but after many days of thinking I still keep my
decision. I want to get a higher education and get a better job as an engineer.”
He also mentions the fluctuation demand of production lead to feeling stressful in a short
time. It will be great if the production plan spread out.
“Workload that I have is not too much but it is not allocated for a whole month. Some
weeks are over workload make me feel tired and some weeks are not busy like that.”
Based on the interview with staff that leaving (Appendix), Mr. Pham Ngoc Tu- Operator
level I, he mentioned about increasing allowance.
“…it should be more allowance. In other companies, basic wages general is not higher
than KC but there is more allowance. The benefit of KC is good for example insurance,
annual health check. Yet employee wants to receive a salary in money monthly more than
that.”
Additionally, he shared a good point about choosing a person to guide newcomer will
affect directly to engage them to stay with KC.
“The target is increasing year-by-year will make newcomers fell stressful. The current
employee with more experience at KC may be used to it. In my opinion, it takes time for
them to get acquainted with it. Besides that, Asset Leader and leader OP should have met
and chosen enthusiast Lead OP to take care of newcomer. In fact, there are some Lead

16


Ops do not have the enthusiasm to have, sometimes they scream newcomers and make
them hurt.”
Based on the interview with staff that leaving (Appendix), Mr. Bui Nhut Qui- Operator
level I, he talked about a new point which related to unclear promotion process. It is
redundancy.
“I have worked for 8 years at KC and got 1 promotion recently to operator level 1. I think
it is too long for the promotion. Recently, there is a lot of promthe otion for the operator
from level 0 to level 1 but they do not know the reason. I think it may come from the high

turnover rate.”
The summary of employees’ perspective is mentioned in figure 12 in chapter 3.
Based on all interview data from manager, leader and production employees, the study
consolidates information and merge all data to make Initial cause and effect map as
below. There are 6 causes-effect was found after depth interviews. Firstly, the low
performance of work leads to a low salary or allowance. Decreasing incomes make the
employee feel de-motivated and do not want to engage with the company anymore.
Secondly, employees do not understand clearly about performance evaluation. It makes
them feel unclear assessment process and this leads to low motivation and low
engagement. Thirdly, employees feel high pressure on their job because of two factors.
One is reducing headcount to the compact organization. The other one is a lot of change
over which is changing parts of the machine to run a new product line. The higher change
over the higher project. It means that the workload is heavy year by year. Fourthly,
newcomers had poor adaptability with the job. Leaders think that low quality of
candidates is a problem and a shortage of resource of candidates make ineffective
recruitment process. Fifthly, the employees who work in night shift hard to study if they
want to get higher education as their aspiration. Last but not least, Viet Nam workforce
has an advantage about low cost, a young population so that competition between local
and multinational companies is so intense. The employee may receive new opportunities
with higher salary from competitors or other companies. This external factor impacted
also high turnover rate.
17


Low engagement

Low motivation

Low allowance/
Salary

Reduce headcount
Over workload on job
Heavy workload

A lot of project

A lot of changeover

High turnover rate
Ineffective recruitement
process

Personal factor

Get higher education

External factor

Shortage resource of
candidates

Low quality of
candidates

Unsuitable for study

Nightshift work

Fierce compensation in

recruitment

New opportunities
with higher salary

Figure 6: Initial cause and effect map

1.3

Problem identification

Based on data collected from depth interviews, Initial cause and effect map was
developed. The thesis is focused on company problem not personal and external problem.
Therefore, the factors which include external and internal factors will be removed from
the study. Besides, it necessary to find theories or literature reviews to choose the main
problem.
1.3.1 Heavy workload
Firstly, the study will find theories to clarify heavy workload definition. As Brown
mentioned in his study, the workload can be understood that work is overload. It makes
people feel tired and cause of low productivity (5). According to Taylor, Repetti, and
Seeman (1997), workers who work overload for a long time will impact on their health.
There are some studies point out that work overload is the main factor of chronic
stress(6). Besides, there is a cause and effect relationship between heavy workload with a
job commitment. It is a negative impact on the engagement of actions (7). With the study
of Mueller, Boyer, Price, & Iverson in 1994, they show that heavy workload leads to
18


increase turnover rate (8). So heavy workload not only impact on productivity,
employee’s health, job commitment but also turnover rate. The theories show the

importance of heavy workload then we use collected data from the depth interview to find
out whether it is the main cause of high turnover rate or not. From the theories, the
varibale of “heavy workload” may be a main factor of the problem. Yet, we will compare
with data collected from exit interview to define as if it is a critical issue or not.
Based on data from interview Vo Huynh Quang Hung-1 experience year worker who left
the company, he does not feel overload in work. Yet he said that it is not spread out.
“Workload that I have is not too much but it is not allocated for a whole month. Some
weeks are over workload make me feel tired and some weeks are not busy like that.”
From data from interview an experienced worker- Pham Ngoc Tu, he said that he was
used to it. There is nothing make him frustrated at work.
“I had worked at KC for 6 years so that I felt ok with the workload. It is not too much
with me but it might be difficult for newcomer”
Based on data form theories, heavy workload is factor let employee down and feel tired.
Therefore lead them to quit the job. With all information which collected form exit
interview, the resigned employees think that there is heavy workload sometime but it not
the key factor push them to looking for new job. It also means that heavy workload is not
the main cause lead to high turn over rate.
1.3.2 Ineffective recruitment process
Secondly, we continue to find the definition of the ineffective recruitment process from
other literature reviews. The recruitment process is an important part of human resource
management which is mentioned in the Human Resource Management book. Human
resource management includes talent acquisition, training development, assessment, and
reward (10). Having a good recruitment process, it will an important part to find a good
person for the right job. As Taylor mentioned in “Organizational recruitment activities
and applicants' reactions at different stages of the recruitment process” study, the
recruitment process includes many activities in it to attract talent for the organization (11).
According to Heneman, Schwab, Fossum, & Dyer study, this process includes seeking
19

talent from many resources and show them good compensation and benefits package to
attract them to join the company (12). The recruitment process can call in the other name
which is “talent acquisition”. When doing good talent acquisition the productivity will
increase also (13).
With all data above, the thing that not doing good recruitment process will have a
negative impact on workforce and talent pool. Then, this study will compare with data
from the company to define whether it is the main cause or not. Based on “Leaving staff
by experience” data (Figure 6) provided by Human Resource in 2017 and first six months
in 2018. The number of leaving staff who has under 1 pear experience at Kimberly Clark
is going down. The number for this is 6 newcomers in the first 6 months in 2018. It shows
that the quality of the recruitment process is not the main problem of turn over. Moreover,
the highest turnover rate falls into the group who has strong performance it strongly
supports that the recruitment process is not the main cause which should focus on.

leaving staff by experience
25
18

20

20

20

22

16

15

10
5

6
1

8

2

4

6

2017

6

4 3

1 1

2018

0
1-3 years
Exceptional

< 1 year

> 3 years

1-3 years

Inconsistent

< 1 year

> 3 years
Strong

1-3 years

< 1 year

1-3 years

Too new to rate

Figure 7: Number of leaving staff by experience (Source: Human Resource Department)

1.3.3 Low employee engagement
Lastly, this study will find the definition of low employee engagement from other studies
to compare with actual data to figure out whether it is the main problem. Based on Bakker
study, employee engagement is the thing that employees uses their energy including a
physical, emotional and mental focus on their role to deliver the highest result. It is the
way to express the one also (14). The other definition of employee engagement by
Andrew OC, Sofian S shows that employee engagement is an essential part of the
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organization. It helps to build a strong foundation of the organization. An employee who
works with passion will contribute their full potential to get a higher level of performance
(15). In Bakker study (2008), he an agreed that employee with higher energy will deliver
the better result (16). With all definition above, the employee engagement is a crucial part
in the development journey of the company.
In addition, The Initial cause and effect map which merge data from the interview
employees, leader and manager also shows low employee engagement is a problem of
organization.
From a manager’s perspective, Mr. Vu Minh- Production Manager think that low bonus
will lead to low motivation and loyalty of employee.
From a leader’s perspective, Mr. Ha Van Dien- Asset Leader think that uncompetitive
compensation package makes employee demotivate lead to low engagement.
From the employees’ perspective, they think that uncompetitive allowance and salary
make them leave the company.
With all the information above, employee engagement is very important in the company.
The higher engagement scores the higher loyalty and they will deliver high performance.
1.3.4 Consequence
To strengthen the important of the main problem, the study will show the possible result
when the company has low engagement score. High turn-over will increase costs which
include overtime payment and hiring cost. It takes time for newcomers to learn and adopt
new environment and might a reason for low performance. A newcomer needs at least
three months to do smoothly their daily work. Newcomers need to be trained by current
employees and they have to work overtime to teach new hires. This lead to increase high
overtime payment. Besides that, when lacking resource the rest of the team have to work
overtime to cover the workload of the vacancy. Therefore, it is necessary to find the main
problem of high turnover to minimize waste of money.
According to Figure 7 below, the highest overtime payment paid for replacing equivalent
to 8 hours per person per month. The percentage of overtime payment for replacing is
20% (Table 6) which is equal to 5,881,886 VND (Table 7) per new hire monthly. On the

21


other hand, the related cost for newcomers will be waste if they just join the company for
a few months and quit. The total amount maybe estimates around 10,687,108 VND. Then,
the amount the company had paid for 66 resignation cases is around 705,349,128 VND
for the first 6 months. In case there is no one leave company at least one year, it will be
investment costly. Yet if there is any newcomer quit the job, it will be waste of time and
money. Then, the whole recruitment process needs to be restarted with a double cost.

Overtime reasons Jan-Jun 2018
meeting

3

OT reasons

kaizen/problem solving

4

training

6

supporting

7

project

7

others

7

replace people

8
0

1

2

3

4

5

6

7

8

9

OT hours/month

Figure 8: Overtime reasons Jan-Jun 2018 (Source: Human resource department)
Ave OT/person (Jan-Jun/2018)

Hours/month

%

Replace people

8

20%

Others

7

17%

Project

7

17%

Supporting

7

16%

Training

6

14%

Kaizen/Problem solving

4

9%

Meeting

3

8%

Total

42hrs

100%

OT/month/person
Table 6: Average Overtime per person Jan-Jun 2018 in percentage
(Source: Human resource Department)

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Description

Cost

Personal protection equipment

2,803,000

recruiting fee

2,002,222

OT payment

5,881,886

Total cost/new hires

10,687,108

Table 7: Hiring cost in 2018 (Source: Human resource department)

It’s not only cost of time to recruit but also cost of building talent and retain staff.
Especially, operators who are directly involved in the production process, New operator
need three to six months to understand and operate smoothly. It means that there is the
amount of money need to be paid for training and overtime of current experience

employee to take care of the new one during that time. If newcomers pass probation time
and keep delivering good performance, it is still a good investment with long term.
Lacking operator resource will decrease productivity and increasing waste. When
turnover is high means that lacking human resource with experience. The new comers
need a lot of time to adapt and understand the process and how to do problem solving.
The current employees not only try to cover the workload of the vacancies but also train
new comers as fast as possible. Then, they can do their job smoothly. Figure 8 and 9 show
that the performance of machines are not meet the target for the first 6 months in 2018
and the waste is higher than the target of 2018. The year to date for OEE is 88.4% versus
target is 90.3%. Moreover, the Waste year to date is 1.2% versus target 0.71%. Thus, the
Binh Duong mill will not meet performance at the end of the year and directly impact to
profit and bonus in the end of the year of whole company.

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Performance of machines
92.00%
91.00%
90.00%

89.77%

89.00%

90.30%
89.3%

88.4%

89.2%
88.0%

88.00%

88.4%

88.0%
87.3%

87.00%
86.00%
2017
YTD

2018 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 2018
Target
YTD

Figure 9: Performance of machines (first 6 months in 2018)
(Source: Kimberly Clark mid-year business review 2018)

Waste of machines
2.00%
1.43% 1.41% 1.35% 1.39%

1.2%

2018 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18
Target

2018
YTD

1.50%
1.00%

1.26%
0.73% 0.71% 0.64%

0.50%
0.00%
2017
YTD

Figure 10: Waste of machines (first 6 months in 2018)
(Source: Kimberly Clark mid-year business review 2018)

In the weekly meeting at Binh Duong mill, Mill manager said among the board of
management: “engagement activities are going down recently and it is not interesting
anymore. We have to face huge competition in the market so there is a lot of projects
developed to win market shares. It is necessary to make the engagement program more
interesting.” Human Resource Manager agreed with Mr. Hoai in the same meeting:
engagement is one of the important things need to focus to retain talent.
With all data given above, both un-control factors which are external and personal factor
will be eliminated because the company cannot control them. It should be focused on
what the company can changes which are the process of recruitment, reviewing workload
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