Sự hài lòng của nhân viên tại công ty TNHH bảo hiểm nhân thọ aviva việt nam

ĐẠI HỌC QUỐC GIA HÀ NỘI
KHOA QUẢN TRỊ VÀ KINH DOANH
---------------------

NGUYỄN QUỲNH MAI

STAFF SATISFACTION
AT AVIVA VIETNAM LIFE INSURANCE
COMPANY LIMITED

SỰ HÀI LÒNG CỦA NHÂN VIÊN
TẠI CÔNG TY TNHH BẢO HIỂM NHÂN THỌ
AVIVA VIỆT NAM

LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

HÀ NỘI - 2020


ĐẠI HỌC QUỐC GIA HÀ NỘI
KHOA QUẢN TRỊ VÀ KINH DOANH
---------------------

NGUYỄN QUỲNH MAI

STAFF SATISFACTION
AT AVIVA VIETNAM LIFE INSURANCE
COMPANY LIMITED

SỰ HÀI LÒNG CỦA NHÂN VIÊN
TẠI CÔNG TY TNHH BẢO HIỂM NHÂN THỌ

AVIVA VIỆT NAM

Chuyên ngành: Quản trị kinh doanh
Mã số: 60 34 01 02
LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

NGƯỜI HƯỚNG DẪN KHOA HỌC: TS. TRẦN HUY PHƯƠNG

HÀ NỘI - 2020


DECLARATION
The author confirms that the research outcome in the thesis is the result of author‟s
independent work during study and research period and it is not yet published in other‟s
research and article.
The other‟s research result and documentation (extraction, table, figure, formula, and
other document) used in the thesis are cited properly and the permission (if required) is given.
The author is responsible in front of the Thesis Assessment Committee, Hanoi School
of Business and Management, and the laws for above-mentioned declaration.
Date…………………………..


ACKNOWLEDGEMENT

Foremost, I would like to express my sincere gratitude to my supervisor Dr.
Tran Huy Phuong for his continuous support of completing my research, for his
patience, motivation, enthusiasm, and immense knowledge. His guidance helped me
in all the time of research and writing of this thesis.
Besides my supervisor, I would like to thank the staffs and managers of
Aviva Vietnam Life Insurance Company Limited who provided me insight and

expertise that greatly assisted the research and shared with me a lot of useful
information as well as opinion in relation to Aviva Company‟s business operation,
human resources and performance.
I would like to extend my sincere thanks to the staffs of Aviva Vietnam Life
Insurance Company Limited who spent their time on completing my long
questionnaire and be patient to correct or satisfy my questions.
Last but not the least, I would like to thank my family for supporting me
spiritually throughout my life and encouraging me to complete the thesis.

<…………, ………/………/……… >
Nguyen Quynh Mai


CONTENT

INTRODUCTION ................................................................................................................. 1
1. Rationale ........................................................................................................................ 1
2. Literature review............................................................................................................ 2
3. Aims of research ............................................................................................................ 4
4. Objects of research ........................................................................................................ 5
5. Scope of research ........................................................................................................... 5
6. Research methodology .................................................................................................. 5
7. Thesis structure .............................................................................................................. 7
CHAPTER 1. THEORETICAL BACKGROUND ON STAFF SATISFACTION IN
ENTERPRISES ..................................................................................................................... 8
1.1. Theoretical background on staff satisfaction .............................................................. 8
1.1.1. Staff satisfaction .................................................................................................. 8
1.1.2 Theory of staff satisfaction ................................................................................... 9
1.2. Factors affecting on staff satisfaction ....................................................................... 20
1.2.1. Job characteristics .............................................................................................. 20

1.2.2. Training and promotion ..................................................................................... 20
1.2.3. Leadership ......................................................................................................... 21
1.2.4. Colleagues ......................................................................................................... 22
1.2.5. Salary/ income ................................................................................................... 22
1.2.6. Working condition ............................................................................................. 25
1.2.7. Welfare .............................................................................................................. 26
1.3. Research model......................................................................................................... 26
CHAPTER 2. ASSESSING CURRENT STAFF SATISFACTION AT AVIVA VIETNAM
LIFE INSURANCE COMPANY LIMITED ...................................................................... 30
2.1. Overview about Aviva Vietnam Life Insurance Company Limited......................... 30


2.1.1. Establishment and development ........................................................................ 30
2.1.2. Organizational structure of Aviva Vietnam Life Insurance Company Limited 30
2.1.3. Business results of Aviva Vietnam Life Insurance Company Limited in the
period of 2016-2018 .................................................................................................... 32
2.2. Overview of human resources of Aviva Vietnam Life Insurance Company Limited
......................................................................................................................................... 34
2.2.1. Statistics of human resources of Aviva Vietnam Life Insurance Company
Limited ........................................................................................................................ 34
2.2.2. Labor structure by age ....................................................................................... 36
2.2.3. Labor structure by gender .................................................................................. 37
2.2.4. Labor structure by education ............................................................................. 37
2.3. Factors affecting staff satisfaction at Aviva Vietnam Life Insurance Company
Limited ............................................................................................................................ 38
2.3.1. Job characteristics .............................................................................................. 41
2.3.2. Training and promotion ..................................................................................... 43
2.3.3. Leader ................................................................................................................ 47
2.3.4. Colleague ........................................................................................................... 49
2.3.5. Salary/ income ................................................................................................... 50

2.3.6. Working condition ............................................................................................. 57
2.3.7. Welfare .............................................................................................................. 61
2.4. Overall assessment about staff satisfaction at Aviva Vietnam Life Insurance
Company Limited ............................................................................................................ 65
2.4.1. Achievements .................................................................................................... 65
2.4.2. Limitations ......................................................................................................... 66
2.4.3. Causes of limitations ......................................................................................... 68
CHAPTER 3. PROPOSAL ON SOLUTIONS TO IMPROVE STAFF SATISFACTION
AT AVIVA VIETNAM LIFE INSURANCE COMPANY LIMITED ............................... 69
3.1. Orientation and general targets at Aviva Vietnam Life Insurance Company Limited
......................................................................................................................................... 69


3.2. Orientation and general targets of staff satisfaction at Aviva Vietnam Life Insurance
Company Limited ............................................................................................................ 70
3.3. Some solutions to improve staff satisfaction at Aviva Vietnam Life Insurance
Company Limited ............................................................................................................ 70
3.2.1. Improving salary and bonus for employees ....................................................... 70
3.2.2. Supplementing welfare ...................................................................................... 72
3.3.3. Innovating training and promotion for employees ............................................ 73
3.2.4. Increasing recognition of employees‟ achievements ......................................... 78
3.2.5. Improving the environment and working conditions ........................................ 80
3.2.6. Improving the layout and arrangement of work for employees ........................ 81
CONCLUSION ................................................................................................................... 84
REFERENCES .................................................................................................................... 85
APPENDIX ......................................................................................................................... 89


LIST OF ABBREVIATIONS

CEO

Chief Executive Officer

JDI

Job Descriptive Index

HR

Human Resources

NPL

Non-performing Loan

VND

Vietnam Dong


LIST OF TABLES
Table 2.1: Business result of Aviva Vietnam from 2016-2018 ........................................... 33
Table 2.2: Labor structure by age of Aviva Vietnam in 2018 ............................................. 36
Table 2.3: Labor structure by gender of Aviva Vietnam in 2018 ....................................... 37
Table 2.4: Labor structure by education of Aviva Vietnam in 2018 ................................... 38
Table 2.5: Job evaluation table of Aviva Vietnam .............................................................. 54
Table 2.6: Salary table of positions for administrative and sales staff at Aviva Vietnam .. 55
Table 2.7: Welfare regulations of Aviva Vietnam .............................................................. 64
Table 2.8: Plan for organizing collective exchanges and vacation trips of Aviva Vietnam 65

LIST OF FIGURES
Figure 1.1: Maslow's Needs Theory (1943) ........................................................................ 10
Figure 1.2: Victor Vroom's theory of expectations (1964).................................................. 14
Figure 1.3: Proposed model to measure staff satisfaction at Aviva Vietnam Life Insurance
Company Limited ................................................................................................................ 27
Figure 2.1: Organizational structure of Aviva Vietnam ...................................................... 31
Figure 2.2: Statistics of human resources of Aviva Vietnam from 2016-2018 ................... 35
Figure 2.3: Gender structure of Aviva Vietnam‟s respondents ........................................... 39
Figure 2.4: Age structure of Aviva Vietnam‟s respondents ................................................ 39
Figure 2.5: Education structure of Aviva Vietnam‟s respondents....................................... 40
Figure 2.6: Department/division structure of Aviva Vietnam‟s respondents ...................... 40
Figure 2.7: Seniority structure of Aviva Vietnam‟s respondents ........................................ 41
Figure 2.8: Staff satisfaction about job characteristics at Aviva Vietnam .......................... 42
Figure 2.9: Staff satisfaction about training and promotion at Aviva Vietnam .................. 43
Figure 2.10: Staff satisfaction about leader at Aviva Vietnam ........................................... 48
Figure 2.11: Staff satisfaction about colleague at Aviva Vietnam ...................................... 49
Figure 2.12: Staff satisfaction about salary/income at Aviva Vietnam ............................... 51
Figure 2.13: Staff satisfaction about working condition at Aviva Vietnam ........................ 58
Figure 2.14: Office of Aviva Vietnam in Ho Chi Minh headquarters ................................. 60
Figure 2.15: Office of Aviva Vietnam in Hanoi headquarters ............................................ 61
Figure 2.16: Staff satisfaction about welfare at Aviva Vietnam ......................................... 62


INTRODUCTION
1. Rationale
Human resources are an important factor for an organization's success. The job
satisfaction of employees helps them to work hard to contribute to the company. Job
satisfaction measurement is aimed at determining the factors impacting employee

satisfaction most; thereby helping the company better understand the level of employee
satisfaction. Accordingly, there are more accurate decisions to improve the working
environment, use the right people in the right jobs, exploit human resources in the
company and bring the highest satisfaction to employees.
The market economy is increasingly developing and opening up many job
opportunities for employees. The competition among businesses is getting higher and
higher, but people are an important resource in creating competitive advantages for
businesses. The pressures from the economy and competitive market force businesses to
pay more attention to the human element in the organization, including the problem of
employee satisfaction. Today's business trend most businesses take customers as business
philosophy. And the component in direct contact with customers, making customers happy
is none other than employees. The main staff is intermediaries for businesses to satisfy
customers. When employees are satisfied they will have positive attitudes and behaviors to
improve sales and build business reputation.
For businesses, in the period of economic integration, increasingly fierce
competition, human resources play an important role in creating competitive advantages.
Especially for businesses that are on the rise, seeking and asserting a foothold in the market
as Aviva Vietnam Life Insurance Company Limited now needs to pay attention to
employee satisfaction. Promoting the development of the Company today, it is very helpful
to evaluate the employee's job satisfaction with the company.
This research can make initial data, as a benchmark for comparison in the process
of development of the company in the future, will increase employee satisfaction? This is
the first step for the organization to increase employee loyalty towards the company.
Therefore, the topic "Staff satisfaction at Aviva Vietnam Life Insurance Company
Limited" is conducted to understand and evaluate the current status of job satisfaction
including full-time and part-time employees at Aviva Vietnam Life Insurance Company
Limited, and find out the factors that influence this satisfaction; thereby helping businesses
have the appropriate orientation, policies in the use of employees, in order to retain
appropriate employees, long-term commitment to the company.
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2. Literature review
Research of Foreman Facts: Following the approach of Foreman Facts (1946),
employee satisfaction is related to ten factors: (1) Skillful discipline, (2) Empathy for
individual workers' issues, (3) Interesting work, (4) Interacting and sharing at work, (5)
Safety labor, (6) Working conditions, (7) Salary, (8) Fully assessed work performed, (9)
Personal loyalty to superiors, (10) Promotion and promotion career development.
Research by Weiss, Dawis, England & Lofquist Weiss, Dawis, England & Lofquist
(1967) built a MSQ (Minnesota Satisfaction Questionnaire) model with 20 items
(corresponding to 20 factors) to assess the overall satisfaction level of each aspects: (1)
Usability (the opportunity to do something to promote the capabilities of workers); (2)
Achievements (a feeling of good accomplishment that workers gain from work); (3)
Activity (ability to maintain busyness most of the time); (4) Promotion (promotion
opportunity in this job); (5) Rights (opportunity to tell others what to do); (6) Company
policy (the way the company sets policies and puts them into practice); (7) Compensation
(wages and large amounts of work done); (8) Colleagues (the way colleagues show off to
others); (9) Creativity (an opportunity to try each person's methods on his work); (10)
Independence (the opportunity to work alone at work); (11) Safety (job stability); (12)
Social services (opportunity to do things for others); (13) Social position (opportunity to
become "someone" in the community); (14) Moral value (can do things that are not
contrary to conscience); (15) Recognition (recognition of good work); (16) Responsibility
(the freedom to use your opinion); (17) Supervision - the person (the way the leader
operates the employee); (18) Supervision - technology (leadership decision-making); (19)
Diversity (opportunity to do different things); (20) Working conditions.
Smith et al's research: The JDI job description scale established by Smith et al in
1969 is one of the most valuable and reliable scales in theory and practice. This scale
consists of five factors: (1) The nature of the job, (2) Opportunity for promotion training,
(3) Leadership, (4) Colleagues, (5) Salary. Later, Crossman and Bassem (2003) added two
more components, namely welfare and the working environment.

Schemerhon's research: With his research, Schemerhon (1993) gave eight factors
that affect employee satisfaction, including: (1) Job position, (2) Supervision by superiors,
(3) Relationship with colleagues, (4) Content of work, (5) Remuneration, (6)
Advancement, (7) Physical conditions of the working environment, (8) Organizational
structure

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Spector's research: The Spector's JSS (Job Satisfaction Survey) model (1997) was
built to apply to businesses in the service sector, including nine factors to evaluate
satisfaction and attitude, that are: (1) Salary, (2) Opportunity for promotion, (3) Working
conditions, (4) Supervision, (5) Colleagues, (6) Interested in work, (7) Communication
believe, (8) Surprise rewards, (9) Welfare.
Research by Nasir Mehmood et al. (2012): Mehmood et al. (2012) conducted a
study on factors affecting job satisfaction of employees in service industry in Pakistan with
a sample of 324. The independent variables selected are: Wages and benefits, Promotions,
Working conditions, Autonomy. Statistical results show that independent variables such as
wages and benefits, promotions, working conditions and autonomy affect employees' job
satisfaction. In measurement, working environment factors predominate in job satisfaction.
Research by Ethica Taijeen (2013): Ethica Taijeen (2013) studied factors affecting
the job satisfaction of telecommunication industry in Bangladesh. The research model of
employee satisfaction at work includes factors: working conditions, freedom or autonomy,
job security, relationship with superiors, relationship with colleagues, salary, opportunities
for career advancement. The results show that, in general, the factors leading to the highest
satisfaction are working conditions, job security, relationships with colleagues and wages.
The factors that lead to the lowest satisfaction are freedom, relationships with superiors
and advancement.
The study "Research on employee satisfaction level for jobs at Vietnam - Korea
Friendship Information Technology College" was conducted by Nguyen Thanh Hoai in

2013. The objective of this study is to identify 6 factors that affect employee satisfaction,
maintain the team and contribute to the overall development of the school.
Research "Research on job satisfaction of employees of Vietnam Tourism Joint
Stock Company - Vitours Danang" was conducted by Phan Hoang Thuy in 2013. The
objective of this study is to identify the factors that influence on the job satisfaction of
employees of Vitours Company - Da Nang; develop and validate a scale of factors to suit
the company's context; measure the influence of impact factors; compare job satisfaction
among employees with differences in gender, age, working time, education level, job
position ...
The study "Research on employee satisfaction level at Hai Duong Power
Company" was conducted by Pham Tuan Ngoc in 2013. The objective of this study is to
identify factors that affect the satisfaction of employees with the work of Hai Duong Power
Company staff and assess the employee satisfaction level. The author used JDI model to
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design questionnaires and collect and analyze data in this study. The study results showed
5 factors affecting employees' job satisfaction: job; promotion opportunities; leader;
colleague; salary.
Weiss and his colleagues' model and Foreman Facts are more detailed, but the
weakness is too long. Schemerhon and Spector have proposed tidier models, but if
applying the research, it needs to be adjusted accordingly. Although Smith et al's JDI
model did not cover all factors that affect satisfaction and there is no overall scale, based
on this model, there have been many studies for the evaluated high results in value and
reliability. Later, when Crossman and Bassem added two more factors made the model
more complete.
In Vietnam, the JDI model is also used by many authors as the basis for employee
satisfaction research, such as Tran Thi Kim Dung (2005) and colleagues by surveying
about 500 employees working full-time under the theme "Needs, satisfaction of employees
and level of engagement with the organization", using a scale of seven factors showing: the

satisfaction level of salary with negative relationship with the level of effort of the staff.
This paradox is explained by businesses lacking knowledge and skills on the market salary
system, not knowing how to design a system of payrolls scientifically. The salary payment
is usually emotional and arbitrary without clear policy. As a result, people with more
efforts and contribution to the organization are dissatisfied with the current wage policy.
Vu Khac Dat (2009) measured the satisfaction of office workers of Vietnam Southern
Airlines using a six-factor scale; Nguyen Tran Thanh Binh (2009) conducted a study on
employee satisfaction at Long An Mechanical Engineering Joint Stock Company using a
six-factor scale.
In addition, a number of studies of the above authors have shown that employee
satisfaction at work differs due to personal factors such as age, gender, education level,
seniority, position, department and income.
3. Aims of research
The final research aim is to recommend and improve staff satisfaction at Aviva
Vietnam Life Insurance Company Limited.
To address the above research objective, the research focuses on clarifying the
following duties:
-

Systematizing the theoretical basis of staff satisfaction in enterprises;

-

Analyzing and evaluating the current staff satisfaction at Aviva Vietnam Life
Insurance Company Limited in the period of 2016-2018;
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Proposing solutions to enhance staff satisfaction at Aviva Vietnam Life Insurance
Company Limited in the coming time.

4. Objects of research
Research object: The thesis focuses on measuring staff satisfaction at Aviva
Vietnam Life Insurance Company Limited.
Object: 200 employees at Aviva Vietnam Life Insurance Company Limited.
5. Scope of research
+ Space: Aviva Vietnam Life Insurance Company Limited.
+ Time: The thesis analyzes the current staff satisfaction at Aviva Vietnam Life
Insurance Company Limited in the period of 2016-2018 and proposes the
recommendations up to 2025.
+ Content: The staff satisfaction at Aviva Vietnam Life Insurance Company
Limited.
6. Research methodology
* Data collection method:
- Secondary data
Secondary data are data widely researched and published in books, newspapers,
magazines, Internet, etc. These data are used for analysis and clear illustration of research
content that the author has studied. These secondary data are cited by the author in the
"References" section. Specifically, secondary data the author collected in this study
include:
+ Books, newspapers, magazines, theses, theses, research programs have been
published and published by research agencies, domestic and foreign scientists, documents
posted on the Internet,. .. related to staff satisfaction.
+ Figures, data and reports related to the personnel situation; business operation
results; development directions and objectives; policies, remuneration, recruitment, ... of
Aviva Vietnam.
+ Circulars, directives and decisions of the Government and the competent
authorities of the State; The figures have been published by central statistics agencies,
research institutes, universities, journals, specialized newspapers and scientific reports
related to staff satisfaction.
- Primary data

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For primary data, this is the type of data collected by the questionnaire through
face-to-face interviews and is used to conduct the necessary analysis to answer research
questions.
+ Content of survey: Satisfaction of employees at Aviva Vietnam.
+ Survey subjects: Officials and employees working at Aviva Vietnam.
+ Quantity: 200.
+ Duration: 01 month, from October 1, 2019 - October 1, 2019.
+ Survey form: Currently, the author is an employee of Aviva Vietnam. Therefore,
the author chooses the form of direct and email survey. Survey respondents who can
answer directly in the questionnaire are directly instructed by the author to fill out the
survey information. Officers and staff are busy, unable to answer directly, the author sends
emails by completing the questionnaire. For these officials and employees, after one week
after sending emails, the author sends emails, Zalo messages, phone messages or calls
reminds them to take time to complete the questionnaire.
* Questionnaire design
+ Part I: The questionnaire is made on the basis of the selected scale and group
discussion on employee satisfaction with the job. The content and observed variables in the
components are adjusted accordingly. A 5-point Likert scale used to rank from small to
large is more agreeing with the statement (1. Completely dissatisfied; 2. Dissatisfies; 3.
Neutral; 4. Satisfied; 5. Completely satisfied).
The mean score follows the following scales:
1.00-1.80: Completely dissatisfied
1.81-2.60: Dissatisfied
2.61-3.40: Neutral
3.41-4.20: Satisfied
4.21-5.00: Completely disatisfied

+ Part II: Personal information to classify interview subjects such as gender, age,
working time at hotel, working department, level, current income.
* Data processing methods
After 01 month, the author collected 190/200 questionnaires, of which 190 were
valid, reaching 95%. 190 is the final data used by the author throughout this study.
For secondary and primary data collected, the author used methods of comparison,
analysis, synthesis to process and clarify these data. Inside:

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The comparison method is used to compare the current situation of Aviva
Vietnam's staff satisfaction with other units in the same field; thereby, we learned the
strengths and limitations of the remuneration and regimes for employees of Aviva
Vietnam.
Methods of analysis and synthesis: After collecting the data, the author proceeds to
process and analyze to clarify the necessary attributes such as information of the survey
subjects (age, gender, time workspaces, departments, ...) and the answers obtained. After
analysis, the author synthesized into a system to have the most comprehensive and
objective view of the meanings behind those numbers and data; thereby, helping the author
analyze the current staff satisfaction.
In addition, with the research issues in the thesis, the author also seeks to break
down the research content to be able to carefully analyze each content, thereby better
understanding their nature, advantages and limitations. Then, the author generalized the
issues to get the most complete and general understanding of the results collected.
7. Thesis structure
In addition to Introduction, Conclusion and List of references, the thesis includes
03 chapters as follows:
Chapter 1: Theoretical background on staff satisfaction in enterprises
Chapter 2: Assessing current staff satisfaction at Aviva Vietnam Life Insurance

Company Limited
Chapter 3: Proposal on solutions to improve staff satisfaction at Aviva Vietnam
Life Insurance Company Limited.

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CHAPTER 1. THEORETICAL BACKGROUND ON STAFF SATISFACTION IN
ENTERPRISES
1.1. Theoretical background on staff satisfaction
1.1.1. Staff satisfaction
1.1.1.1. Definition
Staff satisfaction is a unified concept of researchers stemming from different
perspectives, different research fields. Kusku (2003) argues that staff satisfaction reflects
individual needs and desires and the level of employees' perceptions of their work. This
definition is derived from Maslow's demand scale theory (1943), which states that
employees are satisfied with low to high demand. Wright and Kim (2004) also suggested
that staff satisfaction is the match between what employees expect from work and what
they feel from work. Some other researchers think that staff satisfaction is a positive
emotional state of workers with jobs that show their behaviors and beliefs (Vroom, 1964;
Locke, 1976; Quinn and Staines, 1979; Weiss et al, 1967).
Ellickson and Logsdon (2002) suggest that staff satisfaction is the degree to which
employees like their jobs, which are attitudes based on employees' perceptions (positive or
negative) of work or their working environment.
According to Quinn & Staines (1979), staff satisfaction is a positive response to
work.
According to Kreitner & Kinicki (2007), staff satisfaction mainly reflects the level
of an individual who loves his or her job, which is the employee‟s emotions or feelings for
the job.
Luddy (2005) argued that staff satisfaction is an emotional response to different

aspects of work. Luddy emphasized the causes of job satisfaction including job position,
supervision of superiors, relationship with colleagues, job content, remuneration and
rewards including: advancement, the physical condition of the working environment and
organizational structure.
Some other researchers claim that staff satisfaction is satisfaction with different job
aspects. The level of job satisfaction with employees affects employee attitudes and
perceptions, typically Smith et al. (JDI) study (1969 cited by Luddy, 2005). In the study of
Smith et al, staff satisfaction is expressed through five main groups of factors: (1) job, (2)
promotion opportunities, (3) leadership, (4) colleagues and (5) salary/income. The
consideration of satisfaction in many aspects of Smith's work is also recognized by many
other researchers in different studies (Spector, 1997; Tran Kim Dung, 2005; Luddy, 2005).
8


According to Smith, Kendal and Hulin (1969), the level of satisfaction with the
components or aspects of a job is the attitude that influences and acknowledges employees'
different aspects of work (nature of work, training and advancement opportunities,
leadership, colleagues and salaries).
There are generally two trends that define staff satisfaction (1) considering staff
satisfaction as a general variable of the emotional nature (positive and negative) of workers
to work that may affect to the beliefs and behaviors of workers; (2) considering staff
satisfaction under various job aspects. In this study, staff satisfaction is considered under
both aspects of job and overall staff satisfaction with work in general.
In this research, staff satisfaction is understood as definitions by Smith, Kendal and
Hulin (1969). Accordingly, staff satisfaction is “the attitude that influences and
acknowledges employees' different aspects of work (nature of work, training and
advancement opportunities, leadership, colleagues and salaries)”.
1.1.1.2. Benefits from staff satisfaction
Human resources are a decisive factor in the development of organizations
(Wheeland, 2002). To create loyalty and attachment to the organization, it is necessary to

create employee satisfaction with the work they are doing. Satisfying and creating loyalty
will help the organization reduce the costs of hiring, training and reduce errors in the
process of working from new employees. Highly skilled and experienced staffs often finish
their work effectively in a shorter time than new and inexperienced employees at work.
The influence of the quality of work and the competence of the human resources has been
recognized by quality researchers. Quality experts in the US such as Deming, Juran think
that job satisfaction will lead to productivity and performance of the company.
Japanese quality experts such as Ishikawa (1985) always emphasize the importance
of the "human element" to create a high quality working environment. Ishikawa believes
that effective quality control must be based on people management. Research by Saari and
Judge (2004) also shows that job satisfaction affects employee performance. In general,
such studies show that job satisfaction will make workers more loyal, less likely to quit
their jobs or reduce strikes or increase union activities (Saari and Judge, 2004).
1.1.2 Theory of staff satisfaction
1.1.2.1. Maslow's Needs Theory (1943)
According to Maslow, individuals are ready to act according to the level of
increasing demand. According to Maslow's hierarchy of needs, there are five types of
needs:
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Level 1: Basic/physiological needs include needs for eating, drinking,
physiologically satisfying housing, and other physical needs.
Level 2: Safety needs are security needs and are protected from physical and
spiritual harms as well as ensuring physical needs continue to be satisfied.
Level 3: Social needs are emotional needs, acceptance and friendship.
Level 4: Esteem needs are internally respected factors such as self-esteem,
autonomy, achievements and externally respected factors such as status, recognition.
Level 5: Self-actualization or the need to affirm yourself is to promote and achieve
what you can and to satisfy yourself; needs to help them improve themselves.

Figure 1.1: Maslow's Needs Theory (1943)
These five levels of human needs are described in two groups as low-level needs
(level 1 and 2) and high-level needs (levels 3, 4 and 5). The difference between the two
groups is based on the assumption that high-level needs are usually satisfied from the
inside, while low-level needs are mostly satisfied from the outside. Maslow's demand
theory was widely recognized and applied in practice during the 1960s and 1970s (Robins
et al, 2002). The weakness of Maslow's theory is that it does not give empirical evidence
for the theory and some studies to validate it have failed (Robins et al, 2002).
This is the theory of human needs and it is considered and applied in this study
because only when the needs of employees are met, they can have staff satisfaction. The
needs in this theory are addressed in the form of different variables. For example,
physiological and safety satisfaction can be expressed in variables measuring company
income and welfare. Similarly, satisfaction with social needs and self-esteem are expressed
10


in variables that express satisfaction with relationships with superiors and colleagues, as
well as a certain degree of autonomy in performing work.
1.1.2.2. Two-factor theory of Herzberg (1959)
Among the content theories of satisfaction, Herzberg (1959) theory emphasizing
the motivator-hygiene factors sought to explain satisfaction and motivation in the
organization. The theory focuses on outcomes of satisfaction and dissatisfaction. The
theory further found that certain aspects of a job cause satisfaction and therefore
motivation, but certain aspects caused job dissatisfaction. Herzberg explained that the
factors that lead to satisfaction or to dissatisfaction are different. Accordingly, he states
that „the opposite of job satisfaction is not job dissatisfaction but, rather, no satisfaction;
and the opposite of job dissatisfaction is not job satisfaction but no satisfaction‟ (Herzberg,
2003.91). This theory states that job satisfaction and dissatisfaction is a product of different
factors – motivation and hygiene respectively. Motivation is seen as an inner force that

drives individuals to attain personal and organizational goals. Motivational factors are
those aspects of the job that make people want to perform and provide people with
satisfaction. Hygiene factors include aspects of the working environment like working
conditions, interpersonal matters, organizational policies and so on (Hackman & Oldham,
1976). Factors that relate to job satisfaction are therefore called satisfiers or motivators.
According to Weir (1976) and Syptak, Marsland & Ulmer (1999), the following factors
stood out as „strong determinants of job satisfaction‟.
Achievement: This requires helping and placing employees in position that use
their talents and not to set up for failure. It is achieved by setting clear, achievable goals
and standards for each position, and making sure employees know what those goals and
strategies are. Individuals should also receive regular, timely feedback on how they are
doing and feel they are adequately challenged in their jobs.
Recognition: Refers to the honour, favourable note or attention given to an
employee for a „job well done‟ or an outstanding behaviour. Individuals at all levels in the
organization want to be recognized for their achievement on the job. The individual‟s
success does not have to be monumental before they deserve recognition. Employees
should be acknowledged for doing something well immediately after their good work.
Publicly appreciating them for finding solutions to a problem, writing a note of praise,
establishing a formal recognition program like „employee of the month or year‟, making
periodic reports directly available to the employees themselves rather than to management,
are some of the ways of recognizing employees.
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Work itself: This involves helping employees believe that the task they are doing is
important and meaningful. Setting goals and reminding and emphasizing that their efforts
lead to and contribute to positive outcomes and goal accomplishment is crucial. Success
stories and cases should be shared on how an employee‟s actions made a real difference in
the organization. Also show employees how their work is essential to the overall processes
that make the practice succeed. Unnecessary tasks can be eliminated or streamlined to

bring about greater efficiency in the organization.
Responsibility: Responsibility is taken action for ones actions. Granting additional
authority to employees in their activity, giving them enough job freedom and power so that
they feel they „own‟ the results are ways of giving them responsibility. As employees
grow, they can be provided opportunities for added responsibility by adding challenging
and meaningful work.
Opportunity for advancement or promotion: This involves electing employees from
the present job or position to a higher one or level in the organization. If possible permit
and support them to acquire higher certificates so that they could become experts
themselves and make them more valuable to the practice and more fulfilled individuals.
Factors that relate to job dissatisfaction (dissatisfiers or hygiene factors) as explained by
Herzberg are:
Pay (salary): Organizations, they say, „pay get what they pay for‟. Salary is a
contractual agreement between the employer and the employee. It not a motivator for them
but do want to be paid fairly and when due. If an employee perceives that he is not fairly
compensated, he will not be happy and so slow the pace of performance. Comparable
salaries and benefits, clear policies relating to salaries, increments, bonuses and benefits
must be clearly indicated to avoid dissatisfaction.
Supervision: This involves technical and general supervision in the organization.
Wise decisions should be taken when it comes to appointing someone to the role of
supervising. This role is difficult and requires good leadership skills and the ability to treat
all employees fairly. There should also be positive feedback and a set means of evaluating
or appraising employees.
Working conditions: The environment under which employees work has a
tremendous effect on their level of pride for themselves and for the work they do. The
provision of modern equipment and facilities, quality furniture, well ventilated offices,
well-spaced offices, secured, well-spaced staff quarters, and so on are some of the
conditions that are required to prevent job dissatisfaction in the organization.
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Company policies, administration and procedures: An organization‟s policies,
administration and procedures can be a great source of frustration for employees if the
policies and procedures are unclear or unnecessary or if those to follow are selected. A
policy permits an employee to use his discretion and initiatives in the discharge of his
duties. Policies may not make employees satisfied and motivated but it can decrease
dissatisfaction by making policies fair and applicable to all. Policy issues should be
documented (manual) and distributed to employees, their inputs should be solicited for
while comparing policies to those of similar practices. Policies should also be reviewed
from time to time. Helping employees to use their initiatives can also go a long way in
preventing dissatisfaction.
Interpersonal relationships: Relating well with peers, managers and subordinates
encourages job dissatisfaction. Part of the satisfaction in employment contract is the social
contact it brings to employees. Reasonable time should be given for socializing. This will
help to develop a sense of teamwork and at the same time cracking down on rudeness,
difficult behaviour and offensive comments. People should be encouraged to live in
harmony irrespective of cultural and other diversities.
Status: This is a person‟s social rank in a group, which often is determined by a
person‟s characteristics, in addition to the person‟s formal position. When status differ, it
may be difficult to communicate effectively in the organization. To reduce dissatisfaction,
managers should use both verbal and nonverbal forms of communications to pass messages
to employees with the highest level of probability that the information circulated will be
intact. The issue of status should also be diluted to avoid a situation whereby those with
higher status will not influence members having lower status. Individual status should not
be a yard stick for satisfaction.
Security: Security in this case refers to job security - freedom from threats of
layoffs, frequent queries, harassment, discrimination, bullying and so on. When there is no
job security, an employee‟s needs for higher growth will be blocked. If he works hard but
security does not return, he will seek to fulfill his needs elsewhere or burn out. While
motivators are part of the job content and relate to what people actually do in their work

hygiene or dissatisfies are often associated with job context: associated more to the work
setting than the nature of work itself.
1.1.2.3. Victor Vroom's theory of expectations (1964)
Vroom argued that human behavior and motivation are not necessarily determined
by reality, but rather by people's perceptions of their future expectations. Unlike Maslow
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and Herzberg, Vroom does not focus on human needs but on results. This theory revolves
around three basic concepts (Kreitner & Kinicki, 2007) or three relationships (Robbins,
2002):
- Expectancy: is the belief that effort will lead to good results. This concept is
expressed through the relationship between effort and performance.
- Instrumentality: is the belief that good results will lead to worthy rewards. This
concept is expressed through the relationship between performance and outcome / rewards.
- Valence: is the importance level of the reward for the person doing the job. This
concept is expressed through the relationship between rewards and personal goals.
Performances

Effort
Expectancy

Goals

Rewards

Instrumentality

Valence

Figure 1.2: Victor Vroom's theory of expectations (1964)
Vroom thinks that employees are only encouraged when their awareness of all three
concepts or relationships is positive. In other words, when they believe that their effort will
produce better results, which will result in a worthy reward and that the reward is
meaningful and appropriate to their individual goals.
Because this theory is based on the perceptions of workers, it is possible to work in
the same company and the same position, but one person is motivated to work and the
other is not due. Their consciousness on the above concepts is different.
Applying this theory to the research topic of this thesis, we see that in order for
employees to be motivated toward a certain goal (of course, this goal is associated with the
goal of the organization) we must create awareness in such worker that their efforts will
bring the rewards they desire. In order to gain that knowledge, we must first create
satisfaction in their current jobs, make them satisfied with the current working
environment, and with the support of their superiors and colleagues, thereby making them
more confident in their efforts that will lead to the results and rewards they expect.
Satisfaction with fairness and reward will also help them believe that the results they
achieve will surely receive recognition and reward from the company.
1.1.2.4. Adam's theory of justice (1963)
Adam's theory of justice (1963) states that people value equity by the ratio of input
to output. Inputs for a job include: personal experience, effort and competence. The output
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of the job includes wages, recognition, promotions and allowances. Discontent arises when
people feel that the results received are not commensurate when compared to what others
receive.
The theory of equity implies that when employees visualize injustice, they may
have one or several of the following five options:
-

Distorting the inputs or outputs of yourself or others.

-

Behaving in a way that makes others change their inputs or outputs.

-

Behaving in a way that changes their own inputs or outputs.

-

Choosing another comparison criterion to compare.

-

Quitting the job.
Staff satisfaction is greatly influenced by relative rewards as well as absolute

rewards. When employees perceive injustice, they will take actions to correct this situation.
The result may be higher or lower productivity, better quality or diminishment, increased
absenteeism, or voluntary termination.
The theory of fairness requires managers to pay attention to the factors that
influence workers' perceptions of fairness and thereby influence employees to have a right
understanding of fairness.
1.1.2.5. McClelland's Human Motivation Theory (1988)
David Mc. Clelland (cited by Robbins, 2002) argued that people have three basic
needs: the need for achievement, the need for alliances and the need for power. Of which:
Needs achievements
People with high achievement needs are those who always pursue solving better

jobs. They want to overcome difficulties and obstacles. They want to feel that their success
or failure is the result of their actions. This means they like challenging jobs. People with
high achievement needs are motivated to work better. General characteristics of people
with high achievement needs:
A desire to fulfill personal responsibilities.
Trends set high goals for themselves.
High demand for specific, immediate feedback.
Quickly, soon to master their work
Needs an alliance
Similar to the social needs of A. Maslow, it is to accept love, friends, etc. Workers
with this strong need will do well in jobs that create friendliness and social relationships.
Demand for power
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