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ISSN : 2288-4637(Print)
ISSN : 2288-4645(Online)
The Journal of Asian Finance, Economics and Business Vol.7 No.9 pp.621-629
DOI : https://doi.org/10.13106/jafeb.2020.vol7.no9.621

The Impact of Human Resource Management Activities on the Compatibility and Work Results

Duc Trung NGUYEN1,Van Dung HA2,Truong Thanh Nhan DANG3
1 First Author. Banking University Ho Chi Minh City, Vietnam. Email: trungnd@buh.edu.vn
3 Faculty of Business Administration, Banking University of Ho Chi Minh City, Vietnam. Email: nhandtt@buh.edu.vn

© Copyright: The Author(s)
This is an Open Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License (https://creativecommons.org/licenses/by-nc/4.0/) which permits unrestricted non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited.
2 Corresponding Author. Institute for Banking Science and Technology Research, Banking University of Ho Chi Minh City, Vietnam [Postal Address: 39 Ham Nghi Street, District 1, Ho Chi Minh City, 70000, Vietnam] Email: dunghv@buh.edu.vn
June 29, 2020 July 12, 2020 August 10, 2020

Abstract

This research focuses on determining the impact of human resource management activities on the compatibility and work results of employees of Ho Chi Minh Stock Exchange (HOSE) listed companies. The paper includes five parts: introduction, literature review, research methodology, research results, and conclusion and policy implications. The data are collected from the survey of 350 listed companies in HOSE, in which 315 survey notes filled with sufficient information are used for analysis. The paper employs both qualitative method and quantitative method. Group discussion of 10 experts is for qualitative research. Quantitative method performs analysis of Statistics, Cronbach’s Alpha, EFA analysis, CFA analysis and SEM model. The results of the research clearly indicate that human resource management (HRM) activities are measured through improving the ability, improving the motivation and improving the opportunity. While compatibility is measured through suitability, connection and sacrifice; whereby HRM activities of ability improvement have a positive effect on the job suitability and connection; HRM activities of motivation improvement have a positive effect on the job suitability, connection and sacrifice; and HRM activities of opportunity improvement have a positive effect on the job suitability, sacrifice and connection; Finally, the job suitability, sacrifice and connection positively affect the work results of employees.

JEL Classification Code: C31, J53, M12

초록


1. Introduction

 

Human resources are the key factors that make profits for the organization, they ensure all creative resources in the organization. People are still an important factor besides the equipment, assets to serve the development of the organization, because without people, it is impossible to operate those resources to bring the best results for the organization. (Callea et al., 2016; Villajos et al., 2019; Nguyen, 2020).

However, in the context of current economic development, the fierce competition has led to the consequences of moving human resources between units and sectors. In fact, units and sectors with good incomes and ideal working environment will increasingly attract and retain quality staff to serve the work and increase work results. This seriously affects the quality of staff as well as the work results of other units (Tian et al., 2016, Swalhi et al., 2017). In this context, it is essential to learn, research, analyze and evaluate the factors of human resource management activities affecting the work result. Human resource management activities are considered as the basis and foundation to help better compatibility at work because the policies and supports from the unit for employees are expressed through human resource management activities, thereby promoting better work results (Tian et al., 2016). And now there are many domestic and foreign studies that are constantly being exploited and implemented, units in different sectors and fields also need to do this to increase the work result of their employees.

Based on that foundation, the objective of this research is to identify and measure the impact of human resource management activities on the compatibility and work results of companies listed on HOSE. Based on the results, the research proposes administrative implications to improve the work result of those companies.

 

2. Theoretical Basis

 

2. 1. Human Resource Management (HRM) Activities

 

The term of HRM is a strategic, integrated and coherent approach to the employment of staff in organizations. For Boxall et al. (2007), it is about managing the work and the people in the desired direction. Som (2008) described HRM as a carefully designed combination of works that aim to improve organizational efficiency and, thus, achieve better performance. Many researchers identified HRM in different ways. Researchers have given various names for human resource management activities such as "best practices" or "high performance" (Huselid, 2005; Villajos et al., 2019), "sophisticated" (Golhar & Deshpande, 1997; Hornsby & Kuratko, 2000; Goss et al., 2004) or "professional" (Gnan & Songini, 2003).

Human resource management activities are claimed to initiate positive exchange relationships especially when managers are able to provide evidence of consideration and attention to the individual needs of workers (Tian et al., 2016; Ong & Koh, 2018). Delery and Doty (2006) conceptualized human resource management activities as a set of consistent internal policies and methods established and applied to ensure the organization's human resources in order to contribute to achieving its goals. Swalhi et al. (2017) described human resource management activities as a set of separate, but interrelated activities, functions and processes directed at attracting, developing and maintaining “human resources” of an organization.

For this research, human resource management activities are understood as consistent internal policies and methods established and applied to ensure the organization's human resources contribute to achieving the organization's goals, coming up with solutions for developing human resources and human resource management activities to help improve the ability, opportunity and motivation of employees. HRM activities of ability improvement are HRM activities that include recruitment, selection, training and development practices; human resource management activities that enhance the ability play a key role in determining the suitability of the work and the organization (Tian et al., 2016); HRM activities of opportunity improvement, according to Jiang et al. (2012), are human resource management activities that create opportunities to carry out activities related to work design, team utilization, employee engagement, complaints and the process of handling complaints and sharing information widely and HRM activities of motivation improvement are activities designed to encourage employees to devote their efforts to the work, including those related to performance evaluation, compensation, work security and incentives for work (Tian et al., 2016).

 

2. 2. Job Compatibility

 

The initial concept of job compatibility includes organization compatibility and community compatibility, all of that is expressed through three components: suitability, sacrifice, and connection. Suitability is defined as an employee's awareness of compatibility or comfort with an organization; the better the suitability is, the more likely the employee will feel professional and attached to their employer (Mitchell et al., 2001); Sacrifices characterized by physical or psychological benefits can be lost by leaving current work (Mitchell et al., 2001; Aboul-Ela, 2017). Therefore, financial losses (e.g., high salaries or attractive benefits) and psychological losses (e.g., loss of support from the organization) are important measures of sacrifice in the work of employees. Connections are formal or informal connections between a person and organizations or others (Mitchell et al., 2001). The more connections that tie an employee to others in the same organization, the more he or she becomes attached to work and the organization, reluctant to leave the organization.

Therefore, it can be understood that the job compatibility refers to how employees feel comfortable with the organization, are attached to their employer/ leaders, and are connected with their colleagues (Jiang et al., 2012). In studies that mention job compatibility, most scholars agreed that job compatibility consists of three independent components: suitability, sacrifice, and connection.

 

2. 3. Work Results

 

The employee's work result shows that the employee's financial or non-financial results are directly linked to the organization's results and success (Nguyen et al., 2019). At the same time, in order to improve employee's work results, it is necessary to focus on promoting employee engagement (Tian et al., 2016). Research by Christian et al. (2011), Leiter and Bakker (2010) also showed that the presence of high level of employee engagement helps improve work results, through the performance of civic organization's duties and behaviors, productivity, discretionary efforts, emotional commitment, and ongoing commitment.

The work results are the direct and indirect contributions of employees to the work to achieve the organization's goals. A more recent definition by Swalhi et al. (2017) stated that work results are the total expected value that individuals perform on their assigned work. It is important to note that work results are difficult to track by a single indicator and instead, it closely resembles an underlying structure, evaluated and measured by many different factors (Callea et al., 2016).

 

2. 4. Research Hypotheses

 

2.4.1. The Relationship between Compatibility and Work Results

 

Although job compatibility has been studied primarily as work that affects the revenue of organizations, there are also many studies showing that it can also have an impact on work results and civic behavior (Burton et al., 2010; Lev & Koslowsky, 2012). In two aspects of job compatibility, research showed that compatibility with the organization is a better predictor of work results than compatibility with the community (Sekiguchi et al., 2008). It is argued that people with high organizational cohesion tend to be motivated to achieve higher work results (Tian et al., 2016). Sekiguchi et al. (2008) and Villajos et al. (2019) argued that employees engage with projects and relate to each other at work who feel appropriate to their work and can apply their skills (i.e., suitability) and believe that they will lose valuable things if they leave their work (that is, sacrifice), so they must try to perform their work and duties well.  Harris et al. (2011), and Wheeler et al. (2012) argued that job compatibility involves factors of suitability, sacrifice, and connection that promote work results through the benefits that result from the work (for example, better access to advice and job support). The factors of suitability, sacrifice and connection almost have a positive impact on the work results (Feldman, 2013; Aboul-Ela, 2017). Therefore, the author proposes the following hypothesis:

 

H1. Suitability (a), Sacrifice (b) and Connection (c) in the organization have a positive effect on Work results.

 

2.4.2. The Relationship between Human Resource Management Activities and Compatibility

 

Empirical studies have shown that HRM activities have a positive impact on employees’ commitment and satisfaction, resulting in better work results (Kehoe & Wright, 2013); and improve revenue results (Kehoe & Wright, 2013), improve productivity and financial efficiency (Callea et al., 2016). Recent assessments suggest that the close combination of HRM activities is likely to support the performance of any individual better, and it has a positive impact on job compatibility, which improves job fit, sacrifice, and connection (Kehoe & Wright, 2013). Studies and assessments of HRM activities also show the positive contribution of HRM activities to the increase of job suitability, sacrifice and connection (Jiang et al., 2012).

HRM activities help improve the motivation to increase employees’ efforts and perseverance, as well as improve the opportunity to empower employees to use their skills and motivation to achieve the organization’s goals, teamwork, engagement in decision making and information sharing (Gardner et al., 2011; Ong et al., 2019). Job compatibility can be developed through HRM activities, and many studies have examined the impact of HRM activities on job compatibility (Bambacas & Kulik, 2013). Bergiel et al. (2009) found that job compatibility was an intermediary factor in promoting HRM activities for improving the work results. Bambacas and Kulik (2013) found that job compatibility is an intermediary factor between employees’ perceptions of HRM activities (employee development, performance assessment, rewards) and revenue issues.

As regards HRM activities of ability improvement, HRM activities include recruitment, selection, training and development practices; human resource management activities of ability improvement play a key role in determining the suitability with the job and organization. However, because training and development leads to an increase in employees’ cognitive benefits at work, HRM activities have a positive impact on job compatibility. HRM activities of ability improvement are a stepping stone to improving the job suitability, sacrifice and connection because the increase in training and development activities contributes significantly to improved employees' positive thoughts and engagement with the organization (Tian et al., 2016). Therefore, the author proposes the following hypothesis:

 

H2. HRM activities of ability improvement have a positive effect on the job suitability, sacrifice and connection.

 

HRM activities of motivation improvement are activities designed to encourage employees to devote themselves to their work, including those related to performance assessment, compensation, job security and incentives (Kehoe & Wright, 2013; Tian et al., 2016). Ensuring safe and rewarding job that enhances the suitability for all employees at the place where they are staying and their sense of job sacrifice is the main task in HRM activities of motivation improvement (Tian et al., 2016). In many cases, the assessment of work results is based on many relationships (colleagues, subordinates) and many other impact factors (Tian et al., 2016). Motivations in HRM activities are seen as the basis for improving the job suitability, sacrifice and connection (Kehoe & Wright, 2013; Tian et al., 2016). Therefore, the author proposes the following hypothesis:

 

H3. HRM activities of motivation improvement have a positive effect on the job suitability, sacrifice and connection.

 

HRM activities of opportunity improvement, according to Jiang et al. (2012), are human resource management activities that create opportunities to carry out activities related to work design, team utilization, participation of employees, complaints, and the process of handling complaints and sharing information widely. Job characteristics such as autonomy and diverse skills that provide flexibility and discretion allow a person to achieve a greater suitability in knowledge, skills, abilities, and other personal attributes (Tian et al., 2016, Swalhi et al., 2017). Teamwork and employee engagement are likely to strengthen relationships with others in the workplace (connection), while the tradeoff between current functions and tasks and opportunities in the future is something that must be considered upon the assessment of HRM activities (sacrifice) (Callea et al., 2016, Swalhi et al., 2017, Ha, 2020). Therefore, the author proposes the following hypothesis:

 

H4. HRM activities of opportunity improvement have a positive effect on the job suitability, sacrifice and connection.

 

3. Research Methods

 

Here are the two methods used:

- Qualitative method: The author conducts discussions with 10 experts to collect ideas about adjusting or adding scales to the research context.

- Quantitative method: It is used to analyze survey data from 315 companies listed on the HOSE. Survey forms are sent via post and the author calls to remind the companies. Basic analytical techniques (Statistics, Cronbach's Alpha, EFA, CFA, and SEM) are conducted by SPSS 20 and AMOS 20 software to demonstrate the impact of human resource management activities on the compatibility and work result of companies listed on HOSE (see Table 1).

 

 

 

 

It is necessary to investigate the samples whose number must be five times the number of variables (Hoang & Chu, 2008). Therefore, the minimum sample size of this study is 165 samples, corresponding to 33 variables. However, to ensure high representativeness, the paper surveys 350 samples, which produced 315 valid observations. Out of 315 subjects surveyed, there were 112 women, accounting for 35.6%, and 203 men, accounting for 64.4%; Deputy director positions accounted for the highest proportion, with 58.1%; The age group is mainly above 30 years old at the proportion of 85.4% and the seniority is mostly over 5 years with 90.8%.

 

4. Research Results

 

Cronbach's Alpha analysis results show that the variables have the corrected item total correlation greater than 0.3 (except for variables/scales of AB5, MO2, OP7, OP8, OP9) and Cronbach's Alpha indexes were greater than 0.7.

28 variables belonging to factors AB (HRM activities of ability improvement), MO (HRM activities of motivation improvement), OP (HRM activities of opportunity improvement), SU (Job suitability), CO (Job connection), SA (Job sacrifice), and WR (Work result)) are included in the Exploratory Factor Analysis (EFA). EFA analysis results show that KMO = 0.760 > 0.5 and the Chi-Square statistic of Bartlett's test is valued 7,590.922 with Sig. = 0,000 << 0.05. Therefore, all variables are satisfactory to include in the model analysis (see Table 2).

 

 

 

 

The eigenvalue is 1.247 greater than 1 and stops at the third line with the total variance extracted is 72.456% greater than 50%. This value is quite high with 72.456% of data variability explained by three factors. At the same time, all factor loads are greater than 0.5 and arranged in seven separate groups of factors. These are groups of factors AB, MO, OP, SU, CO, SA, and WR.

The results of CFA analysis show that the convergence concepts and data ensure the requirements for model analysis, because, CFA analysis results show that the value of Chi-square/df = 2.252 is less than 5, GFI = 0.861 > 0.8, TLI = 0.937 > 0.9, CFI = 0.945 > 0.9 and RMSEA = 0.063 < 0.1. At the same time, standardized results of CFA show the factor weights are greater than 0.5. Thus, with CFA analysis results, the main factors are included in the analysis, which are: AB, MO, OP, SU, CO, SA, and WR.

Along with that, the factors ensure reliability when included in the analysis, because the variance extracted is greater than 0.7 and composite reliability is higher than 0.5. The values reach discriminant value, which is shown by the correlation of the significant factors at 5%. The results of the Structural Equation Model SEM are suitable. This is reflected in such indicators as: Chi-square/df value = 2,251 < 5, GFI = 0.859 > 0.8, TLI = 0.937 > 0.9, CFI = 0.945 > 0.9 and RMSEA = 0.063 < 0.1 (see Table 3).

 

 

 

 

At the same time, based on P-value values, the statistically significant relationship of the factors is shown, namely:

- HRM activities of ability improvement are statistically significant in influencing job suitability and job connection because P-value values are 0,000 and 0.008, less than 5%. HRM activities of motivation improvement are statistically significant in influencing job suitability, job connection and job sacrifice because P-value values are 0.006; 0,000 and 0.002. And HRM activities of opportunity improvement are statistically significant in influencing job connection because the P-Value value is 0,000.

- Job suitability, job sacrifice and job connection are statistically significant in influencing job performance because the P-value values are 0.007; 0.006 and 0.007.

- Meanwhile, HRM activities of ability improvement are statistically significant in influencing job sacrifice because the P-value value is 0.213, greater than 5%. And HRM activities of opportunity improvement are not statistically significant in influencing job sacrifice and job suitability because P-value values are 0.810 and 0.469, which are higher than 5%.

Along with that, the regression coefficients are greater than zero, showing a positive relationship between factors, namely:

HRM activities of ability improvement have a positive impact on job suitability and job connection with impact factors of 0.08 and 0.06; so, when HRM activities of ability improvement are better (increase by 1 time), the job suitability and job connection will increase by 0.08 times and 0.06 times respectively. HRM activities of motivation improvement have a positive impact on job suitability, job connection and job sacrifice with impact factors of 0.004; 0.39 and 0.04; so, when HRM activities of motivation improvement are better (increase by 1 time), the job suitability, job connection and job sacrifice will increase by 0.004 times; 0.39 times and 0.04 times. HRM activities of opportunity improvement have a positive impact on job connection with an impact factor of 0.43; so, when HRM activities of opportunity improvement are better (increase by 1 time), the job connection will increase by 0.43 times.

And job suitability, job sacrifice and job connection have a positive impact on work results with impact factors of 0.03; 0.06 and 0.03; so, when the job suitability, job sacrifice and job connection are respectively better (increase by 1 time), the work results will increase by 0.03 times; 0.06 times and 0.03 times. Thus, after performing analysis of linear SEM structure model, the research showed the impact of human resource management activities on the compatibility and work result of companies listed on HOSE (see Figure 1).

 

 

 

5. Conclusion and Policy Implications

 

5. 1. Conclusion

 

This research focuses on determining the impact of human resource management activities on the compatibility and work results of companies listed on HOSE. The results of the research clearly indicate that human resource management (HRM) activities are measured through improving the ability, improving the motivation and improving the opportunity, while compatibility is measured through suitability, connection and sacrifice. HRM activities of ability improvement have a positive impact on the job suitability and connection; HRM activities of motivation improvement have a positive impact on the job suitability, connection and sacrifice; and HRM activities of opportunity improvement have a positive impact on the job suitability, sacrifice and connection. Finally, the job suitability, sacrifice and connection positively affect the work result.

 

5. 2. Policy Recommendations

 

The paper proposes the following policy implications to improve the work results of the companies listed on the HOSE:

Companies should improve the job compatibility through activities. Companies should always create conditions for employees to use their skills and talents well at work; as well as show employees the benefits of working at the company; enhance the propaganda activities on the goals and orientations of the company for employees to know, thereby helping employees understand and set out the direction to achieve their specific work goals. Moreover, the companies need to show their employees the short-term and long-term working plans of the company and associate them to the development and growth of scale and sales. It is especially important to promote the employees’ working attitude, clearly defining the employees’ roles, responsibilities and obligations so that they are well aware of their job positions, thereby showing their key role in the company.

Companies enhance human resource management activities. Companies need to have recruitment and training plans and training programs, which are suitable to the current situation and needs. It requires the development of specific criteria in evaluating work performance and assessing work results that must ensure the timeliness. Salaries, bonuses and allowances must be delivered on time and granted according to the capacity and working ability of each employee.

Figure

Table

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