I.

INTRODUCTION ON SASCO

Southern Airports Services Company Limited (abbreviated as SASCO) is affiliated with

AIRPORTS CORPORATION OF VIET NAM and ranked among the top 500 Vietnamese
largest enterprises (VNR 500).
SASCO operates in multi-business lines with various activities of services and trades at Tan
Son Nhat international airport as well as expands into outside markets through its subsidiaries
and branches.
Products and services trading:
Duty-free trading
On-the-spot export of fine-arts products, sea products, ready-made clothing, gold &
silver, gemstone and jewelry through our chain of general stores at Tan Son Nhat
international airport.
Airport services such as CIP lounge service, Spa & massage, passenger assistance
service, air ticket booking, foreign currency exchange, Limousine service, VIP

welcome service
Transportation service
Advertising trading
Farm trading
Travel, hotels and restaurants
Investment in projects of tourism and real estate.

Most popular brand names of SASCO

SASCO Duty Free Tan Son Nhat

SASCO Travel
SASCO Blue Lagoon Resort
Viet Spa

HISTORY OF DEVELOPMENT

1993: 22 Apr 1993, SASCO established

1993: Duty-free Trading Dept. established
1995: Taxi Transportation Enterprise established
2002: May 2002 : Real Estate Trading Dept. established
July 2002: Administration Office and HR Dept. formed on separation of the Corporate

Affairs Dept.
2003: Jan 2003 : SASCO Travel established.
2004: Feb 2004 : Party & Union Office established.
Feb 2004: SASCO branches in Hanoi and Phu Quoc set up

 Dec 2004: Wami water factory converted to SASCO Aviation Beverages Company
(ASB Co.) - presently referred as Southern Airports Trading Joint-stock Company
(SATCO).
2005: Jan 2005 : Taxi Transporation Enterprise converted to Saigon Airport Taxi

Holding Company (presently referred as Saigon Airport Corporation)

2006: Nov 2006 : Quality Assurance Dept. established
2007: Jan 2007 : Advertisement Trading Dept. established
Apr 2007: Investment Dept. established
Nov 2007: Phu Quoc SASCO Blue Lagoon Resort officially opened
2008: Jan 2008 : Information Technology Dept. established
Feb 2008: R&D Dept. established
Mar 2008: Viethaus in Republic of Germany officially opened
Sep 2008: Transportation Enterprise separated from SASCO to be affiliated with
Southern Airports Corporation and renamed as Southern Airport Transportation

Enterprise (presently known as Southern Airport Transportation Joint-stock Company)

2009: July 2009: Aviation Trading Services Enterprise officially renamed as SASCO
Tan Son Nhat Trading Center (STTC)
2010: May 2010: SASCOs new logo with the symbol of a flower propeller officially
launched
July 2010: SASCO converted into Southern Airports Services Company Limited.
DEVELOPMENT ORIENTATION
Focusing on business, supplying a great variety of goods and services of high quality,
meeting the demands of customers and the market;
Attempting to promote competitiveness, retaining and effectively exploiting the target
markets as the grounds for business development and expansion into other potential markets
and fields, helping the company strengthen the resources for sustainable growth;
Concentrating on developing the human resources, building professional and enthusiastic
staff to accompany and grow with the company;
Continually modernizing the equipment and facilities, promoting the study and application of
operating procedures and quality control standards, application of science & advanced
technology;
Proactively seeking and reinforcing co-operation relationships, opportunities for investment
and trading;

VISION
Stable growth, affirming its position as a leading company in Vietnam in terms of trading and
providing non-aviation diversified services of high quality up to international standards,
meeting the demands of customers, both domestic and overseas.
Making significant contribution to services trading at the airport, making the most of the
facilities, upholding the companys brand and prestige and raising competitiveness of Tan
Son Nhat international airport.
MISSION
Providing high quality products and services, targeting at boosting non-aviation services
trading, satisfying customers needs and development requirements of Southern Airports
Corporation;
Building a strong corporation in terms of potentials, branding and prestige, business
performance, fulfilling assigned tasks, actively contributing to the common development of
the aviation in particular, the society and the country in general;
Reinforcing, developing and well-exploiting the resources, ensuring sustainable growth,
creating good work conditions and corporate culture, catering to the material and spiritual life
of the staff, facilliating every member with opportunities and favorable conditions for work,
study, devotion and self-improvement;
Maintaining and promoting the tradition business growth linked with benefits of social
community, intensifying gratitude and social charity work as well as acts for the sake of the
community performed by Trade Union and Youth Union of the company.
REMARKABLE ACCOMPLISHMENTS
SASCO is one of the leading units in aviation in terms of productivity, quality, business
efficiency and State budget contribution.

Current staff strength: 1447 persons, increased nearly threefold against the number of over
500 persons at establishment.
With significant contribution in socio-economic development of the civil aviation of Vietnam
in particular and the country in general, SASCO has been honorly granted with outstanding
awards:
In 1995, Third Labor Medal awarded
In 1999, Second Labor Medal awarded

In 2003, First Labor Medal honorly awarded

From 1993 to 2009, SASCO has continually received certificates of merit, excellent
emulation banners of the Government, Ministries, State agencies, Civil Aviation
Administration of Vietnam and HCMC Peoples Committee.
In 2008, SASCO was honorly awarded with ISO Gold Cup as an excellent organization in
applying quality management systems of international standards.
For three consecutive years of 2008, 2009, 2010, SASCO has been ranked among the top 500
Vietnamese largest enterprises (VNR500) by Vietnam Report and Vietnam Net Online
Newspaper.
In 2010, SASCO was honorly ranked 202nd among 1000 enterprises contributing the most
income tax in Vietnam (V1000) by Vietnam Report and the Tax Journal of General
Department of Taxation;
For three consecutive years from 2008 to 2010, SASCO has been ranked by CIC Credit
Information Center- State Bank of Vietnam as AAA which is the highest level in Corporate
credit ratings (*).

1.

METHODOLOGY

Research methodology is mainly used in this paper is quantitative method by employees

questionnaire. Moreover, we also find the insights of the employees through interview and
observation. Data necessary for the research will be collected from both the management and
the staff. Data includes three parts: recruitment, compensation and employees satisfaction is
measured by a list of question relatively to four- point scale in the survey. (1 - total
unreasonable, 2- unreasonable, 3 - reasonable, 4 - total reasonable).
1.4

OVERALL APPROACH

The research will follow by this diagram. The steps in this paper include: First, we review
theories about recruitment activities, compensation and whether two these factors affect on
the satisfaction of employees, then, we develop questionnaires for collecting ideas. Second,
we begin to analyze collected data. Finally, we get conclusion and after that some
recommendation about the company will be indicated.

Theories
Collect and
of recruitment,
Analyze data
compensation and employees satisfaction; statistic

Relationship between two factors with employees satisfaction, influence of compensation and em
Examine some points in the recruitment and compensation

Conclusion

Recommendation

CHAPTER 2
LITERATURE REVIEW

INTRODUCTION:
We do the research about The Impact of Human Resource Management: The Case of
Southern Airports Services Company.

The purpose of the literature search is carried out to rephrase the theory and some other
researches relevant to factors effecting to high rate of turnover subject; and satisfaction of
employees. These materials include books, materials suggested by advisor, internet, textbook
and so on.
We illustrated this chapter by following model and will cover this tree in the following
section:

HRM

Compensati
on

Recruitment

Recruiting
process

Selecting
process

Financial
payment

Peer

Working
environmen
t

Benefit
packages

Employees
satisfaction

HRM includes many factors such as recruitment, compensation, peer, working environment
and so on. However, we just focus on recruitment, compensation that can affect directly to
rate of turnover in the company.

2.1

Definition of Human Resource Management:

Human Resource is the people an organization employs to carry out various jobs,

tasks, and functions in exchange for wages, salaries, and other rewards.
The more society develops, the more people realize the importance of human
resource management. Following the definition of Human Resource, we go to define: What is
Human Resource Management (HRM)?

Human resource management refers to the comprehensive set of material

activities and tasks concerned with developing and maintaining a qualified workforce
human resources in ways that contribute to organizational effectiveness(DeNisi and
Griffun, 2005)
Another concept of Gilley defines human resource management as the
recruitment, selection, retention, development, and utilization of and accommodation to
human resources by organizations (Gilley, p. 9).
Human resource management is the activity of managing people and the business
of an organization (2007). In simple sense, Human Resource Management means the
recruitment, selection, employment legislation, discipline, development, rewards systems,
training, trade unions, productivity, motivation

2.2

The function of Human Resource Management (HRM):

According to Dickson (1998, p.14), the roles played by HRM are:
Support system that can provide guidance and supervision for people

management in workplace
Human resource means that it will include necessary task such as training,
development, recruitment and planning.
Strategic management plays an important part with the corporate strategy.
Simple sense, HRM plays an important function includes a variety of activities,
and key among them is deciding what staffing needs to have and whether to use independent
contractors or hire employees to fill these needs, recruiting and training the best employees,
ensuring they are high performers, dealing with performance issues, and ensuring the
personnel and management practices conform to various regulations. HRM is also a
necessary part in value chain management- a terms of its purpose is obtain that benefits of
vertical integration without associated costs.

Porter's Value Chain

Source: wiki media
We can not have a good value chain management, the movement of raw materials
into an organization toward the end-consumer unless we have a HRM because it deals with
recruitment, leadership development, retention good practices, team management, corporate
governance and ethics, effective training and the benefits of HR outsourcing in order to have
more effective labor source. Therefore, HRM is an important function for organizational
development.
2.3.1

Recruitment process:

a.

Definition:
As Dessler (2003) had a definition that Recruitment is the process of attracting

individuals on timely basic, in sufficient numbers, and with appropriate qualifiactins, and
encouraging them to apply for the jobs with an organization.
Another concept of Margaret A. Richardson (2007) wrote Recruitment, as HRM
function, is one of the activities that impact most critically on the performance of the
organization .He found that we understood and accepted poor recruitment decisions would
affect to organizational performance and limit goal achievement.
Following DeNisi and Griffun(2005) defines recruitment develops a pool of
qualified applicants who are interested in working for the organization and from which the
organization might reasonably select the best individual or individuals to hire for
employment. Organizational goals in recruiting are to optimize, in various ways, the size of

the pool of qualified applicants and to offer an honest and candid assessment to prospective
applicants of what kinds of jobs and opportunities the organization can make available to
them. Individual goals in recruiting include satisfying personal work goals, various
idiosyncratic goals, and perhaps optimizing personal situations.
External
Environment
Internal
Environment
Human
Resource
Planning
Alternatives to
Recruitment
Recruitment

Internal Source

External Source

Internal Method

External Method

Recruited Individuals

Figure 1: The recruitment process

Source: R.Wayne Monday and Robert M. Noe, p.175

Following the figure 1, we see that recruitment is a complex process. When doing
HR planning, the managers find out that they need more labor for productivity. Firstly, they
explore various alternatives to recruiting whenever feasible. If the alternatives do not meet
their needs, the recruiting process runs. The recruiting process begins when a certain manager
submits a requirement form about personnel for HR Department. The requirement form
describes various detail such as job title, suitable departmentWith these information,
manager of HR deals with job description and job specification to define employees standard
for job. After that, the managers will overview which employees in company can meet their
requirements or they must hire from external sources.
Because the recruiting process is so expensive, so, the managers need to use
recruiting methods and HR efficiently.
There are some alternatives to recruiting: overtime, temporary workers, employee
leasing, part-time workers
b. Source of recruitment:
Internal recruiting is the process of looking inside the organization for existing
qualified employees who might be promoted to higher-level positions.
According to Internal Recruiting, most common method that organization often
uses is process called job posting. It is vacancies in the organization are publicized through
company newsletters, bulletin boards, internal memos, and the firms intranet. In this job
posting, recruiter takes note clearly vacancies, some requirements before applying for that
job, employees standard.
Another method of internal recruitment is through supervisory recommendations.
If an existing employee is particularly well suited for the new job opening the supervisor
recommends that individual to the higher-level manager. In this method, the supervisors give
equal consideration to all potential candidates. Therefore, every potential person has equal
performance for promotion.
Still another method is through union halls. This method has strong and well
establishment unions. This approach may parallel those of job posting- job opening are listed.
In brief, when the organization wants to hire people quickly but they do not have
much time. I think it is useful for recruitment by sticking the recruiting needs on the boards of

the internal organization. Most of large companies in Europe, the US, especially in Japan,
they often use the internal sources. (Nguyen Huu Than, 2004, p177)
External recruiting is the process of looking to sources outside the organization
for prospective employees
A method for external recruiting is by general labor pool. It is the local labor
market from which a firm hires its employees.
Referral is also a method for external recruiting. An individual is prompted to
apply for a position by his/her friends within the organization. If employees feel satisfied
when working, they often want their friends joining work.
Direct applicants are also a common external source of applicants. Individuals
apply for a position with the organization without any action on the part of the organization.
The organization does not need to do anything to attract these candidates.
When doing external recruiting, managers often use some techniques such as word
of mouth, advertisements, public employment agencies, private employment agencies,
executive search firms, college placement offices, and electronic recruiting.
Word of mouth recruiting is an expensive way to generate a large number of
applicants. The organization informs present employees that positions are available and
encourages them to refer friends, family members, or neighbors for those jobs. In fact, if we
assume that present employees are satisfactory and that people are similar to them, the
organization will have high quality applicants and if the organization relies on recruiting
technique exclusively, however, the problem may arise. This is disadvantage of this method.
Advertisements in newspapers, television, radio, the internet.This form of
advertising tends to be relatively expensive and attract somewhat fewer qualified applicants
than some of the other recruiting methods. This method will be used when the other methods
are so expensive and difficult.
Public employment agencies and private employment agencies are good for
recruitment. However, these methods are quite expensive to various countries in the world. In
Ho Chi Minh City, the fee for each service is different, it depends on the type of company
such as foreign company, internal or corporate companyThe fee for service is cheaper than

developed countries. They require employees for job applicant, and then they apply for
company X. If this candidate will be hired, they will charge a fee for agencies services.
Electronic recruiting is cost effective. It does cost much to post a job opening on a
job board like available websites and can reach a large number of applicants. Moreover,
electronic recruiting saves time because the internet connects on the company website. The
applicant can send resume or otherwise apply for job via email. On the other hand, there are
some disadvantages such as many people may apply for a job they are not really qualified for
or staff members have the additional work of sifting through resumes from unqualified
people and responding to a lot of e-mails. In addition, differences in access to computers and
the Internet may result in fewer diverse candidates. The important things are websites must be
well designed and easy to navigate.
Other sources for recruiting that are relevant to college student are placement
offices. The advantage is that it is a relatively inexpensive method of recruiting because the
college and university provide the facilities, schedule the appointments and so forth. The
organization sends interview to the campus and that individual sit in the interview room
during the course of the day. The recruiters focus on students major, grade point average,
work experiencethese are some requirements for recruiting.
2.4
a.

Compensation:

Definition:
Compensation is the set of rewards that organizations provide to individuals in
return for their willingness to perform various jobs and tasks within the organization.
Compensation includes the total set of rewards an organization provides an employee in
return for his or her work. Thus, it is more than just a weekly or monthly paycheck. In fact,
compensation deals with the salary and employees benefit package.
People work for many reasons. The most obvious reason is need for money.
However, it also bases on pay and benefits, job security, and fair policies (Brief, 1998;
George and Jones, 2008).

b.

Type of compensation:

Direct financial payment: Wages, salary, commission, bonus

Wages generally refer to hourly compensation paid to operating employees; the

basis for wages is time.

Salary is income paid to an individual on the basis of performance not on the basis
of time.
Commission plan pays salespeople for result, and only for results

Indirect compensation and benefits: social security, unemployment insurance,

workers compensation, paid time off (vacation time, holidays, religious days, sick
leave and personal time), childcare those always make employees satisfied when
working.

2.5

Employees satisfaction:
Job satisfaction has the potential to affect a wide range of behaviors in

organizations and contribute to employees levels of wellbeing. Employees, who are more
satisfied with their jobs, tend to perform better than those who are less satisfied. (George and
Jones, 2008)
Dormann and Zapf (2001) indicate that dispositions affect job satisfaction via
selection and self-selection process.
In a 2007 Annual Compensation Survey of nearly 600 ID readers, respondents
cited pay as the most important factor in their job satisfaction (Kickham, 2007).
Compensation is an important factor to keep employees commitment in the job. salary,
44%, and benefits, 23%. (Kickham, 2007. p.30). It is very an important for organization to
have suitable employees compensation.

Personality/ dispositional
Value: Extrinsic/ Intrinsic
Intrinsic factor:
-Promotion
-Personal growth
-Recognition
-Responsibility
-Achievement

Extrinsic factors:
-Supervision
-Compensation
-Recruitment
-Works conditions
-Relation with other
-Job Security

-Organization commitment
-Organizational Citizenship
-Employees Well-being

Job satisfaction or Dissatisfaction

-Absenteeism
-Turnover intention
-Turnover

Social influence

Life Satisfaction

Figure 4- Conceptual Framework of factors affect Job Satisfaction and Dissatisfaction

Source: Issam Ghazzawi, Ph.d., University of La Verne, CA

HUMAN RESOURCE IN SASCO

According to the survey made by the HR Department of SASCO, we can devide into these
below problems:
Resource redundancy
Inappropriate HR policies
High rate of turnover
1. Resource redundancy:
Redundancy at work occurs when the use of labour force in a company is inappropriate.

HIGH RATE OF TURN OVER

Employee turnover. It's a common source of frustration for many organizations. Negative
effects are loss of productivity, diminished morale, strained communications between
management and employee, and, of course, the increased costs of hiring and training new
employees. SASCO does have this problem and it is an extremely painful problem in the
company. According to The Health Care Group's 2001 Staff Salary Survey, turnover is

highest among receptionists, but it's a problem for many other positions as well. In SASCO,
the highest turnover rate is among the salesperson. To be more detailed, lets look at how
many departments existing in SASCO:
-

Office person (normal working hour)

Salesperson (shift working hour)

Driver (shift working hours)

Staff in resort and restaurant (shift working hour)

There are driver and staff in restaurant and resort who have shift working hour, but why high
turnover rate occurred in the salesperson?

RECOMENDATION

5.1 Summary of main findings:

First, concerning recruitment, in general recruitment activities of SASCO are
quite good. Most of candidates are satisfied about the required information in application
before they are recruited, they realize that all questions giving for them are very reasonable;
the fully received information of their job before they sign the labor contract or the job
information is similar to job descriptive of the company. Almost everything is clear and
employees have a good look about recruitment activities in SASCO.
However, there are still some problems in recruiting and selecting process, such as
unsuitable interview questions when recruiting and unfairness to the applicants. SASCO was
unfair in recruiting with priority to people who have special relationship with management.
Unfair recruitment will affect to the chance of hiring a good person in a position. Therefore,
SASCO is very careful about unfair recruitment but it is also the Vietnamese culture of some
enterprises.
Second, SASCO also performs compensation policy for labor force quite well.
Employees speak highly of compensation policys system of SASCO with over 80% people
think it already existed and agreed with it. Moreover, social insurance and medical insurance
are carried out for employees very well and they have no complaints about these factors of

company compensation. When knowing that their employees have difficult lives, the
company is willing to help them out. In addition, it is very kind of the company to have
organized outdoor activities sometimes for labor. ( a co bit chuong trinh tu thien hay cong tac
xa hoi nao cua SASCo thi a them vo nha)Surely, SASCO deeply knows the way how to make
employees feel more comfortable under working pressure, and save up a suitable time for
employees relaxing.
However, there are some disadvantages we find out in this research such as the
compensation of company has not been consistent with everybody yet, with many yearworking people were offered advantage packages while others were not. Currently, financial
payment for labor force is not fairly suitable at all in company. Most of pay ranges per year
for manager increase considerable while its employee is only ...per year (a bom dai so nao vo
day nha). As we observe in the descriptive data about employees salary, 54% employees
think that the company should reconsider their pay range to match their ability and
contribution for company in the past up to now ( check so % cho hop ly nha anh). Moreover,
we know that SASCo also has Sale department in the ariport, but it does not be conroled
strictly, does not have profesional cameras to check. Therefore, when goods are stolen, the
employee working in this shift must take all responsibility for this stealing. They do not be
protected any more by the HR department.
5.2 Recommendations:
Generally, employees quite dont have any commnet about HR activities in
SASCO. However, to make company develop better, the HR department also review some
aspect as following. Interview must base on the job specification and job descriptive to select
right candidates for requirement of the company. Avoiding common questions, the company
could have specific questions about job that they need to recruit. Hence, applicants will image
the concrete job they have to do if they are recruited and not to be new to the surrounding.
For this reason, human resource department and another department need to have
a meeting so that they can analyze job for job specification and job descriptive. Depending on
job descriptive, suitable candidates who have good knowledge, experience, skill, ability and
etc can be recruited. Simultaneously, mangers can have a common evaluation about
employees by job specification. Moer than that, SASCO should be fair in recruiting with no
priority to people who are familiars, relatives, etc. It makes employees feel satisfied more
about recruitment activities too much. In fact, recruitment activities play an important role in
the company development. Unfair recruitment will affect the chance of hiring a good person

in a position. In addition, a suitable person with great ability could contribute much in
SASCOs productivity and the human resource of company will be more stable basing on it.
The second thing that company should take care about is the pay range for
employees. Money increase just 300,000 VND (ben a tang luong gan nhat la bao nhiu bom so
dzo day a) is not pleased by employees because it does not enough to support themselves and
their families indeed. For two reasons I had just analyzed above, SASCO ought to recruit
employees have professional skill and pay a suitable salary for them to ensure their life better
and the quality of products also, limit recruiting people with relatives inside company.
It way proceed by benefit packages, compensation policy must be fair with
everybody. Some employees are not pleased at compensation of company because they have
discrimination between managers and employees; most of managers are received
compensation better than employees such as in holiday they have more time for relaxing or
pay range increases considerable every year. In general, employees often need to get
encouragement from managers by having more incentive based system for somebody who
has a good contribution for company such as: good ideas, good introduction about excellent
person, etc rather than only seniority. I think it is unfair in this field, so the company should
improve that again. Ouchi (1943) said that working behavior depends on how they are treated
in working environment. Hence, company might have more consideration not about
employees job only but their family also so that company can help them solve problems
easier. As consequence, they feel the company always care about them and want to have
strong attachment to the company.