Luận Văn IMPROVING PETROL STATIONS EMPLOYEES’ MOTIVATION.doc

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UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business
----------------------------
Nguyen Cao Duc
IMPROVING PETROL STATIONS EMPLOYEES’ MOTIVATION:
A STUDY OF PETROVIETNAM OIL CORPORATION
MASTER OF BUSINESS ADMINISTRATION

UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business
------------------------------
Nguyen Cao Duc
IMPROVING PETROL STATIONS EMPLOYEES’ MOTIVATION:
A STUDY OF PETROVIETNAM OIL CORPORATION
MASTER OF BUSINESS ADMINISTRATION
SUPERVISOR: Dr. Nguyen Thi Mai Trang

Executive summary
Many researches recently have show that: motivation of employees play a very
important role in business activity. They have pointed out: if the level of motivation is
high, the employee can perform better, the worker can get higher productivity and the
company can achieve business goal and objective effectively. On the opposite, if the
motivational level is low, it could lead to low sales performance, it may weaken the
company performance and thus it can affect business success.
Understanding the significant role of employee motivation, the objective of this thesis
was (1) to find out the impact of employee motivation on organization effectiveness and
productivity, (2) to identify what factors motivating employees at PetrolVietnam Oil
Corporation’s (in short, it would be called PVOIL in this thesis) petrol stations and
examine the major factors that increase motivation of employees the most.
After carefully reviewing many theory regarding employee motivation, I found that:
there are many factors that motivate employees, including both financial factors and
non-financial factors. There exists a strong relationship between employees’ motivation
and organizational effectiveness. The more motivated the employees are, the more
contribution they bring, thus the more profitable and successful is the business.
The findings of the study revealed that financial factors plays the most important role in
motivating employees at PVOIL petrol stations. The findings are discussed in details in
the research along with suggestions for PVOIL and managers/leaders at PVOIL in order
to increase the employee’s motivational level.

Acknowledgements
I would especially like to show my gratefulness and special thanks to my supervisor –
Dr. Nguyen Thi Mai Trang for all her continuous supports, advices and instructions
through the process of researching and writing this thesis. Without her enthusiastic
help, this thesis could not have been accomplished.
I also would like to show my gratitude to ISB lecturers, my colleagues at work, my
classmates at ISB for their valuable knowledge and continuous support. I also send my
sincere thankfulness to my family for their support and encouragement throughout my
years of study.

TABLE OF CONTENTS
Executive summary
Acknowledgements
1. INTRODUCTION....................................................................................................................................1
1.1. Company background.....................................................................................................................1
1.2 Company structure, mission and vision...................................................................................1
2. PROBLEM CONTEXT.........................................................................................................................4
2.1 The labor productivity and motivation in Vietnam.............................................................4
2.2. The labor productivity at petrol stations owned by PVOIL...........................................7
2.3. Situations of workers at petrol stations owned by PVOIL............................................9
3. PROBLEM VALIDATION.............................................................................................................. 14
3.1 Payment and welfare policy....................................................................................................... 15
3.2 Working condition and environment ..................................................................................... 17
3.3 Promotion and career policy...................................................................................................... 18
4. CAUSE - EFFECT MAP ................................................................................................................... 19
5. CAUSE VALIDATION ..................................................................................................................... 20
6. ALTERNATIVE SOLUTIONS...................................................................................................... 27
6.1. The first alternative solution: Welfare programmes for petrol stations
employees ......................................................................................................................................... 27
6.2. The second alternative solution: Fair payment policy .................................................. 28
6.3. The third alternative solution: Long-time contribution recognition in payment
policy .................................................................................................................................................. 30
7. ORGANIZATION OF ACTIONS................................................................................................. 32
8. CONCLUSION ...................................................................................................................................... 35
9. SUPPORTING INFORMATION .................................................................................................. 36
APPENDICES.............................................................................................................................................. 45
REFERENCES ............................................................................................................................................ 48

LIST OF FIGURES
Figure 1. PVOIL organizational structure.............................................................................................1
Figure 2. Hertzberg's Two Factor Theory .............................................................................................6
Figure 3. Number of workers at petrol stations owned by PVOIL.............................................9
Figure 4. Educational level of workers at petrol stations owned by PVOIL ...................... 10
Figure 5. Age classification of workers at PVOIL petrol stations in 2016.......................... 11
Figure 6. Working time for PVOIL of workers at petrol stations up to 2016 .................... 12
Figure 7. Number of newly- recruited of workers at PVOIL petrol station........................ 14
Figure 8. Cause-effect map....................................................................................................................... 19
Figure 9. Self-evaluate the motivational level by employee...................................................... 22
Figure 10. Factors affecting workers motivation ..................................................................... 23-24
LIST OF TABLES
Table 1. Statistics petrol stations owned by PVOIL from 2008 to 2016 .................................2
Table 2. Labor productivity by industry from 2014 to 2016.........................................................4
Table 3. Labor productivity of petroleum industry from 2014 to 2016 ...................................5
Table 4. Statistics of market share and quantity of petrol stations in 2016............................8
Table 5. Sales volume at petrol stations owned by Petrolimex and PVOIL in 2016 .........8
Table 6. Labor productivity at PVOIL and Petrolimex petrol stations.....................................9
Table 7. Average income of workers at petrol stations................................................................ 13
Table 8. Action plan to improve employee motivation................................................................ 34

1
1. INTRODUCTION
1.1. Company background
PetroVietnam Oil Corporation (PVOIL) is a State-owned Enterprise, established in
2008 with five main functions: Crude Oil Import – Export, International Crude Oil
Trading, Petroleum Products Trading in Domestic (both whole and retail) and
International Marketplaces, Petroleum Products Processing and Bio-fuel Processing and
Distribution. PVOIL’s capital 550 million USD; turnover 2,5 billion USD. Now, it
ranks number 2 among oil distributors in Vietnam with its market share is around 22%
(the market is controlled by Petrolimex with 50% market share and Petrolimex is also
the biggest competitor of PVOIL).
1.2. Company structure, mission and vision
Figure 1. PVOIL organizational structure
(Source: PVOIL)

2
At present, PVOIL has more than 3.000 petrol stations, include above 500 COCO
(Company Owned –Company Operated) petrol stations and more than 2.500 DODO
(Dealer owned-Dealer Operated) petrol stations. The number of employees is around
6.000, include 2.500 workers (direct labor force at petrol stations that PVOIL owned)
and 3.500 staff officers.
Total quantity of petroleum distribution (via 3 channel of wholesale to agents, business-
to-business contracts (B2B) and retail sales) achieves 3,2 – 3,5 millions m3/ton per
year. With the mission “PVOIL consistently pursues valuable goals in life” and the
vision “PVOIL is to become a leading brand name in Vietnam”, in the future, PVOIL
aims to expand its share of the domestic oil and petrol retail market from 22 percent to
at least 35 percent by 2020 through increasing number of petrol stations. To achieve
this target, Mr Cao Hoai Duong, General Director of PVOIL shared that:
Sales retail through channel of petrol stations always play the most important role in our sales
strategy. 75 percent total revenue of PVOIL come from retail sales. PVOIL continues seeking
to increase its number of petrol stations nationwide, especially in small cities and rural areas
along with taking many solutions to increase the sales performance at petrol stations.
Table 1. Statistics petrol stations owned by PVOIL from 2008 to 2016.
2008 2009 2010 2011 2012 2013 2014 2015 2016
Number of
82 100 105 243 312 344 464 485 500
petrol stations
% Growth 22% 5% 131% 28% 10% 35% 5% 3%
(Source: PVOIL)
As can be seen from the Table above, the number of petrol stations owned by PVOIL
increased year by year for the period 2008 – 2016. After 8 years, the number of petrol
stations in 2016 is 6 times bigger than in 2008. PVOIL focus on developing the number
of petrol station nationwide because the retail sales of petroleum products to end-users at
petrol stations plays the most important role in bringing the highest profit and ensuring

the sustainable development for business.

3
All the daily retail at petrol stations of PVOIL is undertaken by the direct labor
workforce-workers. They are front-line employees who contact first with the customers
with their duty is selling products. However, according to the statistics shown in the
company’s report, the labor productivity of workers at petrol stations owned by PVOIL
has a very poor performance compared with the labor productivity of its rival –
Petrolimex.
Ofelia Robescu1
addressed that motivating employees became today an important
objective for organizations that want to remain viable on the market today. Motivation
of human resources in the organization will bring extra performance to the manager that
hopes to reach the organization's goals.
With 50 petrol stations based in Ho Chi Minh City (only 10% total number of PVOIL
petrol stations nationwide), Ho Chi Minh City is one of the most important market in
Vietnam for PVOIL where take account for more than 20% of its sales volume nationwide.
PVOIL always has to face with severe competition from other big oil companies in this key
market. Although the workload of workers at petrol stations in big city like Ho Chi Minh
City often face with many difficulties than others in the remote area, such as: high work
pressure due to the continuously sales activity, unhealthy working environment, narrow
working space, … but there’s seem to be no difference in interests and benefits of these
workers compared with other places. Understanding the important role of Ho Chi Minh city
market as well as the role of retail sales at petrol station, in this thesis, the motivation of
workers at petrol stations located in Ho Chi Minh City center district owned by PVOIL will
be the main objects of the study and to find what affected the motivation of workers will
help to improve the sales performance and labor productivity of workers at petrol stations
owned by PVOIL.

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2. PROBLEM CONTEXT
2.1. The labor productivity and motivation in Vietnam
According to statistics form General Statistics Office of Vietnam, for the period from
2014 to 2015, the average growth rate of labor productivity is about 6,9 %/year. In the
three main sectors of the economy, Agriculture, forestry and fishery has the lowest
labor productivity, Industrial and construction has the highest labor productivity.
Within Industrial and construction sector, the mining and quarrying has labor
productivity 14 times bigger than the average labor productivity of sector.
Table 2. Labor productivity by industry from 2014 to 2016.
Unit: VND million/person
2016
113 1549
120
33
2015
96 1696
115
31
2014
90 1,683
116
29
2014 2015 2016
Mining and quarrying 1,683 1696 1549
Services 90 96 113
Industrial and construction 116 115 120
Agriculture, forestry and fishing 29 31 33
(Source : General Statistics Office of Vietnam)
For petroleum industry in Vietnam, in recent years, petroleum industry always has the
highest contribution to GDP of Vietnam (take account for around 18% of GDP), thus the
labor productivity of petroleum industry always take the leading position nationwide.
However, due to the negative effect from the fluctuation of the world oil price from 2014 to
2016 (the oil price averaged $40.68 per barrel in 2016, down from $49.49/bbl in 2015 and
$96.29/bbl in 2014), the revenue of petroleum industry in Vietnam (mainly come

5
from exporting crude oil and selling petroleum products in domestic market) had to
suffer a decrease for three consecutive year 2014 to 2016.
Table 3. Labor productivity of petroleum industry from 2014 to 2016.
2014 2015 2016
Revenue (VND bil) 745.000 560.000 452.500
Number of laborers (people) 70.200 70.000 69.600
Labor productivity (VND bil/person) 10,6 8,0 6,5
(Source : Vietnam National Oil and Gas Group)
As can be seen from the above table, due to the negative effect from the fluctuation of
the world oil price, the revenue of petroleum industry had to suffer a decrease for three
consecutive year 2014 to 2016. Labour productivity is concerned with the amount or
volume of output (revenue) that is obtained from each employee. Labor productivity is
calculated by using the formula:
Labor productivity = Revenue per period
Number of employees at work
Thus, the labor productivity of petroleum industry in Vietnam has a downward trend
respectively from 2014 to 2016 with a rate of 21,6%/year. The productive use of labour
has a closely link to business efficiency and profitability. Labour productivity need to
be regularly measured and monitored to remain competitiveness of a business.
Regarding the problem of changing in labor productivity, Vietnam National
Productivity Institute (VNPI) indicated in Vietnam Productivity Report 2015 2
that
there is a wide range of the fundamental factors driving Vietnam’s labor productivity,
namely structural change, labor quality, labor market flexibility, facility and
infrastructure investment and scientific and technological development. In addition to
these factors, report from VNPI also confirmed the prominent role of the Productivity
Motivation, Productivity Motivation Programs and support activities to boost labor
productivity in the business sector.

6
To better understand employee motivation, Frederick Herzberg 3
found that the factors
causing job satisfaction were different from those causing job dissatisfaction. He
developed the set of conditions or job characteristics – called Hygiene Factors – prevent
employee dissatisfaction at work, while another set of conditions or job characteristics –
called Motivator Factors – lead to employee motivation.
Figure 2. Hertzberg's Two Factor Theory
(Source: http://wiki.engageeducation.org.au)
So, the ideal solution for employees to do their best are highly motivated and have few
complaints by the combination of both “High Hygiene” and “High Motivation”.
There are many factors affecting the employee motivation in an organization. Ofelia
Robescu et al. 1
also indicated that there is strong support for addressing in which the
money is priority and is an economic factor motivating of human. Ms. Nguyen Thi
Hong Nhung – Human Resources Deputy Manager at PVOIL stated that:
For every employees, salary and welfare policy are always their top concern because this is
their main income. Employees will easily have intention to neglect their duties, to have no
motivation or even to quit their job if their wages are not enough to cover their daily
expenditure and support their family.

7
Besides, workers’ motivation is also affected by working condition and environment.
Mahdi Golara4
indicated that employees in oil and gas companies exposed to various
chemicals and gases produced and used in various segments of activities. These
chemicals and gases caused for occupational diseases of the lungs, skin and other
organs, depending on the duration of exposures. The employees of oil and Gas
Company are facing dizziness, problem of headaches, drowsiness and nausea. These
occupational diseases not only affects the health of the employee but also affects their
family and social life, which includes unsatisfactory or disharmony marital life; and
cumulative stress trauma. The employees of oil and Gas Company are associated with
poorer psychological wellbeing or health, this is to say that the employees tend to
experience high level of stress and depression, dissatisfaction towards job and also
sleep disorders. Thus, workers (the direct labor workforce) often complaint about their
working environment and condition at workplace. Mr Truong Thanh Long-Deputy sales
Manager at Safety-Quality Management Department of PVOIL shared that:
Petroleum products are categorized as a dangerous and toxic products and have many negative
effect on human health. For petroleum company, there is clear and heavy affection of working
condition and environment on employees’ health and thus, their motivation.
2.2. The labor productivity at petrol stations owned by PVOIL
In Vietnam, with the participation of 29 oil distributors, the retail market for petroleum
becomes more and more competitive than ever.

8
Table 4. Statistics of market share and Quantity of petrol stations in 2016.
Oil distributor
Market Quantity of Total sales Average sales volume per
share petrol stations volume (m3) petrol station (m3)
Petrolimex 50% 5.200 8.300.000 1.600
PVOIL 22% 3.000 3.300.000 1.100
Saigon Petro 6% 1.000 1.000.000 1.000
Thalexim 5% 1.150 1.000.000 870
Mipec 5% 698 1.000.000 1.430
Others 12% 1,752 2.200.000 1.250
Total 100% 12.800 16.800.000 1.310
(Source : Petrolimex, PVOIL, Saigon Petro, Thalexim, Mipec)
PVOIL always wants to make its market share higher and higher by many solutions,
one of them is expanding the number and network of petrol stations. However, paying
too much attention to develop “the rapid quantity” has made “the quality” or the sales
performance of each petrol stations of PVOIL not get the expected result.
Table 5. Sales volume at petrol stations owned by Petrolimex and PVOIL in 2016
Company Quantity
Sales Average sales volume Average sales volume
volume (m3) per petrol station (m3) per month (m3)
(1) (2) (3) (4) = (3) / (2) (5) = (4)/12
Petrolimex 2.500 5.000.000 2.000 167
PVOIL 500 600.000 1.200 100
(Source : PVOIL, Petrolimex)
As can be seen from Table above, the average sales volume per petrol station of PVOIL
in 2016 is around 100 m3/month. If compared with the average sales of Petrolimex is
around 167 m3/month, the sales volume of PVOIL is just only take account for 67% of
the rival. Ms Le Quynh Trang, Deputy manager at Petroleum products trading
Department of PVOIL indicated that:
Although, the number of our petrol stations increase year by year, the sales volume is not as our
expectation. We see that petrol stations can reach break-even point if only it’s sales volume is
more than 100 m3/month. But, among 500 petrol station owned by PVOIL up to 2016, there is
only 34% or 170 petrol stations reach break-even or make profit (sale volume equal or more

9
than 100 m3/month), the rest with 330 petrol stations (take account for 66%) is not effective
(sales volume under 100 m3/month).
Along with the low sales performance as can be seen above, the labor productivity of
workers at petrol stations owned by PVOIL is very poor too compared with its rival:
Table 6. Labor productivity at PVOIL and Petrolimex petrol stations.
Unit: m3/worker/month
Labor productivity 2012 2013 2014 2015 2016 Average
Petrolimex 28,0 29,1 30,5 33,2 34,3 31
PVOIL 13,4 17,0 15,4 18,2 20,6 16,9
% PVOIL vs Petrolimex 48% 58% 50% 55% 60% 55%
(Source : PVOIL, Petrolimex)
The poor average labor productivity of staffs at PVOIL’s petrol station is just 16,9
m3/worker/month, take account for 55% of Petrolimex with 31 m3/worker/month. There
are many factors that lead to the poor sales performance of employees at PVOIL petrol
station.
2.3. Situations of workers at petrol stations owned by PVOIL
1040 1100 1125
675 765
Female
935
1260 1300 1375
825 Male
2012 2013 2014 2015 2016
Female 675 765 1040 1100 1125
Male 825 935 1260 1300 1375
Figure 3. Number of workers at petrol stations owned by PVOIL
(Source : PVOIL)
Based on the figure from Human Resources Department of PVOIL, the number of
workers at petrol stations during the period from 2012 to 2016 increase year by year. The
increase in the workforce is a result of expanding the market share by opening many new
petrol stations. The number of female workers take account for around 45% the total
workers at the petrol stations. One special thing about the human policy at PVOIL petrol

10
station is that: 100% head of petrol station (person in charge of petrol station) are male,
not female.
Less than high school
480
500
460
High school or
equivalent
340
300
Technical school or 1495 1560 1625
Some College
975
1105
Bachelor's degree
180 204 276 288 300
69 72 75
45 51
2012 2013 2014 2015 2016
Less than high school 300 340 460 480 500
High school or equivalent 975 1105 1495 1560 1625
Technical school or Some College 180 204 276 288 300
Bachelor's degree 45 51 69 72 75
Figure 4. Educational level of workers at petrol stations owned by PVOIL
(Source : PVOIL)
Alam Sageer5
indicated that education plays a significant determinant of employee
satisfaction as it provides an opportunity for developing one’s personality. Education
develops and improvises individual wisdom and evaluation process. The highly
educated employees can understand the situation and assess it positively as they possess
persistence, rationality and thinking power.
Regarding the education of workers at PVOIL petrol station, as can be seen from table
above, most of the workers have low qualification: 85% of workers graduated high school
or less than high school, only 12% workers were trained at the technical school or college
and very small number of workers (with 3%) have Bachelor’s degree. According to the
human resources policy of PVOIL, except the leader of petrol stations must have a College
degree or above, other positions at PVOIL petrol station do not require high diploma.
However, due to the large number of workers having low qualification, it may

11
cost a lot of money for PVOIL to train them to achieved the required skills at work
place, such as communication skill with customers or safety policy.
Ms. Nguyen Thi Hong Nhung – Human Resources Deputy Manager at PVOIL
informed that:
When interviewing, we clearly stated that we do not pay much attention to diploma for the
position of workers at petrol station. But many people with good education background
accept to become a workers at petrol stations. Maybe, they want a temporary job to support
their life or maybe they wish to have opportunity to get higher position with their good
working performance and diploma after working as a workers for a time.
Age >50
Age from 41-50
2%
4%
Age from 18-24
15%
Age from 33-40
Age from 25-32
45%
34%
Figure 5. Age classification of workers at PVOIL petrol stations in 2016
(Source : PVOIL)
Regarding the average age of workers as showed in Figure above, about haft of the
workers are ranging from 18-32, 45% of the workers are from 33-40, and only 6% of
the workers are over 41. It can be seen that, most of workers at petrol stations are
young. This’s maybe the fact, only young people are healthy enough to work at the
petrol stations because they have to work under unhealthy, toxic environment everyday.

12
≥ 8 years From 4
- 7 years From 2
- 4 years From 1
- 2 years < 1
year
25
150
775
1050
500
0 200 400 600 800 1000 1200
< 1 year From 1 - 2 years From 2 - 4 years From 4 - 7 years ≥ 8 years
2016 500 1050 775 150 25
Figure 6. Working time for PVOIL of workers at petrol stations up to 2016
(Source : PVOIL)
In figure above, thee large number of workers, taking account for 62%, with around 1.550
people, have been working at petrol station for no more than 2 years, 31% (with 775
people) have 2-4 years working at petrol stations and 6% (with 150 people) have 4-7 years
experience, and especially with only 1% (25 people) have been working at petrol station
from the date of PVOIL establishment. The short time working at petrol stations show that,
these workers have no retention. This can be seen that, most of the workers have very few
motivation and no intention to work at petrol station for a long time.
The consequence of this shortage retaining workers is becoming one of a major concern
for PVOIL company. Retention can not be achieved without motivation. Ms. Nguyen
Thi Hong Nhung – Human Resources Deputy Manager at PVOIL told that:
We made a statistic based on the data collected from year 2014 to year 2016, we see that
turnover rate on the rise, the average employee turnover rate is 18%. The consequence is
that we have to pay more money for training newly-recruited workers, thus this lead to an
increase in operational cost increase.

13
Table 7. Average income of workers at petrol stations.
Unit: VND million/person/month
Company Position at petrol station 2012 2013 2014 2015 2016
PVOIL
Manager 9,2 8,0 8,0 8,0 8,0
Worker 7,8 6,6 6,5 6,5 6,5
Petrolimex
Manager 8,2 8,5 9,3 9,5 10,2
Worker 6,8 7,2 7,6 8,1 8,5
(Source : PVOIL, Petrolimex, SaigonPetro)
As above mentions, wages is always the biggest concern of employee at PVOIL. At the
time of 2012, the average income of workers at PVOIL petrol stations was good. Table
7 shows that: during the period 2012 to 2016, the income of employee at Petrolimex’s
petrol station had a tendency to go up, while the income of employee at PVOIL’s petrol
station had a tendency to go down and remained unchanged. Since 2013, PVOIL applied
the new payment policy, in which there was a big decrease in the income of workers. The
new policy payment is based on the position of employees, regardless the qualification,
working experience, time working for PVOIL or the place of living.
Ms. Nguyen Thi Hong Nhung – Human Resources Deputy Manager at PVOIL shared
that:
The new payment policy in 2013 had caused a big concern for workers at petrol stations.
Many workers said that the payment policy is unfair, not competitive and lack of
recognition their contribution in the past and slippage in prices.
If compare with the income of Petrolimex and SaigonPetro for the same position, the
income of PVOIL is lower than around 18-20%. The income of workers at PVOIL is just
the same at the income of labor in other industries (the average income of employed
workers in State sector is around 6 million VND/month in 2016- General Statistics Office
of Vietnam) while they have to work under pressure and unhealthy environment. A lot of
workers felt disappointed and lack of working motivation. This have a negative

14
affection on the number of newly-recruited workers at PVOIL petrol stations from 2012
to 2016 as below.
Ms Vu Anh Tho - staff at PVOIL petrol stations shared that said that:
We feel that we have no recognition from manager. We also feel no satisfy with new
payment policy. Besides, we often feel tired during working hours at petrol station and we
also have occupational disease. We often feel trouble under and no work-life balance. We
have no time for family.
600
345
175
180 195 210
160
105
75
45
Number of
workers recruited
to replace for
workers quited
their jobs
Number of workers
recruited for newly-
established petrol
stations
Linear (Number of
workers recruited to
replace for workers
quited their jobs)
2012 2013 2014 2015 2016
Figure 7. Number of newly- recruited of workers at PVOIL petrol station
(Source : PVOIL)
As can be seen from the Figure above, since 2013, due to the newly-applied policy
payment and due to the lack of motivation, the number of workers at petrol stations
quitted their job increased year by year. And this problem has a tendency to go up. The
Humane Resources Department of PVOIL have to recruit workers not only for newly-
established petrol stations but also for replacing workers who did quit their job.
3. PROBLEM VALIDATION
Zahra 6
stated that employees are the worthy assets of any organization. Achieving the
objectives of any organization depends on the intelligent management of these worthy
sources. Workforce is the important and effective factor of productivity. If these forces
have full confidence and strong motivation, they will reach the productivity to its highest

15
level. Generally, the most important factor that is effective in labor productivity is
motivation in performing the works.
Srivastava et al. 7
indicated that most workers are not satisfied and motivated in their
jobs. Workers are motivated to perform well when the work is meaningful and
individuals believe they have responsibility for the outcomes of their assigned tasks.
Motivational factors influence the productivity are: Intrinsic/Extrinsic Motivation,
Cognition and Environment.
So, it is very important to identify the reasons for low motivations of employees at
PVOIL petrol station. Initial interviews are conducted with 2 groups: Managers at the
head office of PVOIL and Workers at PVOIL petrol stations. After interviewing and
combining with examining relevant literatures on motivation, the key potential problem
affecting the motivations workers at PVOIL petrol station are:
- Payment and welfare policy.
- Working condition and environment.
- Promotion and career development.
3.1. Payment and welfare policy
Akmal Umar 8
indicated that wage significant affects on work motivation. The higher
wages received by workers, then the workers' work motivation is likely to increase.
Motivation significantly affect performance. The higher the perceived work motivation
of workers, the performance of workers is likely to increase. The higher the perceived
job satisfaction of workers, then the workers' work motivation is likely to increase.
The payment policy of PVOIL that applied for employees is now based on the Key
Performance Index, it means the salary is fix for a position. It will be changed if only
you are promoted to the higher position. It means that the policy is regardless of the
degree, working experience, time working for PVOIL or the place of living. Ms. Vu
Anh Tho – staff at PVOIL petrol stations shared that:

16
The problem is that, the new payment policy make my salary lower than in the past. I
receive nothing just the salary. In the past, my salary was consider to raise after two or
three years, but now, the this will not happen. It is very difficult for me to support my
family. I feel so disappointed and lack of motivation.
Fapohunda 9
explores the connection between work life balance practices and
organizational productivity and whether work life balance practices possibly decreases
employee turnover and absenteeism. Work-life balance it is not a quandary to be
determined once but a constant concern to be managed. For organization goals to be
achieved through the people employed, work-life balance concerns must become a
crucial feature of human resource policy and strategy. Management must build a
profound endorsement of people and their roles, to fashion a satisfying, extraordinary
and self-motivated work environment.
For workers at PVOIL petrol stations, due to the characteristic of job, they have no
welfare policy as people at the office, such as: yearly vacation. Mr Luu Xuan Bac, head
at PVOIL petrol station located in Ho Chi Minh city shared that:
We have to work under unhealthy and unsafely environment. We try our best to contribute
for the development of PVOIL but there is no welfare policy for us. We are not allowed to
join in the yearly vacation or year-end party of PVOIL. We feel that PVOIL welfare policy
do not pay a lot attention to us.
Ms Vu Anh Tho, staff at PVOIL petrol station located in Ho Chi Minh city also shared
that:
We have to work day by day, including Sunday and Holidays. As a woman, I feel that I
have a very little time for my family. I have to ask my mother to take care my newly-born
baby for me during my working time. My time at workplace nearly make up my whole
day. I feel it’s hard to balance between my family and my work.

17
3.2. Working condition and environment
Akinyele Samuel Taiwo 10
indicated that employee productivity problems are within
the environment. All efforts targeted toward alleviating employee productivity
problems should be directed at the work environment. Conducive work environment
stimulates creativity of employees that may lead to better methods that would enhance
productivity. Improvement in work environment can lead to higher productivity of
employees and bad working conditions contribute to low productivity of employees. Mr
Truong Thanh Long said that:
Recently, we see that the occupational diseases of workers increase related to lungs, skin, and
other respiratory organs. Employees in oil and gas companies exposed to various chemicals
and gases produced. These chemicals and gases caused for occupational diseases of the lungs,
skin and other organs. This is to say that the employees tend to experience high level of stress
and depression, dissatisfaction towards job and also sleep disorders.
Mahdi Golara 4
indicated that chemicals and gases caused occupational diseases of the
lungs, skin and other organs, depending on the duration of exposures for employees in
oil and gas. Beside, the unhealthy environment, workers at PVOIL petrol station also
have to face with the insecurity at the workplace, such as robbery.
Mr Luu Xuan Bac, head at PVOIL petrol station located in Ho Chi Minh city shared that:
We really feel nervous and insecure when keeping money of petroleum sold at the petrol
station overnight. In the past, there were some robbery and murder at mid-night at other
PVOIL petrol station. Our responsibility regarding keeping money is too big while we
have no rights or no support from company.

18
3.3. Promotion and career policy
Saharuddin, Sulaiman 11
show that the variables of promotion and compensation have
significant and positive impact on job satisfaction, morale and work productivity; job
satisfaction has significant and positive impact on work productivity; and morale has
significant and positive impact on work productivity.
When being asked about the promotion and career development path during the time
working at PVOIL petrol stations, Ms. Vu Anh Tho – staff at PVOIL petrol stations
shared that:
According to normal rule in PVOIL, I know one thing that, only male workers have
opportunity to become head of petrol station. Regardless my effort or contribution, I still
only a staff because I am a woman. Beside, I am just only the temporary worker, there is
no clear promotion path for workers like me.

19
4. CAUSE - EFFECT MAP
For the result of initial interview together with workers’ motivation literatures, the cause-effect is developed as
three main groups as follows:
Working condition
and environment
Unhealthy working
environment
Unsafety working
environment
Payment and welfare
policy
No welfare
programe for
employees at
petrol stations
No work-life
balance Unfair salary
payment
Gender discrimination
in promotion policy
Not know clearly about
necessary conditions for
promotion
No long-time
contribution recognition
in salary payment
Low workers’
motivation
Low
sales volume
outcome
Poor
labor
productivity
Promotion and career
development
Figure 8. Cause-effect map

20
5. CAUSES VALIDATION
Based on the cause and effect tree, interview from 05 respondents divided into 02 main
groups (see Interview guides), secondary data from Human Resources Department, Sales
Department and theories informed, it can be seen that the main causes leading to low
motivation of workers at petrol stations owned by PetroVietnam Oil Corporation are
“Payment and welfare policy” and “Promotion and career development”. It is important
for PetroVietnam Oil Corporation to have action plans to improve this problem
immediately.
Regarding to “Working condition and environment”, this is not an important factor
leading to low motivation of workers at petrol stations. For unhealthy working
environment, although workers at petrol station have to constantly serve customers in a
hazardous environment, but this is one of particularities of this work and it can not
unavoidable. To earn money and support their family, many workers accept this fact as a
normal situation. They are all aware of unhealthy working environment when start
working here. However, environment at petrol stations will be improved based on the
new upcoming regulations of Government to protect the customers, workers and
surrounding air, such as: the needed clear space and safety/green belt at petrol stations
when the authority granting operation certificate for business.
Besides, PVOIL has improved their workplace and provided personal protective equipment
to their workers. PVOIL has policy for caring the health of workers at petrol stations by
supplying facilities (such as: hand gloves, face mask, …) and nutrition (such as: fresh milk).
For unsafely working environment, it seems to be that kind of risk rarely happen because
thanks to the closed cooperation between PVOIL, Bank and local police, PVOIL has applied
many measures to protect their money as well as to improve the security

21
situation at PVOIL petrol stations. It means that kind of factor no longer have influence
on worker motivation.
Mr. Truong Thanh Long-deputy manager in charge of Safety-Quality management also
stated that:
Not only PVOIL but also other oil companies in the market are trying to improve working
conditions for workers at petrol stations by equipping workplace facilities, training
employees on safety regulations and cooperate with Bank, local police to help reduce the risk
of. This issue cannot be solved in short time but need time to examine many aspects to
enhance employee awareness of labor safety and healthy.
In order to validate the main cause, a quantitative research was undertaken with the
purpose of validating the real cause of low motivation of workers at PVOIL petrol
stations. Based on the study dimension and the target market research, in order to ensure
all people who participate in the interview are the holders of knowledge and different
positions (both managers and workers) in the area intend to investigate, 12 interviewees
are workers of PVOIL petrol stations located in Ho Chi Minh City were carefully
selected to take part in the research, and the result as follows:

22
Result Q1
Mean 3.7
Standard Error 0.1421338
Median 4
Mode 4
Standard Deviation 0.492366
Sample Variance 0.2424242
Kurtosis -1.65
Skewness -0.812404
Range 1
Minimum 3
Maximum 4
Sum 44
Count 12
Largest(1) 4
Smallest(1) 3
Confidence Level(95 0.3128344
Figure 9. Self-evaluate the motivational level by employee
(Source : Data collected from Survey questionnaire by author)
When being asked about the level of motivation evaluated by his/herself with 5 level ranging
from “highest motivation level” to “lowest motivation level”, we can see that two-thirds of
the workers (account for 75% respondents) responded that their motivational level is very
low; it mean that they feel unsatisfied with their current job. One-thirds of survey
respondents reveal that their motivational level is neutral, or they feel neutral. Especially,
nobody have “high motivational level” or “highest motivational level”.
When being asked about the level of opinion ranging from “Strongly agree” to “Strongly
dis-agree” regarding factors affecting workers motivation, including:
- Good work-life balance/Flexible work schedule (coding Q2a)
- Job security and stability (coding Q2b)
- Working condition and environment (coding Q2c)
- Learning and development (coding Q2d)
- Career progression (coding Q2e)

23
- Salary, benefit and bonus (coding Q2f)
- Recognition (coding Q2g)
- Continuous learning and development opportunities (coding Q2h)
- Company policy and administration are set clearly and fairly (coding Q2i)
We have the result as follows:

24
Result Q2a Q2b Q2c Q2d Q2e Q2f Q2g Q2h Q2i
Mean 2.5 3.25 3.5 2.5 3.25 1.25 1.7 3.3 1.7
Standard Error 0.1507557 0.1305582 0.1507557 0.1946247 0.1305582 0.1305582 0.1421338 0.1421338 0.1421338
Median 2.5 3 3.5 3 3 1 2 3 2
Mode 2 3 3 3 3 1 2 3 2
Standard Deviation 0.522233 0.452267 0.522233 0.6741999 0.452267 0.452267 0.492366 0.492366 0.492366
Sample Variance 0.2727273 0.2045455 0.2727273 0.4545455 0.2045455 0.2045455 0.2424242 0.2424242 0.2424242
Kurtosis -2.444444 -0.325926 -2.444444 0.352 -0.325926 -0.325926 -1.65 -1.65 -1.65
Skewness 0 1.3266499 0 -1.067933 1.3266499 1.3266499 -0.812404 0.8124038 -0.812404
Range 1 1 1 2 1 1 1 1 1
Minimum 2 3 3 1 3 1 1 3 1
Maximum 3 4 4 3 4 2 2 4 2
Sum 30 39 42 30 39 15 20 40 20
Count 12 12 12 12 12 12 12 12 12
Largest(1) 3 4 4 3 4 2 2 4 2
Smallest(1) 2 3 3 1 3 1 1 3 1
Confidence Level(95 0.331811 0.2873568 0.331811 0.4283662 0.2873568 0.2873568 0.3128344 0.3128344 0.3128344
Figure 10. Factors affecting workers motivation
(Source : Data collected from Survey questionnaire by
author) The data collected show that factors have significant and positive relationships
with the motivation of employees working at the petrol stations are payment, recognition,
company policy and career development.
It can be seen that “Payment and welfare policy” and “Promotion and career
development” are considered as main factors that affect to workers‟ motivation. In these
two factors, “Payment and welfare policy” has the most impact on the motivation of
workers at PVOIL petrol stations because of three main reasons as below.
Firstly, most of the workers who took part in the in-depth interview stated that the key
reason leading to low motivation is related to salary, benefits and recognition. They did
not mention a lot those other factors. Mrs. Nguyen Thi Hong Nhung – deputy manager in
charge of Human resources at PVOIL also agree that point of view on salary, benefits and
recognition has strong role in influencing worker motivation, she state that:

25
We understand the important role of pay and recognition in employee motivation because it
shows a great effect on the performance of employees. It boosts up the efficiency of
employees. We see that workers are motivated to perform well when the work is meaningful
and workers believe they have responsibility for the outcomes of their assigned tasks.
Armstrong 12
indicated that the reward system comprises of financial rewards (Fixed and
variable pay) and employee benefits, which together contain total compensation. The
system also incorporates non-financial rewards (recognition, praise, achievement,
responsibility and personal growth) and in many cases, performance management
processes.
Secondly, most of workers’ income comes from salary to support their life and family.
Therefore, if there are any factors influence their income, it could strongly affect to the
workers’ motivation. Saira Yousaf et al 13
have found that there are different factors that
affect the motivation of employees which can be classified into two categories; financial
and non-financial rewards. Financial resources in PVOIL are often tighter than other
private oil companies in the market, so at PVOIL, money is one of key factors but it may
not be the top primary source of motivation for workers. Our policy will consider benefits
and recognitions as instrument of motivation. Although financial rewards are important
for employee motivation but the importance of non financial rewards cannot even be
discriminated.
Thirdly, it has been found during survey that financial factors (include financial rewards
like pay, salary, bonuses, …), health and life insurance are significant factors that affect
motivation of employees working in organizations. The importance of a motivated
workforce cannot be underestimated in boosting the organizational performance. Besides

26
the financial rewards, the employee expects recognition and appreciation for his efforts
and contribution.
Ms Vu Anh Tho, staff at PVOIL petrol station located in Ho Chi Minh city also shared
that:
Not only financial factors (lime salary, bonus,…) but also non-financial (like training
program, recognition,…) factors has an very important role in our work and our life. We
expect recognition and encouragement for our contribution because nobody like to be
unappreciated for the efforts he or she made.
Currently, PVOIL has recognized “Payment and welfare policy” as the main reason for
low motivation of workers at petrol stations. In the past, PVOIL has applied many
solutions to improve the workers motivation but these measures seem not to be very
effective because of the following reasons:
Firstly, PVOIL has not recognize and identify the main factors for motivating employees
at petrol stations due to employees at petrol station nearly have no chance to share their
concerns, thus the policy of PVOIL cost a lot of money but not very effective.
Secondly, PVOIL has applied the same policy for all of its petrol stations nationwide
regardless the specific characteristics of every location and every territory, such as:
income, standard of living, …
From above points of view, it can be seen that “Payment and Welfare” has the strongest
affection on petrol station employees’ motivation, thus PVOIL needs to focus more on
“Payment and Welfare” policy to improve motivation for workers at petrol stations to
increase sales performance and boost labor productivity.

27
6. ALTERNATIVE SOLUTIONS
Motivation factors may be differing from industry to industry and class to class of
employees such as high level and low level labor. As above analysis, it can be seen that
the main cause of the low motivation of workers at PVOIL petrol stations is “Payment
and welfare policy”. Therefore, this chapter would focus on giving solutions to solve this
main cause. Below would be some alternative solutions applied for improving petrol
station worker motivations
6.1. The first alternative solution: Welfare programmes for Petrol stations
employees
The purpose of employee welfare programs is undertaking measures to ensure the
protection of employees' physical and mental health. The provision of welfare services
enables workers to live in a richer and more satisfactory life and it contributes to the
productivity of labour, efficiency of an enterprise. Employees are the worthy assets of
organization. Thus, they should be treated well. The satisfied employees will help the
company get high productivity. Thus, employees should be treat well.
Almeida 25
indicated that there was a strong positive relationship between two variables
welfare facilities and job satisfaction.
Benefits
- Provide a safe and happy environment that helps employees to prove
themselves and grow along with the company.
- This helps in the creation of a highly satisfied and motivated work force
- Increase the total sales performance and labor productivity.

28
Costs
Description Estimating cost (VND)
1
Yearly health check for workers (=2500 workers x
7.500.000.000
3.000.000 VND)
2 Yearly vacation for workers (=2500 workers x
12.500.000.000
5.000.000 VND)
Total 13.000.000.000
(Estimating cost as mentioned above is based on information provided by HR
Department)
6.2. The second alternative solution: Fair payment policy
Rynes Sara et al 15
indicated that money is ranked at the top for creating motivation
because people require money to fulfill the basic necessities of life so it motivates the
employees more than any other incentive.
Saira Yousaf et al 13
also found that pay must be closely linked to the performance
according to high achievers. Employees who do their best want reasonable pay that
satisfies their needs
The majority of employees expect the enterprise to give them a raise. PVOIL should offer
salary in line with the market or may be a little higher than other oil companies in the
market so that the workers can earn enough to support their family life and for reserve.
Demonstrating fairness and clarity in salary policy is an important factor to arouse
employees’ interest at work.
The bonus policy should be redesigned in a fair, clear and reasonable manner, because it
will create huge excitement for the workers. PVOIL should organize competitions among
petrol stations, among location (rural area vs rual area, urban area vs urban area), among

29
workers and offer rewards to those who complete tasks well. Thereby, workers will try to
work harder, enhancing the store’s profits and business operations. Moreover, at
holidays, there should be gifts and bonuses for employees, although not necessarily high
value incentives. Enterprises also need to show concern for the employees’ family
members by visiting when they are ill; giving award certificates and cash rewards when
employees’ children achieve good academic performance; holding interesting activities
on Children’s Day, Mid-autumn festival; giving lucky money on Tet holidays.
Benefits
- Improve working motivation.
- Encourage and create a positive working environment. Workers can feel
happy, satisfied and comfortable at workplace.
- Creating methods that will encourage and recognize the engagement and
achievement, contribution of workers.
Costs
1 Increase 15% payment for workers at petrol stations
1.875.000.000
(=2500 workers x 7.500.000 VND x 15%)
2 Increase 50% yearly bonus for workers (= 2500
9.375.000.000
workers x 7.500.000 VND x 50%)
Total 11.250.000.000
Department)

30
6.3. The third alternative solution: Long-time contribution recognition in
payment policy
Kashmala Nizam et al 16
showed that Recognition plays an important part for enhancing
employee motivation towards their work by recognizing employees they feel internally
motivated with their job and committed towards organization achievement. Most of the
employees are being motivated as they were properly giving the reward and recognition
for their accomplishments. Performance of the employees indicated significant
relationship with the reward and recognition. The more the employees are motive to tasks
accomplishment higher will the organizational performance and success.
Before, PVOIL has failed to create “promotion and career development” to motivate
employees at petrol stations because PVOIL consider employees at petrol station as
temporary worker, so PVOIL pay no attention to create promotion and career
development policy for them. PVOIL only apply promotion and career development
policy for staffs at the office.
The organizations should plan their set of laws, policies and organizational structures that
give freedom to the employee to work well and value them on their tasks completion and
achievements. Companies should create an atmosphere where employees feel satisfied
and cooperative. Management should give recognition to employees at petrol stations.
Management should do fair dealing with workers. Incentives should be free from bias and
favoritism. Due to this the workers trust would be increased that fair incentives are given
to them.

31
Benefits
- Improve working motivation.
- Identify the needs of workers and help them plan their career path as well
as train and develop them
Costs
1 Expense (cash awards, incentives, bonuses and 18.750.000.000
other payments) for employee recognition, for
example, company awarded each employee a bonus
for 01 month base salary, the total cost budgeted for
rewards is 2500 workers x 7.500.000 VND
Total 18.750.000.000
Department)
As mentioned above, low motivation of employees’ at petrol station is affected by
“Payment and welfare policy”, thus after considering the benefits and cost of each
solution, in order to deal with the impact of both financial and non-financial rewards on
employee motivation, it could be seen that PVOIL should apply the second solution “Fair
payment policy” to improve the motivation of workers at petrol stations because this
solution has the lowest cost.

32
7. ORGANIZATION OF ACTIONS

Luận Văn IMPROVING PETROL STATIONS EMPLOYEES’ MOTIVATION.doc

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