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

NGUYỄN THANH TÙNG

THE PERSONEL RECRUITMENT OF SMALL AND
MEDIUM ENTERPRISES IN HANOI AREA IN THE
INTERNATIONAL INTEGRATION PERIOD

CÔNG TÁC TUYỂN DỤNG NHÂN LỰC
TẠI CÁC DOANH NGHIỆP VỪA VÀ NHỎ
TRÊN ĐỊA BÀN HÀ NỘI TRONG THỜI KỲ HỘI NHẬP

LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

HÀ NỘI - 2018


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

NGUYỄN THANH TÙNG

THE PERSONEL RECRUITMENT OF SMALL AND
MEDIUM ENTERPRISES IN HANOI AREA IN THE
INTERNATIONAL INTEGRATION PERIOD

CÔNG TÁC TUYỂN DỤNG NHÂN LỰC
TẠI CÁC DOANH NGHIỆP VỪA VÀ NHỎ

acknowledged with the standard of references.
I declare that this is a true copy of my thesis. The content of this thesis has
been approved by the committee of Vietnam National University, Hanoi – Hanoi
School of Business (HSB). This thesis has not been submitted for a higher degree to
any other University or Institution.
In order to finish this project successfully, I have received many helps,
supports and guidance from many people who I would like to thank sincerely.
First of all, I would like to thank all the professors of MBA program,
especially Dr. Trinh Ngoc Huy – my suporvisor. Then I would like to thank deeply
the respondents and interviewees who allowed me to gather enough data for this
research. Finally, I would like to express my thanks to my family, my colleges and
my fellow friends who created convenient conditions and give me encouragement
and understanding for me to complete this degree.
I sincerely thank you!

Hanoi, date of …… / …… /……..


MỤC LỤC

ABBREVIATION ............................................................................................ i
LIST OF FIGURES ........................................................................................ ii
LIST OF TABLES ......................................................................................... iii
INTRODUCTION ........................................................................................... 1
1. Rationale ................................................................................................. 1
2. Aims of research ..................................................................................... 3
3. Objects of research.................................................................................. 3
4. Scope of research .................................................................................... 3
5. Research methodology ............................................................................ 3
6. Thesis structure ....................................................................................... 6

2.4. Selection practices in SMEs ............................................................... 55
2.4.1. The use of application screening and preliminary interviews......... 55
2.4.2. Use of selection tests ....................................................................... 57
2.4.3. The use of interviews ...................................................................... 60
2.4.4. Reference check............................................................................... 62
2.5. The impact of recruitment practice on employees attitude and
performance ................................................................................................. 64
2.5.1. Reliability analysis of dependent variables ..................................... 64
2.5.2. Reliability analysis of recruitment and selection variables ............. 66
2.5.3. Multiple regression analysis ............................................................ 67
CHAPTER 3: IMPLICATIONS AND SUGGESTIONS TO IMPROVE
RECRUITMENT AND SELECTION PRACTICES IN VIETNAM
SMEs ............................................................................................................... 72
3.1. The role of small and medium sized enterprise in Vietnam............... 75
3.2. Human Resource Challenges facing SMEs in Vietnam ..................... 76


3.2.1. Human Resource Planning .............................................................. 76
3.2.2. Job analysis ...................................................................................... 77
3.2.3. Recruitment and selection ............................................................... 77
3.3. Summary of research findings ............................................................ 78
3.3.1. Human resource planning ................................................................ 78
3.3.2. Job analysis ...................................................................................... 79
3.3.3. Sources of candidates ...................................................................... 79
3.3.4. Use of preliminary screening .......................................................... 80
3.3.5. Use of delection test ........................................................................ 80
3.3.6. Use of interviews ............................................................................. 80
3.3.7. Reference check............................................................................... 81
3.4. Suggesttions for SMEs in improving recruitment and selection
practices ....................................................................................................... 81


World Trade Organization

TPP

Trans-Pacific Partnership

GDP

Gross Domestic Product

.

i


LIST OF FIGURES
Figure 1.1. Recruitment and selection process .........................................................14
Figure 1.2. Research model .......................................................................................37
Figure 2.1. Size of enterprises in Vietnam ................................................................40
Figure 2.2. Total number of SMEs by year ...............................................................41
Figure 2.3. Allocation of SMEs in Vietnam by industry ..........................................42
Figure 2.4. Size of the enterprises in the sample ......................................................45
Figure 2.5. Types of the firms in the sample by ownership ......................................46
Figure 2.6. Distribution of firms in the sample by industry......................................46
Figure 2.7. The implementation of HR planning by SMEs ......................................48
Figure 2.8. How often does your company use formal job analysis .........................49
Figure 2.9. The availability of job descriptions and job specification ......................50
Figure 2.10. The use of job descriptions and job specifications for recruitment and
selection .....................................................................................................................52



INTRODUCTION
1. Rationale
Small and medium enterprises (SMEs) typically account for a large
proportion (about 90% numbers of enterprises) worldwide. In Vietnam, this rate at
about 98% so SMEs play a very important role in national economy. While big
enterprises are often located in the economic centers of the country, the SMEs are
present in all locals, regions… and contribute a great deal to government budget,
generate mass of local jobs, and significantly contribute to the national GDP in
value. According to Vietnam General Statistic Office (GSO, 2016), small and
medium enterprises employ 51% social workers and contribute over 40% of GDP
for the country.
In the status of national economic renovation and international integration,
(especially while Vietnam was official member of WTO (2007), TPP (2016) and
lots of important free trade agreements - FTA), Vietnam‟s enterprises (especially
SMEs) catch up several big business opportunities and enormously challenges, vice
versa. Economic researchers and experts affirm that the key visible challenge for
domestic enterprises is the competitive pressure from multinational corporations
and international groups. Under this pressure, SMEs is the mostvulnerable. Because
SMEs are in lack of finance, naturally, have less ability in capital mobilization, and
possess not-good-enough human resource and technology for survival.
Once again, the shortage of highly qualified personnel and skilled workers
are the most worrying problems of SMEs. In addition, the experience of
international market access and understanding of the common conventions and
international charters of SMEs is also very limited. Therefore, innovation and
improvement of business capacities are imperative requirement for SMEs to seek a
position in the market in the current period.The task of innovation and improvement
of business capacities of SMEs are not only focused on the issue of organizational
structure, financial, technical infrastructure ... but also towards the content of human


address as well as telephone numbers of the SMEs were collected from enterprises
database extracted from the website thongtindoanhnghiep.co
-

Design of questionnaires: Questionnaires are designed to be in line with the

objectives of the thesis and theoretical framework in a clear and concise manner. To
ensure accuracy, the questionnaire will be designed according to the following process:


Based on research objectives and frameworks to identify the information

needed: factors, variables and metrics;


Determine the type of question;



Determine the content of each question;



Determine the terms used for each question;



Determine the logic of the questions;


Assess the scale reliability by using the Cronbach Alpha coefficient. Variables
with an item-total correction factor less than 0.3 will be excluded and the criterion of
scale selection is that it has Cronbach Alpha reliability of 0.6 or higher (Nunnally &
Bernstein, 1994). In this study, Cronbach Alpha must be from 0.6 to be retained.
Oneway Anova Analysis
Assumptions for one-way analysis of variance (One-Way Anova):
- Comparative groups should be independent and randomly selected.
- Comparative groups must have standard distribution: use the KolmogorovSmirnov test.
- The variance of the groups should be the same: use the Levene test to look
at the equality of variance. The Levene test was conducted with the hypothesis H0
that the variance of the groups were the same, if the test result for the significance
level was less than 0.05 then rejected the Hypothesis H0.
If one of the above assumptions does not meet, the Kruskal-Wallis nonparametric test will be used instead of ANOVA. Hypothesis:
- H0: There is no difference between the mean of the groups classified by
variables.
- H1: There is a difference between the mean of the groups classified by
variables.
If:
+ Sig. (2-tailed)> 0.05 is not sufficient basis to reject the Hypothesis H0
should accept Hypothesis H0, which means that the average value is different from
the test value.

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+ Sig. (2-tailed)
subjective assessment of the participating companies. The results show the positive
relationship between the five measures of human resource management practices
and the financial results of enterprises including recruitment and selection, training,
performance based pay.
The research by Kauanui, Dang Ngoc Su and Ashley-Cotleur (2005)
explores the relationship between three aspects of human resource management
including training, performance appraisal, and incentive pay. The authors collected
data from 200 SMEs in Hanoi for analysis. Results of the study show that the
positive relationship between the control measures and the results of enterprises in
which the incentive fee has the greatest impact.
Nguyen Tung (2014) in his article on "Human Resource Management
Practices and Performance of Small and Medium Enterprises in Vietnam" has
identified five human resource management teams to be used, including (i)
personnel recruitment channel, (ii) personnel selection, (iii) remuneration and
compensation, (iv) personnel training and development, and (v) personnel
assessment. The results of the standard survey used for the study included 96
randomized enterprises in nine northern provinces, including Hanoi. The total
number of formal employees in each surveyed enterprise was no more than 300.
The author's conclusion is that the application of professional business management
practices in small and medium enterprises in Vietnam is limited to all operations
related to personnel recruitment channels, personnel selection, compensation and

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training, human resources development and training, and personnel assessment.
There are a number of human resource management practices that are new or are
not / are rarely applied in businesses such as recruitment through job fairs
(recruitment channels), psychological tests (selection of candidates), the program
encourages groups and individuals to work, share profits, supplement financial


and

companionship; (5) Compensation for damages and benefits; (6) Performance
evaluation. Finally, the thesis proposes the necessary solutions to improve the
efficiency of production and business activities by improving the efficiency of
human resource management, namely: (1) recruitment and selection: transparent
system should be applied through the assessment of individual capacities; (2) The
training program should continuously update the new skills required for production

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and business activities to meet the challenges of modern competition; (3) In order to
improve the efficiency of production and business activities, small and medium
enterprises should have appropriate career planning systems for employees and
workers; (4) The compensation and reward system for workers should be based on
market prices, which will help retain more qualified employees in the business.
Cuc (2016) studied HRM at small and medium sized enterprises in Vietnam
and found that HRM in these enterprises was still weak and underdevelped. She
found that there are few SMEs planning human resources in the long run.
According to statistics, 85% of total enterprises forecast demand based on the
number of employees to replace, only about 15% is based on changes in science,
technology, demand products and services, scale capital. Even more, many
Vietnamese SME owners have not identified the need for human resources in the
short term. Only medium-sized enterprises (50-300 employees) are interested in and
set up a human resource management strategy. However, human resource training
and development strategies are not closely linked to vision and objectives. Human
resources management, due to the lack of interest in development, in SMEs are not
effective. The author also cited from survey that most Vietnamese SMEs now carry

criterion for SMEs is that the total of employees less than 500.
In Vietnam, there have been many different concepts of small and medium
enterprises. However, since the issuance of Decree No. 90/2001/NĐ-CP dated 23
November 2001 on SME development assistance, the definition of SMEs has been
understood as follows: "Small and medium enterprises are independent business
establishments, having registered business under the current law, with the registered
capital of not more than 10 billion or average number of employees does not exceed
300 employees per year.
Thus, the criteria for determining SME are:
+ Registered capital of less than VND 10 billion (approximately USD
650,000), or
+ Having a workforce of less than 300 people.
According to Article 4: "This Decree applies to SMEs, including: Enterprises
established and operating under the Enterprise Law, Enterprises established and

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operating under the Law on State-owned Enterprises; and operate under the Law on
Cooperatives; Individual business households registered under the Government's
Decree No. 02/2000/ ND-CP of February 3, 2000 "(This Decree is replaced by
Decree 109 / 2004 / ND-CP).
According to Vietnam Chamber of Commerce and Industry:"Small and
micro enterprises are production and business establishments with fewer than 50
employees. Enterprises with 10 to 49 employees are small enterprises, enterprises
with 1 to 9 employees are considered as very small enterprises.
With this concept, medium enterprises are the remaining enterprises in the
concept of Decree No 90, which means that enterprises have between 50 and 299
employees. However, over the past seven years, the SME concept of Decree No. 90
has revealed unreasonable points. "There are enterprises with a workforce that

program is contemplated, one task is to estimate the number of applicants necessary
to fill all vacancies with qualified people. (Heneman, 1986)

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