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Improving employee performance always receives researchers and organisational managers' attention as this factor contributes directly to the organisational competitive advantage. Therefore, academic researches, as well as practices, focus on the factors affecting employee performance. However, employer attractiveness, primarily defined as the benefits of an organisation perceived by potential candidates, has not received sufficient attention. Studies regarding employer attractiveness have emphasised on the potential candidates, rather than current employees. Therefore, this study focuses on discovering a new direction - the impact of employer attractiveness on current employees, namely, employee performance. The research method used in this study is the mixed method, especially PLS-SEM analysis tool. Research data is collected from 937 employees from 37 organisations and enterprises in Vietnam. Research results discover the statistically significant relationship between employer attractiveness and employee performance. The results have helped confirm and develop the employer attractiveness factor; especially the new safety value factor.
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Employer Attractiveness and Employee Performance:
An Exploratory Study
Minh Ha Nguyen1, Nguyen Vinh Luan1, Bui Thanh Khoa2
1Ho Chi Minh City Open University, Vietnam
2Industrial University of Ho Chi Minh City, Vietnam
ha.nm@ou.edu.vn; luannv.16ab@ou.edu.vn (corresponding author); buithanhkhoa@iuh.edu.vn
Abstract. Improving employee performance always receives researchers and
organisational managers' attention as this factor contributes directly to the
organisational competitive advantage. Therefore, academic researches, as well as
practices, focus on the factors affecting employee performance. However,
employer attractiveness, primarily defined as the benefits of an organisation
perceived by potential candidates, has not received sufficient attention. Studies
regarding employer attractiveness have emphasised on the potential candidates,
rather than current employees. Therefore, this study focuses on discovering a new
direction - the impact of employer attractiveness on current employees, namely,
employee performance. The research method used in this study is the mixed
method, especially PLS-SEM analysis tool. Research data is collected from 937
employees from 37 organisations and enterprises in Vietnam. Research results
discover the statistically significant relationship between employer attractiveness
and employee performance. The results have helped confirm and develop the
employer attractiveness factor; especially the new safety value factor.
Keywords: Employer attractiveness, employee performance, employer
branding.
ISSN 1816-6075 (Print), 1818-0523 (Online)
Journal of System and Management Sciences
Vol. 11 (2021) No. 1, pp. 97-123
DOI:10.33168/JSMS.2021.0107
Nguyen et al. / Journal of System and Management Sciences Vol. 11 (2021) No. 1, pp. 97-123
98
1. Introduction
In addition to market size and customer loyalty (Khoa at el., 2020), business success
is also measured by corporate management's success, especially in human resource
management. Employee performance, how an employee performs their tasks, is
measured by comparing the task performance to job requirements including the
actual performance (leadership, time management, labour productivity) (Betaubun
et al., 2015). In other words, employee performance is the value chain of the
employee's contribution to the organisation's goal, regardless of whether the
contribution is positive or negative (Harwiki, 2016; Nguyen & Khoa, 2020).
According to Sok and O'Cass (2011), employee's contributions are quantified to
comprise other relevant factors. That employee performance is defined as the
organisation's ability to perform the skills (quality, efficiency and other related
factors at work). It is an especially important and necessary factor because of each
employee's ability to task performance (Masakure, 2016). In the more detailed
approach, Welbourne et al. (1998) assumed that employee performance depends on
the five key employee roles: job, career, innovator, team and organisation; in which:
job refers to job implementation description for each individual, career refers to the
skill implementation essential in organisational progress, innovator refers to work
creativity and innovation, the team demonstrates working ability among other
colleagues and team members to achieve the company's success, organisation
implies how the employee cares about the organisation's goals. Besides, Nguyen
and Ngo (2020) also discovered the positive impact of psychological capital on
employees' work performance. Moreover, Nguyen et al. (2019) also studied the
impact of job crafting on work engagement and work performance.
Unlike employee performance, employer attractiveness is differently defined as
follows. First, employer branding is marketing-like branding for a product or
company (Ambler & Barrow, 1996) or a communication form (Bergstrom et al.,
2002) or management process (Gatewood et al., 1993) or psychology (Jurgensen,
1978; Collin & Steven, 2002) or about employee behaviour (Soutar & Clarke, 1983).
The current widely accepted and used concept is developed by Berthon et al. (2005):
Employer attractiveness, the benefits of an organisation perceived by potential
candidates as the best place to work, includes five dimensions: interesting value,
economic value, social value, developmental value and application value. Following
the definition of Berthon et al. (2005), employer attractiveness has also been
extended to the existing employee object. Employer attractiveness is the perceived
level of both potential employees and current employees about the organisation's
competitive advantages; in which, the organisation is seen as the best place to work.
It will create a long-term and sustainable competitive advantage for enterprises
(Jiang & lle, 2011). Employer attractiveness is divided into Internal employer
attractiveness as the extent to which current employees feel attracted to the
organisation they are working for whereas External employer attractiveness shows
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how attractive the organisation is to potential candidates (Pingle & Sharma, 2013).
In terms of the research stream of the employer attractiveness, employer
attractiveness focuses on a potential employee, rather than the current employee.
Some studies on the impact of employer attractiveness on potential candidates'
applying intentions are listed as Sivertzen et al., 2013; Ha & Luan, 2018). Besides,
the effect of employer attractiveness is studied on organisational satisfaction and
identity (Bodderas et al., 2011). The completely different study is performed on
understanding the branding factors of employers in SMEs (Tumasjan et al., 2011).
The number of studies on the effect of employer attractiveness on current
employees is very limited. Therefore, this study aimed to explore in-depth to clarify
the impact of employer attractiveness on employee performance.
2. Literature Review
The person - organisation fit theory, developed by Kristof (1996), deals with
antecedents and consequences for the organisation and the organisational
individuals. This theory affirms that: to achieve a high level of person - organisation
fit through recruitment and socialisation maintains a flexible condition in the
organisation's difficult situations. This theory aims to clarify and distinguish
between supplementary and complementary fit. The supplementary fit occurs when
a person has 'supplements, embellishes, or possesses characteristics' or other
characteristics similar to another individual in the working environment. This is
different from the complementary fit; a person's personality is 'made whole' on the
environment (Muchinsky & Monahan, 1987). In another explanation, the person-
organisation fit is provided from needs-supplies and demands-abilities (Edwards,
1991). If the analysis from the needs-supplies perspective, the person-organisation
fit will occur when the organisation satisfies the individual's needs and expectations.
On the contrary, the person-organisation fit will occur from the demand-abilities
direction when an individual meets its working capacity requirements.
Employer branding theory is based on the combination of marketing principles
and human management. This concept is seen as the package of both economic and
psychological benefits provided to employees from their organisations (Ambler &
Barrow, 1996). Wally (1989) identifies that employer brand is the first way to create
an organisation's organisational culture and inner spirit in the previous different
approach. These results increase the motivation of the entire organisation to connect
with the employee. Besides, the organisation's reputation will be created for all
stakeholders (Hlavsa et al., 2015). Another foundation of the employer branding
theory is the psychological contract theory that deals with the relationship between
the organisation and employees. According to Hendry and Jenkins (1997), the
psychological contract concept between employees and companies in the traditional
view is the exchange of benefits between the two sides. Accordingly, the employee
will commit to being loyal to the company in return for job safety. However, the
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changing trends in the current period (downsizing, outsourcing and flexibility,
psychological contracts) transformed in a new form. Specifically, the company will
provide the employee with the necessary working skills through training and
development in return for their efforts (Baruch, 2004). In additionally, in terms of
newcomers' negative perceptions, the company can use employer branding to
promote the benefits they can provide to the employee (training, career path and
personal development). In other words, once a company has trouble finding an
employee's solution, the employer branding strategy can be designed to change
company perceptions (Newell & Dopson, 1996; Hendry & Jenkins, 1997).
According to the original concept of employer branding, Ambler and Barrow
(1996) defined three dimensions as employer identity: psychological, functional and
economical. Based on this background, Berthon et al.(2005) researched to develop
three dimensions of employer attractiveness into five dimensions: interest value,
social value, development value, application value and economic value. Economic
benefits represent the economic value, while the psychological benefits are
separated into interest value and social value. Besides, functional benefits are
broken down into development value and application value. It showed that,
according to the reflective model, the employer attractiveness would have a positive
impact on each of its dimensions. Following that, Arachchige and Robertson (2013)
based on previous research and survey results of business students and employees
who worked for businesses in Sri Lankan, developed eight dimensions of employer
attractiveness includes Job structure, Social commitment, Social environment,
Relationships, Personal growth, Organisational Dynamism, Enjoyment, and
Corporate environment. The research results showed a strong similarity between the
perception of the two groups of students and the experienced employee about the
attributes of the employer attractiveness. Job structure and Enjoyment have content
similar to interest value; Social commitment is similar to economic value, social
environment will be similar to application value, relationships, personal growth and
corporate environment factors like social value, organisational dynamism will be
similar to the development value (Berthon et al., 2005). In another study, Roy (2008)
developed additional employer attractiveness dimensions in India's research context.
Accordingly, there are two content that this author added is ethical value and career
opportunity. Specifically, Roy (2008) developed the employer attractiveness scale
including eight factors: Application Value, Interest Value, Ethical Value, Economic
Value, Social Value, Psychological Value, Career Opportunities, and Development
Value.
Meanwhile, Gadibadi (2020) developed two more interesting dimensions related
to startup cases, which are entrepreneurial and Challenge. The dimension
"entrepreneurial" shows development opportunities based on performance
evaluation, taking on different roles, and building a knowledge base through startup
activities. Particularly dimension "challenge" shows challenging, attractive jobs and
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high level of responsibility and authorisation. Besides, through qualitative and
quantitative research to develop and confirm the employer attractiveness scale, this
study added a dimension, safety value. This factor reflects the extent to which an
individual is attracted to job security (Berthon et al., 2005). According to Lazorko
(2019), job security is an important factor that can be communicated to attract
employees. In other words, employer attractiveness will have a positive impact on
safety in an organisation.
Furthermore, Herman and Gioia (2001) also argued that one employer branding
criterion is safety value. Employer attractiveness will have a positive impact on the
safety value of businesses' operations. In summary, the five dimensions model of
employer attractiveness by Berthon et al.(2005) and safety value (added dimension)
has been widely used in studies on employer branding (Roy, 2008; Reis & Braga,
2016; Sivertzen et al., 2013; Biswas & Suar, 2013; Kaur et al., 2015; Arachchige &
Robertson, 2011; Ha and Luan, 2018). Therefore, employer attractiveness was
identified, including the following five factors: social value, development value,
application value, safety value and economic value.
For employee performance, there are many definitions and scales of these factors,
including measures of leadership, time management, productivity (Betaubun et al.,
2015), behaviour (Harwiki, 2016), quality, effectiveness and other relevant effects
(Sok & O'Cass, 2011). However, this study used key elements of Welbourne et
al.(1998) to build key employee performance dimensions, including teamwork,
innovator and job. First, for teamwork, Borman & Motowidlo (1997) and Campbell
(1990) argue that many studies on performance models have teamwork factor as an
important component. Many researchers have confirmed that awareness of the role
of teamwork and its use in organisations has increased in recent years (Stevens &
Campion, 1994). Furthermore, the compensation theory has clearly shown the
importance of teamwork in the organisation through gainsharing plans. The
implementation of gainsharing is seen as the activity of distributing financial
benefits of the business to the entire organisation. Studies have shown that
gainsharing plans and team-related rewards help align members to an organisation
(Welbourne & Cable, 1995). In other words, the payroll system encourages
cooperation among members and between teams. Therefore, the teamwork factor is
very important when evaluating an employee's performance. Secondly, dimension
innovator is also an element of employee performance. A company can only
maintain its competitiveness once its employees can be creative in their overall
operations (Schein, 1980; Khoa & Thai, 2021). People need to have an innovative
methodology to apply in their work and contribute to business performance (Van
Maanen & Scheiri, 1979; Khoa, 2020). In summary, the innovator is important not
only for large firms but also for small firms (Gomez-Mejia & Balkin, 1992). Finally,
the job factor is also a very important component. In the previous studies, the job
and organisation roles were defined as a dimension of work performance. From a
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traditional perspective, the job is seen as a component of employee performance.
Alternatively, in other words, each member's role in an organisation must be similar
to those associated with organisational citizenship behaviours (Organ, 1988).
Besides, Welbourne and Cable (1995) have proven the jobholder role and each
member's role in the organisation. The employee needs to implement both roles in
the working organisation. Furthermore, the job role is supported by the
compensation system. Thus, it can be seen that the job is an essential component of
employee performance. Based on the above, this research has built employee
performance components, including the following three dimensions: Teamwork,
Innovator and Job.
3. Hypothesis and the research model
3.1. Hypothesis
According to Berthon et al. (2005), social value factors attracting employees that
organisations can perform are a happy working environment, fun, friendliness and
teamwork spirit. According to person-organisation fit theory (Kristof, 1996),
companies can provide employees with their needs, including finance, physic,
psychology, and development opportunities. On the contrary, the employee will
provide their values to the company, including effort, commitment, time and
knowledge. Therefore, this is a harmonious relationship. Combining this theory
with the concept of social value by Berthon et al. (2005), the company will provide
social values to attract employees (a friendly, funny, happy and good teamwork
environment). According to the person-organisation fit theory, these values are
similar to psychological factors (Kristof, 1996). When the employer meets the
employee's needs, harmonious relationship-improving employee performance will
be created. Therefore, the social value of employer attractiveness positively impacts
employee performance because the work environment is an important factor in
employee productivity. A good environment will allow employees to work in the
best way with willingness, interaction, creative cooperation, and employees'
satisfaction (Gonzalez, 1999) to improve employee work efficiency (McGuire &
McLaren, 2007). If an organisation maintains a good working environment, the
employee's productivity will increase. In summary, environmental factors and social
value play a very important role in the organisation. Labour productivity or
performance will be increased due to the working environment (Awan & Tahir,
2015).
Developmental value reflects that a potential candidate is attracted by the
recognition, confidence and working experience underpinning career development
(Berthon et al., 2005). According to person-organisation fit theory (Kristof, 1996),
the relationship between employer and employee depends on harmonious standards.
The employee contributes to the company once he is provided with resources
(salary, bonus and perspective). Concurrently, the employee will contribute to the
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employer's values (knowledge, skills, and experience). Employee's contribution
action will create the employee's working efficiency. In other words, the higher the
harmonious relationship between employer and employees reaches, the better the
effect of the impact on the work performance of the organisation becomes.
According to Tziner (1987), the person-organisation fit leaves a long-term impact
on employees' work efficiency, whereas Berthon at el. (2005) believes that
developmental value will give the employees opportunities to create confidence and
experience for future development to attract employees. This developmental value
is similar to the employer's resources to the employees in the person-organisation fit
theory (Kristof, 1996). Hence, developmental value has a positive impact on
employee performance. Awan & Tahir (2015) also argued that the employer
providing training and skill development programs and recognising employee
contributions helps build a good working environment, leading to a positive impact
on employees' efficiency and labour productivity. When the employees get a
quality-training program, they will improve assigned tasks (labour productivity,
working efficiency) (Farooq & Khan, 2011). Besides, Muzaffar et al. (2012)
demonstrated that staff training and development activities, as intangible assets of
each organisation, contribute to improving the employee's multiple skills and
maintaining the employee and its competency systems. Besides, activities create
harmony and uniformity between individuals and organisations to maintain diverse
human resources skills and work efficiency. Based on the above theories and studies,
developmental value is concluded to impact employee performance positively.
Application value shows that potential candidates are attracted by the
opportunities to apply their knowledge to work and teach others, reflecting
humanistic and customer-focused orientation (Berthon et al., 2005). According to
person-organisation fit theory (Kristof, 1996), the relationship between employer
and employee is mutually supportive. In particular, employees need to provide their
values (experience, knowledge, time, effort, commitment and abilities such as tasks,
interpersonal) to the employer. In contrast, the employer will provide employees
with employer resources (financial, physical, and psychological, task-related,
interpersonal and development opportunities). When the communication achieves
the level of harmony, it is known as achieving the person-organisation fit state. The
benefit of the person-organisation fit state is improving employee performance
(Tziner, 1987). Besides, application value includes creating opportunities for
employees to apply their knowledge to work and teaching colleagues (Berthon et al.,
2005). This value's content is similar to that of interpersonal in the person-
organisation fit theory (Kristof, 1996). If combining the theory and definition of
application value, application value positively impacts employee performance.
Furthermore, each member's knowledge management will positively impact
employee productivity (Drucker, 1998; Drucker, 1999). According to knowledge-
employee productivity theory, to improve labour productivity, an organisation can
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implement the following solutions to continuously training, teaching employees,
authorising work, working with requirements that demand both quantity and quality,
awareness of knowledge as an asset, job/tasks based on knowledge. Besides,
knowledge-employee productivity theory comprises knowledge management
systems, knowledge management processes, knowledge management infrastructure
and other related things (Kianto et al., 2016; Kivipõld, 2015; Tseng & Fan, 2011).
In short, knowledge management will have a positive impact on the creativity of the
organisation. The employee can create and use knowledge effectively bypassing
engagement with the organisation's knowledge management implementation.
Accordingly, employees can use knowledge to create benefits when performing jobs
in the most creative, efficient and fast manner (Tseng & Fan, 2011; Nonaka, 1994).
Furthermore, Tseng and Fan (2011) also demonstrated that knowledge management
impacts job performance. Application value is implied to have a positive impact on
employee performance.
According to Berthon et al.(2005), the safety value factor shows that the
organisation's job security attracts an employee. Kartikasari (2017) found the impact
of OSH security facilities on employee performance. In particular, safety factor,
considered a good factor, protects employee in case employee has an accident,
illness or a dangerous problem at work and life. Several companies have used a
hospital or healthcare centre's service to support this activity to feel more confident
in unexpected situations. Simultaneously, once employees feel more secure at work,
they will focus more on their work and ensure work efficiency is more guaranteed.
Sharing this view, Hasibuan (2008) argued that all direct corporate efforts would
help maximise employee performance. Besides, Permanasari (2014) discover that
job safety factor will positively impact employee performance. Brown and Leigh
(1996) find that psychological safety helps improve job involvement and
performance. Because psychological safety will ensure that the company's work
environment is where employees can interact freely and reliably, this favourable
condition is for employees to share their ideas without fear of punishment or
criticism (West, 1990). Indeed, once employees have a good and safe working
environment, they implement proposals, develop and present new ideas, increase
their ability to learn and foster creativity, and create positive work behaviours,
leading to better working efficiency. This result has received much support and
agreement from other researchers. When an organisation provides psychological
safety for the employee, it will receive better working efficiency. Safety is
important at the individual level and at the team and organisation level (Thamhain,
2003; Baer & Frese, 2003; May et al., 2004; Janssen, 2004). Furthermore, recent
empirical studies have shown that high-level psychological safety enhances
employees' creativity, learning and engagement (Lyu, 2016; Edmondson, 1999;
West & Andersen, 1996).
The economic value indicates the degree to which organisations provide potential
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candidates with higher wages, benefits, insurance and promotion opportunities to
attract them to work (Berthon et al., 2005). According to the person - organisation
fit theory (Kristof, 1996), the relationship between employer and employee is a
harmonious one based on fairness. Accordingly, the employer will provide
employees with resources, including values related to financial and economic
factors. On the contrary, the employee will give the employer back values (time,
effort, commitment, experience and capabilities, including tasks, interpersonal);
therefore, leading to increased employee performance. Moreover, financial and
economic values will positively impact employee performance (Tziner, 1987). In
another aspect, employee satisfaction is considered one important factor in
increasing employee's motivation to work. Next, their work motivation will directly
affect their work effort. Work motivation includes both internal and external factors
(Herzberg et al., 1959), in which salary and bonus is the oldest and most important
factor as an effective tool to help employees and their families stabilise their life.
Therefore, managers need to ensure that excellent employees are rewarded in the
form of increased salary. Employee motivation will benefit the company by
bringing about changes and helping the business grow. The management of
compensation is a function of personnel management about salary and bonuses that
employees will receive when performing team duties (Ivancevich, 2003). Salary and
bonuses will help change an employee's work effort (Milkovich & Newman, 1999).
In other words, compensation is a way of distributing economic benefits to
employees' work efforts (Bhattacharyya, 2007). Compensation is provided to the
employee to improve work efficiency and ensure this benefit is controlled at a
reasonable cost (Cassandro, 2008). In summary, the theory and previous studies can
imply that economic value is one explanatory variable for employee performance
(Sajuyigbe et al., 2013; Ojokuku & Sajuyigbe, 2009; Peretomode & Peretomode,
2005).
Based on the above reasons, the hypothesis is proposed as following:
H1: Employer attractiveness has a positive impact on employee performance.
3.2. The research model
According to the concept and scale of employer attractiveness factor developed by
Berthon et al. (2005) and those of employee performance developed by Welbourne
et al.(1998), the study builds the model measurement from the resulting model
(Reflective, Mode A). Besides, according to the research hypothesis, employer
attractiveness is expected to impact employee performance positively. Therefore,
the proposed research model, according to Figure 1, is as follows:
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Employee
Performance
Social
value
Developmental
value
Employer
Attractiveness
Economic
value
Application
value
Teamwork
Safety
value
Job
Innovator
Figure 1. The research model
H1
Fig. 1: The research model.
4. Research Methodology
This research used was a mixed method of qualitative research and quantitative
research. Firstly, the scale adjustment and development is conducted by qualitative
research method. Next, to evaluate the scale's reliability, validity and test research
hypotheses, this study used quantitative research methods. The data collection
methods were used in qualitative research, including expert interviews and focus
group discussion. The expert interview was conducted with four lecturers with a
deep understanding of marketing and human resource management. At the same
time, these professionals also have much experience in corporate management
activities. In focus group discussions, the participants will include employees who
have worked for at least five years to understand the company's employer branding
activities to contribute opinion about the survey questionnaire scales. For the
quantitative research method, the study uses SPPS and PLS-SEM software.
Analytical phases assess the measurement model and the structural model. Data
collection is performed through the survey questionnaires sent directly to the
respondents. After being answered and collected from the respondents, the survey
data will be screened and reviewed to choose which questionnaires meet the
research requirements. The number of respondents who answered the research
satisfactory was 937 people from 37 enterprises and Vietnam organisations. Table 1
shows the demographic information of the sample.
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Table 1: Descriptive statistics results
No.
Content
Frequency
Percentage (%)
I
Gender
1
Male
471
50.3
2
Female
466
49.7
II
Married Status
1
Single
381
40.7
2
Married
556
59.3
III
Age
1
From 18 to 30
491
52.4
2
From 31 to 40
349
37.2
3
From 40 to 50
83
8.9
4
From 50 to 60
14
1.5
IV
Qualification
1
Unskilled
27
2.9
2
Intermediate
180
19.2
3
Colleges
160
17.1
4
University
464
49.5
5
Graduate
106
11.3
V
Job
1
Production/Technical/RD
347
37.0
2
Business
229
24.4
3
Back Office
361
38.5
Total
937
100.0
The scale of all research concepts in this study was based on the previous studies
and qualitative research results. The scales used the 5-pointed Likert scale from (1)
Total disagree to (5) Total agree. In which, employer attractiveness scale was based
on the scale of Berthon et al.(2005) including five factors (social value,
developmental value, application value, safety value, and economic value) and the
scale of employee performance was based on the scale of Welbourne et al.(1998),
including three factors (teamwork, innovator, and job).
5. Data Analysis
5.1. Scale reliability and validity
This research tested the reliability of employer attractiveness, employee
performance scale measurement through Cronbach's Alpha (CA). Simultaneously,
the internal consistency standard of these scales is tested by exploring factor
analysis (EFA). In table 2, all scales met the analytical criteria as follows:
Cronbach's Alpha of all constructs of employer attractiveness and employee
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108
performance were greater than 0.8. Based on this result, all items will be kept in
these two scales. The KMO values of employer attractiveness and employee
performance were 0.948 and 0.931, respectively. Besides, the significant in
Bartlett's test of these scales have a value of 0.000 (< 0.05), proving that these
scales meet the standard of exploratory factor analysis (EFA) (Hair et al., 2017). For
Total Variance Explained index of the employer attractiveness and employee
performance scales, the values of 71.583% and 65.385% are respectively greater
than 50% as prescribed. Therefore, this criterion of both scales is satisfactory
(Gerbing and Anderson, 1988). The eigenvalue of the employer attractiveness
concept (hereafter EA) was 1.024, which showed that the factors include social
value (hereafter SOC), developmental value (hereafter DEV), application value
(hereafter APP), safety value (hereafter SAF) and economic value (hereafter ECO).
The eigenvalue of employee performance concept (hereafter EP) was 1.233, which
shows that the factors on this scale, including teamwork (hereafter TEA), innovator
(hereafter INO) and job (hereafter JOB). That both of these eigenvalue values were
greater than 1.0; hence, the scale meets the standard (Gerbing and Anderson, 1988).
Moreover, two scales have a Composite Reliability (CR) value of greater than
0.70 and an Average Variance Extracted (AVE) value greater than 0.50, and all the
employer attractiveness items' outer loading values have a value from 0.688 to
0.913 as well as employee performance has a value from 0.706 to 0.906, each with a
value greater than 0.708 (Hair et al.,2016). The criteria prove that both scales meet
convergent validity.
Table 2: Results of scale reliability and convergent validity
Constructs
CA
Explore Factor Analysis (EFA)
CR
AVE
KMO
Bartlett's
Test of
Sphericity
Cumulative %
Eigen
values
Employer attractiveness (Outer loading: 0,688 0,913)
SOC
0.911
0.948
0.000
71.583%
1.024
0.931
0.694
DEV
0.902
0.925
0.674
APP
0.832
0.889
0.666
SAF
0.844
0.906
0.764
ECO
0.849
0.908
0.767
Employee performance (Outer loading: 0,706 0,906)
TEA
0.902
0.931
0.000
65.385%
1.233
0.921
0.594
INO
0.898
0.921
0.663
JOB
0.847
0.909
0.768
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One discriminant validity among the latent variables of employer attractiveness is
the Heterotrait - Monotrait (HTMT) standard. Table 3 shows the HTMT values of
all observed variables in the matrix. That all values of HTMT are smaller than 0.85;
hence, the research variables in the model have quite a good discriminant. 2.5% and
97.5% of columns show the low and high 95% confidence interval (the difference
between the calibration and cumulative). The confidence interval does not include 1.
These values proved that the employer attractiveness scales achieved discriminant
validity.
Table 3: HTMT of Employer attractiveness
SOC
DEV
APP
SAF
ECO
O
Bias
2.5%
97.5%
SOC
EAàSOC
0.867
0.000
0.846
0.885
DEV
0.759
EAàDEV
0.908
0.000
0.895
0.921
APP
0.654
0.773
EAàAPP
0.79
0.000
0.755
0.823
SAF
0.687
0.701
0.611
EAàSAF
0.765
0.001
0.727
0.800
ECO
0.605
0.707
0.586
0.594
EAàECO
0.735
-
0.001
0.697
0.768
The study examines the discriminant value among the latent variables of
employee performance. Table 4 shows the HTMT for all pairs of variables studied
in a matrix means that all values of HTMT are much smaller than 0.85. The low and
high limit of the 95% confidence interval (the difference between the calibration
and cumulative) of all groups of research variables does not contain 1.0. These
values assert that employee performance scales achieve discriminant validity.
Table 4: HTMT of Employee performance
TEA
INO
JOB
Beta
Bias
2.5%
97.5%
TEA
EPàTEA
0.907
-0.001
0.89
0.921
INO
0.712
EPàINO
0.873
0.000
0.852
0.891
JOB
0.650
0.649
EPàJOB
0.757
-0.001
0.721
0.787
All groups of scale variables of employer attractiveness (including SOC, DEV,
APP, SAF and ECO latent variables) and employee performance scale (including
TEA, INO and JOB latent variables) achieve internal consistency reliability,
convergent validity and discriminant validity.
5.2. Structural model assessment
The first criterion in evaluating a structural model is the Multi-collinearity test: This
phenomenon occurs when the correlation degree is high among the independent
variables in the linear measurement model., the variance inflation factor (VIF) is
applied to measure this phenomenon (Akinwande et al., 2015). All VIF values of all
Nguyen et al. / Journal of System and Management Sciences Vol. 11 (2021) No. 1, pp. 97-123
110
endogenous variables and the corresponding exogenous variables were 1, which
were less than 2; therefore, multi-collinearity does not occur in research models.
R2 coefficient is used to measure the research model's appropriateness. The
higher value of R2 is, the higher the predictability of the research model becomes.
Besides, in multiple regression models, the studies often use adjusted R2 value to
avoid the deviation caused by complex models. The values R2 and adjusted R2 for
the employee performance are 0.13 and 0.10, respectively. With these adjusted R2
values, the research model's explanation and prediction levels are low. However,
according to Hair et al. (2017), R2 value at 0.2 may be considered high for
behavioural studies. Therefore, this value is acceptable due to employee behaviour,
although this relationship's adjusted R2 value is relatively low.
Also, to evaluate the R2 value of all endogenous variables, the change in the R2
value (when a particular exogenous variable is omitted from the model) can be used
to evaluate whether the omitted variable affects significantly up to endogenous
variables or not. This measurement is called the impact factor f2. By the standard, f2
with values of 0.02, 0.15, and 0.35 would represent small, medium, and large
effects; respectively (Cohen, 1988). f2 value is less than 0.02 demonstrates no effect.
Table 5 shows that EA has an average effect of 0.115 on EP; it showed that EA has
an only medium impact on EP.
Table 5: Effect size
APP
DEV
ECO
EP
EA
INO
JOB
SAF
SOC
TEA
EP
3.202
1.34
4.616
EA
1.649
4.666
1.187
0.115
1.416
3.012
In additionally, the Q2 value is used to assess the importance of R2 values to
assess the accuracy of the prediction, (Geisser, 1974 and Stone, 1974) as an
indicator of the out-of-sample predictive power.
Table 6: Q2 value
SSO
SSE
(=1-SSE/SSO)
APP
3748.00
2227.77
0.406
DEV
5622.00
2528.85
0.550
ECO
2811.00
1661.18
0.409
EMPLOYEE PERFORMANCE
15929.00
15141.63
0.049
EMPLOYER ATTRACTIVENESS
20614.00
20614.00
INO
5622.00
2810.26
0.500
JOB
2811.00
1587.15
0.435
SAF
2811.00
1567.89
0.442
SOC
5622.00
2714.86
0.517
Nguyen et al. / Journal of System and Management Sciences Vol. 11 (2021) No. 1, pp. 97-123
111
SSO
SSE
(=1-SSE/SSO)
TEA
7496.00
3862.88
0.485
When PLS-SEM exhibits the predictive relevance, data that is not used in model
estimation can be correctly predicted. Regarding evaluation criteria, with the
structural model, the value Q2 is greater than 0 for a specific endogenous latent
variable, indicating the path model's predictive relationship for this particular
dependent variable. From Table 6, the value Q2 of endogenous variables is greater
than 0 through blindfolding result. That employee performance has the value of Q2
of 0.049 suggests that the model's predictive relevance to endogenous latent
variables is possible.
Table 7 described the relationship between the research variables and research
hypothesis test. That employer attractiveness has a medium positive impact on
employee performance (β = 0.321) with 99% confidence implies that the hypothesis
is supported. Figure 2 pointed out the relationship between the concepts and
constructs in the research.
Table 7. Hypothesis testing result
O
M
STDEV
|O/STDEV|
P Values
Comment
EA -> EP
0.321
0.324
0.033
9.575
0.000
Supported
Note: Original Sample (O), Sample Mean (M), Standard Deviation (STDEV), T Statistics (|O/STDEV|)
Figure 2. The research results.
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112
6. Discussion
That employer attractiveness positively impacts employee performance with impact
coefficient ß = 0.321 (significance level p-value = 0.000) means that hypothesis H2
is supported. This result helps to add a new research direction of employer
attractiveness because previous studies mainly focus on attracting potential
candidates, especially on candidate recruitment' impact on work efficiency.
Specifically, the previous employer attractiveness researchers pay more attention to
potentially potential candidates (Sivertzen et al.; 2013 and Ha & Luan, 2018) or
employer attractiveness scale (Berthon et al., 2005). Therefore, the relationship
between employer attractiveness and employee performance is affirmed in a new
direction.
Theoretically, this result is consistent with the theory concerned. According to
person-organisation (PO) fit theory (Kristof, 1996), there is harmony between the
company and the employee by providing each other with the benefits and values
that each side wishes to receive. The company will also provide employees with
financial values (economy, physical and psychology as safety or opportunities like
development and application). In contrast, employees will provide the company
with their performance. The optimal relevance is that both satisfy both needs
through the values mentioned above. Therefore, the positive relationship between
employer attractiveness and employee performance is completely consistent with
Person-Organization (PO) fit theory.
Compared to previous studies, this is a new research direction, so not many
studies on this relationship for reference. The first study of Dabirian et al. (2019),
analysing 15,000 IT employee reviews, identified eight values for IT employee
evaluation to propose appropriate solutions for IT, company leaders, to use the
employer brand effectively to attract and retain talent for improving human resource
competitiveness or increasing the efficiency of employees. In another study, Slatten
et al.(2019) found the role of organisational attractiveness as the powerful frontline
in employees' perception of their internal market-oriented culture and turnover rate,
engagement and service quality in hospitals; in which, organisational attractiveness
has a positive impact on the service quality of nurses provided to patients. This
research result is quite similar to that of Slatten et al. (2019). Pires (2020) studied
Employer attractiveness and its impact on individual work performance moderated
by national culture in multinational companies. With regression models, employer
attractiveness dimensions (economic and application value) with a positive
relationship with employee performance. To sum up, the results of the positive
relationship between employer attractiveness and employee performance are rather
relevant.
Practically, the positive effect of employer attractiveness on employee
performance is relevant in practice. Firstly, factors related to the social work
environment (supportive relationship, the collaboration between colleagues, the
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113
smooth coordination between superiors and subordinates, and friendliness in public
work) will make employees more comfortable and think more positively to increase
work motivation and positive impact on their work efficiency. Besides, with mutual
support among colleagues, the work will go more smoothly and quickly because
gathering collective strength will help the work more efficiency. Secondly, when
the company focuses on employee development (DEV), employees can improve
their competencies and solve problems effectively. Thirdly, when the company has
an application value (APP), employees will be able to apply the knowledge they
have learned in their real work to better the efficiency by being performed
methodically and professionally.
Moreover, other colleagues also share new knowledge to improve their work and
improve overall work efficiency. Fourthly, safety factor (SAF) contributes greatly
to employee performance. When employees feel safe at work, they will create peace
of mind and psychological stability to focus all their resources on the job. The
ultimate value is economical (ECO): when the company provides a competitive
salary and benefit, the employee will impact employee motivation so that
employees focus entirely on the work and improve work efficiency greatly. In a
nutshell, employer attractiveness positively impacts employee performance is
completely consistent with the activities occurring in enterprise practices.
7. Conclusion and Managerial Implications
This study on the relationship between attracting employer attractiveness and
employee performance in the Vietnamese context, confirm and adjust the employer
attractiveness scale, and test the effect of employer attractiveness on employee
performance is the new direction of employer attractiveness, emphasising the
impact on current employees. The study uses qualitative and quantitative research
methods to adjust and confirm the employer attractiveness and employee
performance scales. The number of respondents to the survey is 937 from 37
enterprises and organisations in Vietnam. The result has developed a new factor for
the employer attractiveness scale: safety factor (SAF). In summary, the research has
confirmed the employer attractiveness scale including social value: SOC (6 items),
developmental value: DEV (6 items), application value: APP (4 items), safety value:
SAF (3 items) and economic value (3 items). The employee performance scale
includes teamwork: TEA (8 items), innovator: INO (6 items) and job: JOB (3 items).
Besides, the study tests research hypotheses and research models by using SPSS and
PLS-SEM software. The analytical results show that standards on the measurement
model and structural model (according to PLS-SEM) achieved criteria. The results
also show that the factors of employer attractiveness and employee performance
both positively impact its components. In particular, research has found that the
positive effect of employer attractiveness on employee performance has a moderate
degree of impact and 99% confidence.
Nguyen et al. / Journal of System and Management Sciences Vol. 11 (2021) No. 1, pp. 97-123
114
That employer attractiveness positively impacts employee performance directly
with the impact coefficient at an average level of 0.321 confirms the influential role
of employer attractiveness towards potential candidates and current employees. This
result implies that managers can refer to more attractive business values to improve
employee's work efficiency by studying and implementing several policies to apply
employer attractiveness to increase employee performance. Firstly, managers
should build a happy, fun and friendly working environment for social value and a
good relationship among colleagues, between superiors and subordinates. It will
help employees feel comfortable, happy and work more efficiently. Secondly,
managers had better develop a diversified employee training and development
program (career paths, inter-departmental experience experiences, succession
planning, authorisation of work). Simultaneously, building employee development
policy clearly and fairly helps all employees have the opportunity to develop.
Thirdly, managers can enhance organisational learning model to promote internal
training activities and enable employees to share their knowledge and experience
with colleagues. It will help employees feel they have a valuable contribution to the
organisation and a more meaningful life. Fourthly, the company should pay
attention to its employees' safety and physical and mental safety. Managers increase
the effective implementation of EHS (Environment - Health - Safety) strategy to
have good remedial and preventive measures in safe operations. Finally, managers
should pay attention to the effective implementation of salary, bonus and welfare
policies for employees by surveying and referring to the salary levels and salary
payment strategies in the market for appropriate adjustment to be competitive. To
help improve employee performance, managers can promote synchronous social,
developmental, application, safety, and economic factors.
8. Limitations and further research
This study focuses on respondents mostly from businesses operating in Vietnam.
That it is impossible to cover all employees from other types of organisations
(socio-political organisations, culture, media, education, non-government) will
affect data generalisation criteria. Besides, this study uses the non-probability data
collection method (convenient method), so the sample's accuracy and
representativeness have some limitations. Another limitation of the study comes
from the location of data collection: The study only collects survey questionnaires
from respondents living in cities and provinces in the Southern region of Vietnam.
There are differences in culture and customs between regions, leading to the
difference in employee perceptions. This limitation will affect the research data
accuracy, in particular, data generalisation. Finally, since the data collected from
respondents is only available at a time, it is impossible to compare the change in
perception of these respondents overtime series, leading to partly impacted research
results.
Nguyen et al. / Journal of System and Management Sciences Vol. 11 (2021) No. 1, pp. 97-123
115
Therefore, further research can develop more precise and general data collection
methods (using probability data collection method). Besides, study subjects can
expand to non-business organisations (socio-political organisations, culture,
journalism, education, non-government). For the geographical factor, it is possible
to survey more broadly organisations in the Central and Northern regions of
Vietnam for the more general research results. The study time may add some
different times to compare and evaluate the change in employee's perception of
employer attractiveness. Future studies may also expand some intermediate
variables or moderator variables in the relationship between employer attractiveness
and employee performance in terms of the research model. Besides the employee
performance, the next research may discover other dimensions (employee
satisfaction, commitment or loyalty) that employer attractiveness can impact.
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