MINISTRY OF FINANCE ACADEMY OF FINANCE FACULTY OF FOREIGN LANGUAGES -***** - GRADUATION THESIS THE EFFECTS OF CORPORATE CULTURE ON ORGANISATIONAL EFFECTIVENESS AT GENERAL DEPARTMENT OF VIETNAM CUSTOMS VÕ THÙY LINH CQ47/51.03 Hanoi – 2013 MINISTRY OF FINANCE ACADEMY OF FINANCE FACULTY OF FOREIGN LANGUAGES -***** - THE EFFECTS OF COPORATE CULTURE ON ORGANISATIONAL EFFECTIVENESS AT GENERAL DEPARTMENT OF VIETNAM CUSTOMS SUMBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF BACHELOR OF ARTS IN ENGLISH FOR FINANCE AND ACCOUNTING Student Class : Võ Thùy Linh : CQ47/51.03 Supervisor : M.A Trương Thị Minh Hạnh Hanoi - 2013 Graduation thesis Faculty of Foreign Languages DECLARATION I hereby declare that this thesis is based on my own work except for quotations and citations which have been acknowledged I also declare that it has not been submitted for any other course/degree at Academy of Finance or other institutions Hanoi, May 3th 2013 Student‘s name Võ Thùy Linh Võ Thùy Linh i CQ47/51.03 Graduation thesis Faculty of Foreign Languages ABSTRACT Corporate culture contributes to enhance organisational effectiveness at an organisation Corporate culture is a process where norms, values, and coordination and integration characteristics are at play Companies or organisations need to build positive corporate culture not only for running a company but also for enhancing the effectiveness of it It is also significant for a company or an organisation to know who its employees are, how they interract with each other and how they achieve common goals This study examines the characteristics of corporate culture: norms, values, and coordination and integration at the GDVC A questionnaire and interviews are used to collect data about corporate culture and its impacts on the organisational effectiveness at the GDVC The preliminary results of the research show that initially the GDVC with a healthy corporate culture is more confident and motivated The conclusion research results, some recommendations for improving the corporate culture will also can also be drawn a healthy corporate culture positively impacts on the organisational performance Following an in-depth multi-dimentional analysis of preliminary be presented Võ Thùy Linh ii CQ47/51.03 Graduation thesis Faculty of Foreign Languages ACKNOWLEDGEMENTS This graduation thesis would not have been possible without the guidance and the help of several individuals who in one way or another contributed and extended their valuable assistance in the preparation and completion of this study First and foremost, I would like to express my gratitude to my thesis supervisor M.A Trương Thị Minh Hạnh for her inspiring guidance, suggestions and critical evaluation of the work for the successful completion of my thesis Secondly, I would like to give thanks to all lecturers at Academy of Finance for their enthusiasm through the teaching and support process Thirdly, I would like to express my sincere thanks to all staff of the General Department of Vietnam Customs for giving me assistance and corporation that helped me in writing this thesis Last but not least, I would like to thank my family members and friends for their essential encouragement during the process of completing this thesis Hanoi, May 2nd, 2013 Võ Thùy Linh Võ Thùy Linh iii CQ47/51.03 Graduation thesis Faculty of Foreign Languages LIST OF TABLES Figure 2.1 Organisational structure of General Department of Vietnam Customs …………………………………………………………………… 22 Võ Thùy Linh iv CQ47/51.03 Graduation thesis Faculty of Foreign Languages LIST OF ABBREVIATIONS ASA Attraction – Selection – Attrition GDVC General Department of Vietnam Custom IT Information technology M.A Master of Arts Võ Thùy Linh v CQ47/51.03 Graduation thesis Faculty of Foreign Languages TABLE OF CONTENTS DECLARATION i ABSTRACT ii ACKNOWLEDGEMENTS iii LIST OF TABLES iv LIST OF ABBREVIATIONS v TABLE OF CONTENTS…………………………………………… vi INTRODUCTION 1 Rationale Aims of the study Scope of the study Methodology Organisation of the study CHAPTER LITERATURE REVIEW 1.1.Corporate culture 1.1.1 Definition 1.1.2 Characteristics of corporate culture 1.1.2.1 Norms (Behaviors) 1.1.2.2 Values 1.1.2.3 Coordination and Integration 10 Võ Thùy Linh vi CQ47/51.03 Graduation thesis 1.2.The relationship Faculty of Foreign Languages between corporate culture and organisational effectiveness 12 1.2.1 Organisational effectiveness 12 1.2.2 The impacts of corporate culture on organisational effectiveness 13 1.2.2.1 Positive impacts 13 1.2.2.2 Negative impacts 14 1.2.3 Healthy and Unhealthy corporate culture 15 1.2.3.1 Healthy corporate culture 16 1.2.3.2 Unhealthy corporate culture 16 1.2.3.3 Building and maintaining a positive corporate culture 17 CHAPTER 20 THE STUDY 20 2.1.Introduction about the General Department of Vietnam Customs 20 2.1.1 Development history 20 2.1.2.Organisational structure………………………………………….21 2.2.Corporate culture at the GDVC 26 2.2.1 Analyzing Norms at the GDVC 26 2.2.2 Analyzing Values at the GDVC 29 2.2.3 Analyzing Coordination and Integration at the GDVC 31 2.2.4 The influences of corporate culture on organisational effectiveness at the GDVC 34 2.3.Mini conclusion 35 Võ Thùy Linh vii CQ47/51.03 Graduation thesis Faculty of Foreign Languages CHAPTER 36 RECOMMENDATIONS 36 3.1.Summary of the findings 36 3.2.Suggestions for improving the corporate culture at the GDVC 37 CONCLUSION 42 REFERENCES 43 APPENDIX 45 Võ Thùy Linh viii CQ47/51.03 Graduation thesis Faculty of Foreign Languages culture, which does not have a large impact on the effectiveness of organisation at the GDVC 2.3 Mini conclusion This chapter looks at the aspects of corporate culture, such as norms, values, and coordination and integration, and its impacts on the organisational effectiveness at the GDVC At first, the author gives some information about the development history and organisatioanal structure of the GDVC Based on these information, the study goes into the details of corporate culture and how it impacts on each individual and the entire organisation Because of the clear vision and mission, it is easy for all staff to adopt the oganisational culture and help to enhance the effectiveness of organisation Võ Thùy Linh 35 CQ47/51.03 Graduation thesis Faculty of Foreign Languages CHAPTER RECOMMENDATIONS 3.1 Summary of the findings The study on the corporate culture shows that there is a close relationship between corporate culture and organisational effectiveness In the evaluation of the corporate culture at the GDVC, it can be seen certain aspects of corporate culture: norms, values, and coordination and integration Norms are defined as standards of behaviors that are typical of or accepted within an organisation At the GDVC, norms refer to the ―Code of Conduct‖ and the ―Client Charter‖ which are ways of behaviors for all staff to follow Additionally, values include strategies, and goals which are proclaimed to all staff and give them a guideline to set their own targets and plans to reach those targets At the GDVC, values are the Vision, Mission, and the development strategies Lastly, coordination and integration are the act of mixing people to pursuit the common goals The correlations of norms, values, and coordination and integration are positive and significant They contribute to increase the organisational effectiveness at the GDVC Based on the research results and literature review on the relationship between corporate culture and organisational performance, it is suggested that the GDVC should take action to build a healthy corporate culture to iprove the organisational effectiveness Võ Thùy Linh 36 CQ47/51.03 Graduation thesis Faculty of Foreign Languages 3.2 Suggestions for improving the corporate culture at the GDVC Raise the awareness of corporate culture within the GDVC The very important task to build a better organisation is that all staffs in the organisation have to know clearly what they are doing That is why acknowledgement of corporate culture plays such a key role Organisation that invests in cultural awareness training undoutedly reaps rewards through effective working relationships, better communication and productive staff Cultural awareness also helps to improve the labour relations Firstly, it would be better if the organisation opens more training courses for employees, not only training for new employees but also general training for the old ones For example, organisation opens training courses in obeying the customs law for new customs officers When carrying out customs procedures, customs officers shall have the following tasks and powers: strictly complying with laws, professional customs processes and taking responsibility for the performance of their task and powers Besides training course for new employees, general training courses should be opened every three month for all to remind and strengthen their awareness about culture at the GDVC Furthermore, training courses can teach some necessary skills: communication skill, problem-solving skill… In case of organizing the collection of taxes, the customs officers who carry out the procedures for export and import of goods shall check the tax declaration and calculation bu customs declarers; when they discover the wrong calculation of the payable tax amount by customs declarers, they must, after adjusting such amounts, notify the customs declarers thereof Võ Thùy Linh 37 CQ47/51.03 Graduation thesis Faculty of Foreign Languages Lastly, contents of training courses should be vertified Of course, the training for new customs officers is needed to remain the content about both the GDVC‘s history and corporate culture, but general training for old employees should have more diversifying contents Promote the role of leadership in building positive corporate culture According to Warren G Bennis, ―Good leaders make people feel that they’re at the very heart of things, not at the periphery Everyone feels that he or she makes difference to the success of the organisation When that happens, people feel centered and that gives their work meaning” He affirms the role of leaders for an organisation The leaders are the heart, the soul of the entire organisation From the current situation of the GDVC‘s corporate culture, there are some recommendations on the organisational leadership as follows: Firstly, leaders must have a clearly defined what kind of corporate culture they want to see in place, and then, they will paint a clear picture of how people in the organisation need to coexist for the benefits of all employees Leaders need only create what they are prepared to follow up and monitor for the long haul Credibility is paramount; leaders must what they say to prevent loyalty erosion, retention issues, productivity issues, and ensure quality assurance The General Department of Customs should uniformly manage and execute activiies of the Customs at all levels Secondly, leader must ensure all staffs have a chance to have input into the company‘s daily culture, operations, and performance, to increase ownership to move from entitlement This is why it is important to involve employees in the mission statement, positions and their connections to jod description, accountability, and quality on regular basis – a minimum of once a year Võ Thùy Linh 38 CQ47/51.03 Graduation thesis Faculty of Foreign Languages In addition, leaders must have a very clear vision statement It is important that a leader makes sure that their vision is congruent, if applicable, with the senior leadership, board, and other vested interests Leaders also must ensure that they have supported for their plan prior to implementation Fourthly, leaders must have a clearly defined work flow and company protocol flow chart for all positions Leaders must have clearly defined reward plans, evaluations, staff benefits, discipline strategies, promotion plans, and other employee benefits Finally, leaders must clearly understand diversity issues which will be very important in effectively creating a healthy and productive corporate culture Leaders need to be sure that they have clearly defined measures, so that they can keep a pulse of what is really going on, and not get caught in assumptions Leaders need to ensure they are getting accurate feedback by simply being interested daily in the corporate culture‘s pulse Organisational culture is a major aspect to organisational success or failure By its very nature, it can prove to be resilient to be needed change However, good leaders of professional services organisations with the will to change helps to create effective culture that are strong, adaptive, and sustainable overtime Maintaining corporate culture to enhance the effectiveness at General Department of Vietnam Customs Organizational culture is maintained through a process known as attractionselection-attrition (ASA) First, employees are attracted to organizations where they will fit in Someone who has a competitive nature may feel comfortable in and may prefer to work in a company where interpersonal competition is the norm Võ Thùy Linh 39 CQ47/51.03 Graduation thesis Faculty of Foreign Languages Others may prefer to work in a team-oriented workplace Research shows that employees with different personality traits find different cultures attractive For example, out of the Big Five personality traits, employees who demonstrate neurotic personalities were less likely to be attracted to innovative cultures, whereas those who had openness to experience were more likely to be attracted to innovative cultures At this point in the process, the second component of the ASA framework prevents them from getting in: selection Just as candidates are looking for places where they will fit in, companies are also looking for people who will fit into their current corporate culture Many companies are hiring people for fit with their culture, as opposed to fit with a certain job For example, Southwest Airlines prides itself for hiring employees based on personality and attitude rather than specific job-related skills, which they learn after they are hired Companies use different techniques to weed out candidates who not fit with corporate values For example, Google relies on multiple interviews with future peers By introducing the candidate to several future coworkers and learning what these coworkers think of the candidate, it becomes easier to assess the level of fit Even after a company selects people for person-organization fit, there may be new employees who not fit in Some candidates may be skillful in impressing recruiters and signal high levels of culture fit even though they not necessarily share the company‘s values In any event, the organization is eventually going to eliminate candidates eventually who not fit in through attrition Attrition refers to the natural process where the candidates who not fit in will leave the company Research indicates that person-organization misfit is one of the important reasons for employee turnover Võ Thùy Linh 40 CQ47/51.03 Graduation thesis Faculty of Foreign Languages Because of the ASA process, the company attracts, selects, and retains people who share its core values, whereas those people who are different in core values will be excluded from the organization either during the hiring process or later on through naturally occurring turnover Thus, organizational culture will act as a self-defending organism where intrusive elements are kept out Supporting the existence of such self-protective mechanisms, research shows that organizations demonstrate a certain level of homogeneity regarding personalities and values of organizational members Võ Thùy Linh 41 CQ47/51.03 Graduation thesis Faculty of Foreign Languages CONCLUSION The objective of the study is to analyse the relationship between corporate culture and corporate performance at the GDVC After collecting data through the questionnaire, the author analyses the aspects of corporate culutre and the impacts of the corporate culture on the organisational effectiveness The study shows that the corporate culture has a positive impact on the organisational effectiveness at the GDVC The study looks at the three aspects of corporate culture and analyses their impacts on the organisational performance: Norms are significantly related both to the absolute number of innovations successfully implemented in the GDVC and to the frequency and importance of innovation as an element of organisational strategy Norms allow the GDVC to move beyond past failures through to innovation and achievement, which assesses the effectiveness of the GDVC Values assist the GDVC and its employees by providing as framework for how staff treat one another and customers; providing a framework for achieving the vision and mission and increasing the effectiveness of the GDVC; and differentiating it from another Coordination and Integration help the GDVC to improve in efficiency to works, quality of manufacturing and impact the performance of organisation Corporate culture is the sum total of the attitudes, behaviors, beliefs, and traditions of the GDVC It encompasses the collective goals of organisational and the standards of expected behaviors in achieving those goals at the GDVC So, corporate culture plays an important role to motivate all staff and enhance the effectiveness of organisational at the GDVC Võ Thùy Linh 42 CQ47/51.03 Graduation thesis Faculty of Foreign Languages REFERENCES Brenner (1927), interview conducted in September 2008 Brown (1990) Organisational Culture, Pitman Publishing, London, UK Daft, R.L (2000) Organisation Theory and Design (7th Ed.) SouthWestern College Publishing, Thomson Learning U.S.A Edgar Schein (2004) Corporate Culture and Leadership (3rd Ed.) Jossey Bass E D Beinhocker, The origin of Wealthy Evans, W.M Effectiveness: (1976) An Organisational Exploratory Theory Analysis and Corporate Organisational and Administrative Science (1) Ehow.com Gareth Morgan (1943), Images of Organisation, Thousand Oaks, CA: Sage Publication Gibson, J.L, Ivancevich, I.M & Donnelly, I.H (1991), Organisation: Behavior, Structure, Processes, and Homewood: Irwin 10 Hodgetts & Luthans, F (2003) International Management: Culture, Strategy, & Behavior New York, Mc Graw – Hill/ Irwin, 5th Ed 11 Hofstede, G 1980 Culture’s Consequences, Sage London 12 Kilmann, R.h, Saxton, M, Serpa, R and Associates (1985) Gaining Control of the Corporate Culture Oxford, Jossey-Bass 13 Maheshwari, B.I (1980) Decision Style and Corporate effectiveness New York: New Vickas 14 Oxford advanced Learner‘s dictionary 15 Pettigrew, A (1979), Studying organisational culture Administrative Science Publications Võ Thùy Linh 43 CQ47/51.03 Graduation thesis 16 Faculty of Foreign Languages Ricardo, R., & Wade, D (2001) Corporate Performance Management: How to build a Better Organisation through Measurement Driven Strategies Alignment Butterworth Heinemann 17 Rokeach (1973), The Nature of Human Values 18 Robert Solomon & Fernado Flores, Building Trust in Business, Policies, Relationship, & Life 19 Russell, R., The Effect of Environmental Context & Formal & Informal Organisational Influence Mechanisms on the Process of Innovation, (Pittsburgh, Univ of Pitsburgh, Graduate School of business, 1986) 20 Sannack, P (1996) Perspective on Employees Performance Management Research News, 119 (4/5), 38-40 21 Www Bittle-solutions.com/ HR 22 http://www.customs.gov.vn/ Võ Thùy Linh 44 CQ47/51.03 Graduation thesis Faculty of Foreign Languages APPENDIX Opened – ended questions for all staff on characteristics of organisation‟s corporate culture Dear Sir/ Madam, Thank you for taking time to answer this questionnaire I am a student at the Academy of Finance I am carrying out a study on the impacts of corporate culture on the organisational effectiveness at the GDVC I need some factual statistics about the company‘s corporate culture Therefore, your opinion will be great help for my research Your responses will be strictly confidential and data from this research will be reported in my research paper only Thank you very much for your time and support Please start with the survey now by answering the following questions Subjects Questions Answer Yes Mission Does organisation have mission and Vision and vision? No Unsure Do you all know clearly about organisation‗s mission and vision? Can organisation‘s mission and vision seen and found in the Võ Thùy Linh 45 CQ47/51.03 Graduation thesis Faculty of Foreign Languages organisation? Systems Is your organisational structure and hierarchical? Processes Do you get the anticipated results from your efforts? Do you deliver your services in focused, effective and streamlined workflows? Do you use your resources in a way that creates values to your customers? Team Are promotions based on Orientation performance, ability and the skills shown in developing others? Do people generally operate in cohenrent working group devoid of internal policies, power and authority? Values Is everyone in your and beliefs organisation treated each other as a professional? Võ Thùy Linh 46 CQ47/51.03 Graduation thesis Faculty of Foreign Languages Do your people generally have a can-do spirit? Are people generally mutually sopportive of each other? Does everyone have a passion for the customer? Võ Thùy Linh 47 CQ47/51.03 SUPERVISOR„S EVALUATION Supervisor: Ms Trương Thị Minh Hạnh M.A THESIS EVALUATION Student: Võ Thùy Linh Group: CQ47/ 50.03 Title: “The effects of corporate culture on organisational effectiveness at General Department of Vietnam Customs” ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… …………………… Mark: In number: In word: Supervisor M.A Trương Thị Minh Hạnh REVIEWER‟S EVALUATION Name of reviewer: ……………………………………………………………… THESIS EVALUATION Student: Võ Thùy Linh Group: CQ47/ 50.03 Title: “The effects of corporate culture on organisational effectiveness at General Department of Vietnam Customs” ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ………………………………………………………………………………… ……………………… Mark: In number: In word: Reviewer ... paper only deals with the following questions:  What are the aspects of corporate culture at General Department of Vietnam Customs?  What are the impacts of corporate culture on the organisational. .. overview on corporate culture, and its impacts on the organisational effectiveness Chapter - THE STUDY analyses the current situation of corporate culture at General Department of Vietnam Customs. .. Graduation thesis Faculty of Foreign Languages General Department of Vietnam Customs with the expectation of enhancing the effectiveness at General Department of Vietnam Customs Aims of the study