Public Organization Review

, Volume 15, Issue 4, pp 565–579 | Cite as

Would Better Earning, Work Environment, and Promotion Opportunities Increase Employee Performance? An Investigation in State and Other Sectors in Vietnam

  • Phong D. Nguyen
  • Chuong X. Dang
  • Lam D. Nguyen


In today’s competitive and globalized economy, there has been constant emphasis on creating and maintaining a high performance work system (Arthur, 1994; Becker and Gerthart, 1996; Delery and Doty, 1996; Huselid, 1995, Pfeffer, 1998, Dessler, 2012). High employee performance is what managers at all levels aim for. In addition to ability, motivation has certain impact on employee performance (Wright, Kacmar, McMahan, & Deleeuw, 1995; Ivancevich & Matteson, 1987). This study examines the impact of earning, work environment, and promotion opportunities on employee performance. It also compares these impacts between employees who work in the state sector and those who work in other sectors. A survey was conducted involving 205 employees working in both state and other sectors in Ho Chi Minh City using multiple regression analyses. The results showed that earning, work environment and promotion opportunities positively influence employee performance. A comparison of the relative strengths of the effects reveals that in both state and other sectors earning has the strongest effect on employee performance, and that the effect is stronger in state sector than in other sectors. Promotion opportunities have stronger effect on employee performance in state sector than in other sectors. Finally, work environment has a stronger effect on employee performance in other sectors than in state sector. In this paper, managerial implications, limitations and recommendations are discussed.


Earning Employee performance Promotion opportunities State sector Other sectors Work environment Vietnam 


  1. Al-Anzi, N.M. (2009). Workplace environment and its impact on employees’ performance. A study submitted to Project Management Department in Saudi Aramco, Open University of Malaysia.Google Scholar
  2. Arthur, J. B. (1994). Effects of human resource systems on manufacturing performance and turnover. Academy of Management Journal, 37(3), 670–687.CrossRefGoogle Scholar
  3. Becker, B., & Gerhart, B. (1996). The impact of human resource management on organizational performance: progress and prospects. Academy of Management Journal, 39(4), 779–801.CrossRefGoogle Scholar
  4. Blumberg, M., & Pringle, C. D. (1982). The missing opportunity in organizational research: some implications for a theory of work performance. Academy of Management Review, 7(4), 560–569.Google Scholar
  5. Booth, A. L., & Frank, J. (1999). Earnings, productivity, and performance-related pay. Journal of Labor Economics, 17(3), 447–463.CrossRefGoogle Scholar
  6. Carson, K. P., Cardy, R. L., & Dobbins, G. H. (1991). Performance appraisal as effective management or deadly management disease: two empirical investigations. Group and Organization Studies, 16(2), 143–159.CrossRefGoogle Scholar
  7. Chandrasekar, K. (2011). Workplace environment and its impact on organizational performance in public sector organisations, International Journal of Enterprise Computing and Business System (Online), 1(1). Retrieved from http://www.ijecbs.comGoogle Scholar
  8. Delery, J. E., & Doty, D. H. (1996). Modes of theorizing in strategic human resource management tests of universalistic, contingency, and configurational performance predictions. Academy of Management Journal, 39(4), 802–835.CrossRefGoogle Scholar
  9. Dressler, G. (2012). Fundamentals of human resources management (2nd ed.). Upper Saddle River: Prentice Hall.Google Scholar
  10. Ferris, G. R., Buckley, M. R., & Allen, G. M. (1992). Promotion systems in organizations. Human Resource Planning, 15, 47–68.Google Scholar
  11. Gibbons, R (1997). Incentives and careers in organizations. NBER Working Paper No. 5705. Retrieved from
  12. Gielen, A., Kerkhofs, M., & Ours, J. (2010). How performance related pay affects productivity and employment. Journal of Population Economics, 23(1), 291–301.CrossRefGoogle Scholar
  13. Haynes, B. P. (2007). The impact of the behavioral environment on office productivity. Journal of Facilities Management, 5(3), 158–171.MathSciNetCrossRefADSGoogle Scholar
  14. Hoang, T., & Chu, N. M. N. (2005). Research data analysis with SPSS. Vietnam: The Statistical Publisher.Google Scholar
  15. Huselid, M. A. (1995). The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38(3), 635–672.CrossRefGoogle Scholar
  16. Ilgen, D. R., & Favero, J. L. (1985). Limits in generalization from psychological research to performance appraisal processes. Academy of Management Review, 10(2), 311–321.Google Scholar
  17. Ivancevich, J. M., & Matteson, M. T. (1987). Organizational behavior and management. Plano: Business Publications.Google Scholar
  18. Larkin, I., Pierce, L., & Gino, F. (2012). The psychological costs of pay-for-performance: implications for the strategic compensation of employees. Strategic Management Journal, 33, 1194–1214.CrossRefGoogle Scholar
  19. Leblebici, D. (2012). Impact of workplace quality on employee’s productivity: case study of a bank in Turkey. Journal of Business Economic & Finance, 1(1), 38–49.Google Scholar
  20. Nguyen, L. D. (2011a). Organizational characteristics and employee overall satisfaction: a comparison of state-owned and non-state-owned enterprises in Vietnam. South East Asian Journal of Management, 5(2), 135–158.Google Scholar
  21. Nguyen, N.K. (2011). Factors affect employees’ loyalty in Esquel company in Vietnam. Master Thesis, University of Economics Ho Chi Minh City.Google Scholar
  22. Olson, D. M., & Borman, W. C. (1989). More evidence on relationships between the work environment and job performance. Human Performance, 2(2), 113–130.CrossRefGoogle Scholar
  23. Perry, J., Mesch, D., & Paarlberg, L. (2006). Motivating employees in a new governance era: the performance paradigm revisited. Public Administration Review, 66(4), 505–14.CrossRefGoogle Scholar
  24. Peters, L. H., O’Connor, E. J., & Fulberg, I. R. (1985). Situational constraints: Success, consequences, and future considerations. In G. R. Ferris & K. M. Rowlands (Eds.), Research in personnel and human resources management (pp. 79–114). Greenwich: JAI Press.Google Scholar
  25. Pfeffer, J. (1998). The human equation: Building profits by putting people first. Boston: Harvard Business School Press.Google Scholar
  26. Phelan, S. E., & Lin, Z. (2001). Promotion systems and organizational performance: a contingency model. Computational & Mathematical Organization Theory, 7, 207–232.CrossRefGoogle Scholar
  27. Rego, A., & Cunha, M. P. (2008). Workplace spirituality and organizational commitment: an empirical study. Journal of Organizational Change Management, 21(1), 53–75.CrossRefGoogle Scholar
  28. Ruona, W. E. A., & Lyford-Nojima, E. (1997). Performance diagnosis matrix: a discussion of performance improvement scholarship. Performance Improvement Quarterly, 10(4), 87–118.CrossRefGoogle Scholar
  29. Schay, B. W., & Fisher, S. F. (2013). The challenge of making performance-based pay systems work in public sector. Public Personnel Management, 42(3), 359–384.CrossRefGoogle Scholar
  30. Seiler, M. J., Harrison, D. M., van Vliet, P., & Yeung, K. C. (2005). Return characteristics of state-owned and non-state-owned Chinese a shares. Financial Review, 40(4), 533–548.CrossRefGoogle Scholar
  31. Takahashi, K. (2006). Effects of wage and promotion incentives on the motivation levels of Japanese employees. Career Development International, 11(3), 193–203.CrossRefGoogle Scholar
  32. Trevor, C., Reilly, G., & Gerhart, B. (2012). Reconsidering pay dispersion’s effect on the performance of interdependent work: reconciling sorting and pay inequality. Academy of Management Journal, 55(3), 585–610.CrossRefGoogle Scholar
  33. Van Eerde, W., & Thierry, H. (1996). Vroom’s expectancy model and work-related criteria: a meta-analysis. Journal of Applied Psychology, 81(5), 575–89.CrossRefGoogle Scholar
  34. Wang, T., Wen, C. Y., & Seng, J.-L. (2014). The association between the mandatory adoption of XBRL and the performance of listed state-owned enterprises and non-state-owned enterprises in China. Information & Management, 51(3), 336–346.CrossRefGoogle Scholar
  35. Wright, P. M., Kacmar, K. M., McMahan, G. C., & Deleeuw, K. L. (1995). P = f (MxA): Cognitive ability as a moderator of the relationship between personality and job performance. Journal of Management, 21(6), 1129–1139.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media New York 2014

Authors and Affiliations

  • Phong D. Nguyen
    • 1
  • Chuong X. Dang
    • 1
  • Lam D. Nguyen
    • 2
  1. 1.University of EconomicsHo Chi Minh CityVietnam
  2. 2.Bloomsburg University of PennsylvaniaBloomsburgUSA

Personalised recommendations