Manager resource development in small and medium-Sized enterprises (SMEs) of animal feed production industry in Vietnam

1 INTRODUCTION 1. Rational of the research According to statistics of Vietnam Animal Feed Association, currently there are 241 animal feed production enterprises that spread across the provinces. Domestic SMEs are evalutated weaker and difficult to compete with large foreign companies on three aspects: management capacity, promotion policy and input strategy that depend very much on the capacity of managers. Actually these enterprises mainly operate independently and economic potential is limited. About 80% of manager resource (including three levels: top, middle and lower-level management) of SMEs hold university degree but mostly in engineering majors. Economics majors are limited; especially management and operation skills are weak, and have not been trained methodically. Therefore ability of SMEs of animal feed production industry in surviving, developing sustainably and having competitiveness in the economic integration process is an enormous challenge. The shortage of human resources, especially manager resource (MR) is a major challenge for SMEs; therefore the author chose the topic "Manager resource development in small and medium-sized enterprises (SMEs) of animal feed production industry in Vietnam" to do the research for her doctoral thesis. 2. Research objectives Systematize theories on human resources (HR) development, MR development in enterprises; Study the content of MR development and analyze the major factors affecting MR development in the SMEs of animal feed production industry in Vietnam; Recommend solutions to develop MR to meet the development needs of Vietnam animal feed production industry to 2020. 3. Subjects and Scope of the research - Research subjects: MR development in SMEs of animal feed production industry in Vietnam. - Scope of the research: Thesis focuses on researching SMEs of animal feed production industry in the Northern provinces of Vietnam. 2 - Limitation of the study: Thesis only studies private enterprises, limited companies, partnership enteprises, joint stock companies without state capital and it do not study state enterprises, foreign and joint ventures enterprises. MR development in SMEs is developing existing managers in enterprises, not attracting and recruiting from the outside. Subjects of MR development is managers who perform certain management functions in SMEs of animal feed production industry in Vietnam including top managers (Director, Deputy Director and Chief Accountant), middle managers (Deputy Manager of Department or above) and lower-level managers (Head of Production). 4. Contribution of the research
About the theory - The research summarizes the theoretical issues related HR development in general and MR in SMEs development in particular. Thesis shows its own perspective on the content and MR development activities in enterprises: MR development is not only focusing on training but also on other important activities, such as MR planning (assessing the status of MR and forecasting the MR); personal development and manager promotion. - Thesis researchs and studies international experience about MR development in SMEs and draw lessons for SMEs in Vietnam.
In practice - MR development in SMEs is a new research content for SMEs of animal feed production industry in Vietnam. Research results showed the limitations in MRs development activities: (i) Do not have department responsible for HR development in general and MR development in particular; (ii) Do not have MR development plan in the short term and long term; (iii) Lack of coordination with outside training institutions; (iv) Do not have personal development plan for managers; (v) Unclear manager promotion policies and do not have specific standards, procedures. - Proposing groups of solutions to develop MR, including new solutions focused on improving the quality of MR for each specific level because of the different quality requirement of mangers at all levels. Training will play a key role in these solutions. 3 5. Structure of the thesis Besides the introduction, conclusion, list of references and appendices part, the thesis consists of 5 chapters. Chapter 1: Overview of scientific studies related to the research; Chapter 2: Literature review on MR development; Chapter 3: Research Methodology; Chapter 4: Research results; Chapter 5: Solutions and Recommendations. CHAPTER 1: OVERVIEW OF SCIENTIFIC STUDIES RELATED TO THE RESEARCH 1.1. Overview of research on MR development in the world 1.1.1. Studies related to the human resource development theory The number of surveys, analysis and critical theory development in HR development has been limited in the past two decades. This is a very complex and developing field; therefore defining theory of HR development is relatively difficult, even the concept of HR development is not a unity. It can be said that HR development which does not really have its own theory, is based on the application of the theory of its basic tenets such as education, general systems theory, economics and the theory of human relations and organizational behavior. Whether the theory studied in the various view they all agreed that HR development aims to develop the skills and awareness for each individual, thus bringing their contribution to the organization through learning, training and development. 1.1.2. Research related to theories on human resource development Since the term of HR development has been used, there are at least two main methods that have been developed related to the realization of HR development in organizational theory: - English researchers follow the study method and model development, which focus on training and development. - The U.S. researchers emphasize performance results model, which focus on staff development to enhance and improve the work efficiency. Most of American approach is through organizational development theory and emphasizes the development of training, consulting and leadership. 4 1.1.3. Research related to MR development in the enterprises In 2000 Jason Cope explored the learning process of entrepreneurs related to the parallel process of personal development and business. This study highlighted the need for consulting support programs to help entrepreneurs increase the effectiveness of learning outcomes. Other studies addressed learning styles of enterprise owners (David Rae, 2000), training and development for enterprise owner (Douglas D. Durand). In 2004 while studying on training & development and the development of SMEs in Australia, Janice Jones analyzed and showed the important differences in management and professional qualifications training, changing training methods to suit with the SMEs development. David Devins and Steven Johnson in 2003 studied the training and development of SMEs, HR development support and solutions to interfere in training and development activities in SMEs in the UK. Alan Coetzer, 2006 studied the influence of managers on the elements of working environment that had ability to affect learning in formal workplace. Juliet MacMahon, 1999 studied life and growth cycle which suggested that the ability of internal management is an important element in HRM and can affect the success of a small enterprise. 1.2. Overview of research on MR development in Vietnam’s enterprises In recent years there have been some scientific studies at ministerial level, doctoral thesis and master thesis which studied the Vietnamese entrepreneur, management capacity, MR training and development in organizations and enterprises. These studies mainly go into analyzing and assessing the status of training and development for management staffs, professional staffs or lecturers in organizations, enterprises or training institutions. This is one of the important activities in organizations and enterprises to enhance the managers’ capacity and their professional. In general, these studies summarized the theory on HR training and development in general and MR in particular. However, these studies primarily assessed the status of training and proposed solutions to improve the quality of management workforce and technical workers in a certain industry, or recommend macro management policies. The above mentioned studies have not considered objective and subjective factors affecting the MR development of enterprises and the impact of these factors. 5 CHAPTER 2: LITERATURE REVIEW ON MR DEVELOPMET 2.1. Concepts 2.1.1. Human resources: HR of an organization includes all employees who are working in that organization, and human being is understood as resources of each person that includes physical and intellectual resources. 2.1.2. Manager resource: Within the scope of this research, MR can be understood as closely linkage among the implementation people of certain management functions in the SMEs of animal feed production industry in Vietnam, including top managers (Director, Deputy Director and Chief Accountant), middle managers (Deputy Manager of Department or above), lower-level managers (Head of Production) to maximize the abilities of HR in order to meet the development goals of the enterprises. 2.1.3. Human resource development: is the process of increasing the quantity (size) and improve the quality of HR to create more reasonable HR structure. All three aspects of quantity, quality and structure of HRD fastened together, in which the most crucial factor of development is HR quality must be enhanced. 2.1.4. Manager resource development: MR development is a activity of HR development. MR development aims to ensure the quantity of managers, improve the quality of managers in order to support them to fulfill manager’s roles and responsibilities. 2.2. Content and main activities of MR development 2.2.1. Content of MR development 2.2.1.1. Quantity development Assessing the number refers to the current number of managers and the number of managers in the future. The number reflects the scale of an enterprise which is considered association with the structure of MR. 2.2.1.2. Quality development Quality of MR is evaluated through implementation capacity, qualifications, management skills, quality, health ... of managers. Quality assessment of MR is a critical requirement to analyze, assess the required capacity of each position to meet the development goals of the enterprise. Improving the quality of MR is also developing MR in terms of quality. 6 2.2.1.3. Structure of MR Structure of MR is shown on various aspects such as the structure of training levels, gender, age... MR structure reflects the relationship among departments in overall HR of the enterprise. The most important structure which reflects the overall quality of MR in the enterprise is structure by sector, by the qualifications, and by the capability of positions. 2.2.2. Main activities of MR development 2.2.2.1. MR planning HR planning is the process of evaluating, identifying HR needs to meet the goals of the organization and building up the working plan to meet those needs. The essence of HR planning in general and MR planning in particular is planning MR in short, medium and long term for the enterprise. MR planning will forecast the demand of MR that will be the basis for development of MR in enterprise. 2.2.2.2. MR training To make the MR training activies effective, enterprises need to build the training program by system approaching includes three stages: Identify training needs, Implement training and Assess training. Identify training needs related to organizational analysis, job analysis and personal analysis. After identifying training needs, organizing to implement training is very important. This is completed by selecting the proper object of training, training methods, training facilities, appropriate teaching staff and creating the necessary conditions for managers to participate in training effectively. Training activities should also be evaluated to see what are the obtained results and the learned lessons for the next times. 2.2.2.3. Personal development and manager promotion - Personal manager development: is a term that describes training experience, working practices, and counselor relationship to improve the managers. - Manager promotion: Promotion is putting workers in a position with higher salary, more prestige and greater responsibility, better working conditions and having many more opportunities for development. 7 2.3. Factors affecting manager resoure development in SMEs 2.3.1. Macro policies: Any enterprises or organizations which active in the national economy must abide by the rules and policies of that nation such as labor law, investment law... Therefore training and HR development in general and MR development in particular must also comply with these regulations. 2.3.2. Business strategy: Business strategies of enterprises which have significant impact to MR development, is a basis for planning the development direction of the MR about quantity, structure, and capacity requirements and propose implementation solutions in each period of the organization. In addition, business strategies also affect MR development through other factors such as the structure of business operation, characteristics and operation scale of the enterprise. 2.3.3. Organizational model and structure: Organizational model and structue affect MR development on two main items: Firstly, the business model and structure decide organizational management structure and implement MR development. Secondly, the business model and structure decide that MR structure should be consistent with the structure of production and business activities in each period. 2.3.4. The vision of enterprise leaders on MR development: If the vision of enterprise leaders is taking training and development as measures to improve the quality of MR, training and development activities of this enterprise will be emphasized and widely organized. The vision of leaders is always the most impact factor on the operations of the enterprise and will decide to invest developing in which enterprise’s activities to achieve enterprise’s goal. 2.3.5. Human resoure management policies of enterprise The HR policies in enterprises express the specificity of enterprise and are very different. The policies depend on the activity field, on the scale, characteristics and properties of enterprises, on the skill level and the vision of leaders. These are some of the most important HR policies of enterprsies: HR attraction policies; HR arrangement and usuage regulations; Treatment regime. 2.3.6. The level of science and technology: 8 Prior to the rapid change of science and technology, the MR development activities are more focused because managers should be provided knowledge, new skills to be able to use the new equipment putting into production. To be able to manage and administer the high qualified professional workforce, modern production lines, the managers need to be trained and developed. 2.3.7. Organizational culture: Under working environment aspect in MR development, organizational culture is analyzed on the basic criteria: working style, leadership style, relationships between staffs and characteristics of staffs. Management methods will focus more on human culture, a method that has capable of stimulating self-reliance and creativity. If enterprises highly evaluate the striving of individuals in enterprises, obviously it will affect MR development activities. 2.3.8. Financial capacity: Financial capacity of enterprise also affects implementation of training activities in enterprise. Because of limited financial capabilities many enterprises can only do the internal training in enterprises and can not send staffs for training at the reputable training organizations. 2.4. Meaning of MR development in SMEs 2.4.1. Small and medium-sized enterprises (SMEs): is a business which registered in accordance with law, is divided into three levels: micro, small and medium by the scale of total capital (total capital that is equivalent total property is determined in the balance sheet of the company) or annual average number of employees (total capital is the priority criteria). 2.4.2. The necessity of MR development in SMEs HR development in general and MR development in particular is an important condition for enterprises to survive and sustainably develop for three main reasons: Meeting the requirements of the organization; Meeting the learning needs and development of managers; Being the strategic solutions to create competitiveness advantage of enterprises. 2.5. Experience in MR development in SMEs of some countries in the world 2.5.1. Experience in HR and MR development of Japan It can be confirmed that the success of Japan is thanks to the HR management model. This model has allowed managers to implement 9 consensus opinion goal and benefit sharing between enterprises and individuals. The philosophy "The whole country is a company, the company is as family" has created a major power in the social development process. 2.5.2. Experience in HR and MR development of ASEAN countries Malaysia, Singapore and Thailand have HR and MR fostering and development activities which have reached harmony with life and working environment are constantly being improved for each employee; focus on developing specialized associations... 2.5.3. The applied lessons to Vietnam Through empirical study of MR development in some countries around the world such as Japan and the ASEAN countries (Singapore, Thailand), the applied lessons to the MR development of SMEs is: assessing current managers, developing and publishing MR development strategies and policies, paying attention to regular improvement activities with different forms and organizing management systematically and closely. CHAPTER 3: RESEARCH METHODOLOGY 3.1. Research design 3.1.1. Research process (Figure 3.1) 3.1.2. Research methodology 3.1.2.1. Qualitative research Qualitative research method is used in the discovery research stage: studying the secondary literature and discussion with experts, industry managers, and some enterprise owners and managers to explore, adjust, and supplement observed variables, build up the preliminary scale of factors affecting MR development and current status of MR development. This method is done through in-depth interviews with a pre-prepared content. 3.1.2.2. Quantiative research Quantitative research method is used to test the measurement scales and measure factors affecting MR development activities in SMEs. This is the official study period which is done through a survey (sample randomly selected n = 75) some owners/directors of SMEs and managers mainly in 10 Hanoi, Hung Yen, Bac Ninh, Ha Nam, Hai Duong... by detailed questionnaire. Figure 3.1 Research process Systematized theory Questionnaire design Clarify requirements about: - Number of managers - Working implementati on capacity of managers - MR structure Current MR development activities in SMEs - MR planning - MR training - Personal manager development - Manager promotion Clarify the cause of MR development braking Survey on the current quality of MR Influential factors - Macro policies - Business strategy and plans - Leaders’ view - Financial capability Survey on the current quantity of MR Survey on the current structure of MR Current status of MR in SMEs Content of MR devlopment - Quantity - Quality - Structure Clarifying the limitations in MR development implementing Overview of the research Propose solutions to develop MR 11 3.2. Official research 3.2.1. Questionnaire design Questionnaire is done on the basis of the selected scale and group discussion about the factors affecting the MR development in SMEs of animal feed production industry. Content and observed variables in the composition are corrected accordingly. All the observed variables in components are used 5-point Likert scale which is arranged from small to high number in which higher number is higher agreement with the statement (1: Strongly disagree, 2: Disagree, 3: Neutral, 4: Agree, 5: Strongly agree). 3.2.2. Evaluate the reliability of the scale: results of reliability analysis Cronbach's Alpha coefficient for the factors show that those factors are reliability. This demonstrates appropriate scales and they can be used. 3.2.3. Data process The collected data are processed by SPSS software version 13.0. After being cleaned and coded data will be analyzed through the following steps: - Assessing the scale reliability through Cronbach’s Alpha coefficient. - Descriptive analysis to assess the factors affecting MR development the current status of MR development in the SMEs of animal feed production industry. CHATER 4: RESEARCH RESULTS 4.1. Overview of Vietnam’s animal feed production industry 4.1.1. The development of Vietnam’s animal feed production industry Since the 90s, animal feed production industry of Vietnam has grown rapidly along with the development of the livestock sector. Average growth in total output feeds has tended to increase since 2000, reaching an average of increasing 13.5% from 2000 to 2011. During 2001-2006, the increase rate of average livestock was 8.5% and now accounts for about 25% of the total agricultural value. Thanks to the innovation policy of Vietnam Government as well as domestic and foreign invesment encouragement, multinational animal feed production companies like Cargill, CP, Proconco and Japfa began operation in Vietnam. 12 4.1.2. Current development status of Vietnam’s animal feed production industry According to statistics, there are now 241 animal feed processing enterprises (16.2% of foreign enterprises, 6.4% of joint ventures enterprises and 77.4% of dosmetic enterprises). Distribution of animal feed production enterprises primarily focused in the Red River delta – 106 enterprises, accounting for over 44% and the South East has 67 enterprises accounted for 28%. Vietnam Government encourages enterprises to invest in domestic animal feed production industry. The number of enterprises is growing, in which about 20-25 enterprises has built its own brand with the amount of investment from 2 - 3 million USD. About 30 enterprises invested over 10 billion VND and the rest are small workshop, each month they produce from 100-300 tons of animal feed. 4.1.3. The contribution of SMEs of Vietnam’s animal feed production industry - Create jobs - Contribute to economic growth - Ensure a more dynamic economy - Increase income for residents - Contribute to the implementation of economic restructuring - Contribute to entrepreneurs training 4.1.4. Characteristics of SMEs of Vietnam’s animal feed production industry - Small size of capital and labor - Low level of technology - Low education level of SMEs owners and managers - Weak capacity of SMEs owners and managers - Qualifications and capacity of staffs are lower than education levels of different types of enterprises because of specific technologies in SMEs - The level of information access: according to enterprises, they still lack the information and the published data in the journal is not often updated, especially the information of price. 13 4.1.5. Opportunities and challenges of Vietnam’s animal feed production industry until 2020 - Market opportunities: With the trend of science and technology development of society, people increasingly create productivity and high quality livestock, that requires an animal feed industry to develop appropriately. - Challenges of industrial animal feed price competitiveness: Price of Vietnam industrial animal feed is always higher than other countries in the region from 10-20%. - Requirements of animal feed production technology innovation: In the coming years, SMEs of Vietnam animal feed production industry should adopt technological and industrial feed production line of advanced countries in the world and in the region: silo storage system preserving materials; automatic control system for downloading of materials, mixing materials, heat treatment, extruded pellets; application of information technology in management of animal feed. - Manage animal feed quality: This work is still very weak in SMEs of animal feed production industry. 4.2. Sample description 57.33% of enterprises were established and have operated for 5-10 years. Number of enterprises operating for over 10 years is 44 accounting for the rate of 29.3%. Number of enterprises operating under 5 years in this industry is the lowest with 20 companies (13.3%). The majority of enterprises (65.3%) operating in this industry are joint stock companies. The rest are limited and private companies accounting for 21.3% and 13.2% of the total enterprises respectively. Most enterprises have a total workforce of 50-100 people with a rate of 64%. Number of enterprises with 100-300 employees account for 22.7% and the rest are under 50 (13.3%). In which enterprises that have management employees from 10-30 are accounting for the largest proportion (64%). Enterprises with over 30 managers are accounting for 22.7% and only 13.3% of enterprises have fewer than 10 managers. 14 4.3. Current status of MR 4.3.1. Quantity According to the survey result of the authors, 73.3% of enterprises answered that number of managers in the past 5 years increased less than 20% of the total, and only 10.7% of the total enterprises in this survey had the increasing number of managers more than 20%. Thus, there are 16% of enterprises did not increase the number of managers in the last 5 years. 4.3.2. Quality Quality of MR is assessed through capacity framework to perform the tasks at three management levels in enterpriese: top, middle and lower-level managers. Implementation capacity depends on the understanding of technical expertise, leadership and solving daily work skills of managers and especially also depends on their working attitude and style. This study provide assessment of the current capacity of managers at three management levels in SMEs of animal feed production industry, the required competencies of managers in the SMEs of this sector which need to be developed. They are: Thinking capacity, Management capacity, Professional capacity and Communication relationship & behavior capacity. Specifically as follows: Table 4.23: Necessary competencies to be developed for managers No. Content 1 Long-term vision for the development of the industry and enterprise 2 Arrange appropriate organization to functions and tasks 3 Schedule manager training and promotion plan which is appropriate to the development of enterprises 4 Build up clear and management regulations which getting consensus of staffs 5 Schedule training and promotion plan for specialized staffs which is appropriate to the development of speciality 6 Organize implementing plans to develop expertise, speciality which is appropriate to the development of the enterprise DN 7 Sum-up, review and evaluate the results of implementing clearly and convincingly 15 8 Negotiation and decision making skills 9 Skills to access and accurately evaluate information related to market In addition to these general required competencies of managers in other production sectors, managers of animal feed production industry lack international trade skills, the ability to access and exploit information on the world market related to input material resources. 4.3.3. Structure Regarding the structure by function, 37.3% of enterprises in this survey said that their enterprises did not increase the number of top managers in the last 5 years (from 2007 to 2012), 42.7% increased less than 20% in the total managers and 20% of them increased from 20% to 50%. Number of middle managers increased highest in the enterprises; 62.7 % enterprises increased the number of middle managers from 20% to 50% of the total managers. Only 25.3% of enterprises increased more than 50% the number of middle managers of the total in the last 5 years. The depth interviews showed that most of SMEs in animal feed production industry commented that the structure of their enterprises was suitable among the ratio of gender, age and qualification. Managers in enterprises did not have to take on other works at the same time. Management of enterprise was not overlap between divisions and departments. 4.4. MR development activities 4.4.1. MR planning • Quantity: 18.7% of enterprises forecast that they will not increase the number of managers in the next 5 years. The majority of enterprises (70.7%) will increase the number of managers less than 20% and more than 20% compared with the total is 10.7%. • Quality: There are 40% of enterprises in this survey said that the management capacity really need to be improved for managers in the future. Good management capacity will help managers at all management levels will operate enterprises smoothly and efficiently to bring effective business to their enterprises. Improving information search capacity, negotiation skills, 16 and the capacity to adapt to environmental changes will help enterprises stabilize input materials for production. • Structure: As predicting the MR structure by functions in the next 5 years, 86.7% of enterprises will increase the quantity of top managers and 57.3% of enterprises will increase the number of middle managers less than 20% of the total manager number. Mos of enterprises will increase the quantity of lower- level managers, 68% of interviewed people said they would increase the number of lower-level managers. 4.4.2. MR training * Identify training needs for MR: The basis for determining training needs is through organization analysis, individual analysis and result evaluation of working performance under the business plan for each period. Survey results showed that 70.6 % eneterprises have used the results of the performance evaluation (including informal assessment) to determine training needs but most enterprises have not done the organization analysis. The identification of training needs based on individual analysis was not shown clearly in the enterprises. The enterprises still rely heavily on the subjective opinions of leaders about necessary training fields in their enterprises. Only 42.6 % enterprises have designed the system to collect actual capacity evidence of managers. Enterprises have not built the working capacity framework for each specific titles and position to be able to detect the weak capacity that should be developed. * Training implementation to improve the quality of MR: 44% of surveyed enterprises have not had the overall plan to implement the training. Enterprises mainly implement well training methods through guidance, mentoring in enterprises and designing appropriate training activities to meet the needs of managers (72% of surveyed enterprises agree). However, enterprises underestimate in coordination with outside organizations in the design of training programs content, and training courses organization (only 13.3% of enterprises implemented this activity). The effectiveness of the training program is top concern, but the survey results showed that enterprises have not spent much attention for monitoring, reviewing and evaluating the effectiveness of the training program (only 28% of enterprises have done this activity). 17 4.4.3. Personal development and manager promotion According to the survey results, 86.7% of enterprises highly evaluated the contribution of each manager to have timely treatment regime. However enterprises have not yet focused on planning personal development which is suitable with development plans of the enterprise; not yet developed specific goal systems for managers to have personal learning plan (only 13.3% of surveyed enterprises have implemented this activity). Most enterprises implement the manager promotion and appointment by management levels. Only 29.4% of enterprises said they had policies to create favorable conditions for their staffs having the opportunity to develop and be promoted to management positions if they done their job well. This activity needs more paying attention by enterprises’ leaders to create the best motivation for managers. 4.5. Factors affecting manager resoure development in SMEs 4.5.1. Business strategy Survey results indicated that 53.3% of enterprises had built development strategy and business plan, but only 25.3% of them said that: "Every year, their enterprises build their MR strategies based on proposed business strategy”. It means that SMEs is always passive in business process and there are very few enterprises can adjust the quantity, structure and requirements about manager capacity to respond promptly in each period when objectives and business plan change. 4.5.2. The vision of enterprise leaders The results of the survey show majority of all enterprises’ owners and leaders (84%) are keenly aware of the importance and necessity of developing MR for the enterprise development. However, the perception is not coupled with practical action because the majority of enterprises do not have the HR development strategy in general and MR development in particular. 44% of participants in this survey respond that their enterprises’s leaders directly involve in the planning MR development. However there are 61.3% of the enterprises’s leaders does not regularly monitor the implementation of MR development. Most enterprises owners use specialized HR development staffs that were not trained basically. They do not build HR development policies and do not implement personal development for their staffs. 18 4.5.3. Financial capacity Survey results show that 20% of enterprises do not have financial plan for HR and MR development activities. Because of not having funds for this activity enterprises do not care and do not have the funds for staff development activities. According to the interview results also because of not having the budget, 20% of enterprises do not have suitable financial support for their staff to take part in the outside training organizations. Approximately 17% of enterprises have partly financial support for their managers to join in short-term courses to improve the professional level, mainly in marketing, preparation and implementation of business plans, market research skills and leadership skills courses. 4.5.4. Macro policies The support policies of state and the industry have a great significance for the development of SMEs. Specific policies: 90/2001/CP Decree dated 23/11/2001, the Enterprise Law 2005, the documents as Cooperative Law, the Law on Foreign Investment Promotion, the tax rules, export import regulations, Decision 143/2004/QD-TTg August 10, 2004 by the Prime Minister on HR training and promotion for SMEs… will affect the development of HR in general and MR in particular in SMEs. CHƯƠNG 5: SOLUTIONS AND RECOMMENDATION 5.1. Development orientation for HR development for SMEs Decree No. 56/2009/ND-CP dated 30/6/2009 on supporting SMEs development has clearly stated the responsibilities of ministries, industries and localities in support planning for HR training, improving management capacity for SMEs and confirmed that support plans for the HR training should be integrated into socio- economic development plans every year of ministries, industries and localities. The Prime Minister issued Decision No. 1231/QD-TTg September 7, 2012 on the SMEs Development Plan for 2011 - 2015. Developing this type of enterprise is a long term, consistency strategy and throughout the Government’s action program. Accordingly, SMEs development plan also gave 8 solutions in which the 4 th solution group is: 19 developing HR for SMEs, focusing on management capacity building for SMEs. In the coming time, while Vietnam continues to implement the commitments of economic integration, SMEs will face very difficult challenges in production, business, and import & export operations. With the existence of MR quality which is analyzed in Chapter 4, training to improve the quality of MR to meet the needs of economic integration is very important and urgent. This training should focus on training to improve the capacity for entrepreneurs especially for SME owners. 5.2. Perspective of MR development Fristly, HR development in general and MR development in particular is the core issue, is the most basic conditions for SMEs to promote internal resources and develop sustainably. Secondly, MR development must use comprehensive, scientific and comprehensive solutions to implement the content of MR development. They are: ensuring the quantity and structure, improving the quality of MR and developing motivated factors for staffs to meet the practical needs of the business activities in enterprises. Thirdly, MR development is based on considering MR as valuable asset, the most powerful impulse to promote enterprise development. Fourthly, MR development must proceed from the specific conditions of enterprises in order to promote the potential and its strength. Fifthly, MR development must take advantage of every opportunity to overcome the challenges of integration into the world economy; as well as conserve and develop traditional values, cultural identity and organizational culture. 5.3. Solutions to develop MR in SMEs of animal feed production industry 5.3.1. Solution group for the factors affecting MR development 5.3.1.1. Build up business strategies as basis for planning MR development MR development is an activity to serve the business activities of enterprises so it should have come from the enterprise's business strategy. Enterprises need to build strategic business with clear oriented objective system. Each SME in animal feed production industry will have different objectives to promote its competitive advantages. The main objectives focus 20 on optimizing production, sales effectiveness, proactive input source, developing after sales consulting services... For each target and depending on the specific enterprise, they will build up training programs and develop MR to meet enterprises’ goals. 5.3.1.2. Improving the awareness of all SMEs owners in MR development Vietnamese SMEs’ leaders/owners should be more active in MR development of their enterprises. Enterprises’ owners are required to identify that the MR is the most precious asset, the most important factor in the development of enterprise. MR is considered as the most important element of the system to build business strategy and create competitive advantage. The operating results of enterprises are created by the people and for the people as well. 5.3.1.3. Financial solution: Enterprises should establish investment and development funds for MR training and development. They should plan to develop reasonable training and development funds and build a long-term accounting system. They should also provide funding for the compilation of documents and curriculum to enhance the quality of training and development for MR. 5.3.2. Solution group for MR development activities 5.3.2.1. Build up MR development plan MR development plan in SMEs of animal feed production industry should focus on achieving three goals: reaching the reasonable quantity and structure of manager, meeting the capacity requirements of each position, as well as building MR development strategies and policies of SMEs should be consistent with the business strategy in each planning periods. Enterprises should implement these following solutions to build up MR development plan: Assess managers’ capacities; Identify development strategy of enterprise; Identify MR development needs; Build up MR development plan; Implement MR development plan; Evaluate MR development plan. 5.3.2.2. Complete the training activities in SMEs a) Identify training needs Enterprises should make a survey of training needs, and then distribute to the managers to collect accurate information on the current and future training needs. After identifying the training needs of each manager, enterprises can use different methods to synthetize the survey results. Since 21 then they can determine the right training needs of enterprise through defining training objectives, determine right trainee and training content. To determine the exact trainees, enterprises should also implement working design and job analysis for the position to determine the training objects corresponding to the positions that should be trained in both present and future. It is necessary to build appropriate training programs for each different level of managers. For courses organized by the enterprises, it is necessary to have cooperation between universities’ lecturers and enterprises to create appropriate teaching materials for manager training and development activities. For managers who are sent to outside training organizations should also get information such as the purpose of education, training requirements, description of job which will be done after being trained and information about their strengths and weaknesses. After that, enterprises can choose training courses with suitable content to meet the training goals . b) Implement training Enterprises need to use training methods which have the training content and subject appropriate to managers at three management levels. Enterprises should organize professional training courses at enterprises by experienced technical experts, high qualified staffs and lecturers from universities. For top and middle managers, enterprises also should combine more domestic training with international training. In addition, enterprises can use conferences, seminars and presentations methods... c) Evaluate training activities: After completing the training program, enterprises can evaluate the training program by criteria such as training objectives have been achieved or not, the weaknesses and strengths of training programs and economic effectiveness characteristics of training through cost assessment and program results, from that comparing the benefits of the training program. Through final tests and results of the working implementation, they can detect the advantages and disadvatages of training program. Besides, it is necessary to be based on the assessment of the trainees after each course, meaning using the questionnaire method. With appropriate designed questionnaire, department in charge of training not only can gather information about the effectiveness of training courses but also can collect 22 solutions to improve future training programs hybrids, promote enthusiastic workers engage in building up training program activities. 5.3.2.3. Implement personal development and manager promotion: planning manager appointment, having plan to support managers to implement individual plan; enabling staff to cultivate and exposure more experience in the work other than the work they undertake; encouraging individual responsibility in their personal development. 5.4. Recommendations for state and SMEs management agencies 5.4.1. Complete macro policies: State and SMEs managament agencies of ainimal feed production industry need to create a safe business environment and facilitate the activities of SMEs. They are: building up completed, synchronous and tightly law systems; creating a clear legal framework; building a modern infrastructure; developing appropriate macro policies to create convenient social economic environment for the development of the economy. - Improving the standards of animal feed, the legal technical documents in the animal feed production. - Formulate a coordinating organization system to implement the supporting policies and programs for the development of SMEs. - Provide training on animal feed management for experts at the localites. - Establish forecasts department about market of animal feed production, in which component is the managers of associations and enteprises in animal feed production industry. - Bring information technology into managing animal feed because the price information of materials to produce animal feed in domestic as well as in the world changes everyday. 5.4.2. Support training for MR in SMEs of animal feed production industry: Ministry of Agriculture and Rural Development has organized workshops and seminars to enhance knowledge of animal feed management for managers at departments and enterprises. The training content focused mainly on knowledge about state management documents of animal feed; taking samples of animal feed. 23 However, SMEs want to be supported in financial issue to organize training courses about synthesis skills, international sales skills, marketing service skills and other specialized training. According to the author’s survey, SMEs wish to be supported to MR development as follows (ranking from high to low in order of priority): 1. Policies to support funding for training and development for SMEs; 2. Financial support; 3. Develop personal training system; 4. Policies to encourage lifelong learning; 5. Policies to encourage enterprises to develop on the job training. 5.5. Limitations of the study Limitation on research sample size: Quantitative research focuses primarily on SMEs of animal feed production industry in the North of Vietnam, but not for the whole SMEs of this indutry in Vietnam. Limitation on data collection methods: During direct interviews with SMEs owners of animal feed production industry in Northern, the athour had some difficulties. There were desired information that could not be fully exploited. Limitation on the scope of research: The research only studied on MR development in SMEs with main following types: private, limited enterprise and joint stock companies without state and foreign capital. Limitation on time of applying research results: The research results can only apply until 2020. After that, it is necessary to have other researchs to supplement consistently with the development needs of animal feed production industry in the future. CONCLUSIONS 1. The research codified the theoretical issues about HR and MR development; synthetized literature review about the content and activities of MR development in SMEs. 2. On that basis, the thesis collected information, analyzed the current status of MR development activities in SMEs of animal feed production industry. The thesis pointed out the limited capacity of managers and the limitations in MR development activities. Most enterprises owners are aware of the importance of MR development activities but they have not 24 implemented effectively. SMEs do not have specific procedures to evaluate the effectiveness of MR development; do not have department responsible for HR development; HR and MR development not ben done regularly. So that SMEs do not have appropriate personal development plans with the development plans of enterprise. 3. Based on the above assessments, the thesis proposed some perspectives, solutions and recommendations for MR development in SMEs of animal feed production industry. The solutions for SMEs are: SMEs owners need to understand the importance of MR development and their role in MR development; Formulate policies and strategies for MR development; Set up investment fund for the training and development of HR and MR; Implement personal training and development for MR; Besides the efforts of SMEs, the state should complete the macro policies to encourage the development of SMEs.