SCHOOL OF BUSINESS

ASSIGNMENT COVER SHEET

STUDENT DETAILS

Student name: Student ID number:

UNIT AND TUTORIAL DETAILS

Unit name: Human Resource Management Unit number: HRM-T321WSB-2

Tutorial group: Group 5 Tutorial day and time: Tue 8:00 – 11:15
Lecturer or Tutor name: Ms. Truong Nu To Giang

ASSIGNMENT DETAILS

Title: Final Essay

Topic: Employee compensation

Length: 8 pages Due date: 14/12/2021 Date submitted: 7/12/2021

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MINISTRY OF EDUCATION AND TRAINING

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 UNIVERSITY OF ECONOMICS HO CHI MINH CITY

INTERNATIONAL SCHOOL OF BUSINESS

HUMAN RESOURCE MANAGEMENT

FINAL ESSAY

EMPLOYEE COMPENSATION – MOMO –

PUBLIC RELATIONS SPECIALIST

STUDENT NAME:

STUDENT ID:

LECTURER: DR. TRƯƠNG NỮ TÔ GIANG

HO CHI MINH CITY, 2021

I. Introduction

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 1. Brief company introduction

Momo, also known as Online Mobile Services Joint Stock Company (M_Service), is a leading
company in Vietnam that specializes in mobile payments. The company was first established in
2007, officially launched the MoMo e-wallet brand in 2010. With the corporation of 25 domestic
and foreign commercial banks operating in Vietnam, the firm has pioneered the path for
Vietnam's fintech and digital economy. About its working history, with 14 years of operation,
MoMo Wallet has grown from a small agency with four founders to a joint stock company with
over 500 employees and over 5,000 agents in 57 provinces and cities. Moreover, over 8 million
customers registered to use Momo e-wallet and MoMo services through physical agents. To
achieve the success they have today, the company has always focused on developing its
ecosystem which consists of banks, MoMo payment acceptance locations, online sales firms, and
state authorities accept, and license, etc. MoMo's ecosystem has grown to include over 20,000
local and international partners across all industries. MoMo offers a network of over 100,000
payment acceptance locations ranging from high-end restaurants to modest individual business
houses (Momo, 2021). Having a massive system, the company must prioritize creating and
maintaining relationships with these organizations. As a result, developing and reinforcing
product brand names is crucial for Momo. Therefore, a public relations specialist play an
important role in a business's overall strategic communication strategy, the essay will provide a
quick introduction about the public relations specialist’s responsibilities and requirements

2. Job Introduction

Basically, a public relations specialist is someone who create, maintain, and grow favorable
image for the company they are working for to influence public perception (CareerExplorer,
n.d.). Their main responsibilities are managing and nurturing an organization's relationship with
the public, which includes consumers, investors, reporters, and other media professionals.
Additionally, they help to express their organization's point of view to its key audience through
media releases and interviews. Furthermore, public relations professionals collaborate with other
departments, such as advertising or marketing staffs, to create marketing communications plans
that guarantee advertising methods are compatible with the image that the organization or client
is aiming to present.

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About the requirements, a public relations specialist needs to have knowledge about
specialization and some other relevant fields such as marketing or journalism. Besides, since
working in a Fintech company, the employee also should have knowledge about E-commerce
and Fintech and familiar with social media platforms. There are some required skills and abilities
needed when working as a public relations specialist. For example, to create and maintain the
relationship with other organizations, excellent oral and written communication skills is
indispensable. Moreover, a public relations specialist should be able to work under pressure
since overtime working is becoming regular for this job.

3. Importance of the topic

The fintech industry is still in its early stages in Vietnam, but it has enormous potential for
growth. Even though Momo is a pioneer and has a large market share in this industry, the firm is
presently facing stiff competition from rivals such as Zalopay and Moca. As a result, Momo
needed to establish higher goals and push for more efficiency, which had an impact on
employment growth. Employee performance must be consistently improved and increased to
meet strategic goals. Furthermore, the organization must have human resource management
strategy in place to optimize the company's benefits. Typically, the employee compensation
system plays a significant role in attempts to improve human resource management.

According to Lang (2020), from the employee’s view, wage has a huge impact on the
employees’ overall income and living standard. Therefore, a decent salary might motivate
employees to work harder and put more effort to their jobs. Meanwhile, from the employer’s
perspective, pay is an effective instrument for furthering the organization’s strategic goal.
Compensation decisions will have an impact not only on the company's operations and financial
condition, but also on the employer's capacity to compete for workers in the labor market, as well
as their attitudes and actions while working for the business.

II. Body
a. Explain the major theories which organization use to build the pay structure and
identify which one is the most suitable for this job.

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Based on the recruitment announcement on Momo’s website, most of the job have a competitive
or negotiable salary, which leads to an unidentified company’s pay level and job structure.
Therefore, this article will primarily focus on the competitive salary that Momo offers their
employees, as well as discuss the major theories that the firm use to construct this pay structure.
Furthermore, this article will focus on which theories will be most appropriate for developing the
wage structure for public relations specialists.

One of the major theory Momo apply to develop its pay structure is equity theory. According to
the textbook, the theory states that most employees will evaluate their fairness in the workplace
by comparing their own pay with that of others, particularly those in the same position. In
addition, whenever the benefits are tangible, it is easier for workers to make equity comparisons.
Perceptions of inequity may cause employees to take actions to restore equity, which may cause
employee’s dissatisfaction (Banks, 2012). As a result, making the information confidential
appears to be a reasonable option for reducing the influence of equity comparisons, which Momo
seems to be doing right now. On the Momo's websites, the firm offers a competitive
compensation, which indicates that the amount of wage would be kept hidden from others. From
my point of view, Momo's decision is a sensible measure because employees cannot make
convincing comparisons without a definite amount. In addition, it also reduces both external and
internal equity pay comparisons. Furthermore, because comparison is one of the variables
contributing to employment discrimination (Goldberg, 2011), it is critical not to share sensitive
information that could be utilized in a comparison. Therefore, using competitive salary can help
Momo to reduce the exploitation and discrimination in the workplace.

Next, to build the pay structure, Momo also based on the reinforcement theory. This theory
stated that “high employee performance followed by a monetary reward will make future high
performance more likely” (Gerhart et al, 1995). From then, the outstanding employee will have a
motivation to work more effectively if he/she deserves to earn higher monetary reward, meaning
that applicants may be searching for a competitive compensation. Basically, one of the primary
reasons why some businesses prefer competitive pay is because it gives for flexibility for
negotiation. Companies frequently negotiate pay based on the employee's skills, talents, and

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what they can provide to the company. The advantage of this strategy is that it benefits both
parties. Employers can recruit and retain more talent since a negotiable wage is particularly
appealing to both job seekers and jobholders. Great employees, on the other hand, can bargain
for better compensation, which makes them feel empowered and motivated, hence, resulting in
an outstanding performance.

Nowadays, Momo is working in Fintech, which will be the next future of finance as it brings
potential opportunities for both online and offline business. Furthermore, during the COVID-19
epidemic, many clients are recognizing the value of utilizing an e-wallet when it becomes the
sole way to trace their transactions. As a result, Momo will have more opportunities once the
firm can demonstrate its value. Therefore, the firm must establish more effective communication
plans and the public relations divisions will play a crucial role in the organization’s strategic
goal. Consequently, the company will need to hire and retain many outstanding public relations
workers to achieve the objectives. Building a pay structure based on the reinforcement theory
will be the most suitable for the public relations specialist. As mentioned above, a pay structure
that offer a higher monetary reward will be a motivation for outstanding employees to put their
efforts on works.

b. This organization is evaluating whether the current pay structure makes sense in view
of its competitors. What are the organizations with which to compare to this
organization? Why is this organization’s pay structure different from those of the
competitors? What are the potential consequences of having a pay structure that is out
of line relative to those of the competitors?

According to a report by cafef (2020), Momo, Zalopay and Moca are currently the leading
companies in the field of e-wallets. With the position of holding a large share in the market,
companies are having to compete fiercely to gain their own advantages. Moreover, each
company has a great financial support as profits continue to increase and these companies are
receiving huge investments, which has made the competition become more intensive than ever

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before. Therefore, Moca and Zalopay will be the main competitors for Momo to make a
comparison with the current pay structure.

Based on the data on JobsGo (n.d.), all the three company offer a competitive salary and similar
benefits to the employee. As a result, it will be difficult to see the difference in the pay structure
between these firms since there is no specific figure. However, if we look at other factors which
may indirectly influence on the compensation’s decision, we can forecast the changes in the pay
structure.

To begin, in terms of consumer usage, Moca now leads the pack, with 95 percent of Moca users
stating they will continue to use the wallet even though the company will no longer offers
discount program, followed by Momo (89 percent) and Zalopay (84 percent) (Cafef, 2020).
Among these three wallets, Moca customers are the most inclined to promote brands, with a
score of 8.6, slightly higher than ZaloPay and Momo. As a result, it can be implicated that Momo
is now suffering more losses than its opponent, Moca.

The second point to discuss in this essay is brand awareness. According to the Q&Me (2020)
poll, Momo is presently the leading firm, with a brand recognition level of 73 percent, far
outstripping all competitors in the industry. In contrast to the previous point, this will provide
Momo with a significant competitive edge, which the firm must capitalize on to develop the most
effective tactics.

We can see from the above two aspect that, with the current companies’ performance, the gap
between the three firms is not too large. Therefore, it is possible that there will be no noticeable
variation in the overall compensation structure. However, it can be seen that Momo has a
significant edge in terms of brand awareness. From this, it can be concluded that public relations
is a critical component of business campaigns and that significant investment will be made in
this area. From there, it can be assumed that Momo's competitive salary for this position is
relatively high in comparison to other organizations, although we do not know the actual figure.

Momo can recruit many outstanding employees by offering a greater compensation than other
organizations. Furthermore, a competitive compensation will increase staff motivation and vigor,
resulting in increased labor productivity. Additionally, a large wage will provide employment

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security, allowing employees to remain for an extended period, saving Momo money on other
costs.

c. Aside from salary, what are other possible compensation method that this job holder
might prefer?

From the employee’s perspective, salary is one of the most essential factors to consider when it
comes to choosing a place to work. With a higher salary, employees will be significantly more
invested in their employment and the firm for which they work if they believe they are
appreciated by the organization. Furthermore, a higher income might assist workers improve
their living conditions, which may improve their health and boost the productivity. However,
income is only one part of compensation, and there are many other aspects that an employee also
needs to consider. This part will primarily concentrate on two areas of various compensation
systems other than salary, namely merit pay and gainsharing.

Merit pay, also known as pay-for-performance incentive, is a sort of compensation used by

businesses to reward high-performing staff with permanent bonuses. It entails increasing
employees' base pay or awarding incentives based on their performance. Merit pay is often used
as an appealing bonus for employees in order to motivate themselves in the workplace,
particularly those who work in performance-based jobs. Therefore, it will be a great incentive for
public relations specialists since Momo can provide bonus for their outstanding performance.
Moreover, merit pay will help to clarify the expectation from the employers and make the
company’s objectives become clearer (Indeed, 2021). Especially, it is more crucial for the public
relations specialists since they are the representatives of the company. Therefore, clearly
knowing Momo's objective will allow them to communicate with the public and other businesses
more effectively, which will boost the image of Momo.

Another remuneration method which will be attractive to Momo’s public relations specialist is
gainsharing. Gainsharing is a type of group remuneration based on group or plant performance

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(rather than overall profitability) that is not included in the employee's regular wage, hence
motivating more employee engagement (Noe et al, 2019). This will be a suitable incentive for
Momo’s public relations specialists since they are required to collaborate with other different
provisions such as marketing or advertising. Through gainsharing system, the whole company
will be involved in the attempts to improve the performance. Therefore, it will increase the level
of involvement, teamwork, and cooperation between employees. Moreover, as the company's
overall performance improves, employees will benefit more from increased compensation and
long-term job security.

d. Because of the Covid_19, the organization is facing some financial issues and decide
to change the compensation systems. Describe various ways the organization can
communicate these changes.

The COVID-19 pandemic's recent months have caused not only tremendous financial hardship
on Momo, but also an uncertain future ahead for the organization' s fiscal goals. As a result, the
company was forced to make significant adjustments to pay planning and advise its employees of
these changes, which was not an easy undertaking. According to Grunfeld (n.d.), compensation
is a highly sensitive topic, especially in the context of an epidemic, and requires corporations to
effectively communicate with their employees to accomplish the most potential positive
outcomes. Therefore, it is more important than ever to clearly convey to the employee how pay is
handled, regardless of the scale of the adjustments. To effectively communicate with these
changes, there are various way Momo can better utilize.

One of the methods is to involve employee’s participation in discussions about compensation

changes early and frequently during the process. According to Carver (2018), most workers
would feel trusted and appreciated if the business provides them information about the
adjustments early, showing that the firm is implementing these changes with their workers in
mind. Furthermore, open communication and sharing information with employees about adjusted
compensation plan improves the employee’s satisfaction. Moreover, since pay is one of the most
contentious issues in the human resources profession, Momo must ensure that each of its

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employees clearly understands the company's circumstances and why certain pay decisions have
been made. Besides, based on the survey which was conducted by TeamStage (2021), 99.1% of
employees want to be part of an organization that nourishes honest communication. Therefore,
being honest and straightforward when conveying compensation adjustments is something
Momo must do. Finally, Momo must follow up and promote ongoing feedback from the staffs.
One of the important aspects of communicating compensations changes is that the employees
can raise their voice. The two-way discussion allows the firm to not only collect input from their
members on how they feel about this issue, but also to learn how they would intend to address it
if they were in a director’s position.

Another method which is indirect is to provide managers with the necessary knowledge about the
compensation changes and abilities in order to deal with employees’ issues during the changes.
According to the Noe et al (2019), the managers play a key communication role in the
compensation changes because of their daily encounters with employees. As a result, they must
be prepared to explain why the pay structure is created the way it is and to determine whether
employee concerns about the structure should be addressed through structural changes. To
accomplish this goal, Momo must provide detailed information to the managers about the
company’s business operation and pay system, such as how pay levels are determined or how
pay ranges work. The managers will then have a general understanding of the overall business
and why some substantial adjustments should be undertaken despite the significant impact on
human suffering. Hence, they can then properly explain the matter to the employee once they
have a good understanding of the circumstance. In addition, this procedure is critical since a pay-
cut group with "enough explanation" will have less unfavorable effects than the opposite group
(Gerhart et al, 1995). When managers know "what" to say to employees, the next step is to know
"how" to tell it to them without causing massive human suffering, because not all workers want
to see their pay cut, especially in the COVID-19 pandemic. To effectively communicate with the
staffs, the managers will need training to develop special conversation skills to handle potentially
unpleasant cut pay negotiations. Even when there is no positive news on the matter, this will
make the talk more comfortable and simpler for both the firm and the individual.

III. Conclusion

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IV. References

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unauthorised absenteeism | Banks | SA Journal of Human Resource Management.

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CareerExplorer. (2019, November 14). What does a public relations specialist do?

https://www.careerexplorer.com/careers/public-relations-specialist/#what-is-a-public-

relations-specialist

Carver, C. (2021, January 24). Good Reasons to Share Compensation Information with

Employees. Astron Solutions. https://astronsolutions.net/good-reasons-to-share-

compensation-information-with-employees/

Clover, M. (2020, November 21). 4 Ways to Effectively Communicate Compensation Plan

Changes. GuideSpark. https://www.guidespark.com/blog/4-ways-to-effectively-

communicate-compensation-plan-changes/

Gerhart, B. A., Minkoff, H. B., & Olsen, R. N. (1995, January 1). Employee Compensation:

Theory, Practice, and Evidence. ResearchGate.

https://www.researchgate.net/publication/37149497_Employee_Compensation_Theory_P

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Indeed Editorial Team. (2021, February 28). Merit Pay: Definition, Advantages and

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salary/merit-pay

Lang, D. (2020, October 29). The Importance of Developing a Fair Compensation Plan.

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compensation-plan

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MoMo V. (2021, December 7). Giới thiệu Công ty Cổ phần Dịch vụ Di Động Trực tuyến (viết

tắt M_Service). Vi Momo. https://momo.vn/gioi-thieu/gioi-thieu-chung

P. (2020, May 6). Thị trường ví điện tử Việt Nam: Cuộc chơi “tốn kém”? Công ty Cổ phần

VCCorp. https://cafebiz.vn/thi-truong-vi-dien-tu-viet-nam-cuoc-choi-ton-kem-

2020050614180142.chn

T. (2021, January 9). 20 Fundamental Teamwork Statistics for 2021. TeamStage.

https://teamstage.io/teamwork-statistics/

VietnamCredit. (n.d.). Top+4+e-Wallets+in+Vietnam. https://vietnamcredit.com.vn/news/top-4-

e-wallets-in-vietnam_14252

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