UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ Nguyen Tri Thanh Green Innovation, Green Entrepreneurship, and Vietnamese SME Development: The Role of Market Turbulence MASTER OF BUSINESS (HONOURS) Ho Chi Minh City – Year 2019 TIEU LUAN MOI download : skknchat@gmail.com UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ Nguyen Tri Thanh Green Innovation, Green Entrepreneurship, and Vietnamese SME Development: The Role of Market Turbulence MASTER OF BUSINESS (HONOURS) SUPERVISOR: DR. DOAN ANH TUAN Ho Chi Minh City – Year 2019 TIEU LUAN MOI download : skknchat@gmail.com Green Innovation, Green Entrepreneurship, and Vietnamese SME Development: The Role of Market Turbulence Nguyen Tri Thanh 22160042@student.vn, Mbus 7 International School of Business Master Thesis Supervisor: Dr. Doan Anh Tuan tuandoan@isb.vn, TIEU LUAN MOI download : skknchat@gmail.com ACKNOWLEGEMENT I would like to express my sincere gratitude to my supervisor, Dr. Doan Anh Tuan, for his ongoing guidance and support with my master’s thesis and throughout my graduate career.
I would additionally like to thank committee members of International School Of Business | University Of Economics Ho Chi Minh City for the insight and encouragement they have provided throughout the completion of this thesis. I am especially gratefully to Mr. Pham Ngoc Hung who is a lawyer and vice chairman of the HCM City Union of Business Associations (HUBA) for support he has provided me. I would like to extend my utmost appreciation to Saigon Bizhub Company, and Leader of District 6’s economic department for support me collect dataset, which making this research possible.
Lastly I would like to thank my family and friends for the constant encouragement and enduring love they have provided throughout my life.com TIEU LUAN MOI download ABSTRACT Micro, small and medium enterprises (MSMEs) are significant part of the national economy, which contributed up to 40% of GDP. However, in today’s globalized world, the competition in the marketplace is increasing complex. Besides, the state attention is more concerned with sustainable environmental. Thus, Vietnamese enterprises, especially MSMEs or small medium enterprises (SMEs) that want to stand up and develop should pay attention to innovation not only consider business opportunities but also benefits of being environmental friendly business.
The goals of this study are to investigate the impact of green innovation (GI) on SME development (SMED) in the turbulent market conditions with mediation effect of green entrepreneurship (GE). Based on the research results, the study provides useful solutions to help SMEs development and help policy makers adjust appropriate policies. The activating of SMEs activities in Ho Chi Minh business City is corresponded to the demographic census of this study. A sample of 280 senior managers of SMEs is surveyed for the study.
The questionnaire tool is used to measure the research variables. A five point Likert scale is used to measure the questionnaire. To test the hypotheses, the study use SEM method with the support of Amos software. The primary contribution of this study is empirically examining the role of GE in relationship between GI and SMED in market turbulence.
However, this study use convenience sample of Ho Chi Minh City. Thus, limitation of this study is inevitable. Cross-region sample and undergraduate will be conducted for the further research 5 : skknchat@gmail.com TIEU LUAN MOI download Table of Contents 1.1 Definition of SMEs in Vietnam .2 The effect of Green innovation on Green entrepreneurship .3 Green entrepreneurship and SME development .4 The moderating impact of market turbulence.3 Measures of the constructs .3 Data analysis method .1 Exploratory factor analysis (EFA) .2 Reliability and Validity.3 Structural Equation Modeling .2 Exploratory factor analysis (EFA).4 Confirmatory Factor Analysis (CFA) .1 Structural Equation Modeling (SEM) .2 Structural Equation Modeling (SEM) of Moderator Analysis. DISCUSSION, CONCLUSION AND LIMITATION .2 Conclusion and Implications .com TIEU LUAN MOI download 1.
INTRODUCTION Nowadays, the role of innovation for environmental sustainability is significant growth. This is evidenced by relevant issues, which specially focus in importance among decision makers in organizations. Numerous studies have stress the increasing primary of sustainability as a criteria of innovation (Adams, Bessant, Jeanrenaud, Overy, & Denyer, 2012; Nidumolu, Prahalad, & Rangaswami, 2009; Varadarajan, 2017). There were many terms consist of eco innovation, eco-friendly innovations, environmental sustainable innovations, sustainable innovation, green innovations, and so forth.
In the academic literature and/or the issues obviously have used these terms to denote to innovations with essential of durable environment sustainability. This study uses the term Green Innovation (GI) with the stipulation, which the approaching of study considers innovations diminish the collision of organizational activities on the natural environment. Two years ago, the natural environment in central Vietnam was severely impacted by the disaster, which involves a Foreign Direct Investment (FDI) company discharging the untreated wastewater into the environment. After this disaster, policy makers have numerous activities which increasingly strict regulars punishing environmentally harmful behaviors.
These policies have encouraged producer to control the impacts of their activities on the natural environment to mitigate negative reputation and addition cost. Thus, responding to the incremental of environment pressure, manufacturer use GI that considered important tool to obtain sustainable development. Despite the significance and benefits of GI, many case, the contribution of producer in GI have below expectation (Abdullah, Zailani, Iranmanesh, & 7 : skknchat@gmail.com TIEU LUAN MOI download Jayaraman, 2016). Some manufactures are prevented by innovation participation because of the difficulties involved and still locked into the established routines.
To achieving adoption of GI, these were important factors, which include stakeholder compression, environmental protection act, firm size, and characteristics of manager, staffs and business field (González, 2006; and Etzion, 2007). Although GI, and GE literatures are plentiful, relatively little research attention has been focused on Vietnam industry. The economic, social, community, market conditions of Vietnam are almost different from other areas. The composition of customers and their preferences are changing swiftly, thus formed market turbulence.
Moreover, Vietnam’s industries are mostly involved in SMEs, which play important roles in national market, and contributed over 40% GDP (Hoang, 2016). According to the report by General Statistics office, in 2017, there are nearly 517,900 SMEs operating in the country, up 51.6% compared to 2012, of which SMEs account for 98. They have allocated almost in Ho Chi Minh city on which 172,979 SMEs are operating. In global market, SMEs contribute to the economic growth and competition (Mesquita & Lazzarini, 2008).
SME activities allow SMEs to remain competition, meeting requirements of customers, promoting innovation. The important role of SMEs that present in wealth, job production, thus generating consequence and producing a set of services and products. However, their limited resources and capabilities in the area of human, financial resources, and research, and marketing, thus they will fall without globalizing their activities. In the market turbulent conditions, the globalization of environmental pressures, which made the role of SMEs more eminent.
However, the question is whether confirming the development of SMEs 8 : skknchat@gmail.com TIEU LUAN MOI download form GE approach, which stem form GI in turbulent market conditions? In this thesis, the development of SMEs comprise of incremental employment, performance of finance, and the newborn industries (Mangematin et al. Confidently, concluding that SMEs development and turbulent market conditions have not received attention in previous studies. Based on the massive literature review that has disclosed a clear gap in evidence on the growth of SMEs from GI, and GE in market turbulence is confirmed. Based on advances that mentioned above, so the activating of SMEs activities in Ho Chi Minh business City is corresponded to the demographic census of this study.
At firm level, GI has been research in two specific aspects. According to study of (Caputo, 2014), his study investigated factors related to enable GI, which focus on stakeholder pressures, environmental protection acts, redundant resources expected economic benefits, employees and environmental awareness of managers. The other aspect focuses on the outcome of GI. Many studies debated on how policies driven GIs influence innovation and firm performance.
Porter & Van der Linde, 1995) provided appropriate conclusion which indicated relationship or mechanism between GI and corporate performance. In general, his hypothesis indicates innovation-offset term. Thus, the company increasing in resource efficiency leads to higher economic efficiency. The impact of corporate GI on firm performance is undisputed conclusion, some empirical studies indicate the positive effect of corporate GI on business performance (Amores et al 2014; Rennings & Rammer, 2011).
In some case this effect was costing in short term but become positive in long term (Horváthová, 2012). However, identifying and classifying GI activities of firm 9 : skknchat@gmail.com TIEU LUAN MOI download should consider the significant barriers. Beside some companies have inadequate capacities, which reduce their proper understanding of GI’s measure. Previously, the factors influence to implementation of GI of firm, have been examined in some studies (Y.
Lin, Tseng, Chen, & Chiu, 2011; Tseng, 2013). Therefore, GI can be classified into four main categories, including technological innovation, process innovation, performance of management, and product design. Klassen & Whybark (1999) presented an array of Green measures help manufacturer adjust processes in design of product to diminish environmental negative consequences. Moreover, well-designed environmental standards can develop an incentive of producer to introduce green products with lower cost and differentiating (Chen, Lai, & Wen, 2006).
Thus, GI improve product or processes that reaching sustainability and the bargain of environmental pressures. Rennings & Rammer (2011) and Kemp & Pearson (2007) studies indicated that GI can significantly decrease environmental pollution and thus can create sustainable development. In Vietnam, compared to other developing countries, environmental pollution has not deal efficiency, cause by serious measures have not adopted, especially in field of making and consumption of green products (Lin et al, 2013). This study presented the original topic deliberated on the theme of GI and green manufacturing.
According to this matter, this study accesses an emerging phenomenon, which call Green entrepreneurship (GE). The GE approach is an outcome of innovation, which has the potential to solve environmental problem by create new product and technology (York & Venkataraman, 2010). GE considers sustainability is the strategic foundation, which is related with sustainable economy. Since the global economic 10 : skknchat@gmail.com TIEU LUAN MOI download crisis in 2009, national plans and the report of international meeting obviously utilized the concept of green economy.
According to UNEP, this report seen green economy or sustainable economy is an economic activities system which aim to develop value of people’s life. This system embraces the manufacture, consumption, and allocation of goods and services. In the green economy model, a priority focus to environmental issues and sustainable businesses (UNEP, 2011). Thus, a prevention imminent generation against primary environmental risk and natural scarcity is considered essential aspect of GE.
Uslu, Hancıoğlu, & Demir (2015) presented that GE encouraging manufacturer using re-generable energy resources, recycling of wastes, and more attention to animal and organic farming. Kirkwood & Walton (2010) presented that the motivation of eco-preneurs or green entrepreneurs is created sustainable businesses with strong underlying green values. It’s made green entrepreneurs are extraordinary in the world of business. The original credence of entrepreneur focuses on the primariness of the environmental and social consciousness more than rigorous economic achievement.
Thus green entrepreneurs are tremendous significance to the economy as job creation is their crucial contribution (Farinelli, Bottini, Akkoyunlu, & Aerni, 2011). Base on his review, Silajdžić, Kurtagić, & Vučijak, (2015) investigated in private sector that green entrepreneur brings positive influences on society and gains desired business’s profitability also. Activities of green entrepreneur consequently develop sustainability for industries and enhance the green growth (Sarkar, 2013). The above-mentioned studies indicated the importance rule of GI and GE in the modern world.com TIEU LUAN MOI download Based on the benefit of GI, GE, on development of Vietnam’s SME which mentioned above.
This thesis aims to offer a comprehensive approach in assessing GI. Moreover, the conclusion of this study aims to evaluate the impact of GE on development of SMEs in market turbulence conditions.