Empirical investigation of supply chain 4.0 adoption in Vietnam

Nguyen, Giang

Abstract

Purpose
The rise of Industry 4.0, also known as the 4th Industrial Revolution, has transformed traditional supply chains into Supply Chain 4.0 (SC4.0), often referred interchangeably as Digital Supply Chains (DSC). This shift is crucial for firms, especially in emerging economies like Vietnam, to maintain their global competitiveness as a manufacturing hub of the global supply chain. However, there is a lack of in-depth research on DSC adoption, with a dearth of empirical evidence and no consensus on a comprehensive framework to explain it. A wide range of papers also overlook the complexity of interorganisational relationships within supply chains and the impact of different organisational culture types on technological innovation adoption. To address these gaps, this study aims to create a theoretical framework for DSC adoption in Vietnam, with the goals of providing a comprehensive understanding and practical insights into the development of policies, strategies, and organisational changes regarding the adoption. To achieve this goal, this study uses the Technology – Organisation – Environment (TOE) framework as the core foundation, incorporating principles of interorganisational relationships into the Environmental factor. Additionally, the study employs the Competing Value Framework (CVF) model to explore the multifaceted impact of flexibility and control organisational culture values on driving digital transformation.

Research design/methodology/approach
Despite a positivist stance, the research employed a mixed-methods approach to explore DSC adoption enablers and barriers and validate its research model. This approach comprised two stages: stage 1 – quantitative stage that involved the conduct of a systematic literature review (SLR) and semi-structured interviews; and stage 2 – quantitative stage that involved the distribution of a large-scale survey. Particularly, in Stage 1, a SLR of 153 articles identifying adoption determinants, and an in-depth examination of organisational culture’s role in technology adoption, informed the development of six main hypotheses and the research model. This model consists of three primary factors with their corresponding dimensions: technological factor (including perceived risks and perceived benefits), organisational factor (including organisational resources and top management’s knowledge and support), environmental factor (including market pressure, market support and interorganisational relationships); as well as a moderation factor which is organisational culture (including control and flexibility types). These constructs were subsequently explored in 14 semi-structured interviews with managers from various Vietnamese companies and analysed using thematic analysis. In Stage 2, the research model and hypotheses were empirically tested using web-based survey data of 292 responses from Vietnamese organisations and analysed through multivariate regressions.

Findings
The quantitative research findings indicate that organisational and environmental factors are crucial determinants of DSC adoption in Vietnamese firms, while the technological factor does not have significant impact on adoption. Specific dimensions of these TOE factors, including perceived benefits, top management knowledge and support, organisational resources, market pressure, and interorganisational relationships, contribute to the success of DSC adoption in Vietnam. Among these determinants, top management knowledge and support, followed by interorganisational relationships are the most influential factors in the successful implementation of DSC. Furthermore, when considering different stages of DSC adoption (adoption intention and adoption actions), perceived benefits, top management knowledge and support, market pressure, and interorganisational relationships significantly predict adoption intention, while organisational resources, top management knowledge and support, market support, and interorganisational relationships significantly determine adoption actions. The findings also highlight the coexistence of control and flexibility values within Vietnamese organisational culture. While this culture plays a positive role in DSC adoption, the interplay of these values, slightly favouring control-oriented values, negatively affects the impact of various factors on DSC adoption, with some exceptions. Despite the advantages of combining control and flexibility values in organisational culture, the study highlights the importance of prioritising flexibility values, with a focus on entrepreneurial, dynamic, and risk-taking attributes within organisations.

Implications
The empirical findings of this research provide valuable insights for managers, enhancing their understanding and informing their decisions regarding DSC adoption and implementation in Vietnam. The study highlights that Vietnamese firms adopt DSC to access real-time market data, facilitate information sharing, and respond effectively to market volatility and price competition. However, despite positive intentions, Vietnamese firms do not always take concrete actions to implement DSC. To initiate DSC adoption, top managers should acknowledge its benefits, eliminate barriers and challenges hindering adoption, and ensure that their firms are fully aware of the costs, complexities, and potential risks associated with digital transformation. The research also highlights the paramount importance of top management’s support and knowledge in driving DSC implementation. This requires managers to be willing to take financial and operational risks, develop clear strategies and roadmaps for digital transformation, communicate its urgency across the organisation, allocate a sufficient and realistic budget aligned with digital transformation goals, and guide and support employees. Moreover, organisations can enhance their employees’ technical proficiency through in-house digital skill training programs or by outsourcing third-party training to address the changing requirements for new roles and skills in digital technology adoption. In addition, in response to the need for rapid adaptation to market demand changes, managers should regularly reassess digital transformation strategies to align with market dynamics and customer demands. It is essential for organisations and managers to stay well-informed about and actively engage in government programs and national digital transformation policies. Exploring research and networking opportunities with external organisations can also uncover potential support programs, funding opportunities, and partnerships. Additionally, in the complex process of digital transformation, it is crucial for organisations and managers to proactively cultivate and maintain trust-based relationships with their trading partners. This involves establishing common digital objectives, promoting the exchange of information, knowledge, best practices, and insights from successful digital transformation experiences for mutual benefit.

Originality/value
This research addresses the existing gap regarding the limited attention given to the impact of Industry 4.0 in SCM and the absence of comprehensive literature review that can offer valuable insights into the development state of DSC research. It achieves this by conducting a thorough systematic literature review (SLR) of the enablers and barriers of SC 4.0, considering both Industry 4.0 and SC 4.0 perspectives which is a pioneering effort that offers valuable insights into the state of DSC research. This study is particularly significant in the context of developing economies like Vietnam, as it not only theoretically specifies and but also empirically tests a novel research model that integrates the Technology – Organisation – Environment (TOE) framework and the concept of interorganisational relationships to investigate the enablers and barriers of DSC adoption. This research also identifies the critical determinants for measuring TOE factors that are tailored to the unique context of Vietnam. Furthermore, it examines the moderating role of flexibility-control organisational culture values on the impact of these determinants on DSC adoption which had until now not been fully explored in the literature. This research also provides a comprehensive approach to DSC adoption and advances the field of technology adoption by analysing how various factors influence different stages of DSC adoption. In summary, this study lays a strong foundation for future DSC research, both in terms of its theoretical and practical implications.

Citation

Nguyen, G. Empirical investigation of supply chain 4.0 adoption in Vietnam. (Thesis). University of the West of England. Retrieved from https://uwe-repository.worktribe.com/output/11470630

• Thesis Type: Thesis
• Deposit Date: Nov 30, 2023
• Publicly Available Date: Jun 5, 2024
• Keywords: Supply chain 4.0, Industry 4.0, Enablers, Barriers, Vietnamese firms, Digital transformation, Technology adoption, Organisational culture, Flexibility culture, Control culture
• Public URL: https://uwe-repository.worktribe.com/output/11470630
• Award Date: Jun 5, 2024