IDEAS home Printed from https://ideas.repec.org/a/jed/journl/v45y2020i1p61-81.html
   My bibliography  Save this article

Innovation: From Capabilities to Performance in Manufacturing Enterprises in Vietnam

Author

Listed:
  • Bui Quang Hung, Trinh Thuy Anh and Nguyen Ngoc Thong

    (University of Economics Ho Chi Minh City, Ho Chi Minh City Open University, Vietnam)

Abstract

TThis paper examines the impact of innovation capabilities on innovation performance and firm performance of the manufacturing industry. Innovation capability as the firm's ability to reconfigure and develop its resources and organizational capabilities to innovate. Innovation capability has four components: sensing capability, combination capability, networking capability, and learning capability. The innovation performance is the achievement or success of innovation made by a firm by the target, describes the concept of the three components: internal performance, commercial performance, and social performance. Performance has three components: finance, customer, and employee. The research methods used in this study are Structural Equation Modeling (SEM) and Fuzzy-set Qualitative Comparative Analysis (fsQCA). Participants in the questionnaire include 205 directors, CEO of manufacturing enterprises in Ho Chi Minh City and Binh Duong City. SEM result shows that there is a positive effect of innovation capacity and innovation performance on firm performance. However, the result of fsQCA shows that the combination of components (innovation capability and innovation performance) constitutes sufficient conditions for the presence of the firm performance.

Suggested Citation

  • Bui Quang Hung, Trinh Thuy Anh and Nguyen Ngoc Thong, 2020. "Innovation: From Capabilities to Performance in Manufacturing Enterprises in Vietnam," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 45(1), pages 61-81, March.
    • Handle: RePEc:jed:journl:v:45:y:2020:i:1:p:61-81
    as

    Download full text from publisher

    File URL: http://jed.or.kr/full-text/45-1/4.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Vo, Xuan Vinh & Nguyen, Dong Phong & Ho, Viet Tien & Nguyen, Trung Thong, 2017. "Where do the advanced countries invest? An investigation of capital flows from advanced countries to emerging economies," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 51(C), pages 142-154.
    2. Arnoud Meyer & Sam Garg, 2005. "Innovation in Asia," Palgrave Macmillan Books, in: Inspire to Innovate, chapter 1, pages 1-11, Palgrave Macmillan.
    3. Minna Saunila & Sanna Pekkola & Juhani Ukko, 2014. "The relationship between innovation capability and performance," International Journal of Productivity and Performance Management, Emerald Group Publishing Limited, vol. 63(2), pages 234-249, January.
    4. Lau, Antonio K.W. & Lo, William, 2015. "Regional innovation system, absorptive capacity and innovation performance: An empirical study," Technological Forecasting and Social Change, Elsevier, vol. 92(C), pages 99-114.
    5. Xuan Vinh Vo & Huu Huan Nguyen & Khanh Duy Pham, 2016. "Financial structure and economic growth: the case of Vietnam," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 6(2), pages 141-154, August.
    6. Arnoud Meyer & Sam Garg, 2005. "Inspire to Innovate," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-51206-1, December.
    7. Lin, Hai-Fen & Su, Jing-Qin & Higgins, Angela, 2016. "How dynamic capabilities affect adoption of management innovations," Journal of Business Research, Elsevier, vol. 69(2), pages 862-876.
    8. Benn Lawson & Danny Samson, 2001. "Developing Innovation Capability In Organisations: A Dynamic Capabilities Approach," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 5(03), pages 377-400.
    9. Xuan Vinh Vo & Hong Thu Bui, 2016. "Asset growth and the cross section of stock returns - evidence from Vietnam," Afro-Asian Journal of Finance and Accounting, Inderscience Enterprises Ltd, vol. 6(4), pages 289-304.
    10. Kathleen M. Eisenhardt & Jeffrey A. Martin, 2000. "Dynamic capabilities: what are they?," Strategic Management Journal, Wiley Blackwell, vol. 21(10‐11), pages 1105-1121, October.
    11. Dong Phong Nguyen & Xuan Vinh Vo, 2017. "Determinants of bilateral trade: evidence from ASEAN+3," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 31(2), pages 115-122, November.
    12. Thi Mai Hoai Bui & Xuan Vinh Vo & Duy Tung Bui, 2018. "Gender inequality and FDI: empirical evidence from developing Asia–Pacific countries," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 8(3), pages 393-416, December.
    13. Jonathan Batten & Xuan Vinh Vo, 2009. "An analysis of the relationship between foreign direct investment and economic growth," Applied Economics, Taylor & Francis Journals, vol. 41(13), pages 1621-1641.
    14. Vo, Xuan Vinh & Truong, Quang Binh, 2018. "Does momentum work? Evidence from Vietnam stock market," Journal of Behavioral and Experimental Finance, Elsevier, vol. 17(C), pages 10-15.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pham Ngoc-Tham & Pham Trung-Kien & Cao Viet Hieu & Tran Ha Giang & Vo Xuan Vinh, 2020. "The Impact of International Trade on Environmental Quality: Implications for Law," Asian Journal of Law and Economics, De Gruyter, vol. 11(1), pages 1-12, April.
    2. Xiangyu Chen & Muhammad Safdar Sial & Dang Khoa Tran & Waseem Alhaddad & Jinsoo Hwang & Phung Anh Thu, 2020. "Are Socially Responsible Companies Really Ethical? The Moderating Role of State-Owned Enterprises: Evidence from China," Sustainability, MDPI, vol. 12(7), pages 1-19, April.
    3. Marlenne G. Velazquez-Cazares & Anna M. Gil-Lafuente & Ernesto Leon-Castro & Fabio Blanco-Mesa, 2021. "Innovation capabilities measurement using fuzzy methodologies: a Colombian SMEs case," Computational and Mathematical Organization Theory, Springer, vol. 27(4), pages 384-413, December.
    4. María Isabel Camio & María Del Carmen Romero & María Belén Álvarez & Alfredo José Rébori, 2018. "Distinctive Innovation Capabilities of Argentine Software Companies with High Innovation Results and Impacts," Administrative Sciences, MDPI, vol. 8(2), pages 1-22, April.
    5. Wang, Changfeng & Hu, Qiying, 2020. "Knowledge sharing in supply chain networks: Effects of collaborative innovation activities and capability on innovation performance," Technovation, Elsevier, vol. 94.
    6. Dung Phuong Hoang and Thong Huy Vu, 2020. "Debit Card Usage as a Rational Choice: The Moderating Effect of Cash Habit," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 45(1), pages 159-183, March.
    7. Xuan Vinh Vo, Thi Tuan Anh Tran and Van Thang Nguyen, 2020. "Investigating the Economic Relationship between Provinces in Vietnam:A Spatial Regression Approach," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 45(1), pages 47-60, March.
    8. VPhuong V. Nguyen, Khoa T. Tran, Nga Thuy Thanh Le and Hoa Doan Xuan Trieu, 2020. "Examining FDI Spillover Effects on Productivity Growth: Firm-Level Evidence from Vietnam," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 45(1), pages 97-121, March.
    9. Agata Sudolska & Justyna Łapińska, 2020. "Exploring Determinants of Innovation Capability in Manufacturing Companies Operating in Poland," Sustainability, MDPI, vol. 12(17), pages 1-21, August.
    10. Hafeez, Salima & Rana, Asif Mehmood & Chaudhry, Rashid Mehmood & Khan, Muhammad Aslam & Ahmad, H.Mushtaq & Rehman, Kashif Ur, 2011. "Perspectives of entrepreneurial orientation with the quality of life," MPRA Paper 53860, University Library of Munich, Germany.
    11. Schriber, Svante & Löwstedt, Jan, 2015. "Tangible resources and the development of organizational capabilities," Scandinavian Journal of Management, Elsevier, vol. 31(1), pages 54-68.
    12. Ayuso, Silvia & Rodriguez, Miguel A. & Ricart, Joan E., 2006. "Using stakeholder dialogue as a source for new ideas. A dynamic capability underlying sustainable innovation," IESE Research Papers D/633, IESE Business School.
    13. Cleverton Rodrigues Fernandes & André Gustavo Carvalho Machado, 2019. "Technology Transfer Capability: development dynamics in higher education institutions," Brazilian Business Review, Fucape Business School, vol. 16(1), pages 1-15, January.
    14. Lütjen, Heiner & Schultz, Carsten & Tietze, Frank & Urmetzer, Florian, 2019. "Managing ecosystems for service innovation: A dynamic capability view," Journal of Business Research, Elsevier, vol. 104(C), pages 506-519.
    15. Szuster Mariusz & Szymczak Maciej, 2016. "Innovation, knowledge and information management in supply chains," Engineering Management in Production and Services, Sciendo, vol. 8(1), pages 26-36, March.
    16. Abel Duarte Alonso & Seng K. Kok & Seamus O'Brien, 2019. "Understanding Approaches To Innovation Through The Dynamic Capabilities Lens: A Multi-Country Study Of The Wine Industry," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 23(06), pages 1-30, August.
    17. Yu-Shan Chen & Yu-Hsien Lin & Ching-Ying Lin & Chih-Wei Chang, 2015. "Enhancing Green Absorptive Capacity, Green Dynamic Capacities and Green Service Innovation to Improve Firm Performance: An Analysis of Structural Equation Modeling (SEM)," Sustainability, MDPI, vol. 7(11), pages 1-19, November.
    18. Domingo García Pérez-De-Lema & Peter Bent Hansen & Antonia Madrid-Gujjarro & Jane Lucia Silva-Santos, 2019. "INFLUENCE OF THE BUSINESS ENVIRONMENT IN THE DYNAMICS OF INNOVATION AND IN THE PERFORMANCE OF SMEs," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 23(05), pages 1-25, June.
    19. Molden, Lars Hovdan & Clausen, Tommy Hoyvarde, 2021. "Playing 3D chess, or how firms can thrive under complexity: The mediating role of innovation capabilities in the use of innovation input," Journal of Business Research, Elsevier, vol. 125(C), pages 1-13.
    20. Małgorzata Kosała, 2015. "Innovation Processes as a Stimulant of Internationalisation Process of Firms," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 3(2), pages 65-84.

    More about this item

    Keywords

    Innovation Capability; Innovation Performance; Firm Performance;
    All these keywords.

    JEL classification:

    • M00 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - General - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jed:journl:v:45:y:2020:i:1:p:61-81. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sung Y. Park (email available below). General contact details of provider: https://edirc.repec.org/data/eccaukr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.