Qualitative research: the author uses expert interviews to identify and select operations management practices impacting on business performance suitable for mechanical businesses in Vie
Trang 1FOREIGN TRADE UNIVERSITY FACULTY OF POSTGRADUATE STUDY
MECHANICAL ENTERPRISES IN VIETNAM
Major: Business Administration
DAO MINH ANH
Hanoi, 2020
Trang 2This thesis is completed at: Foreign Trade University, 91 Chua Lang, Dong Da, Hanoi
Supervisor: Assoc Prof, Dr Nguyen Van Minh
Reviewer 1:
Reviewer 2:
Reviewer 3:
Thesis defense will be opened at the University’s Thesis Committee At
At o’clock date month year
The thesis can be viewed at National Library or Foreign Trade University Library
Trang 3PAPERS RELATED TO THESIS’ TOPIC
I Foreign Journal
1 Dao Minh Anh, Impact of Operations Management Practices on Firm
Performance: An Empirical Analysis at Vietnam’s Mechanical Firms,
International Journal of Business & Applied Sciences, Vol 9 No 1, pp 13-21, 2020 ISSN: 2165-8072 (Đồng tác giả)
II Domestic Journals
2 Đào Minh Anh, Mối liên hệ giữa các yếu tố QTSX cốt lõi và kết quả HĐKD: Nghiên cứu điển hình các doanh nghiệp cơ khí tại Việt Nam, Tạp
chí Kinh tế đối ngoại, 121(9/2019), 46-63, 2019
3 Đào Minh Anh, Tầm quan trọng của các yếu tố QTSX đối với các doanh nghiệp cơ khí tại Việt Nam, Tạp chí Khoa học – Đại học Đồng Nai, 15(2019), 1-16, 2019
III International Conference
4 Dao Minh Anh, Best business practices and firm performance in the context of Vietnam’s manufacturing industry, The 2nd Asia Pacific Management Research Conference “Innovation and Strategic Alliance for Sustainable Development” APMRC 2018, Proceedings of the Conference organized by PPM School of Management and Hanoi University of Science and Technology, Foreign Trade University, Vietnam National University, Sept 2018, pp.125-138, 2018
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INTRODUCTION
1 Rationale of the research
In Vietnam, mechanical industry has been seen an essential industry, which plays
an important role in the industrialization and modernization of the country In the development strategy of mechanical industry up to 2025, with a vision to 2035, the industry is planned to with the majority of advanced technologies, high quality products with international standards, deeper participation in global value chains, highly disciple and productive labor force, active in reseach, design and manufacturing, basically meet the demand for mechanical products of the domestic market (Prime Minister, 2014)
In the context of mechanical industry in Vietnam today, it is necessary to identify the critical operations management practices that affect the business performances of enterprises According to the author’s research, at the present, there have been many different studies on mechanical enterprises, the application of quality management models such as 5S, Kaizen, but there has not been one Which topics will research and identify the critical operations management practices of mechanical enterprises in Vietnam? The identification of those practices affecting to business performance is very significant for mechanical enterprises, helping them to improve the business result, thereby improving their ability and competitive advantage of the business,
Therefore, the doctoral student has chosen the issue “Study on the critical
operations management practices affecting business performance of mechanical enterprises in Vietnam” as her thesis topic
2 Research situation
From the summary and analysis of the overview of the research, it can be seen that the role as well as the importance of operations management practices in Vietnamese enterprises in general, mechanical enterprises in particular have not been evaluated properly; leading to failure of achieving business results according to the set plan, causing the risk of further lagging in the industry in general, and the loss of competitive advantage of Vietnamese mechanical enterprises in particular, compared to other regional countries and the world At the same time, previous studies only stopped at individual research in specific areas of corporate governance, but did not study how the combination of elements of operations management will affect business results of enterprises Therefore, the study of operations management practices suitable to the characteristics of Vietnamese mechanical enterprises is an urgent issue not only for researchers but also for enterprises themselves, for policy planning, in order to help businesses identify the critical operations management practices that help businesses
Trang 5improve their operating results, focus on investing resources and create a competitive advantage in the market
3 Research objectives and tasks
4 Objects and scope of the research
as follows: product quality, cost of production, on-time delivery, flexibility in changing the number of products produced, and customer satisfaction
- Space
The topic focuses on operations management practices in mechanical enterprises
in Vietnam Mechanical enterprises are in Group C, belonging to processing industry,
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manufacturing industry codes from 24-30 according to Decision No 10/2007 / QD - TTg dated January 23, 2007 of the system The mechanicl enterprises are small, medium and large (equivalent to the number of employees from 10 people or more) At the same time, these businesses have a history of three years or more
- Time
Research focuses on production management system with JIT practices, quality management practices and infrastructure practices for business operation, applied and implemented in enterprises from 2010-2018
5 Research methods
The author uses qualitative and quantitative research methods to achieve research purposes and answer the research questions of the thesis Qualitative research: the author uses expert interviews to identify and select operations management practices impacting on business performance suitable for mechanical businesses in Vietnam At the same time, after identifying the critical operations management practices, the author also conducted a second expert interview to confirm the business performance Quantitative research: the author uses surveys The first survey to determine the role of the core operations management practices and business performance for mechanical enterprises in Vietnam to complete the research model The second survey to find out the current situation of applying critical operations management practices and business performance in mechanical enterprises in Vietnam, assessing the classification and identification of the critical operations management practices affecting business performance of the enterprises
6 Thesis’ main results and contribution
6.1 Main results
-The first research result: preliminary determination of 14 suitable operations management practices and 2 groups of business performance for the research model of the thesis
- The second research result: general identification of critical operations management practices impacting business performance suitable for mechanical enterprises in Vietnam through expert interviews and survey
- The third research result: identifying the level of implementation of operations management practices and 2 groups of business performance in 62 mechanical enterprises in Vietnam through the questionnaire survey The author has classified them into two groups of high and low implementation The research results show that the group of enterprises that carry out a high level of implementing operations management
Trang 7practices will have higher business performance than the group of enterprises
performing at a low level This result has been tested and statistically significant
- Fourth research result: identifying the critical operations management practices,
as well as the degree of impact of each practice on business performance through quantitative research model These practices include: Facility layout; Supplier quality management, Information and feedback; Kanban; Cleanliness
- The fifth research result: Proposal to propose successful application of critical operations management practices to mechanical enterprises in Vietnam
6.2 New contributions in theory and practice of the thesis
Contribution in theory
Firstly, the thesis has systemized the literature related to critical operations management practices, business performance designed research and proposed scientific research methods to identify the critical operations management practices affecting business performance suitable for mechanical businesses in Vietnam This is an important academic contribution of the thesis Secondly, the thesis has proposed a research model of critical operations management practices affecting business performance suitable for mechanical enterprises in Vietnam This model has contributed
to the theoretical basic system when studying operations management and its impact on operating results in the context of mechanical enterprises in Vietnam
Contribution in practice
Firstly, the thesis analyzes and assesses the reality of applying the critical operations management practices and business performance in mechanical enterprises in Vietnam comprehensively Second, the thesis identifies the critical operations management practices, as well as the degree of impact of each practice on business performance Thirdly, the thesis proposes highly practical and scientific recommendations based on the above mentioned critical operations management practices
7 Structure of the thesis
- Chapter 1: Theoretical basis of the critical operations management practices and
business performance in the enterprise
- Chapter 2: Research design
- Chapter 3: General identification of the critical operations management practices affecting business performance in mechanical enterprises in Vietnam
- Chapter 4: Analyze and identify the critical operations management practices affecting business performance in mechanical enterprises in Vietnam
- Chapter 5: Recommendations to use the critical operations management practices for mechanical enterprises in Vietnam
Trang 85
CHAPTER 1: THEORETICAL BASIS OF THE CRITICAL OPERATIONS MANAGEMENT PRACTICES AND BUSINESS PERFORMANCE IN THE
ENTERPRISE 1.1 Critical operations management practices in the enterprises
1.1.1 Some definitions
Production and Production Process
Stevenson (2009, p28) introduced manufacturing as one of the three most basic functions of an enterprise, responsible for producing products for the business
“The productions process is the process of converting inputs into outputs Inputs include materials, labor, machinery, capital, information, etc that are used in the production process to create the product” (Stevenson, 2009, t28)
Operations Management
According to Truong Doan The (2007), operations management is the process of designing, planning, operating and monitoring the production system in order to realize the production targets In particular, the central element of production value is the transformation process It is the process of processing, converting inputs into desired goods or services, meeting social needs
Critical Operations Management Practices
In operations management, the critical operations management practices are the practices that work best for the production system of the enterprise, helping to bring high operating results, thereby improving the competitiveness of enterprises (Voss and Blackmon, 1994 - cited from Davies and Kochhar, 2002) In this thesis, using the concept of "critical operations management practices" is the mode of operation appropriate to the conditions of the enterprise and when doing them methodically, the enterprise will achieve high business performances and growth
1.1.2 Critical operations management practices
From a strategic competitive point of view, a well-thought-out production system will be one of the company's core competencies, a weapon to reduce production costs and improve business efficiency The application of JIT practices and other practices is considered necessary to help businesses control inventory and create a superior production system
1.1.2.1 Just-in-time Practices – JIT Practices
The author will select the factors with high frequency of use in the studies: (1) Daily
schedule adherence; (2) Facility layout; (3) JIT delivery by suppliers; (4) Kanban; (5) Setup time reduction
1.1.2.2 Quality Management Practices
Trang 9Cleanliness and organization; Customer focus; Maintenance; Process control; Supplier quality management
1.2.2 Financial Business Performance
In studies of financial performance and its relationship with corporate governance factors, some commonly used indicators Revenue growth is an indicator of relative revenue growth over time Profit growth is an indicator of relative profit growth over time
1.2.3 Non-Financial Business Performance
- Conformance of product quality
- Cost of production
- On-time delivery
- Flexibility in volume changed
1.3 Relationship between critical operations management practices and business performance
1.3.1 Relationship between critical operations management practices and business performance in the project of High Performance Manufacturing – HPM)
Cua et al (2001) confirmed the combination of production practices (quality management, production organization, maintaining overall productivity, human resource management, strategy and contextual factors) The core will help make the production program of the business more efficient
Ahmad et al (2003) studied the role of infrastructure practices in the effectiveness of JIT production organization application
Cua et al (2006) used a comprehensive program of comprehensive quality management (TQM) elements, organized production according to JIT and maintained overall productivity (TPM) to study their impact on operating results at 163 factories
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Matsui (2007) also focuses on the study of an integrated production system, which emphasizes the combination of production organization elements with quality management, production information systems, and industrial development, technology and production strategy, human resource management and their relationship with business results at 46 Japanese factories
The research of Battistoni and Bonacelli (2013) also combines production practices (in terms of both production and supply), the influence of firm size on the application of production elements, and the relationship The relationship between operations management practices and production and business results in 100 small and medium-sized enterprises in Italy The results show that firm size does not affect the application of operations management practices, as well as a positive relationship between operations management practices and business performance
1.3.2 Relationship between critical operations management practices and business performance in Southeast Asian countries
1.3.2.1 Researches in Thailand
Rahman et al (2010) also studied the impact of operations management practices
on business performance The study was conducted at 187 manufacturing enterprises in Thailand, including large, medium and small-sized enterprises of all types owned by Thailand, 100% foreign-owned companies and joint-venture companies In Seedee's study (2012), the author selected 169 manufacturing enterprises in Thailand, using the management practices of the "Baldrige National Quality Award Program 2009-2010"
1.3.2.2 Researches in Malaysia
Yusuff (2004) used the best operations management practices based on inheriting the factors of leading producing countries and their impact on financial and non-financial performance, applied to research at electrical and electronic businesses of Malaysisa
Arumugam et al (2008) conducted a survey of 122 enterprises in Malaysia, to answer the question (1) What quality management practices are related to business performance; (2) Which quality management practices are more correlated with business performance
1.4 Approaches to determine critical opeartions management practices affecting business performance
1.4.1 Contingeny theory and Resource-based theory
Context theory is one of the most important theories related to corporate governance This theory holds that the influence of an element is not optimal in every business environment and context
Trang 11Resource-based theory sees businesses as a set of competencies The resources and capabilities of the business are considered as the basis to create a competitive advantage, so if the business makes use of exploiting and promoting them, it will help the enterprise to develop sustainably (Ketokivi and Schroeder, 2004a; Peng et al., 2008) This theory emphasizes the relevance of the external business environment to the resources and capabilities within the enterprise
1.4.2 Best practices
In production, the best operations management practices elements are applied to the production process that businesses choose to support production and business activities The best practices help businesses achieve the highest business performance and become a leading enterprise (World class manufacturing), surpassing and outstripping their competitors
1.5 Factors affecting the selection of research methods for critical operations management practices and business performance
When studying the relationship between the operations management practices and business performance, scholars have pointed out the factors affecting the development
of research frameworks and appropriate research methods (Davies and Kochhar, 2002)
1.5.1 Level of implementing operations management practices
Level of implementing operations management practices is determined using Likert scale (5 or 7 points)
1.6.1 Ideal model method
This method allows to establish a list of operations management practices and business results to measure for companies This method allows comparing groups of heterogeneous companies by building and comparing through a common model
1.6.2 Benchmarking method
Based on the measurement of business results, operating results are usually selected from the enterprises themselves, which achieve high production and business
Trang 12CHAPTER 2: RESEARCH DESIGN
2.1 Research philosophy
This research aims at the theoretical and practical contributions in the field of business management, namely identifying the critical operations management practices affecting the business performance of mechanical enterprises in Vietnam In order to answer the main research question of the topic: What are the critical operations management practices affecting the business performance of mechanical enterprises in Vietnam
In order to carry out the research objectives, this thesis uses both deductive and inductive approaches to inherit the advantages of these two approaches
2.2 Research diagram and procedure
2.2.1 Research diagram
The research diagram (Diagram 2.1) below is used as an outline to help the author guide the research tasks and the method to perform those tasks, thereby achieving research goals
2.2.2 Research procedure
From the above research diagram, the author offers a research procedure to answer the research questions The research process is divided into four stages corresponding to the four main contents of the thesis (Diagram 2.2)
Trang 13Diagram 2.1: Diagram for thesis research
(Source: Author’s self completion)
Study on critical operations management practices affecting business performance of
mechanical enterprises in Vietnam
performance for the research model of the thesis
-Research theoretical basis on OM practices and business performance; Research model of the relationship between OM practices and business performance of
enterprises -The approaches related to the identification of critical OM practices and business
performance -The factors affecting the selection of research methods on the critical OM practices
and business performance
- Methods of researching critical OM practices and business performance
Task 2: General identification of critical OM practices affecting business performance in the context of mechanical enterprises in Vietnam and perfecting the research model
practices and business performance (after applying those factors) in mechanical enterprises in Vietnam
impacting business performance in mechanical enterprises
analysis tools such as
compare, analyze and comment
on OM practices and business
Trang 1411
Diagram 2.2: Research procedure
(Source: Author’s self completion)
and business performance
Period 1
affecting business performance for the research model of the thesis
Step 4: Study the characteristics of production and
business activities of mechanical enterprises in Vietnam
Step 8: Analyze the critical OM practices affecting
business performance of mechanical enterprises in Vietnam.
Step 9: Identify the critical OM practices affecting
business performance of enterprises and their impact level
Step 1: Determine problems, objectives and questions
of the research
mechanical enterprises in Vietnam
Preliminary research model:
14 OM practices
02 groups of business performances
Period 2
RESULTS
- Generally identify the
critical OM practices affecting business performance in the context
of mechanical enterprises in Vietnam;
- Completed research model; -Completed survey questionnaire
The level of implementation
of OM practices; Business performance (when implementing those practices)
Period 3
Period 4
Reliability of the scale; Correlation relationship and impact of OM practices on business performance
05 critical OM practices for mechanical enterprises
Comments and verification
of research results
Proposal for Recommendations of using research results
Trang 152.3 Research methods
2.3.1 Qualitative methods
The qualitative research in this thesis is used to assess the suitability of OM
practices affecting the results of business performance in the conditions of mechanical
enterprises in Vietnam and to verify the research results Specifically, the author uses
expert interview method
2.3.2 Quantitaive methods
In quantitative research, the model and the factors of the thesis are built based on
the theoretical overview, making research hypotheses and verifying the acceptance or
rejection of the hypothesis
2.4 Research model and hypotheses
2.4.1 Research model
Image 2.3: Research Model
2.4.2 Hypothesis
H1: JIT practices have a significant impact on business performance in
mechanical enterprises in Vietnam
H2: QM practices have a significant impact on business performance in
mechanical enterprises in Vietnam
Firm performance
- Financial Performance
(Sales Growth, Profit growth,)
- Non-financial Performance
(Cost of production, conformance
of product quality, on-time delivery, flexibility in volume changed, customer satisfaction)
Commented [H1]: -Giải thuyết nghiên cứu là một phát
biểu mang tính chất tiên lượng (dự báo) về mối quan hệ nhân – quả của một hoặc nhiều nguyên nhân đến biến phụ thuộc Như vậy giả thuyết trên nên phát biểu lại như sau: Giả thuyết H1: Các yếu tố tổ chức sản xuất có ảnh hưởng dương (cùng chiều) đến kết quả kinh doanh
- Lưu ý thêm: Các giả thuyết cần phải biện luận trước khi đưa
ra (ví dụ: Yếu tố tổ chức sản xuất là gì, vì sao/cơ sở để đưa ra tiên lượng là nó có ảnh hưởng cùng chiều đến kết quả kinh doanh,…)
- Tổng hợp các giả thuyết NC chính là mô hình NC, do đó có thể trình bày các giả thuyết NC trước khi đưa ra mô hình NC
Trang 162.4.3 Measurement scales
The scales and variables in the article are inherited from the HPM project The
OM practices have a positive relationship with business performance
2.5 Sampling
2.5.1 Sampling via interview
In the first interview, the author conducted interviews with 05 experts to find out the suitability of OM practices and business performance targets for mechanical engineering enterprises in Vietnam and adjusting the scales and bodies In the second interview, the author re-interviewed 05 experts and leaders of the enterprise to verify the research results, propose and use the research results
2.5.2 Sampling via survey
2.5.2.1 1 st survey
Survey subjects are representatives of enterprises, from department head upwards
or equivalent The survey period is from 15-30 June 2017 The number of questionnaires issued was 35, and 30 were valid, gaining 85.7%
2.5.2.2 2 nd survey
The author uses the questionnaire survey method for employees in the enterprise (from middle management upwards) to assess the level of implementation of OM practices and business performance to test the proposed model and research hypotheses The author uses a stratified sampling method and convenient sampling Of the total number of businesses the author contacted for the survey, 62 agreed to accept the author's permission to conduct the survey The number of enterprises in each industry group is also proportional to the proportion of the above mentioned mechanical enterprises Each author authorizes 3 questionnaires, of which the director and the deputy director of the enterprise will answer all the questionnaires; The remaining: the author will ask for subjects from middle management and above The total number of questionnaires issued was 186, collecting 170 valid ones The survey period is from December 2017 to June 2018 The minimum number of samples required for this study is
