Social capital’s role in aiding success for SMEs in Vietnam

Abstract

Based on the survey on SMEs conducted by GSO in Vietnam, the sample of 2,647 SMEs is concerned in this study. Using the quantitative model of ERM, the results bring the interesting finding, revealing the endogenous role of social capital in the relationship between innovativeness, entrepreneurial orientation, E-business (E-business hereby is defined as any commercial or administrative transaction or information exchange made available through the internet (Moodley, 2003; Wang and Cheung, 2004) and SME’s performance. The quantitative method confirms the existence of endogenous social capital, as well as highlighting the importance of innovativeness, entrepreneurial orientation and E-business contributed to the firm performance. In addition, the study found social capital is dominated by young people and the gender of females. Accordingly, the younger, the more dynamic for social capital. In addition, the female owners/directors/managers have more advantages in leveraging social capital compared to their male colleagues. In addition, the finding of the dissertation also derived a new point compared to other studies is the inclusion of endogenous factors in the ERM model, in which the social capital is a recognized endogenous variable after performing the test. There have been many published papers, research and surveys about Innovativeness, Entrepreneurial orientation, or E-business as well as social capital, however the combination of these 4 components in a research model does not seem to be interesting, this is also one of the research gaps we tried to fulfill. The research results, besides making academic contributions to the field of professional research, also contribute to the development of more effective policies to develop SMEs in the region, in which the above factors are taken into account.