Software developers’ capabilities and entrepreneurial intention in ICT industry: A Vietnamese case

A Thesis for the Degree of Master

Software Developers’ Capabilities and

Entrepreneurial Intention in ICT Industry:

A Vietnamese Case

By

Doan Thi Thanh Hien

Department of Management Information Systems

Graduate School

GYEONGSANG NATIONAL UNIVERSITY

August, 2018

Software Developer’s Capabilities and

Entrepreneurial Intention in ICT Industry:

A Vietnamese Case

A Thesis Submitted to the Faculty of the Graduate School

of the Gyeongsang National University

By DOAN THI THANH HIEN

In partial fulfillment of the requirements

for the degree

of Master in Management Information Systems

August, 2018

Prof. Sung Eui Cho, Thesis Supervisor

Approved by the Committees of the Graduate School

of Gyeongsang National University in Partial Fulfillment

of the requirements for the degree

of Master of Business Administration

Dissertation Committee:

Chairperson

Date: . .

Division of Management Information Systems

Graduate School

GYEONGSANG NATIONAL UNIVERSITY

ACKNOWLEDGMENTS

I came to Korean to study Master in the department of Management Information systems

from 2 years ago. For me in this time, studying in other country is interesting experience but also

difficult for me. To this time, if it were not for the unconditional love, generosity, support and

guidance from many people, I most certainly would not be the happy, optimistic, and confident

person I am today. Undertaking this Master in the department of Management Information systems

means a great deal to me. While I cannot individually thank everyone in this small part, I want

each of him or her to know that they have and continue to teach and inspire me on a daily basis.

Firstly, I would like to express my sincere gratitude to my advisor Prof. Sung Eui Cho for the

continuous support of my Master study and related research, for his patience, motivation, and

immense knowledge. His guidance helped me in all the time of research and writing of my thesis

and papers. I could not have imagined having a better advisor and mentor for my Master study.

Secondly, I must express my gratitude to all professors in my department: Prof. Han-Seong

Yoon, Prof DaeYul Jeong, Prof. Dong Hee Yoo, Prof Jong Hwan Sub and Prof. Buyng-Huyk Ahn.

Thank you for presenting a great lectures, all great suggestions and advices with tons of helpful

and academic knowledge for me and other students.

Thirdly, I would like to thank all friends in Korean, my labmates and my classmates who

together share time, knowledge with me. Their friendliness makes me feeling as I stayed at home.

Especially, I am very grateful to Dr. Motahareh Zarefard who strongly assists me in my study as

well as in all of my difficulties when staying in Korea. Her prompt inspirations, timely suggestions

with kindness, enthusiasm and dynamism have enabled me to complete my papers and thesis.

Thank you for being my teacher, friend and my older sister.

Last but not least, I owe my special thanks to my parents and my family who always stay by

my side all my life. Thank you for being so patient to me, for never giving up on me no matter

what happens. Especially, I want to thanks two important people in my life, it is my mother- Prof.

Dinh Ngoc Lan and my husband. I feel a deep sense of gratitude and admire to my mother who

was spend all her life for me and formed part of my vision and taught me the good things that

really matter in life. The lectures of my mother still provide persistent inspiration for my journey

in this life. I love my mother and thank her so much. Finally, I must express my gratitude to my

husband Mr Nguyen Duc Quang who always support and encouragement me in my life and my

work also.

Doan Thi Thanh Hien

CONTENTS

ABSTRACT

I. Introduction.......................................................................................................................... 1

II. Background........................................................................................................................... 3

1. Literature review.............................................................................................................. 4

1.1. Software developer’s capabilities............................................................................ 4

1.2. Entrepreneurial intention (EI)................................................................................ 5

2. Developing proportions ................................................................................................... 8

3. Research model .............................................................................................................. 28

III. Empirical study ................................................................................................................ 29

1. Data collection ................................................................................................................ 29

2. Measurement model development................................................................................ 34

IV. Result of Analysis............................................................................................................. 36

1. Reliability and validity................................................................................................... 37

1.1. Exploratory factor analysis (EFA)........................................................................ 39

1.2. Confirmatory factor analysis (CFA) .................................................................... 41

2. Test of structure model.................................................................................................. 44

3. Hypotheses test............................................................................................................... 46

4. Comparison model test .................................................................................................. 50

V. Summary of the Results................................................................................................... 53

1. Discussions and conclusions.......................................................................................... 54

2. Limitations ..................................................................................................................... 56

3. Future research .............................................................................................................. 57

REFERENCES........................................................................................................................... 58

APPENDIX I .............................................................................................................................. 73

APPENDIX II............................................................................................................................. 78

LIST OF TABLES

Table 1: Summary of definition.................................................................................................. 8

Table 2: Profile of respondents................................................................................................. 30

Table 3: KMO and Bartlett's Test............................................................................................ 39

Table 4: Exploratory Factor Analysis for independent variables ......................................... 40

Table 5: Obtained of Confirmatory Factor Analysis( CFA).................................................. 42

Table 6: Confirmatory Factor Analysis (CFA) ....................................................................... 43

Table 7: Correlations................................................................................................................. 45

Table 8: Overall model fit.......................................................................................................... 46

Table 9: Hypothesis test results ................................................................................................ 48

Table 10: Analysis result of comparison model....................................................................... 51

LIST OF FIGURES

Figure 1: Research model.......................................................................................................... 29

Figure 2: Result of analysis ....................................................................................................... 48

Figure 3: Result of comparison model without mediating factor .......................................... 51

Figure 4: Result of comparison model with entrepreneurial self-efficacy............................ 52

Figure 5: Result of comparison model with entrepreneurial motivation.............................. 52

ABSTRACT

This study investigates the relationship between entrepreneurs’ capabilities and start-up

intentions in software industries particularly focusing on software developers’ capabilities. For

this study, five factors of technical skills, industry knowledge, creativity, cooperation and

communication, benchmarking reflecting software developer's capabilities were adopted as

independent variables. In addition, two factors of entrepreneurial self- efficacy and entrepreneurial

motivation were adopted as mediating factors in the relationship between independent factors and

start-up intention. Data were collected from entrepreneurs and employees in software developing

companies in northern Vietnam and analyzed through structural equation modeling (SEM) to

examine the relationship. Results showed the significance of software developers’ capabilities for

the development of entrepreneurial intentions through the mediating factors. The results also

revealed that benchmarking does not necessarily lead to entrepreneurial intention due to the

important role of entrepreneurial self-efficacy.

Key words: software developer's capabilities; entrepreneurial intention; entrepreneurial

motivation; entrepreneurial self-efficacy; technical skills; industry knowledge; creativity;

cooperation and communication; benchmarking.

1

I. Introduction

Entrepreneurship is a process by which individuals pursue opportunities to run their own

business or to have creative ideas inside the organization where they work. It plays a vital role in

new business creation, expansion of existing business as well as social and economic development.

Entrepreneurial activities create job opportunities, increase competitiveness and boost economic

growth (Linan et al.2008). For example in 2010, there were 248,824 active enterprises in Vietnam.

Thousands of new firms were established and millions of entrepreneurs attempted to start their

own business venture to catch the new wave of economic growth. With this rocket development

of private business, entrepreneurship has contributed approximately 40% of GDP to the economy.

And one of the most central problems of entrepreneurship research is the definition of

entrepreneurial behavior and Delmar (1996) said this is because it is inter-related to so many social

science fields (economics, history, psychology, sociology, geography) and with each coming with

a definition that suits it. The word “ENTREPRENEUR” has its origin during the 17th and 18th

century in the French economics (Dees, 1998). And Watson had scientifically explained

entrepreneurship by evaluating the nature of economics and commerce and posited a question “if

entrepreneurs are born or made?” He expressed his opinion that an enterprise is an economic

building block that enables an individual to undertake an economic activity. Thus, an entrepreneur

can be described as that individual that manages, takes and seeks opportunity and assumes risk in

the enterprise (Watson). Having mentioned that entrepreneurial opportunities are said to be

enormous and individuals just need to recognize them only, if they are willing to exploit them.

Obviously, entrepreneurship research has gotten to a level where the intention of individuals or as

a team should become an important thing and in addition, the study of entrepreneurial intention is

important to entrepreneurship and firm creation.