The correlations between big data analytics and financial performance: empirical investigation in the vietnamese banking sector, 2021

1

THE STATE BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING

BANKING UNIVERSITY OF HO CHI MINH CITY

CHU VIET HONG

THE CAPABILITIES OF BIG DATA ANALYTICS

INFLUENCE ON FINANCIAL PERFORMANCE:

EMPIRICAL INVESTIGATION IN BANKING

SECTOR AT HO CHI MINH CITY

THESIS PROPOSAL

BUSINESS ADMINISTRATON

CODE: 7340101

Advisor by DANG TRUONG THANH NHAN, MBA

HO CHI MINH, 2021

2

THE STATE BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING

THE CAPABILITIES OF BIG DATA ANALYTICS

INFLUENCE ON FINANCIAL PERFORMANCE:

EMPIRICAL INVESTIGATION IN BANKING

SECTOR AT HO CHI MINH CITY

THESIS PROPOSAL

BUSINESS ADMINISTRATON

CODE: 7340101

Advisor by DANG TRUONG THANH NHAN, MBA

BANKING UNIVERSITY OF HO CHI MINH CITY

HO CHI MINH, 2021

CHU VIET HONG

i

ABSTRACT

This study presents a big data analytics capability (BDAC) model based on the

resource-based approach and the literature on big data analytics (BDA), information

system (IS) success, and the commercial value of information technology (IT). The

study expands on the previous research by looking at the direct impacts of BDAC on

financial performance at banks (FPER), as well as the effects of technological

capacity, talent capability, management, and bank performance on the link between

big data analysis and FPER. We utilized an online survey to collect data from 250

Vietnamese IT managers and business and finance analysts with big data and business

analytic experience at banks in Ho Chi Minh City to evaluate our suggested research

methodology.

The findings confirm the value of the entanglement conceptualization of the

hierarchical BDA model, which has both direct and indirect impacts on FPER. As a

result, this study examines the relationship between Vietnamese banks' big data

analysis and their financial indicators to determine if a focus on big data analysis can

be applied to assist improve the banking sector's financial performance.

The research study was conducted in order to: (1) Identify BDA measures

influencing BDA capability in the Vietnamese banking sector; (2) evaluate the

relationship between BDA measures and BDA capability in the Vietnamese banking

industry; (3) examine the correlation between BDA capability and financial

performance. The study began with a reference to theories and results of previous

studies on experience in using and working with big data at banks in Ho Chi Minh

City recent years, the author proposed a theoretical model of factors’ BDA affecting

financial performance including 5 factors: BDA management capability (BDAMC),

BDA technology capability (BDATEC), BDA talent capability (BDATLC), BDA

capability (BDAC) and bank performance (BPER) with 20 variables of observation

and each factor with 4 variables.

The formal study was carried out utilizing quantitative research approaches such

as consumer survey techniques and comprehensive questionnaires. The sample size

ii

was 250 people. SPSS 20 statistical software was used to process the obtained data.

Cronbach's alpha reliability coefficient was used to assess the scale's preliminary

reliability, and the EFA exploratory factor analysis was used to test it. The suggested

research model was originally calibrated based on the analysis outcomes. The author

next used the features of the redesigned research model to the linear regression

analysis. Based on the findings of this investigation, the author's choice with 5

observed variables and the basic model of five component factors with 20 observation

variables remained unaltered.

iii

DECLARATION

This thesis is the author's own research work, the research results are honest, in

which there are no previously published contents or content made by others except

for the cited references full source in the thesis.

iv

ACKNOWLEDGEMENTS

During my thesis time, I got loads of backings and supportive gestures from

numerous people. This thesis would not have been accomplished without those

valuable input, support, counsel, and advice.

First and foremost, I would like to express my deepest acknowledge to my advisor

MBA. Dang Truong Thanh Nhan – lecturer at Banking University of Ho Chi Minh

City for her unbelievable and unreserved help, valuable advices and recommendation.

Thanks for her effort and wide knowledge to make my topic possible, her suggestions,

direction and advices are always highly appreciated and greatly contributing to the

success of this thesis.

I would also like to express my sincere appreciation to the professors and lecturers

for their guidance during my academic years at the University of Banking. The

knowledge and skills that I have learned, have assisted me in the completing of this

thesis.

Last but not least, honestly the most supported ones are my family. Words fail me

to express my thankfulness for my parents for their endless love. To all the above,

and so many more, I just simply want to say again “Thank you for all your

encouragement, support, and love”.

v

TABLE OF CONTENTS

ASTRACT...................................................................................................................i

DECLARATION..................................................................................................... iii

ACKNOWLEDGEMENTS.....................................................................................iv

LIST OF ABBREVIATIONS............................................................................... viii

LIST OF TABLES ...................................................................................................ix

LIST OF FIGURES ..................................................................................................x

LIST OF DIAGRAMS..............................................................................................x

CHAPTER 1 OVERVIEW OF THESIS ................................................................1

1.1. Research Background ......................................................................................1

1.2. Research objectives ..........................................................................................2

1.3. Research questions............................................................................................3

1.4. Research subject and scope ..............................................................................4

1.4.1. Research subject.........................................................................................4

1.4.2. Research scope ...........................................................................................4

1.4.3. Research respondents.................................................................................4

1.5. Significant of study...........................................................................................5

1.5.1. Practical significance..................................................................................5

1.5.2. Scientific significance ................................................................................5

1.6. Research Method ..............................................................................................5

1.6.1. Expected layout of the thesis......................................................................5

1.6.2. Proposed thesis structure ............................................................................6

1.7. Conclusion ........................................................................................................7

CHAPTER 2 LITERATURE REVIEW AND REVIEW RESEARCH MODEL

...................................................................................................................................8

2.1.The Big Data Analytics .....................................................................................8

2.2. Navigating BDAs in the Financial Sector ......................................................11

2.3. The theoretical background ............................................................................12

2.3.1. The Resources-based view theory (RBT) ................................................13

vi

2.3.2. Institutional theory ...................................................................................14

2.3.3. The management theory ...........................................................................15

2.3.4. The organizational culture........................................................................16

2.4. Theoretical Model and Hypotheses................................................................22

2.4.1. BDA Management Capability (BDAMC)................................................22

2.4.2. BDA Technology Capability (BDATEC)................................................23

2.4.3. BDA Talent Capability (BDATLC).........................................................24

2.4.4. Big Data Analytics Capability (BDAC) and Financial Performance (FPER)

............................................................................................................................26

2.4.5. Bank Performance (BPER) and Financial Performance (FPER).............27

2.4.5.1. Bank Performance (BPER)................................................................27

2.4.5.2. Financial Performance (FPER)..........................................................29

2.5. Conclusion ......................................................................................................31

CHAPTER 3 RESEARCH METHODOLOGY...................................................32

3.1. Research Process ............................................................................................32

3.1.1. Quantitative Research...............................................................................32

3.2. Adjust the Scale ..............................................................................................33

3.3. Data Processing Methods ...............................................................................38

3.3.1. Cronbach's Alpha Analysis ......................................................................38

3.3.2. EFA Analysis ...........................................................................................39

3.3.3. Regression and Anova Analysis...............................................................40

3.3. Conclusion ......................................................................................................41

CHAPTER 4 RESULT AND DISCUSSION........................................................43

4.1. Overview of the research samples..................................................................43

4.1.1. Descriptive statistics for variables............................................................43

4.1.2. Descriptive statistics for independent variables.......................................45

4.2. Cronbach’s Alpha Analysis............................................................................47

4.2.1. Evaluate Independent Variable Scale.......................................................47

4.2.2. Evaluate Dependent Variable Scale .........................................................49

vii

4.3 Exploratory Factor Analysis (EFA).................................................................49

4.3.1. EFA analysis for Independent Variable Scale..........................................49

4.3.2. EFA analysis for Dependent Variable Scale ............................................52

4.4. Linear Regression and ANOVA Analysis......................................................54

4.4.1. Linear Regression.....................................................................................54

4.4.2. ANOVA Analysis.....................................................................................54

4.5. Hypothesises testing .......................................................................................55

4.6. Determining the differences according to the characteristics of the research

object......................................................................................................................57

4.6.1. Difference in Type of Bank......................................................................57

4.6.2. Difference in Data usage frequency .........................................................58

4.7. Theoretical contributions................................................................................60

4.8. BDA practices of different types of banks .....................................................61

4.9. Challenges related to BDA in the banking sector in Vietnam........................64

4.10. Reflection on findings based on proposed conceptual framework...............66

4.11. Conclusion ....................................................................................................67

CHAPTER 5 CONCLUSIONS AND RECOMMENDATION ..........................69

5.1. Conclusions.....................................................................................................69

5.2. Implications ....................................................................................................70

5.2.1. BDA capability.........................................................................................70

5.2.2. BDA talent capability...............................................................................71

5.2.3. Bank performance ....................................................................................71

5.2.4. BDA technology capability ......................................................................73

5.3. Limitations and Recommendation for Future Research .................................74

5.4. Final reflection................................................................................................75

REFERENCE ..........................................................................................................77

APPENDICES .........................................................................................................91

viii

LIST OF ABBREVIATIONS

BDA Big data analystics

BDAC Big data analytics capability

BDAMC BDA management capability

BDATEC BDA technology capability

BDATLC BDA talent capability

BPER Bank performance

FPER Financial performance

IS Information system

IT Information technology

RBT Resource-based view theory