A Categorical Data Analysis on Relationships Between Culture, Creativity and Business Stage: The Case of Vietnam

25 December 2013 | For decades, thanks to studies by scholars in many research disciplines, culture has become an accepted factor that relates to the organisational process of setting values, building goals and guiding behaviours of employers and employees. Researchers have also examined other factors, such as business stage of development (e.g., start-up or entrepreneurial versus established mature firms), which plays a role in organisational success, in particular, in contribution to wealth creation in society but also by investing in new methods, new products help shape part of the changing cultures, and reinforce and realise true values of creativity.

Could these two factors, then, when joined by a third – creativity – may make organisations even more likely to succeed? In recent years, creativity has come under increasing scrutiny as a resource, renewable and ‘unrestrictable’, in that it resides in no specific person, place or organisation. Rather than complementing only the concept of ‘optimising currently available resources’ to obtain the best output/value possible for owners and stakeholders of the business firm or sector, creativity may rather yield the capability of making substantial changes either in the technology that firms use to manufacture better consumer goods, or of inventing new business logics and models that help to create new service markets, or of generating new methods that could turn waste of time and/or energy into new kind of value. In today’s global market, then, creativity may become key to building cutting edge competitive advantage and building corporate financial value.

In this paper, we explore insights from these three management issues – culture, growth stage and creativity – to  examine relationships among them and to present a tentative assessment of what those links might be and how they play out. We first review selected relevant literature related to the three key factors, namely relevant creativity dimensions, cultural values and stages of business development. Following the review, we explore how to examine the factors, in particular a method and exploratory data to carry this out. We then discuss the findings from this initial examination and possible implications and future research directions.

We use Vietnam as the research context for several reasons. First, it is a prime example of a fast changing emerging economy, with GDP growth averaging 7.22% in the last decade. Second, despite of the dominance of state-own enterprises, small and medium scale enterprises (SMEs) are widely considered the driving force of Vietnam’s economic growth (Vuong and Tran, 2009), especially since the financial turbulence that started in 2008. The expectation is that the SMEs’ capacity of creating new services and products – and of course, new jobs – could help the country get out of economy stagnation and is more likely than from the state owned enterprises. Finally, the concepts relating to creativity have not received as much attention yet in Vietnam, so using it as an example may yield some new insights not seen in more developed settings.

Our data analysis suggests some insights from the study of interactions between three categorical variables – in nature – as well as some thinking about further study of related management issues. From the above transformation of principles of creativity and culture theories into specific data, the use of contingency tables of joint frequencies enabled us to quantify qualitative assessment as count data, which are possible for an empirical investigation.

From the 3 × 3 × K consideration, we conclude that organisational growth stage matters (i.e., entrepreneurs and well established phases of business development). In the former, statistical independence is not rejected leading us to explain the relationship between the choice of creativity source and that of cultural values as independent, however with the latter, two-way association is the case. In other words, for an entrepreneur, cultural values do not help define type of creativity. Given such independence, corporate managers may be able to determine the quality of entrepreneurial elements and ability of being creative of a team from measures of a sample, not from the entire staff. In light of this, the corporations could explore what institutional and individual elements should be improved in order to facilitate creativity.

However, when we reorganise the dataset following the 2 × 2 × K structure, collapsing ‘relationship’ into one of the available resources that a business would use, the two-way association is not confirmed. Although in terms of statistical techniques, the simpler structure is preferable, and in most cases is more useful for our understanding, it is not always the best way explain what matters. This reflects the logic of a reality that researchers in both disciplines of creativity and culture research constantly split up different values in some way when pursuing research. One of such example is Hofstedehas expanded his dimensions of cultural values from 4 in his 1980 work to 5 in 1991 and to 6 in 2010 (http://geert-hofstede.com/national-culture.html). Still we expect that simpler structures may help since p-value reported in Table 7 vary quite large, and with other sets of data we may reach different conclusions.

The attempt to fit dataset to different log-linear models also allows useful insight. Given a fairly modest dataset (size = 115), it is good enough to decisively select an equation (4) to be the best fitted one. For this model – actually the ‘simpler’ one (more parsimonious) – fits the data as well as the homogeneous association equation (1). This result rejects the overall statistical independence among three dimensions of our consideration, namely sources of creativity, set of cultural values and phases of business development. In addition, we do capture at least one two-way association term (E × 3D) – whose coefficient is verified by a Wald statistic at 1% significance level – that helps explain well the distribution of our three-way contingency table. Now that we know at least in the entrepreneurship phase the creative disciplines would help explain the distribution of our data sample, the fact that shows the importance of the 3D aspect of creativity as described in Napier and Nilsson (2008). In fact, the homogeneous association estimation also offers the same conclusion as in Table A2.

We also learn from the above results that the most significant category among all creativity methods employed in Vietnamese enterprises has been the observation of ‘creative disciplines’ in the ‘entrepreneurial phase’. In general, those creative disciplines have played an important role in explaining the structure of data sample, for businesses in both stages of development. In other words, when Vietnamese enterprises pursue creativity – i.e., a new product or new solution – they should employ the 3D creativitymodel. Last, the template of our model and analysis may also suggest that these structures could be used as an empirical strategy for comparing different datasets specific to different localities or times, such as in other East Asian emerging market economies, such as China, Indonesia, India, or South Korea.

* Vuong, Q.H., Napier, N.K. and Tran, T.D. (2013) ‘A categorical data analysis on relationships between culture, creativity and business stage: the case of Vietnam’, Int. J. Transitions and Innovation Systems, Vol. 3, No. 1, pp.4–24.

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