The impact of leadership on workplace innovation in Thai and Vietnamese SMES

Abstract

It is accepted that SMEs play an important role in economic growth in many Asian countries. For example, Vietnamese SMEs represent 97% of the number of businesses of the country; employ 77 percent of the workforce and account for 80% of the retail market. Similarly, Thai SMEs have significantly contributed to the Thai economy and account for 99% of all business establishment, nearly 75% of total employment, and nearly 40% of total GDP. Yet the question of whether small firms are more or less advantageous in their ability to be more innovative is still unclear. In Asia, SMEs have possessed a number of strengths that could contribute to their capacity to innovate. The study compares the perceptions toward leadership, work value ethics and workplace innovation in Thai and Vietnamese SMEs. A survey was completed by 696 respondents drawn from Thai and Vietnamese SMEs. The survey was comprised of the Design Leadership Questionnaire (DLQ), the Workplace Innovation Scale (WVE) and the Work Values Ethic (WVE) instrument. The Cronbach’s alpha values for each instrument were α - 0.911 (Design Leadership), α - 0.913 (Workplace Innovation), and α -0.798 (Work Value Ethic). T-test results found that there was a statistically significant difference in the mean scores of Leadership behaviour and all of its dimensions. Also, the significant differences are found in the mean scores of Workplace Innovation and all of its dimensions between Thai and Vietnamese respondents. However, there was no difference in the perception toward Work Values Ethic between the respondents of these two countries. The findings provide empirical evidence to advance our understanding of the impact of work values on leadership behaviour and workplace innovation and assists in developing Government policy to further SME leadership behaviour for Thai and Vietnamese managers to lead their subordinates towards innovation practices.