The impact of prospecting strategy on small business performance in Vietnam: The role of broad-scope management accounting system

Ngo Quang-Huy

doi:10.5937/straman2102054q

Abstract

The purpose of this study is to uncover the role of broad-scope management accounting system (MAS) on the link between prospecting strategy and the performance of small businesses. In particular, this paper hypothesizes that a high degree of prospecting strategy is positively associated with a high degree of broadscope MAS, and a high degree of broad-scope MAS is correlated with a high degree of performance of small businesses. Also, it is hypothesizes that prospecting strategy increases the performance of small businesses. The last hypothesis proposes that broad-scope MAS mediates the link between prospecting strategy and the performance of small businesses. Data was collected from 131 small businesses located in Cantho city to assess the proposed hypothesis. A PLS-SEM was analyzed with the collected data. The results reveal that all hypotheses are supported by the data except the hypothesis describing the relationship between prospecting strategy and the performance of small businesses. It implies that broad-scope MAS fully mediates the link between these two variables.

Highlights

Since the introduction of "Doi Moi" (Renovation), the Vietnamese economy has transformed dramatically
This study aims to uncover the role of broadscope management accounting system (MAS) on the link between prospecting strategy and performance of small businesses in Vietnam
This paper proposes that prospecting strategy is positively associated with broad-scope MAS and the performance of small businesses in Vietnam

Summary

Introduction

Since the introduction of "Doi Moi" (Renovation), the Vietnamese economy has transformed dramatically This policy's central theme is to transform the economy from a central planning economy to a socialist-oriented market economy (Irvin, 1995). Such an approach has a substantial impact on the Vietnamese social-economy. Most of Vietnamese research focuses on large businesses, a lack of attention has been paid to small businesses. As such, this limits our knowledge of how strategic choice influences the performance of small businesses. It is expected that MAS may impact the relationship between strategy and performance

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Discussion

Conclusion