An Administrative Support System for Digital Transformation of Small and Medium-Sized Enterprises in Vietnam

The DX process is very complex and has an impact on all business activities. As a result, the formulation and implementation of a DX strategy have become a key concern for many businesses prior to DX, and a systematic approach is crucial to success (Hess, et al., 2016; Schulz and Tungseth, 2018). Rauser (2016) states that the DX strategy refers to an enterprise’s strategy applied to all DX initiatives, including the entire process: gathering all the necessary information, planning the strategy, recognizing risks and opportunities, and maintaining the DX strategy (Rauser, 2016).

According to Matt, et al. (2015), the DX strategy approach has two perspectives: 1) Process: how to develop, implement, and evaluate the DX strategy considering new aspects that DX brings to the organization; and 2) Procedure: the process of defining the strategy according to the aspects and components of the DX strategy (Schulz and Tungseth, 2018). In addition, several recent studies appear to add methods of using maturity models to build DX strategies (Pierenkemper and Gausemeier, 2021). Maturity model is a model that helps an individual or organization reach maturity (i.e., capabilities) in terms of people/cultures, processes/structures, and/or objects/companies. Technology follows a step-by-step continuous improvement process (Mittal, et al., 2018). Therefore, maturity models are an appropriate tool to guide enterprises in the process of assessing the maturity of enterprises in DX (Szedlak, et al., 2020).

Besides, researchers have also recently conducted research on different aspects and methods to support businesses in DX. According to the results of a recent literature review on DX and Industry 4.0 by many authors (Mittal, et al., 2018; Vial, 2019; Schmitt, et al., 2020), recent studies also use the following models/methods:

Not staying out of the general DX trend, the researches on DX in SMEs are very diverse with many different methods/models: 1) DX strategy: a) process (Li, et al., 2018; Hönigsberg and Dinter, 2019; Anim-Yeboah, et al., 2020; Pierenkemper and Gausemeier, 2021), b) procedures (Barann, et al., 2019; Virkkala, et al., 2020), and c) maturity model (Beliveau, et al., 2018); 2) DX framework (Becker, et al., 2018; Feichtinger, 2018; Marc Gruber, 2018; Trenkle, 2019; North, et al., 2020); 3) DX roadmap (Cotrino, et al., 2020); and 4) readiness model (Ministry of Industry and Trade, 2018; Cameron, A., Pham, T.H., Aterton, J., Nguyen, D.H., Nguyen, T.P., Tran, S.T., Hajkowicz, 2019; Dutta, et al., 2020; Pirola, et al., 2020). The paper will conduct an analysis of these models/methods to identify research gaps as well as problems that current methods have not yet solved in a comprehensive manner for the expectations of SMEs.

The author has analyzed the above studies and has identified the results and limitations of these DX methods/models as shown in Table 1.

According to the search results about digital tools that manage the DX process through the keywords: “Digital transformation management” + System/Tool/Approach, there are currently quite a few research or commercial solutions on digital tools that manage the DX activities. Therefore, the paper will focus on three phases that have supporting numbers: 1) assess the current state of DX of enterprises; 2) develop a DX strategy; and 3) manage the DX projects.

Regarding the assessment of the current state of enterprises’ DX, the research will propose a model of “Readiness” or “Maturity model” of DX and build a website to collect opinions of experts. However, these websites only stop collecting opinions, aggregating results, and comparing industry averages. One of the solutions to mention is as follows:

Regarding digital tools to build a DX strategy, there are currently not many studies or solutions. However, there are some studies that have used the Balanced Scorecard (BSC) method to build a DX strategy such as those of Fabac (2022), Maydanova, et al. (2019), and Yamamoto (2020). BSC has more than 25 years of history, so solutions or studies on BSC digital tools are quite popular and quite numerous (more than 300 studies with the keyword “balanced scorecard software”). In Vietnam, there are many enterprises providing software solutions for BSC. One of the typical suppliers is KPI software of global application technology development investment joint stock company (IHCM); Strategic Management Software (KPIBSC - BSC) of KPIBSC.

About digital project management tools are quite popular and widely used in many different fields. Some popular project management tools are MS Project, Trello, Jira, Basecamp, and Asana. In Vietnam, the solutions for digital project management tools are also very diverse, and most of the solutions are. Enterprises providing DX solutions all have their own project management software such as FastWork Project of Fastwork, MISA AMIS Work of MISA, and Base Work+ of FPT.

Based on a review of existing studies on DX methods/models for SME worldwide and information systems that support the management of the DX processes in enterprises, this study identifies the following research issues that need to be addressed:

The system is developed using the waterfall model SDLC (Kramer, 2018), a sequential approach to software development that includes six main steps: From the business process, architectural model, and information system development process, the article will develop and test the system according to a 6-step process as follows:

The author conducted a Delphi survey with over 300 DX experts in SMEs in Vietnam using the Foresight approach to assess the features, challenges, and business vision of DX. The study also forecasts the future demand for DX in SMEs and the most important activities for implementing it. To calculate the sample size and determine the reliability level, the author used Yamane’s (1967) sampling technique as a reference. The findings of the analysis were presented in detail in the study “Building a Digital Transformation Strategy for SMEs in Vietnam – Approaching Foresight” (Tuan, et al., 2023).

Most businesses need government assistance and tools during the DX process. In terms of support tools, most businesses have not used a comprehensive support system and desire one with the following capabilities.

Surveyed businesses want to have an information system capable of helping businesses develop a specific and appropriate DX roadmap (accounting for 88%), allowing businesses to share experiences through examples and good practice cases, as well as the ability to collaborate to form a DX community in SMEs (78%). SMEs are often limited in finance, human resources, and technology, so they will often choose some key activities of enterprises to perform DX first, so they want the system capable of allowing them to choose DX pillars (customers, products, processes, etc.) that are suitable for step-by-step implementation (76%). Seeing possible DX scenarios in the future is also desirable when businesses build a DX strategy (73%). In addition, SMEs also want some other functions (over 65%) such as: 1) being able to manage and track the progress of DX projects (73%); 2) integration with external support such as innovation labs, research institutes, and consulting organizations (73%); 3) analyze and evaluate technology trends affecting enterprises (72%); 4) simple tools, easy to use, and accessible anywhere and anytime (71%); 5) provide an overall and detailed view of all DX activities of enterprises from a strategic level to ongoing DX projects (67%); 6) assess the current digitization status, readiness, and expectation for DX from enterprises (65%); and 7) provide DX orientation in each specific field (43%).

From the analysis results on research gaps when implementing the above research overview and system requirements from experts with experience in DX activities at SMEs in Vietnam, the article has proposed a DX management system to help SMEs manage DX activities easily, effectively, and comprehensively. The DX management system will support enterprises to carry out DX through four main stages, which are represented by four subsystems of the system, as shown in Figure 1:

Figure 1.

Business process of the DX support system for SMEs.

(Source: Authors’ own research)

According to the hardware requirements of the Odoo server, with a 2-core CPU and 2 GB of RAM, it is possible to meet the requirements of 10 users using it at the same time. Because the system is in beta and the number of users simultaneously using the system is not high, the author has been hired a server of Azdigi company with the following configuration:

In addition, a domain https://quantrichuyendoiso.top/en is also registered for use. Since there is only one server, everything will be installed on the same server. For security and future scalability, the server will use Nginx (https://www.nginx.com/) as a front-end proxy to receive requests from users. With Nginx, it will be easier to scale to meet the requirements of 1000 concurrent users later with load balancing for multiple Odoo servers at the same time. Regarding SSL, the system will use Let’s Encrypt for free to save costs. However, Let’s Encrypt is only valid for 30 days, so it is also necessary to set up automatic re-registration after 30 days.

The system installation will proceed according to the following model in Figure 3. The model will include five elements: Firewall, Nginx, SSL Let’s Encrypt, Odoo System, and PostgreSQL (enterprise and shared data).

Figure 3.

Deployment model of test system.

(Source: https://quantrichuyendoiso.top/en)

The DX management support system was first deployed at the economic informatics center around July 2022. In the early stages of the system, there were many errors and some problems arising in the process of testing the system. From the beginning of September 2022, the new system became stable and officially deployed to the Academy of Technology and Design of University of Economics Ho Chi Minh City at https://quantrichuyendoiso.top/en. After that, the system continued to be tested with more than 10 Vietnamese SMEs in many different fields and types of enterprises (micro, small, and medium) as shown in Figure 4.

Figure 4.

Proposed overall architecture.

(Source: Authors’ own research)

SMEs were selected to test the system for the following main reasons: 1) Convenience: due to the fact that the information about DX provided by enterprises is quite detailed and contains a lot of information related to business secrets or future plans of enterprises, so businesses will be afraid to share, so it is necessary to choose businesses that have good connections and are willing to share information when conducting experiments;

2) Enterprise diversity: because SMEs are very diverse and have many different needs for DX, the system has been tested on many different types of businesses from micro to medium, many different fields from manufacturing, construction, to trade and services. From the test results, it has been proved that the modularization of the DX pillars of the model is suitable for SMEs in Vietnam, micro and small enterprises have limited resources, so they only need to choose the pillars that they are interested in. In addition, some businesses operating in special fields can create new DX pillars such as enterprises operating in the education sector that have created new pillars of Admissions and Training or agricultural enterprises that have established new pillars of DX as Smart Farm pillar.

After completing the experiment in enterprises, the author conducted interviews with some personnel who are using the system to assess the suitability, problems, and improvements of the system. The evaluation content will include 11 criteria, and these are also the 11 expectations of SMEs about a tool or system to support DX mentioned above. For each criterion, the testing enterprises will fill in two information: 1) the level of agreement/satisfaction about the system’s ability to meet the requirements (from 1 to 5 points) and 2) enterprise’s assessment of the function to use: advantages, disadvantages, errors encountered, suggestions…. Figure 5 is the statistics on the level of agree-ment/satisfaction with the system of testing enterprises.

Figure 5.

Level of agreement/satisfaction of test enterprises.

(Source: Authors’ own research)

Table 3 is the detailed evaluation of the test enterprise after using the system.

Currently, the system is still maintained at https://quantrichuyendoiso.top/en so that other businesses can access and conduct testing. Enterprise can experiment with the accounts below or contact the author to get a separate account for enterprise:

This research on DX for SMEs in Vietnam has important implications for their development in the context of the 4.0 industrial revolution. It can help SMEs keep up with new technology trends, improve competitiveness, and achieve sustainable growth.

Strategically, the research provides guidance for Vietnamese SMEs in implementing DX. The comprehensive DX management model proposed in the study can help these businesses develop DX plans and strategies tailored to their specific needs.

In terms of implementation, the research has developed an information system to support SMEs in the DX process. This system can help businesses automate processes, collect and analyze data, and make informed decisions.

The research has also helped to raise awareness of DX among SME managers. The system provides information and knowledge and creates awareness for SMEs as they learn to use the system. It also shares information about the DX process between SMEs, creating a knowledge base for them.

Overall, the research is expected to have a positive impact on the productivity, efficiency, and competitiveness of Vietnamese SMEs. Digital transformation can help these businesses save costs, improve labor productivity, and create new products and services to meet market needs.