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Paper - Digital Transform HD
Paper - Digital Transform HD
Abstract: The main objective of this study is to analyze the behavioral intentions of
agricultural cooperatives in applying digital transformation to their production activities. A
survey questionnaire received 225 responses from managerial staff, directors, and deputy
directors of agricultural cooperatives. Partial least squares structural equation modeling
(PLS-SEM) was used to explore the important factors in the intention to adopt digital
transformation in agricultural cooperatives in Hai Duong province using Smart PLS 3.0
software. Six significant factors related to the theme deployed in the proposed model include:
technical infrastructure, policy support, competitiveness capacity, financial capacity,
technology literacy, and social influence. The results indicate that the "policy support" factor
was excluded from the model, while the remaining factors all have an impact on the
dependent variable; notably, "financial capacity" and "technology literacy" have a negative
impact on the intention to adopt digital transformation in agricultural cooperatives in Hai
Duong province.
1. Introduction
The agricultural sector plays a crucial role in ensuring food supply and achieving food
security (Pawlak & Kołodziejczak, 2020). Enhancing food supply through increasing
agricultural productivity and expanding agricultural land use appears to be a feasible method
to alleviate hunger (Chappel & LaValle, 2011; Pawlak & Kołodziejczak, 2020). Additionally,
agriculture serves as a significant source of income for a considerable portion of the
population and countries worldwide. The Fourth Industrial Revolution is profoundly
transforming the socio-economic landscape, including agriculture (Do Kim Chung, 2017).
Klaus Schwab, Executive Chairman of the World Economic Forum, argues that the impact of
the digital revolution on agriculture has significant potential to reduce poverty in developing
areas.
In Vietnam, the practical application of information technology in agricultural
production, market research, and product marketing remains limited for both farmers and
rural enterprises. The digital transformation in agriculture and rural areas requires significant
contributions and efforts from the government, businesses, as well as farmers themselves. At
the 2022 Cooperative Economic Forum with the theme "Digital Transformation - Driving
force for cooperative economic development in the new era associated with the
implementation of Resolution No. 20-NQ/TW dated June 16, 2022", Prime Minister Pham
Minh Chinh emphasized the spirit of innovation, creativity, and breakthrough in the collective
economic model (with the backbone being cooperative economic organizations) as an
important economic component. Also at this forum, Professor Ha Ton Vinh suggested
prioritizing the development of a National Strategy on Digital Agriculture Economy,
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particularly emphasizing the need to strengthen focus and support for agriculture, rural areas,
and farmers to become one of the main pillars in the economy, production, and export.
Hai Duong province is located in the heart of the Red River Delta and is a key
economic area in northern Vietnam. The favorable weather conditions and soil fertility of this
province are conducive to the development of agricultural production. Agricultural production
in Hai Duong is evolving towards commodity-oriented production. According to a report
from the Cooperative Alliance of Hai Duong province, by 2024, the province had 367
agricultural cooperatives, accounting for 66.97% of the total number of cooperatives, with
nearly 30% of them operating in agricultural production and marketing chains. However, only
a few cooperatives have successfully applied digital transformation in agricultural production
and achieved the expected results. It can be seen that digital transformation in agriculture is an
inevitable trend for agricultural cooperatives in particular and all forms of agricultural
ownership in Vietnam in general.
In recent years, digital transformation has become a subject of research receiving
significant attention from scientists worldwide (Bharadwaj et al., 2013; Rodríguez-Abitia &
Bribiesca-Correa, 2021). However, most studies have focused on manufacturing enterprises
and have not yet concentrated on other forms of economic ownership such as cooperatives
and household farming.
In Vietnam, there is growing interest in studying the process of digital transformation in
agriculture in the Mekong Delta region (Trinh Phuoc Nguyen, 2023). However, in other areas,
there have been fewer studies focusing on the issue of digital transformation in agriculture,
especially concerning cooperative groups. The topic "The intention to digitally transform
agricultural cooperatives in Hai Duong province, Vietnam" was conducted to assess the
current situation of digital transformation in agriculture and propose solutions to enhance the
quality of digital transformation for agricultural cooperatives in Hai Duong province
specifically, and the Red River Delta region in general.
1.1. Research aim and objectives
The objective of this research is to identify and evaluate the factors influencing the
intention to digitize agricultural cooperatives in Hai Duong, Vietnam; thereby proposing
solutions for local government agencies to enhance the quality of digital transformation in
cooperatives at the grassroots level.
The specific tasks of the research include systematizing theoretical and practical
foundations related to the issue of digital transformation of agricultural cooperatives;
constructing a model of factors influencing the intention to digitize agricultural cooperatives
in Hai Duong province; analyzing the current situation and validating the research model to
assess the impact of factors on the intention to adopt digital transformation in agricultural
cooperatives; proposing solutions to increase the proportion of agricultural cooperatives
applying digital transformation in Hai Duong province.
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To ensure validity, the study collects information from secondary data in reports assessing
digital transformation and the economic situation of cooperatives provided by the Cooperative
Alliance and the Department of Agriculture & Rural Development; primary data through
questionnaire responses from 225 cooperative managers, directors/deputy directors of
agricultural cooperatives.
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whether the performance of that behavior is constrained. Therefore, TPB predicts behavioral
intention through three main factors: attitude toward the behavior, subjective norms, and
perceived behavioral control, each of which influences behavior depending on its importance
to the individual.
2.2.2 Unified Theory of Acceptance and Use of Technology - UTAUT
The Unified Theory of Acceptance and Use of Technology (UTAUT) model was
developed by Viswanath Venkatesh (2003) and colleagues, based on eight component
models/theories, including the Innovation Diffusion Theory (IDT) and the Social Cognitive
Theory (SCT). The UTAUT model consists of four main factors: Performance Expectancy;
Effort Expectancy; Social Influence; and Facilitating Conditions.
The UTAUT model contributes to assessing the likelihood of success in implementing
new technology and identifying the factors influencing this acceptance. Thus, stakeholders
can design supportive measures, such as training or marketing, to encourage users to embrace
the change.
2.3 Factors affecting digital transformation intentions
The authors Francisco J. Santos and Carmen Guzmán (2023) utilized regression
analysis method based on survey data from agricultural food cooperatives in Andalusia,
Spain, and identified several factors influencing the intention to digitally transform
agricultural food cooperatives such as: Technical infrastructure (used technologies:
computers, phones,...); Organizational culture and employees (innovation, training, human
resources policies, technology); Products and services (e-commerce and digitalization of
production processes); Processes (traceability of information, big data, and warehouse
management); Customers (level of technology usage, online access, online marketing).
Hermanus Jacobus Smidt and colleagues (2021) highlighted the role of the state in
governance and policy support, digital technology application solutions, and creating
conditions to support small-scale farmers in the agricultural value chain (AVC) in South
Africa, as factors influencing the adoption of digital technology by small-scale farmers.
Gabriel Wee Wei E (2022) based on the Unified Theory of Acceptance and Use of
Technology (UTAUT) model by Viswanath Venkatesh (2003) identified factors influencing
the digital development potential in agriculture including: Performance; Effort Expectancy;
Social Influence; Facilitating Conditions.
Trinh Phuoc Nguyen (2023), based on Ajzen's Theory of Planned Behavior (1991),
utilized a research model of intention to adopt technology, constructed a theoretical model,
and employed multiple linear regression analysis method to analyze survey data from
cooperatives in An Giang province to identify factors influencing the intention to digitalize
cooperatives. The results indicated that factors such as the strategic goals of cooperatives,
financial resources, technological infrastructure, and employees' level of technology usage
had an impact on the intention to digitalize cooperatives in An Giang.
From the theoretical frameworks combined with previous studies, the authors propose
6 factors influencing the intention to digitalize agricultural cooperatives, including: financial
capacity, Technology infrastructure, technology literacy, policy support, social influence, and
competitive capability.
H1: Technology infrastructure has a positive impact on the intention to digitalize
agricultural cooperatives.
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H2: Policy support has a positive impact on the intention to digitalize agricultural
cooperatives.
H3: Competitive capability has a positive impact on the intention to digitalize
agricultural cooperatives.
H4: Financial capacity has a positive impact on the intention to digitalize agricultural
cooperatives.
H5: Technology literacy has a positive impact on the intention to digitalize
agricultural cooperatives.
H6: Social influence has a positive impact on the intention to digitalize agricultural
cooperatives.
3. Research methodes
To clarify the research objectives and assess the impacts of factors influencing the
intention to digitize agricultural cooperatives (ACs) in Hai Duong province, the authors
employed several statistical analysis methods including Descriptive Statistics and Partial
Least Squares Structural Equation Modeling (PLS SEM) (Ha Nam Khanh Giao & Bui Nhat
Vuong, 2019).
4. Research results
4.1 Descriptive statistics
Table 1: Descriptive statistics
Freq. (%)
Male 195 86.7
Gender
Female 30 13.3
Agricultural cooperative
officer
45 20.0
Director/deputy director of
agricultural cooperatives
168 74.7
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25 - 35 9 4.0
Age 35 - 45 63 28.0
Over 45 153 68.0
Untrained 39 17.3
Elementary occupations 27 12.0
For the purposes of this study, the author group conducted a survey of 225 responses
from members of the board of directors and various committees of cooperatives in Hai Duong
province, with 195 male (86.7%) and 30 female (13.3%) participants. The positions of survey
respondents were primarily Cooperative Directors/Vice Directors, accounting for 168
individuals (74.7%), followed by 45 cooperative committee members (20%), and 12
administrative officials (provincial, district, and village levels) making up 5.3%. The age
group of respondents was predominantly over 45 years, with 153 individuals (68%), followed
by those aged 35-45 years with 63 individuals (28%), and those aged 25-35 years comprising
4% with 9 individuals. The educational qualifications of the respondents included
University/Postgraduate (44%), no formal training (17.3%), vocational middle level (14.7%),
and equal shares of 12% for both college and primary vocational training. A particular issue
of interest to the author group was the degree of digital transformation within the agricultural
cooperatives. According to the data collected, 99 out of 225 cooperatives had participated in
digital transformation within their production activities, which represents 44%. Additionally,
28% of cooperatives used digital tools only within their accounting departments, while 14.7%
had not engaged in digital transformation, and the remaining 13.3% had not determined their
digital transformation status.
4.2 Evaluation of reliability, validity, distinguishing value of the structure in the model
According to Hair et al. (2016), reliability and validity testing of a structure includes
steps for assessing internal consistency, convergent validity, and discriminant validity. To
evaluate reliability, outer loadings for observed variables, Cronbach's Alpha, and composite
reliability (CR) are used. Nguyen & Vu (2020) state that outer loadings should be at least 0.7,
and both Cronbach’s Alpha and composite reliability (CR) should also exceed 0.7, following
Hulland (1999). Convergent validity is assessed by the Average Variance Extracted (AVE).
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Fornell & Larcker (1981) suggest that an AVE value greater than or equal to 0.5 confirms
convergent validity. The results in Table 2 show that all variables on the scales meet internal
consistency (with all observed variables having outer loadings greater than 0.7, and both
Cronbach’s Alpha and CR exceeding 0.7). Moreover, the Average Variance Extracted (AVE)
of the scales all exceed 0.5, thus the scales in the study achieve convergent validity (Hock &
Ringle, 2010).
Table 2: Results of reliability and convergent validity of the scales
Average
Outer Cronbach's Composite
Observed Variance
The scale loading Alpha reliability
variables Extracted
factor coefficient (CR)
(AVE)
TL1 0.895
TL4 0.939
PS1 0.750
PS4 0.789
TI1 0.942
Technology
TI2 0.923
Infrastructure (TI) 0.900 0.937 0.833
TI3 0.872
CA1 0.930
Competitive
CA2 0.832
Capability (CA) 0.891 0.931 0.819
CA3 0.949
FC1 0.952
Financial Capacity
FC2 0.926
(FC) 0.942 0.962 0.895
FC3 0.960
SI1 0.902
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DI2 0.971
Transformation
DI3 0.892
Intention (DI) 0.952 0.965 0.874
DI4 0.933
Source: Results of survey data processing using Smart PLS
In this study, the research team used the HTMT index to evaluate the discrimination
between scales. If the Discriminant Validity value between influencing factors (HTMT index)
is below 0.9, the requirement will be met (Henseler & al., 2015). The results in Table 3 show
that the values of the HTMT index are all less than 0.9, so the scales in the model all achieve
discriminant value.
Table 5 presents the PLS - SEM model evaluation values according to Hair et al.'s (2016)
proposal.
Table 5: Results of VIF, R values2 ,f2 ,Q2
VIF R2 f2 Q2
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Social Influence (SI) 2.643 1.229
Digital Transformation Intention
0.733 0.633
(DI)
Source: Results of survey data processing using Smart PLS
The results in Table 5 show that the variance inflation factor (VIF) of the independent
variables is less than 5 (Hair & al., 2011), so it can be concluded that the observed variables
do not occur multicollinearity phenomenon. Results of PLS Algorithm analysis for R2 (R-
square value) is used to measure the model fit of the data or the model's explanatory ability.
According to Table 4, the determination coefficient R 2 has a value of 0.733, showing that the
independent variables in the model explain 73.3% of the intention to digitally transform in
agricultural cooperatives in Hai Duong province while the remaining 26.7% comes from
systematic errors and other factors are outside the model value f 2. If f2 < 0.02, the variable has
no impact, so according to Table 5, the variables PS (0.009), FC (0.019), CA (0.018), have no
impact on the dependent variable. At the same time, the variables TL (0.111), TI (0.059) have
the value f2 < 0.15 shows a small effect and the SI variable (1.229) has f 2 > 0.35 has a large
impact on the dependent variable. According to Table 5, the model's prediction coefficient has
a value of 0.633 > 0.5, showing that the level of forecast accuracy is high (Tenehaus and
colleagues, 2005)
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H6 SI -> DI 0.932 19.109 0.000* Accept
Note: *: significance level 5%; **: significance level 10%
Source: Results of survey data processing using Smart PLS
The analysis results in Table 7 indicate that TI, CA, TL, and SI all influence the
intention to digitalize (p1,3,5,6 < 0.05) at a 5% significance level, where TI, CA, and SI have a
positive impact (β1,3,6 > 0), and TL has a negative impact on the digital transformation
intention (β5 < 0). Additionally, FC also negatively affects the digital transformation intention
(β4 < 0 and p4 < 0.1) at a 10% significance level. Therefore, hypotheses H 1, H3, H4, H5, and H6
are all accepted. However, PS does not influence the digital transformation intention as p2 >
0.1, indicating insufficient evidence to conclude a linear relationship between PS and the
intention to digitalize in agricultural cooperatives. Thus, hypothesis H2 is rejected.
The results in Table 7 also show that Social Influence has the strongest impact on the
intention to digitalize (β = 0.932), followed by Technology Literacy (|β| = 0.321), then
Technology Infrastructure (β = 0.238), Financial Capacity (|β|=0.117), and finally,
Competitive Capability (β = 0.108)
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The interpretation for these results based on practical survey findings is as follows:
policy support is not deemed necessary in the model because digital transformation is a new
issue without appropriate supportive policies, making it inaccessible for cooperatives to
ascertain the impact of supportive policies on their digital transformation intentions.
"Technology literacy" is the second most influential factor in the model and has a negative
impact on the digital transformation intentions of agricultural cooperatives. Through practical
surveys, the authors can explain this, the majority of participants believe that the technology
literacy of cooperatives is limited, as they are not proficient in using technologies and do not
know how to solve technology-related issues. Therefore, the higher the number of
cooperatives with limited technology literacy, the lower the digital transformation intentions
of agricultural cooperatives in Hai Duong province. A similar explanation can also be
provided for the inverse effect of "Financial capability" in the model. In Hai Duong, most
cooperatives face financial difficulties; they lack the capacity to invest in modern machinery
for agricultural production and cannot afford high-quality personnel to support digital
transformation. Therefore, it can be observed that the fewer agricultural cooperatives with
financial capability, the less their digital transformation intentions. The remaining factors
positively influence the dependent variable, indicating the level of impact on the digital
transformation intentions and the desired level of digital transformation of agricultural
cooperatives in Hai Duong province.
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while attracting investment in high-tech agriculture. Mobilizing funds from various sources to
build and develop efficient production and business infrastructure, and implementing
synchronized investment policies in agriculture. Lastly, organizing technology fairs and
forums, introducing new scientific and technological advances in agriculture, providing
documentation and technical guidance for the transfer and application of new technologies.
5.3 Limitations and subsequent research directions of the topic
It cannot be denied that the research conducted by the team still has many limitations
and several aspects have not been thoroughly examined. The study has not fully explored all
the similarities between Hai Duong and some areas with similar production scales and
agricultural systems. The sample size needs to be increased to improve the accuracy of the
model. However, the study still predicts with high confidence some key factors influencing
the intention to digitalize agricultural cooperatives.
Therefore, to overcome these limitations, further research needs to increase the survey
sample size and diversify the surveyed subjects. Additionally, additional moderators should
be included in the model to clearly see the impact of the independent variables in the model.
The proposed solutions need to be specific, assessing the obstacles encountered during
implementation to increase the proportion of agricultural cooperatives applying digital
transformation in Hai Duong province.
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