The relationship between organizational learning and innovation capability in the Vietnamese banking sector

Abstract

This study investigates the influence of organizational learning on the innovation capability of commercial banks in Vietnam. Its aim is to identify the nature of the relationship between these constructs and empirically examine whether organizational learning practices impact banks' innovation capabilities. This research uses in-depth interviews with a large-scale survey administered to employees across various Vietnamese commercial banks employing a mixed-methods approach. Data collection primarily relied on questionnaires with 280 valid responses to explore the direct and indirect effects of organizational learning on innovation capability. Quantitative analysis and structural equation modeling (SEM) were conducted using Smart-PLS software to assess scale reliability, test hypotheses and analyze the collected data. The findings confirm a direct and positive relationship between organizational learning and bank innovation capability. Three factors such as commitment to learning, shared vision and open-mindedness were found to exert significant positive influences on the bank’s product and process innovation. However, intra-organizational knowledge sharing exhibited a significant and positive impact only on process innovation with an insignificant effect on product innovation. This finding concerning the limited influence of knowledge sharing on product innovation represents a critical discovery, warranting further investigation into the underlying reasons. It potentially highlights the need for a nuanced understanding of open innovation within the context of commercial banking.