Factors influencing digital transformation adoption of bank employees in Vietnam

during business recovery: A TAM approach.

Introduction

I. Background
     The outbreak of the Covid-19 pandemic has forced governments around the world to
execute prolonged isolation orders to prevent the continuous spread of the virus in the
community. This has made a significant impact on the economies of many countries,
including Southeast Asian (Vu, Lai & Phan, 2022). During this period is also the time
when businesses have to change their operating and business strategies to be able to
survive and overcome that period of severe economic crisis. Typically, in the banking
industry, banks have now applied digitization to their operation and customer care
systems. Mai Hanh (2022) believed that Covid-19 has become a catalyst for digital
transformation of the banking industry in Vietnam, helping banks successfully overcome
the pandemic and stabilize in the economic recovery period post Covid pandemic.
Consumers during Covid isolation have gradually prioritized online payment services,
opening cards online, loaning online, etc. In addition to online services for customers,
banks in Vietnam also thoroughly apply digital transformation such as cloud computing,
data digitization, with a view to create a digital ecosystem (Ngo Hai, 2022). Although the
application of digital transformation in the banking industry was not unfamiliar before,
according to Mr. Le Anh Dung, Deputy Director of the Payment Department, the State
Bank of Vietnam, it was during the Covid-19 that digital transformation in the banking
industry has been accelerated, while also responding to changes in consumer behavior
(Mai Hanh, 2022). 

II. Rationale
There is a need to carry on this research because according to Ngo Hai (2022), in
order to succeed in the digital transformation process, banks not only need to focus on
adapting digitalization, but also on changing awareness and perspective of leaders and
employees in the system. Madsen et al. (2005) proposed that to ensure the readiness of
any businesses, staffs must also be receptive, ready, and willing to adapt. Bernerth (2004)
believed that employees’ readiness plays a vital part in the success of making changes
within the organization. However, accepting changes is not an easy job, especially in the
context of business recovery post Covid-19. Although digital transformation has been
applied by banks before, it is not until the post-Covid-19 period - the period of economic
recovery - that banks accelerate the progress of digital transformation to meet the needs
of consumers. Logically, accelerating digital transformation can negatively affect
employees' attitudes - they may not be ready to accept, or do not have the capacity and
experience to accept changes regarding transformation in the workplace. Moreover,
Belak and Ušljebrka (2004) stated that a negative attitude towards changes might lead to
disappointment, discontent among employees; labor postponement; and even job quitting.
Overall, it is important to investigate the factors that can affect employees’ adoption
of digital transformation in the banking industry in Vietnam during business recovery
because employees’ attitude is a crucial key that contribute to the success of the
organization. Interested in the technology acceptance aspect of this wave, specifically in
how people working in the Vietnamese banking industry perceive with regards to new
technologies in their daily operation, and because there has been no prior study on how
bank employees react to digital transformation in the post-Covid-19 world, our group
decided to conduct a detailed report on how bank employees react to digital
transformation in the post-Covid-19 world. We want to give a practical contribution to
executives of Vietnamese financial firms in order to support their workers' transition to
the new digital era.

The aim of this research is to identify the factors influencing employees’ adoption of
digital transformation in the banking industry during business recovery post Covid-19 in
Vietnam; more specifically, to examine the relationship between those factors and the
attitude of banking employees using Technology Acceptance Model (TAM).  
 III. Research question
Considering the adoption of digital transformation in the banking industry in Vietnam
during business recovery, what are the major factors that might affect employees’
attitude?

IV. Research objectives

This research is aimed:

1. To evaluate and examine the influence of Perceived Usefulness (PU) on

employees’ attitude.
2. To evaluate and examine the influence of Perceived Ease of Use (PEOU) on
employees’ attitude.
3. To evaluate and examine the influence of Task Technology Fit (TTF) on
employees’ attitude.
4. To evaluate and examine the influence of Perceived Risks (PR) on employees’
attitude.

V. Research gap

Literature Review

I. The Technology Acceptance Model (TAM)

The Technology Acceptance Model (TAM) is intended to assess the adoption of new
technology based on consumer attitudes, and it is more specifically concerned with the
forecast of an information system's acceptability. TAM was by Fred Davis in 1986, while
he was a member of the Computer and Information Systems department at the University
of Michigan and was seeking for a means to anticipate as well as define system
utilization for vendors and IT managers.

The model was built on the Theory of Reasoned Action, and it provided a
psychological viewpoint on human behavior that was underrepresented in the IS literature
at the time. TAM's key objective was to shed light on the mechanisms behind technology
acceptance in order to forecast human behavior and give a conceptual definition for
effective technology deployment. TAM's practical goal was to educate professionals
about actions they may adopt in advance of system implementation.

According to TAM, the effectiveness of new technology adoption is tied to two

measures: perceived usefulness and perceived ease of use. The degree to which a person
feels that using a system would improve his performance is referred to as perceived
usefulness. The degree to which a person feels that using a system will be simple is
referred to as perceived ease of use.

The Technology Acceptance Model proposes that the employment of an information

system is driven by behavioral intention, but that behavioral intention is also controlled
by the person's attitude toward the system's usage as well as his judgment of its value.
According to Davis, an individual's attitude is not the only thing that affects his adoption
of a system; it is also influenced by the effects it may have on his performance. As a
result, even if a staff does not appreciate an information system, the likelihood that he
will utilize it is considerable if he believes that the system would benefit his quality of
work.

Davis argued that perceived ease of use impacts an individual's attitude via two key
mechanisms: self-efficacy and instrumentality. Bandura (1982) introduced the notion of
self-efficacy, which states that the easier a system is to use, the better the user's
perception of effectiveness. Furthermore, an easy-to-use tool will give the user the
impression that he has power over what he is undertaking. Efficacy serves as one of the
primary variables behind intrinsic motivation (Bandura, 1982), and it is what
demonstrates the direct relationship between perceived ease of use and attitude in this
case. Perceived ease of use can also play an important role in increasing a person's
performance. Because the user will have to invest less effort with an easy-to-use tool,
they will have more time to dedicate to other responsibilities.
 According to the research presented by Davis (1989) to justify his model, the
relationship between the intention to utilize an information system and perceived
usefulness is greater than perceived ease of use. Based on this model, the perceived
usefulness of a tool should be the most influential element for a user.

Even though there are several modifications of the model, the original Technology
Acceptance Model is widely recognized as follows:

Figure 1: TAM by Fred Davis 1986

Many researchers have later modified and enhanced this model, developing more
intricate versions, but the original model is still implemented and widely known, as it is
still the precursor of assessing user experience and the questions used in the initial study
are still applicable today.

After an initial trial, this model may be used to contemplate the roll out of a new piece
of technology throughout the entire business. It may also be used to conduct employee
surveys to determine perceived usefulness and perceived of use. By rating responses on
the rating below, researchers may generate a score for each value, which then can be used
to assess the firm staff's overall attitude towards the newly implemented technology.
 Figure 2: Rating scale

II. Technology acceptance factors in banking

1. Task Technology Fit (TTF)

The Task Technology Fit (TTF) can extend the usefulness of TAM model by

concerning the effects of tasks to uses; in which the model describes the interrelationship

among three components, including task requirements, technology functionality and

capabilities of individuals (Goodhue and Thompson, 1995). The concept of TTF also was

developed by Zigurs and Buckland in 1998, but there are some differences on how they

viewed the concept; Goodhue and Thompson (1995) concentrated on the suitability

between technology, task and individual while Zigurs and Buckland (1998) focused on

how tasks and technology can interact on group performance (Andersone et al., 2021). 

Indeed, TTF theory discusses about the relationship between digital technology and all

the tasks it proposed to be considered; it has been considered as an instruct evaluation in

various aspects of technology to gain understandings about how technological uses

affects performance impacts. Some measurements of TTF could be listed based on the

users’ experiences with the data’ quality, or reliability of technology (Anderson et al.,

2021). When “task” is the concept of actions that turning inputs into outputs, its

characteristics closely linked to the interactions of employees with technologies. At the

developed context of e-banking, the importance of TTF is shown on how technology can

assist employees in performing their jobs (Riyadh et al., 2016). Therefore, the TTF model
will be chosen to critically analyze the matched relations between tasks’ characteristics

and the employees’ capacities on TAM model.

2. Perceived Risk

Raymond Bauer (1960) was proposed the theory of perceived risk to identify the

behavior of users then examining how they can affect on several factors, such as

performance risk, financial risk, privacy risk, time, and social risk, etc. Nowadays, as the

explosion of digital transformation in most of industries, there are changes on the

definition of perceived risks when online transactions become more and more popular, as

a result; the banking sector do not exclude on this trend. Research also shows that the

perception of individuals on perceived risk is crucial in how they are adopting (Mutahar

et al., 2018). Previous research showed that the perspective towards perceived risks is a

vital factor need to be considered (Lai, 2015). Research also pinpointed that consumers

may face with great risks and uncertainty when adopting technology, regarding their

trustworthy towards the usefulness of technology. The research of Mutahar et al. (2018)

showed some outstanding findings in terms of how perceived risk influences on the

perceived ease of use (PEOE) and perceived usefulness (PU) of customers, and there is

also a need to survey the similar variables on employees.

Research Model and Methodology

I. Research model
This research inherits the original TAM by Fred Davis (1986), follows by 2 other
variables including Task Technology Fit and Perceived Risk.
 Figure 3: Research model

II. Hypotheses and Methodology

 
 
 

 
  
 Reference List 
1. Bandura, A., 1982. The assessment and predictive generality of self-percepts of

efficacy. Journal of Behavior Therapy and Experimental Psychiatry, 13(3),

pp.195-199.
2. Belak, S. & Ušljebrka, I. (2014). Organizational Culture as a Factor in the
Successful Implementation of Organizational Changes. Oeconomica Jadertina. 
3. Bernerth, J. (2004). Expanding Our Understanding of the Change Message.
Human Resource Development Review. Vol.3, No.1.  
4. Davis, F. (1989). Perceived Usefulness, Perceived Ease of Use, and User
Acceptance of Information Technology. 1st ed. [eBook] Minnesota:
Management Information Systems Research Center, pp.319-340. Retrieved
from:
http://iris.nyit.edu/~kkhoo/Spring2008/Topics/TAM/PercieveUsefulness_MIS.
pdf [Accessed 19 October 2022].
5. Lai, P. (2015). Perceived Risk As An Extension To TAM Model: Consumers’
Intention To Use A Single Platform E-Payment. Retrieved from:
https://www.researchgate.net/publication/296775473_Perceived_Risk_As_An_
Extension_To_TAM_Model_Consumers'_Intention_To_Use_A_Single_Platfo
rm_E-Payment
6. Madsen, S.R., Miller, D. & John, C.R. (2005). Readiness for Organizational
Change: Do Organizational Commitment and Social Relationships in the
Workplace Make a Difference? Human Resource Development Quarterly.
Vol.16, No.2.  
7. Mai Hanh (2022). Covid-19 “chat xuc tac” trong tang toc chuyen doi so cua
nganh ngan hang. VOV. Retrieved from: https://vov.vn/kinh-te/covid-19-chat-
xuc-tac-trong-tang-toc-chuyen-doi-so-cua-nganh-ngan-hang-post932841.vov
[Accessed 22 October 2022]. 
8. Mutahar, A. and Daud, N. (2018). The affect of awareness and perceived risk
on the TAM model: mobile banking and Yemen. Retrieved from:
 http://osamaisaac.com/wp-content/uploads/2020/08/9-Mutahar-et-al.-2018-
IJSS-Inderscience.pdf?
fbclid=IwAR3eYszzcqeU9V68BDW_YZMfrykJdNPYWkCMF9Yw_E0FoRI
3AVpouq_g6_s
9. Nath, R., Bhal, K (2013). Factors influencing IT Adoption by Bank
Employees: An Extended TAM Approach.
10. Nelda, A., Giulia, N., Ipsen, C. (2021). TASK-TECHNOLOGY FIT
THEORY: An approach for mitigating technostress. Available at: 
https://www.researchgate.net/publication/352509292_TASK-
TECHNOLOGY_FIT_THEORY_An_approach_for_mitigating_technostress
11. Ngo Hai (2022). Ngan hang “nem trai ngot” tu chuyen doi so thanh cong. Tap
chi Thi Truong Tai chinh Tien te. Retrieved from:
https://thitruongtaichinhtiente.vn/ngan-hang-nem-trai-ngot-tu-chuyen-doi-so-
thanh-cong-42493.html [Accessed 22 October 2022]. 
12. Riyahdh, H., Eko, S., Zaki, B. (2016). E-BANKING IMPLEMENTATION
AND TECHNOLOGY ACCEPTANCE IN THE RAFIDAIN AND
RASHEED BANKS IN IRAQ: AN EMPLOYEE PERSPECTIVE. The
International Journal of Accounting.
13. Vu, C.N., Lai, C.M.P. & Phan, M.X. (2022). Tac dong cua dai dich COVID-19
va mot so khuyen nghi cho nganh ngan hang tai Viet Nam. Tap chi Thi truong
Tai chinh Tien te. Retrieved from: https://thitruongtaichinhtiente.vn/tac-dong-
cua-dai-dich-covid-19-va-mot-so-khuyen-nghi-cho-nganh-ngan-hang-tai-viet-
nam-40289.html [Accessed 22 October 2022].