Group 4; class: Gamba01.N05 CAPSTONE PROJECT REPORT BUILDING THE BUSINESS STRATEGY IN 3G TELECOMMUNICATION SERVICES IN EVNTELECOM IN 2011-2015 Member: Nguyen Duc Hoang Vu Thi Thanh Giang Phan Thi Loan Tran Manh Hai Class: GaMBA01.N05 H A N O I 2 0 1 1 1 Group 4; class: Gamba01.N05 ACKNOWLEDGEMENT We declare the project "Building business strategy in 3G telecommunication services for EVNTelecom in 2011-2015" is the scientific study of our individual group. The results obtained; which so far have not been published in any form; are independent of the research team. To complete the graduate program and write this essay, the group has received great guidance, positive feedback from schools, from teachers, friends and colleagues. On this occasion, the group would like to send our sincere thanks to the ETC, the lecturers participating in teaching MBA program, University of Griggs, especially teachers who have dedicated teaching to give us extremely valuable knowledge during the study at school.
2 Group 4; class: Gamba01.N05 FOREWORDS For over a decade, the world has witnessed the tremendous success of second generation- 2G mobile communication networks. The success of 2G networks is thanks to utility service that it brings to users, typically voice quality and mobility. For over a decade, the third generation - 3G mobile communication network has been deployed around the world. The most prominent improvement of 3G compared with 2G network is the ability to provide high-speed communication package for the deployment of multimedia communication services.
In Vietnam, August 2009, the Ministry of Information and Communication issued 04 3G licenses to 05 telecommunication operators including Viettel Mobile, MobiFone, VinaPhone and EVNTelecom/Hanoi Telecom Association. This event marked a very important period of Vietnam's telecommunication market after a long time having developed rapidly in terms subscribers/services growth. In addition, the policy of deploying 3G telecom network in Vietnam shows the trendy nature of the state management units with the short-cut strategies to head technology helping create growth for the telecom market integrate with the world. On June 9th, 2010 EVNTelecom opened 3G mobile information services to become the fourth operator of 3G mobile communication market.
The accession of EVNTelecom will promote vibrant and competitive market 3G mobile communication in which each operator needs to develop appropriate business strategy - to take advantage of strengths to develop its service market share. Recently, it is obvious that various major carriers globally have come to explore the opportunity to cooperate on telecommunication in Vietnam i. SingTel, France Telecom, SKT, Hutchison, Alcatel Lucent, Telenor, ST Telemedia. have knocked on doors of Vietnam telecom operators with a special desire to cooperate in the array of 3G mobile communication.
These external factors, on one hand, create a push if operators can make good use of partnership opportunities to exploit the 3 Group 4; class: Gamba01.N05 strengths of technology / marketing services, on the other hand they increases the competitiveness of the telecommunications market Thus, should a rational business strategy of EVNTelecom in the coming time be essentially constructed. On the basis of our limited knowledge as well as information collected from market analysis, the topic "Building the business strategy in 3G telecommunication services in EVNTelecom in 2011-2015" was chosen. Purpose of study - Research and systematize the theory on building business strategy, select effective analytical model for development strategy. - Apply theoretical basis system and the above models to analyse, evaluate internal and external environment to build 3G business strategy for EVNTelecom.
- Propose schemes, business strategy for EVNTelecom in 2011-2015 and solutions, petitions to implement the business strategy of 3G services in EVNTelecom. Objectives and the scope of study The study objective is business strategy on 3G telecommunication services for EVNTelecom. Due to limited time and resources, we deeply study analysis and build 3G business strategy (one of the main business areas of EVNTelecom) for the company in the domestic market in 2011-2015, a key period for the development and success of EVNTelecom 3G services. Methods of study To solve the above problems, the report mainly uses strategic analysis techniques: 5 competitive pressures of Michael Porter, PEST analysis, human resource analysis, SWOT Matrix, IE Matrix, SPACE Matrix.
Using the data sources from National Statistics, Ministry of Information and Communication, information, specialized datas; use of secondary data on strategy and previous research and reports of EVNTelecom. 4 Group 4; class: Gamba01.N05 Structure of report The report consists of: Chapter I: Theoretical basis on building business strategy for enterprises Chapter II: Analysis basis to build 3G business strategy of EVNTelecom in 2011 – 2015 Chapter III: Proposed business strategy for 3G services for EVNTelecom in 2011 to 2015 and implementing solutions 5 Group 4; class: Gamba01.N05 Table of Contents CHAPTER I. THEORETICAL BASIS ON BUILDING BUSINESS STRATEGY FOR ENTERPRISES.Overview on business strategy and statement of vision and mission:10 1.1 The concept of strategy, business strategy:.2 Characteristics and the role of business strategy:.3 Concept of vision, Mission and core values:. Fundamental issues in building business strategy:13 1.1 Identify tasks and system of strategic objectives:.2 Analyzing the business environment:.3 The tools to build business strategy and types of business strategies:17 CHAPTER II.
ANALYSIS BASIS TO BUILD BUSINESS STRATEGY FOR EVNTELECOM IN 2011-2015.1 Introduction on EVNTelecom.1 Overview of formation and development of EVNTelecom.2 Functional tasks of EVNTelecom.3 Vision, mission and core values of EVNTelecom.2 Analyzis of the business environment of 3G telecommunication service of EVNTELECOM.1 Analyzis of the macro environment.2 Analyzis of the telecom environment.3 Synthetizis of the opportunities and threats for 3G telecommunications service business.3 EVNTELECOM internal analysis of 3G telecommunications service business.38 6 Group 4; class: Gamba01.1 Analysis of financial capability.5 Sumary of the strengths and weaknesses.43 CHAPTER III: PROPOSED STRATEGY FOR 3G SERVICE FOR EVNTEL IN 2011-2015 PERIOD AND IMPLEMENTATION SOLUTIONS.Business orientation of 3G telecom service in 2011-201545 3.Select business strategy for 3G service from 2011 to 201546 3.1 SWOT Matrix about EVNTELECOM 3G service.2 IE Matrix about EVNTELECOM 3G service.3 SPACE matrix of 3G service.4 Business strategies for 3G services in the 2011-2015 period.Solutions and petitions for the strategy implementation54 3.1 Solutions for the market integration and product development strategies.69 7 Group 4; class: Gamba01.N05 LIST OF ABBREVIATIONS Abbreviations Contents EVNTelecom Electricity of Viet Nam’s telecommunication information company Viettel Military telecommunications group Mobifone Mobile Telecommunication Company Vinafone Telecommunication Services Company S-Fone Center for Mobile CDMA S-Telecom G-tel JSC Global Mobile Telecommunications 3G Third-generation technology 8 Group 4; class: Gamba01.N05 LIST OF TABLES Table Contents Page 1.1 Analyze macro environment 14 1.1 Services provided by EVNTelecom 25 2.2 Table on competitors’capacity assessment 36 2.3 Spreadsheet evaluation of competitors 37 2.4 EFE Matrix of 3G service in EVNTelecom 39 2.5 Some indicators of the financial year 2008-2010 40 EVNTelecom 2.6 Table on operation comparision of EVNTelecom, 41 Viettel and Mobifone 2010 2.7 IFE matrix of EVNTelecom 46 3.1 Transcripts evaluated the impact of external 52 environment and internal environment to 3G services 3.2 Strategy options 54 9 Group 4; class: Gamba01.N05 LIST OF FIGURES AND GRAPHS Figure Contents Page 1.2 Five forces model of M.3 Total critical number of IE matrix 19 1.4 Total critical number of SPACE matrix 20 1.5 System of the business strategy map 21 2.1 Number of mobile subscribers over years 33 2.2 Mobile subscriber market share of network operators 33 in 2010 2.3 EVNTelecom's organization chart 44 3.1 EVNTelecom 3G subscriber forecast to 2015 47 3.2 Target market share of EVNTelecom 3G subscribers in 48 2015 3.3 Forecast sales of EVNTelecom 3G service 48 3.4 The position of 3G service on IE matrix 52 3.5 EVNTelecom’s current distribution channel 69 3.6 Plan for organizing EVNTelecom’s distribution 72 channel 10 Group 4; class: Gamba01. THEORETICAL BASIS ON BUILDING BUSINESS STRATEGY FOR ENTERPRISES 1.1 Overview on business strategy and statement of vision and mission: 1.1 The concept of strategy, business strategy: 1.1 The concept of strategy: Currently there are different concepts of strategy, however, there have not been any concepts that fully describe the nature of this activity, each concept has different points depending on the views of the author. However, in general, all concepts focus on four categories: plan, model, location, and perspective. Based on these categories, strategy is: A plan to know how from one thing can achieve another.
A long-term activity, for instance, a company often markets expensive products means they are applying the strategy of “focus on high-income customers”. Location shows the decision to bring particular products or services into particular markets. Perspective shows the vision and direction enable the company or organization development.2 The concept of business strategy: Business strategy of an enterprise is an art of building long-term objectives and policy direction and implementation to create its competitive advantage. Business strategy helps us understand: Where the enterprise reaches for in the long term (direction)? In which market enterprises must compete and what kind of business activity conducted on that market (market size)? 11 Group 4; class: Gamba01.N05 How will enterprise do better than its competitors on that market (advantages)? Which resources (skills, properties, finance, relationships, technical ability, facilities) are necessary to compete (resources)? How external environmental elements affect competitiveness of enterprises (environment)? What are expectations of powerful people in and out of the enterprises (share-holders)? 1.2 Characteristics and the role of business strategy: 1.1 Characteristics of business strategy The objective The relevance The orientation, long-term The flexibility The continuity The competitiveness 1.2 The role of business strategy: Enterprises who wish to conduct sustainable development in the future must have properly business strategy.
Hence, business strategy plays a vital role in the existence of enterprises. Business strategy brings out various benefits for enterprise: Help enterprise orientate its activity in the future by analyse and forecast business environment. 12 Group 4; class: Gamba01.N05 Help businesses to capture opportunities as well as full risk for the development of enterprise resources, it helps enterprises to exploit and rationally use resources, promoting the power of business. • Strategies help create a trajectory operation for the business which helps business link individuals with different interests towards a common objective and business development.
Business strategy is an effective competitive tool of enterprises.3 Concept of vision, Mission and core values: 1.1 Vision A vision statement is a report about where your company would achieve. Vision statement outlines the future of your company as you achieve your goals and targets. Vision statements can be different in the length; it can be a concise sentence, or a long paragraph but it is important to define the destination of the enterprise.2 Mission Mission Statement is a document aimed at informing the existence of your company. A mission statement defines values and rules governing your company and is an essential part in the process of strategy planning.
Missions may vary in length and about the business, purposes and values. Mission statement is the foundation for the company's vision. Statement of mission can be motivation for the staff to convey the purposes and values of the company to customers and society.3 Core value Core value is an essential element and long-term belief of an organization. As a small group of thousand years guiding principles, core values require no 13 Group 4; class: Gamba01.N05 external evidence, they are valued and intrinsically important for anyone in the organization.
Core value system is the main engine motivating people to work, playing as nuclear to connect people in the enterprise, business with customers, business partners, and enterprise society in general. (Source: http://vi.2 Fundamental issues in building business strategy: 1.1 Identify tasks and system of strategic objectives: 1.1 Identify tasks of strategy formulation Strategic mission is a long-term fixed statement on the purpose of the enterprise, which differentiates one enterprise to the others. The statements may be business principles, objectives and philosophies from which business fields of products and services, market demand are identified.2 Identifying strategic objectives Strategic objectives: The objective is the future state that business has been trying to realize or is the result of the planned activities.