CAPSTONE PROJECT REPORT BUILDING BUSINESS STRATEGY FOR SONG DA 2 JOINT STOCK COMPANY FOR THE PERIOD 2012 - 2016 Nguyen Van Son Le Trong Loi Vu Thi Thu Hien Pham Thi Mai Huong Class GAMBA01. X0710 HA NOI 2011 COMMITMENT We hereby assure that this report is the results of our group. The data and figures stated in the report are true and original. We also state that the analysis in the assignment belongs to the whole group basing on references and learnt knowledge.
The analysis in this assignment is not statement of any group member as a staff working for their organization. Hanoi, November 2011 AUTHORS Nguyen Van Son Le Trong Loi Vu Thi Thu Hien Pham Thi Mai Huong GaMBA01.X0710 – Group 5 i Capstone Project ACKNOWLEDGEMENTS We would like to express our sincere thanks to the lecturers from Master of Business Administration training program - Griggs University in Vietnam who have guided us in the course of the study. In particular, special thanks are sent to the leadership and officials and employees of Song Da 2 Joint Stock Company who have enthusiastically helped us with support and assistance in the process of gathering documents, data and organizing working sessions to help us have a practical view on the construction of the development strategy of the company. In addition, we would like to express our sincere thank to Professors, Doctors who have provided us with the skills and knowledge of corporate governance throughout the course.
This knowledge serves as fundamental foundation for us to conduct the graduation report as well as to apply the theory into the practical work. And particularly, we would like to thank the valuable guidance of Assoc. Ngo Kim Thanh and Assoc. Arthur Gogatz for us to complete this study.X0710 – Group 5 ii Capstone Project TABLE OF CONTENTS PREFACE: GENERAL INTRODUCTION.
Overall background, the necessity and importance of the study. Objectives of the Study. Methodology of the study. Structure of the Capstone project:.3 CHAPTER I: THEORITICAL BACKGROUND FOR BUILDING BUSINESS STRATEGY.
The concept of business strategy. The process of developing business strategy. Vision and Mission Statements. External environment analysis.
Macro environment analysis. Competitive and sector environment analysis. Competitive profile matrix. External Factor Evaluation matrix (EFE matrix).
Internal environment analysis. Internal Factor Evaluation Matrix (IFE). Determination of the competition position of businesses. Selection of business strategies.
Quantitative Strategic Planning Matrix – QSPM.12 CHAPTER II: ANALYZE THE CURRENT STATUS OF SONG DA 2 JSC.1 Introduction of Song Da 2 JSC. Organizational structure of the company. Production and business situation in 2008- 2010 and 6 months of 2011. Vision, mission, and core values.3 Analyze the business situation of Song Da 2 Joint Stock Company.1 Analysis of external environment:.1 Analysis of the macro environment:.2 Industry analysis and competition.
Opportunities and Threats. External Factor Evaluation Matrix (EFE). Analysis of internal environment. Strengths and Weaknesses.
Internal Factors Matrix (IFE). Mc Kinsey Matrix– GE.X0710 – Group 5 iii Capstone Project CHAPTER III: PROPOSED STRATEGIES AND SOLUTIONS FOR IMPLEMENTATION. Objectives and main tasks of Song Da 2:. Proposed strategy plan for the period 2012 – 2016.
Selection of business strategy. Quantitative Strategic Planning Matrix (QSPM).2 Strategy of Song Da 2 for the period 2012-2016.1 Business strategy at the company level.2 Business strategy at the department level.3 Solutions to perform business strategy for the period 2012-2016.1 Marketing Management Solutions.2 Solution group on manufacturing administration.3 Human resource management solution group.4 Financial administration solution group.5 Enterprise organization and development measure. Strategies Implementation Timeline. Some recommendations to the Authorities and the State.1 Recommendation to Song Da Group.
Recommendation to the Government and the Authorities. 60 LIST OF FIGURES Figure 1. The process of planning business strategy. The model of 5 competitive forces of Michael E.
Mc Kinsey Matrix. Organizational Structure of Song Da 2 JSC.16 Figure 5: Diagram of revenue and profit criteria of Song Da 2 JSC.18 Figure 6: Matrix Mc Kinsey – GE. The process of planning business strategy. The model of 5 competitive forces of Michael E.
Mc Kinsey Matrix. Organizational Structure of Song Da 2 JSC.16 Figure 5: Diagram of revenue and profit criteria of Song Da JSC.18 Figure 6: Matrix Mc Kinsey – GE.41 Figure 7: Internal-external factors matrix (IFE - EFE).X0710 – Group 5 iv Capstone Project GaMBA01.X0710 – Group 5 v Capstone Project LIST OF TABLES Table 1: Competitive profile matrix. 8 Table 2: External Factor Evaluation Matrix.8 Table 3: Internal Factor Evaluation Matrix.10 Table 4: SWOT Matrix.12 Table 5: QSPM Matrix.13 Table 6: Competitive Profile Matrix of Song Da 2.27 Table 7: Opportunities and Threats. 29 Table 8: External Factor Evaluation Matrix of Song Da 2 (EFE).
The general table of cadres, engineers, technicians of Song Da 2. The general table of technical workers of the company Song Da 2.31 Table 11: Structure of assets and capital resource.33 Table 12: Financial index.34 Table 13: Strengths and Weaknesses.38 Table 14: Internal Factors Matrix (IFE) of Song Da 2.39 Table 15: SWOT Table. 42 Table 16: SWOT Matrix of Song Da 2. Strategies Implementation Timeline for Song Da 2 JSC.X0710 – Group 5 vi Capstone Project PREFACE: GENERAL INTRODUCTION 1.
Overall background, the necessity and importance of the study All over the country, the construction industry has made significant works at national and regional levels. The practical contribution, huge effects on the industrialization - modernization process of the country are the most vivid evidence for the remarkable development, growth of Vietnam Construction industry in the context of international economic integration. However, as well as other economic sectors, the Construction industry is facing with common challenges such as price volatility, rather high bank interest rate. which have posed significant impacts on production and business activities of the companies in the industry.
In order to achieve their goals, the businesses are required to have appropriate business strategy to fully take advantage of business opportunities and constraint at the lowest level of risk, thereby improving their efficiency and competitiveness. Developing a sound strategy means that the enterprises have had a guideline on the way of their business. For over 30 years of construction and growth, Song Da 2 Joint Stock Company has significantly contributed to the development of Construction industry, contributing to the significant development of our economy with civil works, irrigation, transportation, construction, transportation material business, etc. The development of business strategy for the company plays an important role for long-term growth orientation of the company in particular and the construction industry in general.
Therefore, we have chosen the study subject “Building Business Strategy for Song Da 2 Joint Stock Company for the period 2012 – 2016’ 2. Objectives of the Study The specific goal of this study is to build the business strategy for the development of Song Da 2 Joint Stock Company during the period from 2012 to 2016. Specifically as follows: The rationale for developing strategies for business. 1 Analysis of the basis for developing strategies for business: the business environment (micro and macro environment); internal factors; portfolio.
Identifying strengths, weaknesses, opportunities and challenges of the company Proposing and selecting business strategy suitable for the company during the period 2012 - 2016 and measures to implement the strategy effectively. The achievement of the study will bring about meanings in terms of theory and practice for those managing enterprises in general and Song Da 2 Joint Stock Company in particular. Specifically: - The topic can help those managing and operating enterprises have the general view of the enterprise’s business strategy, improve knowledge and skill of building and presenting the enterprise’s business strategy. - This topic lifts the importance and meanings of analyzing and forecasting the business environment of the enterprise, estimating the effect level of the enterprise’s external environmental factors, internal factors in building and analyzing matrixes within the frame of analyzing the strategy completion.
- The topic supplies Song Da 2 Joint Stock Company with a good reference source and a specific strategy in the period of 2012 – 2016, which is a meaningful period for the development history of the company. This source includes the general strategy, the partial strategies and the solution group to implement the strategy successfully. Methodology of the study Analyzing the business environment of the company from 2008 to June 2011 in order to formulate the strategic direction for the company in the period 2012 to 2016. Data collection methods: Using both the primary and secondary data such as: - Secondary data are collected through sources such as newspapers, television and Internet, internal documents of the company, reports, and construction journals.
2 - Primary data are collected through working meetings with the leaders, officers and employees working at the company; interviews with appropriate experts. Comparison and synthesis methods: Comparison of appropriate data on space, time and economic contents, units of measurement, calculation, scale and business conditions. Statistical methods by tables, charts: Statistics helps to find out trends or common characteristics of the elements analyzed. Expert Method: Building strategic matrixes by consulting opinions of many experts to draw conclusions.
SWOT Method: Finding out the strengths and weakness within the company, opportunity and risk outside the company. This is a key method in strategic planning. Structure of the Capstone project: This assignment is presented in three chapters: Chapter 1: Rationale for business strategy planning Chapter 2: Analyze the current status of Song Da 2 Joint Stock Company Chapter 3: Proposed Strategies and Solutions for Implementation 3 CHAPTER I: THEORITICAL BACKGROUND FOR BUILDING BUSINESS STRATEGY 1. The concept of business strategy Different scholars have different points of view on business strategy from many different angles.
Under the traditional approach, strategy is the determination of basic long term objectives of the business and implementation of its action plan with the allocation of necessary resources to achieve the objectives. It can also be seen that strategy is a method that businesses use to guide their future so as to achieve and sustain their growth. In 1962, Chandler defined strategy as the identification of basic long-term objectives and goals of enterprises and the application of a course of actions as well as the allocation of necessary resources to achieve these objectives"1. According to Johnson and Scholes, "Strategy is the long-term direction and scope of an organization in order to gain competitive advantages through the format of its resources in a changing environment to meet market demands and the expectations of stakeholders"2 According to Bateman and Zeithaml, "Strategy is a harmonious combination of activities and the allocation of resources to achieve the objectives of an organization.
The strategy of an organization is the attempts to maximize the capabilities and resources of that organization to have best response to opportunities and challenges of external environments”3 Currently, business strategy is defined as “an integrated and coordinated set of commitments and actions the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets.4 1 Chandler, A (1962), Strategy and Structure. 2 Johnson, G, Scholes, K (1999), Exploring Corporate Strategy, 5th Edition. Prentice Hall Europe 3 Bateman và Zeithaml,( 1990) 4 Michael A. Duane Ireland, Robert E.
Hoskisson , Strategic Management : Competitiveness and Globalization: Concepts, 9th Edition, South-Western Cengage Learning, (2010):100. The process of developing business strategy The process of planning business strategy is described in Figure 1 below: Figure 1. The process of planning business strategy Chức năng nhiệm Vision andvụ & mụcStatements Mission tiêu chiến lược của doanh nghiệp (Vision and Mission Statements) External environment Internal environment analysis (O, T) analysis (S, W) Strategy selection Company-level strategy Divisional-level strategy Strategy implementation Review and evaluation Feedback Feedback 3. Vision and Mission Statements The importance of the vision statement is said by Warren Bennis as follows: ".
what the best leaders have to do is to create not only simple vision but a meaningful and significant vision. This vision makes people engage in the implementation, not just standing on the sidelines but enjoying.