Capstone project Global Advanced Master of Business Administration CAPSTONE PROJECT ESTABLISHMENT OF BUSINESS STRATEGY OF THANH HOA MEDICAL MATERIALS PHARMACEUTICAL JOINT STOCK COMPANY (THEPHACO) IN THE PERIOD 2021 - 2025 TABLE OF CONTENTS ACKNOWLEDGEMENT 1 Capstone project LIST OF ABBREVIATIONS LIST OF TABLES AND GRAPHS FOREWORD I. Necessity of the topic II. Purpose of research of the topic III. Object, scope and method of research IV.
Structure of the topic CHAPTER 1: THEORETICAL BASIS OF BUSINESS STRATEGY 1.1 Concept of business strategy 1.1 Concept of business strategy 1.2 Classification of business strategy 1.2 Role of business strategy 1.3 Business strategies in reality 1.4 Process of establishing business strategy 1.1Analysis of macro environment 1.2Analysis of micro environment 1.2 Analysis inside the enterprise 1.1Analysis and evaluation of resources: 1.2Analysis of operation of functional divisions of the Company 1.3Internal factor evaluation matrix (IFE) 1.3 Establishment and selection of strategy CHAPTER 2: ANALYSIS OF BUSINESS ENVIRONMENT OF THANH HOA MEDICAL MATERIALS PHARMACEUTICAL JOINT STOCK COMPANY 1.5 General introduction about Thanh Hoa Medical Materials Pharmaceutical Joint Stock Company 1.1 Formation and development 1.2 Organizational structure of Thephaco 1.3 Operation result of Thephaco over the past years 1.1 Business result and market share Capstone project 1.6 Analysis of external environment impact on the operation of Thephaco 1.1 Analysis of macro environment 1.1 Political and law factor 1.2 Socio-cultural factor 1.2 Operation environment of the company (micro) 1.1 Economic characteristics of the industry 1.2 Pressure from the suppliers 1.5 Pressure and threat from potential competitors 1.3 Competitive image matrix 1.4 External factor evaluation matrix (EFE) 1.7 Analysis of internal environment impact on the business activities of Thephaco 1.1 Analysis of Management Model 1.2 Analysis of human resources 1.4 Financial - accounting analysis 1.7 Market research and development 1.8 Internal factor evaluation matrix (IFE) Capstone project CHAPTER 3: ESTABLISHMENT OF BUSINESS STRATEGY OF THANH HOA MEDICAL MATERIALS PHARMACEUTICAL JOINT STOCK COMPANY (THEPHACO) IN THE PERIOD 2011 - 2015 1.8 Establishment of development objective to 2015 1.1 Determination of position, vision and objective of Thephaco 1.2 Basis for objective determination 1.9 Analysis of business strategies 1.1 According to SWOT matrix 1.2 According to strategic posturing and action evaluation (SPACE) 1.3 According to internal - external factor matrix (IE) 1.10 Preliminary selection of strategy schemes 1.11 Quantitative strategic planning matrix (QSPM) 1.12 Follow-up of strategies 1.1 Thephaco market development strategy 1.2 Product development strategy 1.3 Marketing and communication strategy 1.4 Human resources management strategy: 1.5 Capital source development strategy 1.6 Production technology strategy CONCLUSION REFERENCES Capstone project ACKNOWLEDGEMENT! First of all, our group would like to present our most sincere thanks to the Program Leadership, lecturers of the Center for Educational Technology and Career Development, Postgraduate Faculty - Vietnam National University - Hanoi; USA Griggs University for creating favorable conditions and helping us during the course as well as completing our Graduation assignment with the assigned research topic to the best result. At the same time, we are also thankful to the Leadership and related Departments of Thanh Hoa Medical Materials Pharmaceutical Joint Stock Company for enthusiastically providing necessary figures and creating all favorable conditions for us to do this topic. However, due to limited time, shortcomings in the analysis of the topic are inevitable. For this very reason, the group 11 does wish to receive contributive ideas from the Lecturers so that our topic is better and applied effectively in the reality of the Company.
We hereby undertake that this topic is our independent research. The figures and results included in the Assignment are true and of clear origin. GROUP OF AUTHORS Capstone project LIST OF TABLES - CHARTS Table 1-1 Phases in the strategy construction process Chart 1-2 SWOT matrix Table 1-3 Space matrix Table 2-1 Management apparatus diagram of Thephaco Table 2-2 Analysis of financial targets through years Table 2-3 Competitive image matrix in the field of pharmaceutical products of Thephaco Chart 2-4 External factor evaluation matrix of Thephaco Chart 2-5 Product distribution market ratio Chart 2-6 Production capacity of groups of products of Thephaco Chart 2-7 Internal factor evaluation matrix of Thephaco Chart 3-1 Objectives for each year in the period 2011 - 2015 Table 3-2 SWOT matrix of Thephaco Table 3-3 Space matrix of Thephaco Chart 3-4 Overall shape of Space matrix Table 3-5 Internal - external factor matrix (IE) Table 3-6 Strategy proposals in each matrix Table 3-7 QSPM of pharmaceutical products - Centralized growth strategy group Capstone project LIST OF ABBREVIATIONS In this work, terms are understood as follows: Thephaco Thanh Hoa Medical Materials Pharmaceutical Joint Stock Company DN Enterprise IFE Internal factor evaluation matrix EFE External factor evaluation matrix SPACE Strategic posturing and action evaluation matrix. QSPM Quantitative strategic planning matrix GMP Good Manufacturing Practice GLP Good Laboratory Practice GSP Good Storage Practice GDP Good Distribution Practice GPP Good Pharmacy Practice WHO World Health Organization TRAPHACO TRAPHACO Joint Stock Company PHARBACO Central Pharmaceutical Joint Stock Company No.
1 - PHARBACO DHG Hau Giang Pharmaceutical Joint Stock Company Capstone project FOREWORD I. Necessity of the topic Vietnam has approached the market economy for more than 20 years, a sufficient period for the enterprises to adopt management methods of market mechanism. Strategy management has been regarded as one of the important business philosophies that help the enterprises to gain successes in the long term. However, the adoption of this theory must still be considered with most Vietnamese enterprises.
Thanh Hoa Medical Materials Pharmaceutical Joint Stock Company (Thephaco) was formerly known as Thanh Hoa Pharmaceutical Company, established in 10/4/1961, designed to produce, trade, import and export medicine all over the province and the country. For many years of formulation and development, with the motto of highlighting product quality, Thephaco has invested and built the factory to the standard GMP - WHO, GLP and created confidence in the national market. The trademark THEPHACO is increasingly firm in the pharmaceutical market, some articles have been exported to Russian and Laos. Yet, in the present competitive context, especially the participation of foreign companies, Thephaco realizes that it is necessary to prepare necessary resources to adapt to change and sustainable development.
With such significance, the topic “Business strategy in the period 2011 - 2015 of Thanh Hoa Medical Materials Pharmaceutical Joint Stock Company” is selected the group 11 for the graduation assignment of Master of Business Administration. We do hope to receive contributions from the Lecturers in the council and all of classmates so that the strategy is actually persuasive and can be applied into real life. Purpose of research of the topic The topic focuses on researching the following issues: - Basic theories about strategy and strategy management. - Useful analysis models for strategy formation and selection.
1 Capstone project - Actual performance of strategy of Thephaco. - Analysis of internal and external environment factors that impact the strategy performance of the company. - Appropriate solutions to establish development strategy of Thephaco. Object, scope and method of research - Object and scope: The thesis focuses on researching present strategy management activities for the products of Thephaco and putting forth solutions in the coming time.
- Method of research: The thesis uses two main types of information, namely primary information and secondary information. Secondary information is collected from various sources, remarkably reports on operation and marketing supplied by Thephaco. Besides, secondary information coming from open sources in the Internet is also used in the report. Structure of the topic Chapter 1: Theoretical basis about business strategy Chapter 2: Analysis of business environment of Thanh Hoa Medical Materials Pharmaceutical Joint Stock Company Chapter 3: Establishment of business development strategy of Thanh Hoa Medical Materials Pharmaceutical Joint Stock Company in the period 2011 - 2015 2 Capstone project CHAPTER 1: THEORETICAL BASIS ABOUT BUSINESS STRATEGY 1.
Concept of business strategy: 1. Concept of business strategy: There are many different definitions of strategy, each of them has many different points depending on the viewpoint of each author. According to traditional viewpoint, “Strategy is the direction and scope of an organization in the long term: strategy will bring about advantage to the organization through optimal arrangement of resources in a competitive environment in order to meet the market demand and expectation of the capital contributors” According to Alfred Chandler (1): “Strategy includes long-term basic objectives of an organization, concurrently choosing way or process of action, allocating essential resources to carry out such objectives”. According to Fred R.
David (2): “Strategy is defined as means to achieve long-term objectives. Business strategy may include geographical development, activity diversification, ownership, product development, market penetration, cost reduction, liquidation and joint venture”. According to Michael E. Porter (3): “Strategy is the art of establishing stable competitive advantages for defense”.
Classification of business strategy: There are many kinds of strategies used in an organization, yet basically, there are three applicable levels of strategy: - Strategy at company level: Putting forth objectives and business activities of the company, creating basic policies and plans to achieve objectives. - Strategy at business level: Determining business market of the company, dividing segment and product for each type of market. - Strategy at functional level: Determining solutions and plans for each field of business. Role of business strategy: The management of business strategy will enable the Enterprises: 3 Capstone project - To specify purpose, position to find out proper direction as a basis for all specific action plans, guideline for all production and business activities of the enterprise.
- To determine opportunity and threat from external environment as well as internal strength and weakness to promote strengths, minimize weaknesses, grasp opportunities and prevent external risks. - To select appropriate competitive advantage in the changing business environment, find out how to enhance efficiency of using resources for survival, enhance competitive position and enable the Enterprise to gain sustainable development. - Business strategy is a stable ground to put forth decisions for the enterprise in accordance with the market change. Business strategies in reality: - Market share consolidation strategy: Consolidating position, enhancing image and prestige of the Enterprise, expanding scope of production, enhancing labor productivity and further penetrating into the market.
- Product and service diversification strategy: Diversifying product and orientating product to the customer’s demand. Investing in modern production line to put forth many types of products for domestic market and export, especially specialized products. - Distribution network expansion strategy: Diversifying and expanding distribution channels of the Enterprise, expanding locality to provide the customer with the most convenience in transaction, thereby attracting customers and increasing competitiveness. - Concentration strategy: The enterprise concentrates its all resources in order to achieve growth objective and high efficiency.
- Differentiation strategy: Establishing the plan based on the available and typical strength of the enterprise to achieve the objective. Process of establishing business strategy: Establishing of business strategy is the process of determining basic objectives and duties in the business operation of enterprise, the best methods to carry out key objectives 4 Capstone project and duties. It is possible to summarize phases and activities during the strategy establishment through the following table: Steps Content Step 1 Systemizing information Step 2 Combining information to put forth collection of feasible business strategies Step 3 Using all general evaluation information to select the best business strategy for the enterprise. Table 1-1: Phases in the business establishment process Strategy formulation is the process of establishing business task, conducting investigation and research to determine internal and external limitations, set long-term objectives and select among substitute strategies.
It is also possible to call this strategy establishment phase. Accordingly: Step 1: Collecting data, combining with intuition, analyzing actuality and choosing feasible substitute strategies by some strategy management techniques such as external factor evaluation matrix (EFE) and internal factor evaluation matrix (IFE). Step 2: By using and arranging the factors collected from the internal and external environment of the enterprise, putting forth feasible business strategies by using some tools such as SWOT matrix and SPACE matrix.