GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CAPSTONE PROJECT REPORT DEVELOPING BUSINESS STRATEGIES FOR DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 Group 9 - Class Gamba01. Le Anh Tuan 2. Tran Thanh Phong 3. Nguyen The Vinh 4.
Hoang Ngoc Dung HA NOI 2011 1 /63 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 LIST OF TABLES AND FIGURES. Reasons for selecting the research. Research subject and scope. Structure of the capstone project:.
7 RATIONALE FOUNDATION FOR DEVELOPING. Business strategy concept. The roles of business strategy:. Strategy classification according to strategic level.
Process of developing business strategy. Business goals and missions.2 External environment analysis. Analysis of internal business environment. Strategic analysis models.
Generic competitive strategies. Cost leadership strategy. Product differentiation strategy:. Selection of strategies.21 CURRENT BUSINESS SITUATIONS.21 OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY.
Overview of the company. The process of establishment and development. Business activities, objectives and scopes. The company’s structure:.
Business environment analysis.Group9 1 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 2.1 Influence of political and legal factors. Influence of economic factors.3 Influence of cultural and socio – demographic factors. Influence of technological factor. Influence of geographical and natural conditions.
Porter’s Five Forces). The external factor evaluation matrix of DTC:. Internal factor evaluation. Management and operations capability.
The Internal factor evaluation matrix of DTC. The SWOT matrix of DTC. The Quantitative Strategic Planning Matrix of DTC. 49 PROPOSED BUSINESS STRATEGIES AND IMPLEMENTATION SOLUTIONS FOR DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY (PERIOD 2011-2015).
Selecting business strategies for the period of 2011 - 2015.Group9 2 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 3. Solutions for human resource issues. Solutions for human resource development. The solutions for production management.
Solutions for equipment:. Solutions for finance:. Solutions for evaluation. Implementation progress of the company’s strategies from 2011 to 2015.
61 LIST OF TABLES AND FIGURES Figure 1.David’s Model of Strategic Management Figure 1.2 Michael Porter’s Five Forces Model Table 1.1 EFE Matrix Table 1.2 IFE Matrix Figure 1.2 The process of developing EFE and IFE matrices Table 1.3 SWOT Matrix Figure 2.1 The organizational Chart of DTC Table 2.1 Competitive Profile Matrix Table 2.2 The external factor evaluation matrix of DTC Table 2.3 Company’s financial effectiveness Table 2.4 Equipment and machines of DTC Table 2.5 Completed construction projects over the past 3 years.6 Currently implementing projects Table 2.7 The internal factor evaluation matrix of DTC Table 2.8 The SWOT Matrix of DTC Table 2.8 The QSPM of DTC V0110.Group9 3 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 DEVELOPING BUSINESS STRATEGIES FOR DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 INTRODUCTION 1. Reasons for selecting the research The transition of our country’s economy to market mechanisms has made businesses polarize with increasingly fierce and more intense competition. To survive and develop, the businesses need to define for themselves a sound strategy because if they have no strategy or wrong ones, they will surely fail. The activities of businesses in the market economy are investing and using resources to compete with rivals over the market demand.
The purpose of businesses in the market economy is achieving the highest efficiency for the long term period. The performance of the businesses is the relatively compared results between the benefits derived from business activities and the resources mobilized for such benefits. For businesses, creating a suitable strategy has special importance; the strategy direction and timely adjustment are the basis bringing huge benefits for the companies. In the context of market globalization, ever-changing technology, and increasingly fierce competition, strategy plays a more-than-ever critical role.
Together with the rising scarcity of resources, demand and consumer tastes always change, making the business environment become more complex and contain many risks. To survive and thrive, every enterprise needs to build a strategy. Every organization needs to have plan and strategy is a special plan. For businesses, strategic planning is the first function in the management system to achieve the organization’s goals.
The strategic planning has to take into consideration many external and internal factors, logically analyses the information to set the basis for planning business activities in short and long terms, concentrates all the efforts and resources V0110.Group9 4 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 on main objectives efficiently, reacts to unexpected situations and adapts to changes. DTC Construction Consultancy J.C is a unit on construction consultancy. In the first years of operations, the company has met many advantages as well as disadvantages and has received some achievements up to now. As proven by the reality, if a proper strategy isn’t created, the business can easily plunge into traps, leading to business decline and even bankruptcy.
Therefore, to stand firmly on the market and adapt to continuous changes in the business environment, the company is required to build itself an appropriate development strategy. Starting from the importance of building a business strategy and the needs of DTC Construction Consultancy J.C in strategic planning, we, Group 9 – Gamba01.V0110 Class, researched and chose the topic “Building strategy for DTC Construction Consultancy J.C”, with the desire to along with the company develop a proper strategy for the next period and the future as well. Research objectives To streamline the learnt knowledge and apply it into the reality of the chosen business DTC Construction Consultancy J.C, then, analyze and build a development strategy with solutions applied into practice, leading to the efficiency for the company, contributing to the socio-economic development in the province specifically and the whole country in general. Research subject and scope Applying the theories and methodology of the business strategy, the report shows the arguments to develop strategy for DTC Construction Consultancy J.C - Research subject: the research goes in depth in analyzing, evaluating and providing strategy direction for the Company based on the general theories of building business strategy.
- Research scope: Theoretical issues of business strategy, bases for developing business strategy, building strategy for the Company in short and long terms and specific solutions, measures to implement the strategy.Group9 5 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 4. Research methodology The study bases on the dialectical materialism philosophy and the learnt knowledge to evaluate the whole process of business activities of DTC Construction Consultancy J. Besides, the study uses methods such as: statistical, synthesis, analysis, comparison, modeling, forecasting, to analyze, assess and make the Company’s strategies. Structure of the capstone project: In addition to the appendices, introduction, conclusion and list of references, this report includes three following chapters: Chapter 1: Rationale foundation for developing business strategy Chapter 2: Current business situations of DTC Construction Consultancy J.C Chapter 3: Proposed business strategies and implementation solutions for DTC Construction Consultancy J.Group9 6 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 CHAPTER I RATIONALE FOUNDATION FOR DEVELOPING BUSINESS STRATEGY 1.
Business strategy concept Strategy is an overall action plan to achieve specific objectives. Referring to the strategy of an organization, people often think of how that organization define the objectives to reach, how to do it and what resources must be ensured. According to Fred R. David in his book “Concept of strategic management”, strategy is the means to achieve the long term objectives.
Business strategies can include the development in terms of geography, activity diversification, possession, and product development, market access, spending cuts, liquidation and joint ventures. The strategy is also understood to be a set of goals and policies as well as the plans to achieve those goals. It shows what business activities that the company is doing and will do, and which business field it will belong to. Besides, the business strategy or competitive strategy can also be defined: - Product market: Company’s business opportunities depend on its products, markets it serves, the competitors that it can confront or avoid and its integration extent.
- Investment level: Company should choose among many options: invest broadly or focused in the product markets, invest to maintain the current status, divest to withdraw or liquidate to dissolve the business. - Functional strategy: competition strategy can involve one or more following functions: product strategy, positioning strategy, pricing strategy, distribution strategy, production strategy, information and technology strategy, segmentation strategy, globalization strategy. - Strategic asset and capabilities: Strategic capabilities are the outstanding aspects of the company. Strategic assets are the resource strength compared to others’.
When building the strategy, the company should pay attention to costs as well as the V0110.Group9 7 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 ability to build/ maintain assets and capabilities, creating the sustainable competitive advantage of the business. - Resource allocation: financial and non-financial resources such as workshops, equipment, and human resource…all have to be allocated. Allocation decision is critical to the strategy. - Business synergy effect: only firms achieve the synergy effect can outperform the firms that ignore or not exploit this effect.
Overall, strategy is a set of actions and decisions that are closely related to each other in order to help the organization reach the objectives. It needs to be built in a way of making use of basic strengths, including resources and capabilities of the organization, as well as considering the opportunities and threats of the environment. Business strategy is considered as a principle in business. Therefore, if companies want to succeed in the business, a prerequisite that they must have is strategy and a good implementation of it.
The roles of business strategy: As the market economy changes all the time, the companies wanting to survive and thrive have to adapt to those changes - Planning role: Business strategy helps the company find the purpose and direction. It shows to the managers which direction to determine and when the desired results are realized. - Forecasting role: in a changing environment, any chances and threats occur. Strategy planning process helps the managers analyze the environment to make forecasts and come up with suitable strategies.
Therefore, the managers can better grasp the opportunities, taking advantage of them and reducing the risks associated with the environment. - Controlling role: Business strategy helps managers to use and allocate resources optimally as well as coordinate effectively functions in the organization to reach the common goals.Group9 8 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 1. Strategy classification according to strategic level When classifying the strategy according to the strategic levels, we normally have: - Corporate level strategy (or general strategy): created for every business fields that the company is currently in. The objective in this strategy is identifying the destination that the company wants to reach as a whole as well as the directions and measures to achieve that target.
- Business level strategy (field): created for narrow and specialized business field. In case that the company is only in one field, the business level strategy is also the corporate level one. Process of developing business strategy Strategic Management Process is summarized by the following model: Figure 1.David’s Model of Strategic Management 1. Business goals and missions Mission is a statement with a long term nature of purpose which differentiates a company from another.
Such claims can also be considered as a firm’s statement of business philosophy, business rules, and the company’s belief. All of those V0110.Group9 9 DEVELOPING BUSINESS STRATEGIES OF DTC CONSTRUCTION CONSULTANCY JOINT STOCK COMPANY IN THE PERIOD OF 2011- 2015 identify the business areas of the company, specifically the core products and services, the target customers, market demand, technology, to the combination of these fields. Mission is like the company’s publicly stated desired achievements, an image that the company wants to reach.