GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CAPSTONE PROJECT REPORT BUILDING THE BUSINESS STRATEGY FOR THANG LONG CONSTRUCTION CORPORATION PERIOD 2011-2015 Class: N03 HANOI 2010 TABLE OF CONTENT TABLE OF CONTENT. I LIST OF TABLES. IV LIST OF FIGURES AND CHARTS.1 CHAPTER 1: THEORETICAL BACK GROUND ON BUILDING BUSINESS STRATEGY FOR ENTERPRISES. Definitions on strategy.
Roles of strategy. Types of strategies. Business Strategic Planning Process. Defining the mission and key goals.
External Environment Analysis. Macro environment analysis. Industrial Environment Analysis. Internal environment analysis.
HR and organization elementsc:. Research and Development elements. Financial and Accounting elements. Production and Operation elements.
Marketing and distribution elements.Defining sustainable competitive advantage. Strategic analysis approaches. SWOT Analysis Matrix. Generic business strategy.
Types of Generic Strategies. Cost Leadership Strategy. A Combination of Generic Strategies. GREAT model - Selecting the optimum strategy.
Strategy Implementation and Adjustment. Designing the control system.32 CHAPTER 2: ANALYSIS ON THE BUSINESS STRATEGY OF THANG LONG CONSTRUCTION CORPORATION. Overview of Thang Long Construction Company. Foundation and Development.
Product and Market. Out put - Revenue. Evaluation of some other business and production effectiveness ratios. Analysis on opportunities and challenges of Thang long Construction Corporation.
Macro environment analysis. Cultural and Social environment. Political and legal environment. Industry environment analysis.
Analysis on competitors. Threats of new entrants. Threats of Suppliers. Threats of Substitutes.
Opportunities and Challenges. Analysis on strengths and weaknesses of Thang long Construction. Human resource management. Human resource organization and management:.
Analysis on financial resource. Analysis on the capacity of technology and equipment. Marketing and PR activity. Management Capacity Analysis.
Evaluate the strengths and weaknesses of Thang Long Corporation 67 2.1 Main strengths of Thang Long Corporation. Main weaknesses of Corporation. Defining Corporation’s competition advantages. Environment analysis synthesis and matrix.2 IE matrix for External and Internal Analysis.72 CHAPTER 3 : STRATEGY PROPOSAL AND STRATEGY IMPLEMENTING SOLUTIONS IN THE PERIOD 2011-2015.
Mission vision and general objectives. Strategy proposals and suitable strategy selection. Preferential strategy selection under the model GREAT. Solution for technology.Solution for human force.
Solution for finance:. Solutions for Marketing and market. Strategy implementing plan and requirements. Improving organizational structure and controlling evaluation.
Improving organizational structure. Improving evaluation control system.85 III LIST OF TABLES Table 1.1: Synthesis on macro environment factors.2: The process of recognizing the sustainable competitve advantage.3: Simplified SWOT analysis Frame.1: Production and Business Outcomes.2 :External Factors Evaluation (EFE).3: Forecast on the total demand for traffic construction to 2015.4: Financial Statement of Corporations in 2009.5: Product and Business Outcomes of Corporation 2009.6 The Qualification structure of indirect staffs.7: The proportion of machineries and technology.8: Synthesis of opportunities and Challenges.9: Human resource structure of the corporation.10: Evaluation on the strengths and weaknesses of human resources.11 – Financial ratios over 3 years: 2007, 2008, 2009.12 : Equipment and Manchinery structure of Thang Long Corporation.13 :Internal Factors Evaluation Matrix (IFE).14: Correlated Comparison with competitors.15: SWOT matrix analysis.16 : SWOT analysis synthesis.1 : OPTIMAL STRATEGY SELECTION – MODEL GREAT.2: Selected detail implementation plan.80 IV LIST OF FIGURES AND CHARTS Figure 1.1: Business Strategic Planning Process.Porter Five Forces Model.6: Porter's Generic Strategies.1: Functional structure in Cost Leadership Strategy.2: Functional structure in Differentiation Strategy.7 : Strategy Implementation Activities.1: Organizational Structure of Thang Long Construction Corporation. Rationale Since Vietnam’s WTO integration few years ago, the national economy is on transition to the market economy. Besides the domestic competition, it appears also the market penetration and domination by the foreign enterprises.
That’s why enterprises witnessed the more polarization and tougher competition. For survival, development and strong position of their own brand, enterprises need to define a right strategy, because with a wrong strategy, enterprises must suffer from dreadful consequences. Strategic planning should be based on external objective and internal subjective elements, a systematic analysis in short – term and long-term, the most effective focus all the efforts and resources in major targets, reactions to unstable circumstances and adaptation to changes. As the leading enterprise in building bridge, tunnel (guaranteed by products which are used and account for a big proportion compared to other enterprises in the same industry.
However, looking back at the progress, behind the successes and profits, the corporation still bares much limitation. It can not benefit its strengths to overcome industrial competitors. The business outcomes are not worthy for the available resources and the spearing industry where the company is operating. After WTO entry, in the trends of integration, cooperation and competition with domestic, regional and International Corporation within the industry, the competitive advantage of the spearing industry (bridge and tunnel) of the corporation become more than ever fragile while the other players are collecting and developing the same strengths with the corporation.
In such a context, searching and building a stable solution, a development strategy for Thang Long construction Corporation are really essential. An effective development strategy will not only bring about the stable development and benefits for the corporation, but also go along with the governmental development strategy on converting this corporation into the group model, a core player of the national economy. 1 In the light of that, Group 3 chose the topic of : “Building the business strategy for Thang Long Construction Corporation period 2011-2015" with an important significance for Thang Long Construction Corporation in particular and construction industry in general. Research Object and Scope Object: To analyze the business environment of Thang Long Construction Corporation in order to build up a business strategy for this company period 2011- 2015.
Scope: Theoretical background on enterprise business strategy and its application to building business strategy for the corporation in coming years. On the other hand, because construction is the core business of this corporation, the research will cover only business strategy of its construction business. This report will use following research methods: Synthesis method; Analysis method; List and comparative method; Expertise method; 4. Expected outcomes - Analysis and evaluation on the impacts of external as well as internal elements of the Thang Long Construction Corporation.
- A proposal on a suitable business strategy and some implementation solutions in order to improve the competitive position, promote the business effectiveness for Thang Long Construction Corporation period 2011-2015 5. Report structure Chapter1:Theoretical background on building business strategy for enterprises Chapter2: Analysis of The Thang Long Construction Corporation’s strategy Chapter 3: Business Strategy Proposal and some implementation solutions period 2011- 2015 2 CHAPTER 1: THEORETICAL BACK GROUND ON BUILDING BUSINESS STRATEGY FOR ENTERPRISES 1. Definitions on strategy Strategy: Each researcher has his own opinions, views and remarks on strategy. Here below, we mention a definition of strategy: Quinn1 define strategy as an illustration or plan which integrates key objectives, policies and chain of activities in a whole tight composition.Gluek defined strategy precisely as: “A unified, comprehensive and integrated plan designed to assure that the basic objectives of the enterprise are achieved”.
The three adjectives, which Glueck has used to define a plan, make the definition quite adequate. ‘Unified’ means that the plan joins all the parts of an enterprise together; ‘comprehensive’ means it covers all the major aspects of the enterprise, and ‘integrated’ means that all parts of the plan are compatible with each other. Besides, the business strategy of competitive strategy can be defined with 6 following factors: product market, investment, functional strategy, strategy assets, strategy capacity, resources allocation, impacts of internal agreement. Development strategy of enterprises: “a range of commitments and actions which are conducted by the enterprises in order to gain a competitive advantage from core competence on a decisive market » In summary, strategy is an orientation and scope of an organization in long term in order to gain the competitive advantage for institution by defining all resources in a changing environment to meet the market demand and satisfy expectations of relate parties.
Roles of strategy - Create the relation between strengths and weakness of the company, the mutual supporting relation between opportunities and challenges outside the company, and then create the competitive advantage for enterprise. 3 - Help the manager to see the opportunities and threats that may happen in current and future business in order to make analysis and forecast the future market, take full advantage of opportunities, reduce the threats, improve the competitiveness of enterprise, and achieve great success. - Help the enterprises to create better business strategy via using systematic approach, creating base for and increase the connection among internal members in realizing the common target of the enterprise. Types of strategies.
- Classification by strategy level: +/ Corporate strategy (General strategy refers to the overarching strategy of the diversified firm. Such a corporate strategy answers the questions of "which businesses should we be in?" and "how does being in these businesses create synergy and/or add to the competitive advantage of the corporation as a whole?" +/Business strategy (sector): Business strategy refers to the aggregated strategies of single business firm or a strategic business unit (SBU) in a diversified corporation +/ Functional Strategy: include marketing strategies, new product development strategies, human resource strategies, financial strategies, legal strategies, supply- chain strategies, and information technology management strategies. - Classification by the strategy content. Regarding the strategy content, the managers can define strategy in different types: +/ Marketing, commercial strategy +/ Financial Strategy +/ HR Strategy +/ Technology Strategy - Classification by the development stages: By this strategies can fall into 02 types: +/ Orientation strategy: mentioning the overall orientation on goals of the enterprise.
It is built on the basis of environment analysis and internal analysis of the enterprise 4 +/ Operation strategy: all the action plans for enterprise in a real context and forecast on strategy adjustments. Business Strategic Planning Process. Before, the decision on business strategy was done only one for a long time, and it’s job of the high rank managers. Nowaday, the business strategic planning is regular task which requires the involvement of all enterpirse memebers.
It includes following steps.1: Business Strategic Planning Process (Management of strategy, Statistics publisher in 2009) 1. Defining the mission and key goals - Defining the organizational mission: 5 While a business must continually adapt to its competitive environment, there are certain core ideals that remain relatively steady and provide guidance in the process of strategic decision-making. These unchanging ideals form the business vision and are expressed in the company mission statement. The mission statement communicates the firm's core ideology and visionary goals, generally consisting of the following three components: 1.
Core values to which the firm is committed 2. Core purpose of the firm 3. Visionary goals the firm will pursue to fulfill its mission - Defining the strategic goals: In strategic planning all parts of the process are important, but perhaps the most important part involves developing your strategic, corporate goals, objectives and business goals. Much of the analysis you do in strategic planning is designed to help you develop achievable goals that reflect the business realities in your sector and environment.
External Environment Analysis An analysis of the external environment is an attempt to understand the forces outside organizational boundaries that are helping to shape the organization 1. Macro environment analysis PEST analysis is a technique used to identify, assess and evaluate external factors affecting the performance of an organization. A PEST analysis is undertaken to help an organization gain an understanding of the wider business environment and may be carried out as part of an ongoing process of environmental analysis or scanning. The aim is to provide information to assist those responsible for strategy development and decision making.
PEST analysis may be used in the context of overall organizational strategy or more specifically to evaluate the feasibility of a new product or service, or expansion into a new market. 6 To facilitate the analysis, environmental scanning has traditionally focused on four types of factors which may have an impact on the success of an organization: political, economic, social (or sociological) and technological factors. These four areas form a simple framework for the analysis, although it should be borne in mind that there will be varying degrees of overlap and interrelation between them.