GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CAPSTONE PROJECT REPORT BUILDING BUSINESS STRATEGY OF SAO VANG RUBBER JOIN STOCK COMPANY PERIOD 2011-2015 Group No: 02 Student Name: 1. Pham Tuan Anh 2. Ngo Xuan Ty 3. Nguyen Thi Anh Nguyet 4.
Bui Duy Quang 5. Nguyen Huu Nhan Hanoi, 2011 Capstone Project - GaMBA01.X0409 - Group 02 2 Capstone Project - GaMBA01.X0409 - Group 02 COMMITMENT We commit that the content of this capstone project has not yet been submitted to any master program as well as any other academic program. We also commit that this capstone project is the effort and hard working of the members of our group. The analysis, findings, conclusion in this capstone project (apart from the reference) is all done by our own work.
GROUP MEMBERS SIGNATURE i Capstone Project - GaMBA01.X0409 - Group 02 ACKNOWLEDGEMENT We would like to express our sincere thankfulness to the Educational Technology & Career Development Center of Hanoi National University, the managers and the staff who have created the program and supported us since the beginning to the finishing of the program at GaMBA01. We sincerely thank to the teachers of GaMBA program who have taught, created the conditions so that we have been enjoyed the good learning environment. With the well organizing of the program, we have learned academic knowledge as well as practical method to apply that knowledge to our business. We are grateful to the Sao Vang Joint Stock Company.
The company has strongly supported us with the data, survey of realistic situation so that we have completed this capstone project. Last but not least, we highly esteemed the encouragement and the sharing of our families and classmates who gave us invisible but essential support in our studying. Many thanks! ii Capstone Project - GaMBA01.X0409 - Group 02 CONTENT ACKNOWLEDGEMENT.ii LIST OF ABBREVIATION. The Necessary of the Project.
The Objective of Research. The Scope of Research. The Methodology of Research. Capstone Project Structure.4 THEORETICAL BASIS OF BUILDING STRATEGY.
DEFINITION OF STRATEGY AND ROLE OF BUSINESS STRATEGY. Definition of Business Strategy. The Role of Business Strategy in Operating and Doing Business of Enterprises5 1. THE PROCESS OF BUILDING BUSINESS STRATEGY.
Analyze the External and Internal Business Environment of Enterprises. The Matrix to Select Business Strategy.1 External Factor Evaluation Matrix - EFE.2 Internal Factor Evaluation Matrix - IFE. IDENTIFYING THE BUSINESS STRATEGY. The Business Strategy.
20 SAO VANG RUBBER JOINT STOCK COMPANY (SRC) ANALYIS. OVERVIEW OF SAO VANG RUBBER JOINT STOCK COMPANY. The Company Profile. Vision and Mission of the company.
External Environment Analysis. Build up the Matrix for Strategy Analysis.58 Use the Mc. Kinsey matrix method to identify the position of the company as follow:. SWOT matrix for SRC.
62 iii Capstone Project - GaMBA01.X0409 - Group 02 BUILDING BUSINESS STRATEGY FOR COMPANY IN THE FOLLWING YEARS AND THE IMPLEMENTING SOLUTIONS. IDENTIFY COMPANY TARGETS IN THE FOLLOWING YEARS AND VISION TO 2020. The Basis to Identify Targets and Vision for SRC. Company Targets in the Period 2011- 2015.
Identify the vision for Sao Vang Rubber Joint Stock Company up to 2020. BUILDING THE BUSINESS STRATEGY FOR SRC 2011-2015. The business Strategies of company. Business Strategy Selection and Implementation Timeline.
SOLUTIONS TO IMPLEMENT THE STRATEGY. SOME PROPOSED COMMENTS. Proposed comments to SRC. Proposed Comments to the Government.
86 iv Capstone Project - GaMBA01.X0409 - Group 02 LIST OF ABBREVIATION SRC: Sao Vang Rubber Joint Stock Company DRC: Danang Rubber Company CSM: Southern Rubber Company VAMA: Organization of automobile makers of Vietnam GDP: Gross domestic product ROS: Return on sales ROA: Return on assets ROE: Return on equity IE Internal – External Matrix IFE Internal Factor Evaluation FDI Foreign Direct Investment v Capstone Project - GaMBA01.X0409 - Group 02 List of Tables and Figures Figure 1.2: Five Forces Model of Michael Porter. Porter Competitive Advantages Model.1: External Factor Evaluation Matrix.1: Organization structure of SRC.2: Economic Growth of Vietnam over years.2: Revenue in 2007, 2008, 2009 and 2010.38 of SRC, DRC and CSM.4: Main financial ratios of rubber companies over 2007-2009.38 The key performance indicators of the company in recent years.1: Operation Result of the Company.5: Fixed Assets of SCR over recent years.6: Human resource status of company in recent years.7: Assets and capital structure of company.8: Main financial indicators.9: External factors evaluation matrix of SRC.10: Internal factors evaluation matrix of SRC.59 Evaluating the competitive position of the company.11: SWOT Matrix of SRC.1: Forecast the GDP of Vietnam, period 2011-2015.2: Revenue of SRC from 2000 to 2010.3: Establish the equation to forecast the revenue.4: Forecast SRC revenue according to the math model to 2015.5: Forecast the revenue up to 2015 for SRC.6: Forecast the profit level of SRC up to 2015.7: Main targets for SRC, period2011-2015.67 vi Capstone Project - GaMBA01. The Necessary of the Project In the market economy with the globalization trends nowadays, the priorities of the enterprises are enhancing the competitiveness of their products and maintaining as well as broadening the market share. In order to be successful, the task of planning, building and implementing the business development strategy is the top and inevitable task.
This will help the enterprise to catch the signals of the markets, control risks which determine the existence and development of that enterprise. Especially, in the severe competition period or the economy crisis period, the future of an enterprise totally depends on the fact that whether or not that enterprise has right business strategies. Nowadays, all most of the enterprises in the world are putting the task of building business strategies as the top priority. Sao Vang Rubber Joint Stock Company is the first company in the rubber industry of Vietnam.
After 50 years of development, the brand name of Sao Vang Rubber () has improved the confidence from the consumers all over the country. SRC is now one of three companies that have the biggest market share in the domestic market of rubber inner tubes, tires. However, in the market economy and rapid international integration as current status, especially after Vietnam joined WTO, the task of maintaining and broadening the domestic market share are facing many difficulties. The challenges come from direct domestic competitors and the high quality imported products which are gradually dominating the market.
Besides that, input material prices are increasing when Vietnam is implementing the policy of eliminating subsidy, gradually building the real market economy. To exist and develop, the Company needs an appropriate and long term strategy, so that the Company can face the changes in the current embedded threats – business environment. Because of the above reasons, Group 2 has chosen the capstone project named “BUILDING BUSINESS STRATEGY OF SAO VANG RUBBER JOIN STOCK 1 Capstone Project - GaMBA01.X0409 - Group 02 COMPANY PERIOD 2011-2015”. We are seeking the solutions for the most appropriate business strategy for Sao Vang Rubber Joint Stock Company in the 10 years period.
The Objective of Research Researching on this project has helped the group member understand the theoretical basis of building business strategy. The research also helped the group members the skills to implement the business strategy in Sao Vang Rubber Joint Stock Company. The research has helped SRC acknowledging the opportunities, threats, strengths and weaknesses and indentifying business strategy in the period of 2011-2015 and vision to 2020. The Scope of Research The scope of research is the business environment of Sao Vang Rubber Joint Stock Company in recent years.
The Methodology of Research The research used the following methods: Material dialectical and analytical method: analyze the data from financial reports, compare periods and integrate to give the comments. Method of analysis through matrix to assess the research results of business environment which helped the Company selects the strategy scientifically. Statistical method: research on tables, graphs, figures and numbers to get conclusions and trend to evaluate the operating status of the industry and the company. Capstone Project Structure Besides the introduction, conclusion, the project is divided into three chapters: Chapter 1: Theoretical basis of building business strategy Chapter 2: Business environment assessment of SRC 2 Capstone Project - GaMBA01.X0409 - Group 02 Chapter 3: Building business strategy for SRC in the following years and solutions to implement the strategy.
3 Capstone Project - GaMBA01.X0409 - Group 02 CHAPTER I THEORETICAL BASIS OF BUILDING STRATEGY 1. DEFINITION OF STRATEGY AND ROLE OF BUSINESS STRATEGY 1. Definition of Business Strategy The word “Strategy” has the Greek origin which is combined by 2 words “stratos” (military) and “agos” (leading, control) with the meaning to indicate the big and long term plans which base on the analysis of advantages and disadvantages of the enemy. This term firstly use in the military area.
Since then the term of “business strategy” has been used. According to traditional point of view, strategy is the task of identifying the main and long term objectives of an organization, and then identifying the detail action plans together with use the resources appropriately to reach the targets. Over many periods of development in academic area, the definition of strategy has changed many times and not come to the agreement yet. There are still many points of view about business strategy.
According to Michael E. Porter, “Strategy is the art of making competitive advantages” “Strategy is a type of comprehensive and general plan which is designed to ensure the achievements of organization’s objectives”, Gluecl Chandler is one of the first people to initiate strategic management theory which defines strategy as “Determining targets, basic long-term purpose of enterprise, the applying a sequence of actions as well as allocating necessary resource to complete these targets”. The text book of Strategic Management subject in the MBA program Griggs University defined: “Strategy is a range of sophisticated actions to mobilize resources that an organization may have in order to gain a certain goal”. 4 Capstone Project - GaMBA01.X0409 - Group 02 Within the traditional definition of strategy, the content of planning is taking a main position.
Furthermore, the traditional point of view about strategy has agreed that strategies of a company are always the result of a period of calculating and planning. In the modern point of view, strategy is considered a science, an art to identify and reach the targets of a company. The nature of a business strategy is expressed as the following characteristics: - Business strategy helps to identify clearly the main targets and the business orientation of the enterprises in each period. - The orientation characteristic of the strategy is to ensure the ongoing and firmly development of the enterprise in the changing business environment.
- Business strategy ensures mobilize and optimize the usage of company resources in the present and in the future; use the strengths and opportunities to get the competitive advantages. - Business strategy is continuously implemented throughout company business. - Business strategy always has the orientation of competing and winning in the market. - Business strategy is often built for long period of time, i.
The Role of Business Strategy in Operating and Doing Business of Enterprises Business strategy helps enterprises identifying the targets, path way in the future; become the guild lines for every activity of enterprises. Strategy is the tool which presents the integration of many long term objectives of organization, enterprise. Objectives of enterprises are the specific targets that enterprises want to achieve in their business. The job of making the targets be specific and documented through the strategy will help the members of 5 Capstone Project - GaMBA01.X0409 - Group 02 the organization, enterprise acknowledge clearly where to go and what need to be done.
Therefore, they can reach their targets easier. Strategy helps to achieve shorter objectives in the long term point of view. In the modern business environment, enterprises have to do business flexibly to adjust with the environment. However, the movement can destroy the long term development.
That is the strategy with the targets will bring to the managers and leaders a long term orientation.