CAPSTONE PROJECT REPORT BUILDING BUSINESS STRATEGY FOR VIETNAM JOINT STOCK COMMERCIAL BANK FOR INDUSTRY AND TRADE - HA TINH BRANCH IN 2011-2015 PERIOD Group: 13 1. Nguyen Tien Phuong - Group leader 2. Hoang Van Thieu - Member 3. Hoang Thi Tam - Member 4.
Nguyen Kim Hung - Member CLASS: GAMBA01.V03 Nghe An 2011 1 VIET NAM JOINT STOCK COMMERCIAL BANK FOR INDUSTRY AND TRADE HA TINH BRANCH Date April 2rd ,2011 To Whom it may concern Subject: Comments of Vietnam joint stock commercial Bank for industry and trade Ha Tinh Branch on the project of Group 13, Gamba 01.V03 Class – Griggs University 1. The students have closedly followed up the current situation of thi organization structure and thi business activities of Vietinbank Ha Tinh to implement the project 2. The content of Building business strategy for Vietnam joint stock commercial Bank for industry and trade Ha Tinh Branch in 2011 – 2015 period 3. The content of the project is excellent Hoang Viet Ngai Chairman Vietinbank Ha Tinh 2 COMMITMENT We, the research Group 13, would like to commit that this Capstone project report is wn research which is accomplished thanks to various sources of documents and real situation.
The Capstone project report is not copied from any other available thesis. We undertake any legal responsibilities for the contents contained within this thesis. ACKNOWLEDGEMENT Business strategy planning enables a company to effectively take use of its business opportunities and strengths. At the same time, it helps to restrict the threats than can be badly affected to the company.
In addition, strategy planning also brings about the conection and association among business environment and enterprise. This cohensive relation is the foundation for the goals and strategies that the company plans to set in the future. For gaining such research results, we would like to express our sincerely gratitude for the support of Griggs University, ETC Center an especially the lecturers who have enthusiastically taught, guided and provided us with the valuable knowledge. Our sincere thanks would also come to the support and assistance of the leaders and colleagues in Vietinbank Ha Tinh.
They have spent their highly valuable time on discussing with us for relation between the topic contents and practical situation ant the company helping to create a close connection between theory and practice and resulting in a highly feasibility in the future. We, the Group 13, would like to receive the continual support of the lecturers and our colleagues to help us completing the the course with highest results. 3 Table of contents Content Page CHAPTER I BASIC ISSUES RELATED TO BUILDING BUSINESS STRATEGY FOR BANK 1. Concept and characteristics of business strategy for bank 1.
Concept of business strategy 1.2 Characteristics of business strategy for bank 1.3 Role of business strategy for bank 1.4 Types of business strategy 1.1 Concentrated growth strategy 1. Basic competition strategies 1. Process of building business strategy 1. Determining mission and goal 1.
Analyzing external environment 1. Analyzing internal environment of the enterprise 1. Techniques of analyzing and selecting strategy 1.1 External factor evaluation matrix 1.2 Internal factor evaluation matrix 1.3 Competitive profile matrix 1. Characteristics of trading banking services CHAPTER II REAL SITUATION OF BUSINESS ENVIRONMENT OF VIETINBANK HA TINH 2.
Overview of Vietnam Joint Stock Commercial Bank for Industry and Trade – Ha Tinh Branch 2.2 Function, mission and business activity of Vietinbank Ha Tinh 2. Products and services 4 2. Organizational structure of Vietinbank Ha Tinh 2. Analyzing business environment of Vietinbank Ha Tinh 2.
Analyzing macro-environment 2. Socio-cultural factors 2. Political-legal factors 2. Analyzing micro-environment 2.
Analyzing existing competitors 2. Analyzing bargaining power of buyers 2. Analyzing bargaining power of suppliers 2. Analyzing threat of new entrants 2.
Analyzing threat of substitute products 2.3 Evaluating opportunities and threats 2. External factor evaluation (EFE) matrix 2. Analyzing internal factors of Vietinbank Ha Tinh 2. Analyzing human resources 2.
Analyzing marketing capacity 2. Analyzing capacity and organizational level 2. Analyzing financial capacity 2. Analyzing information system 2.
Analyzing business lines of Vietinbank Ha Tinh 2.1 Analyzing capital mobilization activity 2.2 Analyzing credit activity 2. Evaluating strengths and weaknesses 2. Internal factor evaluation (IFE) matrix CHAPTER III SELECTING BUSINESS STRATEGY FOR VIETINBANK HA TINH IN 2011- 2015 PERIOD 5 3.1 Selecting strategic plan 3.2 Content of business strategy for Vietinbank Ha Tinh in 2011-2015 period 3.1 Common business goal 3.2 Content of business strategy for Vietinbank Ha Tinh in 2011-2015 period 3. Solutions to implement business strategy for Vietinbank Ha Tinh 3.
Solution on training and developing human resources 3. Solution on marketing 3. Solution on technology 3.4 Solution on restructuring business activity of Vietinbank Ha Tinh 3.5 Solution on raising supervisory capacity and developing products 3. Roadmap for implementing strategy 3.2 Network development strategy 3.2 Product development strategy 3.2 Network development strategy 3.2 Product development strategy 3.3 Network development strategy 3.1 Recommendations for Vietnam Joint Stock Commercial Bank for Industry and Trade 6 3.6 Conclusion LIST OF ABBREVIATIONS Abbreviations English Vietnamese Joint Stock Commercial Bank for Ngân hàng thương mại cổ phần ngoại VCB Foreign Trade of Vietnam thương Việt Nam Vietnam Bank for Agriculture Ngân hàng Nông nghiệp và phát triển AgriBank and Rural Development Nông thôn Bank for Investment and Ngân hàng Đầu tư và Phát triển Việt BIDV Development of Vietnam Nam Vietnam Joint Stock Commercial Ngân hàng TMCP Công thương Việt Vietinbank Ha Bank for Industry and Trade - Ha Nam – Chi nhánh Hà Tĩnh.
Tinh Tinh Branch Vietnam Joint Stock Commercial Ngân hàng TMCP Công thương Việt Vietinbank Bank for Industry and Trade - Nam Main Operation Center 7 LIST OF FIGURES AND TABLES Content Page Figure1. Mission of strategic management Figure 1. Process of building business strategy of enterprise Figure 1. External environment Figure 1.
SWOT analysis Figure 1. IE total weighted scores Figure 2. Market share of capital mobilization of Vietinbank Ha Tinh and other banks in the region in 2010 Figure 2. Market share of services of Vietinbank Ha Tinh and other banks in the region in 2010 Figure 2.
Structure of customers of Vietinbank Ha Tinh in 2010 Figure 2. Structure of human resources of Vietinbank Ha Tinh in 2010 Figure 2. Structure of human resources by experience in 2010 Figure 2. Capital mobilization structure of Vietinbank Ha Tinh compared to other banks in the region Figure 2.
Structure of outstanding loans of Vietinbank Ha Tinh and other banks in the region Figure 3.1 IE of Vietinbank Ha Tinh Table 2.1 The number of credit institutions in Ha Tinh as of December 31, 2010 Table 2. Operation network of credit institution in Ha Tinh as of December 31, 2010 Table 2. Affecting factors to customers’ selection of banks Table 2. Evaluation on competitiveness of Vietinbank Ha Tinh compared to other banks Table 2.
The number of customers of Vietinbank Ha Tinh in 2008-2010 Table 2. EFE matrix of Vietinbank Ha Tinh Table 2. The number of cadres of Vietinbank Ha Tinh in 2008-2010 Table 2. Total assets and mobilized capital in 2008-2010 Table 2.
Profit before tax of the Branch in 2008-2010 Table 2. Risk provision of the Branch in 2008-2010 Table 2. Capital mobilization and market share of capital mobilization of Vietinbank 8 Ha Tinh from 2007 to December 31, 2010 Table 2. Outstanding loans of Vietinbank Ha Tinh and other banks in the region from 2007 to December 31, 2010 Table 2.
Revenue from services of Vietinbank Ha Tinh from 2007 to December 31, 2010 Table 2. IFE matrix of Vietinbank Ha Tinh Table 3. SWOT matrix Table 3. Selected strategies Table 3.3 Main targets in 2011-2015 period Table 3.4 Projected business results in 2011-2015 period 9 PREFACE 1- The necessity of the study: Over the past years, Vietnam’s banking sector has attained important achievements, making contribution to the development of the country.
These gained achievements are thanks largely to the contribution of Vietnam commercial banks. The capacity to take advantage of opportunities and cope with challenges are the main factors for the existence and sustainable development of Vietnam commercial banks. In the following years, apart from the existing advantages, Vietnam commercial banks will have to face a lot of challenges, especially the competition among Vietnam commercial banks and more difficultly the competition with foreign commercial banks. In response to the real demand from business activities in the development and integration with the regional and the world economies, Vietnamese Government has made commitment with international financial institutions on opening the finance and banking market of Vietnam.
Competition and the world economic integration require commercial banks to have changes in terms of orientation to meet the demand of the new situation. In that context, commercial banks need to determine to develop into modern banks, keep the key role in monetary and financial market, become strong banks in the regions and be able to compete and quickly adapt to the integration and development process. To gain proactiveness in integration process, overcome challenges and make full use of opportunities, Vietnam commercial banks need to be able to analyze their strengths and weaknesses to work out appropriate strategies for each period and development stages to follow the current trend on the principle of ensuring the interests of the country and enterprises. In that general context, to survive and develop, Vietnam Joint Stock Commercial Banks – Ha Tinh Branch (Vietinbank Ha Tinh ) also needs to form and implement a new business strategy, especially paying attention to expanding operating scale, modernizing technologies, diversifying and raising the utilities of products and services based on 10 advanced technologies; reforming management and administration apparatus and managing the bank under the market thought; standardizing and turning into written form all the specialized process and risk management; renovating management, step-by-step establishing a prestigious bank in the region and in the world; having competitive capacity; operating effectively and safely; and having better capacity of mobilizing capital in the society and expanding investment to meet the demand of the industrialization and modernization of the country.
Successfully building and implementing business strategy are urgent requirements and missions to the existence and development of banks in general and Vietinbank Ha Tinh in particular. Form that reality, under the view of managers, the group has selected the topic “Building business strategy for Vietnam Joint Stock Commercial Bank – Ha Tinh Branch in 2011-2015 period” with the expectation to contribute to raising business performance and lifting Vietinbank Ha Tinh to a new position in the system of Vietinbank in particular and the system of Vietnam commercial banks in general. 2- Objective of the study Based on research methodology, the group has analyzed and generalized the basic theories on business strategy along with analyses and evaluation on real situation of Vietinbank Ha Tinh to build business strategy for Vietinbank Ha Tinh in 2011-2015 period and recommended some solutions to implement business strategy to make Vietinbank Ha Tinh become a strong branch in the system of Vietinbank and in Ha Tinh Province. - Clarifying basic theories on business strategy and process of building business strategies for banks.
- Evaluating the real business situation of Vietinbank Ha Tinh and affecting factors to business strategy of Vietinbank Ha Tinh. - Building business strategy for Vietinbank Ha Tinh in 2011-2015 period and recommending a number of solutions to implement the strategy. 3- Object and scope of the study 11 Identifying theoretical and practical issues in building business strategy at Vietinbank Ha Tinh in 2011-2015 period. The scope of the study is only restricted in business strategy for Vietinbank Ha Tinh in 2011-2015 period.
4- Methodology of the study - Methods of approach: The study uses the mix of approaches such as particular approach, historical approach, quantitative approach and qualitative approach. - Methods of processing and analyzing data: the study uses descriptive statistics, analysis and generalization when evaluating business performance of Vietinbank Ha Tinh; and uses some matrices like EFE, IFE, SWOT, and IE.