GRIGGS Business and production UNIVERSITY strategy construction for PVNC within the GLOBAL ADVANCED MASTER period of 2010OF BUSINESS ADMINISTRATION - 2015 PROGRAM CAPSTON PROJECT REPORT BUSINESS STRATEGY CONSTRUCTION FOR NGHE AN PETROVIETNAM CONSTRUCTION JOINT STOCK CORPORATION WITHIN THE PERIOD OF 2010-2015 Prepared by Group: 10 Class: Gamba 01. Phan Quốc Hùng 2. Nguyễn Đình Dũng 3. Tạ Quang Cảnh 4.
Lê Thị Vân Huyền Vinh 9/2011 Group 10 - Class: Gamba01.V0110 1 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 ABBREVIATION LIST. The necessary of the subject. Purposes of the study. Objects and scopes of the study.
Methods of the study. Structure of capston project report includes three chapters. 6 THEORITICAL BACKGROUND ON BUSINESS STRATEGY CONSTRUCTION. Concepts and role of business strategy.
Concepts of business strategy. Roles of business strategy for PVNC. Business strategy construction process for PVNC. Definition of PVNC vision, mission and targets.
External environment evaluation. Internal enviroment analysis. Models of strategic analysis. Selection of business strategy.
20 ANALYSIS OF BUSINESS ENVIRONMENT AND INTERNAL ENVIRONMENT OF PVNC. General introduction of PVNC:. Introduction of Nghean Petro Vietnam Construction Joint Stock Corporation. Situation and operating resuls from 2009 to 2011.
ANALYSIS OF PVNC BUSINESS PICTURE.Analysis of external environment. Analysis of internal environment. Matrix for selection of the strategy.42 CHƯƠNG 3: PROPOSAL AND CONCLUSION. Mission of the strategy.50 Group 10 - Class: Gamba01.V0110 2 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 3.
SOME SOLUTIONS AND PROPOSALS FOR PVNC EXECUTION OF BUSINESS STRATEGY. Construction of business strategy. Selection of business strategy. SOME SOLUTIONS FOR STRATEGY EXECUTION.
Solutions for products and services. Solutions for organizational structure and human resource development. Solutions for basic investment construction and machines, equipments capacity raising. Solutions for science and technology.
Solutions of effective capital mobilization and utilization.65 ABBREVIATION LIST Abbreviated Explanation names PVN PetroVietnam PVC PetroVietnam Construction Joint Stock corporation PVNC Nghe An PetroVietnam Construction Corporation UBND Provincial people’s committee BIDV Bank for Investment and Development of Viet Nam BCG (Boston Consulting Group) Group 10 - Class: Gamba01.V0110 3 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 McKinsey - GE Strategic matrix of MC.KINSEY - GE SXKD Production and business CBCNV Cadres, employees DT Revenue ĐTDH Long term investment ĐTNH Short term investment NH Short term DH Long term SWOT Strength (S), Weaknesses (W), Opportunities (O), Threats (T) TK Inventory TNDN Corporate income DT Revenue ROA Ratio of asset withdrawal ROE Ratio of contributed capital withdrawal HSEQ Management system of environmental safety and quality TS Asset TSCĐ Fixed asset TSLĐ Mobile asset PT Receivables HTK Inventory VCSH Owner capital TNHH Limited Liability Group 10 - Class: Gamba01.V0110 4 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 BUSINESS STRATEGY CONSTRUCTING FOR PVNC WITHIN THE PERIOD OF 2010-2015 ------------------------------------------------------- PREFACE 1. The necessity of the subject On integrating WTO, the competition among domestic and foreign enterprises is more and more violent. Existence and development in market mechanism is a big challenge for enterprise; to construct a sustainable developed enterprise then business strategy is a special plan that all enterprises must construct and define before going to operation. Most of Vietnamese enterprises were born in a focused planning economy which is promoted to accept the rule in changed and competitive global business environment.
Enterprises must find out the way to maintain the sustainable existence and development. Nghe An PetroVietnam Construction Corporation (PVNC) is one of company with prestige in and out of petroleum sector. The corporation has new force and position to occupy regional market. With diversified development of business sectors the enterprise has reached annual growth rate in term of output, revenue and annual profit equal to approximate 200%.
An enterprise has advantage of resources and brand name; but if annually it cannot construct a right business strategy then it will lack of competitiveness, then business effect will be low even leading to bankruptcy. Coping with above challenges as well as outstanding growth of PVNC to keep up with development route of enterprises in and out of petroleum sector, PVNC must quickly construct a suitable development strategy. From reality of business activities of PVNC, group 10 has decided to select the following topic “business strategy construction of PVNC within the period of 2010 – 2015”. Purposes of the study To analyze factors impacting on business activities of PVNC, then construct business strategy within the period of 2010-2015, and propose functional strategies and concrete solutions on strategy selection.
Object and scopes of the study Study object is PVNC which belongs to PVC with trading sectors of projects construction, property project investment. Methods of the study Study topic is done based on synthesizing qualitative study method such as observation, interview, group discussion then synthesize, analyze and compare primary and secondary data on business environment and operational situation of PVNC Secondary data is collected from: PVNC, PVC, PVN, Construction ministry, Planning and Investment Department, Nghe An statistical agency, papers and Internet; website of Nghe An petroleum. Group 10 - Class: Gamba01.V0110 5 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 Primary data is collected by exchanging, working and interviewing leading cadre in the corporation, information dissemination board of PVNC, financial board, planning economic board of PVNC. Structure of capston project report: 3 chapters Chapter 1: Theoritical background on business strategy construction Chapter 2: Analysis of business environment and internal environment of PVNC Chapter 3: business strategy selection for PVNC within the period of 2010 – 2015 and solutions for execution CHAPTER I: THEORITICAL BACKGROUND ON BUSINESS STRATEGY CONSTRUCTION 1.
Concepts and role of business strategy 1. Concepts of business strategy Business strategy is: The place where enterprise is trying to reach in long term Enterprise must compare within a certain market with business activities on such market. Enterprise must operate more effectively than competitive opponents on such markets. Resources (skill, asset, finance, relations, technical capacity, equipments) must be available to compete.
External environmental factors impact on competitiveness of enterprise. Which values and expectation do powerful individuals in and out of enterprise need? Strategy is widely used in many different sectors; in business sector, there are also many approaches of strategies. According to traditional approach, business strategy is considered as total long term of an organization to reach long term targets. Historic management researcher Alfred D.
Chandler supposed that “strategy is to define basic and long term targets of an enterprise and implement activities together with allocating necessary resources to reach such targets”. Then his thought has shown that strategy is a creative defining process, out of which Group 10 - Class: Gamba01.V0110 6 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 enterprise can choose its own targets, define action plan to well fulfill such targets and allocate equivalent resources. Traditional approach has the strength to help enterprises to easily imagine what to do to define strategy and realize the usefulness of strategy in term of long term plan. However, in a changed business environment we can realize the limitations of traditional approach because it cannot flexibly adapt to the change of business environment.
According to current approach, strategy can be larger than what enterprises expect or set up implementation plan. According to the viewpoint of Mintzberg, he supposed that strategy is a model in the flow of decisions and action plan. The model can be any kind of strategy: designed strategy or abnormal strategy. He has given the following model: Modern approach will help enterprise to easily cope with the changes of business environment and promote to predict of conditions for strategy implementation and evaluate values of abnormal strategy.
Via above approaches, we can understand that: business strategy of an enterprise is an art to construct long term targets and implementation policies to orient and create competitive advantage for enterprise. Business strategy is to analyze, learn to know and find out the basic method, think of development orbit in business and production which is the plan with comprehensiveness, coordination and consistency leading business unit to ensure its own target; business strategy is to define basic targets of business unit, select medium and action plan, allocate necessary resources to implement business targets. The term of strategy is used according to three popular meanings. Firstly, general action plans and main resources implementation for reaching given targets.
Secondly, target organizational programs; used resources to reach such targets, policies to manage income, using and arrangement of such resources. Thirdly, define long term targets and select operational method then allocate necessary resources to reach such given targets. The role of business strategy for PVNC In front of changed market, inflate situation has increased highly, administrators of PVNC needs a strategy to find out a right orientation which can help PVNC to overcome the market storm, go ahead to the future by its own effort then make use of available potentials and resources; business strategy is constructed to help PVNC to adapt effectively with the long term changes. Group 10 - Class: Gamba01.V0110 7 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 Strategic administration will help PVNC to be more active in defining future at the same time create influences in operational environment then it can make use of all capacity to monitor and adapt to all external changes.
Strategic administration will give cadres the realization of importance, leader and labors all understand and commit to implement enterprise’s targets. Then they will feel that they are a part of enterprise then they will commit to support and raise responsibility in all business and production activities. Business strategy construction process for PVNC 2. Define vision, mission and targets of PVNC Vision of PVNC: try to become a leading corporation of construction and investment within the Central area; such vision is considered as an operational guideline for the corporation in all times and backgrounds to develop in sustainable way.
Mission of PVNC is to provide the market with products and services of construction and investment in housings, industrial zones…which can satisfy customers. The targets of PVNC are to promote implementation progress of main projects; good contracting new projects; investment in short term projects to create growth rate in medium and long term; business sectors diversification to create more jobs for labors, social securities and profit maximizing for the enterprise to maintain annual growth rate from 130% - 200% in the period of strategy construction; create sustainable development for the company. External environmental evaluation for PVNC 2. Macro environment We must evaluate to see which external environmental factors impact on the enterprise? There are four main groups of factors which belong to macro environment that the enterprise must cope with: political factor; economic factor, social and cultural factor, technological factor.
As follows: GDP of Viet Nam in 2010 reached 6. Banking interest is increased together with the change of exchange rate, high material price and input human resource. Political environment is stable, legal system is improved to create good condition for business enterprises. Globalization process happens strongly worldwide.
However technological sector Group 10 - Class: Gamba01.V0110 8 /74 Business and production strategy construction for PVNC within the period of 2010 - 2015 in Viet Nam is still outdated. Natural environment also impacts on capacity of exploiting, using progress of machine and implementation progress. + Political and legal factors: those factors can impact on business activities of the enterprise; stable politics is defined as one of important premises for business activities of the enterprise; political and legal environment can impact on business effect of enterprise which can impact on products, business sectors…of the enterprise.