GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM STRATEGIC MANAGEMENT BUILDING BUSINESS STRATEGY FOR ADVANCE INTERNATIONAL JOINT STOCK COMPANY (AIC) IN 2012 -2016 PERIOD Group Number: 2 Students’ name: Nguyen Hung Cuong Nguyen Khanh Van Bui Huy Hoang Ho Ngoc Viet Vu Quang Hoang Anh HANOI 2011 CONFIRMATION OF ADVANCE INTERNATIONAL JOINT STOCK COMPANY (AIC) We, Advance International Joint Stock Company confirm that we the research group including the members mentioned below to be allowed to get access to the internal documents, data as well as contact with the operation fact to study about the strategic orientations of AIC, serving the research purpose of the group to complete the MBA course: 1. Nguyen Hung Cuong 2. Nguyen Khanh Van 3. Bui Huy Hoang 4.
Ho Duc Viet 5. Vu Quang Hoang Anh Hanoi, November 29, 2011 HEAD OF PROJECT MANAGEMENT -i- TABLE OF CONTENTS Acknowledgements.i Table of contents.ii List of figure and diagram. Reasons for choosing the research topic 2. The goals and scope of the study 3.
Realistic and scientific meanings of the research topic CHAPTER I: THEORETICAL FOUNDATION ABOUT SETTING UP BUSINESS STRATEGY. Concept and classification of business strategy. Concept of business strategy. Classification of business strategies.
Basing on strategic levels. Basing on the scope of the strategies. According to strategic approach. Business unit strategies.Porter’s competitive strategy.
Competitive strategies for business units according to their market share. Competitive strategies for business units challenging the market. Strategies for business units preceding the market. The steps involved in building business strategies.
Determine the duties or missions of the enterprise. Determine business targets. External and internal environment analysis. External environment analysis.
Internal environment analysis. Set up business strategies. Solutions to implement business strategies. Implement business strategies.
Analysis tools to set up business strategy. External factor evaluation matrix (EFE). Internal factor evaluation (IFE). Strategies from SWOT matrix.
Competitive profile matrix.16 CHAPTER II: BUSINESS ENVIRONMENT ANALYSIS OF AIC COMPANY 18 2. Overview of AIC. Establishment and development process of AIC JSC. The company’s medical wastewater treatment system.
AIC’s vision, mission and core value. Business environment analysis. Macro-environment analysis. Business environment analysis.
External factor evaluation matrix (EFE). Internal environment analysis of AIC Company. Internal environment analysis. Internal factor evaluation matrix (IFE).
Competitive profile matrix of AIC. Suggested strategic alternatives. 45 CHAPTER III: SELECTING STRATEGIC ALTERNATIVES AND SOLUTIONS. Objectives of AIC JSC up to 2016.
Bases for developing objectives. Objectives of AIC JSC up to 2016. Strategy selection of AIC. Solutions on strategy implementation.
Solutions on finance. Solutions on human resource. Solutions on marketing. Solution on overall management system.
Roadmap for strategy implementation. Recommendations to the Government. Recommendations to the Ministry of Health. 67 LIST OF FIGURE AND DIAGRAM Order Names Page Figure 1.1 PEST model 6 Figure 1.Porter’s 5 forces 10 LIST OF TABLES Order Names Page Table 1.1 External factor evaluation matrix EFE 12 Table 1.2 Internal factor evaluation matrix IFE 13 Table 1.3 SWOT matrix 13 Table 2.1 Comparison of the technology of medical wastewater 28 treatment system of AIC with other competitors’ Table 2.2 External factor evaluation matrix of AIC 30 Table 2.3 Statistics of the products’ quality of medical wastewater 33 business units.4 Internal factor evaluation matrix of AIC 35 Table 2.5 Revenue from business activities of AIC 36 Table 2.6 Product quality of come medical wastewater treatment 37 units Table 2.7 Internal Factor Evaluation Matrix (IFE) Matrix of AIC 39 Table 2.8 Competitive profile matrix of AIC 40 Table 2.9 SWOT matrix of AIC 42 Table 2.10 QSPM Matrix O-S strategies 45 Table 2.11 QSPM Matrix T-S strategies 47 Table 2.12 QSPM Matrix O – W strategies 48 Table 2.13 QSPM Matrix T – W strategies 50 Table 3.1 Phases to implement the strategies 62 INTRODUCTION 1.
Reasons for choosing the research topic: Economic globalization is the inevitable trend of the world today; it dominates all economies in the world. Vietnam’s membership of WTO has given many opportunities and challenges to Vietnam enterprises. Therefore, to stay firmly and develop well in this cutthroat competitive environment, Vietnam enterprises have to figure out right directions and business development strategy. In coming years, Vietnam economy starts to develop steadily and the people’s incomes increase higher.
The process of industrial activities has exhausted the natural resources, polluted the environment; consequently, the community’s living standards are degraded. Nowadays, medical wastewater treatment from hospitals is a matter of great concerns, which is thought to develop together with the economic development. Besides, this matter is a burning issue and receives a lot of concerns from State, Ministries and Branches. In the current situation, not only inhabitants, the Government but also hospitals themselves require a good medical wastewater treatment before recharging into general treatment systems in order to have no impacts on surrounding environment.
Currently, there are many organizations being in need of being supplied with medical wastewater treatment system; and also there are many divisions at home and abroad expecting to meet these demands. Advanced international joint stock company needs to have strategic orientation in attempt to stand firmly in supplying market of existing medical wastewater treatment technologies and products and have further development in the future. In order to make contribution to the development of Advanced International joint stock Company, we choose the topic: “Building business strategy of advanced international joint stock Company (AIC) in the 2012-2016 period. Target and scope of the research Target: The target of this topic is have comprehensive evaluation on business operation actuality of the Company and find out advantages and weaknesses, opportunities and threats in order to map out business strategy for the Company in the 2012-2016 period.
In terms of the research group, this is a chance to apply learned theories on strategic management in a specific situation in order to experience by themselves and improve their knowledge, benefit the current jobs of the author group Research scope: advanced international joint stock Company is known as a company operating in various fields such as labor export, real estate investment, fund management and selling commercial products. However, the research topic only focuses on the aspect of supplying technological products on medical wastewater treatment. Topic scope is building the theoretical basis on establishing the most basically business strategy for a company. Regarding advanced international joint stock Company (AIC), the topic puts the emphasis on analyzing some basic factors affecting the establishment of business strategy in order to build appropriate business strategy for the Company in the 2012-2016 periods about providing medical wastewater treatment technical products.
The topic’s content includes: Chapter 1: Theoretical basis on building business strategy: This chapter describes the concept on business strategy and the process of planning a business strategy. Chapter 2: Analysis on business environment of the Company: this part introduces the birth and development of company and major businesses. Moreover, it introduces visions, missions and core values of the Company; analyzes external and internal environment in order to find out opportunities, strengths and weaknesses to build strategic plans. Chapter 3: Selecting strategic projects and implementing solutions: this part describes target of the Company until 2016, the Company’s selection of business strategies in the 2010-2016 periods.
At the same time, it raises solutions to implement that strategy and some proposals to the Company and the Government. Research method This project focuses on researching, analyzing all information, secondary data of most fundamental contents through mass media and directly from internal divisions of advanced international joint stock Company. Research and establishment of matrixes on selecting strategies is carried out by specialized method referring to reference experts’ opinions specializing in products and business environment situation of medical wastewater treatment in Vietnam in order to set criteria and evaluation for those criteria. This method is easy to implement but the disadvantage is that the accuracy of this method is lower than that of real survey because its results come from subjective opinions of experts.
However, this method’s effectiveness is good enough for building a feasible business strategy. Scientific and practical meaning of research topic Scientific meaning: In market economy, business strategies play a decisive role in the success of company. It is not only important to one specific company but also all companies. In order to survive and develop in the market economy, it is a priority to have effective business strategy.
There are different approaches to build a business strategy for a company. The important meaning of this topic is collecting theories from various sources so as to map out the process of building business strategy basically and it must be easy to understand and implement. Practical meaning: Business strategic establishment process is applied to build business strategy in the field of providing products of health waste water treatment for advanced international joint stock Company (AIC)- a medium and small- sized company, mainly operating in terms of commerce, providing technological products on environmental treatment, in the 2012-2016 periods. Therefore, research and proposal of this business strategy for AIC Company is able to be applied for same size companies in commercial field.
CHAPTER I: THEORETICAL FOUNDATIONS ABOUT SETTING UP BUSINESS STRATEGY 1. Concept and classification of business strategy: 1. Concept of business strategy: “Strategy”, a word of military origin, derives from a Greek word “Strategos”. According to military theorist Clawzevit, military strategy is the art of commanding in upper hand position.
Strategy is the art of distributing and applying military means to gain the victory. Today, strategy term is used in many various fields of the society; especially in economic field. According to Fred R.David, strategy is means to obtain long-term goals; Johnson and Scholes re-defined the strategy in the conditions of the environment with a lot of speedy changes: “Strategy is the direction and scope of an organization over the long-term: which achieves advantages for the organization through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholders expectations”. Similarly, there are many more definitions.
In short, strategy is the planning of orientation and ways to obtain the planned targets. Business strategy: Bruce Henderson, a strategist cum the founder of Boston Consulting Groups said that “strategy is a deliberate search for a plan of action that will develop a business competitive advantage and compound it. However, the difference between the competitors and you is the foundation of your advantages”. Professor Alfred Chandler, Harvard University, said: “Business is the determination of the basic, long-term goals and objectives of an enterprise; and the adoption of courses of action and the allocation of resources necessary for those goals”.
In today’s competitive environment, it can be said that business strategy is create competitive advantages for the purpose of obtaining business targets in the best ways. Classify business strategies: 1. Basing on strategic levels: Corporate strategy: Is the overall strategy of the organization aiming at obtaining its goals. Business level strategy: Refers to the aggregated strategies of a strategic business unit in the organization, each strategic business unit will make their efforts to obtain their goals and the overall of these units will help obtain the goals of the whole organization.
Functional strategy: This base on the functions of the organization such as financial strategies, human resource strategy, marketing strategies… 1. Basing on the scope of the strategies: Generic strategy or so-called the corporate strategy which mentions to the most important matters that cover the whole of the organization and have long-term meanings, can possibly decide the life or death of the organization. Functional strategy: is the secondary strategy such as marketing strategy, financial strategy, price strategies, distribution strategy… Generic strategy (or corporate strategy) and functional strategy link closely together to create a complete business strategy.