X03 - Group 11 GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CLASS GaMBA01.X03 CAPSTONE PROJECT REPORT PROPOSAL ON DEVEPMENT STRATEGY FOR VMS MOBIFONE’S 3G SERVICE Group Number: Group 11 Student’s name: 1. Ngo Thi Huyen Linh 2. Nguyen Thi Tran Huong 3. Le Manh Hung 4.
Nguyen Thanh Huong 5. Pham Thu Trang Commitment HANOI 2010 GAMBA01.X03 - Group 11 We certify that the report is our group’s studies. Figure and results in the report are of credibility and from reliable sources. We also state that all analysis in the reports is ours basing on references and learned knowledge.
The analysis is not private statement of any one of the group as a staff member in the organization where he or she works. Hanoi, December 2010 GAMBA01.X03 - Group 11 Acknowledgements Our first sincere thanks will be extended to the University of Griggs in Vietnam, whose instruction are valuable to our report. Besides, we also would like to thank VMS Company for its whole-hearted support in provision of data, figure and days of working for company’s strategy development. Last but not least, our thanks also go to professors and doctors for their help, lectures on skills and business administration knowledge, especially valuable instruction from Dr Ngo Kim Thanh and Dr Sea Mc Gough for our fulfillment of the report.X03 - Group 11 TABLE OF CONTENTS Commitment ……………………………………………………………………………………….……ii Table of contents………………………………………………………………….iii List f Abbreviations……………………………………………………………….………ix List of Tables……….…x List of Figures, Graphs……………………………………………………………………….1 CHAPTER 1: THEORETICAL BASIS.
Main issues on strategy and business strategy. Concepts of strategy. Business strategy and selection of business strategy. Role of business strategy.
Process to develop strategy. Strategic task and vision. Analysis of external environment. Analysis of the company’s internal environment:.
Synthetic Matrix of SWOT.20 SUMMARY OF CHAPTER 1.23 CHAPTER 2: ANALYSIS OF FOUNDATION FOR THE DEVELOPMENT STRATEGY FOR VMS-MOBIFONE’S 3G SERVICE. Overview of VMS-Mobifone Company. The establishment and development process. The Company’s fields of production and business.
VMS- Mobifone’s organization structure. VMS’s service products. Company’s production and business results in recent years. VMS Mobifone’s development strategy in 2010 – 2015 and vision 2020.
The Company’s task and vision. Strategic goals to 2015 and 2020. VMS Mobifone’s business strategy for 3G service in 2010 – 2015. Overview of VMS’s 3G Service product.
VMS’s business goals of 3G services in 2010 – 2015. VMS Mobifone’s business strategy for 3G service in 2010-2015. VMS Company’s SWOT matrix.70 SUMMARY OF CHAPTER 2.77 CHAPTER 3: SOLUTION TO THE DEVELOPMENT OF VMS’S 3-G STRATEGY IN THE PERIOD OF 2010-2015. Solutions to successfully implement chosen strategies.
Sales promotion issues. Diversification of services and sales.X03 - Group 11 LIST OF ABBREVIATIONS 3G Third generation technology-3G BTS Base Transceiver Station BSC Base Station Subsystem CDMA Code Division Multiple Access EDGE Enhanced Data Rates for GSM Evolution GPRS General packet radio service GSM Global System for Mobile Communications MMS Multimedia message service TDMA Time division multiple access VMS Vietnam Mobile Telecom Services Company VNPT Vietnam post and telecommunication WCDMA CDMA broad band WiFi Wireless Fidelity 1 GAMBA01.X03 - Group 11 LIST OF TABLES Table Content Page 1-1 Analysis of macro environment 13 1-2 Matrix of SWOT 22 2-1 MobiFone’S Number of subscribers and market share 28 2-2 Mobifone’s turnover in 2003 – 2010 30 2-3 market share of mobile information subscribers till 48 September 2010 2-4 Rating of VMS’s competitive status against others 52 in the field of 3G service business 2-5 Making on priority ranking 61 2-6 Rating of VMS’S challenges 63 2-7 Similar services of 3 networks 65 2-8 EFE Matrix 66 2-9 VMS’s existing number of BSC, BTS stations 69 2-10 BTS investment in five forth coming years 69 2-11 IFE Matrix 71 2-12 VMS Company’s SWOT matrix 72 2-13 Analysis of QSPM matrix 75 3-1 Progress of implementation strategies 87 2 GAMBA01.X03 - Group 11 LIST OF FIGURES, GRAPHS Figure Content Page 1-1 Process to develop strategy 9 1-2 External environment 11 1-3 Model of Michael Porter’s 5 forces 15 1-4 Chart of Value String 18 2-1 VMS’s Organization map 26 2-2 Mobile information maket share in Vietnam (2005 – 28 2009) 2-3 List of 3G service and product 33 2-4 3G products and services for individual customers 34 2-5 3G services and products for enterprise customers 35 2-6 Knowledge on trademark of mobile information providers 37 2-7 Trademark and promotion 38 2-8 3G’s customer segment 39 2-9 Detailed customer segment of 3G service Figure 40 2-10 Provision route of 3-6 services and products 41 2-11 Analysis of 3G market in other countries 41 2-12 Chart of market share of mobile information subscribers till September 2010 49 3-1 The differences of 3G service provision 82 3-2 VMS’s strategy and initiative of 3G service sales 84 3-3 VMS’s network of sales and distribution in the future 84 3-4 Customers’ needs and place to access customers. 85 3-5 VMS 3G service turn over forecast 89 3 GAMBA01.X03 - Group 11 INTRODUCTION 1- Reason for subject selection. The development of business strategy for a product or service, in any company, is to orientate the product development in the future.
It is particularly important to set up a suitable business strategy in market mechanism, helping the company achieve its business development goals; the successful implementation of business strategic policy is a big help for the company’s sustainable development. In recent years, mobile phone market has been flourishing. There are 7 service providers in operation, some others are taking application procedures for entrance. However, the market is getting to saturated point.
Competition is becoming fierce. Growth of revenue, profit is weak. These urge companies to have new strategies for development. In this scene, 3G (a set of international telecommunication standards and technologies promoting mobile phone quality and efficiency) turns out to be a better solution for companies.
Vms-Mobifone is the first mobile information exploiter in Vietnam, fully operating on April 16th, 1993. In combination with its partner, Comvik International Vietnam AB of Swedish Kinnevik Corperation, VMS-MobiFone has invested 340 million US dollars in MobiFone’s mobile information system. Currently, VMS is one of the providers in Vietnam with a big market share as well as a pioneer company to implement the provision of 3-G service. To effectively carry out business activity requires a suitable business strategy to the company’s capacity and Vietnam’s market.
With desire to put the learned knowledge into practice in the companies where the authors are working, the thesis “Development of business strategy for VMS-MobiFone’s 3-G service in the period of 2020-2015” was chosen for the study. 2- Research purposes Researching and systematicalizing theories about building and implementing business strategy, selecting analysis models efficient to business strategy building and implementation.X03 - Group 11 Applying system of above theoretical basics and models for analysing and evaluating internal, external environments in order to build 3G business strategy for VMS-MobiFone. Recommending solutions, suggestions in business strategy implementation in order to complete VMS-MobiFone’s selected business strategy. 3- Scope of the study Due to time and resource limitations, our group only had deep research in analysing and building strategy of 3G business (one of VMS’s businesses) for the corporation phase 2010- 2015, the key period for development and success of the company’s 3G service.
4- Research methods To solve the above issue, the report mostly uses method of qualitive analysis (analysing facts of VMS-MobiFone Company). The specific methods of data collecting such as investigation sheet, expert interview have been used to collect data. Using national statistic records, professional information, data; using secondary data on strategy and researches, reports previously done by VMS-MobiFone company 5- Layout of the study To suit the aim of the study, the study, apart from the introduction and conclusion, is divided into 3 chapters as the following: Chapter I: Theoretical basis Concerning theoretical basis of business strategy such as: concepts, nature and basic features of strategy and business strategy, some of business external environment analysis models in building business strategy: 6 factors of external environment, 5 competition forces. Some models are used to analyse the company internally in building business strategy: model of value string, sustainable competition advantage, general model of internal and external environment analysis (SWOT).
Chapter II: Study of strategic management issues in the process of expansion and development of VMS-MobiFone’s 3-G service.X03 - Group 11 General introduction of VMS-MobiFone Company Models are applied to analyse the company’s internal and external environment. SWOT model is applied to generally evaluation finding the company’s strengths, weaknesses, opportunities and threats. Chapter III: Recommending 3G service business strategy for VMS-MobiFone in 2010 – 2015 period and implementation solutions General introduction of 3G, recommending 3G business strategy for VMS-MobiFone in 2010-2015 period and some solutions in order to implement successfully selected business strategy. Conclusion References 3 GAMBA01.X03 - Group 11 CHAPTER 1: THEORETICAL BASIS 1.
Main issues on strategy and business strategy Majority of world enterprises currently consider strategy development their top duty, especially in today’s severely competitive business environment. To survive and develop, each enterprise should be dynamic and creative to set up its own suitable business strategy. Methods and approaches are available to set up and select business strategy in accordance with the enterprise. The following is the introduction of theoretical method of developing and selecting business strategy for a product or service, the process and experience in strategy development in the world.
Concepts of strategy The term “strategy” originated from the art of warfare in old times. It is considered as the art of commanding means to win or reach one’s aims. Carl von Clausewizt, a 19th- century strategy researcher, said” Strategy is to making plan for warfare and plan strategic campaigns which determine the participation of each soldier”. Edward Mead Earle, a historian described: “Strategy is the art of controlling and using a nation’s resources to ensure and increase the effectiveness of one’s essential rights” The term of strategy is now used popularly and is regarded as the growing for companies’ business activities.
The concepts of strategy are of variety, such as, “strategy is modules of goals, purposes and plans to reach them” (Kenneth, 1965), or “strategy is the striking thread through out a company or organization’s activity” (Ansoff, 1965). Kenneth Andrew is the first to point out out-standing ideology in the book “The Concept of Corporrate Strategy”. In his view, strategy is what a company has to perform basing on its strengths and weaknesses in the scene of both opportunities and challenges. The formation of concepts and viewpoints has undergone the process of generalization of approaches, such as: - Classic view supposes that it is possible to plan long term competitive advantages; 4 GAMBA01.X03 - Group 11 - Evolution view sees a company as a living thing which will struggle and adjust to adapt to and survive competitive environments; - Process view stresses that the survival and development of a company is a process of experience accumulation, struggle by all means to reach the goals, and a strategy is needed to carry out the process; - Systematic view state that a company’s business activity must be done systematically to reach a long-term success.
The struggle and exchanges among those views gradually create new common views on strategy. No matter how it is approached, a company’s business strategy is characterized by 3 commonest features: - Setting up an overall action plans towards the future in terms of the company’s long- term business aims - Company owner will decide important policies and methods; - Setting up the steps, patterns and allocation of sources to carry out the company’s goals 1. Business strategy and selection of business strategy 1. Business strategy concepts The above analysis of concepts and views leads to the concept of business strategy that orientates targeted business activities in a long time together with a system of policies, measures and resources allocation to reach the company’s targets the same duration of time.
A company’s business strategy is a general action programme towards reaching its goals.