CAPSTONE PROJECT REPORT Building production and business strategy in Vinh Son – Song Hinh Hydropower Joint Stock Company in the period 2020 – 2025 ACKNOWLEDGMENT Group No.E03 class would like to give sincerely thanks for enthusiasism from teachers and trainees in Centre for Educational Technology and Career Development – Higher Education – Vietnam National University during the process of guiding us to complete graduation research paper. We also would like to give the best thankfulness to the Board of Director in Vinh Son – Song Hinh Hydro Electricity Joint - Stock Company and managers of Planing and Investment Department for enthusiasticly providing us very helpful information and data to finish our graduation research paper. Despite of trying our best in researching and collecting materials, our reaserch still has some mistakes because of limitation data and acknowledge. We really expect to receive the comments and guidance from teachers and colleguages to make this thesis more meaningful ENGAGEMENT Group No.E03 class assures that this is our own research: All statistics and data are honest and not stated in any other works of science.
Hanoi, 10 January 2010 Group leader Ho Sy B i LIST OF CONTENT LIST OF TABLES. x LIST OF CHARTS AND GRAPHS.xi LIST OF ABBREVIATIONS AND SIGNS. 1 CHAPTER 1: BASIC ARGUMENTS OF THE RESEARCH. Bussness strategy and the process to build business strategy for the enterprise:.
The arguments of strategy:. Characteristics of strategy:. All kinds of business strategy:. Classify business strategy basing on strategy levels:.
Classify business strategy basing on contents:. Classify business strategy basing overall process:. The importance of strategies in modern economy:. Contents of strategy development process:.
Define missions and targets of the company:. Define missions of the company:. Define the strategic target:. Analyzing the business environment of the enterprise:.
External factor effects on the enterprise:. Evaluation of effects from the external factor:. Internal enterprise analysis:. Analyse value series of the organization:.
Analyse the company’s culture and the reputation:. Evaluation of effects from the internal factor:.4 Business strategy choice. Product specialization strategy:. Integration growth strategy (link):.
Diversification growth strategy:. Build business unit strategy:.30 CHAPTER 2: ANALYSIS OF PRODUCTION AND BUSINESS OPERATION IN VINH SON – SONG HINH HYDRPOWER JOIN STOCK COMPANY. General introduction of Vinh Son - Song Hinh hydropower joint stock company (VSH):. Foundation of VSH:.
Main features of the company affect the construction of strategic plans:.1 Characteristics of organization:.2 Characteristics of the company’s capital:. Analysis of real situation of strategic building and strategic thoughts formed in VSH:.1 Defining customer’s need and build plan:. Setting up basics to build plans:.3 Defining and quantifying norms:. Evaluate the situation of building strategy in VSH:.
Shortcomings at VSH:. Analyse effect of environment impact to VSH:. Macro economy analysis:. Analysis of demonstration environment:.
Internally competitive pressure:. Competitive pressure from potential competitors:. Pressure from buyer:. Pressure from suppliers:.3 Internal analysis in VSH:.1 String value of VSH:.2 VSH’s financial situation:.
Evaluate effect of external and internal environmental impact to VSH:. Evaluate effect of external environmental (EFE matrix):. Evaluate effect of internal environmental (IFE matrix):.53 CHAPTER 3: BUILDING PRODUCTION AND BUSINESS STRATEGY IN VINH SON – SONG HINH HYDROPOWER JOIN STOCK COMPANY IN THE PERIOD OF 2010 TO 2015. Determine the mission and strategic goals of the company:.
The strategic objectives of the company:. Short-term objectives:. Long-term objectives:. Choose the business strategy for VSH:.
The strategies implementation solutions:. The leading cost strategy implementation solutions:. Solutions for production management:. The centralize strategy implement solutions group:.
Promoting the new construction of new hydroelectric plants:. Solutions for personnel and labor:. Creating corporate culture environment supporting the implementation of strategies:. Strengthen of administration changes in the strategy implementation:.
For the Government, Ministries:. For the provincial People's Committee of Gia Lai, Kon Tum, Quang Ngai, Binh Dinh, Phu Yen:. 75 v LIST OF TABLES Table 1.3: Table of changing integration growth strategy.2: Results of electricity production.3: Summarization of the company’s implementation capitals.4: VSH’s capital and asset structure.7: VSH’s capital cycle.10: Compared to its compititors.11: EFE matrix of VSH.12: IFE matrix of VSH.T matrix of VSH.2: GREAT matrix of VSH. 59 vi LIST OF CHARTS AND GRAPHS Figure 1.1: Chart of forming business strategy process.3: Model of five competitive forces given by M.4: Value series of the organization.1: Structure of organization and management system.2: The process of building strategic plan in VSH.37 vii LIST OF ABBREVIATIONS AND SIGNS EVN - Vietnam electricity Corporation Vinh son – Song Hinh Hydropower Joint VSH - Stock Company GDP - Gross Domestic Products KV - Kilovolt KWh - Kilowatt per hour MW - Megawatt MWh - Megawatt per hour viii Forewords FOREWORDS Topic: Building production and business strategy in Vinh Son - Song Hinh hydropower Joint Stock company in the period from 2010 to 2015.
Necessity of topic research: Over the past few years, besides advantages and new opportunities; enterprises in every economic sector in the country have been facing with many challenges and difficulties that is the economic growth year on year increases but not sustainable. The market is constantly changing and exporting market for some kinds of commodities and services now are being narrowed, particularly in the context of global economy recession. Meanwhile, integration into international economy and regions have been more and more expanded, and the nation has become official member of WTO, so it must be put under the pressure of competition more fiercely in the global world, regional market, and internally. In the context of fierce competition of economy, a company which wants to get success needs to be flexible with changes of the environment.
The enterprise is sure to know what they are doing. What will they do? In addition, if they do like that, what are the results? To answer these questions it is required to have certain knowledge not by judging their own feelings. Many Vietnamese enterprises now facing with a problem that they are not flexible with changes of the market, they are unflecxible, and they do not have the outlook for the distant future. Why do foreign enterprises have such kind of flexibility in business? The answer is that when foreign enterprises joining a new market they always build themselves a certain strategy.
Due to above reasons, building business strategies is very essential to Vietnamese enterprises. Research purposes: 1 Forewords The topic studied to build a business purpose in the enterprise major in hydropower. Then give some solutions and orientations to develop productivity and trading to year 2015 in Vinh Son - Song Hinh Hydopower joint Stock Company. Hydropower production is the main deal of industry Vinh Son Song Hinh Hydropower Joint Stock Company, so building production strategy in long-term development is vital to its survival.
Scope and object to research: The topic focuses on doing research and providing some guidelines to build production business and trading strategy in Vinh Son Song Hinh Hydropower Company. Research methodology: The method applying here is quantitive method, detailed as follow: - Specialist; - Analysis – comparison; - Statistics and economic analysis; Collect data from yearly reports, financial reports, and public media means, social – economic development plan of the local areas, of the industry and of the government. We use PEST analysis models, analysis of the internal and external environment, period identification of market target and positioning and SWOT, GREAT matrices. Management tools: comparison, collection.
Topic structure: Except the forewords, conclusion and list of references, the content of topic includes three following chapters: - Chapter 1: Basic argument of the reaseach. - Chapter 2: Analysis of production and business operation in Vinh Son – Son Hinh Hydropower join stock company - Chapter 3: Building production and business trategy in Vinh Son – Son Hinh Hydropoewr join stock company in the period from 2010 to 2015 2 Chapter 1: Basic arguments of the research CHAPTER 1 BASIC ARGUMENTS OF THE RESEARCH 1. Bussness strategy and the process to build business strategy for the enterprise: 1. The arguments of strategy: The term strategy has a long history and it orginated from military field and from the ancient Greece.
The strategy was born and developed along with conquests of imperial countries and it was considered as the art of winning in the battle. The military origination of the strategy has been shown in its oldest definition: According to the dictionary of American cultural heritages, strategy has been defined as a “science and art of commanding military, it is applied to make master plans and carry out the big – scale campaigns”. And in the Larouse dictionary: “Strategy is the art of leading tools to get success”. In the economy field, after the Second World War, global economy has recovered rapidly, business environment have been changing so vigorously.
At that time, business operation had no longer been raggy, small-scale and manual production like they used to be. The second revolution of science and technologies have promoted industrialisation and modernization process more strongly, competition more fiercely. That situation has forced companies to have long-term business production and operation. This requirement matches the nature of strategy definition from military field applying into the economy.
Over the periods of development, strategy definition has some certain changes and not come to agreement, therefore remains many different definitions. Based on traditional point of view, strategy definition understands as follows: “Strategy is the study of finding a suitable position to compete in the industry, a scope of operation where competitive activities occur”. 3 Chapter 1: Basic arguments of the research According to Micheal Porter, strategy is to emphasise competition. According to Alfred Chandler a professor at Havard University: “Strategy is to define the basic long term goal of the enterprise and operation programme and to arrange necessary resources to achieve those goals”.
However, Jame Quinn at Darmouth University defines: “Strategy is a model or plan of the enterprise to combine main goals, policies and operation order in one unity”.Gluek’s definition is that: “Strategy is a united plan, comprehensive, and designed to ensure basic goals of the enterprise successful”. We can recognize that in traditional definitions, the content and plan are still two important parts. Besides, those definitions imply that strategy of the enterprise is always the results from pre-estimated and predicted plans. At the beginning, those definitions got approvals from scientists and managers.
However, business environment have changed more quickly and complicated, it makes building strategy become much more difficult. Building strategy basing on plans is not suitable anymore. Because the reality proves that sometimes several plans have been official built not successful, so having solutions in business operation is very necessary. Thus, traditional definitions remain shortcomings.
The nature of strategy is a science and art to achieve not being asserted. At that time, definitions that are more modern have gradually replaced traditional ones. Modern definitions try to back with the nature of strategy term and at the same time it can adapt with business environment now are changing. Therefore, modern definitions do not emphasise on estimation and planning but on selecting the most suitable strategy in line with given goals.
It is clear that to have a more simple definition of strategy is a matter of difficulty. However, it can be solved if we study every factor of strategy; those factors have covering value to any enterprise. Now matter what it goes, those factors closely depends on the situation of each enterprise, and its staffs and organizational structure. To confirm a common definition of strategy, it should be necessary to view strategy definition separately from forming strategy process.
At 4 Chapter 1: Basic arguments of the research first, suppose that the strategy includes all-important operations of an enterprise. Suppose that the strategy have the characteristics of unity, target, orientation, and it can respond to changes of the environment. Characteristics of strategy: We have seen that, recently, those definitions of strategy have not united and changed along with the movement the economy, strategic idea is always changing to ensure its suitability with business environment.