GRIGGS UNVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CAPSTONE PROJECT REPORT THE GENERAL DEVELOPING STRATERY FOR VICOSTONE IN PERIOD OF 2012 - 2013 VIETNAM MARKET PENETRATION STRATEGY OF ARTIFICIAL STONE PRODUCTS OF VINACONEX ADVANCED COMPOUND STONE JOINT STOCK COMPANY (VICOSTONE) Group number: 2 Student’s name: Nguyen Viet Dung Nguyen Chu Son Nguyen Trung Dung Doan Ngoc Dung CLASS: GaMBA01.N06 HANOI, 2011 TABLE OF CONTENTS Table of content.I List of charts. ii List of figures.iii List of tables. 1 CHAPTER I: THREORICAL FOUNDATION OF MARKET PENETRATION STRATEGY. Some concepts and definitions related to strategy.
Process of building strategy. The analytical models used to build strategy. The models analyzing the factors outside the Enterprise. Internal Factors Evaluation matrix (IFE).
TOWS matrix model.6 Quantitative strategic planning matrix model (QSPM). The types of strategy for a Company. Corporate-level strategy. Business-level strategy.
Functional of departmental-level strategy.12 CHAPTER II: ANALYZING THE SITUATION OF VINACONEX ADVANCED COMPOUND STONE JOINT STOCK COMPANY (VICOSTONE). Overview of Vinaconex advanced compound stone joint-stock Company. Mission, vision, strategy. Field of activities, technologies, products.
The important milestones. Analyzing the status of Vinaconex advanced compound stone joint-stock Company. The common conditions in Vietnam. Business development in advanced stone products.
Factors inside the Enterprise. Strengths, Weaknesses, Opportunities and Threats of business.374 CHAPTER III: PROPOSE STRATEGY AND SOLUTIONS TO IMPLEMENT STRATEGY FOR ARTIFICIAL STONE PRODUCT-LINE OF VINACONEX ADVANCED COMPOUD STONE JOINT STOCK COMPANY. Developing direction of Vicostone. Analysis of strategies and decisions to choose strategy for Vicostone.
The strategies can be implemented by Vicostone. Selecting the main strategy for Vicostone. Propose some measures to implement after choosing strategy for Vicostone. Solutions in technology, research and development.
Human resource orientation. Solutions in the process of managerial organizing and production. Propose roadmap for implementing strategy of Vicostone. 543 REFERENCES APPENDIX LIST OF CHART Chart 2.1: Organization chart of Vicostone.297 LIST OF FIGURES Figure 1.1: Product Life Cycle.2: Example of EFE matrix.3: Example of IFE matrix.6: Quantitative strategic planning matrix model .1: The process of producing artificial stone.2: Value of total assets over years.3: Charter capital and Equity over years.4: Revenue, pretax profit, after tax profit over years.1: Vector built from SPACE matrix of Vicostone.2: The implementation roadmap for Vicostone.52 LIST OF TABLES Table 2.1: Average per capita income for years.2: Percentage of urban population of region for years.3: Situation of business result of Vinanvico in 2010.4: EFE matrix of Vicostone Company.5: The labor structure of Vicostone.6: Average income for years.7: Value of assets at the end of 2010.8: The basic financial indicators over years.9: Estimated profit distribution of the parent Company in 2010.10: IFE matrix of Vicostone.11: SWOT matrix of Vicostone.1: Build the TOWS matrix.4: The implementation roadmap for Vicostone.51 INTRODUCTION The existence of stable and sustainable development is always a top concern for every business.
In the context of competition and globalization are increasingly fierce as today, businesses need to take clear and solid steps to ensure the success achieved in the market. Strategic management is an important key to help the corporate determine the most appropriate way to develop. Therefore, the understanding of the principles and how to conduct strategic management in forming policy for the business is very important. Vinaconex Advanced Compound Stone Joint-stock Company (abbreviated name is Vicostone) is an enterprise specializing in producing advanced artificial stone for export.
Therefore, for companies, Vietnam market is a market with great potential but to being ignored. Vicostone is planning to research in order to develop the brand and Vicostone’s products in Vietnam market. Based on the needs of Vicostone, the group has conducted to research topic of building "Vietnam market penetration strategy of artificial stone products of Vinaconex Advanced Compound Stone Joint-stock Company (Vicostone)“The general developing strategy for Vicostone in period of 2012-2013”". The purposes of the research team to implement the project are: • Giving a number of methods and models used for building strategy for a business • Analyzing and evaluating the operation status of Vicostone with artificial stone products manufactured by company.
• Proposing strategies and solutions needed to help Vicostone bring advanced artificial stone products gradually to penetrate Vietnam market. 1 Object of the research is Vinaconex Advanced Compound Stone Joint-stock Company (Vicostone) with artificial stone products manufactured by using advanced Composite materials. Currently this product is provided in the world market by the company. However, the domestic market is of great potential to being ignored.
In that context, the building a strategy to penetrate Vietnam market is an appropriate decision. Based on the data collected within the scope of research, project mainly gives the comment and assessment, forming market penetration strategy of advanced stone products of Vicostone in period of 2012 - 2013. The research is based on the theoretical basis of the Marketing subject, human resources management and especially based on the theory of Strategic Management. In addition to some traditional methods of research such as synthesis, comparison and analysis on the basis of data collected, the authors use some methodological characteristics of strategic management as a model SWOT analysis, TOWS, PEST, QSPM.
and many some other models. Besides an introduction, conclusion, appendices, tables, table abbreviations, the capstone project report is presented in 03 chapters Chapter I: Theoretical foundation of market penetration strategy Chapter II: Situation analysis of factors and features works from the inside and outside of Vicostone. Chapter III: Strategy options for Vicostone and measures to implement that strategy. Our group would like to send sincere thanks and deep gratitude to the teachers of training program of Master of Business Administration GaMBA - Grigss University organized by ETC - Hanoi National University.
Additionally, our group would also like to thank the whole class, management board of class GaMBA01.N06, who has many comments and are dedicated to helping groups do this research. 2 CHAPTER I: THEORETICAL FOUNDATION OF MARKET PENETRATION STRATEGY 1. Some concepts and definitions related to strategy Before conducting a deep understanding of strategic management, we need to learn some basic concepts related to strategy and strategic management. What is Strategy? According to the slide lecture, the strategy is "a complex series of actions to mobilize as many the resources as an organization / individual can to achieve a specific purpose." According to Fred R.
David, the strategy is "the means to achieve long- term goals. What is strategic management? According to Fred R. David, that is "an art and science establishment, implementation and evaluation of decisions related functions allowing an organization to achieve these goals. Strategists, who are they? The strategy builders may be strategic executive directors, president, owner, chief financial officer.
or some companies have titles of chief strategy officers. They are responsible for developing strategies for the organization. Objective: according to Fred R.David, that is “the determined achievements which an organization finds the way to obtain while pursuing its main mission” [VIE 1, page. Policy is the guidelines for making decisions and demonstrate the situations are often repeated or cyclical situations"[VIE 1, page.
Vision: can be understood as the picture that the organization wants to reach and achieve in the future. We can see the desire and motivation of corporate activity based on the vision. Opportunity is a condition in the general environment that if a company knows how to exploit, it will achieve strategic competitive advantage. 3 Challenge is a common environmental condition which can interfere with a company in the process of gaining a strategic competitive advantage.
Process of building strategy Strategic management process includes the following stages of implementation: + Analysis of the organization (including external and internal) and building strategy. + Implementing the strategies outlined + Reviewing implementation of strategy and controlling system to make necessary adjustments 1. The analytical models used to build strategy 1. The models analyzing the factors outside the enterprise 1.
P-E-S-T Model Models PEST (Political Factors - Economic Factors – Socio-cultural Factors - Technological Factors) is a model to study the effect of macroeconomic factors to business and industry activities. These are factors outside the direct impact to the business: politics - law, economy, socio - culture and technology. Political - law factors: These are laws and rules in the legal framework that organizations must comply. The laws as law on enterprise, investment law, labor law.
and the tax policy, import and export policies, trade, support. will affect the operations of the business. Economic factors are the elements of the current state of the economy. This includes factors such as interest rates, inflation, recession, growth rate, GDP per capita.
These factors will impact the business strategy. Social - cultural factors are the demographic elements such as population, average lifespan, population distribution, education. or are the elements of the customs, practices, lifestyle, trends, social movements. It helps to distinguish and identify customer groups which are suitable with products and services of enterprise.
4 Technological factors: today manufacturing sector has been growing thanks to technological development. Therefore, the technological environment in each country is favorable condition for development. Policies to promote research and application of science and technology will be the motivation to manufacture more goods of higher quality.2 Product life circle model Figure 1. 1 Product Life Cycle [Eng 2] In this model, there are four stages in the lifecycle of a product: Introduction, Growth, maturity and decline which any product has to go through.
Characteristics of each stage as follows: Introduction: This is the initial stage of the product. Products are new to the market. Consumers are unfamiliar with the existence of them. Reasonable strategy for this stage is that the manufacturer should focus on researching products to meet consumer tastes, concentrating on production and branding.
Growth: This is a period of strong growth of the product. For this stage, it is necessary to promote the expansion of production in order to capture as much market share as possible, because in this stage, other competitors also begin to seeing the attractiveness of the market and join. This is the stage in which the demand is greater than the supply. 5 Maturity: the saturation stage is the stage where the number of products provided in the market is extremely abundant.
Prices tend to decline and the market is in favor of the demand, it means that the profit per product will slow down and tend to decrease. The strategy of this phase is to research to add value or different values for the product to compete. Decline: This is the recession stage of the product. Product is no longer attractive and the profit per product falls fast.
Feasible strategy is that the manufacturer needs to focus on research and bring new products to start a new cycle. Manufacturers have two trends either to develop product to a new step or conduct descending scale and phase out products from the market. The model of the product lifecycle helps manufacturers have strategies which are reasonable in their operation strategy in each stage of production from which it can help maximize profits and reduce risks in production activities 1. Porter’s five forces This is a famous and effective model first launched by Michael Porter in 1979 to provide a method to understand the factors that help companies make a profit.
Additionally, the model also provides the identification of strategies to help business grow. The power of suppliers: Any enterprises also have their own suppliers. The number of providers will decide to competitive pressure and power of negotiation between enterprises and suppliers. If the market has few suppliers but they have large scale, it would cause competitive pressure.
The suppliers of this type have more power to negotiate with the business. Conversely, if there are many providers, the power of negotiation shall be in favor of business. The power of customers: Any businesses have consumers. This is a competitive pressure which can directly affect the business.
Customers can be divided into two 6 categories: retail customers and distributors. Customers cause pressure on prices, quality products and services. They are the people who make purchase decision.