2011 | GLOBAL ADVANCED MBA PROGRAM (X0110) | Group No.: 09 CAPSTONE PROJECT REPORT BUILDING THE CORPORATE STRATEGY OF GIA TRINH (In 2011-2016 period and Vision to 2020) Vu Cuong Hoang Thi Hanh Hoang Thi Hien Le Huu Vinh Class: GaMBA01.X0110 HANOI 2011 GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CAPSTONE PROJECT REPORT BUILDINH THE CORPORATE STRATEGY OF GIA TRINH (In 2011-2016 period and Vision to 2020) Group Number: 09 Student's name: Vu Cuong Hoang Thi Hanh Hoang Thi Hien Le Huu Vinh HANOI 2011 TABLE OF CONTENTS CHAPTER I: THEORETICAL BASIC .1 Concept of strategy.1 Concept of strategy .2 Comprehensive Model of the Strategic Management Process and Alternative Strategies.2 Analyze the actual situation of company.1 Analyze the external environment.2 Analyze the internal environment.3 The Strategy – Formulation Analytical Framwork - 3 Stages. 06 CHAPTER II: ANALYZE THE ACTUAL SITUATION OF GIA TRINH COMPANY .1 Overview of Gia Trinh company.1 The History and Development of Gia Trinh Company.2 Summary results of operations and business of Gia Trinh Company in three years: 2008, 2009, 2010.2 Analyze the business environment and the actual situation of Gia Trinh.1 Analyze the external environment that affect Gia Trinh Company.1 The PEST Model – Analyze macro environment.2 Poter’s Five Forces Model – Analyze the environment of industry (Competitive Analysis).2 Analyze the internal environment for Gia Trinh Company.5 Research and Devlopment .6 The information system .3 Stage 1 of The Strategy – Formulation Analytical Framwork for Gia Trinh: The Input Stage.1 Building the External Factor Evaluation Matrix that affect Gia Trinh Company – EFE Matrix.2 Building the Internal Factor Evaluation Matrix for Gia Trinh Company – IFE Matrix. 32 CHAPTER III: SOLUTIONS, RECOMMENDATIONS AND CONCLUSIONS.1 Vision, goals, mission and core values of Gia Trinh Company.2 Stage 2 of The Strategy – Formulation Analytical Framwork for Gia Trinh Company: The Matching Stage.1 Building the SWOT Matrix for Gia Trịnh Company.2 Reveal the feasible alternative Strategies of Gia Trịnh Company.3 Stage 3 of The Strategy – Formulation Analytical Framwork for Gia Trinh Company: The Decision Stage.1 Building the Quantitative Strategic Planning Matrix (QSPM) for Gia Trịnh Company.2 Determine the relative attractiveness of feasible alternative Strategies of Gia Trịnh Company.1 Rebuilding the company's organizational model consistent with the strategic choice.2 Recommendations on research and development activities.3 Recommendations on the management of production and product quality.4 Recommendation for Marketing activities.5 Recommendations on the financing. 53 LIST OF TABLES.1: List of particular business strategies.1: Results of operation and business of Gia Trinh Company .2: Revenue structure, pasty products of Gia Trinh Company.3: The structure of consumers of Gia Trinh.4: Inflation rate of Vietnam.5: Competitive Profile Matrix.6: The personnel structure in Gia Trinh company.7: Some important financial targets in Gia Trinh.8: The production process of Gia Trinh Company.9: Gia Trinh’s External Factor Evaluation Matrix (EFE Matrix).10: Gia Trinh’s Internal Factor Evaluation Matrix (IFE Matrix).1: SWOT Matrix forms alternative strategies for Gia Trinh.2: Quantitative strategic planning matrix (QSPM) for Gia Trinh.
43 LIST OF FIGURES.1: A comprehensive strategic management Model.2: Relationship between Key External Forces and organizations.4: Model of Michael Porter’s five competitive forces.5: Analytical framework to form strategy.1: Organizational structure of Gia Trinh Company.2: GDP growth rate of Vietnam. 14 INTRODUCTION Recently, many reputable scholars in the world have given lectures on the issues of economic management in Vietnam. Of these, the most remarkable ones are Professor Michael E. Porter, who advised Vietnam: “With the strength of agriculture, Vietnam may be the food supplier for global markets”.
Philip Kotler, who gave advice that Vietnam should be “the kitchen of the world”. Standing on the national level, this is a problem that still needs discussing more. However, to agriculture and agricultural products, this is the great advantages of advertisement for those who grasp opportunities, entrepreneurs in this field. Trung Nguyen is a brand of well-known agricultural products of Vietnam.
From a heart full of strong desire, from scratch, Mr. Dang Le Nguyen Vu and colleagues have developed Vietnamese coffee brand No.1 in Vietnam and gradually conquered the world market. Initially this brand achieved much success. (Trung Nguyen has more than 500 major distributors and transferring-business contacts in many countries such as USA, Russia, Canada, Japan, China, Singapore, etc.
Professor Tim Larimer of Columbia University – USA used to consider Trung Nguyen as Starbucks in Vietnam)1.2 Pho 24 is a big brand in Vietnam cuisine. Pho noodle is a traditional dish of Vietnam. Pho is often regarded as a popular dish in sidewalk but was built to a famous fast food brand by Mr. Ly Quy Trung with modern business methods.
Ly Quy Trung is having a dream oF building Pho 24 to have truly “confrontation” with global food like KFC, Mc Donald.vn Gia Trinh is a small pastry company, holding many secrets of making cakes and traditional dishes of the capital, thousands of years of civilization. Wishing to build Gia Trinh become a trademark food, which can compete with other brands and take Gia Trinh to the world step by step, by knowledge gained from GLOBAL ADVANCED MBA PROGRAM by GRIGGS UNIVERSITY cooperated with ETC training, the authors decided to choose the topic “Building business strategy for Gia Trinh Company, period 2011-2016 – vision to 2020”. This study aims to build an effective business strategy for Gia Trinh company with the goal of bringing Gia Trinh to become a strong brand in the domestic market, reach to the global. Starting from the current capacity of Gia Trinh, take advantage of the opportunities of domestic and overseas business environments, with the motto: Big dream - small step by step, using scientific methods, such as: theoretical study and analysis of primary data, secondary data, expert methods, methods of comparison, and this research has high ability of applying to Gia Trinh.
The structure consists of three main chapters: Chapter 1: Theoretical Basic Chapter 2: Analyze the actual situation of Gia Trinh Company Chapter 3: Solutions, Recommendations and Conclusions. CHAPTER I: THEORETICAL BASIC 1.1 Concept of strategy 1.1 Concept of strategy “A strategy is the means to achieve long term goals of each of the persons or organizations”4. “A Business strategy is a series of commitments and actions that a company uses to spend a competitive advantage by exploiting core capacity in a certain market”.2 Comprehensive Model of the Strategic Management Process and Alternative Strategies. There are many models of strategic management but fundamentally different strategic management models are based on three basic steps which are strategy- formation phase, strategy-implementation phase and strategy-evaluation phase.1: A comprehensive strategic management Model6 Feedback Evaluate external factors to Build long- Set annual goals identify opportunities and term targets threats Define Measure, missions, Review tasks, Redistribute evaluate the objectives, objectives resources performance and current strategy Evaluate internal factors to Select Propose policies identify the strengths and strategies to weaknesses pursue Feedback Strategy Strategy Strategy Formulation Implementation Evaluation Basic business strategies 4 FRED R.VAVID, 2003, Concept review and strategic management, Thong Ke Publishers 5 Slide lecture part 2 - Business Strategy 6 FRED R.VAVID, 2003, Concept review and strategic management, Thong Ke Publishers 1 In the research, the authors agreed to examine characteristic strategies which may apply to the situation of the business.1 List of particular business strategies7 No NAME OF IMPLEMENTATION OF STRATEGY STRATEGY 1 Strategy combined with Increase in ownership or control over distributors and distributors and retailers retailers.
2 Strategy for stable Looking for ownership or control of the company’s supply of input. (Backward Integration) 3 Strategy with Find out the ownership or increased control for competitors (Horizontal competitors Integration) 4 Market entry strategy Search market share increases for existing products (Product Development) and services in current markets through greater marketing efforts 5 Market development Bring products and services available in new areas 6 Product development Increase sales by improving or modifying existing products and services 7 Diversity of supporting Add new products or services but related to each products (Related other Diversification ) 8 Product diversification Add new products or service without contact 9 Diversity of products to Add the products or services related to existing clients meet different needs of customers 10 Venture Two or more affiliated companies form an independent company for the purpose of cooperation 11 Narrowness of operation Reinforce through cutting down cost and asset to save sales and profits on decline 12 Reduction of operation Remove a branch or part of the company 13 Liquidation of assets Sell assets with tangible value 14 General Pursue two or more strategies simultaneously Red Ocean and Blue Ocean of ChanKim&Mauborgne Red Ocean (Focus on current customers) - Compete in existing markets.; Beat the competition.;Make the value-cost trade-off. ;Exploit existing demand. ;Align the organization with differentiation or low cost vs aligning the organization with differentiation and low cost.
Blue Ocean (forcus on noncustomer) 7 FRED R.VAVID, 2003, Concept review and strategic management, Thong Ke Publishers 2 - Creat uncontested markets to sever; Make the competition irrelevant.; Create and capture new demand; Break the value-cost trade-off.; Align the organization with differentiation or low cost vs aligning the organization with differentiation and low cost.2 Analyze the actual situation of company. Business situation analysis is to analyze the external trade environment affecting the operation of the business and evaluate the enterprise.1 Analyze the external environment. Analysis of external environment is also known as evaluation of external factors. Evaluation of external factors is to develop a portfolio of limited environmental opportunities which can benefit the company and the environmental threats that companies should avoid.2: Relationship between Key External Forces and organizations8 1.
The impact of Competitors, Suppliers The economy opportunities Distributors, Creditors and risks’ 2. The impact of society, Customers, Employees organization demography, culture, Communities, managers geography Stockholder, Labor 3. The impact of politic, union law, and government Government, 4. The impact of Trade associations.
The impact of Market Natural competition environment Evaluation of external factors can be divided into two parts: macro- environmental assessment and field-environmental assessment (competition).VAVID, 2003, Concept review and strategic management, Thong Ke Publishers 3 Assessing macro environment – PEST model PEST model is to study the impact of factors in the macro environment on business activities of enterprises. PEST model allows us to analyze fours macro factors affecting the enterprise.3 PEST Model Assessing field-environment – Model of Michael Porter’s five competitive forces Analysis of field and business environment will tell us the level of attractiveness of the business sectors as well as the competitive intensity of the industry so that businesses look out for trade travel and also determine the his position on the overall picture of business sectors. Model of Michael Porter’s five competitive forces allows us to analyze five competitive factors having the influence on the business of enterprise.4 Model of Michael Porter’s five competitive forces9 The risks from potential competitors Suppliers’ Buyers’ capability of The contention of capability of negotiation existing companies negotiation The threat of substitute products 1.2 Analyze the internal environment.VAVID, 2003, Concept review and strategic management, Thong Ke Publishers 4 Scrutinizing the enterprise is to recognize accurately the business in order to find the strengths and weaknesses to promote recovery or overcome as well as combine so as to propose business strategies appropriate with the resources of enterprise. The analysis of the enterprise focuses on the following factors: Administration, Analysis of five basic functions of management, such as: planning, organization, promotion, personnel and control.
Marketing, Analysis of basic functions of marketing, such as: Customers, Buying, Sale, Planning products and service, pricing, distribution, market research, opportunity analysis, responsibility for society. Accounting/ Finance, Analysis of financial functions, such as: Investment decision, financial decision, decision on dividends Production/ Implementation, Analysis of functions: Process, Capacity, Inventory, Labor force and Quality. Research and development, Analysis of two forms of basic R&D, such as: inside R&D, organizations of self-research and inside development. R&D in contract, companies hire researches or independent research organizations develop specific products.