HO CHI MINH CITY UNIVERSITY OF FOREIGN LANGUAGES AND INFORMATION TECHNOLOGY SCHOOL OF FORE IN LANGUAGES GRADUATION PAPER ANALYZING BUSINESS ACTIVITIES AT TRADE IMPORT EXPORT ELECTRONICS COMPANY (TIE CO) ADVISOR: Ms LE THl KIM DUNG, MBA STUDENT: Ms DoAN H~NH UYEN - STUDENT'S NUMBER: 0071175 CLASS:-KA0002 1. (!II ~~ HO CHI MINH CITY, JULY 2004 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ *. * ~ flCJ(;NoW£fE(}fE9rlfEm' ~ * * ** ** *** In complementing this graduation paper, I have received ** * ** * ~ valuable ideas and advice from my family, my teachers and my *~ ** friends as well as TIE Co. ** * * *** First, I would like to show my acknowledgement to my family ** * *~ for taking care of me and staying beside me anytime.
* ~ * ~ Second, I would like to express my gratitude to Ms Le Tht ~ * * Kim Dung, my advisor, for recommending, providing information * *** and giving me ideas and advice in the process of completing this *** *~ graduation paper. *~ * ~ Third, my thanks to Mr Nguy~n Vi(H Thu~n and TIE Co for ~ * * providing available data and supporting my study. * *** Thanks also to Huflit University and teachers teaching and ** * *: providing me knowledge, which helps me, a lot in my job in the :* * future. * *** And finally, heartfelt thanks to my friends for their helpful *** :* support and encouragement.
*: :* Ho Chi Minh City, 2004 :* : DoAN HA-NH UYEN : ** I.Lhfl; ~ -I:hJ v0'n ~uma-tfUFUT ** ~ NgCS 4~/(Jg I~ : : 1~/b---= : ~ ~(yAN -tfANH VYiN ~ * ~++++++++++++++++++++++++++++++++++++++++++~ * Student: DOAN HANH UYEN TfiBLEOF COtiTEtiT INTRODUCTION ABOUT GRADUATION PAPER 1 + Objectives + Scope + Method + Structure CHAPTER I: LITERATURE REVIEW 2 I. Definition: What is Management? 2 II. Function of Management. Management: The Control Function.
The Control Process 4 2. Phase of ControL 5 3. Behavioral ControL 6 IV. What is Effectiveness of Business Management? 6 V.
Criteria to evaluate the Effectiveness of Business Management: 7 1. Elements influenced to the Effectiveness of Business Management: 9 1. Human and Quality of managing 9 3. Quality of products 9 4.
Price of products 10 5. International business environment. l0 Student: DOAN HANH UYEN 6. Other factors 10 VII.
The necessaries of raising effectiveness of Business Management 11 1. Role of profit. Role of effectiveness of Business Management 11 VIII. Equitization 12 CHAPTER II: BUSINESS AND PRODUCTION ACTIVIYIES IN TIE Co ~.Introduction about TIE Co 14 I.
Establishment of TIE Co 14 II. The process of development ~ 15 III. Main products and services 16 IV.Analyzing Business and Production Activities 18 I. Analyzing business activities in TIE Co 18 1.
General Analysis 18 L Net Revenue and Net Income after Tax 21 3. Structure of Revenue 26 4. Structure of Profit 31 II. Analyzing business management in TIE Co 33 1.
Analyzing activities of managing and using capitaL 33 2. Analyzing structure of working capital and the effectiveness of using it 35 3. Analyzing situation of cash 38 4. Analyzing activities of using expenses 39 5.
Process of equitization .40 Student: DOAN HANH UYEN 6. Direction of Business Management Activities at TIE .41 CHAPTER III: EVALUATION AND SUGGESTION TO RAISE EFFECTIVENESS OF BUSINESS MANAGEMENT IN TIE Co A. Evaluating the Business Activities in TIE Co 42 I. General evaluation 42 II.
Advatages and Disadvantages. Suggesting to raise Effectiveness of Business Activities in TIE Co I. Raising revenue and profit. Strengthening available market.
Searching new markets 45 3. Strengthening marketing activities 46 II. Raising effectiveness of using cost. Raising effectiveness of controlling capital.
Reforming the management activities and raising labor productivity. Recommendation to the Government 52 CON CL USI 0 N 53 APPENDIX Photos of TIE Co REFERENCES. Student: DOAN HANH UYEN INTRODUCTION Vietnam economy has changed from the planned economy into a mixed one based on the market mechanism. Simultaneously, the open door policy in Vietnam opened not only new opportunities but also challenges for Vietnam enterprises.
However, they have still encountered a lot of obstacles because our economy is in the first step to experiment. Every company has wanted to maximize profits and to gain satisfactory results. So in order to do that, management activity is the first factor which decides whether that company has been successful or not. There are lots of kinds of enterprises such as state-owned enterprises, joint-venture companies, and limited companies, etc.
which makes Vietnam market flexible and fiercely competitive. Therefore, analyzing business activities in one enterprise to understand how well people manage their company. The aim of this research is to analyze and evaluate business activities at Trade Import Export Electronics Company (TIE Co). Analytic and synthetic methods were used to undertake this research.
The first part of this research is a summary of relevant theories of management. The second part provides introduction, business activities and effectiveness that TIE Co has gained in previous years. And the final part is evaluation on the business management and some suggestions to improve the effectiveness in TIE Co. 1 Student: DOAN HANH UYEN .aduulililL rpllpl!l' Chapter I: LITERATURE REVIEW OF BUSINESS MANAGEMENT I.
Definition: What is Management? It is very difficult to find a standard definition for commonly used terms in management. A current definition is that management is working with and through other people to accomplish the objectives of both the organization and its member. Besides, management is both a science and an art: + The science is represented by the theories and knowledge required through the management process. + The art is the application of knowledge to reality.
One of the arts of management is delegation because it makes management possible and management is the process as well as the art and skill of getting results accomplished through other people. Functions of Management: Fayollasserted that the activity of management was characterized by five specific functions. Planning: This function consists of forecasting future events and determining the most effective future activities for the company. I Henri Fayol (1841-1925) Developer of Administrative Theory 2 Student: DOAN HANH UYEN.
Organizing: This function consists of the ways in which the. organizational structure is established and how authority and responsibility are given to managers, a task called delegation. Commanding: This function concern how managers direct employees. Fayol addressed such activities as effective communications managerial behaviors, and the uses of rewards and punishment in discussing how a manager should command employees.
Coordinating: This function concerns activities designed to create a relationship between all the organization's efforts (individual tasks) to accomplish a common goal. Controlling: This function concerns how managers evaluate performance within the organization in relationship to the plans and goals of that organization. In another word, the management process consists of the four functions of management: planning, organizing, leading and controlling. 3 Student: DOAN HANH UYEN Planning Setting performance objectives and deciding how to achieve them Controlling Organizing Measuring Arrange tasks, The performance and people, and other Management resources to taking action to Process accomplish the ensure desired results work Leading Inspiring people to work hard to achieve ••• high performance Figure 1.1:The four functions of management: planning, organizing, leading and controlling.
Management: The Control Function: The control function is one of important criteria in management. The control process: The basic process remains: • Setting performance standards. • Measuring the performance. • Evaluating the performance • Making effective use of feedback and taking corrective actions.
Management and Organizational Behavior Essentials. John Wiley &Sons 4 Student: DOAN HANH UYEN • Feedback Meet standards. Create Measure Evaluate performanc actual performanc e standards performanc e Does not Take meet corrective standards action(s) Feedback The Control Process 2. Phases of control: • Input controls: They are budgets, job design, training programs with skills evaluation, MBO (Management by Objective), production and operation techniques and scheduling of work activities.
• Process controls: These following activities represent this kind of control: performance appraisals, quality controls, Management by Objectives and contingency plans. • Output controls: The control process may operate after the activity but before delivery to the end-users. This is an output control. This form of control may include quality control of the final output, the final MBO evaluation, and ex post.
5 Student: DOAN HANH UYEN .{jnuLllatiriIL fj)apn' 3. Financial Control: Financial control is a major form of management control. It involves: budgets and audits. Budgets are important tools for planning, organizing and controlling.
Budgets can be used as financial performance standards and as a framework for comparing businesses. Audits are formal evaluations of an organization's financial situations. A management audit examines managerial effectiveness. Behavioral Control: Behavioral controls in organization focus on the human side of the enterprise, evaluating an employee's behavior as it relates to task accomplishment.
Such performance appraisals serve as important management tools providing information on the current state of the organization, the strengths and weaknesses of employees, and the needs for the future. What is Effectiveness of Business Management? Effectiveness is, at its most basic, about getting effects. An effective manager is one who is able to get the effects that he or she wants. In another words, effective is maximum profit over minimum cost.
Output Effective of Business = Input • Output is measured by criteria such as industrial producing pnce, revenue and profit. • Input may include labor, salary, trading cost, material cost and capital. 6 I Student: DOAN HANH UYEN So, when evaluating the effectiveness of business management, we evaluate not only the final results but also the quality of process creating those results. And profit is the most important criterion.
However, that profit does not influence to the benefit of the economy and society. Criteria to evaluate the Effectiveness of Business Management: 1. Capital: Total of capital is established from many sources by the owner or state budgets. It reflects the ability of doing business and gaining profits in an enterprise.
Classification: Fixed capital Working capital. Fixed capital: Fixed capital used directly in the process of doing import and export business is offices, warehouses, and means of transport. Working capital: It is shown in the cash and assets. In an import and export company, working capital is an important element.
Thus, controlling and using it is very meaningful in the survival of this enterprise. Working capital consists of: Capital in cash Short-term investment. Advance Mortgage, collateral, short term deposit Inventory. 7 Student: DOAN HANH UYEN .(jFlLlLlIalilJIL qJafUl' Based on the balance sheet, we compare the opening balance with the closing balance so that we can give the conclusion of the effectiveness of using the capital.
An enterprise is considered as an effective one. when it is active in using the source of capital. Expenses: In import and export activities, cost is divided into selling expenses and general and ad expenses. We can classify expenses in the purpose of them: Scope: - Domestic - Oversea Property: .- Fixed cost - Variable cost Purpose: .- Transferring expense - Packaging expense - Tax, fee and charge - Expenses from provisions - Sundry cash expenses Evaluating the general and ad expenses help to reduce unnecessary expenses in order to increase profits.
And based on this evaluation, we find elements that influence to expenses and have solutions to decrease them. Profits: Profit is also an important criterion to evaluate the effectiveness of business management. Namely, in import and export activities, we have to 8 Student: DOAN HANH UYEN .l' pay attention to the inflation and foreign exchange, because after calculating the net present value of the margin, it maybe lower than the origin prices. Net profit after tax = Net profit before tax - Tax (Net profit before tax= Net Operating Income + Extraordinary gains) VI.
Elements influenced to the Effectiveness of Business Management: 1. Market: • Objective factor: It is socio-economic relationship between Vietnam and other countries.