The urgency of the topic
Vietnam's economy is increasingly integrating with global markets, leading to an expanded business environment for enterprises However, this growth also brings heightened competition, presenting both opportunities and potential risks that could impact business development To thrive, companies must prioritize continuous growth and adapt their business strategies, which are crucial for ensuring survival and success A well-formulated strategy not only enhances a company's vitality and flexibility but also strengthens its ability to capture and maintain market share both domestically and internationally.
Strategic planning is crucial for the survival and competitiveness of enterprises in the market, as it empowers them to proactively address risks and seize opportunities Modern strategic management emphasizes the importance of environmental analysis and the development of strategies tailored to these conditions Akira Co., Ltd., a company involved in toy production and the publishing of books, newspapers, and magazines, is exploring solutions to enhance its business strategy Consequently, the focus of this graduation report is on “Solutions to Improve Business Strategy at Akira Co., Ltd: A Change in Customer Approach.”
Research Objectives
- Study the foundation and strategic planning of the company
- Analyze the changes of the Company's business strategy from 2019 to 2020
- Propose solutions to support the implementation of the proposed strategy.
Scope of study
This article focuses on the application of specific analysis models within the broad field of business strategic planning It aims to develop a comprehensive business strategy for the company, along with actionable solutions to achieve its goals by 2020.
The structure of the study
In addition to Introduction, Conclusion and References, the internship report consists of 3 chapters:
Chapter 1: Theoritical Basis on Business Strategy
Chapter 2: Analysis of Current Business Strategy at Akira Co., Ltd.
Chapter 3: Solutions to Improve Business Strategy of Akira Co., Ltd.
THEORITICAL BASIS ON BUSINESS STRATEGY
Strategic management
According to Thompson, Strickland, and Gamble (2007), a strategy is defined as a management action plan for operating a business They emphasize that a company's strategy encompasses competitive dynamics and the methods managers use to grow the business, attract and satisfy customers, and achieve organizational performance targets Consequently, strategic management involves a systematic process of environmental review, strategy formulation, implementation, and ongoing monitoring and evaluation to ensure the successful achievement of long-term objectives.
Eden and Ackerman (1998) define strategy as a cohesive collection of distinct actions, underpinned by a target system and bolstered by key self-sustaining or opinion-driving forces within an organization, functioning as a comprehensive portfolio.
Mintzberg et al (1998), as referenced by Beckman and Rosenfield (2008), highlight essential considerations for organizations in strategy formulation and implementation Effective strategies are built on fundamental elements of attack, defense, and mobility, requiring the exploration of innovative combinations of these components Historically, the integration of technology and social organization has faced limitations, which have become perceived as natural over time Consequently, strategists often refrain from challenging established wisdom, focusing instead on variations of accepted practices To remain effective, leaders, akin to great commanders like Napoleon, must adapt their strategies by recognizing and integrating new combinations.
Ackerman's piecemeal actions exemplify "competitive actions and business methods," as defined by Thompson, Strickland, and Gamble A key aspect of their strategy definition is the emphasis on achieving sustainable target performance levels for the organization.
There are many authors who study strategy, so there are also many authors who write strategic management with different expressions.
In the early development of strategic management theory, strategy was primarily viewed as a long-term plan integral to organizational planning, leading to an emphasis on the function of strategic planning During this period, discussions around strategic management often centered on "business strategy and policy," with definitions focusing on it as a "collection of decisions" rather than the process itself This approach involved executing strategic management functions through a series of closed activities Authors Garry D Smith, Danny R Arnold, and Bobby G Bizzell systematically defined strategic management within this context in their work, Strategy and Business Policy.
- Strategic management is a collection of management decisions and actions that determine the long-term success of a company
- Strategic management is a collection of decisions and actions that lead to the planning and implementation of strategies to achieve organizational objectives.
By John Pearce and Richard B Robinson also gave a similar definition:
"Strategic management is a decision-making and action system that formulates and implements plans to achieve business objectives."
The term "strategic management" gained popularity, leading to increased focus on various management functions, including organization, control, and inspection Consequently, the concept of strategic management evolved to encompass a broader and more comprehensive understanding.
Strategic management involves defining the long-term goals of an organization, selecting appropriate actions to achieve these goals, and effectively allocating the necessary resources.
Strategic management involves analyzing both the present and future environments, setting organizational goals, and executing decisions to meet those objectives This process includes monitoring the implementation of strategies to ensure alignment with the organization's aims in an ever-changing landscape.
Strategic management, as defined by Fred R David, is both an art and a science that involves setting, implementing, and evaluating decisions across various organizational functions This approach integrates governance, marketing, finance, accounting, manufacturing, research and development, and information systems, all aimed at achieving the overall objectives of the organization.
Therefore, strategic management is the process of planning/formulating, implementing and evaluating strategies Based on the above concepts, the concept of strategic management can be concluded as follows:
Strategic management involves a series of activities designed to plan, implement, monitor, and adjust business strategies This cyclical process ensures that a business maximizes its opportunities while minimizing or eliminating potential threats, ultimately helping it achieve its objectives effectively.
The concept of strategic management has evolved significantly over time Initially, strategic decisions were infrequent and primarily the responsibility of senior managers Today, however, the strategic management process is recognized as an ongoing and dynamic activity that involves the participation of all organizational members.
Business strategy
Business strategy, as defined by Hofer and Schendel, encompasses the fundamental characteristics of games played by enterprises within their environments, focusing on establishing a competitive advantage in specific sectors It involves enhancing competitiveness by targeting attractive market segments Strategies are categorized into corporate, business, and functional regional levels, and their formulation requires consideration of management objectives, capabilities, and market dynamics This study aims to explore the interplay between the business environment, strategy, and personnel Additionally, Porter classifies business strategies into three primary types: differentiation, low-cost, and centralization strategies.
Research by Hagedoorn and Gemünden highlights the importance of collaboration between enterprises and their partners in product development Siksot and Langley emphasize that effective data exchange and horizontal communication can mitigate uncertainties and enhance development performance As product design complexity increases, Maamar and Shen assert that leveraging knowledge is essential for problem-solving, making collaboration crucial for achieving business goals Lu and Yang note the pressing need for companies to expedite product development due to shorter product life cycles, necessitating closer cooperation between R&D and marketing departments Joseph stresses the importance of strategic decision-making and continuous evaluation of R&D efforts to ensure project success Liu et al conducted a study on Taiwan's high-tech industry, revealing that product development strategies significantly influence product performance This study identifies six key strategies adopted by enterprises: shortening development time, minimizing design changes, reducing costs, sharing design knowledge, engaging in early development stages, and enhancing partner design capabilities These strategies serve as a foundation for further analysis and comparative case studies.
1.2.2 The role of business strategy
Business strategy has the following important functions for enterprise:
The business activities of enterprises are always influenced by external and internal factors Therefore, business strategy helps enterprises guide their future operations by analyzing and predicting the business environment
A well-defined business strategy enables companies to respond effectively to market fluctuations, ensuring they operate and grow in the right direction This proactive approach aids enterprises in enhancing their market position and achieving their objectives.
Business strategy can help enterprises seize opportunities and the integrity and risks of resource development
Business strategy is helpful for enterprises to rationally develop and utilize human resources and enhance their strength
This strategy creates an operation track for enterprises, and helps enterprises to link individuals with other interests in order to achieve common goals and jointly develop enterprises
Business strategy establishes close ties between employees and between managers and employees So as to enhance and further improve the internal strength of the enterprise
In today's globalized economy, a robust business strategy is essential for enterprises to effectively compete in a market characterized by intense rivalry and interdependence As companies navigate the complexities of economic integration, they must recognize the significant influence they have on one another, which further intensifies competition.
In addition to competitive factors such as: price, quality, advertising and marketing, enterprises also use their business strategies as effective competitive tools.
A company's business strategy shapes its competitive activities and resource allocation over the medium to long term to achieve its objectives Key strategies include centralized growth approaches such as market penetration, market development, and new product development, as well as diversified growth strategies like concentric, horizontal, and mixed diversification, and joint ventures.
A business strategy aims to identify the specific products or market segments a company will pursue, while also outlining how it will compete within those areas and establish its position among competitors This strategy encompasses business-level policies that focus on various industries or product categories, guiding their development to align with the overall company objectives To create an effective strategy, it is essential to assess the competitive advantages of each industry, ensuring consistency with the broader company strategies.
An enterprise's strategies consist of key decisions that significantly influence its market position and environmental control These strategies encompass various functional areas, with P Y Barreyre (1976) identifying six crucial functional strategies Among these, production and trade strategies are fundamental, serving as the foundation for developing other functional strategies.
Trade strategy is a set of long-term policies to determine the position of enterprises in the market
Financial strategy is a set of policies to ensure that the financial needs for pursuing commercial goals match the conditions set by the capital market
A production strategy encompasses a series of policies designed to identify the types and quantities of products to be manufactured, while also efficiently allocating resources and vehicles for market-ready production.
Social strategy is a set of policies aimed at establishing the behavior of enterprises towards the labor market and, more broadly, towards the socio-economic and cultural environment
Technological innovation strategy is a set of policies to research and develop new products and technologies and improve existing products and technological methods in use
A well-defined procurement and logistics strategy encompasses policies that promote effective procurement and optimal utilization of material resources throughout the entire process, from sourcing to production and consumption Just as a business strategy focuses on maximizing sales, implementing strong purchasing strategies is essential for achieving successful procurement outcomes.
Enterprise management strategies are interconnected, with each strategy serving as a foundation for the development of another The execution of one strategy can significantly impact the implementation of others, highlighting the importance of a cohesive approach in organizational planning.
The business environment of the enterprise includes:
- The internal environment of the enterprise.
The analysis of the macro environment helps the organization answer the following questions: What is the organization facing?
Enterprises, suppliers, customers and competitors all operate in a broad macro environment, which often creates opportunities as well as threats These forces are
"uncontrollable" forces that the company must monitor and deal with, including five main forces, namely economic, political, social, natural and technological forces.
Economic factors significantly influence every facet of production and business operations within enterprises These factors are shaped by the country's economic potential, which encompasses elements such as economic growth, bank interest rates, inflation rates, economic cycles, balance of payments, monetary policy, unemployment levels, and national income Additionally, the purchasing power of the market is crucial, as it directly impacts consumer demand and overall economic activity.
Production strategy Procurement and logistics strategy
A comprehensive financial strategy involves analyzing social factors such as income, pricing, savings, debt, and loan accessibility Strategic planning should focus on understanding consumer income and spending trends, as these elements can present both opportunities and threats to business growth By conducting economic factor analysis, managers can make informed forecasts and identify key trends in environmental changes, which serve as the foundation for industry and trade predictions.
Vietnam's socialist-oriented market economy has significantly contributed to its growth, supported by an open policy that encourages foreign investment Joining the WTO has opened up new development opportunities for the country, while also presenting challenges from increased competition and potential threats.
Government economic management policies encompass a range of strategies, including import and export regulations, pricing policies, and organizational salary guidelines Key components of these policies involve controlling inflation, managing external debt, and addressing budget deficits Additionally, the government supports businesses through essential services, such as the development of transportation infrastructure, electricity and water supply systems, information services, healthcare, and banking services.
Government political factors significantly influence the business environment and trading, encompassing aspects such as taxation, corruption, trade barriers, government stability, employment, and operational regulations (O'Brien 2015, 199) Additionally, economic factors, including economic growth, inflation rates, interest rate fluctuations, GDP trends, government expenditure, economic stability, and raw material demand, can impact a company's operations While there are numerous points to consider, the focus should vary based on the specific type of business involved (O’Brien).
The customer focus approach in business strategy
Kassem defines performance as the extent to which managers fulfill their designated responsibilities, while Szilagyi views it as the comprehensive assessment of an organization's operations and outcomes Additionally, Ramanujam and Venkatraman propose a performance evaluation framework that encompasses three key dimensions: financial performance, business performance, and organizational performance.
Covin and Slevin categorize financial activities into two key dimensions: growth and profit, highlighting that business performance is influenced by the entrepreneurial behaviors aligned with the senior management's philosophy They emphasize that true performance is rooted in the business model and the vision of upper management In their research, Murphy et al identified eight dimensions of business performance, with growth and profitability being the most prevalent To mitigate reasoning errors from performance comparisons across different companies, they recommend the use of control variables, noting that company size, industry, and age are the most frequently applied.
Product development primarily revolves around design and innovation, often necessitating collaboration with various partners to leverage shared technological advancements Research by Cooper and Kleinschmidt indicates that senior managers from leading companies like IBM, 3M, Northern Telecom, and Emerson Electric recognize that partnering in product development enhances team communication, shortens development cycles, and increases the success rates of new products Additionally, Littler et al found that businesses engaged in collaborative product development gain significantly more design knowledge at each stage than they would through independent efforts, enabling them to effectively harness valuable insights from external partnerships.
Farrukh et al emphasize that an enterprise's early leadership in market or technology significantly boosts its market share potential They advocate for enhancing external cooperation to manage technological complexity, shorten product life cycles, and lower costs and risks Joseph's research on internal and external control, team rewards, and customer interactions analyzed 95 projects across various industries, revealing that increased interaction leads to heightened focus on market and financial conditions Key evaluation metrics from their study include market share, customer satisfaction, product quality, and project management This paper consolidates these insights to identify performance evaluation indicators in the product development process, such as productivity improvement, cost reduction in design and development, production cost efficiency, information transparency, customer satisfaction enhancement, market share growth, reduced time-to-market, design capability enhancement, accuracy in design and manufacturing, technical efficiency, and robust project management and support These indicators will serve as performance evaluation metrics for product development in this study.
1.3.2 Financial indicators to evaluate business performance
1.3.2.1 The evaluation indicators of profitability a Return on assets – ROA
Return on Assets (ROA) represents the percentage of income generated by a company's assets
The ROA can be calculate as follows:
The rate of return on assets can be calculated using a different approach, where the net profit divided by income yields the marginal profit rate, and the average income divided by total assets provides the turnover rate of total assets.
Rate of return on assets = marginal rate of return × total turnover of assets b Return on Sales – ROS
Return on Sales (ROS) is a financial ratio used to track the profitability of a company It reflects the relationship between shareholders' net profit and company sales.
The Return on Sales (ROS) for a specific period is determined by dividing the net profit or after-tax profit by the total income for that period, expressed as a percentage.
Both net profit and income can be obtained from the company's income statement
The formula for calculating this ratio is as follows:
Revenue c Return on Equity – ROE
Return on equity is the financial ratio to measure the return on equity per share of a joint-stock company
The formula for this ratio is as follows:
Net income Average ordinary equity
1.3.2.2 Indicators of solvency a Debt-to-equity ratio
The debt-to-equity ratio is calculated as follows:
Debt-to-equity ratio = Debt Outstanding
The debt-to-equity ratio assesses a company's financial leverage by comparing its total debts to its total equity, highlighting how much of its assets are financed through liabilities This ratio is crucial for understanding an enterprise's ability to meet its debt obligations using its available equity Additionally, the equity-to-assets ratio provides insights into the proportion of a company's assets that are financed by its equity, further illustrating its financial stability.
The equity-to-assets ratio is calculated as follows:
Equity-to-assets ratio = Total equity
The equity-to-assets ratio measures the proportion of a company's financing that comes from equity as opposed to debt A higher ratio indicates a healthier financial position, while a lower ratio suggests a greater reliance on debt relative to equity.
ANALYSIS OF CURRENT BUSINESS STRATEGY AT AKIRA CO., LTD
Introduction of Akira Co., Ltd
Company Name: Akira Education Co., Ltd.
Headquarters: No 35, lane 1104 De La Thanh - Ngoc Khanh Ward - Ba Dinh District - Hanoi
AKIRA EDUCATION CO., LTD., established on December 19, 2017, operates in the field of specialized education services Located at No 35, Lane 1104 De La Thanh, Ngoc Khanh Ward, Ba Dinh District, Hanoi, Vietnam, this limited liability company has a registered capital of 1,800,000,000 VND Led by QUACH DUC ANH, the company's corporate structure, management skills, and financial ratios play a crucial role in assessing its business commitment and performance.
AKIRA EDUCATION CO., LTD., operating within the Other Education n.e.c sector, employs a total of 13 staff members across its various locations The company has reported total sales of $42,483.16 and is associated with 4,076 related companies Additionally, the financial metrics concerning assets, liabilities, and shareholders' equity have shown fluctuations over the years.
Figure 1 1 The organizational structure of the company
(Source: Administration - HR Department of Akira Education Co., Ltd.)
Mr Quach Tuan Khanh serves as the Director and legal representative of the Company, overseeing all business operations and ensuring compliance with legal and state regulations The Sales Department, led by the department head, is accountable for managing all sales activities, supervising sales staff, handling financial transactions, and addressing customer feedback effectively.
- Manage the whole administrative activities of the company
- Supervise the implementation of labor laws and regulations
- Implement human resources recruitment, training and development plans
- Coordinate and perform other tasks as required by the Board of Directors
- Labor management and insurance declaration shall be carried out according to law
- Update the legal provisions on the rights, responsibilities and obligations of employers and employees
- Receive and answer questions about the company's employee system and policies
- Supervise the implementation of rules and regulations on wages and bonuses
- Track and report personnel changes.
- Directly advising customers on study abroad programs.
- Assist clients in preparing study abroad documents.
- Support and care for international students and customers.
+ Technical Department: Consists of 2 divisions:
- Research and make forecasts about the changing situation of the market in the future.
- Plan and propose Marketing ideas: Market research, product, price, distribution, promotion strategies
- Organizing, implementing and developing new markets
- Perform market segmentation, product positioning, brand PR, media relations
- Production of Youtube video content.
- Editing, integrating videos and audiobooks.
- Follow up and release to the media.
2.1.4 Business results in the period from 2018 to 2020
Table 2.1: Business results of Akira Co., Ltd in the period of 2018 - 2020
From 2018 to 2020, Akira Co., Ltd experienced an increase in both revenue and profit, with the most significant growth occurring between 2018 and 2019 This surge was driven by the company's strategy to import high-quality products and introduce new offerings to the Vietnamese market Although the Covid pandemic and heightened market competition led to a decline in revenue growth in 2020, the company's revenue and profit still showed an increase compared to 2019.
Despite fluctuations in the national economy over the past two years, the company has maintained relative stability in its operations Although there has been a slight decline in pre-tax profit, this decrease is minimal, reflecting the dedication and hard work of both management and employees Moving forward, the company aims to enhance its performance in the upcoming year.
Current business strategy of Akira Co., Ltd
Between 2019 and 2020, the company introduced the "Learning English with Lioleo" product line and a corresponding YouTube channel for marketing purposes However, after nine months of subpar sales, the CEO opted for a strategic shift, prioritizing the creation of engaging YouTube video content to generate revenue and draw in more celebrities This new approach aimed to convert video viewers into customers for their books.
Discover a novel way to learn English with our innovative mobile applications, designed to enhance vocabulary through engaging card Scrabble games Users can quickly memorize over 1,000 essential words and sentence patterns from textbook programs, making language learning enjoyable and effective Experience the fun of competing with friends in exciting English games while improving your skills.
Akira Co., Ltd prioritizes customer satisfaction as the cornerstone of its strategy, recognizing that customers are the ultimate measure of the company's success To achieve exceptional performance, the company focuses on attracting, satisfying, and retaining customers through its "Learning English with Lioleo" series Unlike traditional product-oriented strategies that emphasize competition based on product superiority, Akira Co., Ltd adopts a customer-centric approach This involves moving beyond standardized products and large-scale distribution channels to better understand and meet individual customer needs However, the conventional relationship with customers, often limited to interactions with purchasing departments through traditional sales methods, can hinder deeper connections and insights into customer preferences.
The interconnectedness of the network economy offers opportunities for establishing a competitive edge through customer relationship structures Akira Co., Ltd.'s transition to online content fosters strong, enduring connections and deep knowledge, which are essential for building customer relationships These connections can be developed either directly with customers or indirectly through desired attachments, serving as vital sources of profit and sustainability Customer bonds signify investments in and around business products, as traditional product-based competition has diminished in its profitability Consequently, these links have emerged as the central force in strategic development.
Figure 2.1 Business strategy by layers of Delta project model 2.2.2 Current strategic map
The strategic map is an effective tool for strategic planning that visually represents the complete strategy of Akira Co., Ltd on a single page, highlighting the interconnections and causal relationships between various elements of the organization's strategy.
Policy mapping technology is designed to help management teams discover and discuss policies in more detail than usual
Akira Co., Ltd utilizes strategic mapping to develop effective, actionable strategies that align with their vision and goals This approach facilitates the formulation of tasks and action plans while addressing potential challenges in transitioning to online platforms like YouTube.
This strategy is mainly aimed at children's audience The course content follows the standard curriculum of the Ministry of Education and Training With the gentle
"Learning through play enables children to acquire over 1,000 words and sentence structures, significantly enhancing their academic performance This educational kit utilizes game-based and multi-sensory learning techniques, offering children an engaging and innovative approach to learning As they develop holistically, their early language memory and cognitive skills are also improved."
Figure 2.2 Strategic map for Akira Co., Ltd.
External factors influencing business strategy of Akira Co., Ltd
The unpredictable nature of the current economic landscape is largely influenced by the intensification of globalization, prompting nations to impose restrictions on each other's economies When a major country faces economic difficulties, the repercussions extend beyond its borders, affecting global markets and economies.
The exchange rate fluctuations of the Vietnamese dong against major currencies significantly impact the company's operations, as approximately 30% of its publications depend on external sources Consequently, any devaluation of the Vietnamese dong poses a direct risk to the company's production costs.
The intricate interplay of inflation and interest rates significantly impacts loan accessibility, influences raw material prices, and affects production costs, ultimately determining a company's operational efficiency and productivity.
In the wake of the recent economic recession, Vietnam's economy is in a recovery phase, yet it continues to feel the repercussions of the COVID-19 pandemic This has led to some negative effects on the education market To adapt to the current economic landscape, there has been a shift towards online solutions, including video demonstrations, which aim to address the demands of 2020's economic situation.
Vietnam boasts a stable political environment, instilling confidence in businesses and fostering a secure atmosphere for investment growth This stability not only enhances the development of infrastructure but also supports the cultivation of human resources essential for business success.
Administrative reform has been successfully implemented, garnering support from both domestic and international investors Key areas such as customs procedures, tax collection, and company inspections have been streamlined to alleviate the burden of administrative processes Additionally, efforts to combat corruption have been intensified Understanding the influences of government and political factors enables companies to navigate the legal framework effectively, allowing for greater autonomy in their production and business operations.
The government continues to implement various policies aimed at promoting the growth of import-export businesses and facilitating international trade These initiatives include favorable regulations on import-export taxes and VAT, which enable enterprises to accumulate capital, reinvest in production, expand their operations, and enhance workforce training As a result, businesses can improve their competitiveness in today's market.
The Company must adhere to the publishing and intellectual property laws due to the specific nature of its industry Any changes in regulations concerning copyright and work protection will have a direct impact on the Company's production activities.
In today's competitive landscape, industries and companies must adopt advanced technological tools to streamline their production processes This modernization not only improves product quality but also boosts the overall competitiveness of each product category within the organization.
The State also always encourages enterprises to use modern technology with preferential tax policies.
With the growing technology trend, the company always needs to train itself a capable workforce to be able to respond promptly to the development of science and technology.
The company has transitioned to prioritize the creation of YouTube video content to enhance revenue and attract a larger audience This shift necessitates the use of advanced editing, assembling, and dubbing technologies to produce high-quality videos.
2.4 Internal factors influencing business strategy of Akira Co., Ltd
No Internal factors Importance level
3 Location Advantage and Place of
4 Financial capacity and large amounts of capital
7 Marketing activities are not high 0.15 2 0.30
The critical fraction of 2.98 suggests that while the enterprise possesses a decent internal strength, there remains room for improvement in resource utilization, including finances, geographical advantages, human resources training costs, effective information systems, and infrastructure quality To enhance their competitive edge, the enterprise must not only capitalize on its strengths but also address its weaknesses, particularly those affecting human resources training, which plays a vital role in overall performance.
In the past three years, the surge in educational publications in the Hanoi market has significantly boosted the mobile accessory retail sector, benefiting not only large corporations and enterprises but also small businesses and individual retail households.
Since its establishment in 2014, the company has navigated a competitive landscape in Hanoi's mobile technology equipment sector, initially facing only five rivals: Yellow Pages Education Consulting, Dan Tri Education and Training, Liberty Education and Training, and Akira Co Ltd However, by 2020, the market has expanded significantly, with numerous new companies, shops, and individual businesses emerging, intensifying competition and fostering a robust customer base across various regions Additionally, the years 2019-2020 marked a notable surge in the growth of large enterprises within Hanoi's education sector.
Foreign copyright suppliers significantly influence product costs, contributing 40%-50% of the overall value However, the company benefits from strong relationships with numerous publishers, ensuring timely technical and copyright support along with a stable pricing policy As a result, there is minimal pressure for price increases from suppliers, allowing for competitive pricing.
Domestic suppliers are contracted by the Company through long-term agreements, ensuring a consistent supply of quality materials and services at stable prices.
Evaluation of current business strategy of Akira Co., Ltd
2.5.1 Coherence of Akira Co., Ltd.'s mission with business strategy
An analysis of business strategy literature reveals that Akira Co., Ltd employs three key knowledge strategies: development, sharing, and utilization While it is crucial for a company to implement all three strategies with equal importance, limited resources necessitate careful balancing of these approaches As highlighted in the introduction, numerous authors argue that a business strategy must align with both the competitive landscape and the organizational context.
According to this strategic model, which is decomposed into three interactive elements, Akira Co., Ltd must conduct three macro analyses to formulate and implement its business strategy:
In the context of Vietnam's business landscape, it is essential to analyze both internal and external factors that influence a company's development strategy The internal environment encompasses organizational elements that drive enterprise transformation, while the external environment pertains to the competitive landscape in which the organization functions Understanding these dynamics is crucial for formulating effective business strategies that foster growth and adaptability.
The article examines the key objectives of the company's strategic development, focusing on essential skills, participation metrics, and business assets It emphasizes the financial, economic, organizational, and human resources required to effectively formulate knowledge strategies and establish sustainable competitive advantages.
To effectively manage knowledge assets and achieve established goals, it is essential to define clear policies and procedures This involves outlining the steps necessary for strategic planning, decision-making, business strategy formulation, and organizational structure development Utilizing social media channels can enhance the process by facilitating communication and collaboration.
2.5.2 The effectiveness of the strategy in relation to the internal and external environment
2.5.2.1 Effectiveness of the strategy on the internal environment
The company has successfully built a strong brand and reputation within the domestic market, with its products widely distributed across the country through extensive communication channels This established presence serves as a foundation for driving sustainable development and future growth.
-Secondly, the company has market share through distribution channel system and traditional customers In the field of providing educational products for more than
Over the past five years, the company has developed a robust product distribution channel system Our clientele primarily consists of reputable packaging and printing companies, both domestically and internationally This strong network of well-known partners serves as a crucial foundation for the company's growth and success.
-Thirdly, employees have many years of experience in ink production and trade. This is an advantage to help the company respond to customer requirements in the best way.
2.5.2.1 Effectiveness of the strategy to the external environment
Vietnam has experienced stable economic and political integration, which has significantly contributed to its development The country's effective integration into both regional and global markets has provided domestic enterprises with opportunities to expand internationally This favorable environment has allowed companies to leverage these conditions to successfully implement their business strategies in recent years.
The demand for industrial ink products is experiencing a sustained recovery and growth, driven by the gradual rebound of the global economy following the recent economic crisis This increasing market demand, both domestically and internationally, is expected to positively impact the company's production and sales activities.
Thirdly, the development of science and technology is very strong Assist the company to access and modernize production technology according to international standards and practices.
2.5.3.1 The evaluation indicators of profitability
For example, ROE ratio analysis:
Table 2.3 Analysis Table of Return on Equity
Average equity 140,481,501,041 204,818,766,875 200,499,413,265 Pre-tax profit and interest
Economic rate of return on assets
(Source: Financial Statements of the Company in 2020)
The analysis indicates a gradual increase in return on equity over the years, although the ratio remains relatively low In 2018, every 100 dong of equity yielded a profit of 0.11 dong, which rose to 0.4 dong by 2020 The corporate income tax rate was 28% in 2018 and 2019, reducing to 25% in 2020, resulting in higher tax obligations for companies during 2018-2019 compared to 2020.
Utilization rate of fixed assets
Working capital turnover days at a time
Average utilization rate of fixed assets
Average labor capital utilization rate
(Source: Financial Statements of the Company in 2020)
Between 2009 and 2011, the Company invested significantly in new transportation and management equipment to enhance its business operations This investment led to an increase in net revenue during the same period; however, the growth in net revenue was outpaced by the rise in asset investment, resulting in a decline in asset utilization efficiency.
2010 but then in 2011 the efficiency of asset use started to increase It proves that in
2011 the company has a more effective equity-to-assets ratio than previous years, but the efficiency is not high, reaching only 0.4 times Debt-to-equity ratio remains worrisome
1 The level of competition is becoming more and more fierce More and more enterprises in domestic and foreign markets are participating in it The competitive pressure of company operation is increasing This is the challenge that the company needs to face in the process of operation
2 The supply of educational publications is always unpredictable The impact of the COVID-19 pandemic has also reduced customers' interest in offline shopping services, so they are more interested in online channels, and the company has not really invested a lot of money Strong products and export channels
3 Customers have higher and higher requirements for product quality (safety and environmental protection) This is the inevitable trend of market mechanism With the development of social economy, the quality standard has also been improved.Especially the taste of online video products.
SOLUTIONS TO IMPROVE BUSINESS STRATEGY OF
The development plan of Akira Co., Ltd
The business market is crucial for a company's existence and growth, making it essential to research strategies for stabilizing traditional markets while exploring new opportunities Companies aim to develop solutions that leverage their internal strengths and capitalize on external environmental opportunities to achieve market expansion and stability.
To enhance its market position, the Company should concentrate on its core segments while analyzing and predicting upcoming consumer trends Conducting thorough market research and establishing a robust distribution marketing network will be essential Additionally, the Company must remain agile and responsive to competitor movements to maintain its competitive edge.
To enhance the effectiveness of its distribution system, the company should focus on improving the quality of both pre-sales and after-sales services tailored to consumer market needs It is essential to diversify product consumption channels, with a strong emphasis on developing online distribution avenues to reduce reliance on intermediaries Embracing e-commerce as a dynamic distribution channel will allow for effective promotion of products through various methods, while also ensuring convenient technical support during and after the sales process to better serve customers.
To enhance product introduction and promote the company image, it is essential to build a strong brand by reviewing existing product strategies Immediate investment should focus on developing highly competitive products for large current markets, with a gradual shift towards high-value offerings Continuous improvement in product quality, design, and prototyping is vital, transitioning from low- and medium-quality products to high-quality, high-value alternatives Additionally, widespread advertising through mass media will support brand building, alongside strong commitments to the value delivered to customers.
- Develop and develop many forms of payment
Enhancing customer satisfaction and boosting competitiveness requires the implementation of convenient payment methods To achieve this, the company should offer a variety of payment options tailored to customer preferences Additionally, introducing a late collection policy for traditional customers can further improve their experience and loyalty.
The Company currently lacks a dedicated Marketing department, resulting in weak market research and development To address this, it is essential to establish a specialized marketing team and research groups focused on analyzing and forecasting for various market segments This department should possess a deep understanding of operations to accurately capture market characteristics Additionally, it will provide reliable data on market trends, competitors, and distribution channels, enabling the Company to make informed production decisions Collaboration with other departments, such as production and finance, as well as the strategic planning team, will be crucial for developing effective production plans.
Proposed solutions
3.2.1 Propose solutions according to Delta project model
In a democratic management organization, departmental leaders provide strategic direction, allowing individuals the autonomy to decide how to implement these initiatives Team members are encouraged to share their ideas with leaders to collaboratively identify the most effective solutions However, when needed, leaders will offer specific guidance to ensure tasks are completed efficiently and promptly.
The educational publishing industry is undergoing rapid changes, necessitating an adaptation of product life cycles to align with advancements in printing technology Consequently, analyzing the product life cycle is crucial for enhancing the design of new educational materials.
To actively engage in investment and business activities, companies must develop comprehensive financial plans Diversifying financing channels and securing both internal and external investment are essential to overcoming fund passivity Utilizing joint venture capital can enhance investment and development capabilities Additionally, a strategic restructuring of assets is crucial for optimizing financial resources.
3.2.2 Propose solutions according to the strategy map
In today's fast-paced development era, the efficiency of modern management systems is crucial for minimizing labor and ensuring quick, accurate hospital operations Akira Co., Ltd is advancing solutions to enhance and replace outdated management systems, including comprehensive management software To keep up with the rising demands for rapid work processing and precise information responses, the company is focused on developing and implementing tailored management systems for each department.
Make full use of the capabilities of existing personnel and limit the recruitment of more personnel At the same time, regular training and retraining of employees are carried out.
To optimize the marketing department's effectiveness, it is essential to gather and analyze information regarding the market, customers, and competitors to support the company's business strategy and enhance consumer engagement Investing in research and product testing is crucial for improving brand image and establishing a foundation for collecting customer feedback Additionally, the company should enrich its website with detailed information, including its profile, organizational structure, major projects, product offerings, a comments section, and helpful consultation resources Maintaining a flexible pricing strategy informed by ongoing market research is also vital for adapting to consumer needs and preferences.
Investing in research and development (R&D) should be viewed as a long-term strategy, necessitating careful evaluation of investment projects It is essential to conduct thorough market research and maintain strong collaboration with the marketing team Additionally, clearly defining the development direction enables the company to accurately assess its human resource needs in both quantity and quality.
After almost three years in operation, Akira Co., Ltd has established a strong market presence As the demand for audiobooks and online educational videos among Vietnamese consumers continues to rise, the company's strategic business planning will enable it to capitalize on opportunities and navigate challenges, ensuring sustained growth and development.
Building a robust business strategy is crucial for companies, as it enables them to clearly define their goals, outline effective paths, and allocate resources efficiently to achieve objectives within a specified timeframe In this thesis, the author proposes several innovative solutions aimed at helping Akira Co., Ltd reach significant milestones in its strategic planning for production and business, while also enhancing the company's market position Acknowledging the dynamic nature of the business environment, the author recognizes that their perspective may not address all practical challenges faced by Akira Co., Ltd Therefore, constructive feedback from educators and the Board of Directors is welcomed to refine and implement these strategies effectively.
Due to the limited time and resources, the report cannot avoid errors The writer is looking forward to the advice of the readers.