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GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION CAPSTONE PROJECT REPORT BUILDING STRATEGIC PLANS FOR MILITARY INSURANCE JOINT STOCK COMPANY TILL 2015 Subject : Plan Management Class : GaMBA01.V03 Perform : Group 08 List of members: LÊ TRUNG THÀNH NGUYỄN THANH SƠN NGUYỄN VĂN MINH NGUYỄN VĂN LỢI Nghe An, April 2011 Global advanced Master of Business Administration CONTENTS LIST OF PICTURES AND DIAGRAM .v PREFACE vi TESTIMONIAL vii PREAMBLE viii Why choose research topics .viii Research objectives viii Scope of research viii Research methodology ix CHAPTER I THE RATIONALE FOR BUILDING THE BUSINESS STRATEGY 1.1 BASIC ISSUES OF BUSINESS STRATEGY: 1.1.1 The concept of business strategy 1.1.2 Basic characteristics of business strategy .1 1.1.3 The role of business strategy 1.2 DETERMINE VISIONS AND MISSIONS, OBJECTIVES OF THE BUSINESS: 1.2.1 Visions 1.2.2 Missions 1.2.3 Objectives 1.3 ANALYSE BUSINESS ENVIRONMENT OF THE ENTERPRISE (EXTERNAL ENVIRONMENT) .4 1.3.1 Macro factors 1.3.2 Micro factor (industrial and competitive factor) 1.4 ANALYSE ENVIRONMENT INSIDE BUSINESS 1.5 STRATEGIC ANALYSIS TOOLS .8 1.5.1 Strategic planning steps 1.5.2 The analytical tools 1.6 OPTIONS OF STRATEGIC IMPLEMENTATION 10 CHAPTER 2: ANALYSE BUSINESS ENVIRONMENT AND STATE OF THE MILITARY INSURANCE JOINT STOCK COMPANY 11 2.1 OVERVIEW INTRODUCTION OF THE MILITARY INSURANCE JOINT STOCK COMPANY 11 2.1.1 History 11 2.1.2 Brand name 13 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 ii Global advanced Master of Business Administration 2.1.3 Branch Network 14 2.1.4 Business activities: 14 2.2 ANALYSE BUSINESS ENVIRONMENT OF MIC .15 2.2.1 Analyse Macro-environment 15 2.2.1.1 Institution-legislation factors .15 2.2.1.2 Economic factors 15 2.2.1.3 Socio-cultural, natural factors 16 2.2.1.4 Technological factors 16 2.2.1.5 Integrating factors 16 2.2.2 Analyse micro-environment, industry environment of MIC 17 2.2.2.1 Competition among insurance enterprises 17 2.2.2.2 Pressure from insured customers 21 2.2.2.3 Competitive pressure from potential competitors 22 2.2.2.4 Insurance products .22 2.2.3 Synthetize business environment of MIC .23 2.3 ANALYZING INTERNAL ENTERPRISES MIC (Analysis of S, W) 25 2.3.1 Analysis of human resources and management skills 25 2.3.2 Assess the level of administration of the MIC 29 a Strategic planning: 29 b Organization management: 29 c Leadership: 29 d Inspection and control: 29 2.3.3 Assess Information Technology capacity: 30 2.3.4 Assess the financial potential of MIC 30 CHAPTER 3: STRATEGIC SELECTION AND STRATEGIC SOLUTIONS OF MILITARY INSURANCE JOINT STOCK COMPANY 36 3.1 BUSINESS STRATEGY OF MILITARY INSURANCE COMPANY (MIC) TILL 2015: 36 3.1.1 The basis for establishing the business strategy of MIC till 2015: .36 3.1.2 Business strategies of MIC till 2015: 36 3.1.2.1 Strategic vision: 36 3.1.2.2 Mission: 36 3.1.2.3 The core value: 36 3.1.2.4 Strategic Objectives: .36 3.2 Development Strategy of MIC till 2015: 41 3.2.1 SWOT matrix of the MIC: 41 3.2.2 Analyse the strategic options: .44 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 iii Global advanced Master of Business Administration 3.3 MEASURES OF STRATEGIC IMPLEMENTATION OF MIC TILL 2015: 47 3.3.1 Solutions of restructuring business operations of insurance: 47 3.3.2 Solutions to improve the quality of customer service 48 3.3.3 Solutions to expand the distribution channel systems: 48 3.3.4 Solutions to build brands and promote the image of the MIC: .50 3.3.5 Solution of restructuring departments structure to improve business: 50 3.3.6 Solutions to the administration of human resources and attracting talent of the MIC: 52 3.3.7 Solution of information technology: 53 3.3.8 Solutions of expansion of financial investment activities: 54 3.4 IMPLEMENTATION STRATEGY ROADMAP TO 2015 54 3.5 SOME PETITIONS: 55 3.5.1 For the Insurance Supervisory Authority: 55 3.5.2 For the Association of Vietnamese Insurers: .56 3.5.3 For Military Insurance Joint Stock Company (MIC): 56 CONCLUSION 57 REFERENCES 58 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 iv Global advanced Master of Business Administration LIST OF PICTURES AND DIAGRAM Content Page Table 1.1 Strategic planning process Table 1.2 competitive pressure models of M.Porter Table 1.3 The synthesized table of strengths and weaknesses of the enterprise (SW) Table 1.4 The SWOT matrix 10 Table 2.1 Data of the insurance market in 2008; 2009; 2010 18 Table 2.2 The synthesized table of opportunities and threats (OT) for the MIC 24 Table 2.3 Structure of the Military Insurance Joint Stock Company 27 Table 2.4 Summary financial reviews in 2008, 2009, 2010 30 Table 2.5 Revenue structure of the operations of MIC 31 Table 2.6 Results of business activities in 2007, 2008, 2009, 2010 of MIC 32 Table 2.7 Synthesizing internal analysis of MIC 34 Table 3.1 SWOT matrix of MIC 41 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 v Global advanced Master of Business Administration PREFACE To have this research results, we would like to show our sincere gratitude to Griggs University, Center for Educational Technology and Career Development (ETC) and especially all lecturers for the enthusiastic teaching, instruction and provision of valuable knowledge We also want to thank the leading board of Military Insurance Joint Stock Company as well as its offices, divisions that have helped our group to complete the following topic “business strategy construction for Military Insurance Joint Stock Company by 2015” The process of research and construction of this capstone project report is based on the collected information at the company, related materials, theories of analysis tools and methods provided by the program of Global Advanced Master of Business Administration organized by Griggs University – the US coordinated with ETC – Viet Nam National University Due to limited time but large research scope, then we cannot avoid making mistakes and limitations Our group expects to receive useful comments from the program, lecturers, leading board and cadres of the company to supplement, adjust and complete the report’s content to be applied into the long term development of the company Once again, we would like to show our great gratitude to all lecturers, leading board of Military Insurance Joint Stock Company for creating the best condition for the group to complete this report Nghe An, April 2011 Group – Class: GaMBA01.V03 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 vi Global advanced Master of Business Administration TESTIMONIAL Via working and studying report on “strategy plans for Military Insurance joint-stock company” prepared by Group of GaMBAV03, we have some following comments: - Working awareness of the group During working time at the company, we have realized that the group has earnest and serious working awareness; apart from main activities of the group including collecting data, visiting, business process…the group also gets consultancy from leaders and staff of the company - Report quality This report is written based on data and information provided by us as well as documents, policies and information directly related to the company After studying and listening to the presentation of final report, we have realized that reality assessments and analysis are very thorough and practical Solutions that group recommends are really useful for company’s development Finally, we want to show our gratitude to the group which has recommended solutions for business development of the company We will study such solutions to apply into reality of production and business activities We also wish to show our gratitude to the course on Global Executive Master of Business administration organized by Griggs University coordinated with Centre for Technology and Career System – Ha Noi National University that has equipped learners with knowledge to support company in finding out such realistic and useful solutions Best regards./ Vice Director General Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 vii Global advanced Master of Business Administration PREAMBLE Why choose research topics Affiliation WTO and commitments to open markets have been creating significant changes to the Vietnamese insurance businesses, opening up many opportunities that can exploit to develop business, as well as taking more opposite impact and challenges that have to be overcomed after joining the WTO A series of State insurance enterprises such as Bao Viet, Bao Minh, Vinare, PetroVietnam Insurance (PVI) sold shares to foreign strategic partners who are the international insurance group This is seen as a real revolution in the insurance industry in order to increase competitiveness and maintain enterprises’ own market shares In this context any insurance businesses that wants to survive and develop must build a suitable business strategy for themselves Wishing to be able to build a strategic that orients development for the Military Insurance Company in the future, the group of MBA01.V03 class selects assignment "Building the business strategy of Military Insurance Company to 2015" Research objectives Business environment of insurance is competitive more and more fiercely among insurance companies Selecting this topic, our group expects to achieve the following objectives: - Analyze the main factors affecting and deciding the business operation results of the MIC in the present and future - Build business development strategy to 2015 - Provide solutions to fulfill the proposed strategy Scope of research When executing this topic, group researchs primarily in the company activities, collects local data and insurance industry in order to propose development strategies for the business in the period 2010-2015 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 viii Global advanced Master of Business Administration Research methodology We use a combination of qualitative research methods basing on analysis and synthesis of primary, secondary data obtained from many different sources, collect company’s internal data, newspapers, magazines and internet relating to insurance and group discussions The structure of the topic: This topic includes the main parts: Chapter I: The rationale for building the business strategy Chapter II: Analyse business environment and state of the Military insurance joint stock company Chapter III: Strategic selection and strategic solutions of Military insurance joint stock company Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 ix Global advanced Master of Business Administration CHAPTER I THE RATIONALE FOR BUILDING THE BUSINESS STRATEGY 1.1 BASIC ISSUES OF BUSINESS STRATEGY: 1.1.1 The concept of business strategy Business strategy of enterprise is the overall, long-term objective to develop business, help businesses promote their strengths and opportunities, overcome weaknesses and challenges from which they can win the competition and achieve goals 1.1.2 Basic characteristics of business strategy Business strategy of the enterprise has the following basic characteristics: - Business strategies determine the basic objectives and business direction of the business in each period - The orientation of the strategy in order to ensure business develop continuously and firmly in the constantly fluctuating business environment - Business strategy in order to ensure maximum mobilization and optimal combination of the exploitation and use of enterprise resources in the present and future, taking advantages, seizing opportunities to gain advantage in competition - Business strategy of the enterprise is reflected throughout the continuous process - Business strategy has ideology that advancing, winning on the market place - Business strategy is built in a long period (three to five, ten years) 1.1.3 The role of business strategy The roles of business strategy of the enterprise are shown on the following aspects: - Business strategy helps business identify its purpose, direction as a basis, a guideline for all business activities of enterprise - Business strategy enables business to seize and take advantage of business opportunities, develop their strengths, and have proactive measures to overcome Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 Global advanced Master of Business Administration weak There are no measures to disseminate effective advertising From the above SWOT analysis, we can choose groups of the development strategies for the MIC including strategies: - Market occurrence, product and insurance services diversification strategy - Strategy for building a professional staff and modern management processes - Strategy for promotion and diversification of investment activities - Expanding and strengthening cooperation with domestic and foreign insurance and re-insurance partners - Maketting, branding strategy - Continue to apply the advanced information technology system in management 3.2.2 Analyse the strategic options: - Market occurrence, product and insurance services diversification strategy MIC provides 80 insurance products under the sectors of property insurance, human insurance, import and export cargo insurance, boat insurance, motor insurance, building- installation insurance and liability insurance products of the Company is suitable for international insurance market usual The company continues to develop products that meet the diverse needs of the market, the characteristics product in the army as soldier’s accident insurance, and expand service delivery channels through the banking system in the Bancassurance products Recently, MIC has launched three new products: global travel insurance, personal credit insurance, professional liability insurance Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 44 Global advanced Master of Business Administration In which, global travel insurance applies to all subjects being Vietnamese, foreigners residing in Vietnam from weeks to 80 years old to study, work, travel, visit personnel family abroadly Before deploying this product, MIC has signed service contracts with the leading international healthcare, medical assistance, and security services SOS Company having worldwide network for customers to use the facilities of SOS at all all other territories worldwide MIC determines global travel insurance products as the strategic product with a large amount of coverage, scope, extended insurance benefits, competitive premium rates MIC committed to offering clients financial peace of mind about the unwanted risks can happen in trip For personal credit insurance, customers can choose insured from million to billion VND, with competitive cost rates from 0.36% to 0.40% of the sum insured per year To encourage customers insured under the loan term, MIC also offers flexible insurance term from months to 60 months, according to that, the longer period the customer insured, the lower premiums are With this product, MIC look forward to working with banks, credit organizations, help to reduce credit risk for the type of mortgage loan, mortgage assets forming and create more peace of mind for individual when loaning Professional liability insurance is a product with broad coverage, applicable to many individuals, organizations and companies practicing professional This is insurance product with high efficiency The amount of insurance is followed requirement, agreement of insurer, the competitive premium suits with market conditions MIC commits to give customers financial peace of mind about the misfortune risks can happen while practicing professional In addition to developing and diversifying products, MIC should focus on developing old products bringing high sales: construction, installation insurance, vehicle insurance for the vehicle insurance product, this is a product of the high proportion of revenue (nearly 50% of the original insurance premium revenue), but this operation is very large compensation, so the MIC needs to focus and control input and output of this operation more closely: not run sales, select customer, compensation should be paid properly and fully Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 45 Global advanced Master of Business Administration - Strategy for building a professional staff and modern management processes Promote the personnel training, particularly top experts training in the insurance areas at the most reputable insurance training in the world Build staff having specialized technical expertise combined with experience and in-depth knowledge of the insurance business Deploy applying and standardizing procedures of providing insurance services as well as settlement of compensation claims in the insurance business and is gradually improving as the international standard - Strategy for promotion and diversification of investment activities In the 5-year period from 2008 to 2012, MIC will continue to implement capital increase to improve finance capacity With abundant capital, insurance premium revenue and operation provision, the MIC continues to diversify its investment activities in the areas of securities, real estate and other forms of financial investment To promote real estate business, MIC should quickly establish a real estate company and financial investment company in the future - Expanding and strengthening cooperation with domestic and foreign insurance and re-insurance partners Actively expand relations with domestic and foreign insurance and reinsurance partners to increase revenue from reinsurance activities, and arrange annual reinsurance programs to ensure financial stability for business With the diversified reinsurance cooperation, MIC can provide the most competitive insurance service in the market - Maketting, branding strategy Was entitled "Military Insurance", MIC should focus their industrial advantage: - Through the seminars, and the broadcasts of Military TV, MIC promotes its image much more: introduce the insurance products of MIC to audiences, advise customer approaches to manage risk as well as strengthen the prevention and limitation of damages Hope TV audience as well as customers have more knowledge about the prevention and limitation of losses and join the types of insurance to ensure financial security for themselves as well as business when the risk occurs Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 46 Global advanced Master of Business Administration - MIC is necessary to adhere to the units under the Ministry of Defense to deploy military personnel accident insurance, property insurance service (buildings, warehouses, vehicles, etc), boat, cargo and shipbuilding insurance - Coordinate closely with the Military Bank, promote more coordination: + Coordinate exploitation of borrowers at the Bank Army + Develop Bancass insurance products - Continue to apply the advanced information technology system in management MIC now has insurance business management, reinsurance, financial accounting, investment, human resource management software, separate management software of vehical compensation record is developing and pilot implement in several branches, such as Hanoi branch office management ensures continuously updating of information for management However, information technology should be regularly updated and modernized, so in the future, MIC must provide precede information technology systems as the basis for the acceptance and application of advanced management methods in the world 3.3 MEASURES OF STRATEGIC IMPLEMENTATION OF MIC TILL 2015: 3.3.1 Solutions of restructuring business operations of insurance: - Research insurance needs of customers in each target market segments to build the right product strategy and implementation plan for each group, a separate product - Research to design new insurance products that the Vietnamese market has not developed as liability insurance product Implement encouraging, supporing policies attaching in the implementation of new products - Check up on all current insurance product portfolio of company to have improvement, the product structure suiting with market needs and characteristics of the company - Put the creative ideas in designing insurance products to differentiate product of the MIC from the product of competitors Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 47 Global advanced Master of Business Administration - Improve the exploitation and compensation process for each insurance operation In which, applying premium regulations and discount rates are for each specific object - Complete regulations of each insurance operation, and add expansion terms to fit the actual needs of customers, especially for technical professional insurance, property insurance, fire insurance and marine insurance 3.3.2 Solutions to improve the quality of customer service - Develop solutions to provide uninterrupted and comprehensive customer service throughout the insurance term, from exploitation, evaluation, compensation to the valueadded services after the sale - Perfect the system of measuring customer satisfaction Customer satisfaction is subjective, so the measurement and evaluation of this criterion have met many difficulties But this criterion is important because enterprises’ final competitive goal is how to attract more customers through best meet their needs Therefore, the company should regularly through preliminary meetings, sum reviews of the internal, through handling and exposure to customers, evaluate customer perception of the company's services image, by conducting market research such as interviewing clients, industry experts, hiring the market research company - Perfect the monitoring system of risk management, prevention and loss limitation - Build and strengthen the network receiving the accident report, settlement of compensation Deploy system for receiving the accident report 24/24 standing - Set up hotlines or customer service center via phone to answer any questions and give advice to customers timely to all matters related to insurance products of MIC - Note the negotiations; reduce disputes with customers in court - Fast and accurate in handling compensation claims 3.3.3 Solutions to expand the distribution channel systems: - Insurance agents are very effective distribution channel Although during recent time the MIC developed network agents throughout the country, but network agent management didn’t perform well Agent management department didn’t operate effectively; have specific management plans, just statisticed the number of agents in the Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 48 Global advanced Master of Business Administration unit members and management of print, publication and implementation of training new agents Thus, to develop effectively a network of agents needs to conduct the following work:  Planning for managing agents: • Firstly, conduct a market survey to consider the possibility of establishing a network of agents • Carry out management plan: The plan must be close to avoid waste and to reduce the volatility of the company, and to help inspection and monitoring operation easy Specifically: determine the required planning of human resources to achieve planning revenue insurance in the near future, consider the organizational model agency network, evaluation plan, the form of award and punishment for agents Management plan must be specific to each unit member  Organizing agent management: • After planning the agent management, the unit members conduct directly their recruiting agents with the the company basic standards, regulations • After recruiting agents, MIC Training Center conduct training agent and certificating agency training • Requirements of the agent management is to analyze the job by listing all the work that the agent should perform, and to "assign work" through establishing the structure and deliverying for agents Organization selling insurance team by geographic area Because MIC has a nationwide agent network, the application of this organizational model will enable access market ability and promote the sale of insurance products And detect in time what the insurance product is better or worse in certain localities from which to plan to adjust the product accordingly  Executive agency network operation: the operator needs to create a favorable atmosphere creating opportunities and ability for agents to have adequate income and career advancement  Test and evaluate agency activities through specific targets: the premium revenue, number of new customers, productivity mining Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 49 Global advanced Master of Business Administration 3.3.4 Solutions to build brands and promote the image of the MIC: - The construction of images of the MIC and the MIC’s program ads to customers across the country have been conducted in recent years However, these activities is single, did not achieve high efficiency In this context, the MIC needs to strengthen sympathy, trust, reputation, engagement of traditional customers and potential customers in the future Ultimate goal of building brands and promoting the image of MIC is the customer can differentiate between insurance products of the MIC with insurance products of competitors Customers choose products of MIC and are loyal to the product of the MIC - To build a famous brand, MIC should have the following important factors:  Strong capital: expect to mobilize and increase capital to 500 billion VND in 2015  A healthy financial situation: Set up professional provision funds to ensure levels of safety and effectiveness Use idle funds to invest efficiently, diversify portfolio, focus on short-term investment securities Good management of debt situation and save up business operations cost  Team leaders: Boldly change leaders having poor qualifications and capability by the young, dynamic, highly qualified and capable management leaders Specificly to the member companies, exploiting department for two consecutive years had inefficient operations business, boldly change leader There are leaders circulated policy among member companies to facilitate leadership development for the full potential of their management and adapt well to changing business environment  Staff: Dynamic, highly qualified, experienced and have good moral qualities, good teamwork spirit, modern style of work  Revenue and market share are growing  High effectiveness of business activity 3.3.5 Solution of restructuring departments structure to improve business: - Specialize and classify clearly in the organization, from company headquarters to the branch members Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 50 Global advanced Master of Business Administration - Clearly define the responsibilities, powers and duties of each department to enhance the creativity and sense of responsibility of officials at all levels, avoidoverlap, push - Focus on developing business unit, consider the business as center of all activities, other parts have support and assist functions to business units to accomplish the objective - Rearrange the functional departments of Head Office and the member companies, particularly review qualified and evaluate capabilities of the leadership of member companies Executive Board must have bold decision in changing the poor qualified leadership by those who are highly qualified - At the headquarters of the MIC establish new departments:  Product Research and Development Department:  Research the needs of the market to make new suitable products  Build new product development process  Build plans for product development in year  Customer Care Department:  Information management program about customers through that, prompt and guide the member units to organize visit, give gifts during the holidays, birthdays, in preventing and limiting damage consultation  Research customer satisfaction  Staffs are highly qualified and practically experienced to answer questions and complaints from customers  Organize conference to receive customer feedback on the types of insurance products and their needs, guide and answer customers' questions  Loss precautions, limitation Department:  Develop programs to prevent, limit loss for the target customers  Regularly inspect the loss prevention and limitation of customers  Check the investigation of risks at the MIC staff at member units  Review and offer lessons on prevention and limitation of damages Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 51 Global advanced Master of Business Administration 3.3.6 Solutions to the administration of human resources and attracting talent of the MIC: Each enterprise must be able to recognize and take advantage of opportunities to appreciate and exploit its advantages, grasp the business environment, understand the psychology and the position of competitors Business success also requires a capacity for management, ie to define objectives and determine the number of resources put into operation Enterprises have many resources, in which human resources are fundamental elements, the decision to operate business Especially for insurance business, human resources management is more clearly neccesary:  Characteristic of the insurance industry is a service business so insured staffs are those who must have professional qualifications, knowledge and understanding of the issues of socio-economic and technical relating to the profession  Insurance products are abstract products, so the insurance business has many difficulties, especially during time of the introduction and launch new products into the market So the staff is professional capacity to reach customers Whether the introduction of new products is successful or not is due to the ability to choose the right people and deliver the right work of administrators  Insurance customers are very diverse and kind of insurance is very copious So the level of knowledge of the people on insurance is limited, the insurance business is difficult To account for customers to understand each type, insurance operations, help them to avoid confusion when selecting the insured, insurance officials not only have the necessary qualifications but also have practical experience  Pre-tax profits of enterprises are mainly from the use of idle funds to invest capital So we need to select employees who have professional qualifications in insurance and investments - Therefore, the MIC needs to develop human resource strategies to ensure to attract and use human resources effectively to fulfill the goals that the company intended Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 52 Global advanced Master of Business Administration - Recruit staff in the form of competition to select people who are qualified and good moral qualities The recruitment must be based on job requirements In these special cases can use the forms of admission to obtain the staff suitable job requirements - Have policies to attract talents from various sectors and fields to work for the MIC - Have adequate, fair treatment policy to workers and employees of the company, reasonable salaries to help employees work more productively and reduce the proportion of quiting to work for the other companies - Appropriately organize, assign staff with qualifications and capacity of staff to meet the strategic mission of the company, increase labor productivity - Main criterion for assessing the capacity of staff is efficiency and quality of work - Perform the rotation of leaders to create conditions for those who really are able to develop their capabilities - Attach special importance to training and updating knowledge to staff members through forms of election officials to participate in courses that focus at training facilities at home and abroad Especially in present fierce competitioms, any business making the kind of a high standard insurance to meet customer requirements in terms of risk assessment, objective prevention and limitation of damages, that business will recure customers and dominate market That shows the importance of MIC's staff who should have a high level of professional knowledge of insurance exploitment, insurance compensation techniques - With participation trends of more and more foreign companies in the Vietnamese market, it is indispensable insurance that activities communicating with abroad have increasingly demanding requirements in foreign language communication MIC should therefore concern about improve foreign language skills for officials and employees - Develop a staff of employees having sufficient qualifications, good moral and spiritual unity in business to make MIC more and more sustainably develop 3.3.7 Solution of information technology: - Activate information system of electronic customer management, e-commerce transactions system (busines - customer) for insurance products of motor vehicles, people, goods and other products when having conditions, the system e-commerce Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 53 Global advanced Master of Business Administration transactions (business - business) with the insurance business, financial services, banking, and other subcontractors - Promote brand, establish channels of communication with customers via the Internet and prepare the conditions necessary for electronic commerce - Consolidate and strengthen financial and accounting information systems, ready to expand, merge with financial and accounting information systems of member units - Activate information systems of insurance operations management (distribution contract/insurance policy, compensation and reinsurance) in the large scale member companies - Strengthen security system, expand the port connection 3.3.8 Solutions of expansion of financial investment activities: - Professionalism financial investment activities through the establishment of a MIC investment company - Diversify portfolio, not only investing in foreign currency markets but also in the future investing in real estate markets, both to use, both to business purposes, immediately focus in Hanoi, Ho Chi Minh and Da Nang - Invest in organizations who are MIC's customers in order to support mining insurance (the system of banks, credit institutions ) - Strengthen the review of the credit risk before and after the investment decisionmaking to ensure the safety of capital investment - Balance of cash flow generated from financial investing activities with demands of paying insurance to manage imbalance risk between assets and liabilities - Capital investment activities ensure according to three principles: safety, profitability and ensuring high liquidity Portfolio construction should focus on investing in short-term securities - The establishment of investment funds from the the operations reserve fund must be deducted for each type of insurance operations; the calculation of reserves has to be based on the original premium because it is the commitment of insurers 3.4 IMPLEMENTATION STRATEGY ROADMAP TO 2015 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 54 Global advanced Master of Business Administration  2010-2012 periods: during this period MIC should combine their strengths and take advantage of the opportunities created by the business environment to strengthen and overcome the weaknesses of the company Thereby, MIC will confirm its position in the customers’ mind; improve competitiveness to prepare for confrontation with foreign rivals MIC needs to focus on the following strategies: - Market entry, insurance product and services diversification strategy - Building a professional staff and modern management processes strategy - Marketing, broadcast strategy - Continuing to apply the system of advanced information technology in management  2013-2015 periods: continue to implement above strategies in order to maintain market share and to compete with rivals that are foreign insurance enterprises, MIC needs to take further the following strategies: - Promoting and diversifying investment activities strategy - Expanding and strengthening cooperation with domestic and foreign insurance and re-insurance partners 3.5 SOME PETITIONS: 3.5.1 For the Insurance Supervisory Authority: - Insurance business activities are not only affected by the Law on insurance business, but also influenced by other common law Thus Vietnam's legal system should complete and have high stability to facilitate insurance business activities particularly and other business activities generally - Insurance Supervisory Authority needs to take measures to manage and issue circulars guiding specifically to create equal business environment among enterprises - Insurance Supervisory Authority should strengthen management of all aspects of the operation of insurance companies; create a bridge of regular communication between the insurers and the State - Enhance training and dissemination of knowledge to people about insurance, complete construction of the system to provide ensuring customer information to all subjects related to insurance business Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 55 Global advanced Master of Business Administration 3.5.2 For the Association of Vietnamese Insurers: - Association of Vietnam Insurers performs the function as a bridge between the insurers with the State management agency on insurance business activities, maintains a healthy competitive environment and promotes economic cooperation between insurers - Association should expand the further operations; create links between the insurers to achieve a common voice - Association should promote its role in creating a healthy competitive environment and growing insurance environment 3.5.3 For Military Insurance Joint Stock Company (MIC): - The insurance industry is the service sector, invisible products, and insurance buyers not really want the insurance event occurred Insured customers expect MIC to solve insurance benefit quickly, timely, keep commitments to customers, create the most convenience for customers MIC should have strong capital, sound financial and business efficiency - Human is the most important factor in determining the success of the MIC MIC should therefore build a staff of officials and employees having high qualifications, good moral qualities and a strong collective and loyal solidarity to the MIC - MIC needs to strengthen and promote internal forces, combines to take advantage of external opportunities to overcome weaknesses and avoid the difficulties and risks that may occur, in order to implement the outlined strategies Especially MIC must regularly observe and adjust strategies to suit the vagaries of the market Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 56 Global advanced Master of Business Administration CONCLUSION With the continuous development of science and technology, material life of people is improved increasingly; people demand more and more needs in life, in which needs to be personal and business organizations safety in the special social are been interested MIC has been and will forever be places for customers’ peace of mind commend the safety of life and in business With the trend of international economic integration, Vietnam joined the regional and international economic organizations; most recently Vietnam has joined WTO These conditions created for the Vietnamese insurance company opportunities and equally difficult challenges, more and more foreign insurance companies will join Vietnam's insurance market, the competitive situation has been increasingly fierce Therefore, to keep loyal customers and increase market share, the MIC itself must be dynamic, creative, boldly change business style suiting the times MIC has to develop business strategies and select the best strategy, which is feasible and effective to implement Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 57 Global advanced Master of Business Administration REFERENCES - Griggs University, Strategic Management, Marketing management, operations management, Enterprise Finance, human resources management, Hanoi, 2010 - Ken Blanchard and Sheldon Bowles, The fans - the revolutionary method to serve customers (Vu Minh Tu translated) Youth Publishing House, Ho Chi Minh, 2006 - Quality Advisory Group - INNOVA Consulting Company, Introduce ISO 9001:2008, website: http://www.iso.com.vn/consultant.php?consultid=1&parent=1 - Nguyen Thi Le Hoa, ISO/IEC 27001 information technology - safety techniques - information security management systems - requirements, Thursday, 29/11/2007, website: http://www.nangsuat.vn/Article/read.asp - Robert Slater, Jack Welch and the GE way of leadership (Responsible publisher: Nguyen Xuan Thuy), Communications and Transport Publishing House, Thanh Hoa, 2005 - Thanh Binh, "ADB: 'Inflation this year will be at 10%", Tuesday, 13/4/2010, available at: http://vnexpress.net/GL/Kinh-doanh/2010/04/3BA1AC39/ - Thomas L Friedman, The World Is Flat (4 th edition, translation and editing team: Nguyen Quang A, Nguyen Hong Quang, Vu Duy Thanh, La Viet Ha, Le Hong Van, Ha Thi Thanh Huyen), Youth Publishing House, Ho Chi Minh, 2008 - MIC website: http://mic.vn/ - Military insurance JSC, the report summarizing the business in 2007, 2008, 2009 and 2010 - Vietnam Insurance Association, the insurance market statistics in 2007, 2008, 2009 and 2010 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 58 ... this report Nghe An, April 2011 Group – Class: GaMBA01.V03 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 vi Global advanced Master of Business Administration... options: .44 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 iii Global advanced Master of Business Administration 3.3 MEASURES OF STRATEGIC IMPLEMENTATION... 58 Business Plan for Military Insurance Joint Stock Company Perform: Group 8, class GaMBA01.V03 iv Global advanced Master of Business Administration LIST OF PICTURES AND DIAGRAM Content