Building development strategy of Nic human resource consultant joint stock company - period of 2013-2017

26 CHAPTER 2: STRATEGIC FORMATION BASIS ANALYSIS OF NIC HUMAN RESOURCE CONSULTING JOIN STOCK COMPANY .... - Using the analysis tools such as: Analysis of internal environment, external

GRIGGS UNIVERSITY MASTER OF BUSINESS ADMINISTRATION CURRICULUM

CAPSTONE PROJECT REPORT

BUILDING DEVELOPMENT STRATEGY OF NIC HUMAN RESOURCE CONSULTANT JOINT STOCK

COMPANY - PERIOD OF 2013-2017

GROUP 9

Le Hong Diep (Group Leader)

Vu Trong Tuan Nguyen Baa Long Tran Ngoc Hung Duong Van Tuan

Class: GAMBA M0111

HA NOI 11-2012

COMMITMENT

Members of Group 9 – MBA M0111 Class commits that the project:

“Building development strategy of NIC HUMAN RESOURCE CONSULTANT JOINT STOCK COMPANY during 2013-2017 period” is the subject chosen to

study by our group Data relating to NIC HR Consultant Joint Stock Company is provided by the NIC

Until the present time, this is the first time this subject has been studied Our

group’s members don’t have any conflict of interest in the company

Performance Members:

Le Hong Diep (Group leader)

Vu Trong Tuan Nguyen Ba Long Tran Ngoc Hung Duong Van Tuan

ACKNOWLEDGEMENT

We would like to deeply thank the NIC Human Resource Consultant Joint Stock Company for supporting us enthusiastically in data provision process as well

as meetings to make the business development strategy In particular, we would like

to sincerely thank Mr Than Van Hung, director of the NIC Human Resource Consultant Joint Stock Company for providing us with the data on the company, the data of the main competitors, the specialist data and contributed many ideas to help us complete this report

We also thank the most sincerely to professors, doctors of Master of Business Administration (MBA) by Griggs University in collaboration with ETC centre has dedicated teaching and guiding us throughout the training process This knowledge is necessary basic foundation to help us build this subject as well as applying to the practical work We also send a special thank to the University Griggs’s academic council for guiding us in the research implementation process

Performance Members:

Le Hong Diep (Group leader)

Vu Trong Tuan Nguyen Ba Long Tran Ngoc Hung Duong Van Tuan

CONTENTS

COMMITMENT 1

ACKNOWLEDGEMENT 2

CONTENTS 3

LIST OF SYMBOLS AND ABBREVIATIONS 5

LIST OF FIGURES AND CHARTS 5

LIST OF TABLES 6

LIST OF TABLES 6

INTRODUCTION 1

CHAPTER 1: GENERAL THEORETICAL BASIS OF BUILDING BUSINESS STRATEGY 4

1.1 Strategy and the role of strategic management 4

1.1.1 Definition of Strategic management 4

1.1.2 The role of business strategy 5

1.2 The strategic building process 5

1.2.1 Analysis of External environment 6

1.2.2 Analysis of competitors 14

1.3 Strategic analysis tools 17

1.3.1 External factor Evaluation (EFE) Matrix 17

1.3.2 Internal factor Evaluation (IFE) Matrix 19

1.3.3 Competitive Profile Matrix (CPM) 21

1.3.4 SWOT matrix 22

1.3.5 SPACE matrix 23

1.3.6 Decision period - Quantitative Strategic Planning Matrix (QSPM) 25

1.4 Building implementation roadmap and paying attention to the risks 26

CHAPTER 2: STRATEGIC FORMATION BASIS ANALYSIS OF NIC HUMAN RESOURCE CONSULTING JOIN STOCK COMPANY 27

2.1 General introduction about NIC Human resource Consulting Join Stock Company 27

2.1.1 Establishment and Development process of NIC Human resource Consulting Join Stock Company 27

2.1.2 Vision, mission and core values 29

2.1.3 Organization Structure of NIC Human resource Consulting Join Stock Company 30

2.2 Analysis of external environmental factors 34

2.2.1 Analysis of the macro environment 34

2.2.2 Analysis of the industrial environment of NIC 38

2.2.3 Analysis of competitors of NIC - CPM matrix 43

2.2.4 External response ability Evaluation of NIC with EFE matrix (External Faclor

Evaluation) 46

2.3 Analysis of internal environment of NIC 48

2.3.1 Tangible resources 48

2.3.2 Intangible resources 50

2.3.3 Core competencies of NIC 55

2.3.4 Analysis of sustainable competitive advantage origin 55

2.3.5 Response ability assessment and Internal factor Evaluation (IFE) of NIC 57

2.4 Summary of SWOT analysis of NIC 58

CHAPTER 3: PROPOSED STRATEGIC PLAN AND IMPLEMENTATION SOLUTIONS OF NIC HUMAN RESOURCE CONSULTING JOIN STOCK COMPANY – PERIOD 2013 - 2017 61

3.1 Forming business strategic plan for NIC Company 61

3.1.1 The strategic plans are formed from SWOT matrix 61

3.1.2 Analysis of SPACE maxtrix of NIC 62

3.2 Business strategy selection 64

3.2.1 QSPM matrix 65

3.2.2 Content of the selected strategy: 67

3.3 Some solutions to implement business strategies of NIC 69

3.3.1 Low cost strategy 69

3.3.2 Differentiation strategy 70

3.4 Strategic management roadmap and budget 71

3.4.1 Implementation roadmap 71

3.4.2 Implementation budget 73

CONCLUSION 75

LIST OF REFERENCES 77

LIST OF SYMBOLS AND ABBREVIATIONS

Figure 1-1: Strategic planning process 6

Figure 1-2: The determinants of competitiveness in the industry 13

Figure 1-3: Parts of the competitor analysis 14

Figure 2-1: Organization Chart of NIC 31

LIST OF FIGURES AND CHARTS Chart 2-1 Outsourcing market share allocation in Vietnam 41

Chart 2-2: Market share in headhunting 42

Chart 2-3: Online recruitment market share in Vietnam 43

Chart 3-1: SPACE Matrix of NIC 64

LIST OF TABLES

Table 1-1: EFE Matrix 18

Table 1-7: IFE Matrix 20

Table 2-1: Outsourcing Market share statistics Unit:million VND 40

Table 2-2 Market share in headhunting 42

Table 2-3: Analysis of some basic indicators between NIC and the competitors 44

Table 2.4: Analysis of direct competitors of NIC - CPM 46

Table 2-5: EFE matrix of NIC 47

Table 2.6: Economic indicators of NIC 48

Table 2.7 Training planning in 2011 51

Table 2-8: of sustainable competitive origin of NIC 56

Table 2-9: Internal factor Evaluation (IFE) of NIC 57

Table 2-10: Summary of SWOT analysis of NIC 58

Table 3-1: Caculating variables of SPACE 62

Table 3.2: To evaluate which plan is the most effective; we can look at the following contents: 65

Table 3-3: Strategy and applied market 67

Table 3- 4: Strategic implementation roadmap of NIC – Period 2013 – 2017 72

Table 3- 5: Strategic implementation budget of NIC – Period 2013 - 2017 73

INTRODUCTION

1 Reasons for topic selection

In every age and in every socio-economic and political form, people are always the center of the universe, human is always the priority of concerning matters

When human demands and other living conditions were highly satisfied, the importance of human resources is the concern of people

From the demands, since 2002, a number of enterprises operating in the field

of supplying, consulting the personnel solutions have played a small part in human

resources in Vietnam NIC Human Resource Consulting., JSC is one of them

NIC Human Resource Consulting., JSC (North Investment Consultant) was established in 2002 and operated in the field of providing HR outsourcing services such as:

Job consultancy and introduction, supply of the domestic labor and supply personnel restructuring service…

In the International MBA program from the University of Griggs United States with the topic: "Strategic Management", we - Group 9 - are assigned to perform a team work with a project associated with a corporation to apply the knowledge acquired during the training program in order to analyze and provide solutions on the enterprise strategic management For the above reasons as well as one member working in NIC Human Resource Consulting., JSC, members in Group

9 has agreed to select the topic: “Building the Development strategy for NIC Human Resource Consulting., JSC in the periods of 2013 – 2017” with the

expectation to contribute to the sustainable development of NIC Human Resource Consulting., JSC in the current trend of regional integration and globalization

2 Research objectives and applicability of the topic

- To systematize the problems of strategic management theory

- To analysis and assess of the company business situations in the context of the Vietnamese economy

- To support the company to identify their position in the market and then plan to build and implement other strategies for sustainable development

- To provide a number of strategic business solutions in the period 2013 - 2017

3 Research objects and scope

- Objects: Building the Company's business strategy of NIC Human Resource Consulting., JSC

- Scope: Within the framework of the training program and in the Vietnamese market in the period 2013 -2017

4 Research Methodology

Quantitative and qualitative methodology is used as follows:

- Using research methods on available materials (secondary materials) to examine the scope, structure and trends of the market

- Using the analysis tools such as: Analysis of internal environment, external environment, five competitive forces analysis, SWOT matrix, IFE matrix, EFE and

IE as lens to screen on the actual situations of the company operation to position the strategic status of NIC in the competitive environment

- Using various tools such as logical comparisons to build business strategy

of NIC to increase the competitiveness of the NIC in the Vietnamese market sector

5 Expected results

Helps NIC to recognize their relative position in the competitive environment and identify relationships of enterprise with stakeholders On that

basis, develop a general strategy to increase competitiveness and the owner value and be able to achieve above average profit

6 Layout of the topic

In addition to the introduction and conclusion, the project consists of three chapters:

Chapter 1: General theoretical basis of building business strategy

Chapter 2: Analysis of strategic formation basis of NIC Human Resource

Consultant Joint Stock Company

Chapter 3: Proposal strategy method and implementation solution of NIC

Human Resource Consultant Joint Stock Company during 2013 – 2017 Period

CHAPTER 1: GENERAL THEORETICAL BASIS OF BUILDING

BUSINESS STRATEGY

1.1 Strategy and the role of strategic management

1.1.1 Definition of Strategic management

Enterprises are normally formed and developed in accordance with certain rules, and a lot of companies were strongly developed but a lot of companies were failed and led to bankruptcy What are the problems? The answer is: in the same condition, enterprises which have good business strategies will be successful So what is the strategy? A strategy is simply a set of plans, methods and objectives in order to bring above-average profits or to create the competitiveness over the competitors The strategy is associated with the objectives that the company business and focused on planning to achieve those objectives A good strategy which is effectively implemented will help the managers and staffs at all levels to determine objectives, identify action direction, and contribute to the company success On the contrary, a company which has no any strategy and no orientation

direction of operation is like “a ship without a sail”

Although there are a lot of definitions of the strategy by the economists, each person based different viewpoints and aspects

In conclusion, the strategy can be defined generally as follows:

Business strategy is a series of commitments and actions that a company uses to win a competitive advantage by exploiting the core capacity in a certain market

The fundamental issues of business strategy

Business strategy to identify three basic issues:

* Who will be the object to be served?

* Which demand will be satisfied?

* How to satisfy above demands?

1.1.2 The role of business strategy

Business strategy help the enterprise to realize clearly their goals, objectives, direction which will serve as the premises and lodestar for all the business and production activities of the enterprise

Business strategy enables the enterprise to realize and capture all the business opportunities, as well as help the organization to have methods to proactively overcome all the threats on the competitive market

Business strategy is contributed to the enhancement of the efficiency in using resources, streghthen the competitive position of the organization to ensure the sustainable development of enterprises In addition, the business creates consistent base for the formulation of policies and business decisions in accordance with the market movements

1.2 The strategic building process

Strategy building process is a chain of activities including: analysis, hypothesis and the decisions and actions of an organization to be executed to achieve strategic and sustainable competitive advantages, with the maximum profits based on the limited resources

Figure 1-1: Strategic planning process

Source: Strategic Management, the authors: Le The Gioi, Nguyen Thanh

Liem-Statistics Publisher in 2009)

Strategy formulation process can be divided into four stages:

1.2.1 Analysis of External environment

1.2.1.1 Analysis on the macro environment: PEST model

PEST model includes factors: Politics, Economics, Social Culture and Technology PEST model is more and better and become an indispensable standard

when studying the external environment of the organization

Strategic function, mission and target of

enterprise (1)

Internal factor analysis

(S, W) (3)

External environment analysis (O, T) (2) Strategy selection (4)

Company level strategy (5)

Business level strategy and functional

department

Strategy implementation (6)

Check and evaluate the implementation results

Response Information

Political and legal factors

It describes the manner which the organization impacts on the stakeholders and vice versa

The following criteria can be considered:

- The stabilization: the stability of the political institution, safety and security

- Tax policy: taxation impact significantly on organization profits

- The relevant law: business law, labor law, antitrust law, investment law

- Policy: State strategic policies impact significantly on the organization

Economic factors

Status of the macro-economic environment to determine the health and prosperity of the economy always causes the impact on organizations and the industry Therefore, the organization needs to study the economic environment to realize the change in trend and its strategic implications

Economic environment shows the nature and direction of the economy in which the organization operates The economy impact on an organization can change the ability to create value and its income Four important factors should be considered carefully such as the economic growth rate, interest rates, exchange rates and inflation rate, the government's economic policies, the economic prospect in the future

Socio-cultural factors

Cultural values and social attitudes create the foundation of society so it often leads to the changes and technological, political, legal, economic and demographic conditions This leads to the formation of social and cultural social attitudes and cultural values Thus, the social and cultural changes also create opportunities and challenges

Technological factors

With the current boom development in terms of depth and width, environmental technology environment is important Technology segments include institutions, the activities are related to the creation of new knowledge, the knowledge transfer to the outputs, products, processes and new materials, the surge explosion of technology including creation and destruction, both opportunities and challenges

One of the most important effects of technological change is that it can affect the height of barriers to entry and reform the industry structure to the root

1.2.1.2 Analysis on industrial environment: 5 competitive forces model of Michael

E Porter

Competitive pressures of suppliers

The economist - M.E Porter mentioned about this issue in his book

"Competitive Strategy - page 64" as follows: The suppliers can show the bargaining

power with the buyers in the industry by threatening to increase prices or reduce the quality of your products/services Powerful suppliers can thereby squeeze profits in a sector if the selling prices cannot increased to compensate the cost increase

Suppliers can put pressures on organizations through a number of factors:

- Number of suppliers: The number of suppliers will decide the competitive pressure, their negotiating power with the sector and the organization If there are

only few large-scale suppliers in the market, competitive pressures are created and affected the entire industry's production and business activities

Scale of suppliers: Large-scale suppliers will have more advantages to customers

- Appropriate number of substitute products: Pressure of suppliers will increase if there are less appropriate substitutes

- The number of retail customers compared to number of large customers: Suppliers will put more pressured for retail customers

- Important factors of products of the suppliers to the customer success: If the products of suppliers are very important for the operation of the customers, the suppliers will put greater pressure

- The switching cost to replace the suppliers: The supplier will put a higher pressure if the cost to customers switching to use other products is relatively high

- The ability to penetrate the supplier to the customer's business: If the supplier has the ability to enter the field of customers, they will have put a higher pressure to customers

Competitive pressures from substitute products

Substitutes which are the products and services can satisfy similar needs for products and services in the industry

The threat of substitute products increases when:

- The quality and efficiency of the substitutes are better than current products

- Low switching cost for buyers to change the products

- Lower price of substitute products

- Special products with high appreciation of the customers are less impacted

by this threat

Competitive pressures from customers

M.E Porter “Competitive Strategy” - page 60: Customers compete with the industry by price reduction, bargaining higher quality and more services and force competitors to compete with each other All of which causes the reduction of the industry profitability

Customer's power will increase when:

-Buying huge amounts comparing to sales of the seller

- Products or services purchased from the industry accounts for a large proportion of the cost or the total procurement of the customers

The customer is a competitive pressure which can directly affect the entire production and business activities of the industry

- Products have no distinct characteristic

- The switching cost for customers is low

- Customers have low margins

- Buyers have the ability to entry the industry of sellers

- Products of the industry are not important for product and service quality of the customers

Competitive pressures from potential competitors

According ME Porter, potential competitors are not currently present in the industry but can affect the industry in the future

- The new entrants will have new production capacity, expectation of market share resulted in price reduction and cost increase which leads to profit reduction

Diversified companies often use their available resources

More or less potential competitors, their strong or weak pressures depend on following factors:

Barriers to entry: economies of scale, the cultural characteristics of the products, capital requirements, switching costs, access to distribution channels, cost disadvantages independent of scale, government policies

- The reaction of existing competitors

- Price barriers to entry

- Barriers to entry due to experiences and scale

Competitive pressures from internal industry

Enterprises operating the industry will compete directly with each other to create pressure on the industry and leads to create a competitive intension The competitive intension in the industry will increase when:

- High strategic interests: The competitors try to survive in the market

- There are many competitors or competitors with similar power

- High fixed costs or high storage costs: It is difficult to be able to switch to other fields or other products

- Difficult to have the opportunity to make differences or have low switching costs: The competitors are similar on operation methodology, products, prices, after-sale services

- Sectors with slow growth or downturn: The competitors try to increase their competitiveness to survive

- Exit Barries: Same as the barriers to entry, exit barriers are factors which make the withdrawal from the industry becomes more difficult (barriers of technology, capital; constraints to labors and governments, relevant organizations; strategy and plan constraints)

Analysis on Industry environment

A group of organizations providing products or services can substitute closely together referred as an industry

In that sector, organizations compete to each other to make above-average profits Industry environment analysis can clarify the following issues:

- The economic characteristics of the industry and its attractiveness

- The competitive forces in the industry

- The driving force that causes a change in the industry

- Sup-group the organizations in the industry

- The forces affecting the movement in the industry

The managers can not establish a long-term orientation or a strategic decision

if they do not have a deep understanding of the strategic situation of the organization

The nature of competitive conditions that the organization has to face and the approaches is to create the match between resources and capabilities with those conditions

Michael E Porter - Professor of Harvard University had founded the competitive forces model as follows:

Figure 1-2: The determinants of competitiveness in the industry

(Source: ME Porter, Competitive Strategy)

Five forces in this model are:

Therefore this model is the five competitive forces, including:

Buyers Suppliers

Substitutes

Threat of new entrants

Threats of Substitute products/services

Bargaining powers of buyers

Bargaining powers of suppliers

1.2.2 Analysis of competitors

According to the Economist ME Porter: "Competitive Strategy - page 86":

Competitive strategy requires positioning in order to maximize the organization value to make the differences to other competitors Therefore, the center of strategic

The goal of the competition analysis is to understand the preliminary on the competitors and develop an entry or defense strategy or corporate with existing competitors

According M.E.Porter, analysis of competitors includes 4 parts :( see Figure 1.5) future goals, current strategy, assumptions and capabilities

How the organization competes?

THE RESPONSE OF COMPETITORS

Are the competitors satisfied the current position?

What Changes of actions or strategies will the competitors perform?

How is the competitor vulnerable?

What makes the competitors retaliaze in strongest and most effective way?

ASSUMPTIONS

About the industry itself

CAPABILITIES

Both strengths and weaknesses

Figure 1-3: Parts of the competitor analysis

Future goals

The determination of the competitors’ goal, or in other words, studying the way that the competitors assess the target completion level is extremely important Knowing the goal of competitors helps the organizations to forecast its response to strategic changes

* The target can be at least as follows:

- The financial targets

- The belief or economic or non-economic values

- The organizational structure of the competitors

- Competitor’s attitude to risk

- System and encourage control system

- The accounting system

- The agreement level of the leadership and management

- The capacity of leaders and managers

- Management board structure

- Limited or extended commitments and contracts

- The limitations of government, the law against competitors

- The limitations and constraints supported by the parent organization

- Analysis of competitor’s goals and targets

- The goal of the competitors and strategic positioning

Assumptions

These assumptions include two groups:

The assumption of competitors itself

The assumption of the competitors and other organizations in the industry

Questions about the assumptions of the competitors can be:

- Competitors believe about its relative position?

- Competitors have the history or a strong connection to the product or design, geographical location, production, sales methods or not ?

- Competitors have cultural, regional or country tastes or not?

- Competitors have standard values or organization values or not?

- Competitors believe in future demands of the product and about the significance of the trends in the industry

- How the competitors assess the competitive capacities of other competitors?

- Do the competitors believe in core values?

- Are the competitors’s assumptions feasible and objective?

- Background knowledge and experience of leaders and consulting relationships

Current strategy

Analysis and evaluation the current strategy is extremely important The strategy of a competitor is operation policies, especially on business functions and the connections among those functions

The strategy can be public or privated or both types

Capacities

M.E Porter, Competitive strategy: Actual appraisal of competitors’s

capacities is the final forecast in competitors’ analysis Current objectives and assumptions and strategies will impact on the time, nature and intensions and possibilities of competitor’s response The strengths and weaknesses will decide the implementation capabilities and response to the strategies and deal with the possible events in the industry or surrounding environment

Analysis on capabilities of the competitors, some issues need to be noted:

- Core capabilities

- Growth capabilities

- Quick response ability

- Adaptation ability with change

- Durable strength

- Attack ability

- Self-defense ability

1.3 Strategic analysis tools

1.3.1 External factor Evaluation (EFE) Matrix

EFE Matrix is to assess the external factors, generate and sumarize the primary opportunities and threats affecting the organization’s operation to help the managers to evaluate the response level of the organization with the opportunities and threats and provide the views of external impact factors as opportunities or threats for the organization In order to use this matrix, 5 following steps should be implemented:

Step 1: Make the list of 10- 20 factors of main opportunites and threats affecting the success of the organization in the industry or the business field

Step 2: Clasify the importance score from 0.0 ( Not important) to 1.0 ( Very important) for each factor The important score for each factor depends on the impact level to the industry/business field which the organization takes part in Total importance score should be equal to1.0

Step 3: Determine the weight from 1 to 4 for each factor, weight of each factor depends on the response level of each organization with each factors, 4: the best response, 3: above-average response, 2: average response, 1: weak response

Step 4: Multiple the importance score of each factor with the weight to determine the scores of each factor

Step 5: Plus total scores of factors to determine the total scores of the matrix

Evaluation: Total score of the matrix indepents on the scores of factors in the matrix, 4 is highest score and 1 is lowest score

 If the total score is 4, the responses of enterprise with the opportunities and threats is good

 If the total score is 2.5, the organization’s responses with the opportunities and threats is average

 If the total score is 1, the organization’s responses with the opportunities and threats is weak

Table 1-1: EFE Matrix

Score for evaluating the response abilities

of the organizations with the environment changes

Conversion scores

Explanations of this table:

Column No II: external factors have impact to the organization for

Column No V: Converted score from column III multipled with column IV

Total converted score of factors from 1 to n, total score have distance from 1→4

Total converted score is 4: the response of the organization to the threats is good

Total converted score is 1: the response of the organization to the threats is weak

1.3.2 Internal factor Evaluation (IFE) Matrix

In order to use this matrix, 5 following steps should be implemented:

 Step 1: Make the list of 10- 20 factors of main opportunites and threats affecting the success of the organization in the industry or the business field

 Step 2: Clasify the importance from the score 0.0 ( Not important) to 1.0 ( Very important) for each factor The important for each factor depends on the impact level to the industry/business field which the organization takes part in Total scores of importance should be equal to1.0

 Step 3: Determine the weight number from 1 to 4 for each factor, weight number of each factor depends on the response level of each organization with each

factors, 4: the best response, 3: above-average response, 2: average response, 1: weak response

 Step 4: Multiple the importance figure of each factor with the weight number

to determine the scores of each factor

 Step 5: Plus total scores of factors to determine the total scores of the matrix Evaluation: Total scores of the matrix from 1 to 4, is not dependent on the numbers of important factors in the matrix

 If the total score is below 2.5, the internal environment is weak

 If the total score is over 2.5, the internal environment is strong

Table 1-7: IFE Matrix

Score to evaluate the reorganization ability of the enterprise to the environment

Conversion scores

Explanations of this table:

Column II: internal factors have impact to the organization for consideration

Column III: Importance level converted to the score of internal factors chosen to examine, this weight is generated as 1

Column IV: Scores for evaluation the response of the organization with the impact of internal environment

Column V:Score converted from column III multipled with column IV

Total converted scores of factors from 1 to n, total score have distance from 1 → 4

Total converted score is 4: the response of the organization to the threats is good

Total converted score is 1: the response of the organization to the threats is weak

1.3.3 Competitive Profile Matrix (CPM)

Competitive Profile Matrix is formed to give out comparison between an enterprise with its major competitors in the industry The comparison is based on factors affecting the competitiveness of enterprises in the industry It helps managers recognize the strengths and weaknesses of the enterprise compared to its competitors, define its competitive advantages and weaknesses needing to be overcome There are five steps to form a Competitive Profile Matrix:

Step 1: Listing about 10 key factors having strong influence on the competitiveness of enterprises in the industry

Step 2: Assigning a weight from 0.0 (not important) to 1.0 (very important) for each factor The weight of each factor depends on its influence on the competitiveness of enterprises in the industry The total weighted score of all factors must be equal to 1.0

Step 3: Assigning a rating from 1 to 4 for each factor The rating of each factor depends on the enterprise’s response to each factor, in which 4 is superior, 3:

above average, 2: average, 1: poor

Step 4: Multiplying the weight of each factor with its rating to find out the weighted score of each factor

Step 5: Adding the weighted score of all factors to find out the total weighted score of the matrix

Evaluation: Comparing the total weighted score of the enterprise with its major competitors in the industry to evaluate its competitiveness

1.3.4 SWOT matrix

SWOT is included: Strengths, Weaknesses, Opportunities và Threats This is

a very useful tool to find the problems and making decisions in the organization and management as well as business operation In the other words, SWOT is the theory framework that the strategy can be examined and positioning the status and directions of an organization, a company and analysis business proposal or any ideals related to organization’s benefits Actually, using SWOT in business planning, strategic planning and competitor evaluation, market survey, product development and in the research study is chosen by a lot of companies

SWOT analysis provides for the organization as follows:

Figure: 1- 4 SWOT Matrix

Weaknesses (W)

List the most weaknesses

from the table generated the internal environment

Opportunities (O)

List the most opportunities

from the table generated

the external environment

S -O

Utilize strengths to exploit opportunities in external environment

W - O

Utilize opportunities to overcome weaknesses

Theats (T)

List the most threats

from the table generated

the external environment

1.3.5 SPACE matrix

The strategic positioning and performance assessment matrix SPACE is a common tool used to select the general strategies SPACE matrix shows a business which strategy should be chosen: Attack, cautious, Defense, and Competition SPACE matrix is represented on a two-axis model One axis of SPACE matrix describes two assessment criteria of internal environment which are financial strength (FS) and competitive advantage (CA) The other axis describes two measures of the external environment which are environmental stability (ES) and industry strength (IS)

Steps to follow when building SPACE matrix:

(1) Select group of variables reflecting financial strength (FS), competitive advantage (CA), environmental stability (ES) and industry strength (IS) (2) Assign specific values to each dimension of the matrix, specifically: determine from +1 (worst) to +7 (best) to variables reflecting financial strength (FS) and the strength of sector (IS); -1 (best) to - 7(worst) to variables reflecting environmental stability (ES) and competitive advantage (CA)

(3) Calculate the average score that reflects the strength (FS), the strength of the sector (IS), environmental stability (ES) and competitive advantage (CA) by adding the values assigned to the variables of each aspect and then dividing them by variables of the corresponding aspect

(4) Mark the average score of FS, IS, ES and CA on the appropriate axis of the SPACE matrix

(5) Add the 2 scores of the horizontal direction and mark the result on the horizon axis Add two scores of the vertical direction and mark the result on the vertical axis Mark the intersection of the two new points on the XY axis (6) Draw a vector starting from the origin of SPACE matrix through the new intersection This vector represents kind of the business strategy that company should pursue: attack, competitive, defensive or cautious

1.3.6 Decision period - Quantitative Strategic Planning Matrix (QSPM)

After analyzing in many aspects, the organization decided to the strategy formulation, gathering discussion opinions to provide feasible strategy selection

The establishment for implementation is to determine the detailed tasks to answer for the questions: who will perform the tasks? Staring time and finishing time, cost and funding?

The establishment for implementation will help the organization to control the schedule and results of each strategic period and then be able to adjust appropriately with the strategic objectives and resource distributions in an active and effective way

Finally, forecast the unexpected risks of a strategy help managers to have the solutions for the unexpected situations

1.4 Building implementation roadmap and paying attention to the risks

After establishing the business-level strategy, compartitive strategy and other functional strategy such as: marketing strategy, production strategy, financial strategy, strategic human resource management .the organization has design and control system needed to have establishement of implementation

The establishment for implementation is to determine the detailed tasks to answer for the questions: who will perform the tasks? Staring time and finishing time, cost and funding?

The establishment for implementation will help the organization to control the schedule and results of each strategic period and then be able to adjust appropriately with the strategic objectives and resource distributions in an active and effective way

Finally, forecast the unexpected risks of a strategy help managers to have the solutions for the unexpected situations

CHAPTER 2: STRATEGIC FORMATION BASIS ANALYSIS OF NIC HUMAN RESOURCE CONSULTING JOIN STOCK COMPANY

2.1 General introduction about NIC Human resource Consulting Join Stock Company

NIC is a small and medium enterprise, business in the field of providing human resource solutions, provides many advanced tools for the fledgling market in Vietnam NIC was established 10 years specialized in narrow fields but it is one of the famous and also leading companies in the industry, accounting for high market share in the industry NIC has development revenue, but profit is not high, there is not almost the strategic competitive system and functional strategy NIC has identified mission and core values

2.1.1 Establishment and Development process of NIC Human resource Consulting Join Stock Company

NIC Human resource Consulting Join Stock Company was established under business license No 0101269511 issued on 21/07/2002 by the Department of Planning and Investment of Hanoi

- Vietnamese name: Công ty CP Tư Vấn Nhân Lực NIC

- English name: NIC Human resource Consulting Join Stock Company

- Abbreviation: NIC HR , JSC

- Head Office: No 7 Alley 53 lane 322 Le Trong Tan stress, Qiang Mai ward, Thanh Xuan District, Hanoi

- Transaction Office Address No.1: No 27 Le Ngoc Han Street, Pham Dinh

Ho ward, Hai Ba Trung District, Hanoi

- Transaction Office Address No 2: Third floor, Gemandept Building, No

108 Lo Duc Street, East Score Ward, Hai Ba Trung District, Hanoi

- Ho Chi Minh Branch: No 7, 19 street, Binh An Ward, District 2, Ho Chi Minh City

- Website : www.nicvn.com / tuyendung.com.vn

- Tax code : 0101269511

- The local currency account: 0011 000 260 157

- Currency Account number: 0011 370 450 677

- In Exchange of Joint Stock Commercial Bank for Industry and Trade of Vietnam

- Charter capital: 10 billion

- Number of members: 4

- Main business industries:

Headhunting service is for corporations, large domestic and foreign companies This is a service to help enterprises find and recruit the most suitable candidates to meet the demand for capacity improving of human resources in the enterprise The company's database has over 30,000 records with different levels to ensure the ability to provide HR services to customers in the shortest time

Temporary Staffing & Contract employment service: This service of the Company meets the urgent needs of the large, domestic and foreign units about the need to use seasonal workers or additional workers for their activities without human-scale changes

Online recruitment service in website: www.tuyendung.com.vn with more than 30,000 registered participants This online recruitment network provides users with the most effective tools for online recruiting and job searching and helps employees to register records so that employers can search It can be said that online recruitment network is link between employers and job seekers through which they have most appropriate choices for their work

Payroll and Tax return Services: This service helps customers minimize the unnecessary bureaucratic works to focus on their core business areas

Until now, NIC., HR JSC has become one of the leading Vietnamese units

in the field of providing human resource solutions with staff including consultants, professional and experienced management staff, and collaborative networks is the leading experts ready to meet the best requirements of customer

- Icon:

- Motto: We care your career

2.1.2 Vision, mission and core values

Vision of the NIC:

By 2020, it become a leading economic groups in the country, always in the top 3 leading company in the field of human services (including online recruitment service) with minimum annual turnover of 100 million U.S Dollars

The mission of the NIC:

Provide economical solutions for enterprises With output targets: "Effective

management, maximum saving", NIC is synonymous with high quality,

cost-saving, time-saving and labor saving

Particularly in the field of human resource solutions providing, with the concept of human resources is the most valuable asset of the enterprise, NIC

associated with the mission: "Increased HR assets for enterprise"

 Computerization of operations that is processed according to ISO 9001-2008 standards, and continuous improvement on the basis of practical experience and innovative research

 Always promote solidarity, initiation, creativity and responsibility of the members of the organization

2.1.3 Organization Structure of NIC Human resource Consulting Join Stock Company

Organization structure of the NIC horizontally: the functional structure

Organization structure of the NIC vertically: 3 level

Control system of NIC is a system of financial and quality control at management level

Organization and control structure of NIC (see Figure 2-1):

ORGANIZATIONAL CHART NIC HUMAN RESOURCE CONSULTING JOIN STOCK COMPANY

(NIC HR., JSC.) 01/01/2012

Figure 2-1: Organization Chart of NIC

(Source: Data from HR Department of NIC)

BOARD OF DIRECTORS

QUẢN TRỊ

VICE GENERAL DIRECTOR Le Hong

GENERAL DIRECTOR - Than Van Hung

ASSISTANCE

VICE GENERAL DIRECTOR Le Minh Loan

HR consulting staff

E commerce staff

-HR Administrat ive staff

Outsource staff

Head of HR consulting

Specialist Tuyển dụng

Head of electronic commerce

IT manager

E commerce group leader E- commerce specilist

-Designers

HR manager

Recruitme

nt Human

Labor managem ent group leader

Protocol/

administr ation assistan

ce Driver

Guard Labor

managem ent staff Outsource

Vice head of Department (Phụ trách HC)

BG Vocational training center

Business development component

Sales &

Marketing employee

Odd job

Specialist

Tư vấn NS

- Board of director: is the highest decision-making agency, the Board of Director meets twice per year or having extraordinary meetings according to regulation Board of Director works on the principle of combining leadership of collective with the management and coordination of the Chairman of the Board and upholds the responsibilities of each member

- Chairman of the Board is Mr Than Van Hung with a capital contribution of 40% that is representative of the law

- Board of Directors: Leader of Board of Directors is by Mr Than Van Hung with the position of General Director who has direct vice general manager and direct PR & Marketing Department and its subsidiaries, representative offices and technology department

Two vice general director direct the Departments:

+ Deputy Director 1: In charge of Department of Payroll & HR Staffing, HR Consulting, Electronic Commerce

+ Deputy General Director 2: In charge of accounting finance

- The professional departments consist of 8 departments:

+ Financial Department: 12 people

+ HR consulting Department: 28 people

+ Electronics Ecommerce Department: 6 people

+ HR Administrative Department: 13 people

+ PR and Marketing Department: 5 people

+ Payroll and Staffing Department: 35

+ Information technology Department: 9 people

+ Ho Chi Minh Branch: 15 people

Total employees of NIC are 123 people in whom master and universities’ degree are 13 and 99 colleges and the rest are unskilled workers

Products and services of the NIC:

* NIC’s products include 4 service options are: 1) Senior recruitment consulting Services, 2) Recruiting posting services and e-commerce through online Recruiting website that is tuyendung.com.vn, 3) payroll and income tax Services, 4) Labor lease and Management services

Customers also are classified by industry:

Customers are manufacturing companies

Customers are high-tech companies

Customers are the representative offices

Customers are retail companies

Some typical customers that NIC are supplying: