BUSINESS STRATEGY OF THE HOUSING AND URBAN EVELOPMENT CORPORATION (HUD) IN VISION OF DEVELOPING THE MODEL OF VIETNAM REAL ESTATE GROUP

BUSINESS STRATEGY OF THE HOUSING AND URBAN EVELOPMENT CORPORATION (HUD) IN VISION OF DEVELOPING THE MODEL OF VIETNAM REAL ESTATE GROUPKEY THEORETICAL BASIS FOR BUSINESS STRATEGY FORMULATION OF THE HOUSING AND URBAN DEVELOPMENT CORPORATIONEVALUATING THE REALITY OF BUSINESS STRATEGY FORMULATION TASK AT THE HOUSING AND URBAN DEVELOPMENT CORPORATION SOLUTIONS TO IMPROVE HUD’s STRATEGY FORMULATION TASK

BUSINESS STRATEGY OF THE HOUSING AND URBAN EVELOPMENT CORPORATION (HUD) IN VISION OF DEVELOPING THE MODEL OF VIETNAM REAL ESTATE GROUP CONTENT PAGE INTRODUCTION CHAPTER 1: KEY THEORETICAL BASIS FOR BUSINESS STRATEGY FORMULATION OF THE HOUSING AND URBAN DEVELOPMENT CORPORATION .7 1.1 Concepts of business strategy .7 1.1.1 Definition of a business strategy 1.1.2 Strategic management process 1.1.3 Necessity and the role of a business strategy 11 1.2 Substances in enterprises’ business strategy formation 14 1.2.1 Defining duties and objectives of the enterprise 14 1.2.2 SWOT Analysis 15 1.3 Business strategy implementation 29 1.3.1 Objectives, conditions of the business environment and the selected strategies 29 1.3.2 Organize the implementation apparatus 29 1.3.3 Allocation and adjustment of resources 30 Page 1.3.4 Set up a plan of implementation .31 1.3.5 Designing strategy’s structure and control system 31 1.4 Monitoring and Evaluation (M & E) 34 CHAPTER 2: EVALUATING THE REALITY OF BUSINESS STRATEGY FORMULATION TASK AT THE HOUSING AND URBAN DEVELOPMENT CORPORATION (HUD) .36 2.1 General features of the Corporation 36 2.1.1 Establishment and development process of the Corporation 36 2.1.2 Features of Corporation’s business operation 37 2.2 Current situation of business strategy formulation of HUD 45 2.2.1 Objectives and philosophy in business strategy of HUD 45 2.2.2 The process of corporate strategy formulation 47 2.2.3 The Corporation’s corporate strategy formulation method 50 2.2.4 Implementation organization 50 2.2.5 The Corporation’s business strategies 53 2.3 Remarks on HUD’s business strategy formulating 75 CHAPTER 3: SOLUTIONS TO IMPROVE HUD’s STRATEGY FORMULATION TASK .77 3.1 Strong points, weak points, Opportunities, Challenges in the HUD Corporation’s business strategy formulation task 77 3.1.1 Opportunities 77 3.1.2 Challenges .78 3.1.3 Strong points 79 3.1.4 Weak points 80 3.2 Several solutions by HUD’s Leadership Board to improve its business strategy formulation task 80 3.3 Some suggestions and recommendations to improve HUD’s business strategy formulation task 82 Page CONCLUSION 91 REFERENCE 93 INTRODUCTION Necessity and meaning of HUD’s business strategy formulation Our economy is operating on a state-regulated market regime and has been increasingly integrating into that of the region and the world To ensure successful economic integration, the first responsibility is laid on the shoulder of enterprises Stemming from that reality, each enterprise is required to build their business strategies that are closely linked to international integration A precise business strategy plays a decisive role in the success of an enterprise, guiding the enterprise toward a sustainable development in the market economy regime A business strategy also helps members of the enterprises be well-aware of the aims and direction of their enterprise so that they can clearly figure out what and how they should Besides, business strategies facilitate the enterprises to timely grasp and utilize the opportunities as well as minimize the risks due to upheavals in the business environment The Housing and Urban Development Corporation is among the leading brand names in the area of housing and urban development With its 20 year experience of operation and development, its status is increasingly consolidated and enhanced in domestic and foreign markets Currently, the company is operating under the model of parent-subsidiary companies with the parent company as the state-owned Page enterprise operating in line with the Law on Enterprises and 16 subsidiary companies including 15 joint-stock companies, state-own limited one member company and 11 affiliates To ensure the company’s sound development in the future, the urging issue to be addressed is that it should be able to build a stable and long-term business strategy that is flexible upon the ups-and-downs in the business environment; develop the company into a cooperation to meet increasing needs for housing and urbanization, thus contributing to the nation’s cause of industrialization and modernization Over the past years, HUD has set up an appropriate business strategy, thus enabling it to have solid developments However, improving business strategy formulation to develop the Company into a strong Cooperation in the area of housing and urban development is a matter of strategic importance, especially against the backdrop of our economy’s deeper integration into the world’s Therefore, our group has chosen the issue of “Business strategy of the Housing and Urban Development Corporation with linkage to the construction model of a Vietnam’s Real Estate Group” to be the grand exercise for the graduation of the Master of Business Management Program Exercise’s objectives and responsibilities a Objectives Studying the matters of theoretical and practical manner as well as evaluate the reality of the Company’s business strategy formulation in order to suggest solutions for improving the business strategy formulation task to serve as a basis for turning the Company into a real-estate business group b Responsibilities - Studying theoretical matters on business strategy formulation within the enterprises - Analyzing the business strategy formulation current situation at the Housing and Urban Development Corporation Page - Proposing solutions to improve the business strategy formulation task at the Housing and Urban Development Corporation as the basis for the establishment of a national group operating in the field of housing and urban development Exercise’s subject and scope of study - The exercise’s object of study is the business strategy formulation task in enterprises - The exercise’s scope of study is to focus on studying the business strategy formulation task at HUD during the period of 2009-2010 and its development orientation to 2015 Practical issues of the exercise that may contribute to the Company’s business strategy - Systematizing some theoretical issues relating to the business strategy formulation of enterprises that can be used as reference materials for business strategy formulation task for enterprises - Contributing to helping HUD map out fundamental orientation in the process of analyzing and evaluating the business strategy formulation current situation at the Company, through which shortcoming and their origins can be found out - Helping improve the business strategy formulation task at HUD, thus contributing to the formation of a development strategy to set up Vietnam’s Housing and Urban Development Group Exercise’s structure The exercise is divided into chapters: Page Chapter 1: Key theoretical basis on the Corporation’s business strategy formulation Chapter 2: Evaluation of the Corporation’s business strategy formulation task Chapter 3: Solutions to improve the Corporation’s business strategy formulation task Page CHAPTER KEY THEORETICAL BASIS FOR BUSINESS STRATEGY FORMULATION OF THE HOUSING AND URBAN DEVELOPMENT CORPORATION 1.1 Concepts of business strategy 1.1.1 Definition of a business strategy So far, there have been many definitions of a business strategy, among which these two following ones are most popular: - A business strategy is a plan of projecting and controlling business activities of the enterprise including identifying the objectives of the business strategy (3 years, years, 10 years etc); decision-formulation process of the enterprises and analysis of the business environment In other words, the business strategy is a “product” that can be combined with what the environment has; what the Company may have; and what it wants to have Therefore, the nature of a business strategy is the means toward long-term objectives and the ideas of a business strategy is the aim of winning in competition and business market - A business strategy is a set of long-term objectives, policies and grand solutions on business and manufacture; finance; as well as human factors in order to bring the enterprise’s business into a new height with higher quality 1.1.2 Strategic management process The concept of management have long come into being, however, it is not until the end of XIX and early XX centuries that theories of management including ideas and thoughts systematized and studied based on scientific analysis did appear with the school of scientific management and the newly released school of quantitative management to fit with the need for competitiveness in modern business activities Page Strategic management is a process of studying the environment to form strategic objectives, policies and solutions for enterprises’ business; to put these business policies and strategies into practice so as to make decision on adjusting, monitoring and evaluating the implementation process of these business policies and strategies 1.1.2.1 Strategy formation period Strategic formation is a process of setting up business duties, implementing study and research to identify inner and external factors, outlining long-term objectives and selecting alternative strategies This strategy formation period is sometimes called “strategy plan-formulation” Strategy formation involves fundamental activities: - Conducting studies relating to the collection and digestion of data and information on the market and business sectors of the enterprise This process is called “having a glance at the business environment” In essence, conducting this study is to define important strengths as well as weaknesses in the functional business area Different forms of surveys may be developed and conducted to study inner factors i.e staff’s spirit, production efficiency, advertising effectiveness and customers’ loyalty - Combining intuition and analysis: several administrators and enterprises’ owners think that certain particular gifts may count in using intuition for initiating excellent strategies Although some organizations nowadays can survive and prosper thanks to intuitive geniuses in management, the majority might not be as so lucky Most organizations can, instead, make benefits by combining in tandem between intuition and analysis in decision formulation - Decision formulation: since no organization can have unlimited resources, strategists ought to make decision as to what alternative strategy should be selected to bring most benefits to the company Decisions during the strategy formation period should link the organization with the products, markets, resources and specific technologies within a prolonged period Page 1.1.2.2 Strategy implementation period - Strategy formation is usually deemed the period of actions of strategic administrators Implementation implies the mobilization administrators and staffs to carry out the set strategies Fundamental activities in this period include: - Setting up annual targets: i.e landmarks that organizations have to fulfill toward longer-term objectives Annual targets should be measurable, quantitative, challenging and prioritized These targets are normally set at the company, section and functional office levels in a big company They should be released under the form of achievements in management, marketing, finance, accounting, operation, and information R&D A series of annual targets is needed for each long-term objective These annual targets are extremely important in the strategy in the sense that they are the basis for resource distribution - Policies: policies are means toward ends They include instructions, regulations and procedures given out to support efforts toward the set targets Policies are the guidance for decision-formulation and reflect repetitive or periodic situations Policies as well as annual targets are of great importance in strategy implementation as they cover expectation of the staff and administrators in the organization Policies also enable cooperation and inner synchronizing among different departments within the organization - Resource distribution: this is a central administrative activity taking into account the strategy implementation Strategic management allows resources to be distributed according to priorities set by annual targets Nothing should be more harmful to the strategic administrative process and the organization’s successes than the fact that resources are distributed in an inappropriate ways against the priorities that have been adopted in annual targets All organizations have at least categories of resources that can be used for achieving the targets: + Financial resources; Page + Material resources; + Human resources; + Technological resources In short, the strategy implementation period is the most difficult one It requires discipline, devotion and sacrifice from each individual A successful implementation of strategy depends on the administrator’s capability to mobilize staff, usually deemed as an art rather than a science A strategy which has been set but cannot be implemented will not serve any useful objective 1.1.2.3 Strategy evaluation period Most strategic makers agree that strategy evaluation period is essential to bring prosperity for the organization Timely evaluation can raise an alarm for administrators about obstacles or warn possible obstacles before a situation becomes serious Timely and fully responsive information as the foundation for strategic evaluation may be nothing different from current available information So much pressure from leading administrators may render lower-level ones to figure out data that they think will satisfy the higher-level Although one or many strategies may be right, however, this kind of theoretical thinking may be wrong in that strategic evaluation embraces both short-term and long-term objectives Normally, these strategies not affect short-term activity outcomes until it has been so late to make necessary changes It can not be verified that a typical strategy is the best or guaranteed that it can act Nevertheless, it can be evaluated through serious mistakes Richard Rumel has suggested criteria for strategic evaluation, namely consistency, suitability, favorableness and feasibility Strategic management process Including: Commitment → Decision → Action Page 10 market or pause their project, thus, the property market will be decreased, the number of transactions will be deducted, result in the confusion and diversion of the Corporation’s managers The need of high quality accommodation is increased day by day due to the development of the economy The people’s income increases however the competition of the market also increases, thus, designs of the high class accommodations are expected to apply the new technologies, new architecture styles but low price There are many inadequacies in the Government’s mechanism, policy for the real estate commerce field, difficulties with regard to administrative formalities when implementing a project, a big problem is to ensure, mobilize fund for the state own enterprises in real estate commerce field and the relation between the financial market and the real estate market In state of lacking fund, lacking professional in operation (specialized market; study-develop to catch the trend of the customers; capacity of implementing project and control level), pressure of competition from the foreign opponents but the domestic firms in housing construction, real estate commerce field still not have cooperation mind with each other 3.1.3 Strong points In the past 20 years, the Corporation has made great pace of establishment and development over the growth of new urban areas synchronizing infrastructure and public services Starting with the construction of new urban area of Linh Dam, and later on with others like Dinh Cong, My Dinh, Viet Hung, its products were highly appreciated and were considered as exemplary works of the urban development at the time being Personnel are all highly competent and qualified managerial experiences, wholeheartedly concentrating on the development of the Corporation Page 78 Assigned by the Government, the Corporation plays a key role in the establishment of Vietnam Housing and Urban Development Corporation, upholding the leading function of the state enterprise and contributing to the regulation of Vietnam property market By focusing on the economic efficiency projects, the Corporation has made such a good performance on the development of real estate market at all levels The brand name of HUD has been well maintained and popularized in Vietnam’s big cities as well as in other localities 3.1.4 Weak points Subsidiaries’ competence and self-reliance are limited, and their initiatives were not expressive enough Lack of competent staff and well-trained workers causes imbalance between the human resource development and the demand for the growth of the Corporation 3.2 Several solutions by HUD’s Leadership Board to improve its business strategy formulation task Sticking to HUD’s construction project and its development strategy toward the year 2015 to build and implement the quarterly and annual development program for the Corporation with the following solutions: Thoroughly grasp viewpoints on building the HUD Corporation in conformity with criteria in a consistent and urgent manner to ensure the solid development of the Corporation Concentrate on guiding the construction of the Corporation’s middle-term and long-term development strategy to 2010 and 2011 to 2015 following the operation model of HUD economic corporation in the area of housing and urban development, thus contributing to stabilizing the demand for housing of low-income people and policy targets Page 79 Continue implementing task programs - Regarding the project development strategy: conducted under the guideline of combining small and medium-sized projects with bigger ones, immediate investment projects with long-term ones, linking investment with business; and finding new markets whereas standing firm in traditional markets - Regarding enhancing financial capability: The Corporation is able to hold fast to stability and development against the backdrop of influence of financial crisis and a quite real-estate market thanks to its capability in creating a correlation between finance and investment i.e finance is the necessary condition to carry out investment and in return, investment needs to shape capability of piling up finance or “implement capital rotation in investment” in financial terms - Regarding maintaining and bringing into play HUD brand name: The Corporation possesses a firm HUD trademark since it has been forged on a solid foundation In essence, HUD brand name closely ties to the guideline of “taking service for doing business, taking service for development”, - Maintaining and enhancing the effectiveness of the parent-subsidiary company model in line with targets of action: strengthen investment capacity of the subsidiary companies, promote building and assembling capacity of the subsidiary companies, enhance designing consultation capacity and upgrade financial capability in which the last one is the result of the former programs Unceasingly consolidate, arrange and perfect the organizing model in line with the Corporation’s responsibilities, improve functions and responsibilities of its departments (boards), upgrade its human resource quality, instruct the building of the coordinating process among departments and boards under the ISO standard to improve administrative procedures and promote production development Instruct and put into order and discipline the building of investment plans which ties to the monthly and quarterly financial plans Page 80 Provide guidance on intensifying the enterprise’s management task; manage the monitoring and operation to ensure the Corporation’s sustainable development 3.3 Some suggestions and recommendations to improve HUD’s business strategy formulation task Apart from solutions adopted by HUD’s Board of Leadership, our group of students also proposes some following solutions for the business strategy formulation task to provide HUD Corporation with more solutions to complete its set business strategy in the process of building and developing Vietnam’s Housing and Urban Development Corporation Changing mindset in strategy formulation Business strategy formulation is an activity of high thinking nature that if the mindset about it is not changed, it’s difficult for the strategy to be changed Therefore, the mindset, and administrative qualifications in general and strategic management in particular for the Corporation’s administrative officials should be timely updated In business strategy formulation, some administrators tends to encounter mistakes in their process of awareness, resulting in formulation incorrect strategic decisions which requires a more radical renovation in the mindset of the Corporation’s administrative apparatus Renovating mindset on the Corporation’s strategy formulation in the time to come should go into one of the following directions: - Appreciate the business strategy formulation task, putting it in its deserved role and status This thinking, if fully grasped, can repair the situation whereby some management sections of the Corporation keep thinking that strategy formulation is a luxurious one that can only be done in foreign companies or developed countries whereas the business condition and environment of Vietnam not require strategies, thus looking down on their roles Renovating mindset help repair the thinking of seeing strategy formulation as a decoration form to report to the higherlevel for form’s sake with little application them into the enterprise’s business Page 81 operation The Corporation should put the business strategy formulation task into the management cycle, deeming it as an important and efficient tool to upgrade its competitive advantages with the least costs This is a step toward completely erasing the state-reliant thought i.e waiting for state’s economic development strategy and industry’s strategy to be done then formulation its own strategy The mindset of waiting and relying on others has dispossessed the Corporation of the activeness in guiding and managing the production and business strategy It’s thus necessary to make changes to that thinking, regarding the business strategy formulation an indispensable phase in the Corporation’s management task - Only by heightening the business administrative thinking and administrative reasoning capacities of the projecting officials can the old thinking in strategy formulation that focuses on general numbers and predictions be changed It is also necessary to intensify renovating new information, knowledge update and withdraw experience from “strong” enterprises in the world to apply into the specific context of Vietnam so as to promote the strategy formulation task’s quality Approach and use advanced business strategy formulation methods Currently, the Corporation still uses the empirical statistics methods that is adaptable to experience and use the matrix method, nevertheless, the matrix method is only mentioned to but almost not yet used in strategy formulation task According to the theoretical and practical practice, the empirical statistic method cannot be used for formulation the business strategy Therefore, the Corporation should renovate its method to fit with its own conditions as well as the external business environment in which the matrix method can be applied in business strategy formulation Standardize the strategy formulation process The reality of business strategy formulation task of the Corporation reveals that this content has not truly reflected the theoretical and practical requirements The Page 82 Corporation should, hence, standardize contents of business strategy formulation The contents should be renovated as follows: a Analyzing the enterprise’s internal resources It is necessary to distinguish analyzing internal resources for business strategy formulation with analyzing the results of business operation of the Corporation The Corporation’s business operation results can only show the Corporation’s business reality at a specific period of time not its potential strengths in the future The Corporation should find its core capabilities which its competitors not possess or are weaker in order to propose strategic solutions To identify core capabilities in analyzing, it’s necessary to apply the approach method of reviewing in the correlation with the business environment and competitors and avoid the traditional way of comparing to itself previously b Analyzing the external business environment The Corporation should be active in studying the business environment without relying on the State, change both the analyzing methods and objects in the direction of using modern methods, combine both distanced and close analyzing to give out precise outcomes; apply orthodox theory on analyzing the external business environment, analyze competitive capability pattern to find out real opportunities for its own Forecasting task should be appreciated and put in an orderly and scientific manner c Improving the building of strategic objectives The Corporation should clearly define its market-oriented development viewpoints in which targeted customers, operation areas should be specified It is wise to discard the method of identifying the viewpoints and strategic objectives basing only on products and assigned responsibilities as it does not fit with an environment with many ups and downs Reality has shown that building the development viewpoints on the assigned plans and responsibilities usually results in great difficulties once the Page 83 market fluctuates It is therefore compulsory to change the ways of specifying its own mission, that is to divert to customers’ demand and to define the customers for its own With regard to building strategic objectives, it is also necessary to renovate approach methods with the goal to reaffirm the targets that the Corporation has to strive for, reflecting its commitment with relevant targets; as well as distinguish the strategic objectives with strategy implementation objectives The strategic objectives are in a qualitative manner since they manifest changes in quality; besides they have to be given priorities so as to make breakthroughs A renovation in building objectives needs to recognize objectives that bear both stationariness and activeness d Estimating possibilities and strategic solutions The Corporation should renovate its strategic estimating project In fact, there is not only a unique project but plenty of various ones Therefore, it is necessary to give out several equivalent estimated strategies to provide wider options, resulting in a better selected strategy In reality, there are many cases whereby the selected strategy needs to be altered as a sudden strategy has been discovered in the business process e Strategic selection The Corporation should build the strategic decision formulation mechanism in a more scientific manner to avoid wrong decisions due to incorrect awareness i.e mistakes in available hypothesis, mistakes with representative manner, extrapolation reasoning, too far commitments, and illusions in controlling power In the time to come, it is necessary to change the form of decision formulation by intuition and experience, and replace the form of staff congress and shareholder’s meeting at the Corporation with the one of formulation scientific decisions in combination with clear individual responsibility of the top leader Through this mechanism, the Director General will increasingly make use of consulting ideas from the specialists, administrators and higher-level leaders Enhancing strategic forecast capability Page 84 In order to renovate methods of business strategy formulation, the Corporation should set up and develop the strategic forecast task in a scientific manner The strategy can only be feasible once the Corporation’s opportunities are precisely forecasted This can only be implemented if correct prediction about development of the business environment and its impacts on the Corporation are made The above analyzing results show that the forecast ability and quality of the Corporation are not high and its forecasting task remains intuition-based, subjective and does not really apply the scientific forecasting method in service of the Corporation’s business strategy formulation Strategic forecast is different from demonstrator forecast Strategic forecast aims at trends that may have decisive influence on the business operation, on changes in housing demand and State’s significant macro-economic policies Therefore, in order to enhance the accountability of the strategy as a tool to orient development, it is necessary to promote the quality of the forecasting task and specialized units to independently make forecast and at the same time having power to give out independent assessment in the spirit of taking self-responsibilities should also be established In order to have a useful forecasting model, it is necessary to pay attention to the following requirements: - It is unwise to make forecast under the form of “inertia principle”, that is relying on the past to predict the future but use the model of taking the future back to the present to make analysis and forecast - Do not focus on forecast of quantitative manner but qualified ones that can deeply affect the competitive situation and housing demand of the market in the future - Strategic forecast must be conducted in a regular manner to add information previously having no clear basis and newly appearing information and events Page 85 Apart from bringing into play the knowledge of strategy makers, it is necessary to further mobilize “the brain” of external experts in strategy formulation Reality shows that the method of using experts will save costs and increase the accountability of the forecast The specialist forecast method is also called Delphi forecast method By using the Delphi method, the Corporation can mobilize the contribution and support from current specialists, researchers and science centers of the nation Establish the strategic information collecting and assessing system One of the reasons formulation the Corporation’s business strategy formulation task remain limited is that its information system is yet to catch up with the development speed of the Corporation The quality and efficiency of strategy projecting very much depend on the quality and timeliness of the information An efficient strategic information collecting and assessing system will help the Corporation enhance its timely reaction capability and proactively adjust its strategy Investment on upgrading the information collection and assessing system, therefore, will increase the quality of the strategic administrative information system Improving the apparatus, upgrading managers’ capacity Renovating guidelines and contents can only bring about outcomes as desired when the strategic administrative machine adopt suitable changes The specialized capacity of the officials doing the strategy formulation task has to satisfy requirements of building the Corporation’s strategic responsibilities We have known that the capacity of projecting officials greatly affects the quality of the projecting task in that a good projecting lineup can repair weaknesses of the whole system Therefore, improving the apparatus and enhancing staff capacity are key solutions to renovate and heightening the quality of the Corporation’s business strategy formulation task in the time to come Page 86 Study the organization and management model to apply in formulating and implement business strategy of the Corporation The Corporation’s business strategy is to establish Vietnam Housing and Urban Development Group The Corporation has undertaken study and defined criteria for establishing a Group with real estate characteristics However, it is necessary to research and assess the model as the model is constructed and implemented on pilot basis under Vietnam’s circumstances Things need to be analyzed and reviewed include: the purpose of establishing a real estate Group; weaknesses of Vietnam’s present economic groups; solutions for establishing strong economic groups Formulating risk prevention strategy Risk management has become an increasingly important management factor, equal to financial management or management of other resources in the company Risk management in the Corporation should be focused on the following issues: - Identification of possible risks - Calculation of the probability and possible loss - Controlling risks to prevent them spreading and becoming causes of other risks - Taking prevention measures such as: + Analysis of the business environment to get rid of causes for risks; + No business in high risk domains; + Diversification to divide risks; + Setting up provision funds to make up for loss; + Purchase of insurance for assets to cover risks The Corporation should periodically make a comprehensive evaluation of its operations, in which focus should be placed on potential risks This evaluation should Page 87 be done at least twice per year, by a team of experienced staff from main functional Departments The evaluation should be well prepared, with clear methods and should be documented…When evaluation of potential risks is undertaken, it is necessary to make a full check list covering all aspects of operations Analysis, evaluation of potential risks is an effective tool for the Corporation to be able to prepare measures to cope with actively This is also a systematic tool, creating a culture of risk prevention, thus facilitating sustainable development for the enterprise Accession to WTO will not only bring Vietnam real estate market many development opportunities but also several new challenges and risks The reason is because Vietnam real estate market is still new and unprofessional; Vietnam real estate market has yet to have comprehensive legal system; Vietnam real estate market lack transparency and investors with substantial economic capacity Periodical appraisal Periodical appraisal can be done by leading consultancies with excellent experience and service, which can keep the Corporation timely informed of strategic management information 10 Recommendations to governing body of the Corporation and the Government - Government agencies need to quickly formulate and appraise strategy, plan for long-term sectoral and regional development - The government needs to improve legal regulations in order to institutionize policies, reduce administrative procedures, create legal environment for enterprises’ operation so that enterprises are active in their work, at the same time, creating fair competition among enterprises -The government needs to assist in terms of information on business environment, providing forecast about domestic and international markets Page 88 Page 89 CONCLUSION Business strategy formulation helps enterprises make full use of business opportunities, realize their strengths as well as avoid threats that can affect their future development Furthermore, business strategy formulation analyzes and points out the linkage or connection between business environment and enterprises, between past, present and future That connection or linkage lays the foundation for targets in future corporate strategy Applying theory of strategy formulation and management, this paper tries to fulfill the following tasks: - Organizing systematically theories on corporate strategy management and formulation - Analyzing the current situation of business strategy at Housing and Urban Development Corporation and then pointing out strengths and weaknesses in the Corporation’s business strategy formulation process - Applying theory on strategy formulation to improve the Corporation’s business strategy formulation - Give recommendations to improve models and contents in the Corporation’s strategy formulation With the above objectives, the paper tries to study, analyze and consolidate comments made by specialist in the field of housing and urban development We hope that the above contents can be useful reference material for managers in general and strategic managers in particular during formulating corporate strategies Although our group made our best effort in study, discussion, analysis of “topical” issues in business strategy formulation, this is still a large topic related to several subjects, majors while the time for research and length of the paper is limited, which Page 90 explains why there are still mistakes in the paper We hope to receive contribution and comments from our lecturers, fellow students, colleagues to further improve this paper We would like to send our sincere thanks to leaders, units of HUD Corporation for helping and providing quality information so that we can finish this paper We would like to express our gratitude to our lecturers who provide us with valuable knowledge so that we can enhance our capacity and be ready for senior positions later on In this paper, our reference material is articles written by the Chairman; the Managing Director of HUD; Legal Department Manager; Managers of other departments and summary report of HUD operation over periods as well as resolutions by HUD Party executive committee Page 91 REFERENCE [1] Strategic management lecture notes and materials - ETC center [2] In-company bulletins - HUD [3] Summary report of HUD operation over periods [4] Development strategy of HUD up to 2015 [5] Management strategy: competition and globalization Hill, M., Ireland, R., and Hoskinsson, R., 7/e, 2007 Thomson Southwestern [6] Management strategy, Professor -Dr Le The Gioi, Dr Nguyen Thanh Liem, Dr Tran Huu Hai Publisher Statistics, 2007 [7] Grant, RobertM., Contemporary Strategy Analysis: Concepts, Techniques, Applications [8] Besanko, David, David Dranove, Mark Shanley, and Scott Schaefer; Economics of Strategy, 2004, 3rd ed John Wiley & Sons [9] Michael E Porter, Competitive Stategy: Techniques for Analying Industries and Competitors, 1998 1st ed Free Press [10] Websites http://www.havardbusiness.com http://www.Strategy-business.com Page 92 [...]... HUD is proud of its establishment and development process that closely ties to the country’s renovation period and its significant contribution in the area of housing and urban development Page 35 The Corporation is the pioneering business in the area of nation-wide housing and urban development and the one to carry out investment in the first new urban block in Hanoi, namely Linh Dam Urban Block that... name of Housing and Urban Development Corporation (HUD in short) and operates nation-wide With almost 20 year experience of growth and development, the Corporation s status has been increasingly enhanced and its brand-name has become one of the leading trademarks of Vietnam in the field of housing and urban development, thus contributing a significant part to the national industrialization and modernization... competitors operating in the business field and competitors in dividing profits from a group of customers - It is necessary to collect information about the competitors i.e classifying them, their goals and judgment about them as well as their strategies and potentials - Define the level of market competitiveness basing on the following factors: + Number of competitors; + Level of growth in the business sector;... at the host country f Strategy of global alliances g Operation of alliances 1.3 Business strategy implementation 1.3.1 Objectives, conditions of the business environment and the selected strategies 1.3.1.1 Reassess objectives of the business strategy Objectives of the business strategy are normally defined on the basis of the enterprises’ business strategy Enterprises usually classify objectives of the. .. customer’s demands; - Achieving exceeding rate in meeting customer’s demands 2 Strategy at the business level Page 24 a Strategy at business section level Strategy at the business section level is the combination of commitments and actions that help the enterprise gain competitive advantage by bringing into full play its core capabilities in specific productivity market b Selecting a common business strategy. .. AT THE HOUSING AND URBAN DEVELOPMENT CORPORATION (HUD) 2.1 General features of the Corporation 2.1.1 Establishment and development process of the Corporation The Housing and Urban Development Corporation (HUD) is a State-owned corporation organized and operated in accordance to the Decision No 90/TTG dated 07/03/1994 of the Prime Minister The corporation was established in 2000 (in accordance to Decision... the fundamental principles of the administrative structure The main substances of these principles are linkages to the objectives, balancing principle, flexible principle and unanimously command principle Administrative scope together with organization division is one of the most interested issues and serves as a scientific basis for organizing the apparatus Page 29 Defining the administrative scope... enterprises, therefore, should know from the very beginning the tasks that they need to implement Defining the strategic objectives and duties of the enterprise is a very important start in the implementing the strategic business management Clearly defining and specifying the objectives is an important step for the enterprise’s success * Principles in defining objectives: - Concreteness: the objectives... those are: - The business strategy has to clearly identify fundamental goals needed to be obtained for each period and thoroughly grasped in all aspects and levels of the business and production activities of the enterprise - The business strategy has to ensure to mobilize and combine to the utmost the exploitation and use of resources (human resources together with other visible and invisible property)... for future upheavals in the inner and external operation environment, thus bringing about great outcomes of financial records in their fields of business Annually there are about 20,000 enterprises in the United States plunged into bankruptcy and 50,000 cases of failure in business There are many causes contributing to those failures apart from the lack of a clear and efficient strategy, yet statistics