BUSINESS STRATEGY OF nha be garment corporation

. Concept, role of business strategy in company business operation The process of company strategic management formulationBuilding up strategy optionsBUSINESS AND MANUFACTURE OPERATION SITUATION OF NHA BE GARMENT CORPORATIONADVANTAGES AND DISADVANTAGES OF NHA BE GARMENT CORPORATION IN PRODUCTION AND BUSINESS OPERATION BUSINESS STRATEGY OF NHA BE GARMENT CORPORATION TOWARDS THE YEAR 2011 AND SOLUTIONS TO IMPLEMENT STRATEGIES

BUSINESS STRATEGY OF NHA BE GARMENT CORPORATION INTRODUCTION Justification: Researching methods: 2.1 Method of statistics collection: 2.2 Method of comparison and synthetic: 2.3 Method of listing in chart and table: 2.4 SWOT method: RESEARCH SCOPE: Topic content: CHAPTER 1: THEORY BASE OF BUSINESS STRATEGY 1.1 Concept, role of business strategy in company business operation 10 1.1.1 Concept on business strategy: 10 1.1.2 The role of business strategy in company business operation: 11 1.2 The process of company strategic management formulation: 12 1.2.1 Identifying mission and objectives of company: 12 1.2.2 External environment assessment: 13 1.2.2.1 Macro environment: 14 1.2.2.2 Micro environment (industry environment): 16 1.2.3 Internal company analysis: 19 1.2.3.1 Financial analysis : 19 1.2.3.2 Function analysis: 20 1.2.4 Rival analysis: 23 1.2.5 Building up strategy options: 23 1.2.5.1 Product strategy: 23 1.2.5.2 Competitive strategy 26 1.2.6 Analyzing and selecting strategy 26 1.2.7 Strategy implementation 19 1.2.8 Monitoring and evaluating strategy implementation: 27 CHAPTER 2: BUSINESS AND MANUFACTURE OPERATION SITUATION OF NHA BE GARMENT CORPORATION 2.1 Introduction of Nha Be Garment corporation: 28 2.1.1 Establishment and development history: 28 2.1.2 Organization structure: 29 2.1.3 Business fields: 30 2.1.4 Consumption Market: 31 2.1.5 Typical achievement: 32 2.2 Analyzing business operation result situation in recent years: 33 2.2.1 ADVANTAGES AND DISADVANTAGES OF NHA BE GARMENT CORPORATION IN PRODUCTION AND BUSINESS OPERATION : 37 2.2.1.1 Advantages: 37 2.2.1.2 Disadvantages : 38 2.2.2 Development Orientation towards the year 2011: 38 2.3 INFLUENCING FACTOR ANALYSIS: 39 2.3.1 Business environment factors: 39 2.3.1.1 Macro environment: 39 a Economic environment: 39 b Technological and scientific factor: 43 c Socio-cultural factor: 44 d Natural factor: 45 e Legal and political factor: 46 2.3.1.2 Micro environment (industry environment): 47 a Companies in the industry: 47 b Pressure from customers: 51 c Pressure from suppliers: 52 d Pressure from potential rivals: 53 2.4 SWOT matrix: 54 a SO Strategy : 59 b ST strategy: 60 c WO strategy : 60 d WT strategy : 61 CHAPTER 3: BUSINESS STRATEGY OF NHA BE GARMENT CORPORATION TOWARDS THE YEAR 2011 AND SOLUTIONS TO IMPLEMENT STRATEGIES 3.1 The business strategy of the Corporation up to 2011 3.1.1 Identifying strategic objectives 62 3.1 2.Strategy implementation: 62 a Long term: 64 b Medium term: 64 c Short term: 64 3.1.3 Unit strategy formulation: 65 a Market strategy: 65 b Competition strategy: 69 3.2 SOME SOLUTION FOR IMPLEMENTING BUSINESS STRATEGY OF NHA BE GARMENT CORPORATION 73 3.2.1 Market policy: 73 10 For differentiating to meet the consumption demand of customers who transact through orders, the implementation measure is to provide fully the information on after sales services and maintenance forms - International market: This is the market for customers with high income The differentiating strategy of the company is mainly for high quality and good design products For this market, the price is not a concern Therefore, it’s necessary to concentrate on the designs and quality The consumption psychology of international customers is also very different: To implement this strategy, the company should: + Speed up market and consumers research + Design the production machines and equipments flexibly to apply and produce many types of products + Improve customer service + Invest in building product image  Competitive strategy by delivery time: This is the strategy to win international markets, especially EU, USA and Japan etc These potential markets always consume a large number of products The price pressure is not too big The biggest requirements are about product quality and delivery time With the production and business capacity of the company, it can totally complete orders within short delivery deadline This is a big advantage in comparison with other rivals, even Chinese ones To implement this strategy, the company should: 78 + Study and apply science and techniques for large production, invest in modern equipment and production line with latest models of famous firms + Speed up the company product promotion; find strong suppliers to ensure stable input + Implement programmers on production management, especially material management; timely keep up with the production progress + Focus on developing professional management in production and business The product structure of the company is not suitable and lacks new products with special features to attract customers 3.2 SOME SOLUTION FOR IMPLEMENTING BUSINESS STRATEGY OF NHA BE GARMENT CORPORATION 3.2.1 Market policy:  Enhancing market expansion: The market of each company is very important It decides the survival and development of that company Therefore, studying to understand, maintain and develop the traditional market, find and open new markets are the top tasks that each company must To make this activity meet the development requirements, the company should implement the following measures: - Enhance product introduction, the company image promotion through building a strong brand name Products should be promoted widely through public media means 79 - Train to have qualified marketing and sales staff to attract customer using their products - Develop shop system, introduce and sell products widely with different channels Extend agent system through which information about the product will be provided and customer information will be gathered  Enhance market research - The company should set up a professional department on market research - Set up market research groups for each market segments The market research department should be skillful in their profession to know thoroughly the market features This department will connect with other departments like production and finance ones etc and to strategy formulation department to make production plans for each period 3.2.2 Product policy: Product quality meeting the requirements is pressing claim to the company Implementing product strategy includes the following: • Implementing a system of quality management according to international standards like TQM, ISO, TPS, Setting up a quality management standard system for the company will play a very important role in improving product quality, competitiveness and prestige To implement this, the company can hire consultants; ask for external evaluation and approval of meeting international standards At present, some company products have been given certificates on meeting the international standards like SA 8000 certificate; ISO 9001-2000 certificate and WRAP certificate 80 - Effectively implementing material and input management Enhancing market research network, looking for stable and high quality materials and paying attention to domestic supply Based in this, improving the rate of using domestic material, increasing domestic rate in the product value structure to reduce production cost Increasing domestic rate to get assistance in tax and reduce production cost - For the equipments and machines used in production, because the company has large production scale so it can invest in modern and comprehensive technology line to make high quality products - Controlling quality closely Setting up and enforcing ISO quality control system to raise the prestige of the company in domestic and international markets - Defining a suitable product structure The product structure should be suitable to the market requirements - Research to merchandise new high quality products Investing in product designs and new product development: Clothes are fashion products Aesthetics and taste of products are the decisive factor the quality as well as the product demand What the consumers care for the most is if products are fashionable, good taste or not then if they are long lasting and how much is the price 81 Therefore, product designing is an important step in the business process Being aware of this, the company should invest in renovating machines and equipments, installing computer system and software which are suitable to the quality standard system that the company is applying For designers: it’s necessary to continue training and improving the qualification, creating conditions for them to access and grasp latest achievements and models The fact shows that the company designers are young and limited The company should have motivation policy, suitable compensation to encourage their creativeness Currently, the biggest problem for companies is the dependence on the source of raw materials, spare parts abroad.In order to produce stablely, processing for foreign partners is a solution for companies, despite lower profits By the outsourcing partners will supply timely, adequate materials This is not just difficult for individual companies but entire industries or even a large country like China is also facing difficulties On that basis, the company invested in a special search for materials supply domestic and international investment research, finding stuff to replace the raw materials to ensure production with high production and high energy volume, low cost 3.2.3 Price policy To have a suitable price policy, it’s necessary to base on the production cost, market demand, competitiveness and legal matter etc So the company should have the following measures: - Calculating accurately the product cost, researching to reduce production cost (finding cheap material source to replace imported one, saving materials in production, improving production productivity etc) 82 - Developing promotion measure for customers like reduction when buying large number of products or periodical sales off - Offering a price which is not only suitable to the company cost but also that of rivals 3.2.4 Capital mobilization To have capital for development in the coming time, the Nha Be Garment Corporation should implement the following comprehensive capital mobilization forms: - Enhancing relations with banks and international organizations to get loan for development The company can mobilize capital by delayed loans from other economic organizations - The corporation should privatize its members; especially those are not effective to attract the unused capital from staff, creating large capital for its business and production - The corporation should speed up the capital rotation to make the working capital more effective 3.2.5 Human resources measure The total existing workers of the company is 15,000 people The majority of workers are from country side in which female workers accounts for the major part, which is also a special trait of Vietnam garment industry The management staff qualification is not high; the skills of workers are low Meanwhile, human is an important factor of the production process Therefore, training and improving the skills and qualification for staff and workers are a necessary work for companies 83 Cơ cấu nguồn nhân lực củahuman công tyresources qualification Chart 3.1 The company 86 % structure ( Source: Nha Be Garment Corporation) 100% 80% 40% 20% 14 % 60% 0% Nam N? Column 19 Table 3.2: The proportion of male – female ( Source: Nha Be Garment Corporation) To facilitate the differentiating strategy, low cost strategy and the development in the future, the company should pay appropriate attention to human resources activities for both managers and technical staff in production units 84 Increasing training the human resources to have high quality human resources in management, techniques and technology, fashion designing etc Extending cooperation with foreigners, vocational training school to train workers with applicable training methods Building a harmonized labor relation among employer and employees Taking care and improving the living standards for employees Having satisfactory policy to improve and attract talented individuals * For employees, it’s necessary: - Improving the qualification and capacity of employees to meet the requirements of science and technology Organizing frequently training courses to provide employees with discipline and scientific working methods - Organizing profession competition for employees based on the labor categorization to make suitable training plans For bad workers, they should be classified into two types: Workers who are poor in profession and knowledge and workers who are poor in skills For those with bad professional knowledge, the company should organize training courses on profession, skills, technical and technology process depending on its specific conditions For those with bad skills and depending on the production situation, it’s necessary to have concentrated training courses or learning by doing training with highly skilled and experienced workers - Implementing labor protection rights according to the law - Paying appropriate attention to the working environment of employees Annually, there should be certain training for employees about labor safety and hygiene, guiding them to implement appropriately labor safety regulations Creating modern and civilized working environment 85 - Ensuring working time and stable income The company should have a suitable policy to make stable income for employees while attracting talented individuals to work to the company The salary policy can be changed depending on different time but it should show the different priority for highly qualified people * For managing staff Besides the common requirements, it’s necessary for them to work effectively: - Arranging and appointing management staff with their capacity and qualification matched - Arranging tasks clearly, avoiding overlapping which causes difficulties in implementing tasks - It’s necessary to send young and potential staff to prestigious training center in and outside the country This training will help them to have new views on the markets, to know and process market information and new business types - The company should organize annually training courses to improve management profession, skills and qualification by signing training contract with some large universities like National Economics University, Foreign Trade University or foreign professional organizations from Japan and Korea etc For strategy formulation staff in particular, it’s necessary to select those with high profession and good knowledge of the company and markets and practical knowledge to make feasible strategies 86 CONCLUSION The theory and fact have proved that the business strategy plays an important role in the operation of companies in modern economy In an industry with tough competition, an appropriate business strategy is essential for Nha Be Garment Corporation in its integration It will help the corporation to respond flexibly, timely and in the right direction to the business environment changes With the business strategy, the Corporation will define appropriately the system of objectives, policies and measures that it needs to implement in the future However, in the ever changing business environment, to improve the effectiveness of strategy implementation in the actual business, it’s necessary to be flexible, which means to select the best feasible option to reach the set objectives Therefore, defining and applying the strategy in the business practice of Nha Be Garment Corporation in the coming time will be a very important task which needs the commitment of all staff in the Corporation Due to the limited research time and conditions and despite of many efforts, shortcomings are unavoidable for this paper Thank you very much for your comments! 87 REFERENCES I English sources: Arthur A Thompson, Jr., A.J.Strichland III, Strategic Management – Concept and case, 10thed, Irwin/- Hill company, 1998 Rick W Griffin, management, thed, Copyright,1993 by Houghton Miffin Co Garry D Smith – Danny.R Arnold- Boby R Bizzell – West Publishing Company, 1995 George Manning, Kent Curtis, The Art of Leadership, McGraw- Hill Higher Education, 2003 Philip Kotler, Marketing Management, Prentice Hall international Inc II Vietnamese sources National Economics University, “Corporate management textbook”, Statistics Publisher, 2000 National Economics University, “Strategic management textbook”, Statistics Publisher, 2000 National Economics University, “Business Strategy and Corporate Development text book”, Labor and Society Publisher, 2002 Lê Thế Giới, Nguyễn Xuân Lãn, Nguyễn Phúc Nguyên, Nguyễn Thị Loan, “Management”, Finance Publisher, 2004 Nguyễn Hữu Thân, “ Human resources management”, Statistics Publisher, 2000 88 General Department of Statistics, “ Statistical Year Book 2007” Statistics Publisher, 2007 Nguyễn Vĩnh Thanh, “Increasing competitiveness of Vietnamese commercial companies in international economic integration”, Labor and Society Publisher, 2005 Materials on some garment companies: Đại Việt company , Bắc Nam garment company, Việt Tiến Garment company, Garco 10 Internet resources, Finance magazine, Commerce magazine, Foreign Trade magazine, Economic Development Times, Vietnam Economic Times 10 Đinh Quý Xuân, “Vietnam’s socio – economy on the threshold of integration”, Statistics Publisher, 2005 89 Board of Management – Board of Director Ms Duong Thi Ngoc Dun Mr Vu Sy Nam Member of Management Board Head of Management Board General Director Mr Nguyen Van Hoang Mr Pham Phu Cuong Member of Management Board Member of Management Board Deputy General Director Deputy General Director Ms Nguyen Thi Anh Hong Deputy General Director Mr Le mac Thuan Member of Management Board Deputy General Director Mr Tuan Nguyen Nghi Member of Management Board Managing Director Mr Phan Van Hai Head of Control Board Total factory directly under the company: 16 Total joint venture company: Production area: 88,000 23,300 sp sp meters meters Total Total employees employees 12,000 persons 4,085 persons Production Production Capacity: Capacity: Shirt: 300,000pieces piecesper permonth month Jean: 90,000 Jacket:350,000 pieces perper month Knitted: 350,000 pieces month Men’s and Women’s : 450,000 sets per Men’s Vestons: 20,000Vestons sets per month month Trousers: 500,000 pieces per month 90 Jacket: 65,000 pieces per month Trousers: 390,000 pieces per month Total cooperation company:5 Production area: 13,800 sp meters Total employees 1,740 persons Production Capacity: Jacket: 115,000 pieces per month Trousers: 270,000 pieces per month * Joint Venture Company Cuu Long Garment Joint Stock Company NEWELL - NHABE Joint Venture Company Phu Thinh Garment Joint Stock Company Binh Dinh Garment Joint Stock Company Tien River Garment Joint Stock Company Binh Thuan Garment Joint Stock Company Da Lat Garment Joint Stock Company An Nhon Garment Joint Stock Company Nam Dinh Garment Joint Stock Company * Cooperation Unit 2-9 Garment Company 247 Garment Company TOCONTAP Garment Company 91 Khanh Hoa Garment Company (Resource : Nha Be Garment Joint Stock Company) 92 [...]... Garment Corporation recently and working out business strategy for this corporation in the period of 2009 -2011 5 Topic content: Structure of the topic includes 3 parts: Part I: Theory base of business strategy 15 Part II: Business production operation of Nha Be Garment Corporation Part III: Business Strategy of Nha Be Garment Corporation towards the year 2011 and implementation solutions We would... assistance of all the teachers in implementing the topic 16 CHAPTER 1 THEORY BASE OF BUSINESS STRATEGY CONCEPT, ROLE OF BUSINESS STRATEGY IN COMPANY BUSINESS OPERATION 1.1 Concept on business strategy and the role of business strategy in company business operation 1.1.1 Concept on business strategy Strategy: Strategy term derives from Greece with two words “starts” (army, herd) and “ages” (leader, control) Strategy. .. now, under the Government management, Nha Be Garment Corporation has made efforts to use strategic management methods in business management and has harvested good practical results Recognizing the importance of forming business strategy, I would like to choose topic: Business Strategy of Nha Be Garment Corporation with a view to bring theory knowledge into business facts This topic aims at clarifying... of the country, the garment and textile industry became a major industry In accordance with such common development, Nha Be Garment Company was established by the decision of Industry Ministry In 2004, in continuing implementing renovation under the direction of the Vietnam Communist Party, Nha Be Garment Company was changed into Nha Be Garment Corporation – Joint Stock Company by the decision numbered... satisfying demand of market and taste of customers in each business operation period of company Content of product strategy - Identifying size of product combination in strategy : size of product combination in strategy is the number of product categories and their quantity, type, model and style that the company intends to market Each category of products has different types, so the product strategy has... implementing strategy are carried out through following steps : Identify objective and mission Assess external environment Analyze internal company Build up projects Analyze and choose strategy Implement strategy Monitor and evaluate implementation Implementation monitoring and evaluation 34 CHAPTER 2 BUSINESS AND MANUFATURE OEPRATION SITUATION OF NHA BE GARMENT CORPORATION 2.1 INTRODUCTION OF NHA BE GARMENT CORPORATION. .. in building up and implementing business strategy of Nha Be Garment 14 Corporation based on analysis and assessment of the corporation s business production situation as well as business environment recently 2 Researching methods 2.1 Method of statistics collection Primary data collection: observing facts in the company, interviewing individuals (mainly staff of the corporation) , etc Secondary data... methods, business scale and condition 2.3 Method of listing in chart and table: listing and identifying trends or general characteristics of analyzing factors 2.4 SWOT method: finding out strengths, weaknesses in the corporation This is a key method in forming strategy 4 Research scope: This paper studies business production operation of Nha Be Garment Corporation recently and working out business strategy. .. 81 11 LIST OF TABLES/ CHARTS Chart 1.1 The five competitive Forces that shape Strategy .16 Chart 1.2: SWOT matrix model 22 Chart 2.1 Organization structure of Nha Be Corporation 29 Table 2.2 Business operation results of company in recent years ( 20052008) 34 Chart 2.3 Market share of Nha Be Corporation 35 12 Table2.4: Garment export... Building up strategy options Business strategy consists of decisions on: which products and services that customers need ? Who are customer targets need satisfying? How to satisfy customers? These three decisions are expressed specifically in strategies of product strategy, market strategy , competition strategy and investment strategy 1.2.5.1 Product strategy Product strategy is effective business method