DEVELOPMENT STRATEGY OF THE VICD COMPANY

DEVELOPMENT STRATEGY OF THE VICD COMPANY .1 : To provide scientific justification for making development strategy of a company;2 : To provide the most accurate and genuine information on the business environment, defining the strength, weakness, opportunities and threats of companies at present.3 : To make and evaluate strategies and to choose the feasible business strategy for the company.4 : To propose solutions to achieve strategic goals which are suitable to the actual conditions of the company for the 20102015 period.

Thesis DEVELOPMENT STRATEGY OF THE VICD COMPANY INTRODUCTION Rational: Development strategy making is a requirement which has the orientation role ensuring the development, stability and effectiveness of a company In the market oriented economy, defining the development strategy for specific stages is the basis for the company to exploit the best the company potentiality and resources Makng a sound development strategy is the foundation for international integration and sustainable development in the market mechanism In VICD, development strategy definition for each stage received special attention from company managers Knowing the importance of development strategy, the group has worked with the company managers to make development strategy for the company up to 2015 This is a practical study and during the research, the group has been supported by the company management board and director board The group also got the enthusiastic assistance of the Professional Council, professors, and instructors of the university, national professors and instructors The significance of the paper Studying and making development strategy of a company help students to have chance to connect the obtained knowledge with the actual situation of the company Applying knowledge in the company management actual practices is the best experiences for the students to complement and improve their knowledge of business administration in their personal development From the actual business situation, applying appropriately the knowledge and experiences of international business administration in the specific business conditions of the company will help the company to orient their development appropriately, ensuring using effectively the company resources and capacity The field study also helps the company to find its shortcomings and weak points to adjust the long term development strategy goals, define the specific strategic objectives, provide concrete action plans to achieve goals In terms of society, the company development strategy reflects the indispensable trends in the market economy wile show the consistent viewpoint of Vietnam government toward economic development during the international integration Research objectives: : To provide scientific justification for making development strategy of a company; : To provide the most accurate and genuine information on the business environment, defining the strength, weakness, opportunities and threats of companies at present : To make and evaluate strategies and to choose the feasible business strategy for the company : To propose solutions to achieve strategic goals which are suitable to the actual conditions of the company for the 2010-2015 period Research methodology: To fulfill the requirements and objectives of the research, the group has used a combination of methods: - Survey on the actual situation of the company - Analyze the overall strategy with planning tools (BCG, SWOT) and competitive strategy theory of Michael E.Porter Compare to provide the highly feasible solution Major research outcomes: - Applied company development strategy theory - Analyzed business environment, defined strength, weakness, opportunities and threats etc to understand the current situation of the VICD company - Developed and evaluated strategic options and selected the feasible business strategy for VICD Paper structure: Chapter1: Company development strategy theory Chapter 2: VICD actual situation analysis Chapter 3: Developing development strategy for VICD Chapter 4: Strategy implementation options, conclusion and recommendations The group would like to deliver sincere thanks to the Management Board, Director Board, functional departments of VICD for the whole-hearted supports and cooperation The group would like to thank Associate Professor, Professional Council, professors, instructors of NEU CHAPTER I COMPANY DEVELOPMENT STRATEGY THEORITICAL BASIC 1.1 BASIC STRATEGIC ISSUES 1.1.1 Definitions of strategy: There are many different definitions of strategy and they vary depending on the viewpoint of each author In 1962 Chandler defined strategy as “identifying the basic and long term goals, objectives of companies, implementing action sequence as well as allocating necessary resources to achieve objectives.” (1) In 1980 Quinn presented a more general definition of strategy: “ Strategy is the pattern or plan that integrates major goals, policies and action sequences into a cohesive whole” (2) After that Johnson and Scholes redefined strategy in an environment with many changes: “ Strategy is the direction and scope of an organization over the longterm: which achieves advantage for the organization through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations” (3) According to Mintzberg, strategy definition is generalized with P: Plan: a consciously intended course of action Pattern: consistent in behavior, whether or not intended Position: locating a firm in its environment Perspective: ingrained way of perceiving the world Ploy: specific "maneuver" intended to outwit an opponent or competitor (1) Chandler, A (1962) Strategy and Structure.Cambrige Massacchusettes.MIT Press (2) Quinn, J,B (1980)Strategies for change; Logical Incrementalism Homewood (3) Johnson, G, Scholes, K (19990 Exploring Corporate Strategy, 5th Ed.Prentice Hall In nature, the definitions of strategy are made depending on the viewpoint However, the levels of strategy include: Corporate strategy, Business unit strategy, and Functional strategy According to Charles W.L.Hill and Gareth R.Jones: “Business strategy is a process of identifying the basic and long term objectives of the company, selecting action methods or option and relocating necessary resources to implement those objectives” Fred David: “Business strategy is the tools to reach the long term objectives” William J Glueck: “Business strategy is a comprehensive, consistent and integrated plan which is designed to ensure the company basic objectives will be completed” Business strategy of a company is the comprehensive action plan aiming at implementing the ultimate objectives of the company However, the, strategy doesn’t draw specifically how to achieve those objectives but a frame for thinking and acting only The important thing is that all the business strategy is made and taken care of because it is used to distinguish the “competitive advantage” from other business plans In fact, all competitors make their own strategy because strategy is the ultimate objective and ensures that the company can find and gain the stable position against its competitors In exposing to the above definitions, strategy can be generalized despite of how differently it is expressed as: “A complex action sequence aiming at mobilising the resources of an organisation to achieve a certain objective.” 1.1.2 Strategic management: Garry D Smith said, “Strategic management is a process of studying current and future environment, identifying organization objectives: make, implement and check the implementation of decisions to achieve those objectives in the current and future environment.” According to Fred R David, “Strategic management can be defined as an art and science which set up, implement and evaluate multi function related decisions which allow an organization achieve the set objectives Strategic management focuses on combining the management, financial accounting, marketing, production, research and development and information system of all business aspects to make the organization successful.” There are many different definitions of strategic management However, according to the "Strategy & business policy" by MA Nguyễn Thị Liên Diệp, three approaches are available: • Environment approach: "Strategic management is a decision process to connect the internal power of an organization to the external opportunities and threats” The feature of this approach is the make the company responds to the environment, get opportunities and encounter threats • Objective and measure approach: "Strategic management is part of the decision making and management activities fixing the long term achievement of a company " This approach enable managers to identify more accurately the company objectives, which are the foundation of the management while allow the managers to use the organization resources more effectively • Action approach: "Strategic management is reviewing the current and future context, creating organization objectives, making decisions and supervising decisions, focusing ion implementing objectives in the current and future context " Strategic management is the studying current and future environment, setting organization objectives; setting, implementing and supervising decisions to achieve objective in the current and future environment in order to improve the competitiveness and position of the company 1.1.3 The benefits of strategic management to the company development Strategic management helps the company to know its objectives and orientation Being aware of the desired outcomes and objectives in the future helps the managers and staff to know well what to be done to be successful The environment conditions that the organization faces always change quickly and create surprises Strategic management helps managers to see clearly the environment in the future Therefore, they can know and take advantages of opportunities better while avoiding or limiting risks Strategic management helps managers to use effectively existing resources of the company and allocate them appropriately It helps company to attach decisions to the related environment conditions Moreover, strategic management harmonizes the organization demand, through which attract senior managers and create synergy to reach the common objectives of the company The fact of the study shows that the companies having strategic management often get better results than they did before and the companies not having strategic management 1.2 STRATEGY FORMULATION STEPS 1.2.1 Environment Analysis: In making business strategy, studying environment is very important It helps company the identify opportunities to take and see the risks and challenges to act with caution Environment is the existing factors, forces and institution impacting and influencing the company activities and operation outcomes The company environment consists of macro environment and micro environment (the industry) and the internal conditions Here below is the strategic environment analysis diagram of a company Diagram 1: The strategic environment analysis diagram of a company Macro environment Economic factors Legal, governmental and politic factors Social factors Natural factors Technological factors Global Micro environment (industry environment) Competitors Suppliers Customers Substitute products Potential competitors Internal conditions Human resources Research and development Management Production Finance Marketing Information system Strength Strengths Weakness The combination of strength, weakness, opportunities and threats will create a SWOT matrix and the strategic options for selecting Studying the operation environment of a company is focusing on identifying and evaluating trends and incidents go beyond the control of the company Evaluating external factors show the opportunities and challenges that a company faces so the managers can make strategy to take opportunities and limit risks We will analyze the operation environment of a company with the macro and micro (industry) environment 1.2.1.1 Macro environment 1.2.1.1.1 Economic factors They are factors outside the company They don’t not only orient and affect directly the management but also affect the micro environment of the company These factors are also the causes of opportunities and threats to each company in different industries Studying the macro economic factors plays an important role to the management of a company and it includes the following factors: economic development speed, inflation rate, exchange rate, interest rate, salary and income 1.2.1.1.2 Legal, governmental and politic factors They include the system of viewpoints and policies of the government, the system of current law, trends of diplomatic politics with other countries, and domestic, regional and international politic incidents The legal and politics factors can create opportunities or threats to company To take advantages of opportunities and limit the threats, companies must grasp the viewpoints, regulations and preferential programmes of the government They should establish a good relationship and even lobby when necessary to create a favorable environment for the company operation 1.2.1.1.3 Social factors Social influences mainly include: entertainment and pleasure habits, moral standards, aesthetics, lifestyles, professions, traditions, customs, interests and focuses of society, awareness and general education level of the society The social factors change slowly and are difficult to recognize 1.2.1.1.4 Natural factors Natural factors include geographical locations, climates, natural landscapes, land, seas, rivers, underground minerals and resources, marine and forest resources, air and water environment etc Natural factors are important input for many Table 14: Summary of selected strategies Group of Name of strategy Key content Strategy Market development Company level strategy Develop and expand market in strategy (combination of: the central, southern and S1,S2 S3, S4, S5, S7 + regional areas O3, O4, O5,O6 ) Strategy on improving Improve product’s quality and product’s quality and differentiate products so as to differentiating products: increase the competitiveness of (S1, S2, S3, S4, S5 + T1, Functional level strategy T4…) HR development strategy: (Combination of W1, W7 the company Focus on training, improving and developing HR, especially manager and technician staff + O1, O2, O3, O4, O5,O6 ) Organization restructure strategy: (Combination of W1, W2, W3, W4, W5 + T2, T4, T5 … ) 86 Focus on renovating organization structure; make the production process logical to effectively cope with competitors CHAPTER IV SOLUTIONS, CONCLUSION AND RECOMMENDATIONS 4.1 SOLUTIONS TO IMPLEMENTATION OF THESE STRATEGIES 4.1.1 Solutio n to the implementation of market development strategy Focus on investment, extend the production operation - of branch units to improve production capacity of traditional products of each unit: the group of hydraulic trimming and blowing dredger with biggest capacity in Viet Nam currently (1500m3/h), floating crane 600T, supply services of loading goods at sea ports, etc Continue - to maintain and develop sustainable relationship with traditional customers like VINASHIN Corporation, Vietnam navigation general company, Department of navigation of Viet Nam… Maintain sustainable growth progress and revenue, profit increasing Improve investment in doing research of new product and services to catch up with the demand of theses customers In the right time, the company can consider whether to develop the relation with these customers to a new level For instance, the relationship between supplier and the user of sole service of the sector The cooperation following the principle “Win-Win” (both sides have benefit) helped the company set up the production plan and development strategy in the long term - Maintain and supplement funding for the activity of research and development of new products, marketing, searching and approaching targeted customers and markets Carefully study the current demand targeted market and requirements on service quality - Improve marketing in foreign markets, especially the marketing strategy should be carefully studied and fully developed in 87 consultation with professional marketing consultants Probably speaking, marketing activity is the most important factor that determines the success or the failure of this market development strategy In the current trend that big customers in the world start using services of Vietnamese enterprises, effective marketing will attract the interest of these potential customers to the company’s services Strengthen the marketing activity in local market - which has a great demand on sea port services Establish a system of satellite units in some main markets like Đà Nẵng, Quảng ngãi, Hồ Chí Minh city, Vũng tàu Diversify the types of services to supply for the local market by investment for the team of research and development Develop a proper and flexible price system for - individual traditional market, making a step to penetrate into potential markets The development of price should base on competitive price among services of enterprises in the same sector, competitiveness of the company, relation between market demand and supply, tax preferential policy of the state for the company’s products and services Advantages of the company should be fully made use of during the process of developing policies and strategies on price Improve the import and export of specialized - accessories and equipment with the support of VINASHIN Corporation Market share should be quickly controlled; area of supplying equipment should also be extended Implement - the investment in extension and improvement of trimming dredgers, floating cranes to improve the company’s competitiveness 4.1.2 Solutio ns to the implementation of strategy for improving quality and differentiation of the products 4.1.2.1 Technology solution 88 Invest - modern and uniformed equipment and machines and build up production sites suitable with new technology Design, invest a proper dredging chain and loading - transportation, scientific and uniformed workshops and storages to make proper capacity and reduce cost, producing high quality products, improving the competitiveness of the company Beside the investment to equipment and machines for - production, the company should care about building a quality management system, applying effectively ISO 9000:2001 quality control system for all subsidiary units, investing equipment and facilities for monitoring and supervising Focus on medium and small works (from million - m3-5million m3) Compete based on the distinction in performance timeframe Searching financial resources for further investment in equipment for implementation to increase the competitiveness Negotiating with foreign investor to partly participate in large projects (dredging Quan chánh Bố channel350 million USD, dredging Soài rạp river -15triệu m3 ) Improve the efficiency in using modern equipment, - technology; reduce price for products to create the competitiveness of the company - Invest to research and approaching to modern equipment and technology, advanced management level 4.1.2.2 Solution to product quality - Product quality is the key factor that determines the existence of the company The development of the shipping industry is increasing, more and more customers pay their interest in the quality of services Service quality determines the return of customers to the company branding and the customers only accept the long term relation with the branding which can keep its reputation This is also a key factor that foreign enterprises have more 89 competitiveness despite high price Therefore, the company should put the issue of service quality as the leading objective of the company Based on the distinction, there is only supplier that - has capability in imposing (sole) price for goods coding from 150-400T, for codes from 60-150T applying market price to improve the efficiency of the equipment In order to improve the quality of service products, the - company should not only care about investment in modern equipment but also pay attention to the construction of standard storages and sites and invest to make the investigation division as a standard one Maintain ISO system through periodically internal evaluation These are technical and management standards that help the company work in regulation and ensure to bring to the customers equal quality services to satisfy their demands Improve the product quality; create a distinction and - competitiveness among other competitors This is the main strategy to develop company services with the unique and special features, making customer appreciate more than other competitors 4.1.3 Solutio ns to strategy for HR development: - This strategy plays a more and more important role for the existence and sustainable development of every enterprise, especially in such sharp competition among enterprises in the same sectors, local and foreign enterprises Proactively monitor the main HR which is the foundation for competitive capacity of the company - Pay attention to training, improving and developing human resource, especially managers, technicians Provide proper funding for plan of retraining current company staff - Develop clear policies on recruitment, personnel allocation and career development for manger and technician staff 90 - Develop policy on encouraging the labors to self study to improve their expertise, foreign languages such as supporting fee, giving chances of challenging and promotion, increasing income for staff after they complete the course - Implement periodical test of technician profession Apply good benefits for skillful workers like increasing salary steps, promoting to higher positions to encourage them fulfill their expertise - Implement policy of attracting qualified people (for both management and production team) such as: attractive salary and benefits, preferential stocks, timely complement or encouragement, opportunity creation for improving expertise - Develop and apply the policy of paying salary upon capacity and work performance Develop encouragement policy, compensation and benefit program to avoid level mind which does not motivate and fully take advantages of capacity of each individual - Create a convenient working environment for the labors, especially in company’s construction sites 4.1.4 Solutio ns to strategy for organization restructure: - Focus on streamlining, training skilful and good-will staff to effectively cope with other competitors Restructure the organization to make it more suitable for individual production field, among which pay more attention to management limitation at medium level (division, ship groups, construction sites, small enterprises…) so as to ensure the full implementation of decision made by senior levels, develop creative ability of lower level, avoid overlap in management - Arrange the organization structure of branch units to make it more streamlined and ensure a good relationship among divisions of the company to help 91 information being timely transferred Consider appropriate proportion between workload and labor number to avoid the redundancy - Establish marketing team with experienced staff working under the direct supervision of Director Board - Establish a team of research and development (R&D) to conduct researching new products to diversify product type, increase competitiveness and development capacity of the company - Develop a positive working atmosphere to create inspiration for working Timely solve internal conflict based on company objective and benefit - Establish an effective information system to provide timely information on production and business operation of the company, information on market, competitors and HR - Develop a close and effective internal monitoring system 4.1.5 Solutio n to other functional strategies: 4.1.5.1 Solution on management - Organize and rearrange division in the company especially marketing one to make it truly effective and satisfy the current urgent demand of the company - Develop organization culture for the company: The company should develop a style that make people in the company desire to have and fully feel comfortable and together commit to implement their roles Develop, improve the branding and reputation of the company, and make a good image with efficient operation and caring about the development of staff and communities Organization culture of the company was built under a model combining in harmony the professional and principle style with traditional culture values of Vietnam like collaboration and solidarity in production 92 - Take care of training, improving the expertise and management capacity of the company leaders Apply good compensation and benefit program for initiative and committed staff 4.1.5.2 Solution to Finance-accounting: - Conduct monitoring and cost management policies Develop capital using plan and process of cash management The company should have measures to attract capital investment from customers and apply means of payment flexible upon production progress - Focus on restructuring investment list, expanding and developing selected markets which are mainly in Quảng Ninh, Hải Phòng, Đà Nẵng ; focus on handling bad debts and boosting up settlement work; set up risk management fund; give priority to orders with quick liquidity and make the most of the demand stimulus package of the Government, especially take advantages of loans; obtain insurance for activities that the company engages in, asset and risk… - Check and classify the customers upon debt status, plan and draw up policies to collect debt for bad debt so as to solve mobile capital status of the company Make balance; consider stimulation policies for customer quickly to encourage them to help company sell products - Prepare financial plan for each short term and long term period to implement company’s objectives without being passive by capital For the time being, the company should only invest in extension of construction sites in Hòn Gai, Cẩm Phả and Đà Nẵng with modern and uniformed equipment - Complete financial regulation for branch enterprises Periodically conduct internal audit and annually hire independent auditor 4.1.5.3 Solution to research and development - The company should establish the team of research and development to take responsibility of deploying the market development 93 strategy This is a proper and necessary request Therefore, in the coming time, the company should invest in HR and necessary equipment for the R&D team to implement the long term objective of the company For the time being, the company should care about the following issues: Investigate the markets in Central and Southern of Vietnam and in the region; Research and develop construction activities and research investment in river and sea port projects - Set up policies and fund for research and development, stimulate physically and mentally for technical initiatives and valuable research projects Probably recruit qualified experts from external sources and apply good benefits to keep them stay - In order to shorten the time of research to survey new projects, besides self researching, the company should buy the technical copyrights from multi nation companies, large corporation with high technology and good reputation in the world Invest the chain of hi-tech following the principle of going ahead to catch up with the development speed, making a strong development in scale and in depth for the company - In order to avoid the status that invest too much time, money and labor but the projects are not implemented efficiently, the research and development team should also implement other tasks such as: market investigation, trial application, customer’s comments seeking, marketing for the outputs of the service Ensure to implement investment to truly efficient projects to help continue saving and reinvestment In summary: In order to implement successfully the selected strategies, VICD should conduct homogenously these solutions among that, solutions to production, management and finance are the ones determine the success or the failure of these strategies 4.2 CONCLUSION 94 In the context of market economy when globalization and international integration are strengthened, if Vietnamese enterprises in general and VICD in particular want to exist and develop, a good and proper business operation strategy should be proactively built The project “Building development strategy for VICD” to find solutions to the main objectives, namely: 1st objective: Analyze the business environment, identify strengths, weaknesses, opportunities and threats of VICD 2nd objective: Develop and evaluate options of strategy, there from select feasible business strategies for VICD 3rd objective: Propose solutions to reaching the objectives of proper strategies for actual conditions of the enterprise in the period 2010 2015 The achieved result gave the anwser to 1st ojective, including: • The project has achieved the goal of analyzing strengths and waeknesses of the company as well as opportunities and threats from external environment that have influences on developemnt process of the company The relization of these factors helps the company have an onver view on its current situation so as to make proper adjustment steps in short term and for period from 2010 to 2015 • This project has mentioned the important and neccesary factors for planing strategies for the company, particularly when the company has just been established in a short time with not much experiences in the market The achieved result gave the anwser to 2nd ojective, specifically as below: • The project based on analyzing and assessing internal status of the company, and the comparison among competiors under some certain stadards • This project based on analyzing external environment to find out opportunity and threat factors for bussiness operation of the company 95 • In consideration of SWOT matrix in combination with strengths and weaknesses to expolit external chances and limit threat, this project has drawn out specific strategies These strategies not only help the company to develop its operation under its set up objectives up to 2015 but also orient its developemnt in the long term After steps of selection, the proejct proposed solutions to the implementaiton of the overal strategy, specifically: Solution to market development strategy Solution to strategy for improving product quality and distinction Solution to HR development strategy Solution to implementation of organization restructure strategy Solution to implementation of other fuctional strategies In order to successfully implement these strategies, the research group would like to propose some recomendations as follows: 4.3 RECOMENDATIONS 4.3.1 To the State 4.3.1.1 Under the current difficult conditions of financial crisis and economic depression, although Vietnamese Government has applied many measures to support the enterprises to develop their production, the ability of approaching to these preferred policies of the Government of these enterprises is very low due to the shortage of guidelines, homogeneous coordination among ministries, sectors and problems in conducting demand stimulation measures of the Government…To make the economic policies of the Government truly supportive to the enterprises, it should have a homogeneous coordination 96 among ministries and sectors Encouraging policies should be consistent and stable 4.3.1.2 The pressure of competition for foreign enterprises is increased when Viet Nam integrated to the world economy This requires local enterprises to actively conduct investment, improvement, development of machines and equipment… Thus, it is recommended that the State should continue its support to medium and small enterprises of Viet Nam in long term capital loan, tax exemption, import, reduction complicated administrative procedures in investment and construction 4.3.1.3 The State should have policies to macro support for enterprises such as signing the agreement on protecting investment with other countries, supporting legal consultation services for quick and effective implementation of project 4.3.1.4 According to the strategic orientation of shipping industry, equipment localization is a priority program to exploit the best local conditions, improve the efficiency of using sea and river ports … Therefore, the State should encourage investment attraction from internal and external sources of the country for construction areas of river and sea ports, particularly for the development of ship teams that have capacity of conducting big orders; making this industry included in the list of preferential investment 4.3.2 To VICD: During the research process, the project has mentioned some weakness of the company as well as its threats from external environment The proposed strategies probably limit the weaknesses, threats and create conditions to the sustainable development of the company in the coming time However, the implementation of all these proposed strategies is a big pressure Therefore, the company should make a lot of efforts during the implementation of these strategies 97 During its coordination, the management board, director board of the company should study to overcome some existing problems as follows: - The company has not yet had a professional marketing section - The company has not had a research and development division - The company has not paid attention to developing market in the south This is the whole content, analysis, evaluation and recommendation for development strategy of the company VICD to 2015 The group hope that all strategies will be implemented successfully and they will contribute positively in the VICD’s development We would like to send our sincere thanks to the Professional Council for your important opinions about this proposal./ 98 REFERENCES Vietnamese Ass Prof Dr Nguyễn Thị Liên Diệp, MA Phạm Văn Nam (2003), Business Strategy and policy, Statistics publisher Dr Bùi Lê Hà, Dr Nguyễn Đông Phong, Dr Ngô Thị Ngọc Huyên (2001), International 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oriented Marketing, Vietnamese version, Dong Nai publisher 11 Michael E Porter (1998), Competitiveness strategy – Vietnamese version, Statistics publisher, Hà Nội 12 Rowan Gibson edited (2004), Future rethought- Vietnamese version, the Youth publisher 99 13 Philip Kotler (1997), Marketing management, Statistics publisher, Hà Nội 14 Thomas J Peter and Robert H Waterman, Jr - Trần Xuân Kiêm compiled (1998), Searching for Perfection, Đồng Nai publisher 100 [...]... the overall development strategy of VINASHIN, the development of VICD is put within the integration orientation The development of satellite units, the recruitment of local workforce or outsourcing will be applied by VICD in a flexible way in order to make the company business effective 2.2.1.7 Conclusion: With the above micro environment analysis, we can confirm that the opportunities (O) of the company. .. position of company against rivals - High ROI of the business in the future - Value chain analysis of customers, company and rivals Secondly, objective: How the selected strategy helps to achieve the objective? • Thirdly, resources, financial conditions • Fourthly, competence and ability of company: select strategy depending on the quality and levels of difference competencies and ability of company. .. and development, production, human resources, finance, information … to support and ensure the implementation of company strategy and unit competitive strategy It supports the strategy implementation of SBU, corporate strategy and includes: o Marketing strategy o Management strategy o R&D strategy (technology strategy) o Production strategy (service) / operation o Finance strategy o Human resources strategy. .. internal strengths of company to take advantage of external opportunities - Weakness – Opportunity strategy (WO): These strategies improve internal weaknesses of company to take advantage of external opportunities - Strength – Threat strategy (ST): These strategies use the internal strengths of company to avoid or mitigate the influences of external threats Weakness- Threat strategy (WO): These strategies... competitors is very important to a company for different reasons Companies competing with each other decide the characteristics and level of competition or the ploy to gain the advantage in the sector 1.2.1.2.2 Customers (buyers): Customers are an indispensable part of a company The loyal customer is a big advantage of the company The loyalty of the customer is built by satisfying the customers’ demand and... business The unusual changes of Vietnam micro economy in 2008 is also a factor influencing the business of companies In 2008, due to the high inflation and 31 currency depreciation made the company loose tens of billions VND The value of products, services that the company produced but not settled decreased largely Some product value once settled was only 2/3 or ¾ of the value at the point of contract... less influenced by social factors Maybe the social issue that affect the company the most if the awareness level of as well as the attention that the society pays to the business of company 2.2.1.4 Natural factors Natural conditions are factors influencing remarkably to the company operation with great river and port potentiality in Vietnam The increased development of deep water port and maritime transportation... The good information system will facilitate to collect the raw data of the external environment and the internal environment of the company It helps us to keep track of the environment changes, realize the threats as well as support us in implementing, evaluating and controlling strategy Besides that, an effective information system will create other competitive advantages for the company 1.2.2.8 Company. .. resources Therefore, in making strategy and protect the competitiveness, the company should take into consideration maintaining the legal barriers against outsider invasion 1.2.1.2.5 Substitute products: Substitute products are the results of technological and scientific breakthrough The pressure of the substitute products limits the high price of companies in the sector Without taking notice of potential... identifying the time for investment Selecting strategy: Strategy is a long term operating method Therefore, the basic features of the business economic and technological nature need special attention This is different from factors which are short term and affect short term competitiveness and benefits of company Selecting strategy also depends on the culture; politics and the role of strategy management are the