Xây dựng chiến lược nguồn nhân lực tại công ty cổ phần citicom

Xây dựng Chiến lược Nguồn Nhân Lực tại công ty Cổ phần CitiComBUILDING HUMAN RESOURCES STRATEGY AT CITICOM COMMERCIAL JOINT STOCK COMPANY BASIS OF METHODOLOGY OF BUILDING HUMAN RESOURCE STRATEGYThe concept of human resourceCharacteristics of human resources in commercial enterprisesThe connection between business strategy and human resources strategyThe connection between business strategy and human resources strategy

LUÂN VĂN

Xây dựng Chiến lược Nguồn Nhân Lực tại công ty Cổ phần CitiCom

COMMERCIAL JOINT STOCK COMPANY

ACKNOWLEDGEMENT

Through research results and completion of this assignment under StrategicManagement subject, we have gained useful knowledge, valuable lessons whichhelp us to supplementing new knowledge, science research methods associatedbetween theory and practices Knowledge and methods that we achieved fromsubjects of the Program Master of International Business Administration has helped

us very much to complete this assignment as well as to settle our tasks in nearfuture

TABLE OF CONTENTS ACKNOWLEDGEMENT 1

SYMBOL AND ABBREVIATIONS LIST 5

TABLE LIST 6

LISTS OF FIGURES, CHARTS 7

FOREWORDS 8

CHAPTER I BASIS OF METHODOLOGY OF BUILDING HUMAN RESOURCE STRATEGY 11

1.1 Some basic issues of human resources 11

1.1.1 The concept of human resources 11

1.1.2 Characteristics of human resources in commercial enterprises 12

1.2 Basic issues of strategy 13

1.2.1 Concept of strategy and human resources strategy 13

1.2.2 The connection between business strategy and human resources strategy 15

1.2.3 Some strategy analysis tools 17

1.2.4 The meaning of strategic human resource 18

1.3 Process of building human resource strategy 19

1.3.1 Common situation of the market 21

1.3.2 Mission and main objectives 21

1.3.3 Conducting SWOT analysis of organizations 22

1.3.4 Conducted detailed analysis of human resources 25

1.3.5 Selecting human resources strategy 25

1.3.6 Implementing strategy solutions 28

1.3.7 Carry out the results 29

CHAPTER 2 30

BULDING HUMAN RESOURCE STAGEGY AT CITICOM 30

2.1 Overview of Citicom Commerical Joint Stock Co 30

2.1.1 History: 30

2.1.2 Business characteristics 32

2.1.3 Structure, management board organization and departments’ duty 33

2.1.4 Business performance report from 2006 – 2008 35

2.2 Real situation of company’s human resources 36

2.3 Building human resources strategy at Citicom 42

2.3.1 Common situation of steel market 42

2.3.2 SWOT analysis of CITICOM 49

2.3.3 Detailed Analysis of Human Resources: 56

2.3.4 Selection Strategy of Human Resources Management 61

CHAPTER III 68

SOLUTIONS OF IMPLEMENTING HUMMAN RESOURCES STRATEGY IN CITICOM 68

3.1 Vision: 68

3.2 Target 68

3.3 Feasible solutions 68

3.3.1 Organization structure, operation mode: 69

3.3.2 Professional Recruitment 70

3.3.3 Training systematically and effectively 72

3.3.4 Evaluating scientifically and effectively 74

3.3.5 Labor remuneration and labor relations 76

3.3.6 Building a friendly working environment, attaching with company’s culture 77

3.4 Solutions to implement evaluation 80

3.4.1 Opinion surveys 80

APPENDIX 82

APPENDIX 01: SCORE TABLE OF EXPERTS 82

APPENDIX 02: FORM OF HUMAN RESOURCE INVESTIGATION 85

APPENDIX 03: LIST OF INTERVIEWED EMPLOYEE 90

CONCLUSION 92

REFERENCE 93

SYMBOL AND ABBREVIATIONS LIST

- HR: Human resources

- BOD: Board of directors

- BOM: Board of managers

TABLE LIST

Table 1.2: Evaluation of implementation order of the strategy by

GREAT matrix

28

LISTS OF FIGURES, CHARTS

Chart 2.7: Fluctuating world ingot, ingot steel imported into Vietnam

Chart 2.8: Constructive steel production and consumption in the first

FOREWORDS Why choose this topic:

Human resources is an essential issue and is one of key points of productionforces Manpower is basic decision because it answers the question: Who

When the economy is growing, investment and business, speed dial quickly,technology is modern, production methods is innovative, social production level israpidly transferring from the automatic economy to the knowledge economy Thoserequire higher and higher quality workforce Human resources not only meetquantity issue but also ensure quality of production forces And human resourcescan self-activate and develop itself besides production

Therefore human resources management is very important to the existence anddevelopment of enterprises One of the duties of Human Resource Management is

to build human resources strategy Human resources strategy decides success ofbusiness strategy and company strategy Most of failures in business and personnelmanagement are due to lack of a true Human Resources strategy or lack of properimplementation Building human resources strategy brings business more practicalbenefits:

- Define clear goals for each stage of enterprises’ business; help enterprisesfind clear directions in the future to reach set targets

- Assist the business managers, human resource managers to see clearly theopportunities and challenges from outside, the real situation, strengths andweaknesses of enterprises; forecast changes in the future to have the activemeasures to deal with new environment

- Human resources strategy helps enterprises exploit and use up their humanresources; maximize the power of enterprises to development

- Helps enterprises increase the cohesion and consensus between staff andleaders in implementing company’s common objectives

- Helps enterprises increase labor productivity, increase administrativeefficiency; avoid risk and increase prevention and stopping difficulties happening toenterprises

Study methods:

Study methods which were applied in this topic are as following:

- Leaders of Citicom’s Board of Directors has have overview, the latest status

of real situation of human resources at the company

And finally, through the group's research results, the company has gainedvaluable and practical human resources strategy

Topic:

“BUILDING HUMAN RESOURCES STRATEGY AT CITICOM

COMMERCIAL JOINT STOCK COMPANY”

CHAPTER I BASIS OF METHODOLOGY OF BUILDING HUMAN RESOURCE

STRATEGY

1.1 Some basic issues of human resources

1.1.1 The concept of human resources

Human resources is referred to "full professional level which people areaccumulating and able to bring income in the future (Beng, Dornhusch & Fischer,1995) Human resources, according to Pro.Pham Minh Hac (2001) is the overallpotential labor of a country or a local willing to join a job somehow

As defined by the United Nations, human resources is the level of skilled,knowledge and capabilities of all human life on the reality or potential for social -economic development in a community

Human resources, on narrow meaning and to be countable in planning isdefined a part of population in Vietnam Based on that, some of Vietnamesescientists specified that human resources or resource of human consists labor forceand labor reserves The labor force is defined as working labor and people inworking age willing to work but got no job (the unemployed) Labor reservesinclude students in the working age, people in working age but not in need of labor When mentioning about human resources, we talk about the level, structure,capability of meeting the requirements of labor market Quality of human resourcesreflects in the level of knowledge, skills and attitudes of labor The classification ofhuman resources by industries, fields (industry, agriculture, services) are verypopular in our country today But when switching to the knowledge economy, laborclassification by accession in their job, career will be more suitable So, we canclassify workforce into five categories: knowledge labor, management labor, datalabor, services labor and production labor Each type has its different contribution tothe creation of products Concentration of knowledge and intelligence high or low

in labor product depends mainly on the contribution of knowledge labor,

informed labor is very high in the structure of labor force, so product contains lowintelligence In order to increase competitiveness in international markets, ratio ofintelligence in the goods need to be stimulated in the near future

1.1.2 Characteristics of human resources in commercial enterprises

In three basic elements of all business processes of enterprises, human andtheir activities (employees) are the most important factor Not only themanufacturing sector requires physical labor demand but circulation of goods alsorequires this to circulate goods from production areas to consumption areas As themomentum of development, advancement of social production forces, circulations

of goods is expanding and ensuring more and more full, timely, synchronous andcivilized goods for consumption Hence, this requires labor force in business sector

to be increased This is essential force of the whole social activities This type oflabor plays a role of transferring goods from production areas to consumption areas.Increasing or decreasing of the proportion of this type of labor depends on thedevelopment of production forces in society, labor productivity, the managementmechanism of the national economy

Like workers in material producing enterprises and one in commercialbusiness take an important position and characteristic in the process of businessactivities of enterprises

The first, labor in commercial enterprises is one of three basic elements and

moreover key factor of business activities Without people with specific level ofprofession, technical profession, the whole machine enterprise couldn’t operate it.Elements of capital, assets are only necessary conditions for the process of businessactivities to be done

The second, labor in commercial enterprises which is a key factor creates new

value Improving labor productivity in commercial enterprises that is the basicreason, determine business efficiency of the enterprise Scale profit, profit growth ofthe enterprise depends mainly on management workforce of the enterprise

The third, working efficiency in commercial enterprises is also limitedly

influenced by factors such as working time, physical, intellectual and otherpsycho physiological factors

However, because of particular characteristics of commercial enterprises,labor here has specific characteristics Those don’t perform the function of creatingnew products but primarily perform the function of transforming morphologicalvalue of the product It is the one who buy goods to do business in order to meet theneeds of production and consumption In other words, labor in commercialenterprises performs services for manufacturers and consumers Labor in this area isperforming the function to continue production process in goods circulation stage,performing the function of original circulation, moving product from the seller (theproducer and business) to households (units individual consumer, other commercialbusiness)

Studying above mentioned characteristics of labor in commercial enterprises isvery important to develop human resource strategies, planning salary policyworking regimes, recruitment, training policy and developing human resources incommercial enterprises

1.2 Basic issues of strategy

1.2.1 Concept of strategy and human resources strategy

In competitive world, sometimes it’s wondered why some companies succeedbut others fail? In fact, each enterprise has their way to survive and grow To findout how companies in different sectors, with various conditions and circumstances,the development of strategies how to win competitive advantage we mustunderstand the concept of strategy first

According to the traditional way, strategy is defined as follows: "Strategy isthe study to find a competitive suitable position in an industry, a scope wherecompetitive activities are taking place.” by Michael Porter “Strategy, in his point ofview emphasizes to competitiveness corner”1 According to Alfred Chandler2

"Strategy is the determination of the fundamental goals in long-term of companies,the action plan with the allocation of necessary resources to achieve those goals James Quinn of the Darmouth University defines: "Strategy is a sample or plan of

an organization to coordinate the decisive targets, policies and order of actions in aoverall unity”3

Building strategy by planning method is not suitable anymore In that context,modern points of strategy were born and gradually replaced traditional ones.Strategy by modern point attempted to return to the nature of the term strategy and

to ensure the adaptation of this term with changeable business environment.Therefore, the strategy modern point doesn’t emphasize on calculation and planningbut on the selection of proper strategies with established objectives of theorganization

Johnson and Scholes define strategies in the conditions that environment has alot of fast changes "Strategy is the direction and scope of an organization to gainlong term competitive advantage for organizations through its resources inchangeable environment changes, to meet market needs and meet expectations ofgerm stakeholders "(Johnson, G Scholes, K (1999) Exploring Corporate Stratery,5th Ed.Prentice Hall Europe)

Not only includes many different aspects, definition of strategy is also various

by level The exact definition of strategies by level depends on point of view Thereare 3 levels of strategy at least need to be identified:

+ Company strategy level (or general strategy): This strategy is built for

overall company’s system in all areas that company involved in Objectives in thisstrategy show company’s goal on entire operation that company pursued inoverview and the direction and measures to reach that goal as well

+ Business strategy level (field): Built for a narrow specialized business In

case that company business just involved in a field that we can say business strategylevel is called strategic for the company strategy level

+ Functionality strategy level: This is the strategy of each individual function

in the company such as finance, marketing, human resources it can be seen assupporting strategy in order to successfully implement the company strategy leveland business strategy one

Human resources strategy of enterprises is one of functionality strategy level.It’s an important strategy which decides success of other company’s strategies

1.2.2 The connection between business strategy and human resources strategy.

For small and medium size companies, quality of employees plays an essentialrole to decide success in business It’s the human factor that creates productivityand working efficiency which makes quality performance of whole enterpriseimproved Moreover, “successful candidates” of an enterprise or any organizationwill create business culture that can make their own difference and highlightposition compared wit their competitors

Unlike other resources such as financial or property, human resources is whatcreates the enterprise and lead development direction of the enterprise, whilefinancial resources is still only a means to achieve goals set up

Business strategy of any enterprise also shows objectives to make and it is theparameters to evaluate the performance of enterprises Business strategies can bedefined as many different forms and be measured by various indicators such astargets for production, marketing and implementation of financial functions whichhave been coordinated In most cases, enterprises often did not notice to considerthe connection between business strategy and human resources strategy, betweenplans and performance

We all recognize that managing people is much harder than operating themachine with buttons and switches On the other hands, people are not robots; eachone has different advantages, disadvantages of themselves, how to handle differentjobs and different abilities If selected carefully and well managed, human factor of

Competitiveness

based on low cost

 Detailed training and practicing

 Give priority for research and development

 Focus on reputation, quality of products and services

 Attract intelligent and skilled

 Job description

 Supervising staff should not be so detailed

jobs

 Assigning jobs for group, not for each individual

 Pay by ability and profession of each employees

Evaluation of working

develop

1.2.3 Some strategy analysis tools

Building process and analysis strategies can be supported by some followingtools:

1.2.3.1 SWOT analysis

Model SWOT analysis is a useful tool for comprehension and decision making

in every situation of any business organization It’s abbreviated by 4 letters:Strengths, Weaknesses, Opportunities and Threats SWOT provides a strategicanalysis tool, review, evaluate position and orientation of a company or a businessproposal SWOT which is suitable to working and analysis group, is used inbusiness planning, building business strategy, human resources strategy, evaluatescompetitors, marketing, product and service development Literally speaking,SWOT is a theory framework which we base on to review stated strategies, specifyposition and direction of an organization or a company, to analyze any businessproposal or any ideas related to interests of enterprises In fact, the application ofSWOT in building a business plan, evaluating competitors, market surveys, productdevelopment and in research reports are chosen by more and more enterprises

Strengths: What is your advantage? What’s the work you do best? Which

resources do you need to use? What’s the most advantage that others can see inyou? You must consider problems from your own view and others’ Advantages areusually formed when compared with competitors

Weaknesses: What things could you improve? What’s the work you do

worst? What should you avoid doing? You must consider problems based on insideand outside Others may see weaknesses that you aren’t seen by yourself Whycompetitors can do better than you? At this moment, you should have a realisticacknowledgement and face the truth

Opportunities: Where are good opportunities? What interested trend that you

knew? Opportunities can stem from changes in technology and market that

whatever is international of or even in narrow spaces, from changes in state policyrelated to company’s business field, from changes in social patterns, populationstructure or fashion structure , from events taking place in the region

Threats: What obstacles you’re facing? What are competitors doing? Is there

any change in specific requirement of work, products or services? Changes intechnology cause any risk with your company? Is there any problem with yourcompany’s overdue debt or cash flow? Is there any weakness threatening yourcompany?

1.2.3.2 PEST Analysis

Meanwhile, PEST model research impact of all factors in macroeconomics.They are Political (Politics; institution, law); Economics (Economy); Sociocultural(Culture – Society); Technological (Technology

Here are four factors that directly influence on economic sectors These areexternal factors of enterprises and industries, and that industry has to suffer itsimpact provide as an objective factor Enterprises make their policies, businessoperations accordingly based on those impacts

In business strategy analysis as well as human resources strategy, we often usecombination of SWOT analysis and PEST analysis

1.2.4 The meaning of strategic human resource

Human resources is an essential issue and is one of key points of productionforces Manpower is basic decision because it answers the question: Whomanufacture and operate machinery and technology?, Who create products, values?When the economy is growing, investment and business, speed dial quickly,technology is modern, production methods is innovative, social production level israpidly transferring from the automatic economy to the knowledge economy Thoserequire higher and higher quality workforce Human resources not only meetquantity issue but also ensure quality of production forces And human resourcescan self-activate and develop itself besides production

- Define clear goals for each stage of enterprises’ business; help enterprisesfind clear directions in the future to reach set targets.

- Assist the business managers, human resource managers to see clearly theopportunities and challenges from outside, the real situation, strengths andweaknesses of enterprises; forecast changes in the future to have the activemeasures to deal with new environment

- Human resources strategy helps enterprises exploit and use up their humanresources; maximize the power of enterprises to development

- Helps enterprises increase the cohesion and consensus between staff andleaders in implementing company’s common objectives

- Helps enterprises increase labor productivity, increase administrativeefficiency; avoid risk and increase prevention and stopping difficulties happening toenterprises

Hence, "Human resource strategy is a process that combines the function ofhuman resources with strategic goals of an organization to improve performance"(John Bratton - Human resource management strategy)

Especially when the company focused on business strategy of high-qualityspecialized steel products in mechanical manufacturing industry high strength steelused in the hydropower plants, shipbuilding industry…

1.3 Process of building human resource strategy.

Normally, the strategy is understood as the result of a reasonable plannedprocess which is arrangements carefully Until now, scientists in management,

scientific strategies and administrators have proposed many models of strategicplanning Each model has a format for the entire strategic management processbased on some concepts mentioned above However, the revision of planningprocess as a starting point is useful for our journey into the world of strategy

Process of building strategies can be divided into seven steps (Figure 1.1),including:

Figure 1.1: Process to formulate strategies

- Step 1: Common situation of markets;

- Step 2: Choose mission and main objectives of the company;

- Step 3: Conduct SWOT analysis of human resources (analyzing external

environment to identify opportunities and threats; analyzing internal environment to

Function, Duties and strategic objectives of

enterprises

Analysis of internal enterprises (S, W)

Analysis of external environment (O, T)

Selecting strategies

Company strategy Business basis strategy and functional

department

Implementation of strategies

Examination and evaluation performance

Feedbacks

- Step 4: Conduct detailed analysis of human resources;

- Step 5: Selecting of human resources strategy (based on searching for

resources, possibilities and core capabilities then develop it to neutralize threats,take advantage of opportunities from inside and outside environment);

- Step 6: Develop solutions to implement the strategy;

- Step 7: Examining and evaluating th implementation.

Strategic plans which are created by this process usually covers the period of 5years, and is updated annually Thus, planning strategy is orienting resourcesallocation in an organization Detailed steps of building human resources strategyare as following:

1.3.1 Common situation of the market

- Need to mention on some issues: technology, products, distribution,competition in market in general and of industries in particular sectors

- What factors affect to company’s business operation?

- What factors determine company’s business?

When considering the panorama of the market, how company's humanresources will be to meet operation requirement of the company To get strongcompetitiveness, human resources is required to have management qualification,professional qualifications, skills Also, working environment of the company hasenough attraction to keep talented staff This will be a premise for company’scompetitiveness

1.3.2 Mission and main objectives

In the context of fierce competition, business strategy of each company mustalso be changed to be suitable and adapt to each different stages

Company's mission is a concept used to define purposes of the company, thereason of establishment and existence basis, development of that In fact, themission statement of the company only focuses on clarifying an important issue

"What does company’s business aims to?" Scope of the mission statement oftenrelates to products, markets, clients, technology and philosophy that other

companies are pursuing So it can be said that it’s the mission statement that showsthe meaning of an organization’s existence, that they want to become, customersthey want to serve, that methods they want to work…

Objectives of an organization can be considered as the reason for the existence

of such organizations Therefore, the approach of strategy makers with objectiveswill create orientation for forming strategy process and impact to contents ofstrategy

Target show clearly specific direction to pursue, it affects all kinds of businessactivities Target is also a driving stimulating force Target is used as a tool ofevaluation and controlling It allows company to check out proposed results whetherthey are suitable with set out requirement or not, allows to act properly to achievedesired results, consolidate responsibilities in the job

Target with a central role is the result of the comparison For each enterprise,objectives can be long term, medium term or short term Economists assume thatcompanies set up their objectives in eight following major areas: market reputation;Innovation; Productivity; Source of finance and logistics; Profit, Developing andEmployee’s performance; Attitude and workers’ performance; Responsibilitytowards society

Since then, Personnel Department will orientate specific requirements,strategies of their own departments based on each aspect, function that departmentare responsible for, will analyze through different analysis tools to build aharmonious human resources strategies to meet business strategy of the company

1.3.3 Conducting SWOT analysis of organizations

Analysis of external environmental is to identify opportunities and threats;analysis of internal environmental is to identify strengths and weaknesses of thecompany

1.3.3.1 Analysis of external environment

Figure 1.2: The external environmental factors

External environment is the main factors could affect the implementation ofenterprises’ objectives to achieve The objective of external analysis is to aware ofopportunities and threats from outside environment Analysis of externalenvironment includes macro-environmental analysis and industry environment Theanalysis of these factors help enterprises to identify their position and characteristics

of environment, but current age that they are living, forming effects externalenvironment on enterprises, enterprises’ targets and especially human resources.Since then, enterprises can have decision in planning human resources strategy inorder to exploit opportunities and minimize threats

Macro-Environment: consists of many different factors that impact indirectly

or directly to operation and human resources of enterprises through its impact onindustry environment factors Of these, there are five factors are evaluated as the

Economics factor

Enterprises’

internal environment

Technology

factor

Politics factor

Nature

of substitute products (Figure 1.3)

Figure 1.3: The decisive factors of industry competition

Potential competitors

Competitors in industry

Competition between enterprises in industry Substitute product

Customers Providers

Threats of new competitors

Threat of substitute of product and service

Possibility of pressurizing of customers

Possibility of pressurizing of

providers

1.3.3.2 Analysis of internal environment.

The ability of enterprises is a basic factor to decide what companies can do,business strategies and functionality level strategy can be successfully implemented

or not To ensure the feasibility of strategy, we have to evaluate real situation,indentify strengths, weaknesses when building strategy Through this, we canidentify real ability of human resources of enterprises They are professionalqualifications, experience, skills and ethics of employee; etitive advantages ofenterprises, personnel policies, balancing ability between using workers atmaximum and minimum level; capability, concern level and management ability ofsuperior leaders Also, we need to analyze other factors such as: evelopmentresearch, production, finance, marketing; how they affect human resourcesmanagement of the company

1.3.4 Conducted detailed analysis of human resources.

Based on analysis of external factors: strengths, weaknesses, opportunities andthreats, we will focus on analyzing internal elements of enterprises (CORP) Theyare corporate culture, working organization in enterprises, people and operatingsystems in enterprises From here, we can consider whether personnel work of thecompany is in which position; and how company wants to have their humanresources and what company needs to do with current human resources

From analyzed four aspects of culture, organizations, human and humanresources systems, we can make human resources strategy which is able to fulfillshortcomings to contribute to common company’s success in their business strategy

1.3.5 Selecting human resources strategy.

Before deciding to choose which human resources strategy, we need toconsider business strategies that business department is building, examining SWOTanalysis and CORP to make connection between business strategy and humanresources strategy and building a table summarizing issues which managers andPersonnel department need to reform their human resources

From the SWOT analysis of company’s human resources, the company exploitstrengths to focuses on analysis of the human resources of the company, takeadvantage of strengths to optimize company’s business objectives, to limit theirweaknesses to successfully implement targets set out first, using all opportunities toreach the final objective and nullifying threats so that company’s success is full

At the same time, company pointed out different threats and weaknesseswhich made specific affection on human resources management strategies thatcompanies are expected to build

Table 1.1: SWOT matrix analysis of the company

1

2

Combination S/T

(Using strengths toovercome threats)

2

Combination W/T

(Minimizing weaknesses and threats)

1

2

to reduce the damage dangers due to the external risks

W-T Strategy: To form a defense plan to prevent the Company’s mainweaknesses from vulnerability by the outside dangers

From above analysis, the company needs to choose which strategy to carryout first and then, how is priority? Strategy is a system of big policies and solutions

to carry out and combine with action programs Enterprises need to select optimalstrategies because all strategies can not be implemented at the same time or eachstrategy can not be implemented in careless order as it’s a waste of time, material,human Hence, enterprises need to have good choice to gather the most optimalstrategy to develop and consider advantage or disadvantage that company can gainfrom this strategy

On the basis of gathering strategy which is pointed out by combination offactors: strengths – weaknesses; strengths – opportunities; weaknesses –opportunities; weaknesses – threats; using matrix by Great criteria to sketch basicfeatures for the selection of human resources strategy that enterprises are pursuing

Table 1.2: Evaluation of implementation order of strategy by GREAT matrix.

Step 3: Evaluating and marking points for each analysis point in each

strategy, evaluating point from 1 to 5 with levels: Weak, medium, pretty medium,pretty, good

Step 4: Changing coefficients as result of two columns (column two and

evaluating column in evaluating points in each strategy) and then plus all partiallresults to total at the last row

Last: choose from 1 to 3 highest total score and it’s central strategy should be

focused on implementation

1.3.6 Implementing strategy solutions

For each important issue, we need to highlight implementing solutions Also,

we have to consider the combination of functional division within the company togive out solutions and how to implement them Solutions to improve culturecorporate environment, communication at offices, recruitment, training anddevelopment or payoff mode, human resource planning

From those issues and important solutions, we need to make implementationpland set up roadmap to implement objectives and solutions

1.3.7 Carry out the results

The purpose of the examining and evaluation is to guide activities or to planhuman resources in the following areas: quantity and quality of staff; laborproductivity, rate of transferring employees, especially new members; recruitmentcosts for some employees; employee’s satisfaction in work to indentifydifferences between planning and implementation, causes of those differences and

to propose completing measures The ultimate goal of a human resources strategy is

to ensure that those items must support and impact each other; at the same time howthese goals affect implementation of functional strategy and business strategy,company strategy

General conclusion: In essence, building human resources strategy aims tocapture "human factors" of an organization, helps achieve immediate and long-termgoals, ensures that the correct use of right person right jobs; promotes staff’squalification and skills; considers attitudes and behaviors of employees to haveproper training and development orientation and evaluates employees fairly in order

to attract and retain talented staff for the implementation of strategies and objectives

of the company

CHAPTER 2 BULDING HUMAN RESOURCE STAGEGY AT CITICOM

2.1 Overview of Citicom Commerical Joint Stock Co.

2.1.1 History:

- Type, name and location:

Company name: Commercial Joint Stock Company

Foreign Trade name: Commercial Joint Stock Company

Abbreviation: CITICOM

Citicom which is a kind of joint stock run under Enterprise Law and other

current regulations of Republic Socialist of Vietnam

Location: 7th Floor, Dai Phat Building, Pham Hung Road, Hanoi

- History:

CITICOM was officially founded on 1 June 2003 under Certificate ofBusiness Registration number 0103002300 on 23 May 2003 by Hanoi Authority forPlanning and Investment Its major business is exporting, importing and consumingindustrial steel products

First registered charter capital of Citicom is VND 3.200.000.000 contributed

by founders, details as following:

Table 2.1: Capital contribution ratio of Citicom’s founders

charter capital

Since foundation until now, Citicom have increased charter capital 3 times:First time on 2006, increased up to 24 billion VND

Second time on 2007, increased up to 32 billion VND

Third times on 2008, increased up to 45 billion VND

During that time, Citicom set up more branches and representative officies insome cities, provinces where demand of steel consumption is high and often toserve consumers more options Especially in 2008, Citicom respectively establishedrepresentative offices in Hai Phong, Ho Chi Minh City and a branch in Hanoi.Nowadays, Citicom is building Steel structure and synchronous equipments factory

at Hai Duong province which planned to go into operation in December

Under talented management and experienced engineers, ages of importing steel products together with widespread warehouse and sales networks,Citicom nowadays is one of biggest private enterprise leading in industrial steelconsumption in Vietnam

exporting-In terms of importing: main imported product is steel Citicom is leadingcompany in penetrating Chinese steel market – one of the most biggest anddiversified market on the world Nowadays, Citicom have established a closerelationship with some Chinese suppliers such as: BaoSteel, Wuhan Iron & Steel,Hebei Iron & Steel, Jiangsu Shagang, Angang Steel Citicom is also a sole agent ofabove mentioned Chinese companies of industrial steel products in domesticmarket At the same time, Citicom have established a close and trustworthyrelationship with many foreign enterprises such as: Russian, Korean, Indian andMalaysian that helps Citicom have more supplying source and diversify theirproducts with competitive importing price…

In terms of exporting: main product is cast iron and current exporting market

is Taiwan, Malaysia and Spain Citicom’s products are competitive price, highquality and highly evaluated by customers

Citicom’s slogan is: Solidarity – Effeciency– Development.

2.1.2 Business characteristics.

- Major business section: Citicom specializes in exporting and importing

industrial steel products; manufacturing and selling metallic products (black metaland color metal); industrial chemical substance, equipments, spare parts,motorcycles, textile products, garments, wood and wooden products, coal, ores,minerals, consuming goods, …

- Main business products: Key products of company’s business strategy are

specialized high-quality steel used in mechanical manufacturing industry; highstrength steel used in the hydropower plants, shipbuilding industry…

- Distribution methods: 60% of imported products are direct-sales,

whole-sales by orders, economic agreements of demanded domestic consumers The rest40% which is key products such as produced-steel, alloy, Q345B, steel forshipbuilding are to serve domestic manufacturers

- Customer networks: Citicom has established a wide network of strategic

and close customers

+ Mechanical manufacturers: Pho Yen Mechanical Company, Diezen RedRiver Company, MEIFA Jsc Co., Tran Hung Dao Mechanical Company, Mao KheMechanical Company,…

+ Structuring manufacturers: Zamil Co., PEB Ltd., Co., Kirby Ltd Co.,…+ Hydroelectric building: Head of mechanical and industrial equipmentcompany (MIE), Mechanical Irrigation Company,…

+ Commercial customers: Nam Vang Co., Nam Phat Co., Dai Phat Co., TanDai Phat Co., Hanoi Metallic Jsc Co.,

2.1.3 Structure, management board organization and departments’ duty

2.1.3.1 Structure of Citicom:

2.1.3.2 Management Board:

Board of Directors (BOD): are voted by shareholders’ meeting BOD has the

right to decide all issues related to target, company’s interest on behalf of Company,except for issues under shareholder’s meeting decision

General Director (GD): voted by BOD who can be among BOD or another.

GD who is head of Board of Managers, govern all daily operation and report toBOD all rights and duty assigned

BOARD OF DIRECTORS

BOARD OF MANAGERS

EXPORTING – IMPORTING DEPT.

FOCUSED BUSINESS DEPT.

ACCOUNTING DEPT.

HANOI

BRANCH

HAI PHONG REPRESEN TATIVE OFFICE

HCMC REPRESEN TATIVE OFFICE

WAREHO USE AT DUC GIANG, LONG BIEN

WAREH OUSE IN HAI PHONG

WARE HOUSE

IN HCMC

ADMIN &

FOREIGN

AFFAIRS DEPT.

2.1.3.3 Function and duty of Departments:

* Admin & Foreign Affair Dept: responsible for offices operation and taking

care of foreign guest, filing documents, providing materials and devices, control andperform all stipulation, guiding guests…

* Focused Business Dept: Watching and serving all demand of customer,

usually keep posted information and ready for business targets of whole companyfrom domestic sources; building stable domestic sources Watching and performingall bidding orders after getting approval of BOM Responsible for logistics,transportation, market demand, balancing inventory, sales promotion policy…

* Accounting Dept: under direct management of BOM, consulting for

General, managers how to govern financial – accounting operation effectively,evaluate assets, cash flow… Periodically collect, provide information tomanagement about changeable capital resources, capital, effectiveness of usingassets, materials, cash flow…investment consulting; mobilizing capital resourcesfor timely manufacturing according to current regulation; coordinating with otherdepartments regarding accounting, finance, salary

* Exporting – Importing Department: Seeking information of abroad

market to set up plan and exporting – importing project and other related plans ofhead office.; consulting General Director in foreign affairs, exporting – importingpolicy, Vietnamese and foreign law in this field; assisting General Director toprepare all necessary procedures, agreements, international payment and otherforeign trading issues Following and signing exporting – importing contracts oncompany’s authority Researching, analyzing and evaluating potentiality of foreignpartners when company intend to joint business with Assisting General Director towelcome guests, negotiate and sign contracts with foreign customers Collectinginformation in order to expand international market

* Citicom branch in Hanoi and Representative office in Hai Phong, HCM:

Preservation commodity, assets, materials and equipments assigned; receiving

import shipment at seaport Exporting, importing according to approved project;direct selling at warehouse according to assigned plan

2.1.4 Business performance report from 2006 – 2008

During period 2006 – 2008, though world economy and domestic one werefluctuated a lot, Citicom still achieved optimistic business performance asfollowing:

Table 2.2: Business performance report from 2006 to 2008

Unit: Million VND

Quantum Quantum Comparision

7 Profit rate/equity 28,49% 21,06% -7,43% 22,51% 1,45%

8

Profit

Most of financial targets of Citicom growed obviously from 2006 to 2008

- Charter capital of the company in 2006 was only 24 billion VND, butincreased to 32 billion VND by 2007 and 45 billion VND by 2008 The average

Total assets of Citicom at the end 2008 is 322 billion VND, up 40% comparedwith 2007 (in 2007, total assets of 230 billion VND), and up 122% compared with

2006 (in 2006, total assets was 145 billion VND)

Citicom is one of big enterprise importing and distributing industrial steel inthe Northern market, with revenue in 2006 was 498 billion VND In 2007, revenuewas increased up 24% equivalent to 618 billion VND Especially, 2008 is a toughyear impacted by economic crisis Yet, Citicom’s revenue still achieved remarkably

899 billion VND, with an outstanding growth over 2007 is 46 %

- Evaluation of company’s business, we easily see this through the target profitrate after tax / average equity in three years is 24% Economic crisis in the worldand Vietnam has caused many losses to enterprises, not Citicom out of them Profitrate / revenue in 2006 was 28.49%, but only remains 21.06% in 2007 In 2008,Citicom tried their best to overcome many difficulties to maintain domestic marketshare of steel distribution However, profit rate / equity did not increasesignificantly compared with 2007 and holding at 22.51% (Equivalent profit after-tax

in 2008 was 15 billion VND)

Conclusion: Thus, the financial situation of Citicom is very stable Financial

indicators of next year are higher than one of previous years These show thatdirection of business strategy of company’s leaders is right The effort to unite staffshas helped Citicom to achieve set up objectives

2.2 Real situation of company’s human resources

Till 30/9/2009, total labor of Citicom is 44 persons, details of labor structure

by gender, age, education… are as following:

Allocation by gender:

+ Male

+ Female

2717

61%39%

39%34%18%9%

5%41%34%9%11%

Allocation by professional qualifications

+ Finance accounting

+ Foreign Trade

+ Business administration

040407

9%

9%

16%

2%

23%

Allocation by working experience:

+ Less than 5 year

+ 5 – 10 year

+ Over 10 year

052613

direction of increasing the number of professional labor (See Chart 2.1: Labor structure by labor assignment)

Chart 2.1: Labor structure by labor assignment

About gender allocation, rate Males constitute 61% of staff, while female staff

is 39% is not balanced and proper with the specific business of the company is to

Female in the room, branch and representative office for a reasonable (See chart 2.2: Labor structure by gender).

Chart 2.2: Labor structure by gender

Total number of employees of the company has trained 38 people is 88%occupied, including the College level, University and the Post graduate is 35,accounting for 80%, only 9% are high school level, but there to 11% of staff not

trained (See Chart 2.3: Labor structure by type of training)

Chart 2.3: Labor structure by type educations

Trained staff specialized in foreign trade was 4, accounting for 9%, businessadministration is 07, accounting for 16%, specialized techniques and technology is

18, accounting for 41% and the rest of another sectors is 15, accounting for 34%.Although the company business is mainly commercial specialized rate structure isnot a professional foreign trade, economic take up to 75% That rate is notreasonable, necessary adjustments are in ascending gradual rate of professional staff

on foreign trade, economic (See Chart 2.4: Labor structure by professional qualifications).

Chart 2.4: Labor structure by professional qualifications

In terms of Age, age 20-30 is majority with 17, accounting for 37% The least

is from age 50-60, with 4 people, accounting for 9% Overall, the ages 20-40 is 32,accounting for 73% while the age of 40-60 id only 12 people accounting for 27%,which shows the age distribution is fairly balanced and inheritance

(See Chart 2.5: Labor structure by age)

Chart 2.5: Labor structure by age