Xây dựng chiến lược kinh doanh công ty cổ phần khoáng sản VIGACERA

external factors in an effort to pursue strategies for the use of the opportunities outside as the stable rate of economic growth, improve the business environment, and take advantage o

LUẬN VĂN Xây dựng chiến lược kinh doanh công ty cổ phần khoáng

sản VIGACERA THESIS MBA

BUILDING BUSINESS-LEVEL STRATEGY

VIGLACERA MINERAL JOINT STOCK COMPANY

PERIOD 2015 - 2020

HANOI, 2010

TABLE OF CONTENT

LIST OF ABBREVIATIONS 5

LIST OF TABLES 6

LIST OF FIGURES, GRAPHS 7

INTRODUCTION 8

1 Rationale of the Study 8

2 RESEARCH OBJECTIVES 9

3 SCOPE OF STUDY 9

4 STUDY METHODOLOGY 9

5 REPORT STRUCTURE 9

Theoretical BASIS 10

1.1 BUSINESS STRATEGIES FOR BUSINESS 10

Figure 1.1: Business strategy 12

1.2 SELECTING AND PLANNING BUSINESS STRATEGY 14

Figure 1.2: Strategic planning process 17

Figure 1.3: Macro Environment 20

Figure 1.4: PEST model 21

Figure 1.5: Michael Porter's five forces of competitive position model 22

Figure 1.6: Value chain 24

Figure 1.7: Map SWOT analysis 26

Figure 1.8: SWOT Matrix 28

Figure 1.9: IE Matrix 31

ANALYSING CURRENT STATUS OF 36

VIGLACERA MINERAL JOINT STOCK COMPANY 36

2.1 ABOUT COMPANY 36

Figure 2.1: Organizational models of the Company 37

2.2 ANALYSIS MACRO ENVIRONMENTAL AFFECTING ACTIVITIES OF THE COMPANY 46

2.3 ANALYSIS INDUSTRY ENVIRONMENTAL AFFECTING ACTIVITIES OF THE COMPANY 50

2.4 OPPORTUNITIES AND THREATS FOR COMPANY 58

external factors in an effort to pursue strategies for the use of the opportunities outside as the stable rate of economic growth, improve the business environment,

and take advantage of opportunities for competitors 60

However, the Company should pay attention to factors affecting the success of the Company that the Company also hasn’t a good response as interest credits, recruitment, and some general policy of the State on minerals 60

2.5 INTERNAL ENVIRONMENTAL ANALYSIS AFFECT ACTIVITIES OF THE COMPANY 60

Figure 2.4: Map technological lines of the Company 63

Figure 2.5: Positioning the companies in the market 66

2.6 STRENGTHS AND WEAKNESSES FOR COMPANY 69

Through Table 2.8, shows the total score of 3.13, higher than the average level of 2.5; which the Company has an environment with good internal strength such as application of new technologies for production, experience and production activities, brand goods, customers, service after sale, and management This is the core competence of the Company 71

However, still many weak points such as price, production capacity, distribution, training and developing human resources 72

2.7 ANALYSIS OF IE MATRIX 72

From EFE Matrix and IFE Matrix, position the Company in IE Matrix as follows: 72 Figure 2.6: IE Matrix of Company 72

Currently, the company is in cell I Company should develop and build strategy This means to carry out an extensive strategic and positive Strategy should focus on market penetration, market development and product development 72

2.8 SWOT ANALYSIS 72

SELECTION OF STRATEGIC BUSINESS 78

AND PROGRAM IMPLEMENTATION 78

3.1 CRITERIA OF SELECTION STRATEGY 78

3.2 RESULTS EVALUATION SELECTION STRATEGY 78

3.3 ACTION PROGRAM IMPLEMENTATION STRATEGY 84

3.4 SOLUTIONS IMPLEMENTATION STRATEGY 84

CONCLUSION 89

REFERENCES 90

LIST OF ABBREVIATIONS

FX The symbol of feldspar bone products

FM The symbol of feldspar enamel products

FK The symbol of feldspar glass products

ASEAN Association of Southeast Asian Nations

SWOT Strength - Weakness - Opportunity - Thread Analysis

IFE Internal Factor Evaluation Matrix

QSPM Quantitative Strategic Planning Matrix

LIST OF TABLES

LIST OF FIGURES, GRAPHS

Figure 1.1: Business strategy 12

Figure 1.2: Strategic planning process 17

Figure 1.3: Macro Environment 20

Figure 1.4: PEST model 21

Figure 1.5: Michael Porter's five forces of competitive position model 22

Figure 1.6: Value chain 24

Figure 1.7: Map SWOT analysis 26

Figure 1.8: SWOT Matrix 28

Figure 1.9: IE Matrix 31

Figure 2.1: Organizational models of the Company 37

Figure 2.4: Map technological lines of the Company 63

Figure 2.5: Positioning the companies in the market 66

Figure 2.6: IE Matrix of Company 72

1 RATIONALE OF THE STUDY

In recent years, Vietnam's economy moves gradually from the economic planning focus, bureaucracy should be subsidized to a market economy This transition and international integration makes Vietnam's economy has gradually developed Numerous state enterprises were stock stood firm and gradually asserted his role in the economy Viglacera Mineral Joint Stock Company is one of the enterprises converted from state-owned companies into joint stock companies, is one of the company's mining and mineral processing as raw materials for industrial production of construction materials (ceramic tiles, glass, porcelain )

A business required succeeding in the right direction, there are flexible and changing in accordance with its business environment A proper business strategy and a team fully capable of organizing the implementation of strategies to help companies capture, take advantage of opportunities and limit the risks, develop the strength and overcome the weaknesses in order to achieve above average returns

Viglacera Mineral Joint Stock Company is a small and medium companies have weak financial capability, just out of planning mechanism focused, narrow lines of business, the business environment is not stable, the construction business strategy for the Company is a very important job But for many different reasons that this problem is less interested A major reason the Company is a member of Viglacera Corporation The production plan previously established mainly based on the plan was delivered Corporation Business strategy of the Company to stop at the development and implementation of business plans every quarter and the year, according to the plan of the Corporation The long-term plan, providing strategic, often created sketchy, lacking scientific Another part is due to the lack of theoretical basis, lack of skills building strategies So the Company has no strategy

of its business in accordance with what it means Derived from the actual needs with the desire to apply knowledge learned in applications where members of the

working group Therefore, the group agreed selected topic "Building business-level

strategy Viglacera Mineral Joint Stock Company - Period 2015 - 2020" as the

subject of the research group

2 RESEARCH OBJECTIVES

- Based on the theory we have learned to manipulate reality to enhance business efficiency of production and business, reduce costs, deliver higher profits for businesses, improving enterprise's value and thereby increase effective social

- Apply the theoretical basis, the analysis tools to build a business strategy is suitable for business

- Draw out the action plan to implement the strategy

- Proposed solutions and recommendations for Company on the implementation of this strategy

3 SCOPE OF STUDY

Due to limited time and resources should we go further research and build business strategies for the business's current business, do not consider expanding lines of business into other areas

4 STUDY METHODOLOGY

- Study of the theory of building strategies - use of reference

- Collecting data at the enterprise and the information on the Internet

- Analysis assessment and quantitative strategies to choose

5 REPORT STRUCTURE

Title of the research: "Building business-level strategy Viglacera Mineral Joint Stock Company - Period 2015 - 2020"; except the introduction, conclusion

and references, is structured into sections as follows:

Chapter 1: THEORETICAL BASIS

Chapter 2: ANALYSING CURRENT STATUS OF VIGLACERA MINERAL JOINT STOCK COMPANY

Chapter 3: SELECTED BUSINESS STRATEGY AND PROGRAM

Chapter I THEORETICAL BASIS1.1 BUSINESS STRATEGIES FOR BUSINESS

1.1.1 The concept of business strategy

As usual means and strategies (derived from the original Greek word is strategos) is a military term used to refer to the battle plan layout and distribution of forces with the aim of votes wins enemies Carl von Clausewitz - the tactic of the

19th century - has described the strategy is “war planning and planning campaigns warfare The campaign he will determine the participation of individual” More recently, historian Edward Mead Earle described the strategy is “the art of controlling and using resources of a country or a coalition of countries aimed to ensure and increase the efficiency of their vital interests”.

Today, business organizations also apply the concept of strategy is similar to the military Strategy is planned and controlled use of organizational resources such

as people, property, financial aims to enhance and ensure the vital interests of there Kenneth Andrews was the first to offer ideas in the book highlights classic The Concept of Corporate Strategy According to him, strategy is what an organization must rely on their strengths and weaknesses in the context with the opportunities and threats

Bruce Henderson, strategist at the same time is the founder of Boston Consulting Group has connections with the concept of strategic competitive advantage Competitive advantage is setting a company in a better position to create

competition on the economic value for customers Henderson wrote that “Search strategy is a prudent action plan to develop and combine competitive advantage of organizations The difference between you and the competition is the basis for your advantage” Henderson believes the two cannot coexist if the competitor's business

they are identical Need to make a difference may exist Michael Porter also

received the approval of Henderson: “Competitive strategies related to the

difference That is the carefully selected a series of different activities to create a unique set of values”.

Can see that in all definitions of strategy have appeared phrases express the different aspects should be included in it Therefore, requires the definition of a multifaceted strategy, Mintzberg has launched with five P defined as follows:

Plan: a series of actions intended to consistently.

Pattern: is being consistent behavior over time, may be intended or not

intended.

Position: the match between the organization and its environment.

Perspective: is to realize how deeply about the world.

Ploy: is a specific way to trick opponents.

1.1.2 Nature of the business strategy

Is similar to military strategy, competitive strategy of an organization aims to achieve conformity between the capacity difference and the environment outside the organization involved competitive However, compared to military strategy, strategic business more complicated Unlike military conflict, competition in business is not always bringing local losers with winners The competitions in the industry sometimes have the opportunity to improve the strength and skills as egg competition The value of the capacity difference bring competitive advantage to organizations can be reduced over time by the changing environment Due to the possibility that this strategy not only competitive, but includes a few can be a different decision The important thing is to always discover new opportunities, prevent and repel potential threats, to overcome the current weaknesses and the power shifted to new areas (see Figure 1.1) Every business must cope with the strategic decisions continuously However, a number of strategic decisions can become urgent computer and bring in some louder than any period depends on the specific context

Figure 1.1: Business strategy

(Source: Pro /PhD Le The Gioi, Dr Nguyen Thanh Liem, MBA Nguyen Huu Hai

(2009), Strategic Management, Statistics Publisher)

1.1.3 Characteristics of business strategy

In business, to achieve long-term success, the enterprise should constantly upgrade their competitive advantage over time Fundamental problem that every business should be resolved when choosing business strategies, namely: choice of products and services will be provided to customers; how to create products and services; and how to make the products, services to customers Thus, business strategy has the following basic characteristics:

• Business strategy clearly defines the objectives and basic directions of business enterprises in each period

• Up-oriented strategy to ensure business continuity and development firm

in the business environment often fluctuates

• Business strategy ensures maximum mobilize and combine optimal exploitation and use of enterprise resources in the present and future, to promote the advantages and seize opportunities to gain advantage in competition

• Business strategies of the business are reflected throughout the process of continuous

• Business strategy always thought advancing, winning victory in the market business

Pass

Discover

Prevent

• Business strategy is usually built in a long period (3, 5, 10 years).

1.1.4 The overall competitive strategy

There are many different strategies to compete, but a general there are three basic approaches to creating competitive advantage, it is: Cost leading strategy,

Differentiation strategy, Focusing strategy Three ways are referred to as "generic strategies”, because they can be applied to any industry with large scale or small, all

products and services In 1985, three general strategies have been Michael Porter

first introduced in the classic book "Competitive Advantage: Creating and sustaining Superior Performance".

Each strategy as a result consistently selected the company's products, markets and the ability to make a difference, these options also affect each other

Table 1.1: Main features of overall business strategy

Cost leading strategy

Differentiation strategy Focusing strategy

Create differences

of the product

Low (mainly by price)

High (mainly in the unique)

Low to high (price

or unique)Market segment Low (big volume

market)

High (many market segments)

Low (one or several segments)Ability to create

differences

Manufacturing and materials management

Research and development, sales and marketing

Ability to create any difference

(Source: Pro /PhD Le The Gioi, Dr Nguyen Thanh Liem, MBA Nguyen Huu Hai

(2009), Strategic Management, Statistics Publisher)

1.1.4.1 Cost leading strategy

Strategy of cost leading is overall of actions in order to provide the product

or service which have features affected by customer with the lowest cost in relation

to all competitors In other words, strategies leading cost based on the ability of businesses to provide products or services with lower costs than competitors The purpose of person who being pursued the strategy of leading cost is better than

competitors, so that the cost of manufacturing and supply of any product or service

is lower than competitors

1.1.4.2 Differentiation strategy

The target of general strategy to make a differentiation is to achieve the competitive advantage of company by creating products (goods or services) which realize unique in some important characteristics by customers Company which makes a difference trying to satisfy customer’s demand by the way those competitors cannot do with intention of increasing price requirement (a significant price in industry average) The increased price of person who make the difference is often higher than the price which the person of leading cost require and customers willingly pay because they trust about the quality of different products, which has distinctive value

1.1.4.3 Focusing (concentration) strategy

Centralization strategy is a series of actions needed to produce goods and services to serve the demand of a specific segment of competitive market The main difference with two above strategies is that it directly serves demand of the group or limited segment of customers A centralization strategy will focus to the specific slot of market that can be determined the terms of geography, customer type, or segment of the product channel

1.2 SELECTING AND PLANNING BUSINESS STRATEGY

1.2.1 Strategic planning process

An effective business strategy together with the implementation of excellence is the best guarantee for the success of any organization A business survive in a changing environment, including changes in: technology, social values, consumer habits, economic conditions, policies and even the standards on pollution environment can see the risks, challenges and great opportunities

Leaders and senior researchers may give the reasons why enterprises should conduct strategic business planning One of the main reasons that make the Glueck:

• Condition of most business changes so fast that strategic planning is only one way to counter these problems and opportunities in the future.

• Strategic planning to provide all members of the business objectives and specific directions for future business

• Strategic planning as a basis for control and evaluation management

• Organizations and individuals planning strategy will succeed and achieve more effective planning is not

The process of planning business strategies, including the basic steps: setting goals, evaluating current location, building strategies, preparing and implementing strategic plans, evaluating and adjusting plans

* Setting business goals.

Building objectives or goals that enterprises want to achieve in the future Objectives must be realistic and to quantify exactly what businesses want to be In the process of strategic planning, targets special needs are: sales, profits, market share, reinvestment

* Evaluating current location.

There are two areas to assess: evaluate the business environment and evaluate the resources:

- Evaluate the business environment: Research on the business

environment to determine what factors in the current environment is a risk or opportunity for the goals and strategies of the business Assessing the business environment, including factors such as economic and political events, technology, market pressures, relationships and social

- Evaluate the resources: Full analysis of strengths and weaknesses of the company on the side: management, marketing, finance, production activities, research and development

* Building strategies.

After completing the evaluation, will move to phase selection To be

objectively The choice is usually clear from all the relevant information in the evaluation of the planning process However, to get the choice, a strategy must be reviewed by the parts: the cost, using scarce resources, time - the progress, and related to affordability.

* Preparing and implementing strategic plans.

Preparation and implementation of strategic plans of the two different processes, but related to each other:

- Phase organizations: the implementation process includes the organization of people and resources to strengthen the choice

- Phase policy: the development of a policy nature and function to consolidate, more detailed strategy chosen

* Evaluating and adjusting plans

At this stage of the process of planning business strategy, senior managers determine if their selection strategies in the model is consistent with the objectives

of the business This is the process control and management estimates the additional common scale

Figure 1.2: Strategic planning process

(Source: Associate Pro Dr Ngo Kim Thanh, (2009), Lecture presentation - Business Strategy, International Master of Business Administration Program -

Functional tasks and strategic goals

of the business

Functional tasks and strategic goals

of the business

Analysis of enterprise’s inside

Analysis of enterprise’s inside

Analyze the business environment

Analyze the business environment

organization and encourages all efforts to achieve organizational goals, career and ideas more.

By James Collins and Jerry Porras structure of the vision may include two basic components:

• Core ideology: Thought identify core features of a long held, that a

consistency determination has surpassed the life cycle of products or markets, breakthrough technologies, the management style of individuals and leaders In fact, the core ideology make important contributions and for sustainable success in business long-term vision

• Envisioned future: Envisioned future consists of two parts is a

challenging target of 10 to 30 years and vivid descriptions of what the objectives achieved On the one hand, as envisioned future convey specific - what a clear, lively and realistic On the other hand, it covers a period not realize the aspirations, hope, dream of it

1.2.2.2 Mission

Mission of the enterprise is a concept used to define the purpose of the business, the reasons that business is established and the basis exists, its development Mission of business is business manifesto for the society, it demonstrated the usefulness and significance of the existence of enterprises to social The mission statement is a critical order of how a business's perception of the demands of the parties concerned The mission statement focuses on the changes expected of the organization Focus and mission of the command to release the potential of the organization, but it is still capable of achieving what is in a period

Mission statement describes organizations in terms of business of it, the customers it serves, and the skills necessary to develop to meet the vision If vision

is the central achievement of the ideas and goals of the organization, the mission description vision way less abstract and more realistic Mission in more strategic vision, in which it set the direction on how large organizations will achieve or meet

the vision for a certain period Mission report describes an overview of the business customers, products and services primarily, the orientation of the enterprise in a period.

Mission statement creates the foundation for the entire work plan It is a reference point to evaluate the objectives and strategies of the organization

- Accurate and measurable

- Must be directed to other important issues

- Must be challenging but can be done (in fact)

- Should be identified with a period of time (sometimes correctly) can be achieved

- Provide tools to evaluate the performance of administrators

1.2.3 Business environment of enterprises

To business success, enterprises must have business strategies suitable environment for their own advantage by smoothly There are many factors that impact on business strategies, including external environmental factors, industry environment factors, and internal environmental factors

Figure 1.3: Macro Environment

(Source: Pro /PhD Le The Gioi, Dr Nguyen Thanh Liem, MBA Nguyen Huu Hai

(2009), Strategic Management, Statistics Publisher)

1.2.4 Analyzing external business environment

PEST model study of the impact of the factors in the external business environment based on factors:

Competition between rivals

Threat of New Entrants

Threat of Substitute Products

Threat of Substitute Products

Bargaining Power of Suppliers

Bargaining Power of Suppliers

Bargaining Power of Buyers

Bargaining Power of Buyers

Figure 1.4: PEST model

(Source: http://www.provenmodels.com/32)

Here are four factors that directly influence the economic sectors; these factors are external factors that businesses and industry suffered the effects of it as a factor brings objectivity Businesses based on impact to make policy, business suit

1.2.5 Analysis of the environmental business industry

A branch is a group of companies provide products or services can replace closely The competition, companies in sectors affect each other In general, each industry will include a diverse mix and competitive strategies that companies pursue to try to achieve higher income than average Replacement closely means products or services meet customer needs basically similar

Michael Porter - the strategic management famous of the Harvard University

- in his book "Competitive Strategy: Techniques Analyzing Industries and Competitors" has made the comment about the competitive pressure in all industry business By Michael Porter, the strength of competition in the market in an industry

affected any of the five competitive forces:

• Bargaining power of suppliers

• Threat of new entrants.

• Threat of substitute products or services

• Rivalry among existing competitors

Figure 1.5: Michael Porter's five forces of competitive position model

(Source:

http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/ar/1)

1.2.6 Analyze internal business environment

1.2.6.1 Resources, potential capabilities, core competence

Resources include a category of organizational factors, technical, material

and human resources, finance and business Resources can be divided into two categories: tangible resources and intangible resources Tangible resources can be seen and quantified, including financial resources, organizations, physical facilities and technology Intangible resources cannot see and cannot be quantified, including human resources, improved capacity and reputation

Potential capabilities of the enterprise are the ability to use resources that are

integrated with an aim to achieve a desired goal state The ability to produce over time through interaction between intangible resources and tangible, as an

organization closely linked together These skills focus on the daily work of the organization; the way decisions, management processes in order to reach the goals

of the organization More general, the potential ability of a business is the product

of organizational structure and control system

Core competence is the resources and capabilities of the enterprise are used

as a source of competitive advantage Core capabilities create competitive enterprises and quality of private Core capability arises from time to time through a learning process, has accumulated an organization about how to exploit the resources and capabilities of different As a possibility of action, the core capability

is “jewelry luxury of a business”; the business activities that perform well compared

to competitors and thereby increase its value to the goods and services in a long time

1.2.6.2 Competitive advantages of enterprises

A business is considered a competitive advantage when its profit rate higher than the average rate in the industry And businesses have a sustainable competitive advantage if it can maintain high profit rate in a long time Two basic factors to rate the profitability of a business is the amount of value that customers feel about the goods or services of the business and its production costs

By exploiting the core competence or competitive advantage to meet and satisfy both the standard requirements of competition, firms create value for customers

Essentially, creating superior value does not necessarily require a business to have the lowest cost structure in the industry or create products valued in the eyes

of customers, which is important deviation between value aware and production costs than most competitors Michael Porter has pointed out that low cost and the difference are the two basic strategies to create value and gain competitive advantage in an industry According to Porter, competitive advantage (as the higher profits) to businesses, this can create exceptional value And how to create value,

are not superior to lower business costs and/or create different products, so customers evaluate it higher and willing to pay a price increase.

1.2.6.3 Value chain analysis

Value chain, also known as value chain analysis, is a concept from business

management was first described and popularized by Michael Porter in 1985 in his

book entitled: Competitive Advantage: Creating and Sustaining Superior Performance.

Value chain is a chain of activities Products go through all the activities of the chain in order and at each operation, product obtained a value that Chain of activities gives the products more added value than the total value of all the activities combined It is important not to mix the concept of value chain with the cost occurred during the operation

Figure 1.6: Value chain

(Source: Pro /PhD Le The Gioi, Dr Nguyen Thanh Liem, MBA Nguyen Huu Hai

(2009), Strategic Management, Statistics Publisher)

Provided externalProductionProvide internal

MINUTES OF PROFITS

Because the value chain to reflect the activities related to the flow of goods within the enterprise (mainly activities), activities to support this line of goods (secondary activities) and activities associated with business as well as other foreign enterprises, so the Porter value chain analysis is useful in all sectors, although still the most obvious applications of it with the material flowing through the enterprise.

Biggest benefit of the value chain is that it allows decay to analyze how companies create products or services, and how to do well Use this tool to help identify a specific value is born from nature and where the competitive advantage of business Minimum each business unit must be reviewed by a value chain Sometimes generate more value chain for a business unit will be very useful if the products or services do differ

1.2.7 Model analysis to select strategies

1.2.7.1 SWOT analysis models and four types of strategies

A scan of the internal and external environment is an important part in the process of planning strategies of enterprises Environmental factors internal to the enterprise usually can be classified as strengths (S) or weaknesses (W), and those environmental factors external to the enterprise can be classified as opportunities (O) or threats (T) Such an analysis of environmental strategies is referred to as a SWOT analysis

The SWOT analysis provides information useful to combine the resources and capabilities of enterprises in the competitive environment that the business operates As such, it is instrumental in the development and selection business strategy The following diagram shows how a SWOT analysis in accordance with a business environment:

Figure 1.7: Map SWOT analysis

(Source: http://www.lucintel.com/SWOT_analysis.asp)

Strengths (S): One of the strengths of the business resources and its ability

can be used as a basis for developing a competitive advantage Strengths can be:

+ Patents

+ Strong brand names

+ Good reputation among customers

+ Cost advantages from proprietary know-how

+ Exclusive access to high grade natural resources

+ Favorable access to distribution networks

Weaknesses (W): The absence of certain strengths may be viewed as a

weakness Some of the following may be considered weakness:

+ Lack of patent protection

+ A weak brand name

+ Poor reputation among customers

Opportunities ThreatsWeaknesses

Strengths

ExternalAnalysis

InternalAnalysis

SituationAnalysis

SWOT Matrix

+ High cost structure.

+ Lack of access to the best natural resources

+ Lack of access to key distribution channels

In some cases, a weakness may be the flip side of strength Take the case in which a firm has a large amount of manufacturing capacity While this capacity may be considered a strength that competitors do not share, it also may be a considered a weakness if the large investment in manufacturing capacity prevents the firm from reacting quickly to changes in the strategic environment

Opportunities (O): The external environmental analysis may reveal certain

new opportunities for profit and growth Some may be considered as business opportunity:

+ An unfulfilled customer need

+ Arrival of new technologies

+ Loosening of regulations

+ Removal of international trade barriers

Threats (T): Changes in the external environmental also may present threats

to the business Some are considered threats may include:

+ Shifts in consumer tastes away from the business's products

+ Emergence of substitute products

To develop strategies that take into account the SWOT profile, a matrix of these factors can be constructed The SWOT matrix (also known as a TOWS Matrix) is shown below:

Figure 1.8: SWOT Matrix

(Source: http://www.greenfile.net/resources/Periscope/swot.htm)

- S-O: strategies pursue opportunities that are a good fit to the business's

strengths

- W-O: strategies overcome weaknesses to pursue opportunities.

- S-T: strategies identify ways that the business can use its strengths to

reduce its vulnerability to external threats

- W-T: strategies establish a defensive plan to prevent the business's

weaknesses from making it highly susceptible to external threats

1.2.7.2 Model analysis IE and three position strategy

* External Factor Evaluation Matrix - EFE

Matrix assessment of external factors is the model commonly used to evaluate the external factors affecting business EFE matrix models usually have four vertical columns and horizontal columns depending on demand First column divided into two groups is the problem:

List factors: The first step is to gather a list of external factors Divide

factors into two groups: Opportunities and Threats

Assign weights: Assign a weight to each factor The value of each weight

should be between 0 and 1 (or alternatively between 10 and 100 if use the 10 to 100 scale) Zero means the factor is not important 1 or 100 mean that the factor is the most influential and critical one The total value of all weights together should equal

1 or 100

Rate factors: Assign a rating to each factor Rating should be between 1 and

4 Rating indicates how effective the firm’s current strategies respond to the factor:

1 = the response is poor, 2 = the response is below average, 3 = above average, 4 = superior Weights are industry-specific Ratings are company-specific

Multiply weights by ratings: Multiply each factor weight with its rating This

will calculate the weighted score for each factor

Total all weighted scores: Add all weighted scores for each factor This will

calculate the total weighted score for the company.

* Internal Factor Evaluation Matrix - IFE

Internal Factor Evaluation (IFE) matrix is a strategic management tool

for auditing or evaluating major strengths and weaknesses in functional areas of a business IFE matrix also provides a basis for identifying and evaluating

relationships among those areas The Internal Factor Evaluation matrix or short

IFE matrix is used in strategy formulation

The IFE matrix can be created using the following five steps:

Key internal factors: Conduct internal audit and identify both strengths and

weaknesses in all business areas It is suggested identify 10 to 20 internal factors, but the more can provide for the IFE matrix, the better The number of factors has

no effect on the range of total weighted scores because the weights always sum to 1.0, but it helps to diminish estimate errors resulting from subjective ratings First, list of strengths and then weaknesses It is wise to be as specific and objective as

Weights: Having identified strengths and weaknesses, the core of the IFE

matrix, assigns a weight that ranges from 0.00 to 1.00 to each factor The weight assigned to a given factor indicates the relative importance of the factor Zero means not important One indicates very important If work with more than 10 factors in IFE matrix, it can be easier to assign weights using the 0 to 100 scale instead of 0.00 to 1.00 Regardless of whether a key factor is an internal strength or weakness, factors with the greatest importance in organizational performance should be assigned the highest weights After assign weight to individual factors, make sure the sum of all weights equals 1.00 (or 100 if using the 0 to 100 scale weights)

The weight assigned to a given factor indicates the relative importance of the factor to being successful in the firm's industry Weights are industry based

Rating: Assign a 1 to X rating to each factor Rating scale can be per

preference Practitioners usually use rating on the scale from 1 to 4 Rating captures whether the factor represents a major weakness (rating = 1), a minor weakness (rating = 2), a minor strength (rating = 3), or a major strength (rating = 4) If use the rating scale 1 to 4, then strengths must receive a 4 or 3 rating and weaknesses must receive a 1 or 2 rating

Note: The weights determined in the previous step are industry based Ratings are company based

Multiply: Now can get to the IFE matrix math Multiply each factor's weight

by its rating This will give a weighted score for each factor

Sum: The last step in constructing the IFE matrix is to sum the weighted

scores for each factor This provides the total weighted score for business

* Internal - External Matrix - IE

The IE matrix belongs to the group of strategic portfolio management tools The IE matrix positions an organization into a nine cell matrix

The IE matrix is based on the following two criteria:

• Score from the EFE matrix - this score is plotted on the y-axis

• Score from the IFE matrix - plotted on the x-axis

The IE matrix works in a way that plot the total weighted score from the

EFE matrix on the y axis and draws a horizontal line across the plane Then take the score calculated in the IFE matrix, plot it on the x axis, and draw a vertical line across the plane The point where horizontal line meets vertical line is the determinant of strategy This point shows the strategy that company should follow

On the x axis of the IE Matrix, an IFE total weighted score of 1.0 to 1.99 represents a weak internal position A score of 2.0 to 2.99 is considered average A score of 3.0 to 4.0 is strong

On the y axis, an EFE total weighted score of 1.0 to 1.99 is considered low

A score of 2.0 to 2.99 is medium A score of 3.0 to 4.0 is high

Figure 1.9: IE Matrix

(Source: Associate Pro Dr Ngo Kim Thanh, (2009), Lecture presentation - Business Strategy, International Master of Business Administration Program -

Griggs University)Horizontal and vertical lines meet in one of the nine cells in the IE matrix Company should follow a strategy depending on in which cell those lines intersect

II I

The IE matrix can be divided into three major regions that have different strategy

implications

• Cells I, II, and IV suggest the grow ing and build strategy This means intensive and aggressive tactical strategies Strategies should focus on market penetration, market development, and product development From the operational perspective, a backward integration, forward integration, and horizontal integration should also be considered

• Cells III, V, and VII suggest the hold and maintain strategy In this case,

tactical strategies should focus on market penetration and product development

• Cells VI, VIII, and IX are characterized with the harvest or exit strategy

If costs for rejuvenating the business are low, then it should be attempted

to revitalize the business In other cases, aggressive cost management is a way to play the end

1.2.7.3 Quantitative Strategic Planning Matrix - QSPM

Quantitative Strategic Planning Matrix (QSPM) is a high-level strategic

management approach for evaluating possible strategies Quantitative Strategic

Planning Matrix or a QSPM provides an analytical method for comparing feasible

alternative actions The QSPM method falls within so-called stage three of the strategy formulation analytical framework

When company executives think about what to do, and which way to go,

they usually have a prioritized list of strategies If they like one strategy over

another one, they move it up on the list This process is very much intuitive and

subjective The QSPM method introduces some numbers into this approach

making it a little more "expert" technique.

Development of QSPM Matrix can follow the steps:

• Provide a list of internal factors - strengths and weaknesses Then generate

a list of the firm's key external factors - opportunities and threats These

will be included in the left column of the QSPM Can take these factors from the EFE matrix and the IFE matrix.

• Having the factors ready, identify strategy alternatives that will be

further evaluated These strategies are displayed at the top of the table Strategies evaluated in the QSPM should be mutually exclusive if possible

• Each key external and internal factor should have some weight in the

overall scheme Can take these weights from the IFE and EFE matrices again

• Attractiveness Scores (AS) in the QSPM indicate how each factor is

important or attractive to each alternative strategy Attractiveness Scores are determined by examining each key external and internal factor

separately, one at a time, and asking the following question “Does this factor make a difference in our decision about which strategy to pursue?”

If the answer to this question is yes, then the strategies should be compared relative to that key factor The range for Attractiveness Scores

is 1 = not attractive, 2 = somewhat attractive, 3 = reasonably attractive, and 4 = highly attractive If the answer to the above question is no, then

the respective key factor has no effect on decision If the key factor does not affect the choice being made at all, then the Attractiveness Score would be 0

• Calculate the Total Attractiveness Scores (TAS) in the QSPM Total

Attractiveness Scores are defined as the product of multiplying the weights by the Attractiveness Scores in each row The Total Attractiveness Scores indicate the relative attractiveness of each key factor and related individual strategy The higher the Total Attractiveness Score

is the more attractive the strategic alternative or critical factor

• Calculate the Sum Total Attractiveness Score by adding all Total

Sum Total Attractiveness Scores reveal which strategy is most attractive Higher scores point at a more attractive strategy, considering all the relevant external and internal critical factors that could affect the strategic decision.

QSPM Matrix expressed relative attractiveness of these strategies can be selected and more importantly, it provides objective basis to consider and decide on options trading business strategies most appropriate

1.2.7.2 Evaluation and selection strategies

Strategies must be based on competitive resources a competitive advantage to succeed The enterprise can automatically create a competitive advantage for themselves, if it does take reasonable steps to win the top position in attracting customers than competitors Steps or pathways of each enterprise implementation can vary, but even companies that have chosen the path to competitive advantage, is crucial for customers to feel superior value compared with what the competitors offer

Businesses will be a steadfast effort to create competitive advantage through

an infinite series of strategies Competitive strategy designed to exploit the value chain and the other the strength to create competitive advantage Thus, each enterprise will try to make up for their specific strategies in accordance with the analysis of strengths and weaknesses in the value it can provide, external environment and customer needs

Enterprises in the industry can pursue a variety of different business strategies that distinctions between them relating to factors such as the choice of market segments to service, product quality, leading technology, serving customers, pricing policies and advertising policies So, in most industries will generate the group strategy, in which the business will pursue joint strategies similar

The direct competitors of the business as competitors pursue the same strategy in the group’s strategy are Consumers may notice the products of the enterprises in the group are substitutes for each other Thus, the main threat to the

ability of a business interest may arise primarily in his team's strategy, not necessarily from other businesses in the industry are pursuing different strategies.Groups of different strategies may have a different positions corresponding to each of the five forces competitive forces of Porter, because of forces affecting businesses in different ways In other words, risk in the new competition by the potential and extent of competition between firms in a group, ability to negotiate the buyer, negotiating capacity of suppliers and competitive forces from products or services can be replaced completely changes the intensity of strategic groups in the same industry.

Summary Chapter 1

Analysis systems theoretical base will be used as scientific basis for analyzing the business environment and assess the status of the Company in the economic environment and social relationships, context effects to Company strategy and policies of the Company in future.

Contents Chapter 1 presents some methods of construction, selection strategy for a company, the measures implemented strategic management company This covers the theory, can be deeply analyzed some aspects specific to the Company in the next section from which there is a scientific strategy, the most proper.

Chapter II ANALYSING CURRENT STATUS OF VIGLACERA MINERAL JOINT STOCK COMPANY

2.1 ABOUT COMPANY

2.1.1 General Introduction

Company name: VIGLACERA MINERAL JOINT STOCK COMPANY

Address: Village Van Tien - Yen Bai City - Yen Bai Province

Phone: 84293854673/ Fax: 84293854674

Capital: 12,500,000,000 VND

The Company was founded in 2001 on the basis of business cooperation between Yen Bai Mineral Company and Viglacera Corporation, took the name Yen

Ha Joint Venture After six years of operation, the company continued losses June

2006 collaboration agreement was deleted; the Company was restructuring the organization and become a member of Viglacera Corporation, renamed Viglacera Yen Ha Company March 2007 the Company was equitization, which Viglacera Corporation holds 51% charter capital The company was renamed Viglacera Mineral Joint Stock Company

* Scopes of business of the Company:

- Exploring, exploiting manufacture minerals and raw materials for industries producing ceramic and glass

- Trading; import and export of raw materials, materials for production; goods; equipments for manufacture and business

- Transportation of goods by road, waterway, railway

* Organizational structure of the Company:

Figure 2.1: Organizational models of the Company

(Source: Organizational structure Report in 2007 of the Company)

* Products and markets of the Company:

The Company's products are all kinds’ feldspar with many types and different quality level Currently, the Company has three product lines:

- Feldspar bone: four types of the FX1, FX2, FX3, FX4 used as a bone of ceramic products

- Feldspar enamel: four types of the FM1, FM2, FM3, FM4 used as a glaze

Control Board Management

Board

Management Board

Board of Directors

Board of Directors

Planning - Development Department

Planning - Development Department

Processing Factory

Processing Factory

Enterprise exploitation

Enterprise exploitation

Economy Department

Business Division

Business Division

Research and Development Division

Planning and production management Division

Planning and production management Division

+ FM products constitute 2% yield; 4% of sales.

+ FK products constitute 23% yield; 36% of sales

Company’s market is a market for market feldspar powder; provide manufacturers to produce ceramics, glass panels and glass in Vietnam

Total demand consumption of raw materials feldspar in Vietnam about 1.2 million tons per year Currently, production capacity of the Company is 100 tons per year, accounting for 8% market share

Company is in the process of building the quality management system ISO

* Mission:

Promoting available resources, strengthening of new resources, enhancing staff capacity of employees, innovation and development, to the Company will grow strong; in the spirit of striving for a career in the direction of the Company's general capacity building activities of production and business, to maintain and enhance the prestige and competitiveness of enterprises Work producing more and achieve business efficiency and improving life staff employees, improve corporate value for shareholders, successful implementation of the provisions of law, improving social benefits, environmental protection and sustainable development

* Strategic objectives to 2015:

- Period 2010 - 2012: steady production, intensive investment, innovation industrial capacity of the plant is up 150,000 tons/year Concentrate production of products with high quality requirements for 2012 sales to reach over 70 billion VND per year Preparation of legal procedures for investing new factory in the town

of Thac Ba - Yen Binh - Yen Bai with a capacity of 100,000 tons/year

- Period 2013 - 2015: implementation of new plant investment, raise production capacity to 250,000 tons of the Company in the year 2015, sales reached

100 billion VND per year

- Ensuring profitable Company annual growth 30%

We can see the vision, mission and objectives that the Company offers is relatively consistent However, the Company should add the following additional:

- About vision: Gradually penetrate regional markets and world markets.

- On strategic objectives:

+ Since 2015, striving to export more than 20% of production output

+ Income officials and employees average increase of 20% per year

+ Construction Company to become the company has modern management style, friendly environment, with cultural identity

2.1.3 Results of operation and financial situation of the Company from

I Cash and cash equivalents 2,786,083,167 4,662,247,135 6,642,722,422

II Investments short-term

7 Reserve to pay short-term

II Long-term debt 26,936,545,583 19,512,210,864 15,881,851,980

1 Loans and long-term debt 26,517,046,444 19,496,000,000 15,872,600,000

2 Other pay long-term 296,442,789

3 Backup job loss benefits 123,056,350 16,210,864 9,251,980