GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM C3RIGGS UNIVERSITY CAPSTONE PROJECT DEVELOPINGFORMULATION SONG DA REPORT OF BUSINESS STRATEGIES JOINT STOCK COMPANY IN THE PERIOD OF 2012 - 2017 Group - GaMBA01.X0710 Do Manh Tuan Nguyen Truong Bac Tran Viet Phong Le Thi Thu Trang Ha Noi, November 2011 -T- FOR SONG DA HOLDINGS SONG DA JOINT STOCK COMPANY Dated December 8" ,2011 To whom it may concern Subject: Comments of SONG DA Joint Stock Company on the project of Group 4— GaMBA01.X0710 — Griggs University The students have closely followed up the current situation of the organization structure and the business activities of SONG DA Joint Stock Company to implement the project In addition, they have also discuss, research about strategy tO planning followed up leaders’ idea The content of the “Capstone project report Developing business strategies for DA joint stock company in the period of 2012-2017” project mentions the goals and strategy that SONG DA JSC is trying to reach and has high SONG feasibility The content of the project is excellent Nguyen Thong Hoa Chairman SONG DA JOINT STOCK COMPANY Add: Village It Ong - District Muong La — Province Son La Tel: 84(22).830.786 - Fax: 84(22).830.921 Email: info@songda7.com.vn www.songda7.com.vn LIST OF ABBREVIATION HUD | ~~ SUDICO Housing and Urban Development Holdings Song Da urban & industrial zone investment and development Joint Stock Corporation VINACONEX | Vietnam construction and Import — Export Joint Stock Corporation | EFE External Factor Evaluation «FE Internal Factor Evaluation IE Internal & External | PEST Policy - Economic - Social - Technological | §D7 Song Da JSC SWOT strengths - weaknesses - opportunities - threats WTO World Trade Organization LIST OF TABLES Table 2.1: Workforce situation in the Company by the end of June 30,2011 Table 2.2: Impact evaluation of opportunities for Song Da Table 2.3: Impact evaluation of Threats for SD Table 2.4: Summary of opportunities and threats for SD Table 2.5: External Factor Evaluation Matrix (EFE) Table 2.6: Production and business results of SD7 from 2008 —the 2nd quarter, 2011 Table 2.7: List of new machines Table 2.8: Cost Structure of the Company in comparison with other enterprises in the same industry in 2010 Table 2.9: Company’s internal factor evaluation matrix Table 2.10 : IE matrix Table 2.11 SWOT analysis of competitors Ö_3„~ Table 3.1 SWOT analysis of Song Da Joint Stock Company Table 3.2: GREAT model to choose the optimal strategy for SD7 Table 3.3: Table 3.3: Implementation plan for cost leadership strategy Table 3.4: Statistics of expenses for all the project LIST OF FIGURES AND CHART Figure 1.1: The process of strategic management Figure 1.2 : Michael Porter’s Five Force Model Figure 1.3: Diagram of main business activities and supporting activities Figure 2.1: PEST model Figure 2.2: Michael Porter’s Five Force Model Chart 2.1: Economic growth in the world, U.S, Europe, Japan, some developing countries in Asia and Vietnam Chart 2.2: GDP growth rate and economic sectors during 2000- 2010 ACKNOWLEDGEMENT First of all, the Group No - GaMBA0I1.X0710 would like to express our sincere thanks for the Master of Business Administration Program, the Affiliate Programs between Griggs University, USA and Center for Education Technology and Career Development, Vietnam University Hanoi for organize MBA course in Vietnam and facilitating our Capstone Project Report Secondly, we would like to express our sincere thanks to the Leaders and staffs of Song Da Joint Stock Company, who have fully supported our team in providing valuable input information for this Capstone Project Report Last but not least, let our thanks go to our families whose encouragement has helped us complete the course without having any difficulties We have tried to complete the assignment in the best way using our best knowledge and ability However, the shortcomings are inevitable We receive valuable comments from teachers and colleagues wish to INTRODUCTION Research topic: DEVELOPING BUSINESS STRATEGIES FOR SONG DA JOINT STOCK COMPANY IN THE PERIOD OF 2012 - 2017 Reason for selecting the topic: To developing countries, construction industry is always considered as one of the major industries, development, playing especially an important during the role period in the economic of national and _ social industrialization and modernization In the market economy, the competition rules exist in every industry and field of business The construction industry is not an exception, therefore each company has to find its own path way and develop specific business strategies in order to survive and grow sustainably Song Da Joint Stock Company was formerly Song Da company, belonging to Song Da Corporation which was established in August 1976 The traditional production expands field of operation at Song Da In the era of industrialization to and develops new fields is construction and modernization, such as material the company construction investment, management, operating small and medium hydro-electric power plants, financial investment in other companies, investment in city infrastructure projects and natural mineral exploitation projects Song Da Joint Stock Company was established according to the Decision No 2335/QD-BXD of December Construction, transforming Company number The company 24.03.000081 19th 2005, by the Song Da Company Minister of Ministry of into Song Da Joint Stock was issued the first business registration certificate by Son La Department of Planning and Investment, on December 29 2005; the Company officially commenced on January | 2006; the second business registration certificate number 24.03.000081 was issued by Son La Department of Planning and Investment on October 2006 -5- On January 27 2006, the Company started listing and trading its stocks on Hanoi stock exchange with the charter capital of 90 billion VND Facing the changes in the world and national economy, as a company operating in the fields of investment, real estate service, civilian construction, industry construction, Song Da Joint Stock Company realizes it is necessary to build up its business compete strategy to develop the whole operation and gain market share over other domestic reaching the growth objective of 2012 — 2017 period, activities, in order to and foreign companies, and creating the basis for the sustainable growth in the years to come This is the reason why the group chooses the topic of “Developing business strategies for Song Da Joint Stock Company in the period of 2012 -2017” Purposes of the research - Review fundamental theories of strategy and strategic management - Apply some useful models to analyze the process of formulating and selecting strategies - Analyze the real situation in which Song Da Joint Stock Company has been implementing its strategies - Analyze factors of the external and internal environment which impact on the company’s strategies - Present proposals and solutions aiming at improving process of developing production and business strategies for Song Da Joint Stock Company in the current conditions together with planning implementation schedule for the selected strategies from 2012 to 2017 Objective, scale and methodology - Objective and scale: The research focuses on current strategic management activities of Song Da Joint Stock Company and provides some solutions for the period of 2012 - 2017 - Methodology: The research uses two kinds of information sources: primary and secondary information The secondary information comes from various sources However, a major percentage of the information is from -6- reports on current business situation provided by Song Da Joint Stock Company Besides, we have also gathered from many opened sources such as internet and books Structure of the research Introduction Chapter I: Literature review of strategy and strategic management Chapter II: Analyzing current situation and formulating development strategies for Song Da Joint Stock Company during the period of 2012 — 2017 Chapter III: Solutions for strategy development and implementation of Song Da Joint Stock Company Conclusions CHAPTER LITERATURE REVIEW OF STRATEGY AND STRATEGIC MANAGEMENT 1.1 Overview of strategy and strategic management 1.1.1 Definitions of strategy and strategic management: Definitions of strategy: Strategy company, is the process of defining basic long term objectives of a selecting method or action plan and allocating the necessary resources to achieve those objectives (Alfred Chander) Strategy is a consistent, ensure that all the main comprehensive, cooperative plan objectives of the company designed to will be achieved (William J Glueck) Michael L Porter, the founder of competitive theory states that: e Strategy is the creation of a valuable and unique position including differentiated activities e Strategy is about selecting and trading off in business e Strategy is creating the appropriateness among all the company’s activities Therefore, firstly strategy relates to the business objectives Secondly, strategy is the way to execute the actions and decisions which are closely related and to select the method to cooperate those actions and decisions A company’s strategy has to utilize the main strengths (resources and capability) and anticipate cpportunities and threats from the external environment The concept of strategic management: Strategic management is the process of researching, analyzing the external and internal environment of a company in the current and future period; defining the company’s objectives; planning, implementing and evaluating the strategy to effectively utilize the resources and reach the desired goals The process of strategic management: -8- Strategy Control Evaluation and Adiustment Figures 1.1: The process of strategic management 1.1.2 The role and importance of strategy and strategic management: Strategy helps the organization have a flair for and be more dynamic to the forecasts and changes of the market, therefore making right decisions and control its operation, improve the competitive capability of the business and gradually ensure the position of the company in the market economy Michael Porter states in his book “Competitive Strategy” that “Competitive strategy is within the relationship between the Company and its market” Because of its importance, the company has to create its own long term strategy, this is the requirement to help the company sustain and develop in the future However, the market environment always change, the business resource also changes after periods Therefore, a company’s strategy has to be flexible, suitably changing to the reality to ensure the existence and development Companies may choose its strategy basing method, using factors in the following order: 1/ Company’s resource on the information analysis ... creating the basis for the sustainable growth in the years to come This is the reason why the group chooses the topic of ? ?Developing business strategies for Song Da Joint Stock Company in the period. .. 2335/QD-BXD of December Construction, transforming Company number The company 24.03.000081 19th 2005, by the Song Da Company Minister of Ministry of into Song Da Joint Stock was issued the first business. .. colleagues wish to INTRODUCTION Research topic: DEVELOPING BUSINESS STRATEGIES FOR SONG DA JOINT STOCK COMPANY IN THE PERIOD OF 2012 - 20 17 Reason for selecting the topic: To developing countries,